Celldex Therapeutics, Inc.
Q4 2013 Earnings Call Transcript

Published: 3 Mar 2014

[Operator:]

Good day ladies and gentlemen and welcome to the Celldex Therapeutics Year-End 2013 Results and 2014 Strategic Outlook conference call. At this time, all participants are in a listen-only mode. Later we will conduct a question and answer session and instructions will follow at that time. If anyone should require operator assistance during the program, please press star then zero on your touchtone telephone. As a reminder, today’s conference is being recorded. You may now begin your presentation.

[Unidentified Speaker:]

Thank you. Good morning and thanks for joining us. Before we begin our discussion, I’ve been asked to direct you to Slide 2 and caution you that today’s speakers will be making forward-looking statements. Such statements reflect on current views with respect to future events and are based on assumptions and subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Certain of the factors that might cause Celldex’s actual results to differ materially from those in the forward-looking statements include those set forth under the headings Risk Factors and Management’s Discussion and Analysis of Financial Condition and Results of Operations in Celldex’s annual report on Form 10-K, quarterly reports on Form 10-Q, and its current reports on Form 8-K, as well as those described in Celldex’s press releases and filings with the Securities and Exchange Commission. All forward-looking statements are expressly qualified in their entirety by this cautionary notice. You should carefully review all of these factors and be aware that there may be other factors that could cause these differences. These forward-looking statements are based on information, plans and estimates as of this call, and Celldex does not promise to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes. Please be advised the question-and-answer period will be held at the close of the call. I’d now like to turn the call over to Mr. Anthony Marucci, President and CEO of Celldex Therapeutics. Anthony?

[Anthony Marucci:]

Good morning and thank you for joining us. Joining me on the call today are Chip Catlin, our Senior Vice President and Chief Financial Officer; Dr. Tom Davis, our Senior Vice President and Chief Medical Officer; and Dr. Tibor Keler, our Senior Vice President and Chief Scientific Officer. 2013 was an exciting year for Celldex and for the broader field of immune-oncology. I would be remiss if I didn’t take a few minutes this morning to talk about the evolving landscape. The Celldex team has been in this space now for more than 15 years and we’ve seen enthusiasm of immuno-oncology ebb and flow with the successes and challenges of various therapeutic approaches and drug candidates. 2013 was clearly a breakthrough year. The dialogue fundamentally shifted from if immunotherapy works to what can we do to make sure that we realize its full potential. The excitement is palpable across multiple audiences – physicians, scientists, patients, biotech and pharma companies, and of course investors. We think this excitement is here to stay and we share it. We founded Celldex on the fundamental belief that harnessing the power of the immune system would break significant barriers in drug development for a variety of devastating diseases. Eight years later, we have one of the most robust well staged pipelines in immuno-oncology. We entered 2014 with five drug candidates in the clinic, including two in registration studies, rindopepimut in front-line glioblastoma and glembatumumab vedotin in triple negative breast cancer. As we look forward to the future, we believe the next great challenge for immuno-oncology field is to further lock the immune system to deliver the greatest benefit to the largest populations of patients possible. We believe you get there through the use of novel combination approaches that seek to leverage the power of the immune system across multiple levels. Celldex is centered squarely in these crossroads. Many of our clinical programs have been designed specifically for combination therapy and to help engage the immune system. Critical to this strategy has been our ability to understand and exploit our own assets while also identifying promising external technologies to complement our pipeline. To this point in our call today, we would like to walk you through the key accomplishments of 2013 and outline our strategic objectives for 2014, which includes the initiation of at least four new Celldex-sponsored clinical studies and several investigative sponsored studies, including multiple combination regimens that leverage both our own internal assets and complementary external assets. We will also update you on two assets that are growing in importance and will be adding to our development this year

[Dr. Tom David:]

