Five Prime Therapeutics Inc
Q4 2017 Earnings Call Transcript

Published: 28 Feb 2018

[Operator:]

Good day ladies and gentlemen. And welcome to the Five Prime Therapeutics Fourth Quarter and Fiscal Year 2017 Earnings Call. As a reminder, this conference may be recorded. I’d now like to introduce your host for today’s conference, Ms. Heather Rowe, Senior Director, Investor Relations, and Corporate Communications. You may begin.

[Heather Rowe:]

Good afternoon and thank you for joining us. I’d like to welcome everyone to our conference call to discuss results for the fourth quarter and full-year 2017. We issued a press release this afternoon and also posted slides to accompany this presentation. The slides can be found under the Investor Relations section of our website, under Events and Presentations. Joining me today are Mr. Aron Knickerbocker, Chief Executive Officer; Dr. Helen Collins, Chief Medical Officer; and Mr. Marc Belsky, Chief Financial Officer. Today’s conference call will include forward-looking statements under the Private Securities Litigation Reform Act of 1995, including statements regarding our research and development programs and financial outlook. Actual results may differ from those indicated by these forward-looking statements due to numerous factors, including those discussed in the Risk Factors section of our SEC filings. Our expectations and assumptions could change. While we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so, even if our views change. I will now turn the call over to Aron.

[Aron Knickerbocker:]

Thanks, Heather. Good afternoon and thanks for joining us today. We’re excited to review 2017 and talk about our outlook for 2018. Before diving into the details, I first want to talk about the compelling value proposition for Five Prime, as shown on slide three. First, we have a comprehensive IND engine that’s hard to copy and we think it’s industry-leading for the discovery of novel pathways and targets in immuno-oncology. We mention this often, but I’d ask you stop and think about what that means and the opportunity it provides for Five Prime. We believe our comprehensive proprietary libraries of the extracellular protium, our differentiated screening capabilities and protein therapeutic generation and engineering capabilities comprise a unique and powerful IND engine that will continue to generate important development programs. We have several undisclosed research programs at different points of the early target validation and molecule generation phase that have the potential to yield our next wave of development stage therapeutic biologics. And we continue to fuel this process at the earlier stages, with new screens planned this year. These are focused on two different immune cell types that will elucidate our understanding of immune system processes and the tumor micro environment and yield new drug targets. The fruits of these efforts are often hard to discern for those outside the company, as this work occurs at an early stage. But eventually, this leads to additions to our pipeline and that brings me to my second point. We have a rapidly expanding pipeline and we are transitioning into late-stage development. Our success with our drug discovery platform has led to a pipeline that’s on track to more than double to five development programs in clinical trials across multiple indications in 2018. You can see our pipeline on Slide 4. And third, we continue to enter into strategic collaborations and potentially accelerate our path to global commercialization, help expand our development programs, and secure funding. These strategies alliances coupled with our strong balance sheet position us well to advance our multiple assets. 2017 was a year of continued progress across our pipeline. I’ll take you through these at a high level, and then, Dr. Helen Collins, our Chief Medical Officer, will provide additional details later in the call. Highlights can be seen on slide five. cabiralizumab is our or CSF-1R antibody. With our partner Bristol-Myers Squibb, we reported initial clinical data from our ongoing Phase 1a/1b trial, evaluating the safety, tolerability and preliminary efficacy at the immunotherapy combination of cabira with BMS’s Opdivo in advanced sold tumors. Notably, in a cohort of heavily pretreated patients with advanced microsatellite stable, or MSS pancreatic cancer, durable clinical benefit was observed in 16% of patients with an objective response rate of 13%. This type of cancer is associated with tremendous unmet need, and is one in which no responses to immunotherapy have been demonstrated. To further put this into context, Onivyde, the most recently FDA-approved drug for patients with pancreatic cancer, demonstrating objective response rate of 7.7% when given in chemotherapy triplet with 5-FU and leucovorin. We along with many in the pancreatic key opinion leader community, believe this is incredibly important data. Of cancer deaths, pancreatic cancer is the number four killer in the United States. The chart on slide six shows you the change in cancer survival rates for the major tumor types over the last several decades. Suffice it to say, we have made precious little progress as a medical community in the treatment of pancreatic cancer. You can see it’s dead last in terms of five-year survival rates over this period. So, based on the importance of our clinical trial data, BMS initiated a randomize Phase 2 clinical trial, evaluating the combination of cabira and Opdivo in approximately 160 patients with locally advanced or metastatic pancreatic cancer. This milestone triggered a $25 million payment to Five Prime. Subsequently, we also completed enrollment of all Phase 1b cohorts in our ongoing Phase 1a/1b trial. Also noteworthy is the ongoing Phase 2 trial of cabira and PVNS. We have orphan drug designation for this development program, both in the United States and Europe. We believe this is an important area of exploration given the chronic nature of this disease and a prevalence of diffuse PVNS that we estimate at 67,500 in the United States, the five major markets in Europe and Japan. You can see these estimates on slide seven. And 2017 was also an important year for bemarituzumab, also known as FPA144. For short, we’ll called it bema. We presented data at the ASCO annual conference that demonstrated single agent activity in late line gastric cancer. Based on our clinical experience to date, we’ve recently initiated the safety lead into our FIGHT trial, a Phase 1/3 registrational study evaluating bema in combination with chemotherapy in front line gastric cancer. This is our first, global registrational clinical trial, and Helen will talk more about this in a moment. There is a sizable global market opportunity for bema in the front line leader of FGFR2b positive gastric and gastroesophageal junction cancers you could see on slide eight. Let me talk more about the importance of China to the FIGHT trial. China has more than 40% of the global number of new cases of gastric cancer worldwide, that’s about 700,000 new patients a year. In recognition of the importance of China, I’m pleased to tell you that in December, we filed a clinical trial application or CTA, which is the equivalent of IND for bema in China. We believe this will allow us to expedite enrollment in our FIGHT trial. To further help us capture this market, accelerate our pivotal trial and significantly lower our global development costs, we recently announced a strategic collaboration with Zai Lab in Greater China. Zai has experienced and proven management team and a business model that’s focused on bringing innovative therapeutics to the Greater China market. We earned $5 million upfront payment, and we’re eligible to receive up to $39 million in development and regulatory milestone payments. In addition, we’re also eligible to receive a royalty percentage on net sales of bema in Greater China from the high-teens to low-20s. And beyond our Zai collaboration, we made impressive progress with our other collaborations. In December, BMS filed an IND for our fully human monoclonal antibody in TIM-3, an immune checkpoint receptor that is known to limit the duration and the magnitude of T-cell responses. This triggered a $5 million milestone payment from BMS under our immuno-oncology research collaboration. And this is the first time, IND coming out of this research collaboration with BMS. And we have other programs underway in this alliance. As a result of our achievements to date and the power of our discovery platform, BMS again extended the research term by an additional year to advance antibody programs beyond TIM-3. We also achieved the $500,000 payment in August when GSK exercised its right to exclusively license a drug target discovered by Five Prime in the respiratory disease collaboration between the companies. This is the second respiratory disease target the GSK licensed under this collaboration. I’m really proud of the breadth, depth and growth of the Five Prime pipeline and I’m repeatedly impressed with our team’s ability to execute across all of our programs. With that, I’ll now turn the call over to Helen, to talk more about our clinical programs.

