Autolus Therapeutics (NASDAQ:AUTL) Q1 2020 Earnings Call

0:00 Ladies and gentlemen, thank you for standing by and welcome to the Autolus Therapeutics first quarter 2020 financial results and operation highlights conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one on your telephone. Please be advised that today's conference has been recorded. If you require any further assistance, please press star zero. I will now like to hand your conference over to your speaker today, Dr. Lucinda Crabtree, Vice President of Investor Relations. Thank you. Please go ahead, ma'am. Thank you, Cara. Good morning or good afternoon, everyone, and thank you for taking part in today's call on the financial results and operational highlights for the first quarter of 2020. I am Lucinda Crabtree, Vice President of Investor Relations.

0:55 With me today are Dr. Christian Itin, our Chairman and Chief Executive Officer, and Andrew Oakley, our Chief Financial Officer. Before we begin, I would like to remind you that during this call we will be making forward-looking statements. All statements other than statements of historical facts contained in this presentation are forward-looking statements. Our actual results, performance or achievements may be materially different from those expressed or implied by the forward-looking statements. For a discussion of the risks and uncertainties relating to our business and other important factors, any of which could cause our actual results to differ from those contained in the forward-looking statements, please see the section titled Risk Factors in our annual report on Form 20F filed on March 3, 2020, as well as discussions of potential risks, uncertainties and other important factors in our other periodic filings with the SEC. The forward-looking statements contained in this presentation reflect the company's views as of the date of this presentation regarding future events.

1:50 and the company does not assume any obligation to update any forward-looking statements. You should therefore not rely on these forward-looking statements as representing the company's views as of any date subsequent to the date of this presentation. So with that on slide three you will see the agenda for today and it is as follows. Christian will provide a brief introduction and that will be followed by our operational highlights for the first quarter of 2020. Andrew will next discuss the company's financial results and then Christian will conclude with upcoming milestones and other concluding comments. And of course, we welcome your questions following our remarks. So with that, I'd like to now turn the call over to Christian. Thank you. Thank you, Lucinda, and welcome to all of you and thank you for joining us. I'm pleased to review our progress for the first quarter in 2020.

2:38 We are pleased to report in a very productive first quarter. We remain on track with our clinical programs despite the challenges of COVID-19. As an organization, we have quickly adapted to this challenging environment, ensuring business continuity. Our focus has been on ensuring our clinical B-cell programs, Auto 1 and Auto 3, continue to progress, and we remain on track with recruitment ongoing and manufacturing operations uninterrupted. As such, we expect to deliver data in the timelines that we have previously guided. While some of our participating clinical centers have been infection hotspots and had to pause enrollment for a few weeks, others could continue to work unimpacted. We expect infections will continue throughout the year with flare-ups in places that were hit by the first wave of infections, while areas spared for now may see a rise in infections at some point in the upcoming months.

3:32 What is important to remember is that the patients we enroll in our trials have a very high medical need, no different from a severe COVID-19 patient, and the drive for centers to continue to treat these cancer patients is very high. Typically, if a center gets under heavy pressure from COVID-19 infections, stem cell transplants and CAR T therapy are among the last procedures to be stopped and are among the first to resume post-peak infection. As many of you have analyzed, the time from establishing social distancing and stronger measures to reaching the other side of the first infection peak has in all impacted areas taken approximately eight weeks, irrespective of whether the measures were taken early or late relative to the rise of infections.

4:20 The consistency of this infection pattern is helpful to anticipate the time of impact on a given center and catchment area. We expect the increasing levels of preparedness and adjustments underway in the various healthcare systems and the continued implementation of social distancing measures will allow for continued treatment of these severely ill patients throughout the year. We expect that the adjustments we made for clinical trial operations and in our supply chain will remain relevant and in place for the duration of this infection cycle plus the vital operational adjustments we made to minimize risk of infection and exposure as well as increase resilience towards the risk of business interruptions will also remain in place and if necessary will be adjusted.

5:08 With regards to our earlier stage programs we are monitoring potential impact. At this point we may see up to a quarter of delay depending on the program and the impact COVID-19 had on our respective academic or business partners. With that, and remaining on slides live, let me give you an overview of our corporate highlights. We announced in April that the FDA accepted the IND application for Auto-1, our lead CAR-T product candidate, for the treatment of adult patients with acute lymphoblastic leukemia, which allows us to initiate clinical sites in the company's first pivotal study, Auto-1, AL-1, in the US. This followed the opening of the first site in the UK in March of this year, having received approval of the clinical trial applications by the MHRA earlier in the quarter.

5:55 We expect to initiate dosing of our first patient in this study this quarter and remain on track to provide full data by the end of 2021. With regards to our lead product candidate for the treatment of DLBCL auto three, the phase one two Alexander study is ongoing. The timing of the program remains on track and we will update on decision for phase two in mid 2020 as previously guided. We're excited about our DLDCL program and its broader market potential following the positive data update we provided at the EHA-EBMT CAR T-cell meeting in February 2020. Our Chief Scientific Officer, Dr. Martin Pule, presented early encouraging signs of sustained complete responses achieved with low toxicity and minimal patient management required.