Our interest in DDD was inspired by important advancements in understanding the nature of this disease and preclinical work that supported the rationale for CDX 1135 in treating patients with DDD. We initially treated a patient with deteriorating kidney function under compassionate use. She had progressed to complete renal failure and was on dialysis when treatment started. Unfortunately CDX 1135 could not benefit the patient clinically, we were able to show that the treatment markedly improved C3 levels consistent with control of the abnormal C3 activation that is characteristic of acute DDD. With this result and preclinical data showing complete disease control in a relevant animal model, we felt that a small pilot study was justified to explore potential for 1135 in this C3 mediated disease. A key feature of the pilot program is the need to document a large clinical benefit that could be proven in a small number of these very rare patients; thus, the pilot was designed to enroll patients with active C3 breakdown and progressive and deteriorating kidney function but prior to complete kidney failure. As Anthony mentioned, these patients are very difficult to identify despite communication with many U.S. practitioners who take care of them. To support enrollment, we modified protocol and opened accrual to include patients who had received a kidney transplant, and a patient with DDD recurrent after his second kidney transplant was enrolled. He had been treated with eculizumab, or Soliris, for one year with inadequate disease control. The patient discontinued eculizumab and four weeks later began a course of twice-weekly 1135 treatments. Significant improvement was initially noted in clinical parameters, including urine protein to creatinine ratio, hemoglobin, systolic blood pressure, edemia, and hematuria, but these improvements were short-lived. After nine weeks of dosing with CDX 1135, the patient was taken off the pilot study due to declining clinical parameters, including an increase in proteinuria. While 1135 appeared to control the C3 breakdown, there was persistent inappropriate complement activity at multiple levels. CDX 1135 was discontinued and eculizumab treatment was restarted. Due to the improvement in clinical parameters seen while on CDX 1135, the patient and his responsible physicians requested a resumption of CDX 1135 in combination with eculizumab and a single patient protocol allowing the combination was recently established. Only two doses of CDX 1135 have been administered thus far, but the patient’s condition continues to deteriorate. Based upon the challenges we have experienced and the variable spectrum of potential complement abnormalities in DDD patients, continuing the development in DDD is extremely challenging. We have made the decision to close the DDD program. I’d like to echo Anthony’s comments – while it is difficult to close a study in the rare disease space where patients so clearly need options, we feel this decision is the best decision from both the clinical and business perspective. We have relayed this information to our investigators and emphasize our appreciation for their support and the generous participation by the patients and their families.

[Anthony Marucci:]

Thank you, Tom. Before we move on to the clinical development objectives for 2014, I’d like to ask Chip to review the year-end 2013 financials on Slide 10. Chip?

[Chip Catlin:]

Thank you, Anthony. For the year ending 2013, Celldex reported a net loss of $81.6 million or $1.02 per share compared to a net loss of $59.1 million or $1.02 per share for the comparable periods in 2012. The increase in net loss is primarily due to increased R&D expense to support our late-stage rindo clinical development program as well as the planning and initiation of the glemba Metric study and the expansion of the varli study. R&D expense in 2013 increased by $20 million compared to 2012. G&A expenses increased by $4.8 million to $14 million in 2013 primarily due to higher personnel-related expenses, professional services, and rindo-related commercial planning costs in 2013. At December 31, 2013, Celldex reported cash, cash equivalents and marketable securities of $303 million compared to $136.6 million as of September 30, 2013. The increase was primarily driven by net proceeds to Celldex of $181.5 million from an underwritten financing and net proceeds from the exercise of stock options of $2.5 million. These were partially offset by $2.1 million spent on leasehold improvements to our new headquarters facilities in New Jersey and our fourth quarter net cash for $115.5 million. As of December 31, 2013, Celldex had 89.2 million shares outstanding. Now I’ll turn it back to Anthony.