[Dr. Helen Collins:]

Thank you, Aron. We are excited about the progress made across our development programs. I’ll start on slide nine with cabiralizumab, our antibody to the CSF-1 receptor on macrophages that we’re developing in oncology in PVNS. In oncology, the rationale to eradicate cancer cells by targeting two different immune cells in the tumor micro environment. We are combining cabira’s innovation of CSF-1R to reduce tumor associated macrophages with BMS’s PD-1 inhibitor Opdivo to remove the checkpoint on CDA positive T-cells. We achieved our goal at the end of 2017, to complete enrollment of the Phase 1b cohorts in this trial. As shown on slide 10, you can see we enrolled approximately 210 patients across seven different tumor settings. Based on the encouraging pancreatic data we reported last fall, we and BMS decided to enroll additional patients with pancreatic cancer, and this will give us more than 50 patients worth of efficacy and safety data in late line pancreatic cancer. As Aron mentioned, last November, we along with BMS, reported initial safety data from 229 patients as well as efficacy data from the initial pancreatic cancer cohort from this trial. The results are summarized on slide 11. The pancreatic cancer physicians on our study were the first to point to us that observing objective, durable responses with non-chemotherapy treatment was unprecedented in pancreatic cancer. In particular, PD-1 inhibition alone has not shown responses in patients whose tumors are microsatellite stable or MSS which is 98% of patients with pancreatic cancer. As all of the 16% of patients in our study who had durable clinical benefit, had MSS, the responses are not explainable by Opdivo alone. To understand why the KOLs are so enthusiastic about this data, the preliminary results of cabira and Opdivo in pancreatic cancer need to be put into context. Pancreatic cancer is a disease setting, which serves tremendous unmet need. In the metastatic setting only 16% of patients are alive at one year and 3% at five years. As Aron mentioned, Onivyde is the most recently approved therapeutic in this disease and the chemo combination of Onivyde and 5-FU with leucovorin in second line and later patients with pancreatic cancer reported an objective response rate of almost 7.7% and an overall survival of six months. In comparison, in the cabira plus Opdivo data, we presented last fall, we saw a confirmed objective response rate of 13% with durability extending from five to nine months at the time that data cut-off. In terms of safety, the adverse event profile was consistent with cabira monotherapy and Opdivo monotherapy, the most common treatment related adverse events were asymptomatic elevations in creating kinase serum liver enzymes such as AST and ALT. Based on these data, BMS is moving ahead with cabira. For example, they have taken over cabira manufacturing. Also in collaboration with their partner Ono, they are enrolling a Phase 1 study in Japan of cabira alone and in combination with Opdivo which will support future global development. Also, this January, BMS enrolled their first patient in a randomized Phase 2 clinical trial evaluating cabira and Opdivo with and without chemotherapy in patients with advanced pancreatic cancer. This Phase 2 trial depicted on slide 12 is planned to enroll approximately 160 patients in this second line setting of locally advanced or metastatic pancreatic cancer. BMS’s study design is based on the clinical data we presented last November as well as preclinical data from Five Prime and others that demonstrated synergy when a CSF-1R and PD-1 antibody are combined with chemotherapy and pancreatic cancer models. We believe their trial design is the ideal way to quickly determine the path forward for cabira-Opdivo combination. The study tests the combination with chemotherapy backbones that are used in either first or second line of therapy and also include a control arm. We are also developing cabira as a monotherapy in an ongoing Phase 2 trial in patients with PVNS, which is a non-malignant tumor of the joints, the trial design can be seen on slide 13. At ASCO last year, we presented preliminary Phase 2 data that demonstrated efficacy with dosing every two weeks. While there were no dose limiting toxicities at doses up to 4 milligrams per kilogram every two weeks, some patients with PVNS discontinued treatment due to tolerability. We are now enrolling up to 30 additional patients in this trial to refine a dosing schedule. Based on the feedback from our investigators and the PK and PD data from the initial 30 patients, we believe there is potential to maintain the efficacy with greater tolerability using a frequent and more flexible dosing schedule. Data from these additional patients are intended to enable this decision on whether to advance cabira into a pivotal trial in PVNS which we expect to make by the end of this year. Let’s turn our attention now to bemarituzumab, also known as FPA144. As shown on slide 14, bema targets FGFR2b overexpressing tumors and is designed to enhance ADCC. Last year at ASCO, we showed single agent activity with bema in late line gastric cancer. And based on this data, we recently initiated a Phase 1/3 global registrational trial. We’re calling this study the FIGHT trial. We designed this trial to achieve front-line approval for bema in patients with FGFR2b overexpressing advanced stage gastric or GE junction cancer. You could see the schema for this study on slide 15. The FIGHT trial design is the gold standard, double-blind, placebo-controlled trial with overall survival as its primary endpoint. It compared bema plus modified FOLFOX6 chemotherapy to placebo plus modified FOLFOX6 in the 10% of patients with