6:41 We're now planning to add a 20-patient cohort to the ongoing Alexander study in second half of this year with patients treated in an outpatient setting which I will explain and expand on a little later in this call. The last item I wish to touch on in this slide is our forthcoming clinical data updates expected through May and June. For order one in adult ALL, we plan to present updated data at the virtual EHA meeting in June with approximately six months of additional follow-up post our ASH 2019 data cut. For order three, we're planning to present updated data at ASCO in an oral session. We will also follow up with a similar presentation at the EHA meeting two weeks later. We plan to present both sets of data to investors in calls shortly following these virtual conferences.

7:29 Moving to slide six. In addition to our two lead clinical candidates, we're planning a series of preclinical data updates on some of our pipeline programs at AACR2 in late June. We have been invited to make an oral presentation on our prostate cancer program auto seven and also have poster presentations planned for both Auto 6 and G in small cell lung cancer as well as Auto 5, the sister program to Auto 4 in T cell lymphoma. Much like ASCO and DHA, we're planning an investor call that will shortly follow these presentations at AACR2. Finally, I would like to thank our partners at the Cell Therapy Catapult and the GSK site organization in Stevenage for their continued support that enabled us to maintain operations throughout the peak infection and support the critically ill patients in our trials.

8:20 Moving to slide seven, I wanted to spend a brief moment recapping on our lead program model one in adult ALL. Relapsed refractory adult ALL is a challenging disease and often impacted in elderly patients. A lot of these patients have significant comorbidities making them a fragile patient group to treat. The indication is approximately three times the size of relapsed refractory pediatric ALL and represents an attractive market opportunity. Within the US and the top five European countries, approximately 3,000 patients every year are at an end stage of treatment having failed chemo and transplant and therefore requiring other options. At this point, there's no CAR T therapy approved for adult ALL. Obviously, there are a number of programs that are being tested However, all of them have experienced significant challenges with the management of the toxicities.

9:15 What we created with Auto1 is a product that is designed to behave physiologically and engages target cells like a normal T cell would. First generation CAR-T products share the identical binder to CD19. This is true for Chimriah, Triscarta, and Lysa cell. This binder has a slow off rate from the CD19 target. and as a consequence, once the CAR-T cell binds to the leukemia cell and has delivered the toxic payload, it has difficulty letting go from the target cell and gets stuck. When you have CAR-T cells getting stuck to target cells, they continue to be activated, which drives cytokine release and thus adverse events. In addition to leading to cytokine release syndrome, this continued activation of the CAR-T cells can drive exhaustion, which negatively impacts persistence. So there's a fundamental challenge with that type of engagement.

10:09 In contrast, what we created with Auto1 is a CAR-T product that mimics the behavior and the binding kinetics of a physiological T cell with a very fast off rate and an ability to disengage relatively rapidly after delivering the kill. The result is reduced cytokine release and also an increase in target cell killing as the CAR-T cells are freed up more quickly and can re-engage new leukemia cells. In addition, CAR-T cells can expand more readily leading to more active CAR-T cells in the patient's body capable of fighting the leukemia. Now turning to slide eight, what we show on the left hand side is the data for Blina-2 imabrable in cyto which is the current standard of care in this disease setting.

10:54 What is important to understand is that the patients that we have treated on our trial and what we highlighted at ASH is that the patients have mostly undergone and failed stem cell transplants. In addition, approximately 60% of patients have been on inotuzumab or blenatumumab and failed. So our data is based on a patient population with more advanced disease compared to the data shown for blenatumumab. However, what you see in the blenatumumab results is that the CR rate in that population is about 40% with an event-free survival of about 30% at six months, and in fact, most patients relapse within less than a year. When we look at the safety profile, Blincyto shows a good safety profile overall, and in fact, the product is typically delivered in an outpatient setting.

11:44 Now, when we look at our own data for order one, if you look at the total data set of 16 patients, you have an overall CR rate of 87%, and then have an event-free survival of 68% at six months. So in a simple way, We have around twice the activity that was reported with Blenatumumab with a comparable safety profile. We have had no patients with high-grade cytokine release syndrome. We had 19% of the patients with high-grade neurotoxicity. All patients with high-grade neurotoxicity had a very high tumor burden in the marrow of more than 50%. Going forward, we will manage these patients when the neurotoxicity starts to build to minimize high-grade adverse events. Finally, I just wanted to touch on the subset of patients that were treated with the closed commercial manufacturing process.

12:34 You can see that the data, if anything, looks somewhat better than the total overall, which includes patients that were treated with product that was manufactured by hand with a conventional manufacturing process. So based on this data, on turning to slide nine, we decided to move the program forward into a pivotal study. The CTA was filed in the UK and cleared in Q1 and we're rolling currently in the UK. The USID also is now open and we're opening up centers in the US with the aim of enrolling patients in the second quarter. As a reminder, this is a single arm 100 patient study with relapsed refractory patients. The primary endpoint is CR rate and secondary endpoints include molecular CRs, rent-free survival, and duration of response. We remain on track to complete enrollment in the first half of next year.

