Compugen Ltd.
Q2 2017 Earnings Call Transcript

Published: 2 Aug 2017

[Operator:]

Ladies and gentlemen, thank you for standing by. Welcome to Compugen's Second Quarter 2017 Results Conference Call. At this time, all participants are in a listen- only mode. An audio webcast of this call is available in the Investor section of Compugen's Web site, www.cgen.com. As a reminder, today's call is being recorded. I would now like to introduce Elana Holzman, Compugen's Director of Investor Relations and Corporate Communications. Please go ahead.

[Elana Holzman:]

Thank you for joining us today. Before we begin, I would like to read the following regarding forward-looking statements. During the course of this conference call, the Company may make projections and other forward-looking statements regarding future events or future business outlook, anticipated progress on Compugen's pipeline program as well as commercialization efforts. We wish to caution you that such statements reflect only the company's current expectations and that actual events or results may differ materially. You are kindly referred to the risk factors and cautionary language contained in the documents that the company filed with the SEC, including the Company's most recent Annual Report on Form 20-F, filed February 16, 2017. The company undertakes no obligation to update any projections or forward-looking statements in the future. I will now turn the call over to Anat.

[Anat Cohen-Dayag:]

Thank you, Elana, and welcome to Compugen. I would also like to welcome all the participants on today's call. Joining me from Compugen today are John Hunter, our Vice President, Antibody R&D and Head of our San Francisco Guide; and Ari Krashin, our CFO and COO. Unfortunately, Martin Gerstel, our Chairman, who usually participates in this quarterly calls is currently on vacation, and therefore would not be joining us today. Before moving to a corporate update, I would like to say a few words about Paul Sekhri deployment as our new Chairman. As most of you are probably aware in a separate press release issued today, we announced that Paul will be replacing Martin Gerstel effective October 2. Martin has been with the company for two decades and has made invaluable contribution as we evolve from a discovery only company to having a promising cancer new therapy pipeline of first-in-class drug opportunity. As Martin stated in February, while Compugen is advancing toward first-in-man clinical trial and it's facing new opportunities and challenges it would be appropriate for Compugen to have the new Chair person on board to guide the next chapter of our corporate growth. Paul brings to Compugen over 30 years of extensive and diverse experience in life sciences industry, in drug development, business development and commercial strategy having been part of both the Pharma and biotech companies and with that experience in both of public and private companies. I'm thrilled that he has accepted our offer and I look forward to working with him along the rest of our board. I'm confident that Compugen will greatly benefit from his leadership and guidance. In addition, I wish to thank Martin for his invaluable contributions to Compugen's development for two decades and we all look forward for his continued support. In my prepared remarks today, I will provide an overview of our recent activities and progress made over the last quarter, I would discuss our collaboration with Bayer, followed by an update on the progress made within our project pipeline, specifically on COM701, the company's leading immuno-oncology checkpoint candidate targeting PVRIG. I will discuss the plan for IND filing, the clinical advisory meeting with key clinicians in the immuno-oncology field, our development path and the patents we were recently granted by the United States pathogen trademark. I will also update on our second clinical program COM902, our TIGIT inhibitor. Following my remarks, John will be sharing some data we presented at ASCO, The American Society for Clinical Oncology meeting. Please lock in to the webcast link on our website to see the slide. John will also present our clinical development strategy for COM701 which includes opportunities for monotherapy as well as dual treatment combination treatment options. Ari will conclude the company's prepared comments, the key aspects of our financial results that were published earlier today. Last week, we issued a press release updating the status of our activities with Bayer. Our agreement with Bayer involves the research development and commercialisation of Antibody based therapeutics against two-novel Compugen discovered immune checkpoints regulatory, CGEN-1501T and CGEN-15022. However, a recently completed joint assessment by Compugen and Bayer, a potential drug candidate against the CGEN-15022 target has suggested there is potential to serve as a key new checkpoint for the treatment of cancer immunotherapy maybe limited, it does not justify further investment. Therefore it has been determined that the current collaboration will focus solely on CGEN-1501T and all rights to CGEN-15022 will be returned to Compugen. As previously announced, Bayer continues to advance the CGEN-15001 program towards first-in-man clinical trial, to-date we have received $25 million in upfront and liaison payments from Bayer primarily due to the progress of CGEN-1501T and we see significant upside potential for this program with over $250 million in total milestone and royalties and product sales. The Bayer collaboration has been and still is highly productive and we look forward to continuing to work together with their excellent team. We're very proud with the success rate of our predicted discovery capabilities advancing one out of two of our novel immuno-oncology Bayer program from computer prediction to pre-clinical because studies and into IND drug development under this collaboration. We remain very confident in our discovery capabilities and intend to continue to enhance them to maintain a strong competency in the field of novel targeted mix. We did effective collaboration and our excellent relationship with Bayer the companies are discussing potential addition - additional collaborative projects in the area of immuno-oncology. On the business development front, we're encouraged by the various discussions and the valuation processes we're currently holding with potential industry partners with respect to our full program areas. To remind you, these are COM701, our anti-PVRIG drug candidate; COM902, our anti-TIGIT drug candidate; our Myeloid target for immuno-oncology and CGEN-15001, our Fc fusion protein drug candidate for autoimmune diseases. It is important to note that these type of industry partnerships detail a lengthy evaluation period particularly when it relates to completely novel targets