advanced gastric or GE junction cancer whose tumor is overexpress FGFR2b or our FGFR2 gene amplified. We dosed the first patient in the Phase 1 safety lead-in portion of this trial this past December. And the Phase 3 portion of the trial is expected to begin later in 2018. This trial will be global with sites in the U.S., Europe, and Asia. The latter will include China, South Korea and Japan where the incidence of gastric cancer is high. In addition to gastric cancer, we are evaluating bema as the potential treatment for patients with other tumor types that overexpress FGFR2b and we continue to enroll patients with metastatic bladder cancer in the ongoing Phase 1 monotherapy trial. Moving on to FPA150, our first-in-class B7-H4 antibody. This antibody which is shown on slide 16 is designed with two mechanisms of action. To block an inhibitory T-cell checkpoint pathway, and to enhance killing a B7-H4 expressing tumors by ADCC. B7-H4 is overexpressed in multiple solid tumors including breast, bladder, and gynecological cancers such as ovarian and endometrial cancer. In December 2017, we submitted an IND for FPA150, and we planned to initiate dosing -- dose escalations in unselected patients with any solid tumor in the first half of 2018. The design for the Phase 1 trial is shown on slide 17. Once the dose is selected, we plan to enroll patients in expansion cohorts to a breast, ovarian, endometrial or bladder cancer. We’ve chosen these tumors based on the high overexpression of B7-H4 and high unmet needs in these tumor settings. Despite the hundreds of trials being conducted in the IO space, we’re finding investigators are very enthusiastic as none of the IO therapies in particular are approved in breast, ovarian and endometrial cancer. Turning now to our research and preclinical pipeline. We believe our drug discovery platform positions us to more efficiently identify the next wave of targets that reprogram cells in the tumor microenvironment. Our unique platform serves as an IND engine to generate novel therapeutics, as shown on slide 18. The first of the next wave of new drug candidates is FPT155, as shown on slide 19. This is a first-in-class CD80-Fc fusion protein that activates T-cells through multiple pathways. FPT155 blocks CTLA-4 from competing for endogenous CD80, allowing CD28 signaling to prevail in T-cell activation and also directly engages with CD28 to further enhance its co-stimulatory activity without causing super agonism. We featured preclinical data with FPT155 in a poster presentation at the triple meeting in October last year on work done in preclinical models with FPT155 suggests this agent has the potential to have strong single agent antitumor activity and synergistic efficacy, when combined with an anti-PD1 agent. We anticipate filing an IND application or foreign equivalent for FPT155 in the second half of 2018. I’ll now turn the call over to Marc, to review our financials.

[Marc Belsky:]

Thank you, Helen. The full details of our financial results can be found in the press release issued this afternoon as well as slides 20 and 21. We continue to have strong balance sheet. Cash, cash equivalents and marketable securities totaled $292.7 million, on December 31 2017, compared to $421.7 million on December 31, 2016. On January 29, 2018, we completed an upsize public offering, resulting in net proceeds of approximately a $108 million. Net loss for the fourth quarter of 2017 was $29.2 million or $1.04 per basic diluted share compared to a net loss of $20.1 million or $0.73 per basic and diluted share for the fourth quarter of 2016. Full-year 2017, net loss was $150.2 million or $5.38 per basic diluted share compared to a net loss to $65.7 million or $2.44 per basic and diluted share for the full-year 2016. Collaboration and license revenue was $13.2 million for the fourth quarter of 2017 compared to $8.3 million in the fourth quarter of 2016. This increase was due to the $5 million milestone from BMS, for the first IND filing for a therapeutic candidate under our immuno-oncology research collaboration. Collaboration and license revenue was $39.5 million for the full-year 2017 compared to $35.8 million for the full-year 2016. This increase was due to the aforementioned $5 million milestone and increased revenue from the cabira collaboration agreement with BMS. R&D expenses totaled $32.7 million for the fourth quarter of 2017 compared to $29.1 million for the fourth quarter of 2016, and totaled a $150.9 million for the full-year 2017 compared to $94 million for the full-year 2016. This increase over the prior years was primarily related to advancing the bema program in a Phase 1 clinical trial, advancing the cabira program in immuno-oncology and PVNS, advancing the FPA150 program to an IND application, and advancing our internal immuno-oncology pre-clinical and research activities. G&A expense totaled $10.5 million for both the fourth quarter of 2017 and 2016 and totaled $40 million for the full-year of 2017 compared to $35.8 million for the full-year 2016. This increase over the prior year was primarily due to increases in facilities expense related to our new corporate office, stock-based compensation and spending associated with the development of our commercialization strategy. And looking ahead, we expect full-year 2018 net cash used in operating activities to be less than $135 million. This amount includes the $25 million milestone under our cabira collaboration agreement with BMS, which we earned when they initiated the Phase 2 clinical trial that Aron and Helen mentioned earlier. We estimate ending 2018 with approximately $250 million in cash, cash equivalents and marketable securities. I’ll now turn the call back to Aron for closing remarks.