[Anthony Marucci:]

Thank you, Chip. As Chip mentioned, in 2013 we successfully completed two follow-ons, netting close to $280 million. We are extremely pleased with the shareholder base that supported these offerings and are grateful for your support. As a result of these transactions, our current cash will support our planned operations through 2016 which we believe will lead us to a BLA filing and potential approvals for rindo as well as the potential BLA filing for accelerated approval for glemba. In addition, we have expansion of the glemba program into two new indications, a significantly broadened development plan for varli, CDX 301 and CDX 1401, which I’m going to ask Tom to walk you through now. Tom?

[Dr. Tom David:]

On Slide 11, on December 2 we initiated Metric, the accelerated approval study for glembatumumab vedotin in triple negative breast cancer patients that over-express the target, gpNMB. The clinical team has already opened 32 of the targeted 100 centers in the U.S., Canada and Australia with the goal of accruing this study in 15 to 18 months. Our clinical and manufacturing teams continue to coordinate on all fronts, including development of our diagnostic assay and developing a commercial product that will be used in the latter part of this study and in future clinical studies of glemba as well. The Metric study will enroll approximately 300 patients randomized in a 2 to 1 ratio. Patients will be treated in a first or second line setting with either glemba or the control, Xeloda, also called capecitabine. If the accelerated approval study is successful, we will be able to market glemba for this triple negative indication while we seek full approval in the larger breast cancer population through a Phase III study in all gpNMB over-expressing breast cancers. We are currently developing additional trials to expand glemba into other oncology indications where we believe gpNMB plays an important role in disease. In 2014, we intend to initiate Phase II studies in metastatic melanoma and squamous cell lung cancer as outlined on Slide 12. We know from past studies in melanoma that glemba has approximately a 15% response rate and have designed this new study to see if enrichment with very high expression can lead to better response and survival based on expression levels of gpNMB. The study will enroll up to 66 patients with unresectable Stage 3 or Stage 4 gpNMB over-expressing melanoma who have progressed through or after standard therapies. They will be entered into cohorts based upon expression level and will be followed for overall response rate, progression-free survival, and overall survival. Squamous cell lung cancer over-expresses gpNMB at a high frequency and we will initiate an exploratory trial to estimate overall response rate, PFS and OS and a correlation with gpNMB expression. The study will accrue patients with unresectable Stage 3B or Stage 4 gpNMB expressing squamous cell carcinoma of the lung who have failed first or second line therapy. The study will include a dose escalation phase that may define a higher dose for this indication, and the Phase II portion will assess overall response rates in addition to correlations with expression level. The trial will enroll up to 55 new patients. These two studies will provide critical data in determining the size of our treatment effect in these patients with advanced disease and will add to our growing body of knowledge on the role of gpNMB as a potentially important target for cancer treatment. We are also establishing several other collaborative efforts to further expand glemba into additional indications. As you all know, there has been intent in immunotherapy as a treatment for cancer based upon its ability to both induce tumor shrinkage and prolonged survival. To date, the survival benefit, while very exciting, has been seen primarily in a limited number of patients and indications. The feature of immunotherapy lies in the expansion of these clinical benefits to a much larger proportion of patients. We believe combination approaches designed to deliver comprehensive control of anti-tumor immune responses can expand the efficacy to all patients. We also believe Celldex is uniquely positioned to play a leadership role in optimizing the immunologic anti-tumor effect of a number of immune modulatory molecules, both within our own pipeline and externally through combination approaches. We are particularly interested in generating potent anti-tumor responses using a combination of three of our pipeline agents, as seen on Slide 13

[Anthony Marucci:]

