Good day and thank you for standing by. Welcome to the Q1 2021 Sencore Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Mr.
Charles Lyles, Head of Corporate Communications and Investor Relations. Sir, please go ahead.
Thank you, and good afternoon. Earlier today, we issued a press release which outlines the topics we plan to discuss today. The press release is available at www.zencor.com. Today on our call, Basil Dahiyat, President and Chief Executive Officer, will provide a corporate overview and will review recent partnership news. Alan Yang, Chief Medical Officer, will review clinical updates and John Cush, Chief Financial Officer, will review financial results.
And then we'll open up the call for your questions. Before we begin, I would like to remind you that during the course of this conference call, Xencor management may make forward looking statements, including statements regarding the company's future financial and operating results, future market conditions, the plans and objectives of management, future operations, the company's partnering efforts, capital requirements, future product offerings, research and development programs and the impacts of the COVID-nineteen pandemic on these topics. These forward looking statements are not historical facts, but rather are based on our current expectations and beliefs and are based on information currently available to us. The outcome of the events described in these forward looking statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated by these forward looking statements, including, but not limited to, those factors contained in the Risk Factors section of our most recently filed Annual Report on Form 10 ks and quarterly report on Form 10 Q. With that, let me pass the call over to Basil.
Thanks, Charles, and good afternoon, everyone. Encore's approach to creating antibody and cytokine therapeutics is based on our Xpap protein engineering platform. It's built on our extensive protein engineering know how combined with our suite of XmAb Fc domains, which we use to build novel molecular structures, improve natural protein and antibody functions and create new mechanisms of therapeutic action. The plug and play portability of our XmAb Fc domains and the speed of our protein engineering capabilities enable us to rapidly explore different targets and biologies, so we can select the most promising programs to take forward. We've been focusing our work on the expansion and use of our XmAb bispecific platform, the newest XmAb component to create antibodies that bind 2 or more different antigens simultaneously and also to engineer cytokines with structures optimized for particular therapeutic uses.
Now our many partnerships really highlight its plug and play nature. Currently, we have 15 ongoing partnerships for XmAb technology, which have now resulted in 2 marketed products, Alexion's ULTOMIRIS for rare blood disorders and MorphoSys' Monjuvy is the first second line treatment for patients with diffuse large B cell lymphoma. Just this past March, our partner Vir Biotechnology with its partner GSK submitted an emergency use authorization application to the FDA for Vir-seven thousand eight hundred and thirty one, their anti SARS CoV-two antibody that incorporates our Xtend Fc technology. Based on an interim analysis of the Phase 3 COMET ICE trial, which demonstrated an 85% reduction in hospitalization or death in high risk adult outpatients with COVID-nineteen receiving VER-seven thousand eight hundred and thirty one as monotherapy compared to placebo, the primary endpoint of the trial by the way. Now, Xtend was integrated into VER-seven thousand eight hundred and 7,831 for the purpose of reducing the dose administered and potentially enhancing its lung tissue bioavailability.
Now, this partnership exemplifies our commitment to enabling the broad use of XmAb Fc technologies outside our core focus of oncology and autoimmune diseases and demonstrates XmAb's vast applicability to underserved areas like serious infectious disease. Now if authorized, VER-seven thousand eight hundred and thirty one would then become the 3rd antibody with our XmAb technology to reach the market. Now switching back to internal programs, we're currently running 7 Phase 1 studies evaluating XmAb, bispecific antibodies and cytokines. This way we're taking multiple simultaneous shots on Golden Clinic and the proof of concept data we generate will guide which programs we independently advance, which we partner and which we will terminate. I'll let Alan Yang, our Chief Medical Officer review updates for our clinical portfolio.
Alan?
Thanks, Basil. Since our last update about 2 months ago, we dosed the first subject in the Phase 1 study of XmAb5 our wholly owned IL-two Fc fusion engineered to selectively activate regulatory T cells or Tregs for the treatment of autoimmune diseases. The goal of an IL-two therapy for autoimmune disease is to provide sustained low intensity activation of Tregs while avoiding the pro inflammatory systemic activation of effector T cells. An IL-two therapy that is selected for Tregs with an expanded therapeutic window compared to historic IL-two approaches would have broad potential across many different autoimmune diseases and preclinical studies indicate this may be the case for our program. It is engineered with reduced potency to improve tolerability, improve duration of action for this normally toxic cytokine.