13:25 To what extent we may be impacted by the COVID-19 situation going forwards, we'll have to see, but we currently expect the impact to be limited. Our plans to deliver data by the end of 2021 remain on track. Let's now turn to slide 10, where I would like to switch gears and talk about Auto3, a program that is designed for the treatment of patients with diffuse large B-cell lymphoma. Thirdline DLBCL is about four times bigger an indication than relapsed refractory adult ALL and a setting with already two approved CAR-T therapy products with Giscard and Kimraya plus Lysazel or JCAR17 expected to be approved later this year or beginning of next year. We know this is a large opportunity with approximately 10,000 patients on the back end of the disease, which is a sizable population with a very significant medical need. In terms of the outlook for those patients, they have typically run through a series of chemotherapy combinations often with a monoclonal antibody and may also have received a transplant if they were eligible for it.

14:29 If not, they go directly to salvage therapy. CAR-T therapies are approved in the third-liner salvage therapy setting with trials ongoing in patients in second-line setting. There are two things that we see as being really important for successful treatment and commercial uptake in DLD-CL. First, you have to induce complete remissions that are lasting. This is a disease setting where you aim for cure. Second is that you actually have to have a therapy that can be administered where the patients are situated. Today, in the US, approximately 80% of the patients are treated outside of university hospitals, and only about 10% of the patients are treated as university hospital inpatients. It is this population that is primarily treated with CAR T therapies.

15:16 The key challenge for treatment centers is the need for intense patient management, which has limited the use of CAR T outside of the university hospital inpatient setting. What we're looking for in auto three is a high level of sustained complete remissions. In addition, we're looking for a safety profile that can be managed in non-academic outpatient settings to reach the majority of patients. Moving to slide 11, across the CAR T programs in DLBCL, We observe a fairly high overall response rate, yet the sustained complete response rate is limited. It is somewhere between 30% and 40%, depending on the program and the subset of indications that were treated or included in the respective trials.

16:01 Roughly a third of the complete responses are lost early on, typically within the first three to six months. There are two key mechanisms reported that are likely driving relapse. Loss of CD19 antigen in about 30 to 50 percent of the patients at time of relapse and PD-L1 checkpoint upregulation in about two-thirds of the patients at time of relapse. Looking at safety, with the commercial CD19 cars there is a significant amount of management of those patients required to address severe cytokine release syndrome and in particular as well as the severe neurotoxicity. Typically, these toxicities have an early onset and require intense patient management and monitoring, meaning patients are largely confined to a classical hospital inpatient setting. We designed a program with a dual targeting approach, having two independent receptors in each CAR-T cells, individually designed and optimized for the respective target antigen to minimize the impact of CD19 antigen loss.

17:04 We also countered the PD-L1 upregulation and checkpoint-based escape of lymphoma cells with a single dose of pembrolizumab on the day before infusion of order 3, providing the cover to achieve a CR and sustain it. Order 3 has shown a high level of CRs in the dose escalation phase of the current study and we will present a further update at ASCO. It is worthwhile noting that the high level of complete remissions were obtained without inducing high-grade CRS, or cytokine release syndrome, and no neurotoxicity of any grade in the patient's dose at 150 to 450 million cell doses. This is a very unusual finding. When you compare this profile to the Chescarita, Chimraya and JCR17 data, the contrast is remarkable. What is also important to note is that with Auto3, we have not managed the patients actively for adverse events.

17:59 Now to talk about the extent of the total addressable market this profile enables us to potentially reach, let's continue to slide 12. Currently, approved products are only tapping into a proportion of substantially less than 20% of the market opportunity, which is managed by the academic centers. There's very little to no penetration to the remaining 80% of the market, which comprises settings that cannot deal with the intensity of patient management required for the current CAR T products. We believe this creates an enormous opportunity for the profile of a product that we're seeing with Auto3 and as such we believe that the program has a unique potential going forward. We expect to provide an updated ask on the clinical profile of the program.

18:44 So let us turn to slide 13 where I would like to outline how we continue to build on this potential patient profile. Given the highly differentiated clinical and safety profile we have reported so far, we see an attractive opportunity for Auto3 as an in and outpatient solution for patients with DL-BCL, therefore maximizing the commercial potential of CAR-T products across all settings of care in this disease. As such, we're planning to add a 20-patient cohort to our ongoing Phase 1-2 Alexander study in the second half of this year with patients treated in an outpatient setting in order to broaden our understanding of the feasibility of outpatient administration. With that, I will turn over the call to Andrew for our first quarter 2020 financial update.

19:30 Andrew? Thanks, Christian, and good morning or good afternoon to everyone. If we move to slide 15, it's my pleasure to review our financial results for the first quarter of 2020. Net total operating expenses for the three months ending March 31, 2020 were $38.6 million, that was net of grant income of $300,000 and that compares to a net operating expenses of $30.2 million net of grant income of $2 million for the same period in 2019. The increase was due in general to the continued increase in clinical trial activity which is expected to deliver on key milestones throughout the rest of 2020.