such as ours. While we're confident that we can achieve multiple pipeline collaborations and believe that a new industry partnership may occur before the end of the year, the exact timing for completing any such collaborative arrangement cannot be precisely predicted and may take longer. Moving now to an update on our pipeline program, I will focus today on COM701 and COM902, as we previously announced our contract development manufacturing organisation face the contamination events were manufacturing the lot intended for our plan COM701 ELP toxicity study. This event resulted in our need to reschedule the filing of our IND which was originally planned for Q4 of this year. Today I'm pleased to announce that following investigation with CDMO production of this route for Clinical testing is currently in progress and GFD studies will be pursued with newly produced material. During this progress, we're now targeting the IND filing towards the end of Q1, 2018 with the expectation of initiating our Phase I clinical trial a few months later pending of course on clearance by the regulatory authority. In pilot to preparing for clinical trials we're also expecting potential biomarkers that can be used to enable the selection of patients likely to respond to our COM701 treatment. I would also like to relate to-date to some recent developments in the immune oncology landscape. Well PD-1 blockade has demonstrated the secrecy across the wide range of tumor and has quickly been established as the revolutionary treatment to cancer patient and the standard of care for cancer treatment, the outcome of most of the recent trials reinforce the fact that still the majority of patients do not respond to PD-1 blockade. It is also clear that the need for new important immune Checkpoint pathways such as PD-1 or other approaches to increase the response rate remains a key unmet need. Therefore, the focus of the industry is turn towards the search of new Checkpoint pathways and various combination therapies to increase patient response rate. But still also a third competition in the field, the initial clinical data from other target or Checkpoint is in most of the cases not very compelling. Also the large amount of ongoing clinical trials of drug commission's treatments with Checkpoints performed usually in an opportunistic session. Mostly did not demonstrated substantial increase response rate among patient, again highlighting the high remaining unmet need for new target in biological pathway? These presents Compugen with a unique opportunity to generate value by developing differentiated in the novel asset. For example the TIGIT genome access represents an alternative immune Checkpoint pathway with the potential to be key for multiple combinations. This is due to two main reasons. First, TIGIT is believe to be a key immune Checkpoint which is in clinical testing by several companies. The novel target we discovered PTIG is a second distinct Checkpoint in these assays. We believe and our experimental data to-date support as the blockade of these two Checkpoint offer the potential to fully maximize the executive of these two important related pathways in these access. Second, legend of PGNiG is expressed in both patients who are PDL-1 partnerships and PDL-1 negative highlighting the potential for combination with PD-1 blockade and there's a potential mechanism to overcome resistance to PD-1 treatment. Our approach for drug combination is based on the scientific and biological rational of the pathway were targeting and presented differentiated approach which offers an increase potential for monotherapy and combination treatment. In addition having this understanding of the expression pipelines of the ligands and receptors of this pathway presents Compugen with the opportunity to develop biomarker and patient enrichment strategies and select patients likely to respond to treatment. In June at ASCO, we held our first chemical investigators meeting to selected input on the dining and Phase I clinical trial for COM701. At the meeting we presented our COM701 Immune Checkpoint Program to a select group of leading clinicians each of whom are renowned experts in the clinically immune oncology field. The meeting was led by Professor Antoni Ribas from UCLA, Professor Drew Pardoll from Johns Hopkins University and Professor Charles Drake from Columbia University, all the opinion leaders who played major role in the cancer immunotherapy revolution. The purpose of the meeting was to hear the clinician's views on the COM701 Phase I clinical development plan and to discuss their possible involvement at investigator in a future trial. The information we provided regarding our northern TIGIT and the preclinical package of its antibody drug COM701 was very well received and we believe the solid desire by investigators to take part in our upcoming clinical trial. Based on their successful meeting we're now finalizing our Phase I clinical trial design. John will provide more details on our clinical development strategy intended to extract the full clinical and business potential of our lead profile. Last week, we also announced allowance of our first patent covering COM701 relating to methods of using COM701 for activating T-cells in cancer patients. The patent was issued under the USPTO Pilot program providing early reviews for patent applications pertaining to cancer and immune-therapy in support of the National Cancer Mutual Program. This was a one year pilot program launched by the USPTO in June 2016 and which was extended until December 2018. In view of the approximately 910 cancer immunotherapy patent application being received annually by the USPTO, the program was intended to move innovative new treatment from conception through regulatory approvals swiftly to ultimately reach patients factor. We're very excited that we are able to achieve this patent issuance for a leading terminal immune-oncology program particularly these are patent is one of less than a dozen patent granted under these programs to-date. These patents along with other pending applications in the U.S. and other jurisdictions are part of our global strategy to protect our assets. COM902 our anti-TG monoclonal antibody candidate is the second per clinical asset in our pipeline. It is an exceptionally high-affinity antagonistic antibody which we selected for its ability to enhance de-selectivation both alone and synergistically in combination with COM701. We are internally developing this antibody and intend to combine it with COM701 in clinical trials for various oncology indications. Currently, generation of a production cell line for manufacturing is in progress and we look forward to providing further update on the program as a consensus through non-clinical development. Thank you and I will now turn the call over to John. John?

