Ladies and gentlemen, thank you for standing by, and welcome to the Gilead Sciences Conference Call. At this time, all participant lines are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Douglas Maffei, Head of Investor Relations.
Thank you. Please go ahead.
Thank you, Shannon. We appreciate everyone joining us on such short notice for today's call to discuss the exciting acquisition of 47 announced earlier this morning. The speakers on today's call will be Daniel O'Day, Chairman and Chief Executive Officer Mehrdad Parsi, Chief Medical Officer and Andy Dickinson, Chief Financial Officer. Also on the call is Joanna Mercier, Chief Commercial Officer. Before we begin, let me remind you that we will be making forward looking statements that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those referred to in any forward looking statements.
Those risks and uncertainties are contained within our joint press release, presentation and latest SEC filings of each company. I will now turn the call over to Dan.
Thank you, Doug. Good morning, everybody. Thank you for joining on such short notice, and we are very excited to review the opportunity here today. We wanted to articulate why we think this is such an important acquisition for Gilead and provide the opportunity for any questions and comments that you may have as well after our prepared remarks here. So I'll talk a little bit about the rationale and Mirdad will speak about the novel science that's at the heart of this acquisition and the potential for addressing some significant unmet patient needs.
And then Andy will discuss the structure of the deal and then we'll open it up to some questions. So first and foremost, this is really at the sweet spot of our strategy that we've just rolled out a month ago. As I've said several times, our business development is going to be focused on our core areas of expertise, where we have knowledge in house, virology and the field of immunomodulation. And in oncology, we said we'll focus specifically on immuno oncology. We also said that we would keep the bar very high, building the pipeline with a sense of urgency, but only pursuing the highest quality science with a focus on clinical stage assets.
47 fits that profile perfectly from my perspective with leading expertise in a promising area of immuno oncology, the targeting of CD47. The lead molecule, magrolumab, has shown particularly promising efficacy for 2 hematologic cancers, myelodysplastic syndrome or MDS and acute myeloid recruitment for leukemia AML in combination with chemotherapy. There was significant interest in these data when they were presented at ASH in December. In fact, I was there with our KITE data as well and the 3 year data and the MCL data from KITE. Megrolumab could be a 1st in class therapy based on a novel MOA and emerging clinical data.
So you also may know that MDS and AML are 2 diseases with a high unmet need. There have been no new therapies in MDS in the United States for more than 13 years. It's a big patient need here. So we also see multiple opportunities with these two lead indications, and as well as other indications that are already in development such as NHL and multiple myeloma and eventually the opportunity and the potential to go into solid tumors. I would just note out that magrolimab's mechanism of action also lends itself to combination with other therapies, chemotherapies, antibodies and potentially other immunotherapies, which is at the core of, as we know, our oncology strategy and the oncology strategy of the industry to look for combination therapies to get higher sustained responses with longer duration.
So putting this opportunity into context of our existing clinical pipeline, migrolumab expands our presence in hematology with a non cell therapy asset. I think this, in fact, complements KITE cell therapy franchise. And then in the broader sense, our combined immuno oncology pipeline covering KITE cell therapies and our emerging novel non cell therapy has 15 clinical programs today before we add migrolimab. And this number would bring it up the number of programs today up to closer to 20 with some importantly late stage additions with megrolumab and allows us to have a market entry in oncology outside of cell therapy much sooner than our current portfolio. So the 47 acquisition adds significant potential with what could be a foundational asset with transformational benefits.
And then finally, before I hand the call over to Mirdad, I also just want to comment on the 47 team. They're a highly experienced team of individuals with complementary expertise and great mutual respect. They also happen to be very geographically close to us, which is terrific in terms of our cooperation. And a lot of experience and a lot of respect for Mark, their CEO and the team over there that I've gotten to know in the recent past. So we're all excited to be working with them to make the most of their terrific progress to date.
With that, I'll turn it over to Murdad to cover the science in a bit more detail.
Thanks, Dan. Yes, I just want to echo what Dan said about how impressed we've been by the talent and scientific rigor that the 4,000,000 team has had as we've gotten to know each other and all the work they've done to get, migrolinab thus far. The team and I are really looking forward to collaborating with this group of great scientists, and we continue as we continue to progress this for the patients who really need new treatments with this disease. As Dan mentioned, the 4,017 team shared some data at ASH last year that showed really significant promise for both NDS and AML. And these are disease where there really is continues to be a tremendous need for new medicines.