And using our XmAb heterodimeric Fc domain and Xtend technology enhances its half life. XmAb-five sixty four is now our 2nd cytokine in the clinic, joining XmAb-three zero six, our engineered IL-fifteen for oncology that is partnered with Genentech. This single ascending dose study will characterize the safety, tolerability and pharmacokinetics of XmAb564 in healthy volunteers and will include an analysis of key immunomodulatory biomarkers. For the remainder of the year and into early 2022, we are planning to initiate several additional clinical studies to advance our wholly owned bispecific antibody drug candidates. First, for XmAb717, our PD-one CTLA-four dual checkpoint bispecific antibody in mid-twenty 21, we plan to initiate a Phase 2 study for patients with certain molecular subtypes of castration resistant prostate cancer as monotherapy or in combination depending on the subtype as these patients represent a high unmet medical need.
Previously, this was planned as a Phase Ib study, but we have transitioned it to a Phase II study. We continue to expect that we will present more data from the ongoing Phase 1 studies expansion cohorts later this year as the data mature. And to this study, we have added an additional cohort of patients with relapsed or refractory melanoma with a more tightly defined disease population. For tilduzumab, our CD3 bispecific antibody that targets SSTR2, we plan to initiate clinical study in patients with Merkel cell carcinoma and small cell lung cancer, SSTR2 expressing tumor types known to be responsive to immunotherapy in mid-twenty 21. Due to a COVID-nineteen related staffing issue at the study site, study startup activities were delayed by a few months.
Shifting to Plimodimab, under our strategic clinical collaboration with MorphoSys, we are investigating the chemotherapy free triple combination of Plimodimab, or CD20xCD3 bispecific antibody with tafasitamab and lenalidomide in patients with certain lymphomas. We plan to initiate the first of these studies in patients with relapsed or refractory diffuse large B cell lymphoma, an aggressive type of non Hodgkin's lymphoma in late 2021 or early 2022, once we have finalized the recommended dose in our ongoing Phase 1 study and complete operational preparation for the multinational trial. We plan to present updated data from the Phase 1 study later this year. Briefly, for XmAb698, a CD38xCD3 bispecific antibody, which was formerly known as Amgen's AMG424, we plan to support investigator initiated studies and a new study is currently being planned to start later in 2021. Last, we anticipate filing an IND for XmAb819, our ENPP3xCD3 bispecific for renal cell cancer later this year and initiating a Phase 1 study in early 2022.
XmAb819 uses our multivalent 2x1 bispecific NPP3 density expression on tumor cells compared to the lower density on normal cells. The binding selectivity of the XmAb2 plus 1 format extends the range of targets amenable to CD3 bi For example, our partner Amgen's AMG 509 program targeting C1 in prostate cancer uses this format. In summary, we continue to advance our pipeline by graduating molecules into Phase 2 and are bringing new novel agents into the clinic. Basil?
Thanks, Alan. Now we're always looking to grow this pipeline with new programs as we have with our IL-two Treg and ENPP3 programs that Alan just mentioned. Along this front, last month at the AACR Annual Meeting, we presented data from 4 preclinical stage programs, including our 3rd cytokine, an IL-twelve Fc fusion protein for oncology, 2 additional XmAb2 +1 CD3 bispecific antibodies. These ones target CLOUDIN6 and GPC3 as well as our PD L1xCD28 bispecific program. All four posters are available on our website.
Now I'd like to take a moment to review this targeted CD28 platform, which is a new class of T cell engager designed to complement other mechanisms of T cell activation, such as checkpoint inhibition or CD3 engagement. CD28 is a key immune co stimulatory receptor on T cells that has been difficult in the past to safely and effectively engage therapeutically. By targeting a CD28 binding domain to a tumor by using a bispecific antibody, we have to boost the activity of T cells in a tumor specific way to enhance T cell directed therapies. Our most advanced wholly owned lead CD28 candidate is a B7 H3xCD28 bispecific antibody for potentially broad solid tumor use, including in prostate cancer, where B7 H3 is highly expressed. This molecule is advancing through clinical development now.