[John Hunter:]

Thank you, Anat. As Anat noted, I will be directing my remarks today towards the early clinical development in positioning of COM701. Before I begin, I would like to quickly summarize the preclinical data that we recently presented at ASCO, as it guided our thinking on the design of the Phase I clinical trial. So on Slide 1, you can see an overview of COM701 program. And as a reminder, high affinity antibody, the target PVRIG a novel immune checkpoint discovered by Compugen, with its computation predictive discovery platform. We've now shown in a number of different preclinical studies, the COM701 is synergist with those digit and PD-1 pathway blockade and we see this as a benefit as a potential cancer treatment in different solid tumor indications. And we are looking at COM701 as having first in class opportunities both as a monotherapy and in combination with both TIGIT and PD-1 pathway inhibitors. We are currently on track to filing an IND in Q1 of 2018. Moving to the next Slide, in vitro studies we have shown while COM701 has monotherapy activity in terms of enhancing T-cell activation. We get synergistic effects when we combine COM701 with TIGIT inhibitor antibody. We've also seeing this effects with PD-1 combination as well versus in vitro and in-vivo and I will show you the in-vivo data shortly. But as you can see, we get similar effects with COM701 as we see with PD-1 and this is further enhanced when we combined, the two for a blockade of pathways. Additionally in some pathway systems, we've seen benefits of triples combination when we combine COM701 with TIGIT blockade plus PD-1 blockade suggesting that clinically there maybe opportunities for triple combination. Mechanistically, there is a rational for seeing a combination the PVRIG with TIGIT as well as PD-1 inhibition. As you can see shown in this slide, PD-1 doesn't back tie into the DNAM AXIS in that, if this starts correlates, and in activates DNAM limits down to a slide in PD-01. So, we believe that, we combine inhibition of PD-1 with PVRIG TIGIT or the two of them together we should see enhanced affects on T-cell activation, similar to what we've seen in preclinical studies. Our in vitro data has been supported in-vivo affects that we see with either PVRIG blockade or ablation in knock-out mice. As you can see on Slide 4, when tumors are grown in mice, the last PVRIG expression may grow more slowly than what we see when they are grown in type mice that has the PVRIG gene presence, and this suggest there will be monotherapy opportunities for using COM701 in the clinic. Additionally, when we treat these mice with a PD-01 blocking antibody, we now see a combination affect in the knock-out mice and that there is a further decrease in tumor growth in PVRIG knock-out mice, when you compare it to either vice type mice treated with anti PD-01 or the PVRIG knock-out which again supports the combination rational that we saw in the in-vitro studies. We've also managed to replicate this combination affect with dual antibody blockade of PVRIG and the PD-1 pathway where we've seen affects not only on tumor growth, but on survival in the combination treated antimals. As we also have looked for a combination with combination benefit with TIGIT blockade, in vitro, we've run some in-vivo model, where we look to see whether in mice that has TIGIT gene ablated and therefore last TIGIT expression, whether it's PVRIG blockade, you can give some benefit in terms of reducing tumor growth. And as you see on Slide 7, we do in fact see reduced tumor growth in TIGIT knock-out mice when they are treated with PD-1 blocking anticipate-body. How was the street clinical data was taken into account when we designed the Phase 1 clinical trial we have been working closely with our clinical advisors who have extensive experience in I/O clinical trials to design an aggressive Phase 1 study that will quickly establish phase visiting levels of -- while at the same time offering opportunities to serve any initial efficacy should note in targeted patients populations. While the clinical plan is still under review with our advisors we have nabbed out the overall structure that we'll be implementing for the Phase 1 trial. The Phase 1 trial will be performed in three distinct stages 1a, 1b and 1c. The first part of the study stage 1a will entail monotherapy dose escalation of COM701 in what is known as an outcomer solid tumor trial. This is an open label trial in which patients are not preselected based on cancer indication or prior therapies. These patients generally with us advance with these