[Aron Knickerbocker:]

Thank you, Marc. We believe we have a platform that positions us to find the next wave of targets and drugs to reprogram [ph] cells in the tumor microenvironment. Our success arises from our ability to answer original questions about the fundamental roles that thousands of extracellular signaling proteins play in the disease process. We believe that the new pathways revealed by these insights and the identification of drug targets will allow us to develop new therapies to treat patients with serious diseases. As a result, I have great confidence in the future of Five Prime. We have two derisked clinical assets cabira and bema, that have already shown signs of efficacy in different disease settings and with accessible safety profiles. In addition, we will add two first-in-class molecules, FPA150 and FPT155 to our clinical pipeline this year. And furthermore, we have an IND engine that will continue to fuel the organic growth of our pipeline with first-in-class candidates. We believe few companies of our size have similar capabilities and expertise. And 2018 is an important year for us, you can see this on slide 22. We’ll launch a global Phase 3 trial with bema, the cabira IO program is advancing, we we’ll make a go, no go decision on PVNS this year, and our clinical pipeline is more than doubling. Our strategic partnerships and our strong balance sheet position us to further advance these multiple assets. Finally, before we open up the call for questions, I want to express my sincere appreciation to the numerous patients and investigators participating in our clinical trials, our Five Prime employees and our strategic partners. And so, now, open it up to questions.

[Operator:]

Thank you. [Operator Instructions] Our first question comes from Kennen MacKay of RBC Capital Markets. Your line is now open.

[Caroline Chen:]

Hi. This is Caroline Chen on for Kennen MacKay. Thank you so much for taking our questions. So, just one quickly on the high level. Can you please go over some of differentiating features that actually FPA144 has from other FGFR inhibitors? And also, can you also comment on the competitive landscape of gastric cancer therapy, especially given there was progress with KEYTRUDA [indiscernible] study in the second line gastric cancer. That be good. Thank you so much.

[Aron Knickerbocker:]

Yes. Okay, thanks, Caroline. This is Aron. I’ll start and then Helen can talk about some of the clinical work going on in gastric cancer. But, with respect to your question about bema or FPA144, and it’s differentiation versus other FGFR2 targeted compounds. The first thing I would say is there is no -- to our knowledge, there is no other FGFR2b specific antibody in clinical development. And that’s important, because this is a unique splice variant of the FGF receptor 2, that’s overexpressed on a subset of gastric cancer tumors, about 10% and some other tumors as well, such as bladder, as we mentioned and others. But our antibody is uniquely selective for FGFR2b. And so, it avoids any of the off target effects that you might get from inhibiting the other FGF receptor family members. So, there are actually six different FGF receptors, 2b being one of those, and our antibody targets selectively. It also has two mechanisms of action. Number one, it blocks the ligands that signal through FGF receptor 2. Those are the FGF7, 10 and 22. So, it turns out signaling that ligand dependent, but additionally we’ve engineered it to have enhanced ADCC or antibody dependent cell killing. So that recruits NK cells more effectively into the tumor to attack and kill the tumor cells. So, this is a point of differentiation, for example, versus small molecule approaches such as tyrosine kinase inhibitors that we think indiscriminately inhibit the kinase domain of the FGF receptors. They don’t engage ADCC, but they also are associated with off target effects due to broad inhibition of FGF receptor signaling, notably hyperphosphatemia, but some of them have also been plagued with fatigue and asthenia, and changes that are -- that make those drugs less tolerable. So, in contrast, we have an antibody that’s very selective for the FGF receptor 2b target and you can identify the patients who’d be most likely to benefit from it by two companion diagnostic tests, either IHC see, that detects protein overexpression on the tumor or ctDNA which detects gene application and circulate tumor DNA in the blood. And then, you had a question about competition in gastric cancer and you mentioned some of the anti-PD-1 programs there.

[Dr. Helen Collins:]

Yes, I wasn’t sure like what the actual question was about the competition?

[Caroline Chen:]

Yes. If you can I guess sort of broad level go over some of the competitions in the gastric cancer therapy that would be very helpful. Thank you so much.

[Dr. Helen Collins:]

Well, I guess at a high level, I mean, certainly, we’re aware that there are other front line trials underway that are using PD-1 antibody. Obviously, Merck has their pembrolizumab trial BMS has their ipi Yervoy study. I think, this is a different mechanism of action, and I’m not sure that I understand exactly what the potential question is.

[Aron Knickerbocker:]

Well, maybe I’ll just add to what Helen is saying. We are aware of checkpoint inhibitors kind of into the space. FGFR2b is different. It’s a tumor antigen, so to speak that we’re using to engage in K-cells and attack tumor cells that overexpress this target. What’s important to note that patients who do overexpress it have diminished survival. So, it’s our hypothesis that patients in the trials we have FGFR2b positive tumors are not likely to live as long as patients who do not have FGF receptor 2b positive tumors. And therefore, it’s a very negative prognostic sector. That’s one point to consider versus say the checkpoint approach, which is a broader approach and doesn’t necessarily target something that’s associated with the worst prognostic factor. And the checkpoint inhibitors have not been successful as monotherapies in gastric cancer. There have been some recent failures in monotherapy applications of checkpoint inhibitors. That said, we do have preclinical evidence that combining FGF receptor 2b antibodies with anti-PD-1 antibodies can be synergistic. So, that is a possibility for us in the future. But we’d like to see how it plays out with checkpoint inhibition in gastric cancer.