Thank you, Tom, for that review. As you can see on Slide 16, 2014 is going to be a significant year for Celldex. In summary, we will complete accrual of rindo Act IV Phase III registration study in front-line glioblastoma by midyear and complete accrual of the ReAct Phase II study in recurrent glioblastoma and report data on such studies at SNO meeting later in 2014. For glemba, we are focusing on ramping up the accrual of Metric, the accelerated approval study in triple negative breast cancer, and as Tom discussed, plan to initiate two additional Phase II studies in indications known to heavily over-express gpNMB, metastatic melanoma and squamous cell lung cancer. A major area of focus for us in 2014 will be expanding the varli development program. We will complete the Phase I study and plan to initiate a number of combination studies that Tom has discussed with a broad array arrangements of agents, including checkpoint inhibitors, a B-raf inhibitor, and tyrosine kinase inhibitors in melanoma. CDX 1401 will also enter at least one external sponsored study, initially in metastatic melanoma with 301. We will initiate a pilot study of CDX 301 alone and in combination with Mozobil in hematopoietic stem cell transplant and will continue to support the investigator-sponsored studies in B-cell lymphomas. I’m sure with all we have outlined here today, there are a number of questions, so at this time I will ask the operator to open up the call for your questions. Operator?

[Operator:]

[Operator instructions] Our first question comes from Howard Liang with Leerink.

[Howard Liang:]

Thanks very much for taking the call. Just have a couple of questions on the follow-up data on 1401, I think which is relatively new, at least to me. Can you talk about the time lag between discontinuing 1401 and receiving Yervoy? I think you gave the lung cancer number. And also for lung cancer, what were the checkpoint inhibitors the patients received?

[Dr. Tom David:]

With some of the melanoma patients, they had progressed when they came of study and fairly rapidly went on to initiate therapy with checkpoint inhibitors, specifically ipilimumab, and those patients initiated treatment within three to four months of completing 1401 study. The lung cancer patients similarly went on to fairly rapid treatment, but again at this point in time we’re not able to tell you specifically what drug they received.

[Howard Liang:]

Okay. For your study you plan to initiate with varli, can you talk about—it sounds like—is it a triple combination broadly—sorry, double combination with Yervoy but in NY-ESO positive patients, then you add 1401? If so, what percent of patients are NY-ESO positive in melanoma?

[Dr. Tom David:]

So you’re right, Howard – it’s a somewhat complicated design, but it gives us several specific advantages. Obviously the varli plus ipi combination is going to generate immune response, and then the checkpoint inhibitor can unleash that response. But the limitation there is without a specific antigen to follow, we’re unable to really assess immune responses and what impact we’re having, so in those patients who are NY-ESO positive and in our experience using our assay that runs to about 30% of melanomas, we will be able to assess for immunity prior to treatment and then immunity after initiation of varli, and of course we’ll be looking for a superior response when the checkpoint inhibitor is involved as well. So it’s a comprehensive study, but we think it will provide us plenty of useful information, and of course we’re hoping that we’ll see significant improvements from what’s already been seen with ipilimumab itself. Now, we are alluding of course to PD-1 with a similar trial design – again, we like that design because it does give us specific endpoints to follow in the NY-ESO positive patients. But we are still in the negotiation phase to determine how best to access PD-1 and that’s a somewhat more nebulous approach.

[Howard Liang:]

Could you talk about how soon can you start the Yervoy combination study?

[Dr. Tom David:]

So we’re well on the process of finalizing that protocol and activating the study. We would expect that trial to be going within the next three to six months.

[Howard Liang:]

Okay, great. Thanks very much.

[Operator:]

Our next question comes from Bret Holley with Guggenheim Securities.

[Bret Holley:]

Thanks for taking the questions. I’m just wondering on the combo Yervoy trial with varli. Do you have any idea of how large that cohort is going to be, at least with the double; and then is there a goal—as I understand it with the triple combination in NY-ESO-1 patients, what are you thinking of sizing? And I guess secondarily, going into that, what are your expectations? Where is the line in the sand, so to speak, in your view?

[Dr. Tom David:]

The line in the sand for activity?

[Bret Holley:]

Yes.