that have exhausted all of their available treatment options. This phase of the study will allow us to establish the maximum tolerated dose known as the MTE for COM701. In addition to establishing the MTE another goal for the study will include settling possible adverse events associated with COM701 treatment. As this will be the first time in anti TIGIT drug has an important patient these results will inform and guide the development strategy for the product candidate overall. Additional information as we look to gain at this stage is the understanding of how are drug works in humans. This information will include the pharmacokinetic COM701 in humans the valuation of possible surge that read the response that can be used to confirm efficacious drug levels and possibly some indication of what specific patients population will best respond in monotherapy administration of COM701. Because of preclinical data point the synergistic activity of COM701 with PD-1 pathway inhibitors on T-cell activation has demonstrated in our recent data at ASCO. The second part of the study stage 1b will evaluate the combination of COM701 with a commercially approved PD-1 pathway inhibitor. In order to increase the likelihood of generating early efficacy data the stage 1b combination arm will run in a parallel stagger delay design with the monotherapy arm of the study and will involve dose escalation of COM701 in combination with an approved fixed dose of PD-1 pathway inhibitor. As with the stage 1a portion of the trial the two goal is to establish a safe dose of COM701 over in this case it will be a safe dose when used in combination with a second checkpoint inhibitor. During stage 1b we will continue to monitor all of the same parameters outlined for stage 1a with an increasing focus on possible efficacy single in any responsive patient populations. Information from this stage of the trial will be used to determine which specific cancer indication and or patient population to focus on in the next stage of the study. The third part of the study is stage 1c will consist of expansion cohorts in which the combination of COM701 and PD-1 pathway inhibitor will be tested in patient population being likely to respond based on taken up from stages 1a and 1b and where we will further explore efficacy signals for combination treatment in the selected patient population. As PD-1 inhibitors are already established as the backbone of cancer immunotherapy our near term clinical combinations focus will be on PD-1 pathway inhibitors. However since our data also strongly supports COM701 combination with PVRIG inefficient our follow-up approach will be combined COM701 with COM902 our internally developed anti-TIGIT antibody. This approach will allow us to extract the full clinical potential of COM701 which will be tested both in two combination with COM902 and possibly in triple combination with COM902 and PD-1 pathway inhibitor. Overall our goal for a COM701 development program is to expand the number of diversity of cancer patients who are responsive to a checkpoint inefficient and to increase the depth and duration of benefit in those patients who have no but only partial responses to current checkpoint inhibitors we hope to achieve this monotherapy use of COM701 in cases where PVRIG is a dominant immune checkpoint in the tumor microenvironment or in combination use when there are multiple checkpoints limiting in new response against the tumor. As I noted previously, our early focus on PV1 pathway inhibitor combinations is due to their prevalence of their use in cancer treatment, together with our preclinical data indicating the COM701 can substantial enhance the effects of PV1 pathway inefficient. Our hypothesis is at the overall efficacy of anti-PV1 therapies maybe limited by PVRIG expression in certain tumors and a combination with COM701 will release multiple breaks on the immune system and enable a more complete anti tumor immune response in situations where the PV1 pathway is not predominant immune depressive mechanism such as in tumors that express no PDL-1 we believe that other checkpoints such as PVRIG incision maybe responsible for inhibition of immune response. Offering the opportunity for use of COM701 a monotherapy treatment or in combination with our TIGIT inhibitor COM902. Having seen the potent effects of COM701 and COM902 on T-cell activation in preclinical studies, we are excited to move these programs into the clinic to test their effectiveness in stimulating anti-tumor immune responses in patients. Thank you. And I will now turn the call to Ari.