And as an example, patients with high risk NDS have a median survival of only in the 1 to 2 year range. As we try to strengthen and expand our clinical pipeline in line with our strategy that you've all heard of, this is exactly the kind of deal that we are looking for that will help us achieve our ambitious goal of bringing 10 transformative medicines to patients over the next decades. Early trials evaluating megrolumab in combination with standard a carrier zacitidine really demonstrate a strong response and durability in patients who've been treated. Additionally, the safety profile looks to be really well tolerated and the dosing regimen that 47 is devised for magrolimab really demonstrates an ability to mitigate anemia as a side effect. So due to the increasing efficacy and the ability to safely combine, this is really what we're excited about in terms of the potential for magrolimab to extend the duration of therapy compared with azacitidine alone.
The mechanism of action is really interesting for migrolimab, and it really represents a new approach to cancer therapy. As you may know, migronimab works to help immune cells to engulf and kill cancer cells. Cancer cells are and
they then immune cells get
engaged, and they And they then immune cells get engaged, and they initiate the phagocytosis and the killing mechanism of these cancer cells. Certain chemotherapies, including adacitidine, can cause cancer cells to express these signals and target them for phagocytosis, so called eat me signals. Research done at Stanford by Ravi Majety and Irv Weissman showed that cancer cells can express a cell surface protein called CD47. And this protein sends signals to inhibit phagocytosis or donate any signals. The Stanford researcher showed that by blocking CD47, the immune cells could better phagocytosis and kill cancer cells.
The researchers also demonstrated CD47 expression is an increase in many types of cancers. Combining migrilimab with azacitidine may create a synergy where we see both an increase of the signals caused by azacitidine to initiate phagocytosis, phagocytosis and then the treatment with megrolumab can block the inhibitory signal, the inhibitory signal for phagocytosis caused by CD47 and therefore we get better killing of the cancer cells. So the mebrolimab binding to and blocking of CD47 on tumor cells gives another positive EB signal for the immune cell to engulf and kill the cancer cells. And 47 has really designed megrolumab very specifically to have this extra signal to boost the eat me signal. So the data presented publicly at ASH really support both an improved response rate over azacitidine therapy and tolerability that supports continued development.
And this profile really supports our belief that migrolumab could be a best in disease therapy. It's an important addition to our clinical oncology portfolio, and migrolumab really fits well with our approach to build transformative therapies across complementary immuno oncology platforms, both in cell therapy and in non cell therapy. We've been building our portfolio here to be a differentiated immuno oncology portfolio that is exemplified by both our internal programs such as PD L1, the anti CD73 TGF beta bifunctional protein we are working with from Agenus and now 47 that further complements this portfolio with the addition of potential therapeutic targets an innate immune mechanism that's not covered by our existing portfolio. Given the early promising results that we've seen with migrolumab across several hematologic malignancies, there may also be other synergistic opportunities that complement KITE down the road and in the future. We'll continue to pursue deals like this.
These are exactly the kind of external opportunities that we are looking for in oncology to ensure that we at Gilead have access to the best scientific innovation to advance medicines for patients. We're looking forward to working together with our new colleagues at 47 to advance migrilimab as rapidly as possible for patients. Before we get to questions, let me hand over the call to Andy, and he'll review the deal terms briefly.
Thank you, Murdad, and welcome, everyone. As you've seen from our press release that we issued this morning, Gilead and 47 have entered into an agreement whereby Gilead will acquire 47 for $95.50 per share for a total purchase price of approximately $4,900,000,000 I'm pleased to share that the transaction was unanimously approved by the Board of Directors of both companies. And thanks to our strong balance sheet, we have the financial flexibility to be able to fund the purchase entirely with our cash on hand. As a reminder, our cash and marketable debt securities balance at the end of 2019 was 25 $800,000,000 We expect that the deal will close sometime during the Q2, subject of course to regulatory approvals and customary closing conditions. In addition, as you might expect, we're not providing any updates to our 2020 financial guidance at this time.