Of course, the focus of our new collaboration with Janssen that we announced a few months ago is to discover a CD28 bispecific antibody against a prostate tumor target. Core part of our business is to complement our internal development portfolio with partners like Janssen and many other leading companies in the industry. These partnerships generate payments from the licensing of XmAb Technologies, the clinical advancement of XmAb candidates as well as royalties from sales approved products. There were no COVID-nineteen impacts to partnering revenue that we were aware of during the Q1, but we'll continue to monitor potential impacts of course. Last quarter, we disclosed that we had entered into a license agreement with a privately held company, which remained undisclosed at that time.
Now we can disclose that this company is Zenith Biopharma, a new cross border company developing immune based therapies for patients in China and around the world. We granted them worldwide rights to develop 3 preclinical programs incorporating XmAb Fc domains for development in autoimmune diseases. We received a 15% equity interest in the company and are eligible for royalties. We also entered a new academic collaboration last quarter with UCLA to extend the use of our XmAb technology, pairing novel targets proposed by scientists at UCLA and Xencor's modular suite of XmAb technology platforms. What we've done is establish a framework with predefined terms to enter sponsored research agreements and potential license agreements to streamline and expedite any potential drug candidates that are selected for further development.
The UCLA agreement is our 3rd collaboration focusing on novel target biology to create a new generation of XmAb bispecific antibodies. Joining those we've entered with a trachea and MD Anderson. Now with that, I'll hand the call over to John Cush, our Chief Financial Officer, who will review key highlights from our Q1 financials. John?
Thank you, Bassil. Xyngor's broad protein engineering platform and resulting partnerships and collaborations continue to generate revenue and provide value to support our growing portfolio of clinical and research stage bispecific antibody and cytokine drug programs. Cash, cash equivalents and marketable investment securities totaled $577,100,000 as of March 31, 2021 compared to $604,000,000 on December 31, 2020. The decrease reflects royalties and milestone payments received related to licensing agreements net of cash used to fund operating activities for the Q1. Based on current operating plans, we expect to have cash from research and development programs and operations into 2024 and we currently estimate that we will end 2021 with between $425,000,000 $475,000,000 in cash and cash equivalents.
Total revenues for the Q1 were $34,000,000 compared to $32,400,000 for the same period in 2020. Revenues in the Q1 include revenue related to our Janssen collaboration, milestone revenue recognized from MorphoSys and the royalty revenue from Alexion and MorphoSys. Compared to revenues from the same period in 2020, which were primarily milestone revenue from MorphoSys, royalty revenue from Lexion and licensing revenue from our Aimmune and Gilead collaborations. Research and development expenditures for the Q1 were $41,400,000 compared to $33,900,000 for the same period in 2020. The increase is primarily due to increased spending on our XmAb306, XmAb 564 and XmAb 819 programs.
General and administrative expenses for the Q1 were $8,200,000 compared to $7,200,000 in the same period of 2020. The increase primarily being related to an increase in staffing. Other income for the Q1 of 2021 was $13,200,000 and included a gain of $12,900,000 in equity received in connection with the licensing transaction compared to $700,000 for the same period in 2020, which was primarily net interest income earned for the period. The net loss for the Q1 was $2,500,000 or 0 point 0 $4 on a fully diluted per share basis compared to a net loss of 8,100,000 dollars or $0.14 on a fully diluted per share basis for the same period in 2020. The lower net loss reported for the Q1 of 2021 compared to net loss for the same period in 2020 is primarily due to other income recognized from equity received in the Q1 of 'twenty one in excess of increased spending on research and development expenses for the period.
Non cash share based compensation expense for the first quarter was $8,300,000 compared to $6,500,000 for the same period in 2020. And total shares outstanding were 58,200,000 as of March 31, 2021 compared to 57,000,000 as of March 31, 2020. With that, we would now like to open up the call for questions. Operator?