20:23 also increased headcount and an increase in public company costs primarily related to insurance. Research and development expenses increased to $31.3 million for the three months ended March 31, 2020 and that's up from $22.6 million for the same period in 2019. Now cash costs which exclude depreciation and amortization as well as share-based compensation increased to $25.6 million from $17.5 million. The increase in R&D cash costs, that's $8.1 million, consisted primarily of an increase in compensation-related costs of $2.2 million due to an increase in employee headcount that supports the advancement of our product candidates. as well as an increase of $3.7 million in project expenses associated with a clinical activity and that includes the research, process development, manufacturing activities necessary to conduct the studies plus an increase of $1.8 million in licenses, legal fees and consulting services some of which is related to an option to negotiate a future license as well as IT infrastructure and support The remainder was attributable to other additional costs in the amount of about $400,000.

21:52 General and administrative expenses decreased to $7.6 million for the three months ending March 31 and that's down from $9.6 million for the same period in 2019. Cash costs, again, which exclude depreciation as well as share-based compensation, and a decrease to $5.9 million from $6.3 million. Compensation related expenses decreased by $300,000 and IT telecommunication and general office costs decreased by the same amount and a decrease also the same amount in commercial costs and that was all offset by an increase in public company costs of around half a million dollars which primarily relates to insurance as I have previously mentioned.

22:48 Non-cash costs within the G&A area decreased to $1.7 million for the three months ending March 31 and that compares to $3.3 million for the same period in 2019. The decrease here is attributed to basically share-based compensation expense which decreased by $1.6 million as a result of the lower value of stock options that were recognized during the period. The net loss attributable to ordinary shareholders was $29.9 million for the three months ending March 31, 2020 and that compares to $27.2 million for the comparable period in 2019. Cash and cash equivalents at the end of the quarter totaled $243.3 million, and that compares with $210.6 million that we had at the end of December 2019. And as such, we anticipate that that cash on hand provides us with a runway into 2022. And with that, I will now hand the call back to Christian to give you a brief outlook on expected milestones.

24:03 Christian. Thanks, Andrew. Let me conclude this part of the management discussion with a review of the upcoming milestones and news flow through 2020. Let's move to slide 17. The upcoming eight months will be an end-full period for us with multiple clinical milestones and opportunities for value creation. Our chief and most imminent operational focus is the conduct, obviously, of our pivotal trial for autoimmune adult ALL. We expect to report clinical data across multiple programs including updated OTO3 Alexander data at the forthcoming ASCO meeting and updated OTO1 OLCAR19 data as well as OTO3 data at EHA as previously mentioned. We will look to progress a number of our other preclinical candidates through the second half of 2020 and are looking forward to providing preclinical data updates on our solid tumor programs OTO6NG and OTO7 at AACR as well as our T-Cell INFORMA program with Auto5.

25:02 Finally, towards the end of the year, we look forward to providing further data updates on both Auto1 and Auto3 as we expect for the end of the year. In conclusion, on slide 18, I'd like to recap the major messages from today's call. First, Auto1 is our first autoless program to move into pivotal stage. Given the positive safety and efficacy profile today, we believe that Auto 1 has the potential to be a best-in-class CD19 CAR-T program in adult ALL, a disease setting with a very high unmet medical need. Secondly, with regards to Auto 3 and DLBCL, which is expected and slated for additional clinical data updates at ASCO and DHA, we plan to conduct an outpatient court in the second half of this year. The company is in an excellent position combined with a strong balance sheet which provides us a run rating to 2022.

25:53 We feel we're in a good position and I think we're looking forward to an exciting second half of the year. We're now happy to take questions. Thank you. As a reminder, to ask a question, you need to press star 1 on your telephone. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. Your first question comes from the line of Chad Messner with Niehammer and Company. Hi everyone, this is Gil on for Chad and congratulations on the progress in a difficult environment. So just a couple of questions from me. You discussed kind of the challenges that are related to DLBCL and hypothetically, what would you consider more important, patient accessibility or The duration and deepness of response.

26:55 Well, thanks a lot for joining. I really appreciate it. I think with regards to DLBCL, you need both aspects actually to be addressed. You need a high level of sustained CRs and you need an excellent safety profile to reach the population. Both aspects are important and we believe that we have an ability to make significant improvements on both sides of the program. So you do not consider one more important than the other in this instance? Well, you know, it's a life-threatening disease. The first thing you have to make sure is that the patient survives. So getting to a long-term remission is what the ultimate goal is. But then you also have to make sure that the patient has access to the therapy.

27:40 And right now in the U.S., there are only about 10% of the patients in that disease setting that have access to CAR-T therapy because it is confined to and the inpatient segment of the Centers of Excellence. And that has actually created a situation where while there is a big demand for these types of therapies, the actual access that can be realized is very, very small. And that is all on the actual intensity of the management of these patients during the adverse events that occur at the onset of the therapy. And that is sort of the key reason for the confinement to this relatively small number of centers. You have to make fundamentally have the impact on the disease. That is what the sustained CR rates give you. But then you actually have to have a safety profile that allows you to further expand the delivery of this type of therapy to centers beyond the relatively small numbers of academic centers of excellence.