We plan to update our guidance after the closing of the transaction, likely on our Q1 earnings call. As you can appreciate, given migrolimab's stage of development and the investment required to maximize the potential of the therapy, the transaction is expected to be slightly dilutive to earnings over the next several years. We retain significant capacity for additional transactions to continue to expand our pipeline, and we will continue to pursue partnerships in small to medium sized acquisitions in pursuit of innovative science. Let's now open the call up to questions.
Our first question comes from Michael Yee with Jefferies. Your line is open.
Hello there. Colette on for Michael Yee. Just had one question here. Just wondering if you can speak to the complementary nature of this drug with your other drugs that you currently have in your pipeline. So for instance, Yescarta, are you thinking about combo therapies or combination clinical trials going forward?
Thank you.
Hi, Michael. Thanks for the question. Yes, so we are definitely looking at all those possibilities. It's certainly one of the reasons we're interested in this given the indications where the molecule has already been evaluated. In the short term, this is really focused on MDS, and I think that's where our short term focus will be.
As you know, there are studies ongoing and data being generated in DLBCL, and that's one of those areas where I think you could imagine that there could be synergies and other possibilities when we think about KITE. So that's definitely on the radar.
Thank you very much.
Our next question comes from Brian Abrahams with RBC Capital Markets. Your line is open.
Hi, guys.
Thanks so much for taking my question and congrats on the deal. Just wondering if you could expand a little bit on your view of the overall safety and the differences you see versus other CD47 pathway approaches? And then would love to hear more also about the path to market and potential timelines here and any new trials you might anticipate starting once the deal closes? Thanks.
Sure. This is Murde again. I think for us, one of the key things that we're excited about for 47 is that how far advanced the program is in MDS and I think in AML. And I think that gives us a significant advantage in terms of moving forward. Additionally, I think, as you alluded to, the safety profile, they've done a really great job of optimizing the dosing to really minimize adverse events.
And I think that's one of the other reasons that we're really interested in the molecule. So given the tolerability profile of what we've seen and you'll see more of these data at ASCO, I would anticipate. We think that we have a really great combination of efficacy and safety. The risk benefit here looks to be really good, especially in these patients. So that's one of the key things that we were interested about in terms of moving the program forward.
In terms of path to market, we're looking at the existing studies and those are ongoing. There's an opportunity for accelerated approval here that would be sort of in the latter part of 2022. So that's sort of the time frame we're looking at. Obviously, that depends on the data and whether accelerated approval would be okay. If not, then we'd be looking a little bit farther out, but that was one of the key things that we're interested in MDS and AML is the ability to get to market relatively quickly.
Thanks very much.
Our next question comes from Geoff Meacham with Bank of America. Your line is open.
Hey, guys. Congrats on the deal and thanks a lot for the question. Just wanted to ask you on the other assets. So when you look, obviously, 47 is foundational to the transaction, but how much value was described, so 174 or 189? And when do you think you'll be in the clinic for those assets?
Thank you.
Yes. I think we definitely see the other assets as really being interesting and work that we would pursue. I think it'd be difficult to say value until we get into the clinic. So we'll both those molecules are accelerating towards the clinic. And I think once we start to see some clinical data, we can ascribe more value to those as that comes along.
Thank you. Our next question comes from Jeff Porges with SVB Leerink. Your line is open.
Just a couple of logistic questions for Andy. First, Andy, was this a competitive process? And do you have significant breakup fees in place? Secondly, could you talk about what retention you have in place for all the key employees at 47? And what proportion of the 65 or so employees do you expect to be retained?
And I'm going to throw this question in there, but I can't know what you're going to say. But since this is an open call the whole management team is there, could you give us a sense of whether you're seeing any promise with the remdesivir trial? And if not, how will you communicate that to both investors and to the public? Because obviously, there's just a huge amount of interest in that and we haven't heard from you.
Thanks, Jeff. I'll start and on the yes, it was a competitive process as you might expect. Obviously, the details will be set forth in the company's 14d9 filing. There are standard breakup fees that are associated with this. Again, the details will be released in the coming days as the merger agreement is filed.