[Operator:]

Thank you. Our next question comes from Chris Shibutani of Cowen. Your line is now open.

[Chris Shibutani:]

Well, thank you for taking my questions. Hi Aron, hi Helen. My starting question is on the responders, the durable responders you saw in pancreatic patients. Is it possible at this point for you guys to provide an update on those patients or whether they’re still under study? I think and there are 3 out of 4 patients that are still under study at that point. So, any update on that?

[Dr. Helen Collins:]

So, this is Helen, I’ll answer that. So I’m sorry, that we haven’t given any update on the how the patients are going. Again, as you know, this is a competitive space; there are a lot of people looking at combinations of CSF-1 with PD-1 inhibitors. And so, all I can do is say that when BMS agreed that we needed to enroll quickly and we completed enrollment with an additional approximately 30 patients as well as BMS moving forward in their randomized study. But, I can’t give you any update on the patients that are on right now.

[Chris Shibutani:]

Got it, got it. And so, Helen, just following up on the CSF-1R. We also saw like the small molecular approach already come to us, so that CSF-1R inhibitor, they also saw signal in pancreatic and maybe even in ovarian. Can you talk to the little bit of both since we -- you’re kind of signaling both of large and small molecule? What could potentially differentiate you there specially, if you could specifically talk about the adverse event profile and developing there?

[Dr. Helen Collins:]

Yes. So, we only know about just probably what you know about what’s been publicly presented. And we are aware of their melanoma response in that potential that ovarian response -- I am sorry, pancreatic. And they presented their safety data in a different way than we did. So, it’s sort of an apples and oranges. I mean again, I think what we clearly saw was whatever you see with cabira monotherapy, whatever you see with Opdivo monotherapy as what we saw with the combinations. So, there is no additive toxicity. And again, so that’s all I can comment on.

[Aron Knickerbocker:]

Yes. It’s hard to make sort of for us agent comparisons at this stage. We don’t know in the cases of pancreatic cancer responder, how durable that response was. We also don’t know if that patient had MSS or MSI disease that was reported at least in the poster that was presented. So I think we can’t really comment on that program beyond what’s been shown publicly. We are confident that with our dose of cabira, we can get good inhibition of the macrophage lineage. And that speaks to bringing down TAMS in the tumor microenvironment. So, we believe we have the right dose to go forward and have effective suppression of TAMS, which is what we want to do, because they’re very immuno-suppressive cells and then with high levels in pancreatic cancer. So, if you can remove them from the microenvironment, that coupled with removing the checkpoint inhibition of CDAT cells we think bodes well for activity in that setting. And I’d also add that we have combination data as Helen mentioned with chemo where we see synergy by adding anti-CFS-1R, anti-PD-1 and chemo in pancreatic cancer models. So, we like that approach for the BMS Phase 2 trial.

[Chris Shibutani:]

Got it. Very helpful. And maybe a question on the bladder cancer patients you are enrolling with FIMA. [Ph] Can you talk a little bit of like how many patients you’ve treated so far and are there any challenges in finding FGFR2b patients in the bladder side as well as the assays which you are using on the gastric side, the IHC as well as the ctDNA, is it similar or it needs tweaking, how you are thinking of the thresholds there?

[Dr. Helen Collins:]

That’s a good question. So, you are right. For gastric cancer, we have two ways to identify patients, both the IHC on the tissue and then the ctDNA looking for amplification. In bladder cancer, we actually presented this data. What you see in bladder cancer is just the overexpression and not the amplification. So, you do need to -- you can only use, if you will, the IHC. And what we’ve found, and I think it’s supported by a little bit of literature as well is about 13% of patients with metastatic bladder cancer are positive for FGFR2b by IHC. And so, we are finding those patients and we’re enrolling. As you may also know, bladder cancer is a little bit slower, natural progression in terms of their disease. So, it does take longer to see a signal and so we have not presented that data yet. And I am afraid we haven’t said how many patients enrolled. But we are still enrolling…

[Chris Shibutani:]

Are you targeting any specific scientific meeting for the presentation of the bladder data? Is there any upcoming meeting that you think would be appropriate?

[Dr. Helen Collins:]

Not, not yet, we haven’t. No.

[Chris Shibutani:]

Okay. And one, just one last question on just the TIM-3 partnership with Bristol. So, Aron, if you could tell us like in terms of how did you guys come across the checkpoint inhibitors with TIM-3? Because others are looking at it, there are some in Phase 1 trials, but if you could help us how you decided in all the other checkpoint inhibitors in terms of selection of TIM-3? And also the second thing is in terms of how is there anything specific about the molecule we should we aware of that could potentially be different mechanistically differentiate in some way than the molecules that are out there?