28:38 All right. Thank you. and we are very much looking forward to seeing some of the preclinical data at the second half of AACR. I noted that it looks like auto 6NG data would be presented in small cell lung cancer. That's a very interesting indication not just because of the target but also because of the lack of immunogenicity that's seen in a lot of these cells. kind of maybe you could you know kind of orient us what kind of data we should be expecting at AACR. So at AACR what we're going to be presenting are obviously preclinical data on these from these programs. As you may remember the way we designed the programs is actually to include a set of cell programming modules that enable the cells to have a higher resilience and higher ability to cope with the challenging microenvironments that we find in these particular sets of tumors.

29:42 And that is going to be a key part of the data that we're going to be presenting is the use of those modules in those settings and the impact the modules have to actually give us an appropriate level of activity in these, as you point out, very challenging tumor environments. Excellent. And just some kind of a last clarification, you're expecting to complete enrollment in the pivotal study by year end 21? First half next year. First half next year. First half next year with data at the year end for next year. Okay. Thank you. That's what I thought. Thank you for taking my questions and congratulations on your progress.

30:32 Thanks a lot. Thanks for joining. Thanks very much for taking the question. If I could just ask, on the Auto3 outpatient program, can you just talk a little bit about what the profile of that patient would look like relative to inpatient, you know, within, to the extent that you can discuss protocol on that basis? And then just also, if I could drill in a little bit on the sort of go, no-go decision. as well, expected later in this year, and the decision tree that will help you get to making that decision, if you could discuss that. Yeah, hi Mara, thanks for joining. So in terms of the patients, the patients actually we don't expect to look different from the patients that we've treated so far.

31:29 The reason why you treat the patients in an inpatient setting with the current CAR T programs is not because of the state the patient is in, but it is the consequences of the toxicity induced at the onset of the therapy that you're providing. So we don't expect to see a difference in the patients. And in fact, as you can imagine, with the majority of the patients treated outside of the academic centers, the patients are in a reasonable condition and can obviously normally be managed in oncology clinics and networks, et cetera, much more in the periphery of the healthcare system. So we expect the same patients, but obviously we're treating them in a slightly different setting than what the inpatient setting is. So this is not a difference of the patients, it's a difference on the And then with regards to decision points, obviously we're going to provide an update of where we are with the program at ASCO.

32:30 That gives us a very good view on the response rate level. We will have additional follow-up that we'd like to see which gets us into slightly into the second half of the year at which point we'll understand what the sustained CR rate looks like and that will be the key piece of information that will inform us on the path forward and as you can imagine getting the data from the outpatient cohort would also enable us to actually design a pivotal study somewhat differently including outpatients and outpatient setting in the pivotal study as well which we believe would actually be a very important component of a pivotal program.

33:21 So that data will be very informative in terms of the design of the study as well. Okay. Thank you. I appreciate it. Thank you, Mara. Our next question comes from the line of Debjit with HC Wainwright. Hi, guys. Good morning. This is Aaron on for Debjit. Congrats on the progress. My first question is, so if a no-go decision were made on Auto 3, the Phase 2 portion, would you still continue with the outpatient study of Auto 3? And what kind of learnings could you glean from that if it were discontinued? You're asking a good question, Aaron. Obviously, we have a good level of confidence around the program.

34:09 You've seen the data early in the year. As I said, we're going to be about to provide an update on the program. We feel good about the program and believe that that is an important data set to be generated. Okay. And are there any plans for outpatient studies with auto one as well? At this point in time, there is no. And the reason for that is actually the state the patients are in themselves. So this is different from DOBCO. The adult relapsed refractory adult ALL patients typically are in a very difficult situation. A lot of them are prone to sepsis as a consequence of the disease and the progression of the disease. So they're at significant risk of picking up infections. A lot of them actually have to be managed in ICUs for sepsis and other types of comorbidities.

35:05 as a part of the normal course of the progression of the end stage of the disease. So the disease is quite different. So in this setting, we obviously will treat the patients mostly in inpatient setting for the first few weeks just to have an ability to observe them and be able to help manage the disease mostly. much less so than the therapy itself. It is mostly about managing the disease here. And obviously, as I think we see a larger group of patients, we can then actually decide whether we might take a similar route as I was able to take with my previous program with glenotumor map where we could do actually a lot more of the activities outside the hospital at some point in time. But for this study, the patients will be primarily treated in inpatient setting driven by the state that the patients are in mostly, much less so than actually the consequence of the therapy itself.

36:08 Okay, thank you. Thank you. Okay, thank you. Do you have another question? Yeah, I do. So, one more. In DLVCL, comparing allogeneic and autologous CAR T approaches, So do you think that the additional three to five week vein-to-vein time could contribute to increased CRS or neurotoxicity? I don't think there is a connection between vein-to-vein time and cytokine release and neurotoxicity. If you would have a concern around vein-to-vein time or along vein-to-vein times, is that the disease may progress further. That would mean more tumor load.