Thank you, sir. Of Piper Sandler. Sir, please ask your question.
Great. Thank
you very much and thanks so much guys. So much exciting stuff going on. I'm wondering whether or not we should anticipate an update from the Roche program for IL-fifteen this year. And also just going back to PD-one, CTLA-four-seven seventeen, we'll be getting prostate cancer data, but what other cohorts could we expect from that this year? Thanks so much guys.
Hey, thanks Ted. So regarding our XmAb306 IL-fifteen program, that's the oncology collaboration with Genentech. We are discussing a publication plan with Genentech. We don't have specific guidance for timing of data this year. I will point out that the dose escalation in a broad range of solid tumor patients continues monotherapy, which was started last March, as well as the we're continuing the dose escalation as a combination with atezolizumab, their PD L1 molecule, which started in Q4.
So those are ongoing. We'll come up with guidance once we have agreement with Genentech on the publication plan, as well as of course keeping people abreast of any additional study starts that happen over the next year. With regard to XmAb717, our PD-one CTLA-four molecule, yes, there are going to be additional cohorts that we disclose data for from the expansion cohorts of the Phase 1 study. So in addition to a much more mature data set from our prostate cancer cohort, we'll have a more mature data set, it was only partially enrolled for our renal cell carcinoma cohort as well as more mature data from our basket cohort of multiple tumors that are not in PD-one approved indications. So we would expect all of that in the second half of this year.
Awesome. Thank you so much. I'm excited to see IL-two go into the clinic too.
Yes, we are too.
And speakers, your next question from Mara Goldstein of Mizuho Securities. Ma'am, your line is open.
Great. Can you hear me?
Yes.
Awesome. Thank you. So I wanted to ask 2 things. The first is around the strategy of converting that Phase 1b in prostate cancer to Phase 2 and what you will achieve by that? And then the second, is around the cytokine strategy.
I mean, clearly, we're seeing the beginnings of a lot of early work with novel engineered cytokines and the like. And so I'm just curious as to sort of the what you're thinking from a competitive perspective and a competitive advantage using the XmAb technology as you are versus, let's say, engineered cytokines cytokines and other fusion proteins and the like?
Yes. So, I guess on the first question, the shift of the XmAb717 PD-one CTLA study in prostate cancer that multi that basket study, why shift from a Phase 1b to Phase 2? My understanding and Alan you should pipe in here was that it was simply a better reflection of what the study actually was doing given we have the go forward dose we selected for that study, merely that. Anything to add, Alan?
Yes. No, it is a little bit of nomenclature. Remember, a Phase Ib could be looking at combination. So we have already sort of disclosed that this will explore 717 with sort of key combinations of either chemotherapy or targeted agents. And whether you call that a Phase or a Phase 2 with a safety run, and I think a Phase 2 is a better accurate description.
We sort of know our dose. We know the combinations we want to try. And we're really looking for a signal in certain sort of molecular subgroups or clinical subgroups of prostate cancer. So it's more effective of Phase 2 and planning to go to eventual Phase 3.
Yes. Now on your second question, Mara, the cytokine, the strategy we're taking for this really rapidly evolving and growing field of engineered cytokines, I'll maybe ask John Desirlais, who's actually on the call here to answer questions to chime in about how our design strategy has some commonalities for how we're looking at all the cytokines and yet how we're tweaking it for the individual ones. We agree it's a really exciting area, which is why we're committing a lot of additional efforts and resources there. John, you want to go ahead?
Yes. Sure, Basil. Yes, Maura, when we first tackled IL-fifteen, we went in, we fused IL-fifteen to an FC to make a long acting cytokine and we made a critical key discovery that natural cytokines are limited in their ability to stay around very long in circulation. And so the solution we came up with was to decrease the potency fairly dramatically. And in doing so, we found out that we actually make a much better drug.
