MacroGenics, Inc.
Q3 2017 Earnings Call Transcript

Published: 9 Nov 2017

[Operator:]

Good afternoon. We will begin the MacroGenics' 2017 Third Quarter Conference Call in just a moment. All participants are in a listen-only mode at the moment, and we will conduct a question-and-answer session at the conclusion of the call. At this point, I'll turn the call over to Jim Karrels, Senior Vice President and Chief Financial Officer of MacroGenics.

[Jim Karrels:]

Thank you, operator. Good afternoon and welcome to MacroGenics' conference call to discuss our third quarter financial and operational results. For anyone who has not had the chance to review our results, we issued a press release this afternoon outlining today's announcements, which is available under the Investors tab on our website at www.macrogenics.com. You can also listen to this conference call via webcast on our website; where it will be archived for 30 days beginning approximately two hours after the call is completed. I would like to alert listeners that today's discussion will include statements about the company's future expectations, plans and prospects that constitute forward-looking statements for purposes of the Safe Harbor provision under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our annual, quarterly and current reports filed with the SEC. In addition, any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views change except to the extent required by applicable law. And now, I'd like to turn the call over to Dr. Scott Koenig, MacroGenics' President and Chief Executive Officer.

[Scott Koenig:]

Thank you, Jim. I like to welcome everyone participating via conference call and webcast today. Thank you for joining us. The third quarter of 2017 was one of continued clinical progress and most recently an exciting new collaboration. We presented encouraging Phase 1 flotetuzumab data at ESMO, enrolled the first patient in the Phase 1 trial of MGD013, submitted an IND application for MGD014 and executed a global collaboration and licensing agreement for MGA012 with Incyte, which we expect we'll close in the fourth quarter. We will be sharing more data on our various PD-1 based programs at the Society for Immunotherapy of Cancer or SITC later this week and we'll have two posters and an oral presentation on flotetuzumab at the American Society for Hematology meeting or ASH in December. I'll discuss the MGA012 licensing deal in greater detail and provide an overview of all our programs after Jim has reviewed the financial results for the quarter. I will now turn the call back over to Jim.

[Jim Karrels:]

Thanks, Scott. This after we reported financial results generally in line with expectations. As described in our release MicroGenics had R&D expenses of $41 million for the quarter ended September 30, 2017, compared to $30.3 million for the quarter ended September 30, 2016. This increase was primarily due to the initiation of the MGA012 Phase 1 study and continued enrollment in multiple ongoing clinical trials. We had G&A expenses of $8.4 million for the quarter ended September 30, 2017, compared to $7.2 million for the quarter ended September 30, 2016. This increase was primarily due to increased professional fees including consulting expenses and increased employee compensation and benefit expense to support our overall growth. On the revenue side, we recorded total revenues consisting primarily of revenues from collaborative agreements of $1.7 million for the quarter ended September 30, 2017, compared to $3.3 million for the quarter ended September 30, 2016. Revenue from collaborative agreements includes the recognition of deferred revenue from payments received in previous periods, as well as payments received during the period. Revenue recorded during the third quarter of 2017 does not include the $150 million we anticipate receiving from Incyte as an upfront payment for the recently announced MGA012 collaboration. We anticipate receiving such amount upon closing the transaction in the fourth quarter of 2017 and expect to recognize the full $150 million in the fourth quarter of this year. For the quarter ended September 30, 2017 we had a net loss of $47 million compared to a net loss of $33.8 million for the quarter ended September 30, 2016. Our cash, cash equivalents and marketable securities as of September 30, 2017 totaled $203.6 million, which compares with $285 million as of December 31, 2016. Before including the anticipated $150 million upfront payment from Incyte and based on our current operating plan, we believe that our cash, cash equivalents and marketable securities combined with anticipated revenue under our existing collaborations fund our operations into 2019. Obviously, we believe the $150 million from Incyte once received will stand our cash run rate, but we will defer providing specific guidance until after we've closed the transaction, as well as finalized our multi-year operating budget later this year. And now I'll hand the call back to Scott.