[Aron Knickerbocker:]

Sure. So, that antibody program arose from an ongoing collaboration that we have with BMS. And that’s focused on three immune checkpoint pathways, TIM-3 being one of those, but there are two others that have not been disclosed. And each pathway can have more than one target for instance. So, it’s a abroad program and it’s a very active and open collaboration between us and BMS. We and they were interested in TIM-3 at the time we initiated the program. And while I can’t go into the specifics because that’s confidential information of the parties, I can say that we were instrumental in helping BMS select the antibody to TIM-3 and not all antibodies to TIM-3 are the same. So that was certainly a key contribution by Five Prime. But, I can’t go into exactly what we did and how we did it. But just to remind you, we are eligible for significant payments associated with that program and others that emerge from the collaboration. So, in total, between the IND filing and future or potential milestone payments for development and regulatory events that could total up to $300 million per target. And then, the royalties are in the mid single digit to low double digit range. And BMS is responsible for development and commercialization and bears all the costs. So, each one of the programs that emerge from this would be a separate stream of milestone on royalty payments potentially. TIM-3 is just the first to emerge.

[Operator:]

Our next question comes from Christopher Marai of Nomura. Your line is now open.

[Christopher Marai:]

Hi. Good afternoon. Thanks for taking the questions. First question, just wondering if you could update us a little bit on thinking about the time to next cabira data, specifically with respect to the next cohorts. And how should we think about that? Should we expect that dose cohorts will drive more exploratory Phase 2 trials, like we’re seeing with pancreatic cancer? Or is work being done to bring those into potentially pivotal trials? And then, I have a follow-up. Thanks.

[Aron Knickerbocker:]

Yes. Thanks, Chris. So, we continue to collaborate very closely with partners at BMS on this program. But ultimately, the presentation of data will be at BMS’s discretion. So, I can’t tell you today when and how they’ll choose to do that. That’s up to BMS. But we are doing biomarker analyses across the multiple program --multiple tumor types in the program, not just pancreatic cancer but all the tumor types. And so, that’s very helpful for us as we try to elucidate, which tumor microenvironments are most likely to respond to this combination of cabira plus Opdivo? And how that response is characterized at the level of the tumor microenvironment? We do anticipate program updates in the second half of 2018, but data disclosure will be at BMS’s discretion.

[Christopher Marai:]

Okay, got it. And you may be alluded to this, but you’re doing biomarker analysis across tumor types. Should we think of sort of those next? I mean, you’re collaborating very closely with BMS, so they must be helping you understand the next impact for it, but should we think those next path forward include potentially exploratory Phase 2s and more biomarker enriched trials or registration-based trials of the combination? And then, just lastly, [indiscernible] with the University of Chicago on the combo of radio therapy, chemotherapy and IO agent, as well as cabira. And I just wondering if you could comment on why that’s an investigator-sponsored study rather than maybe a BMS or Five Prime-led study? Thank you.

[Dr. Helen Collins:]

So, on the biomarker part. So, I think you’re right about the biomarkers, which is that we are very -- we and BMS are very interested in looking at the biomarkers to help us really put into context responses that we’ve seen particularly not so much in pancreatic arguably, but in the other tumor types where there is some baseline response with -- we expect with PD-1. And I know you’ve heard us say this before, but of course we just finished enrolling those 6 cohorts, and so some of that is taking the time to see how many responders and how long they respond and then making that correlation with biopsy. But certainly, BMS has a great interest in being able to as much as possible identify who are the responders or who are not the responders and is there any kind of faster path to approval with the biomarker enrichment. So, that’s a big focus of our teams as they meet and talk about that as they come in. In terms of the University of Chicago IST, and I think it’s actually two with the University of Chicago. Yes, one with the radiation and then the ADVISE one. Again that’s a BMS decision. They manufacture the drug now, they have taken over the regulatory documents. And so, in terms of whether they’re doing things as an IST or not, that’s their decision.

[Aron Knickerbocker:]

But on the topic of biomarkers that other trial, the ADVISE trial is a biomarker-driven trial. So, understanding that University of Chicago will be selecting patients based on the biomarker profiles and that will determine which drugs those patients then receive in that study. But, what we know of the BMS program for IHC was that this is one of several good emerged and BMS plans to support multiple IHCs, that’s in addition to what they’re doing of course with sponsored, new sponsoring trials like the Phase 2 study and pancreatic cancer that the Japanese work that they’re doing as well to enable -- including Japanese subjects in future trials with cabira and Opdivo, and the study that we’re running on their behalf, the Phase 1a/1b trial.

[Operator:]

Thank you. And our next question comes from Jim Birchenough of Wells Fargo Securities. Your line is now open.

[Unidentified Analyst:]

Good afternoon. It’s Nick [ph] in for Jim. Thanks for taking our questions. First on bema, Phase 3 FIGHT trial. Can you talk about the design of the Phase 3 portion and potentially the timing? And obviously understand that Zai could be a very big contributor to that study. So, do you see a limiting the number of patients being enrolled from China?

[Dr. Helen Collins:]

So, again, a great question. As you know, the regulations have changed in China, so that the time from submitting a CTA to being allowed to start enrolling patients is much shorter than it was historically. We have had that conversation with the U.S. regulatory agency in terms of whether there’s a concern and how many patients enroll from China and we can say there is not as long as we’re demonstrating that their backbone treatment and they’re supportive care similar. So, I think that’s one of our reasons to pick Zai as a partner. We are very confident in terms of their experience both in the management team as well as their medical management team that they have a lot of experience in U.S. as well as China. I don’t know if you want to add anything to that, Aron.