37:00 More tumor load typically means is often related to more adverse events. So if there is a connection, there could be relationships there. It's not what we're seeing. It's not what we're picking up. But the relationship you're suggesting, I don't think it's there. Okay, great. All right, thank you, guys. Thanks, Christian. Thanks, Devjit. Appreciate it. Your next question comes from the line of Jim Verchanov with Wells Fargo. Hi guys, congratulations on all the progress and initiation of your first pivotal. I guess first, just on the mid-year go, no-go decision, should we expect that in concert with ASCO and EHA updates?

37:46 Is that mid-year? And I guess the second part of it is just given the strong positioning statement, the strong data we've seen so far and the commitment The commitment to an outpatient study, should we consider a no-go decision unlikely and would have to have something unusual happen between now and that decision? It just seems like you've made a pretty strong positioning statement. The data seems very strong. You're committing to further development in the outpatient setting. So just try to understand a bit more on the timing and the bias towards go, no-go. Right, so obviously we cannot guide you to the data we're about to present. There's a few more weeks to go for that data.

38:33 As I indicated, we feel good about the program. That's what you also picked up from the presentation, and that is certainly a true statement. So this is where we'll obviously provide more update at ASCO. We'll have a bit more follow-up in terms of the time. One of the key parameters that we're looking at is obviously sustained CR rates and we're going to have a view obviously for ASCO but we believe that within the third quarter we'll have I think a better visibility on kind of the full data set from the patients we've treated to date in terms of the sustained CR rate. So we'll get a very good view on that and as you pointed out and clearly The fact that we want to move forward and actually explore the potential of the program in an outpatient setting is obviously indicative of the overall positive view that we have on the program.

39:31 And then, Christian, to the extent that when we get the update at the upcoming medical meetings, there will be some need to make cross-trial comparisons, do you feel like the baseline characteristics will hold up with Yaskarta? and JCAR17. You know, I think back on when the debate between Juno and Kite was on relative tumor burden. So just maybe if you could give us a sense of tumor burden and whether you think it holds up and will allow for those comparisons on CR and durability of CR. I think that first of all, yes, on tumor burden, I think you will obviously present the data on tumor burden as well. and you'll see that this is a very comparable patient population as was reported for Ciscarta and JCAR 17 on tumor burden.

40:20 In terms of kind of the patients that we have included, I think we're tracking very nicely with the Ciscarta population. There is obviously the JCAR 17 population. It was somewhat different to what the Ciscarta population was. So we're closer to the Ciscarta population than the JCAR. In general, the Chase Carty population was probably a bit tougher population to deal with. Maybe just a final question just on thoughts on outpatient treatment. Have you done much work talking to those 80% of centers that are treating patients away from tertiary care centers and what their threshold is to move towards a greater level of comfort with CAR T?

41:09 Is 100 patients data enough to rule out the bad things in their minds? Is there an in-between scenario where a strong profile could generate more referrals to tertiary centers before communities actually pick up on it? Just trying to get a sense of level of comfort and your ability to address that with a pivotal study. It's a very good question. Any change in treatment paradigm or adoption is actually a process that will take some time and will require a buildup of confidence. That is true when you start with your KOLs and the experience they make, and then that experience starts to propagate outwards.

41:55 It's a process where we expect to go from The University Hospital outpatient setting which is one of the categories of outpatient to the non-university hospitals outpatient setting and then you can actually move from there. You have to expect that that will be sort of a gradual motion through the various types of centers and with that obviously you gain a lot of experience not just from a pivotal study but then also from the ongoing experience going forward in terms of the real-world data that will actually continue to support the rollout and the capture of that opportunity in full. All of these therapies, particularly new therapies, take experience, which is personal experience, with the product, and that needs to be developed, that needs to be rolled out appropriately.

42:48 Great. Thanks for taking the questions, and congrats again on the progress. Thanks a lot, Jim. Much appreciated. Your next question comes from the line of Byron Ann, which air freeze. Yeah, hi guys. Thanks for taking my questions. Maybe I could just start on the auto three outpatient cohort. Are you planning to dose the outpatient cohort with Pembrolizumab? And then I guess on that, what are your thoughts in terms of this data that we're expecting soon mid year? and should we be comparing these data to the Zuma 6 data which were presented at AACR recently where I think they saw a 46% CR rate and a 75% ORR rate. So I guess if you could address those questions.

43:42 Yes, hi there and thanks for joining. Obviously the way that we're treating the patients is that We're giving a single dose of Pembro on day minus one, and that is going to be in any of the settings. Obviously, the nice thing about this approach is you can sort of bake it into the preconditioning regimen, which is a three-day regimen, fluci regimen, so you can build it in, and it can actually be nicely integrated in any setting, frankly. With regards to what we need to look at, I think the data using the PD-L1 monoclonal with Giscard that didn't seem different in any significant way from the Giscard data in the absence of the PD-L1 monoclonal so I think we'll just look at the Giscard data as it stands whether it's the original Zuma trial or the Zuma 6 trial I think they're relatively close together and there's not an indication I think that the addition of PD-L1 monoclonal has increased or changed profile.