[Scott Koenig:]

Thank you, Jim. As I mentioned in the opening, we recently announced the global collaboration and licensing agreement with Incyte for MGA012, which targets PD-1 and is one of the three programs within our PD-1 directed immune-oncology franchise. Through this agreement Incyte has obtained exclusive worldwide rights for the development and commercialization of MGA012, while we retain the right to develop our pipeline assets in combination with MGA012. We believe that MGA012 will remain a core strategic asset and be the basis for potential combination therapy with several molecules in our pipeline including our T-cell redirected DART molecules namely flotetuzumab and MGD007 and MGD009, as well as margetuximab and enoblituzumab. We plan to initiate the first study of MGA012 in combination with one of these internal programs by the year-end 2017. As monotherapy, MGA012 is currently being evaluated for safety and tolerability across four solid tumor types. Enrollment in the dose escalation portion of the Phase 1 study of MGA012 is complete and the results will be the subject of a poster presentation at this week's SITC Meeting. In exchange for worldwide rights Incyte will pay MicroGenics $150 million upfront upon deal close. MicroGenics will also be eligible to receive potential milestone payment of up to $750 million and tiered royalties of 15% to 24% assuming approval and commercialization. We've also have the right to manufacture a portion of both company's global MGA012 clinical and commercial supply need. We will fulfill these needs using both our existing and future GMP manufacturing suites the ladder of which is under construction and we believe on track to be operation in 2018. We believe that the strategic collaboration with Incyte will expand and accelerate the development efforts for MGA012. MGA012 is the first in our franchise of PD-1 directed candidates. Let me now provide an update on our other PD-1 based programs, which rely upon the same specificity as MGA012 for the PD-1 variable regions knowing that we can address any additional details related to the collaboration and licensing agreement in the Q&A session. We believe that MGD013 is the first bispecific checkpoint blockade molecule in the industry to enter the clinic. It is now actively proceeding to dose escalation. We are developing MGD013 and FC-bearing DART molecule to provide co-blockade of PD-1 and LAG-3. Two immune checkpoint molecules expressed on T-cells for the potential treatment of a range of malignancies. We will present preclinical data, as well as the trials in progress poster describing our Phase 1 study at SITC. MGD019 is a preclinical DART molecule candidate we're introducing at SITC. This product candidate is also designed to provide co-blockade of two immune checkpoint molecules expressed on T-cells in this case PD-1 and CPLA-4. We are conducting activities to support the potential submission of an IND application for MGD019 in 2018. MicroGenics has also made important advancements with our flotetuzumab program. Our DART molecule that recognizes both CD123 and CD3, which is being developed for the treatment of acute myeloid leukemia or AML and myelodysplastic syndrome or MDS. At ASMO in early September, we showed that flotetuzumab demonstrated acceptable tolerability in the dose escalation portion of a Phase 1 study with encouraging initial anti-leukemic activity observed in AML patients. As of the data cut update of August 1st of the 14 response evaluable patients treated at the threshold dose, 6 or 43% experienced an objective response. This included four patients or 28% who achieved a CR/CRi with one patient who had a molecular CR. We and our partner Servier continuing to enroll the expansion cohorts for the study including a 24 patient AML cohort and a 24 patient MDS cohort in the U.S. and Europe. Updated things on flotetuzumab data will be featured in three presentations at ASH in December including an oral session as well as a poster that provides the rationale for combining flotetuzumab and MGA012. I'll now provide an update on our B7-H3 franchise. Our most advanced candidate enoblituzumab and Fc-optimized monoclonal antibody that targets B7-H3. We and our collaborators continue to recruit patients in multiple ongoing studies in enoblituzumab. These studies include a combination study with an anti-PD-1 antibody and a neoadjuvant prostate cancer study. We continue to believe that by the end of the year we'll near completion of enrollments in the PD-1 combination study, which is evaluating the combination in four different indications and be in a good position to provide a clinical update in the first half of 2018. The second clinical candidate in our B7-H3 franchise is MGD009, a DART molecule that recognizes B7-H3 and CD3 and is being evaluated in a Phase 1 study in patients across several different solid tumor types. We continue to explore the dosing schedule for MGD009 administration. The third candidate in our B7-H3 franchise is MGC018, an ant- B7-H3 antibody drug conjugate that has shown potent anti-tumor activity in vitro animal models. We are conducting activity to support the potential submission of an IND application for MGC018 in 2018. Two additional DART molecules in the clinic include MGD007, which recognizes gpA33 and CD3 and MGD014, which recognizes the HIV envelope protein and CD3. We've completed dose escalation of the Phase 1 study of MGD007 and are evaluating various expansion cohorts to further refine the recommended dosing schedule of this molecule. Our IND submission for MGD014 was cleared by the FDA and we anticipate that our first patient will be dosed in early 2018. Finally, margetuximab is our Fc-optimized monoclonal antibody that targets the human epidermal growth factor receptor two or HER2. We are actively enrolling patients with metastatic HER2 positive breast cancer in the pivotal Phase 3 SOPHIA study of margetuximab in which we're evaluating the efficacy of margetuximab post chemotherapy as compared to trastuzumab post chemotherapy, following progression at the previous therapy. Enrollment for the study which will include approximately 530 patients across trial sites in North America, Europe, and Asia remains on track. We expect to complete and announce the results of an interim futility analysis by year-end 2017 or early 2018 and then complete enrollment of the study by late 2018. In addition, we continue to enroll patients in a Phase 2 gastric cancer study that will assess the combination of margetuximab within anti-PD-1 antibody for patients with advanced HER2 positive gastric cancer. We expect to complete the enrollment of two 30 patient expansion cohorts in 2017 and present clinical data during the first half of 2018. The combination of margetuximab and anti-PD-1 has the potential to provide these patients with limited treatment options with a chemotherapy free treatment option. We continue to advance our diverse portfolio of clinical product candidates are in a strong financial position that we expect to further strengthen upon closing the deal with Incyte and have entered an important agreement that will expand and accelerate the development of MGA012. We look forward to continuing to update you on the company and our programs as we continue to advance our molecules and execute on our strategy. This concludes my prepared comments. And we'd now be glad to address any questions that callers may have. Operator?