[Ari Krashin:]

Thank you, John. The full details of our financial results can be found in the press release issued this morning. Net loss for the second quarter of 2017 was $9.2 million or $0.18 per diluted share compared to net loss of $6.6 million or $0.13 per diluted share for the second quarter of 2016. Our single largest category of expenses remains research and development expenses, which totaled $7.1 million for the second quarter of 2017 compared to $5.5 million in the second quarter of 2016. The increase in R&D cases primarily at our San Francisco site continue to reflect the increased preclinical activities, including manufacturing cost supporting the COM701 program as we move forward the IND filing, which is now planned for Q1 2018 as well as increased preclinical activities related to COM902. I would like to know that the contamination issue reported in June did not financially impact our R&D budget. As of June 30, 2017 we had approximately $46.1 million in cash and cash related accounts with no debt entering the second half of 2017 in consistent with the prior estimate total cash expenditures for the second half of 2017 are expected to be in the range of $16 million to $17 million bringing full year 2017 total gross cash expenditure to be in the range of $33 million to $34 million excluding potential cash inflows. Thank you. And we will now open the call for questions.

[Operator:]

Thank you. [Operator Instructions] First question is from Mike King of JMP Securities. Please go ahead.

[Michael King:]

Thanks for taking the question. I want you to drill down a little bit more on John's comments. Well, first of all, I'm trying to do that, let me just also congratulate you on naming Paul Sekhri as Chair. He is a highly regarded biotech, executive and I think it's a great move for you guys. So, coming back to the question for John, with regard to patient selection, I'm just wondering when you begin trials with -- in combination, well I guess, it doesn't matter single agent 701 or combo with PD-1, if you will be looking for PDL-1 expression at all, and it correlates with response or if you all just be taking all commerce and perhaps stratifying for presence or absence of PDL-1?

[John Hunter:]

Hi, Mike. We are planning on starting with our commerce just in parts where we can get you to those escalation studies more quickly to get drive the patient population and that's what enrollment, where we can we do plan to get that up at least from patients that may not be possible and maybe situation and when we have these biopsies we are going to look at the expression of our growth in checkpoint five years that we've been focusing on. So and that will include looking PDL-1 levels.

[Michael King:]

Sorry, so you are saying you will be looking for biomarkers beyond just PDL-1?

[John Hunter:]

Yes, yes sorry I mean we of course we will be looking at PVRIG, PVRLT, TIGIT, PVR, so we are going to try to get and really broad view of the checkpoint landscape in the tumors and hopefully we will be able to tie that back into patient response.

[Michael King:]

Got it, okay and also just as far as patient selection can you talk about whether you would expect. I assume all these patients would be somewhat PD-1 or PDL-1 experienced but maybe I'm jumping on to just you know, a logical conclusion but perhaps talk about that aspect of it and whether you are trying to amplify a response within a non-response to first line PD-1 inhibition, or are you trying to revive response to PD-1 inhibition?

[John Hunter:]

Yes, it's actually going to be a mix of patients that they have mentioned. We are not pre-selecting based on prior treatment because I think the likelihood of patients having seen PD-1 pathway inhibitors is going to depend on indication. However, ultimately our goal is to see if we can with COM701 yet responses in patients which didn't response to PD-1 inhibitors or in combination with PD-1 kind of extend responses that may have been seen with PD-1 along. So we are really quite open at this point and we are trying to cover as many different scenarios as possible.