44:50 So it's going to be against the JISC-ARTA data as we know it today, which I think is very consistent. So that's what we'd be comparing to and what we're looking at and what we at this point clearly is the most significant data set as we could tell from an efficacy perspective in the space. So if pembrolizumab doesn't provide any additional contribution on efficacy Why not evaluate the outpatient cohort without PEMBRO? I'm sorry, that's not what I said. I'm not sure what you're concluding. Well, I think the Zuma 6, if you look at the cell kinetics, and when they showed us the data on Zuma 6 versus Zuma 1 cell kinetics, there wasn't really much of a change.

45:39 and one would have concluded that maybe you get better cell kinetics with Enzoma 6 because you have Pembrolizumab on board. There wasn't Pembro on board, was it? It was Atezo. Well, Atezo, sorry. I mean PD-1. Yeah, the interaction is not at the same place. We're acting on the T cell, on the CAR T cell. Atezo acts on the tumor cell. So it's not necessarily the same biology to begin with. PEMBRO has additional impact on the T cell itself. So what we're seeing is obviously, and this is what we'll be talking about, is what we'll be looking at the sustained CR8 and you'll start to get a view of that at the ASCO presentation coming up. And that's probably worthwhile having a look at.

46:33 And as we go forward, as indicated, we will include PEMBRO as part of the preconditioning regimen, which is a single dose of Pembro, which obviously on its own doesn't have an impact on the lymphoma as an agent itself. Okay. And then I guess just one more on the outpatient cohort. I guess what are your plans for treating the grade one to CRS? Are these patients going to be truly outpatient like, you know, Will they be able to go home or are they going to be at a separate facility outside of the hospital? Well, that varies a lot depending on the institution. Typically, if it is associated with an academic center, those are basically facilities relatively close by to the center that could be set up like a hotel as an example. where patients can actually you know be managed and obviously if need be they could be sort of you know looked at in the context of the of the of the hospital itself that's one set of settings and then obviously the more distant settings and you know going out as we're obviously collecting the data on the feasibility on and and the experience with it obviously what you want to make sure is you capture the data what is the Thank you.

48:26 Okay, thank you very much. All right, operator, do you have any more questions? Your next question comes from the line of Matt Phillips with William Blair. Okay, thank you. Hi, guys. This is Rob. I'm for Matt here. Thanks for taking the questions. Just a very quick one on the outpatient setting again, the additional cohort that you're planning there. Is the idea to move the pivotal study kind of entirely into the outpatient setting?

49:18 Should that be, you know, should you make a good decision on that one or is that still going to be kind of at the discretion of participating centers there and then maybe if I could just quick one on auto four you know it was good to see some initial data um start of the year there how's enrollment been on on that auto four study and and you know maybe what can we expect uh in data at the end of the year is there likely to be enough uh to make a decision on auto five and you know maybe if possible a bit of a outlook of that program into uh 2021 following on from from that data there if possible thanks Hi Rob, thanks for joining. With regards to the design of the pivotal study, what you want to make sure is that you have an ability to include centers that treat patients in the outpatient segment as part of the pivotal study. That was the idea, to be able to do that.

50:12 So there will be a mix of patients that will be treated in an inpatient and patients that are in an outpatient setting. But you want to generate sufficient data that gives you then an ability to move forward with the broader population and the broader treatment settings based on the data you generate in that study. So that's the first part and the first question. The second question related to OTOFOR. OTOFOR was somewhat impacted by the current COVID situation and the challenges that we had in terms of the within the UK where we had obviously hospitals had had to shut down the treatment for cancer patients that they were impacted. We were not impacted with auto 3 because we basically could keep on operating in the US at the same time.

51:02 But auto 4 is predominantly operating as a clinical trial within the UK and therefore we have been impacted. We're in the process of evaluating what the impact is. I think it's difficult to guide at this point in time what level of impact we'll have. and we'll guide probably later in the year once we have better visibility what we can expect by the year end. Great, thanks very much. All right, thank you very much. Our next question comes from the line of Greg Slinovich with Goldman Sachs. Hey, good morning or good afternoon. Thanks for taking my questions and congrats on the progress. I've got three questions if you don't mind. Again, just focusing on the outpatient opportunity.

51:47 Any sense that you could give us, I know it's early days, but kind of what the incremental magnitude of the revenue opportunity could be versus the inpatient setting? And then my second question, I just wanted to get an update on the allogeneic program. I'm super interested in that. And if you could remind us how that program and how you're engineering that program The candidate, how it might differ versus other approaches from other allogeneic companies. And then lastly, I just want to touch upon manufacturing. Can you just give us an update on where you are on the manufacturing side in terms of capabilities and scale up and if there are any, what are the next key internal milestones you're looking for in terms of getting the company where you think it needs to be? Thank you.

52:43 Hi Greg, thanks for joining. I would say that first starting with the Auto3 program and the question in terms of the impact on market potential. When you look at the Centers of Excellence inpatient segment, which is where currently the CAR-T therapies are being used, that represents 10% of the actual commercial opportunity within the DLDCL third line setting in the US. So asking the question differently, in terms of the increase, there were 90% of the market that we're looking to find a way to actually get tapped into. There's an enormous opportunity way substantially beyond the current profiles that we're seeing and the current opportunities that are sort of being visible from the CAR T sales that you're seeing because they're literally catching about 10% to 11% of the total.