[Operator:]

[Operator Instructions] The first question comes from Christopher Marai with Nomura. You may begin.

[Christopher Marai:]

Hi, good afternoon. Thanks for taking the question. First just maybe to touch upon 007, I was wondering if you could help us to understand if some of those expansion cohorts in colorectal might include the combination with your anti-PD-1. And then secondarily, if you could elaborate a little on how you might choose combo the anti-PD-1 with next candidate going forward? Specifically, maybe a little bit of the rational or data behind doing that with the CD123 targeted bispecific DART? Thank you.

[Scott Koenig:]

Thanks very much, Chris. So, with regard to MGD007 just refreshing memory this is a molecule targeting gpA33 and CD3 the target expressed on a GI tract and on colorectal cancer. As we had pointed out at our R&D Day late last year, we were seeing on target effects of the drug, but were challenged by effects on the target on the normal GI tract. And so, over the course of the past year we have been designing ways of providing additional support care, as well as doing dose modification. One of these involved the delivery of budesonide to provide a topical steroid for the normal GI tract as the drug was able to bind to tumor at metastatic site. Using this plus a combination of reduction of dosing, initially we were dosing at 1 mg per kg on a Q2 weekly basis, we've now looked at two other dosing regimens including the concept to using a leading dosing on a Q2 weekly basis, as well as dosing on Q weekly basis. What I can say is that we have been very satisfied with the progress we've made here, and the drug seems to be much better tolerated by the patients. Right now, we've completed on both analysis and we're expanding on several of these cohorts to test the drug in additional patients as monotherapy. And then we are planning to combine this with MGA012 likely starting next year. We should be able to provide an update at one of the oncology conferences either AACR or ASCO in 2018. Could you repeat your question, I didn't hear the second question, Chris, was regarding 123? Are you there?

[Operator:]

And it looks like Chris is no longer connected. Our next question comes from Peter Lawson with SunTrust Robinson Humphrey. You may begin.

[Peter Lawson:]

Hey, Scott. Just I guess thinking about the SITC data, is there anything you can give us around tumor types with C, anything around - for the 012 that is and then kind of, I guess we've seen in the abstract that was response to the ovarian cancer, you thinking that could suggest the broader utility of the drug? So, anything around tumor types and then how you think about the eventual utility of this drug?

[Scott Koenig:]

Yes, thanks Peter. So, as noted we have five abstracts that are submitted or posters that will be presented at SITC, two related to MGA012 the PD-1 molecule, two related to the DAR bispecific PD-1 by LAG-3, and one an introduction of preclinical data on first DART molecule targeting PD-1 and CTLA-4. With regard to the data that's going to be shown for MGA012, we're going to show the dose escalation, which were essentially all comers of tumors and the establishment of the dosing obviously the PK and PD associated with occupancy data and evidence of the objective responses in various Tumor types. We have started already the expansion as monotherapy in four distinct tumor types and that will be revealed at the time of SITC poster. But, of course that data is just too early to discuss at this time.

[Peter Lawson:]

Thank you. And then just thinking about that Incyte payment, I didn't get that, is it - just does it just once in the P&L in Q4, or does it get spread out over a longer period of time?

[Jim Karrels:]

Yes, the $150 million, we expect to receive in the fourth quarter upon closing of the deal. And our current thinking is that it would all hit the P&L as revenue during the fourth quarter.

[Operator:]

Thank you. Our next question comes from Yigal Nochomovitz with Citigroup. You may begin.

[Yigal Nochomovitz:]

Hi, Scott and Jim. Thanks for taking the questions. Could you spend a few minutes discussing the sort of how you see the target product profiles for 013 and 019? I know it's early days still, but they are similar in some respect obviously through the PD-1 anchor, but is there anything you can say about how you see them positioned differently in the market for CTLA-4 versus LAG-3 at this point? Thanks.