And then as Dan said and Mehrdad alluded to, the team at the company is an exceptionally good team and we're really excited about working with them. So as is the case in most of our acquisitions, we're deeply focused on retaining the key employees and working with them going forward on these programs. So we're not providing any specific details on that front, but it's something that we're focused on. And again, the team and the quality of the team was a significant driver for us in this transaction.
Great. Thanks.
Yes. I'll just add a bit, Jeff. I mean, I could only echo where Andy left off. And obviously, I'll be working closely. We'll be working closely with the 4,017 team to put programs in place to incentivize the employees there to keep on with their work.
Of course, between now and closing, they're completely independent and will only begin to plan. But at the time of closing, we'll be well prepared to make sure we have programs in place to retain the talent. On remdesivir, yes, I think clearly, I think you probably know the status, which is we have 2 clinical trials now recruiting in China, both around 400 patients each, placebo controlled randomized clinical trials with remdesivir. They are enrolling in severe patients in 1 and more moderate patients in the other. We've recently also began the initiation of additional trials, one with NIAID, which will get going here soon and then 2 additional trials that Gilead is sponsoring that would be placed in different Asian countries, Europe and other parts of the world.
There would be INDs that we're responsible for. So we don't know yet the clinical effectiveness. We know we have in vitro activity here and it just really depends upon the nature of the recruitment. But as I've said and we've said publicly, we expect to have more color on that in the April timeframe and we'll certainly keep you informed. In the meantime, we're engaging our manufacturing supply chain in the event of success to be able to supply this medicine to patients with the coronavirus if we do get clinical success.
So that's where we're at right now Jeff with that.
Great. Thanks for that answer. And apologies for asking the question, but you can understand more.
Not at all.
Not at all. It happens to be another topic we're working on right now in parallel.
Thank you. Our next question comes from Matthew Harrison with Morgan Stanley. Your line is open.
Hi. Thanks for taking our questions. This is Zheng on for Matthew Harrison. On AML, what are your thoughts on expanding the clinical programs? Would you only look at the P53 population or maybe go broadly?
Sorry, yes. So we are at this point, I think we're going to look pretty broadly in AML. The data so far have been really promising, and there's no reason to restrict at this point. Obviously, that will be data driven as time goes by. But at this point, I think we're going to be looking particularly in the unfit AML patients and in particular the TP53 positive patients.
So we do think that that's going to be a promising for us down the road given where the data are today.
Okay. Thanks.
Thank you. Our next question comes from Umer Raffat with Evercore ISI. Your line is open.
Hi, thanks so much for taking my questions. I had a few for Mirdad, if I may, and one for Dan, if that's okay. Mirdad, I know the Phase Ib, the potentially pivotal cohorts using every 2 week dosing, but the prior data at ASH was using a weekly dosing. Are you comfortable with that strategy or would you look to make a change? That's one.
And then also, I noticed the press release only mentions the registration cohort and MDS and not the one in DLBCL, even though 47 had talked about DLBCL being potentially pivotal as well. Do you think that to be the case? And on that same note, we know some of the emerging 47 targeted therapies are have highlighted Fc effector function to being key in managing some of the talks. Do you agree or disagree with that? And then just a very quick follow-up on an earlier question.
Do you believe Gilead can supply something in the range of 500,000 patients worth of remdesivir if that's needed by this summer or fall? Thank you.
Hey, Rob. Yes, Brett, nice broad set of questions. So let me try to get through answering them all. I appreciate it. So the Q2 week dosing versus Q week, that's definitely being evaluated, right?
And I think we'll be looking to see whether Q2 week from an efficacy standpoint compares favorably with weekly dosing. So that's I think we'll be looking at both. Obviously, from a patient convenience standpoint, every other week is going to be better, but we want to make sure we don't lose efficacy in making that transition. So we're going to be evaluating that. It's early days.
So we'll keep evaluating that as we go forward. In terms of DLBCL, it is excuse me, it is ongoing. And I think that certainly, we feel that the data in MDS and AML are more advanced and allow us to be more excited about those data. I think the LBCL will continue to run those studies and see how that evolves. Certainly, if that looks good, we'll obviously want to make that a pivotal cohort as well.