[Aron Knickerbocker:]

Well, in terms of the design that Helen is saying, it’s a gold standard. So, OS is the primary endpoint. And we powered it to detect the difference based on our discussions with regulators would be likely the basis for approval. So, we powered it to detect a difference over the 10 months approximately, OS that you see was modified FOLFOX in the frontline setting in gastric cancer and it’s powered to detect at least two months gain over that. We hope to do better than that. We also don’t know though how the control arm will do because as I mentioned, FGFR2b overexpression or FGFR2 gene amplification, either those states was a negative prognostic factor. So, it’s possible that the patients and the controller arm would not live as long as those typically receive modified FOLFOX in the front line. But the study is powered conservatively to detect that difference. And we have the diagnostic assays in place for global implementation, both for the IHC and for the ctDNA tests. So, we’re poised to begin that as soon as we select the dose to give in combination with FOLFOX, we’ll go right into the global randomized portion. And again, we are guiding to mid this year, for Phase 3 start.

[Unidentified Analyst:]

Thanks, and in terms of the assays there, Helen, are those going to be read centrally or to [indiscernible] locally to do the analyses?

[Dr. Helen Collins:]

They’re central.

[Unidentified Analyst:]

Great. And then, in terms of the PVNS trial, I noticed you say it’s very flexible for redosing. So, what do you mean by flexible for redosing?

[Dr. Helen Collins:]

Yes. So, again, this is a non-malignant. It’s a tumor but it’s a non-malignant tumor, meaning it doesn’t have the risk of spreading elsewhere and killing the patient. So, one of the things to take care patients is to be kind of disease where you say better to get to the right place slowly than the wrong place quickly. So, as opposed to a cancer treatment where you really need to guide it aggressively because you now only get one option -- one try at it. What’s clear from again, looking at our first 30 patients, is that patients are as we said, were responding but not tolerating the therapy due to things like periorbital edema which is not something in general that a patient with fatal cancer would discontinue therapy for. And our investigators were ones that gave us the feedback of saying that potentially they were seeing responses symptomatically after just one dose. And so, based on their feedback, the idea is to give that drug less frequently than every two weeks. And then, again, we don’t know how much less frequently? So the idea is that they get it, the first dose every -- essentially every four weeks, and then making adjust accordingly. So, a patient perhaps who’s tolerating it very well, but not responding it well, they could shorten the interval a patient who is having potential toxicity can take a break and resume therapy. And our thought is this is the way a drug like this would be used in real life kind of use analogy, it’s a good one of high blood pressure medication. You don’t just automatically give any patient the full dose, you start with a low dose check the blood pressure. And depending on how they’re tolerating it and the reading of the blood pressure, you then adjust the dose. So non-malignant diseases are treated very quickly.

[Unidentified Analyst:]

Okay, thank you. And then last one for me. On the ADVISE trial, I know you mentioned that trial earlier. Do you know what the criterion or criteria are there Bristol will use to select cabira as the combination partner for Opdivo?

[Aron Knickerbocker:]

Yes. I think we’ll have to refer you to Bristol-Myers Squibb’s and set the study they’re supporting and we’re not involved.

[Operator:]

Thank you. And our next question comes from Daniel [ph] of Guggenheim Securities. Your line is now open.

[Unidentified Analyst:]

Hey, I have two questions. One on your TIM-3 antibody. Just how you think about this antibody? Would this be an antibody actually that could be used to infuse de novo immuno responses? So, could it be used to turn cold tumors into hot tumors? And then, going back to cabira plus Opdivo in pancreatic cancer or in other tumor indications actually. Are you concerned about MDSC [ph] influx into the tumor up in CSF-R1 blockade? I’m just asking this question, because the recent article in cancer cell [indiscernible]. Thank you.

[Aron Knickerbocker:]

Okay. TIM-3 is T-cell target. So, by drugging it with an antibody, I think you need some degree of hotness, i.e. T-cell infiltration into the tumor preexisting. So, I don’t know it would necessarily turn cold tumors hot. But, that’s not really -- the focus here is to activate T-cells that are present. And then you are asking about the recent publication in cell, is that right?

[Unidentified Analyst:]

Correct.

[Aron Knickerbocker:]

For anti-CSF-1R. Yes. So, we’re familiar with that paper, we’ve read it. We don’t think you can draw a conclusion about the CSF-1R blockade in human patients from that particular paper. The models that were used were kind of an unusual mouse models of disease and the CSF-1R surrogates that were selected probably aren’t ideal for what you want to use to reduce TAMS. So, we don’t necessarily see it as reading on cabira. And that model in particular has high baseline neutrophil counts and that doesn’t resemble human tumors that we’re aware of. The inhibitor that was used was a small molecule inhibitor, it also had [indiscernible] and it was dosed beginning one day after the tumor was an inoculated, so that’s basically prophylactic dosing. Again, we don’t see that as analogous, in the models, the kinetics or TAM in that paper, the TAM depletion was much slower than what we see. So, we don’t think it reads on cabira, but nonetheless, it’s interesting and we’re monitoring the literature and thank you for pointing it out in this question. But, yes, we saw it and read it, and we are as confident in cabira as we have been all along.

[Operator:]

[Operator instructions] Our next question comes from Michael Schmidt of Leerink. Your line is now open.

[Michael Schmidt:]

Hey, guys, thanks for taking my questions. I just had a couple on FPA144. I know that the initial indication is -- development is focused on FGFR2 positive gastric cancer, but just wondering if you could provide some more information on how enrollment is going in the bladder cancer cohort, whether we will see some data from that cohort this year and if you have any plans to also test the drug in [indiscernible] carcinoma where we know that FGFR2 is the driver as well?