[Scott Koenig:]

Thanks very much, Yigal for the question. So, with regard to both molecules as you know, first of all, they both have gone through a thorough preclinical toxicology in different studies. MGG013 a PD-1 by LAG-3 is now in dose escalation in patients. As we view this molecule, particularly given a very substantial database now in a various model systems, and the expression pattern of LAG-3 on normal patients. We think this typical molecule is going to be very exciting because, number one is from previous study it seems that the engagement of blockade of LAG-3 may increase or restore sensitivity to PD-1 in patients that have become refractory to PD-1. And in fact, in some of the tumor model as has been shown is that even in the expression of other checkpoint molecules such as TIM-3 [ph], the blockade of LAG-3 is sufficient to restoring this activity and providing significant enhance T-cell effects and anti-tumor responses. And given now the very recent data at ASMO that Bristol-Myers has disclosed with regard to the PD-1 and PDR-1 refractory melanoma populations in which they are seeing first clinical benefit in patients who have a LAG-3 expression rate at 1% or greater. And in the absence of any real significant uptick in their toxicology profile, we think that this will be very attractive. First obviously in going - in various solid tumors that express PDR-1 and PD-1 that are refractory to standard PD-1 or PDR-1 blockade and that will open up great opportunities and I think a very good template for regulatory approval assume obviously the success and safety is consistent with what Bristol has seen with the two individual molecules. Of course, we will look at this as an opportunity to also treat patients who have been not naïve to either PD-1 and PDR-1 therapy. And then finally the ability of now combining this DART molecule bispecific in combination with other molecules in our portfolio specifically the redirected T-cell DART molecule, as well as Fc enhance molecules is possible as we further advance this molecule. Now with regard to MGDO19, PD-1 by CTLA-4, we've been very encouraged by the toxicology study that were conducted in primate and we have been able to dose this molecule, which is designed to attach to bispecific molecule with two binding sites specifically for PD-1, and two binding sites for CTLA-4. And we are seeing biological effects with extension of T-cells quite significantly. And with a safety profile that seems to be better than what have been previously published by Bristol-Myers when they did Yervoy and PD-1 studies in primate. So, obviously we will see how that pans outs as we move this forward into clinical development, but right now we are excited about the potential prospect for this molecule as well.

[Yigal Nochomovitz:]

Okay, thanks. On B7-H3, do you have any updated thoughts on how you are positioning this portfolio? Are you advancing all three with the hope for potential of thinking about the market or is the goal here or strategy to find one that's the best one and that's the one you are going advance into late stage studies?

[Scott Koenig:]

Thanks for that questions about B7-H3, we are very optimistic about the prospects of our whole B7-H3 franchise. Obviously the one that's furthest along is enoblituzumab, which is currently completing studies in combination with anit-PD-1 in four different tumor types head and neck, lung, melanoma and bladder cancer. And we expect to be able to provide updates of that data early next year. In addition, we are finishing off an investigator sponsor trial using enoblituzumab as a single agent in prostate cancer in patients with newly diagnosed prostate cancer with high grade scores of - recent scores of seven or greater. We are closing in on finishing enrollment in that study and expect to be able to provide update next year on use of that in that indication as well. With regards to the MGD009, which is our CD3 B7-H3 DART molecule, we're completing out the dosing right now of monotherapy. As we have pointed out last year we were beginning to see anti-tumor effects, but this was associated in some of the patients with cytokines release. And as a result, we wanted to modify the dosing schedule taking some of the lessons learned from the flotetuzumab story including leading dosing and variation of the dosing regimen. And we expect that to be completed sometime earlier in 2018. And then we will bifurcate the development of that in as monotherapy in six different tumor types approximately 16 patients each, and then in combination with MGA021 our anti-PD-1 molecule. And then finally we've recently completed the toxicology studies of MGC018, which is an antibody with a linker toxin conjugate. Now the epitope that's recognized by MGC018 differs from that of MGD009 and differs from that of enoblituzumab. And in fact, they're non-competitive and can be used in combination at least in theory. So back to your original question do we see this as being developed as winner of one of the three or two of the three or do we see this as separate molecule? As we pointed out quite extensively in the past we're fairly agnostic we want to find the right treatments and the right conditions depending on the tumor type in stage of the disease. So, I can imagine that if the responses were quite favorable in particular tumors, we could in fact advance all these molecules, but this will be determined by future studies, which we expect to complete during 2018.