But that will be, again, in a data driven way. The Fc effector question, yes, we've looked at that across the molecules. And of course, that's a hypothesis that's out there. In terms of, to your point, managing the safety, what we've seen in the data when we've looked at it and you've seen and will continue to show again at ASCO is that I think from a toxicity standpoint, mirolimab has been well tolerated so far. We've not seen problems with the based on what I would the FC fragment at this point.
So I think we're pretty excited about where we are. So hopefully that addresses those questions. And then on the remdesivir, as Dan mentioned, we're working really hard on supply chain and doing a lot of work at risk now to try to supply as much drug as we possibly can over the next several months. So I think we are waiting for the data to be generated to demonstrate efficacy and at the same time doing a lot of manufacturing work to try to support as many patients as we can.
Yes. Umar, thank you. Thanks a lot, Mirdad, for that. I just would emphasize what Merdad said on remdesivir. I think there are a variety of different scenarios depending on moderate, severe, depending on the clinical data.
So what we're doing is we're creating as much optionality in our supply chain as we can and those trigger points will allow us to determine the demand. Right now, the demand is really unknown as are many things about coronavirus. But rest assured that we're doing everything possible, not only within our own supply chain, but within our partner supply chain around the globe to ramp up when we get to those trigger points. So more soon on that and it will be driven by clinical data need, but we have teams of people that are preparing for this should we be able to contribute to the human need.
Thank you.
Thank you. Our next question comes from Cory Kasimov with JPMorgan. Your line is open.
Hey, good morning guys. Thanks for taking my question. Just I'm curious how you're broadly thinking about competition in the CD47 space and what about migrolumab do you see as most differentiated of this asset?
I think put simply, they have the most mature data set in NDS and AML. I think they're substantially out ahead. I should say we, I guess, but substantially out ahead with mongrelimab, and I think that's probably the most differentiating thing. So I think that was what got us really interested in moving forward, the confidence in the data set that's already been demonstrated. I think just going back to the question that was brought up earlier about safety, I think the other thing is they've devised this dosing scheme that really helps appears to be helping mitigate adverse events.
And I think that combination of tolerability and efficacy seems to be and the data they've generated already, seems to be putting them up farther ahead. It's a nice molecule.
Thank you.
Thank you. Our next question comes from Mohit Bansal with Citi. Your line is open.
Hey, guys. Good morning and thanks for taking my question. So if I look at your oncology pipeline combined with CAR D therapies, it seems like you are heavily focused on hematology at this point. Is this your sweet spot and this is where we should expect more deals in the future? And then the second part is, what would it take for CD47 to be effective in solid tumors?
What kind of combinations you could be thinking about? Thank you.
Yes. Maybe I'll start and then turn it over to Mehrdad. So I'm really happy you pointed that out Mohit. I mean, I think at the end of the day, we think broadly in immuno oncology between hematological disease and solid tumors. And our strategy will continue to pursue both, just as it does in our early stage portfolio here, particularly outside of KITE.
Having said that, I think building up critical mass in hematology is the strategic advantage for us. And we'll leverage that as Mehrdad said before. So, no, it's not exclusive to hematology, but yes, we like the concept of having critical mass in hematology as well. Mirdad, do you want to add any more color to that?
No, I think that's exactly right. It's a good place for us. I think, as you know, it's a solid place where we have and are building more and more expertise. And I think just to talk about the solid tumors and follow-up on your question on CD47 specifically, yes, I think we're definitely going to be exploring the utility of CD47 in solid tumors more. I think to your point, I think figuring out what it's going to take to be able to show significant benefit, especially in terms of partner molecules that might induce sensitivity to CD47 inhibition.
I think those are going to be questions that we'll explore. And that should address the first question of whether we're interested in solid tumors. We're definitely going to this will be another example of where we'll be looking at solid tumors going forward.
Great. Thank you.
Thank you. Our next question comes from Alethia Young with Cantor Fitzgerald. Your line is open.
Hey, guys. Thanks for taking my questions and congrats on the deal this morning. I wanted you to talk maybe a little bit about your strategy since you're emphasizing MDS, your strategy in the lower risk to relapsed refractory. I know that 47, that was kind of the mid range focus. And then, just another question on higher level.
Should we think about the size of deals that you're kind of doing in this neighborhood or is there a possibility to push up to a potential kite size deal? Thanks.