[Michael King:]

Okay. And then, finally on PVRIG, do we have any understanding about correlation with tumor mutation burden or MSI status.

[John Hunter:]

Yes, we haven't publicly release the information on that but we are looking into that. Okay, so we will look forward to some future publication on that one I suppose.

[Michael King:]

Great. Thanks so much.

[Operator:]

Next question is from Brett Reece of Janney Montgomery Scott. Please go ahead.

[Brett Reece:]

Good morning. Thanks for taking my questions. One of the things that has given my client confidence you know, to stay with Compugen all these years you know, has been the impressive resume's of the people on the scientific board and the free resume's of the strategic advisors who have hit their start to Compugen. We reason that these folks with their backgrounds are better equipped and we are to understand the signs and potential of Compugen. Since this is one of the pillars of our continued confidence in Compugen, could you talk a little bit about what the skin in the game of these folks are going forward in Compugen and I really like to hear it on the strategic advisors Sigal, Holzman, and [indiscernible].

[Anat Cohen-Dayag:]

Yes, sure. And I would just say that in general these advisors and the key leaders that are engaged with the company, of course the reason that they are engaged with the company is their ability to assess the potential of what Compugen was generating along the year, the discovery capabilities and the pipeline of the company and now of course as we announced today also the Chairman, in general the advisors relate specifically to the advisors that are more on the business front, [indiscernible] and Steve Holtzman, first I must say this was fortunate that these advisors are engaged with the company, they're very helpful for the company, they are engaged on all fronts, the strategy, the pipeline, the business and they're working very closely with us.

[Brett Reece:]

Right, but is it these folks, is it just there reputational risk that they're putting on the line, is it the opportunity cost of their time because these are very accomplished people like doing other things, do they have a material economic risk or incentive to stay with Compugen and then these strategic advisors, how much time of their working day do they spend advancing the interest of Compugen?

[Anat Cohen-Dayag:]

I think that saying just reputation is some kind of under estimation, these are people that are industry veterans working with big pharma and biotech companies, I think that the reputation is very important one and in terms of time, these advisors are accessible to us when we need them and incentive, I guess that I cannot comment it would be appropriate for me to comment about material incentive for them. And in general I would say as I stated these are strategic advisors to the company, they are involved in all three fronts, the strategy, the pipeline, the business and as I stated they are accessible to us and we're fortunate to have these advisors engaged with the company like Compugen, which I think and I think that this is the reason that they are engaged with the company has great potential.

[Brett Reece:]

Right, right. And just one last one and this is kind of back of the envelope question from Lay Investors with respect to the Bayer collaboration, I do hear this kind of rumbling with the resources of Bayer plus your compelling science it took basically three and half years to determine that one of the two molecules just wasn't cutting it, because you're Bayer what you do going forward, is it going to be less of a timeframe and in our determination whether the other molecule bears any commercial fruit?

[Anat Cohen-Dayag:]

I think that just in order to put things in perspective maybe two to three and half years to make a decision on the second one but it took three and half years to make a decision on the first one to take it to the clinic and it is progressive. So that let's just put things in perspective. In general every target is a new opportunity brings the own challenges, it's a completely different story between different targets and it's not related to whether our discovery capabilities can predict something as we go faster in the assessment and the development stage or slower. In general, I would say and this is important for our investors to understand while novel target bring a huge potential as first-in-class and a better shot growth intellectual property position but in this case in most of the cases, these are molecules that research stage is done by Compugen or by the external laborator that is working with us. So that was need to be taken in place but nevertheless as I stated for one program it took three and half years to make a decision, not continuing for the other program, the three and half years move forward to advancing clinical science.

[Brett Reece:]

All right. Thank you for taking my questions.

[Operator:]

Next question is from [John Lassers] [ph]. Please go ahead.

[Unidentified Analyst:]

Yes. I've been a stockholder for 16 years and during my time period I had friends and people are new that I talked about CGEN too and they were about 20 people are in the side in the last three or four years they dropped out consistently start and then we want I don't want to say if there is left and I don't know what the safety [indiscernible] accomplished over the day break but we've had lot of great conference calls continually struggle to say that people why should they stay in CGEN, if you had any simple -- related to that is number one question, number one are you going to talk about the new program?