It lasts a lot longer in circulation and because it can last longer, even though it's lower potency, it can actually mediate its pharmacology for a longer period of time. Also, the fringe benefit of that reduced coat sequence was much better tolerability and much better control over toxicities as you dose escalate. Now we turned around and applied that same concept to the IL-two program, our Treg expander found exactly the same result that we got dramatic improvements in pharmacokinetics and pharmacology when we reduced the potency. So far that seems to be playing out really nicely with the IL-twelve program as well as we detailed on our AACR cluster. So that's the unifying theme is which seems to be pretty unique in the community is going with longer acting lower potency molecules.
Thank you. I appreciate that.
And speakers, your next question from Peter Lawson of Barclays. Sir, your line is open.
Great. Thanks for taking the question. Thanks for the updates. Just on IL-two, when do we see data around that and kind of how do you think about picking particular tumors and combination partners there?
Well, our IL-two is targeting activation of regulatory T cells. So that's our program focused in autoimmune disease. Our IL-fifteen is the one that is the collaboration with Genentech is our play with the cytokine for activating T cells along that same pathway. So do you want to talk about the IL-fifteen or do you want to talk about the 564 program or IL-two program?
I'm just curious if you're thinking of moving that IL-two as well into oncology or
No, no. We don't have any intention to do that. Its biology is really tuned as John said. Well, I guess John, it's tuned for potency. But in addition for that IL-two molecule, we actually took the direction like some of our some other companies that are looking at the same approach of increasing the relative binding affinity to the inhibitory well to the receptor that's more prevalent expressed on regulatory T cells, the IL-two alpha receptor.
So we really feel that's much more appropriate for autoimmune indications. We haven't yet guided specifically on when we expect to have data from the single ascending dose. Essentially, it's a biomarker and safety study. The initial work in the clinic with that molecule could be later this year, but we'll guide specifically as we get a little further into this study. We just opened the study about a week ago.
Great. Thank you. And then the B7 and H3 contract, I think you've talked about that before. I'm just curious where that is and where you're thinking of positioning that construct?
Yes, I'll touch on the timeline and then if John wants to jump in on how we're positioning it. So that molecule we hope to have in the clinic in 2022. It's in active preclinical development now with all the requisite manufacturing scale up activities just getting started. John?
Yes. In terms of thinking about applying that, the reason we selected B7 H3 as a target is it's very broadly very brightly expressed across a range of solid tumors. And we wanted a molecule that we could use to target tumors, get tumor specific CD28 co stimulation, which is your SIGNAL 2. And then you can use that to build on whatever signal 1 is being provided, right? And that signal 1 could be provided either by just natural T cell reactivity against neoantigens, in which case you'd probably want to be exploring that our B7 H3 CD28 in a PD-one combination study or Siga-one could come from any one of our T cell engagers, our classic CD3 bispecifics in our solid tumor pipeline, the first of which will be an ENPP3xCD3.
And I guess beyond that, I would also say B73 is a particularly interesting target in prostate cancer. It's very bright there. And we, of course, would want to explore that in prostate cancer as well.
Great. Thanks so much. Thanks for taking the questions.
Thanks, Peter.
And speakers, your next question from Alicia Young of Cantor. Ma'am, your line is open.
Hey, guys. Thanks for taking the call. This is Lee on for Leticia. We just have a follow-up on IL-two program. Since you just recently started the trial, can you just talk a little bit about how your molecule is differentiated from others in the space and what advantages that you expect to see in the clinical setting?
Right. So the design follows the rule of our cytokine engineering that John sort of laid out, which was, it's taking the natural IL-two molecule and making mutations in it to dramatically dial down its potency. I think we're north of a 100 fold less potent than wild type IL-two fused to an Fc domain. Now the things that make this particularly well suited for autoimmune diseases, our protein engineers biased the binding to actually have a significantly higher ratio of binding to the CD25 or IL-two or IL-two alpha receptor than to the IL-two beta gamma receptors. That receptor is heavily expressed on regulatory T cells to bias it towards Treg.
So how do our designs differ from the sort of what's the positioning? We hope that our dramatically lowered potency as well as our Fc domain, which contains our Xtend technology gives us an enhanced therapeutic window, we won't know until we see and that we can get excellent Treg amplification. John, am I missing anything on and maybe John, if you want to comment on the monomeric IL-two nature and how that's distinctive in the industry?