Let me take the first question. I think, yes, to your point, I think we'll be looking across, I think, a lot of the different patient subtypes for efficacy. So we see a really broad potential for the molecule and something that we want to make sure we go forward with. And so certainly, we'll look across MDS, we'll look across a number of AML populations. And then then I think we're going to be exploring other hematologic malignancies.
We'll probably look at things like multiple myeloma and, as I mentioned, solid tumors. So we really that's what has us excited about this molecule is just sort of the breadth of what we can explore and where we've already started to see some signals of activity. So definitely from that standpoint, that's something we want to continue to do. In terms of size of deals, I think this is what we've mentioned. I'll hand it off to Andy and Dan.
But this is sort of the size of deal and the kind of deal that we've talked about doing for a while, and I think it should confirm what we've been saying. And I do believe that these are the source of deals that we are targeting. We're always open in an opportunistic way to different deals, but those are going to be very opportunistic on our part in terms of finding just the right thing to do that kind of thing. Maybe I'll hand it off to Andy and Dan
Yes. Thanks, Burdad. Hi, Alethia. I would say this deal is in the sweet spot of and you've heard, I think, a clear and consistent message since JPMorgan that we're going to be pursuing ordinary course partnerships, potentially another large transformative partnership, as well as small to medium bolt on deals. In my mind, this is a medium bolt on deal around a great set of assets, not just a single asset, including one asset that's in the clinic.
So clinical stage assets like this are right in the sweet spot of the strategy and you should expect that we'll continue to look at transactions like this. So I think going forward, the focus this is right within our focus. We will, as we've said before, look at larger transactions as well. The bar is incredibly high for large transactions at this point, and it's more likely that you'll see us continue to implement a strategy of completing smaller to medium sized acquisitions. So, stay tuned.
Thank you. Our next question comes from Salim Syed with Mizuho. Your line is open.
Hey guys, thanks so much for the question and congrats on the deal. Just one for me on the size of first line MBS. It seems like from an investor standpoint that there's quite a bit of a range of how investors are looking at the opportunity there. Is there any additional framework you can provide either sales or patient numbers that you can give us to help us think about how you are thinking about this opportunity here? Thanks so much.
So maybe I'll take that one. It's Joanne on the line. Thanks, Helane, for the question. We do believe that actually in terms of patients, if you think about it, it's about 14,000 patients in the U. S, maybe about 20,000 in the EU5 that are diagnosed with MDS every single year.
About 40% of that in the U. S. Are actually high risk, and that will be the first indication. But obviously, as Mehrdad mentioned earlier, there's an opportunity potentially to look at the low risk as well as relapsed refractory. So we believe this is a really high unmet medical need, clearly in the high risk, but also in the other potential indications, because the survival rate is so low.
It's only 1 to 2 years in that high risk population. So we're really excited about the opportunity and meeting that high unmet medical need hopefully with this compound.
And maybe the only thing I'll add is probably underlies your question. I think this is one of those areas where given the limited treatment options and the efficacy safety profile of what's out there, there may be an underestimate of how where this can go as better treatments become available. So that's something that we'll probably learn as we get farther into this and build on the profile of the molecule.
Would you guys be willing to provide some sort of color in terms of dollar opportunity, even if it's a range?
Not at this point, Liam. So we don't at this point, it would be premature for us to provide any commercial guidance as you'd expect.
Okay. All right. Thanks so much guys. Appreciate the color.
Thank you. Our next question comes from Phil Nadeau with Cowen and Company. Your line is open.
Good morning. Congrats on the deal. Thanks for taking my question. Just a couple for Murdad to drill down on the path forward. I think 4 to 7 had been saying it kind of had a 2 pronged strategy to get the drug registered in MDS.
1 was on the Phase 1b data, the CRA in duration response was long enough and then the second would be on the ENHANZE trial. Is that also your understanding of how it could be approved? And secondly, if so, what can you give us some idea of the CR rate and duration of response that would be necessary
to file off Phase 1b data? Thank you.