[Dr. Tom David:]

Well, the purpose of a Phase II study like this, of course, is to find out how much you can add. From our perspective, we would like to add at least 10% to the three-month response rate on top of what’s been seen with ipilimumab. However, there’s certainly potential for smaller or larger benefit to still be of value in further development, so this trial will mostly serve to estimate the effect so that we can design the next study. The patient numbers are—you know, there are still various stages we need to go through to finalize it, but you can expect approximately 55 to 60 patients who are NY-ESO negative and 40 patients who are NY-ESO positive, which of course balances out based on the percentage I described earlier.

[Bret Holley:]

And is the 10% also the line in the sand for the triple combination in NY-ESO-1 patients? I’m just trying to understand what the parameters are here.

[Dr. Tom David:]

So the small population who are NY-ESO positive, and we are looking for a slightly higher benefit there, the trial is designed around a 15% improvement.

[Bret Holley:]

Okay, thank you very much.

[Operator:]

Our next question comes from Mara Goldstein with Cantor Fitzgerald.

[Mara Goldstein:]

Thanks very much. Just two things – on the Metric study, can you just remind us of what the powering assumptions are behind—for the two different endpoints, the PFS and the OS? Please.

[Dr. Tom David:]

So the PFS endpoint is powered to detect 2.25 month improvement – of course, we’re hoping to see more than that.

[Mara Goldstein:]

Okay. Can you tell us what that powering is? Is that 80%, is that 90%?

[Dr. Tom David:]

That’s 80% power.

[Mara Goldstein:]

Okay, great. And on 1135, there is no compassionate use of that drug anymore, correct?

[Dr. Tom David:]

We do still have drug left. We certainly understand the need in these patients, and I would not rule it out; but we are not formally pursuing the program from the perspective of drug development.

[Mara Goldstein:]

Okay.

[Dr. Tom David:]

I should add, Mara, you had also asked about the response rate endpoint in the Metric study, and that’s 15 versus 30% response rate with the same powering at 80%.

[Mara Goldstein:]

Great, okay. And with rindo completing enrollment this year in the Act IV, is there some expectation for when the first data readout might occur on that trial?

[Dr. Tom David:]

Well, the interim analyses are all based on events, and you can’t tell until you get there. Our current estimates continue to be 50% the first interim at the end of this year, early next year, with the 75% approximately six months after that and final data in ’15 or early ’16.

[Mara Goldstein:]

Okay, thank you.

[Dr. Tom David:]

So it’s still early in the trial, and we’re making that estimate based on a relatively small number of events at this point, so our predictions will be much more accurate in the second half of this year.

[Mara Goldstein:]

Okay, that’s helpful. Thank you.

[Operator:]

Our next question comes from Boris Peaker with Oppenheimer.

[Boris Peaker:]

Good morning. I just wanted to clarify – on 1135, it seems like you guys made a decision on this drug based on one patient, but the patient that has had a kidney transplant and Soliris just doesn’t strike me as being kind of the average (indiscernible) disease patient. So can you just talk a little about it, how—just to make sure that the decision is not being made on an outlier patient for the whole program?

[Dr. Tom David:]

Well Boris, I think the key data from my perspective in this decision really is our ability to perform a study. Even if we could show dramatic effects in these patients, we would still have to treat 30 or 40 patients in order to have a package that was adequate for registration, and it’s quite possible that if we spoke to the FDA, they would want even more. Right now, of those patients who are at the right point in their disease where we can confidently say that 1135 has an effect, they’re just extremely rare and very difficult to accrue, so the decision is mostly driven by the fact that even if the drug worked spectacularly well, I’m not confident that I could complete a clinical trial.

[Boris Peaker:]

Okay, I see, I understand. Now on 1127, will you have any solid data, solid tumor data at ASCO, and maybe specifically what kind of data should we expect?

[Dr. Tom David:]

So I mentioned that we are completing enrollment of the expansion cohorts and analysis of the data, and we would expect to have the full outcome from 15 patients with melanoma and 15 patients with renal cell carcinoma for presentation at ASCO.

[Boris Peaker:]

Okay, great. Have you received, I’m curious, any inquiries from other pharmaceutical companies to combine 1127 with their specific checkpoint inhibitors?