Yes. No, that's a good point. So we designed ours using our Fc heterodimers, which enables this, we designed ours to only have a single IL-two for the Fc domain, whereas competitors like Amgen or other efforts have a bivalent IL-two. We think having the monovalent IL-two actually helps reduce internalization through receptor binding. That's sort of a kind of a classic paradigm in terms of biologics and internalization.
And so bottom line is, again, we applied our potency reduction, monomeric IL-two. We would hope that we have highly competitive or even best in class pharmacokinetics and pharmacodynamics.
Okay, great. Thanks. And I have another question on your IL-twelve program. I know it's preclinical, but just curious how you're thinking about subjects designing a molecule that can potentially address the narrow therapeutic window here? Thanks.
I mean, John, you want to take that, I guess?
Yes, sure. Yes, I'll take that. Yes, again, we found and you can see a pretty nice story about this on our AACR poster. We found again that the potency reduction gave us much better control. So when we put the IL-two I'm sorry, the IL-twelve potency reduced version into monkeys and compared it to a wild type IL-twelve Fc fusion, we found that as we dose escalated in non human primates that we saw much more gradual onset of a key pharmacodynamic marker, which is IP10, which is downstream of viniferin gamma, right?
That's what the famously does. And so as we dose escalated our potency reduced version, it was a much smoother ramp up on that pharmacodynamic marker. And by comparison to the wildtype IL12 Fc. And what that tells me is we're going to have a much easier ride when we dose escalate because we've got much better control over what's actually going to go on in the humans when we use this reduced potency molecule. So
that's what
we have so far. That's what the preclinical data suggests, but obviously, we're going to have to see what happens in the clinic.
Okay, great. Thank you.
And speakers, our next question from Etzer Darauth of Guggenheim. Sir, your line is open.
Great. Thanks for the question. So really for the XmAb564, I guess, if you sort of see the appropriate therapeutic window, do you have any thoughts on how sort of maybe the low hanging fruit indications, if you will, or maybe sort of maybe interesting indications that you could pursue initially, obviously assuming success? And then I have a second question.
Yes. We're not guiding on specific indications we're selecting them as soon as we come out of dose escalation. Of course, there's a multiple ascending dose escalation component to the study that will start after the SAD. We think there's a lot of opportunity for these novel mechanisms of action like Treg inhibition in some of the smaller autoimmune indications. And so we're certainly looking there, but I think when you look at what are the competitive landscape in some of the larger Now, Now did you have a follow-up question?
Got it. Yes, just a second question, I guess, on sort of the initiation of the tlomodumab tafasitamab study. And I guess, based on the entry remarks, is the data from the ongoing Phase 1, if you will, sort of the main hurdles to sort of getting that started in terms of sort of the timeline variability that you described?
I think it's pretty coincident with the operational pieces as well. And I think that we hope they'll all come together. We are dosing a Q2 week now with a Q1 a Q weekly run-in period much like we've seen from other programs. So squaring that away is ongoing and we hope to have that data present late this year like we've guided and hopefully start off the Phase 2.
Great. Thank you and congrats on all the progress.
Thank you.
And speakers, our next question from Tom Schroeder of BTIG. Sir, your line is open.
Thank you. Good afternoon. Thanks for the update and taking the questions. Just for 564, what is the theoretical safety concern from too many Tregs?
I don't know if it's from too many Tregs. I think it's a combination of being just being non selective and having lots of T cells period amplified is the problem and that can cause your usual capillary leak syndrome, cytokine syndrome, the toxicities that are seen with IL-two therapy with proleukin. So you just need to control that from coming on too strong, whether it's the Tregs you're amplifying or T effectors.
So the classic immune effects. Go ahead. Another way of saying it is we optimize selectivity of our IL-two for Treg, but there's no such thing as perfect selectivity. So at some point, if you dose high enough, you're going to start tickling effector cells and other cell populations.