So yes, I think that is I see the strategy being a continuation of a great job the 47 team has done to date, and I think they've really plotted out a really nice path. So that is exactly as you outlined how we're thinking about going forward. In terms of the second part of your question, in terms of CR, yes, look, I think the CR rate that's already been demonstrated in that you saw back in at the ASH presentation, I think that's a pretty impressive CR level. You know as well as I do that often as you extend clinical trials, those numbers will start to settle in a little bit better in terms of where a broader patient population will land. But I think if we're in the ballpark of what we've already seen from them, that would be, I think, highly supportive of going for that accelerated approval approach.
That's helpful. Thank you.
Thank you. Our next question comes from Robin Karnauskas with SunTrust. Your line is open.
Hi, guys. Thanks for taking my question. There was my voice a little bit. It's losing it. So, two quick ones.
Number 1, should the drug come to market, how much overlap do you think or how much use of a synergy would you have with your Kite sales force? And the second question is to compete in this space and be aggressive and broad compared to other players in the IO space, sometimes if you spend a lot on multiple clinical trials, like how much more infrastructure do you think you'll need to be competitive in the IO space? And tangential to that, there's so many more opportunities to develop 47 versus maybe what a 47 as a standalone company could have done just from a cost perspective. So how are you thinking of balancing and prioritizing development of different programs? Thank you.
Thanks, Robin. Let me start with that. So I mean, first of all, I think it's terrific that we have relationships obviously out there already with certain hematologic customers through the KITE channel. And certainly, we can leverage that accordingly. Having said that, I think it's really important that we stay focused on cell therapy.
Cell therapy is an emerging pioneering program are significant and more significant than 47 is a standalone company. So and Murdad may have a comment here, but we're in the process of looking at the balance of our portfolio, how to prioritize assets and programs within our portfolio, including combination programs. And we won't be afraid to invest at all to make sure that we stay in the lead here, stay competitive not only with the lead indications in hematology, but also exploring solid tumors, but also stay in the lead in terms of the variety of combinations that one can think about, both within our portfolio at Gilead and then working with other partners accordingly. So this is in the sweet spot of I think what you have to do to be successful in oncology and we will not be afraid to invest as we see data and as we see signals in the data to move fast and be first with combinations with this molecule. Merdette, I mean, I think we're probably pretty aligned here, but from our experiences in the past.
Yes. No, I think that's right. I think one of the things that we are going to bring as a partner is the ability to do exactly what Dan said. I mean, I think the opportunity for us when we bring in these sorts of molecules is to put a lot of muscle behind executing around these in terms of breadth and scope of what we do to maximize the value of a molecule. In a sense, the way I would think about it is that actually because we are building a portfolio and because we have we're building in this area, we're going to put a lot of attention, a lot of effort behind these to make sure that we can get the best label and continue to maximize each molecule that we bring into our portfolio.
Great. Thank you.
Thank you. Our next question comes from Jim Birchenough with Wells Fargo. Your line is open.
Yes. Hi, guys. Congratulations on the deal and thanks So a few questions. I guess first, at a high level, Dan, could you just talk about how the 47 acquisition addresses your strategic imperative? And there's a comment on bolt on science and I just was hoping you could comment on bolt on science versus bolt on revenues and how you think about both to address future risks through the decade.
The second question is just on the maintenance dose of 30 milligrams per kilogram seems like a lot of protein, particularly if you're successful in a broad group of patients. So could you just comment on your ability to scale up manufacturing to meet that level of production? And then just finally related to Phil's question, when we think about accelerated approval and you think about azacitidine CR rates alone, should we think of that as kind of the lower bound of the confidence interval you need to be comfortably above? Thanks.
Sure. Thanks, Jim. I'll start out with maybe your first two questions. Yes, so I'll just repeat it. I think this is a perfect example of the strategy and action that we just rolled out.
So it's and a couple of things about that. I mean, the first one is that we're staying true to our in house knowledge in terms of evaluating external opportunities. I think when you get out over your skis and you get out into areas that you don't have internal expertise at and you start to deals like this, I think you run the risk of not doing the right deal. So I think our ability to understand immunomodulation, specifically related to immuno oncology and then the depth of experience we have, for instance, with KITE and hematology allowed us to take a critical look at this science, as you say, on the bolt on science side and determine that we think this has great promise. And so we'll keep doing that.