[Anthony Marucci:]

We’re having discussion with those now, Boris.

[Boris Peaker:]

Great. My last question is financial – could you provide specifically cash burn for 2014?

[Chip Catlin:]

I think in the conversation we had, we’re very confident that we’ve got runway through 2016, so we haven’t given specific guidance on our burn.

[Boris Peaker:]

Well perhaps—I mean, you have many studies ongoing. I’m just curious if maybe you could some kind of just qualitative relative to 2013 burn? I mean, would it increase significantly or is 2013 a good run rate for ’14?

[Chip Catlin:]

We think for ’14 it will be anywhere between $90 million and $100 million, Boris.

[Boris Peaker:]

Great, thank you very much for taking my questions.

[Operator:]

Our next question comes from Jonathan Aschoff with Brean Capital.

[Jonathan Aschoff:]

I was wondering, is it just folks who get 1401 or is there any natural immunity to NY-ESO-1 that you’ve seen convey enhanced response to checkpoint inhibitors?

[Dr. Tom David:]

Very good question, Jonathan. There actually are several data sets now published showing that those patients who have an innate immune response against NY-ESO do go on to a better outcome. Jedd Wolchok from Memorial Sloane Kettering has published some of those data which are quite convincing that if you do have this target that the immune system can recognize, you’re more likely to benefit when the checkpoints are released. So of course, our hypothesis is that if we can create even stronger and more anti-ESO immunity at the beginning, we should have a better outcome.

[Jonathan Aschoff:]

Thanks a lot, Tom.

[Operator:]

Again ladies and gentlemen, if you have a question or a comment at this time, please press star then the one key on your touchtone telephone. Our next question comes from Biren Amin with Jefferies.

[Biren Amin:]

Thanks for taking my questions, guys. I guess I’ll start off with CDX 011. I think you’ve announced you’re starting this Phase II melanoma study. Just wanted to assess on gpNMB expression, is this greater than 25%, similar level to what you’ve targeted in metastatic breast? And I think you also ran a prior study in melanoma but these were not gpNMB expressed patients, so what were the key learnings from that study that you’re applying to this current trial? Thanks.

[Dr. Tom David:]

We have looked at a lot of different cases of melanoma and it’s clear that gpNMB is expressed in a much higher percentage of gpNMB patients at a higher level in melanoma than in breast cancer, so we actually look at melanoma as being quite a different disease from the perspective of gpNMB. We are currently expecting over 80% of patients to test positive and we expect that about 50% of patients will have levels greater than 80% of cells positive, so it will be a different threshold and we’ll be learning as we go. The previous study simply did not collect tissue, so we can’t tell what level of gpNMB expression many of those patients had, so we are definitely focusing on the tissue in this particular study.

[Biren Amin:]

And Tom, is it the same assay that you’re employing in breast that you’ll employ in this Phase II trial?

[Dr. Tom David:]

It’s not exactly the same assay. There are some tweaks that you need to make for it work optimally in melanoma, but it’s essentially the same reagents.

[Biren Amin:]

Okay. And then I guess for Metric, did I hear you correctly that the commercial assay will be available in the back half of the trial? I just wanted to confirm that.

[Dr. Tom David:]

Well no, we’re using the same assay throughout performed at a central lab, and those data will be the basis for approval of the diagnostic. There’s a co-diagnostic that would go along with the drug. We were referring to the commercial products, the actual drug that we think would go on the market at the end of the day, which is essentially the same as the product we’re using now; it’s just a question of standards of manufacturing in order to meet FDA requirements. We only mentioned that because it’s important, of course, to have your commercial product used within your pivotal trial in order to reassure the FDA that everything will be consistent.

[Biren Amin:]

And do you plan to run a bridging study between the two products?

[Dr. Tom David:]

Well, we believe that as long as we can include the drug in our pivotal study, that won’t be necessary.