And to just dig
in a little bit to the last question, I mean, this molecule could in fact play many, many places. Do you think your likely first trial would be something like psoriasis, where you get a clinical readout very quickly and then you'd be confident to try many other things? Or do you think a good biomarker signal would be enough to go into more challenging applications?
Yes, it's a great question because that's something that with many programs we mull over and I think we're on the industry mull over. Do you want to get some kind of disease modification signal even if it's an indication that is not necessarily a great development path because of competitive density or you trust the biomarkers. I think that the thesis around Treg's role in modifying disease activity is one risk that most companies seem to be willing to take as long as you can get the good biomarker movement. I mean, you know what you're trying to do, how that plays into disease. I wonder if even if you proved it in something like psoriasis, which is probably a tough hill to climb from a development and a competitive standpoint, even if you showed disease modifying activity there, I don't know how well it would translate.
So I don't know if Xencor really favors that approach as opposed to like many of our competitors looking at the Treg counts and the other T cells as biomarker that's really kind of definitive for a go signal.
Okay, great. Thank you. Very useful answer.
And speakers, our next question from C. K. Hao of Berenberg. Please ask your question.
Hi, good afternoon. Thanks for taking my questions. I have a few. The first one on 717, you said that you're going to move to the combination trial in prostate cancer. What kind of combinations are you thinking to potentially move to 3 different set groups there?
That's the first one.
So we're not saying explicitly, I think and Alan jump in if I'm missing anything, but depending on the subtype and what's known about how they respond or don't respond to treatment, they will include both chemo combinations as well as some targeted therapies that make sense for certain molecular subtypes. I don't know if we can say more than that, Alan, right?
Yes. I think it's fairly obvious. There are some targeted agents that have been approved for prostate cancer like PARP inhibitors. And then the chemotherapy is still used in certain aggressive types as well. So those subtypes you would have to combo with the checkpoint inhibitor.
And so obviously we're going to explore those.
Got it. Okay. And then for the just curious about CD28 biology here. What's the I guess broadly, what's the difference between CD28 bispecific versus CD3 bispecific from, I guess, safety and efficacy standpoint? Is it more
That's a long question, John. Why don't you try I mean,
I guess
you could briefly go ahead.
Yes, that's a great question. So the CD3 is kind of a bigger hammer, right? So CD3 is signal 1 on the T cells. And it's not specific to any particular T cell population, right? The point of a CD3 is to grab any T cell in the vicinity and mobilize it against the tumor.
So of course, that's going to be a little bit more challenging in terms of safety profile, either in terms of CRS, but also in terms of just on target off tumor toxicity. With the CD28, it's a pretty intriguing concept because it's providing the signal to which can amplify a signal 1 and then it can build off of a signal 1 that's coming elsewhere, right? And like I was saying with one of the earlier responses, the signal 1 could come from an endogenous T cell reacting with a tumor cell. And now you're adding in that signal 2 with CD28 and amplifying that natural endogenous T cell anti tumor response or SIGNAL-one could come from a CD3 bispecific and you could combine the 2. And so we're obviously contemplating both approaches.
Got it. Thank you. Final quick one on 698CD3, CD38 molecule. I guess, where do you see this molecule go in the future development?
So right now, we're following the lead of some investigators who are enthusiastic about a CD38, CD3. We'll note that Amgen decided to jump out of development and really this was a molecule we had enabled with our technology, but hadn't actually made for them. They just took our various building blocks and put them together for CD3, CD38 and FCmin. And in myeloma, they felt that the AE profile wasn't consistent with a to go forward with it. We'll say that without disclosing until we've got the trial up and running, there are other hematologic malignancies that express CD38 where the tolerability profile might seem quite reasonable in that context.
So more to come on that.
Great. Thanks very much. Congrats on the progress.
And speakers, our last question from Arlinda Lee of Canaccord Genuity. Ma'am, your line is open.
Hi, everybody. This is Ben calling in for Linda. Thanks for taking my questions. A lot of them have been answered. I just wanted to ask a few on 717 and plamotamab.
A few PD-one CTLA-four programs have data that have been presented at this point. And I'm just wondering regarding 717, how is the safety looking versus nivo versus an ipi combination regimens? And what do you guys ultimately hope to show in the data?