53:40 So that's, I think, hopefully gives a sense for the importance of having a profile that allows you to go beyond the sense of excellent inpatient setting. With regards to the manufacturing question, obviously we have been able and continue to manufacture throughout the peak of the COVID crisis. I think which gives you, I'm sure gives you a good sense of the ability that we've developed now to be able to deliver including managing the complex supply chain in the US with a vast reduction in commercial flights and that was still feasible. So we feel good about where we are on the manufacturing side and our ability to deliver for our clinical studies and also are now gearing up to the full conduct of the pivotal study and as well as other activities on the clinical side as we've alluded to in the context of the presentation. So we're on track where we want to be with the manufacturing and have been able to consistently deliver product even in the current environment, which certainly was a challenge for everyone in the business, in our larger business, I think for every one of the companies.

54:59 The final question was related to some of the technology that we started to show at the beginning of the year related to an ability to expand and the technology towards the allogeneic side. What we have shown at that point in time is a programming module that renders the cells in a state where there's no T cell receptors left on the surface, so actually you avoid graft versus host disease. We'll do that with, in essence, a capturing protein in the secretory pathway that captures the newly formed T cell receptor CD3 complexes and actually shuttles them back to the ER for degradation. That turns out to work very nicely and we've shown, I think, a very nice set of graft versus host disease models that showed the utility of that.

55:52 And we're working with our colleagues at the academic side to start up a study towards the end of this year to first explore the utility of that module. So that's sort of where we are in that program, further elements of the technology we haven't yet discussed. And your final question comes from the line of Samuel Leather with Polygon Global. Thanks for the call, and it seems like a really good update, so I'm happy to hear that for sure. Two quick questions. One, could you be really kind and just give us a reminder of, you know, sort of approximate cost savings that treating patients and also three in an outpatient setting would bring against sort of the total cost of treatment?

56:56 and two, it's interesting to see Martin Pule is going to be talking at ASCCET the presentation coming up I think next week about some optimization techniques he's been using using also one product and I was just wondering are there further manufacturing tweaks that can be still brought in at this stage of development across the programs It seems very interesting, but I just wonder how much flexibility the FDA will give you changing manufacturing processes at this stage. Thanks a lot. Thanks, Dan, and thanks for joining. I'll start with the second question.

57:45 In terms of the manufacturing processes, obviously there's a certain degree of improvements you can make. that allow you to stay within still the same product and you can do obviously quite a bit of work as you go through the early stages of development as you point out once you get into a pivotal study you obviously want to be sure that the process you're running actually remains consistent throughout the trial so that indeed you have a proper integrity of the data set so To that part of the question, you don't want to move or change your manufacturing process in a pivotal study. You want to actually keep it steady and make sure that there's a consistent data set.

58:30 With regards to, in general, process improvement for CAR T therapies, very clearly lots of ways on how you over time can improve processes, not that dissimilar to what we have seen Thank you very much. for optimization as a cell-based manufacturing process. But you're absolutely right.

59:18 You don't want to run changes through a pivotal study. That would not be a good idea because it risks the integrity of the study. So that's the second question. The first question you asked was about the cost related to the management of The safety aspects for the treatment of CAR T patients. And the question is a very relevant one. It's not that easy to quantify that precisely for each of the centers. But what we can say is that it's been a major issue within the US centers that that extra work, that extra effort that had to be put in to manage the patients, put them in ICU, etc., was not properly covered in the current reimbursement schemes and is still not.

1:00:10 It was a problem early on and it continues to be a problem. The amount of reimbursement that the hospitals can get for the management of the patients is still not sufficient, which is certainly not only an issue in terms of resource use within the hospital, but also is a financial burden on a lot of the hospitals on top. and that remains a problem despite the fact that there is a certain level of compensation or reimbursement that is built in within the US but it is not sufficient to cover the cost. I don't think I can give you an exact number at this point in time Dan but I think the statement that indeed it is a loss making operation for many of these vendors is a true and remains a true statement.

1:00:58 That's very interesting. So has it been quite easy to find people who are interested in doing the outpatient setting in terms of going out and finding the new clinics? It is obviously an interesting thing to do also because even if you run an academic center of excellence, if you have a lot of resources bound by an individual patient, it means that there is just less other patients you can care for. so resource use is also a challenge and it's an issue also in academic centers so the interest is equally big whether this is on the inpatient or the outpatient side to actually limit the amount of resources that are needed to sort of manage the patient through and if you can then actually further relief that burden by having an ability to actually move the patients out of your normal wards that in addition actually is a support and significant help for actually any of the centers or practices.

1:02:04 Okay, thanks again very much for the call. Okay, thank you very much. Appreciate it. And then of other questions at this time. All right, well thank you very much. I'd like to thank everyone for joining. Looking forward to obviously keeping you updated through a very busy second set of the quarter with obviously several calls that we're planning to update you on the data presentations at ASCO, EHA, and the second part of the EACR meeting. With that, I'd like to wish you a great day and looking forward to connecting with you obviously over the next few weeks. Thank you. Bye-bye. This concludes today's conference call. Thank you for your participation. Have a great day.