[Biren Amin:]

Got it. And then one last question on CDX 1127 on the hemalignancy, those escalation cohorts, I think you mentioned that you’ve modified the protocol, but have you identified maybe a couple of areas where you could potentially move forward for a dose expansion cohort?

[Dr. Tom David:]

Well, we’ve definitely seen activity that would support expansion cohorts. It ultimately comes down to the feasibility of completing an expansion cohort versus doing a more definitive Phase II trial and what would make the most sense moving forward, so we don’t have specific plans until we finalize and can look at all of the data. But there definitely is the potential for some interesting development in hematologic malignancies. The amendment critically adds T-cell malignancy, a whole different area of malignancies that we had not been able to include in the trial until now, so I think that’s an important step forward. The T-cell malignancies will be going through a brief dose escalation as well, so you should think of that as a third component.

[Biren Amin:]

Great, thank you.

[Operator:]

Our next question comes from Greg Wade with Wedbush.

[Greg Wade:]

Great, thanks for taking my questions as well. Tom, could you just comment on where FDA stands now with respect to the typical combination drug rules? You’re proposing some novel-novel and novel-novel-novel programs, and just curious as to what the thinking is there. And then beyond GBM for rindopepimut, are there any plans to test the vaccine in other tumor types with this EGFR mutation? Obviously the quick activity in the GBM study is of interest, and other settings (indiscernible). Thanks.

[Dr. Tom David:]

Well, good question. I’ve always liked to do novel-novel-novel things. Realistically, the FDA have no objections to the combination of experimental therapies provided that you can justify the safety and the rationale behind doing it. We’ve been successful doing that in the past with our dendritic cell targeted vaccines where we’ve added as many as four experimental therapies together without any problem from the regulators. I think the main issue is usually getting the companies to work together and being able to access drugs from different pipelines to put them together. But the advantage we have here, of course, is that we basically have access to all of these agents internally and can control them ourselves. That said, we do need to put proposals in front of the FDA and make sure they don’t have any issues, but knowing that varli has a very safe profile, knowing that 1401 does as well, we can’t foresee that there will be any problems.

[Anthony Marucci:]

And Greg, those are the reasons why we did those Phase I—those escalations of both varli and 1401 and 301.

[Greg Wade:]

What I was getting at was the requirement to demonstrate the activity of novel drugs alone or in combination and proof components each contribute to the efficacy.

[Dr. Tom David:]

So we do have that kind of data from our Phase I studies that we can use. I think if we see that the combinations look exciting, we may need to do some additional single-agent work in subsequent trials, but at this point being able to accelerate to test the combinations together and really see what the potential is, is the most critical next step. I think your second question was around EGFRvIII and testing rindo in other settings?

[Greg Wade:]

Yes.

[Dr. Tom David:]

So as you know, there are literature out there suggesting that vIII is expressed in a broad range of different tumors. To date, using our specific assay, we’re not able to reproduce those results, so right now we have to acknowledge that we’re not sure how frequently vIII is expressed in other settings. We will continue to look at that in order to come to a final statement that we would then use publicly, but right now we have no plans to extend beyond brain tumors.

[Greg Wade:]

Thanks.

[Operator:]

Our next question comes from Steve Brozak with WBB.

[Steve Brozak:]

Morning, gents. Actually Tom, you just talked about something. I keep looking at Slide 4 every time there’s a presentation, and obviously you’ve got the four-year and five-year survival rates that are now just starting to become really—they stick out. Can you talk about the vIII positive accrutive factor in that, because that’s something that makes it even more interesting? And after that, I’ve got a quasi-commercial question to go into.

[Dr. Tom David:]

Well, I think you’re asking what the vIII positivity means for long-term survival.

[Steve Brozak:]

That’s pretty much what it comes down to, and how it really accentuates that visibility.