I guess I'll ask the first answer
the first one. What do you hope to show in the data? We have to show that in we can find an indication or we can make a difference for patients, whether that's in a relapsed refractory setting, like some of the areas we're looking at or even more exciting, we think is in areas where there aren't checkpoints approved, where the combination of MOAs and the tolerability profile, the combination of CTLA-four and PD-one can move the needle that hasn't been moved before. And I think prostate cancer is a great potential example there. Regarding the safety profile we've observed so far, I'll let Alan take that question.
Yes, Basil, thanks. So it's fair to say that the nivoipi combination is probably more effective than PD-one blockade alone, but clearly you get a lot of toxicity, only about a third of patients remain on study past a few courses. So the most common toxicity is colitis. This is the most common toxicity that leads to interruption or discontinuation. And so we haven't seen that high frequency of colitis.
We believe that the indications, as Basil alluded to, is where PD-one plus CTLA-four has been shown to be synergistic. And perhaps you haven't seen that much improvement activity. Prostate cancer is a classic example of that.
Okay, great. That's very helpful. Switching gears to plamatumib, and I understand that MorphoSys might be driving a little bit of a fuss here. It's a competitive space and I'm just wondering how do you think plamutamab in a competitive positioning? And then maybe can you comment on what you think the development strategy will be?
Do you expect maybe data in 2022 at some point?
Yes, I'll take that one. So the positioning for polynomial, you're right, it's a very competitive area, CD20, CD3s in an already competitive indication in lymphoma. And we think that the approach we're taking is recognizing that that competition is going to be hard and that we need to go with something that is really combining the 2 most active regimens we can that has the best scientific rationale we can think of and to see if we can go for the best approach, sorry, the best combination approach that and this is a key point is chemotherapy free, a direction the field desperately wants to move in lymphoma just like has happened in leukemia based on the success, CLL with ibrutinib and venetoclax used with antibodies. So the plano, TAVALEN combination is tafacitamablenolinamide is the most active and a very durable combination therapy in second line and later aggressive lymphoma. It's a well tolerated regimen and it uses orthogonal mechanisms of action to plammo to a CD20, CD3.
It's effector cells, innate effector cells driven by the FC technology that we put into tafasitamab and CD19 binding, so a different target also than a CD20, CD3. So it really seems like a really totally perpendicular mechanisms of action that hopefully can complement each other. And so we wanted to combine with the most active agent that was really tolerable. So that's our strategy. It's going for a chemotherapy free regimen that could be super active.
And that's how we hope to distinguish ourselves. Chemotherapy
type
of toxicities, which can often include long term chemotherapy type of toxicities, which can often include long term toxicities and secondary malignancy risks and there's a whole host of others.
Okay. That's what we're going to do now.
Go ahead, Alan. Sorry, before you go on to another one, Ben.
Go ahead. Maybe I can add some color. So the strategies have been sort of declared by our competitors, right? So there's 2 chemo regimens that are often used for the second line. It's either, Gemox or bendamustine rituxan.
And the strategies that our competitors are using are either to compete against that directly as single agent or add on to that regimen like GemOx. As Basil alluded to, our strategy is sort of a little bit different. Tapasitumab, at least in the transplant ineligible populations, have been already approved for that second line indication, right? And so now we're adding our CD20 to their CD19. And then, of course, lenalidomide potentiates the CD19.
It could potentially potentiate the CD20 as well. And so that is the sort of differentiating approach. So we think our approach is vastly different from the others.
Okay, great.
Sorry, back to you, Ben.
No worries. I'm sorry to interrupt you. So data readout, do you think might be in 2022 or maybe later?
We're not guiding on that yet. We want to get the trial started, then we'll give specifics.
Okay. Thanks again for taking my questions. Appreciate it.
Thank you. All right. Well, I guess if that's the last question, we'd like to thank everybody very much for joining us today. Hope you have a wonderful rest of the afternoon and we look forward to catching up again and getting further updates on our progress throughout the year. Thank you.
This concludes today's conference call. Thank you all for participating. You may now disconnect.