[Anat Cohen-Dayag:]

Sure. First we can start with why to stay with Compugen, it's a company even paid aside the discovery capabilities that we have, the computation and what they this could offer in terms of a future potential also in other areas on top of immune-oncology, I'll stay within immune-oncology, I think that we're a company that has novel target and not only novel target that you can find 10 or 15 years of research around that are accessible to others, we have novel targets that we identified through capabilities, a true opportunity for first-in-class drugs which is the key in this market. So in the last few years, we generated a pipeline based on this novel targets that we discovered, we have pre-clinical programs in our pipeline we have four programs at the pre-clinical stage moving from computer predictions to pre-clinical stage and we're moving onto to this clinic. We've generated a pipeline that starts to be sustainable in this respect and it's sustainable I mean getting to the clinic and we're hopeful that the additional programs that we have in the pipeline where we did not disclose yet will also forward to the stage where we can disclose more information about them. But the potential is there for first-in-class - for first-in-class drugs of this company.

[Unidentified Analyst:]

Yes, thank you. On the Moonshot program?

[Anat Cohen-Dayag:]

Yes, sorry yes, so with respect to the Moonshot program and there is not much more that I can say on top of what I was stating in the comments, in the prepared comments but I would just say that we're very proud be a selected by this program to get a grant for our patent. Obviously there was a competition as we, as we understand and did something that's state about today innovation that our molecule offers going back to the first section of your answer. I think the digital soft pointing to the amount of innovation this Compugen generated in its pipeline.

[Unidentified Analyst:]

Okay, thank you. Thank you.

[Operator:]

The next question is from Brian Coleman of Hawk Hill Asset Management. Please go ahead.

[Brian Coleman:]

Thanks. My question is about PVRIG, PD-1 combination potential. We never limits of PD-1 with roughly 70% to 80% of patients being non-responders and John said that there has been quite a bit of a synergy when the PD-1 and anti-PVRIG in combination and I'm wondering if there is a way that you can quantify what that synergistic population has been in your pre-clinical data.

[Ari Krashin:]

Hi, Brian. So, to-date a lot of the work that we have been doing tried to understand that has been in different soft systems and we think at least in part it relates to expression of the different logins and different systems so, for example if you have almost, PDL-1 expression and you had COM701 separated PD-1 blockade. You really don't see much of the effect where as we see more of an effect when we have both logins PVRL2 and PDL-1 expressed at higher level than the target sold because there are number of other Checkpoints and end of the sort of again trying to get it better understanding whether other Checkpoint logins or expressed in other systems. So, if something that will working out but we do think at least in part that relates to what Checkpoint are expressed of what level that were doing expressed.

[Brian Coleman:]

Okay. And then my second question is on kind of under business development side, early on over the past of couple of years there is kind of an trade-off discussed about Novel targets and Novel therapies on one hander. They're more risky on but on the other hand economics of moving a Novel drug candidate through trials and into the market are much greater than being 6,7,8 PD-1 drug to hit market and yet this quarter we saw fairly significant PD-1 deal with Beigene and Celgene. And I'm wondering even the discussions we're having now as you could use that as a kind of a metric or comp for kind of the discussions you are having around COM701 and some of the Novel targets.

[Anat Cohen-Dayag:]

I say that avoid using any metrics in order for us not to put ourselves into above the sophistic metric in general the economics have, we are stated that we are in discussion and all for program areas it would be hard put metric for all of them together, and in general the economics of the this type of this are dependent on multiple variable and it reflect the stage of the development reflects the competition. The amount of asset so, I would avoid that taking any significant metrics relating to be, that's it.

[Brian Coleman:]

All right. Thank you.

[Operator:]

This concludes our question-and-answer session for today. I'll now turn the call to our Anat for concluding remarks.

[Anat Cohen-Dayag:]

Thank you. I'd like to thank all of our shareholders and all participants of the call and I'm looking forward to share with all of you additional progress during the rest of the year. Thank you.

[Operator:]

Thank you. This concludes the Compugen Ltd second quarter 2017 Financial Results Conference Call. Thank you for participation. You may go ahead and disconnect.