[Dr. Helen Collins:]

Hi, Michael. This is Helen. So, yes, we haven’t guided as to when we’re going to present the data. We are enrolling bladder cancer patients. You may recall the trial was initially geared all to gastric. So, some of the delay in enrollment was because we had to find bladder sites, the gastric cancer doctors didn’t seen any of that. But we haven’t said when we’re going to present that data. And we certainly are looking actively and across many tumor types to determine what might be the next best tumor to go into, [indiscernible] is on that list. And again, we haven’t said anything more at this time.

[Operator:]

Thank you. And our next question comes from Ian Somaiya of BMO. Your line is now open.

[Unidentified Analyst:]

Hey Aron, hey Heather, it’s Goldwin [ph] speaking for Ian. Just two questions. First one on cabira. I was just wondering, a lot of conversation hear about the mechanism, its role in PVNS and oncology. And I was wondering if you could maybe shed some light as to how IL-34 could maybe be differentiating in terms of its role on TAMS, or at least it’s differentiating aspect from the competitor landscape for CSF-1Rs.

[Aron Knickerbocker:]

We selected our antibody, we selected from a panel of antibodies that were generated to CSF-1R for blockade of the epitope to which both IL-34 and CSF-1 bind. So cabira does prevent each of the two ligands for this receptor from binding thereby turning out signaling. And as you probably know, macrophages required constitute activation of this receptor by ligand binding to stay activated and proliferate. So it’s a way to deplete TAMS if you can turn off the ligand based signaling which cabira does. Not all antibodies to CSF-1R behave in7 the same way. And for an antibody for example, it only targets CSF-1 you’ll be missing that second ligand receptor interaction caused by IL-34 and CSF-1R. That said, there isn’t a lot of information on IL-34’s role in TAMS that we’re aware of. But, if IL-34 is important, then, we will block its signaling to CSF-1R in the microenvironment and the TAMS that are there.

[Dr. Helen Collins:]

Only thing I’ll add is I do you know, some of the other companies presented their data and not shown similar. And we don’t know that they have measured it, and again, we can’t speak well for the others’ molecules. So that’s part of your question.

[Unidentified Analyst:]

Yes. Thank you. And then, my second follow-up on FPA144. Are there any differences in prognosis for the FGFR2b overexpressed versus just one that have gene amplification, if I’m correct, the trial is enrolling either or, or both? But I’m just wondering in terms of if there is anything different than prognosis just for one or the other? And then, is there any chance that we might see data from the safety Phase 1 portion in mid-2018? If so, what kind of scenario would that be?

[Dr. Helen Collins:]

So, for the prognosis, the data that it’s a poor prognosis came from two different groups, one that used FGFR IHC and one that used FGFR2 amplification. But they’re not then compared head-to-head as far as I know of. So, they’re both independently have been shown to be associated with poor prognosis. And what was your second question? I forgot.

[Aron Knickerbocker:]

So the data from the Phase 1. It’s not a plan to present those data -- we’re not actually requiring FGFR2b positivity in the patients taking part in Phase 1. So, we don’t know that they necessarily have the target overexpressed. It’s also not even restricted to gastric cancer. So, we’re including any tumor type that gets modified FOLFOX, so patients could have gastric, they could have pancreatic, they could colon cancer. So, we don’t have an expectation that there would be a signal coming out of Phase 1; we’re not looking for that. What we’re looking to establish is a safe dose to give in combination with modified FOLFOX and then go right into Phase 3. So, other than for a safety, from a safety perspective, the Phase 1 isn’t meant to be informative or show efficacy.

[Unidentified Analyst:]

Thank you. And then, in terms of the Phase 3 portion, can you help us just clarify what is the bar to be in terms of whether it’s OR, OS that we should be looking for?

[Dr. Helen Collins:]

So, for the Phase 3, we have a survival endpoint. And again, as far as gastric cancer, the association with ORR, PFS and OS is poor and has not been demonstrated clearly. So, we think that you need OS to get approved and that’s why we’ve made that our primary endpoint. We also think that’s what’s clinically meaningful to patients and to investigators and physicians sort of use the drug, they want the drug that’s going to improve survival, so.

[Aron Knickerbocker:]

And, I don’t if you or the earlier question, but we powered it to detect a two-month difference or more, but minimum two months difference versus the OS you’d expect from modified FOLFOX. The literature shows that to be around 10 or 11 months. And so, we’ve assumed 10 months for the sake of powering. But again, we don’t know that patients who are actually FGFR2b positive would actually have a median overall survival of 10 months. It may maybe significantly less.

[Unidentified Analyst:]

So, it sounds like this is a different case and it could be where we had a lot of a competitors [indiscernible] versus here with this subset of population, it’s just purely going to be against the placebo arm?

[Aron Knickerbocker:]

Yes, chemo plus placebo. Right.

[Dr. Helen Collins:]

Right. And I think it was -- and I realized maybe this was some of the earlier question was about drugs that have failed. I mean, and I think that’s where you’re seeing when people have taken single agent against chemotherapy. And, I think again, that’s where 144 is slightly different, it’s due to its let’s say no toxicity but minimal toxicity, certainly toxicity that doesn’t overlap with chemotherapy, it doesn’t allow us to chemotherapy plus this drug. That’s not placed in others.

[Operator:]

Thank you. And ladies and gentlemen, this does conclude our question-and-answer session. I would now like to turn the call back over to Aron Knickerbocker, the Chief Executive Officer, for closing remarks.

[Aron Knickerbocker:]

Great. Well, thank you for joining us today and also for your support of Five Prime. And we look forward to updating you on future calls.

[Operator:]

Ladies and gentlemen, thank you for participating in today’s conference. This concludes the program. And you may now disconnect. Everyone, have a good day.