And as said, we'll focus on immuno oncology versus the broader field of oncology. So I think this is strategy in action basically and it's the strategy has actually really helped us to focus our internal resources on what to go after and not to go 7 and to be at the table right away when 47 was considering alternatives for their business. And that matters, as we know. So we'll continue to pursue and put those same behaviors in place for other assets as we look externally. So that I don't know exactly what you meant by bolt on science and bolt on revenues, but we're going to be science driven and unmet medical need driven and the revenues will follow, I would say.
On the scale up manufacturing, yes, we are more than capable. I mean, we do have a good expertise in house within Gilead on antibodies, on CNC development of antibodies and also pilot and scale up facilities to be able to manufacture decent qualities of antibodies for clinical trials and then working with partnership with our CMO network out there to ramp up for launch quantities. But that was a key decision that 47 is facing and I think we can use our network within Gilead to support them as we consider the scale up of this compound. With that, do you have anything else to add on that? And then go to number 3, I guess.
Yes. No, the only other thing I would add is on that is, as was mentioned earlier, if we go to every 2 week dosing, obviously, that has an impact on the amount of drug supply we would need as well. So those are a lot of moving parts right now, including optimizing expression and all those sorts of things that I think will get there. But I think to echo Dan, I don't think we're not concerned about getting that scaled up and available. So and then in terms of aacitidine alone in terms of the response rate, I think is what you asked, is sort of whether that should be the lower bounds of the expectations.
Yes, in my mind, I think we need to do again, the data you've seen so far, and I think what we think we need to do is that we should be substantially better in terms of both overall azacitidine alone. And I think that would be what helps form the basis of an accelerated review, assuming the data continue to play out the way we hope it will.
Thank you. Our last question comes from Evan Seigerman with Credit Suisse. Your line is open.
Hi, everyone. Thank you for squeezing me in. Just want to understand from a higher level why you opted for this asset versus something that would have been more quickly accretive to earnings? And then when you say immuno oncology versus broader oncology, can you provide some specificity as to how you're thinking about this? I'm assuming that you're not looking at TKIs, but any other color as to what type of assets you're looking for in, say, the next acquisition?
Thank you very much.
Yes. Thanks, Evan. Why opt for this asset? I think for all the reasons we mentioned, at the end of the day, this again fits into our criteria, which is high science, 1st in class, but also clinical stage asset. And we know in oncology, I mean, clinical stage assets with this type of data can move very fast towards contributing to our growth story at Gilead.
So we'll continue to look at clinical stage assets. Some may be near, some may be further away. Actually, I think this is kind of right in the sweet spot. But it will be science driven. So it will be driven on the distinctiveness of the molecule, the ability for it to be differentiated best in class and 1st in class, and that's our number one criteria.
And then after that stage of clinical program certainly affects where we may look and where we may put our efforts. And on the second piece on the immuno oncology focus for our oncology strategy, yes, I think we've been specific about the fact that there's lots of places to go in oncology. And we could have pursued a very broad strategy where we looked at rare tumor types that were more targeted outside of the immunocascades.
And there's
a lot of people doing that, and we're glad people are doing that because that's good news for patients. And we think that we need a focus that allows us to leverage our immunomodulation experience and to frankly just make choices about what we go after and what we don't go after. So that's a conscious choice we made to put resources to use in the best way and to leverage our internal experience mostly from KITE, which is I think the kind of the poster child, if you like, of personalized healthcare in immuno oncology and NF1 kind of solution for each patient to the internal portfolio have at Gilead pursuing a couple of different novel mechanisms in immuno oncology with small molecules to some of the antibody work we have with companies like Agenus and others. So this we're building an oncology portfolio now with as I said from prior to the 47 announcement, we had about 15 clinical stage programs in that sweet spot and in that area of immuno oncology and this cranks that up to around 20. So we like this focus.
We think it makes sense. We think it's the best place for expertise. There's huge unmet medical needs here and still a lot of potential for immuno oncology to deliver long lasting durable responses for patients, including getting towards curative responses in patients. Hope that helps.
Yes, it does. Thanks so much, Dan. Appreciate it.
Thanks. You got it.
Thank you. This concludes the question and answer session. I would now like to turn the call back over to Douglas Maffei for closing remarks.
Thank you, Shannon, and thank you all for joining us today. We appreciate your continued interest in Gilead, and the team here look forward to providing you with updates on our future progress.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.