[Dr. Tom David:]

Well I mean, you look at the control population in that graph, it’s very compelling that nobody makes it out past four years, only one patient making it beyond two years. We have talked publicly about a collaboration we have with Radiation Therapy Oncology Group, who looked at a population of patients from one of their studies, RTOG 0525, for vIII expression and in collaboration with us. We presented some of those data, which suggest very few patients have long-term survival as well. Those are, of course, RTOG data, and we are working with them in order to get them published as soon as we can, but I think those data which are contemporary to Act III, so they’re not really historical controls, will again reaffirm what we show in that curve.

[Steve Brozak:]

Okay. Going on to your next—your NCI study, you obviously have great familiarity with that, and many clinicians focus and look on these studies and collaborations that you have, so what kind of feedback do you get when you do have an NCI-sponsored study where your expertise there and your collaborations with clinicians, obviously they look at it differently? And that will lead me into the commercial part of it – how do you perceive these in terms of the value to the clinicians?

[Dr. Tom David:]

Well, the National Cancer Institute, of course, brings tremendous resources and expertise to drug development, particularly when you work with the Cancer Therapy Evaluation Program who have been doing drug development for years and actually have provided supplemental indications to many of the drugs currently on the market. So being able to collaborate with them, having their expertise, having them apply their resources and their researchers to it, we feel is a tremendous boon. The general paradigm, you pursue your primary indication yourself and priority indications as quickly as you can, but then work with the National Cancer Institute to expand, and those are essentially the relationships that we’re trying to establish now. The Cancer Immunotherapy Network that I alluded to does contain some of the most significant researchers in the immunotherapy space, so being able to work with them as well as the NCI at this point I think positions us very well in the middle of immunotherapy for melanoma.

[Steve Brozak:]

Okay, and I’ll end on this, then – you’re looking at—you earlier on the call mentioned that you were hiring some people to start to address the visibility with clinicians and the information. Given the fact that it’s a relatively small universe, the number of people that you have and the KOLs that you’ve got on board, that should start the process pretty well in terms of making people that aren’t aware that they should be as to what the possibilities are for different therapy combinations into the future. Would you say that you’re probably in a pretty strong position given the fact that people should already know your technology if they’re in the field, and these new people that you’re bringing on board will be a fairly rapid conduit into making sure that they are aware? And I’ll jump off after that – thanks.

[Anthony Marucci:]

Yeah Steve, this is Anthony. The group that we brought on does have a tremendous amount of commercial experience at their prior companies, so they’ve done many, many launches and they are pretty good at getting access to KOLs and the important parties for these discussions. In the meantime, the studies that we’ve run, rindo in particular, as I said on the call, is in the hands now in 200-plus sites around the world, so especially for that drug we think there’s going to be a pretty efficient uptake of the drug launch, and we’re doing the same thing now in the Metric study with 100 sites and varli in some of the other programs. So I think between the fact of this group having a lot of experience with the KOLs that we’ve had, relationships with for years going back to 15 years, I think we’re in a pretty good position going forward.

[Steve Brozak:]

Great, thanks Anthony.

[Operator:]

I’m not showing any further questions at this time. I’d like to turn the conference back over to Anthony Marucci for closing comments.

[Anthony Marucci:]

Thank you Operator, and thanks everyone today for joining us. We believe Celldex enters 2014 with one of the most robust, well staged pipelines in the immuno-oncology field. By the end of the year, we’ll have completed enrollment in two studies for rindo, including most importantly our registration program. We should be closing in on completing accrual on the accelerated approval study for Metric with glemba in triple negative breast cancer while also broadening that program into additional indications. We will have initiated multiple Phase I and Phase II studies, including what we view as important combination studies that could play a very important role in the evolving future of immuno-oncology. We look forward to keeping you up to date throughout the year, but as always we welcome your questions at any time. We thank you for your time today and have a great day. Thank you.

[Operator:]

Ladies and gentlemen, this does conclude today’s presentation. You may now disconnect and have a wonderful day.