[Yigal Nochomovitz:]

Alright, that was great. And then on flotetuzumab, is my understanding correct that you're happy with what you've achieved in the dose escalation given the data presented at ASMO? Or do you think that you still can get better target engagement with the other higher dose?

[Scott Koenig:]

So, yes, thanks for that question about flotetuzumab. So obviously, we were very excited about the prospects of actually taking patients that had very poor cytogenetic profiles and that were particularly refractory to previous chemotherapy regimens that were now responding with the both objective responses in some of these patients with CRs. Of course, we have to expand the dataset to show the consistency of the data. We felt that the safety and efficacy profile as currently designed right now, in which patients initially get 30 nanograms in the first four days and then switch for few days on a 100 nanogram and then geared up to 500 nanograms per kg over the course of the next three weeks for the first month. And then a four day on, three day off regimen if they show evidence of anti-tumor effects at time of the completion of the first cycle of treatment. Now we'll see what the data shows us on the additional expansion cohorts. Currently we're enrolling 24 additional patients with the same relapse refractory AML in 24 patients with NDA and then getting the new regimen. And then we have the opportunity to fine tune that dosing regimen as you point out, if we think that we can achieve even better therapeutic benefits. I should also point out at the ASH Meeting in addition to the update on the current study with some additional patients added in the interim, which will be discussed in an oral presentation. We have two poster sessions at ASH. And I'll point you out which I think will be quite relevant of the rational of combining this with MGA012 or our anti PD-1 molecule, based on data that we glean from the current study. So, there are great opportunities to add on additional responses at least in theory using combination drugs.

[Operator:]

Thank you. Our next question comes from Dane Leone with BTIG. You may begin.

[Dane Leone:]

Hi, thanks guys, thanks for the update. I want to ask on, still sticking with flotetuzumab, when we see the update at ASH, how do you think the dataset as it's maturing, can provide a couple of different rats [ph] to regulatory development and kind of what clinicians want to see. And I guess, if I could nuance that a little bit. How are you thinking about the algorithm of the actual dosing and treatment of flotetuzumab as patients stay on the drug for longer periods of time? Do you see longer intervals or something like that? And maybe just kind of remind us of that plan. Thanks.

[Scott Koenig:]

Hey, thanks Dane. So, again, we expect that given that there is very few options for patients particularly with refractory disease and relapsed refractory that if the dataset looks promising with the additional patients that we're enrolling now that that would provide an opportunity for us to have a discussion with the regulatory agencies for designing a pivotal study. And whether this can be a single arm study or a control study, one can make the argument based on the data from Agios on the IDH2 where they saw a CRh rate of 23% with obviously some reasonably persistent therapeutic benefits, and that was designed as a one arm study that that design maybe an option for us. But of course, it will all be dependent on what the additional data shows and the feedback from the regulatory agencies. With regard to what clinicians want to see, what I can tell you is this that we are hearing very positive feedback from the KOLs and physicians are using a drug who have reviewed the data. We're actually expanding the number of sites, we currently have 11 sites that are enrolling patients; we're expanding number of sites in the near future. And we've been encouraged by a number of these investigators to expand the use of this drug beyond the relapsed/refractory AML population to look at earlier stage AML patients both fit and unfit populations and then other diseases in which CD123 is over expressed. So, we're in discussions on pathways forward with that and we expect we'll be able to update you sometime in the near future.

[Dane Leone:]

Thank you. And if I could just ask one more on MGD009, cloud you just kind of provide timeline that you are thinking about? I guess, maybe I could just ask how enrollment is going in your view? How the dose escalations are going and kind of timeline for some data on that one heading into 2018?

[Scott Koenig:]

Yes. I would say that it is a little slower than I always - that I wanted it to achieve as the CEO, you're always finding that you want things going faster. I was hoping that we would've had the dose defined by this time, I think that we should have it defined early in '18. And then we will quickly then expand into those expansion cohorts that I described before the six expansion cohorts in 16 patients each. And then the combination study with MGA012, my expectation is both of those studies would likely to start in the first half of '18 and as I alluded to before we probably be able to provide an update on the dose escalation partner defining the dose at one of the scientific conferencing in the first half of '18.

[Dane Leone:]

Great, thank you very much for the update.

[Operator:]

Thank you. Our next question comes from Michael Schmidt with Leerink Partners. You may begin.

[Michael Schmidt:]

Hey guys, thanks for taking my questions. Just a couple, number one on the margetuximab interim analysis remind me how many events is triggering that analysis in the study?

[Scott Koenig:]

So, Michael we have not disclosed that, and we are not right now planning to discuss that. We have obviously a preset plan empowering that what we have decided upon we are close to achieving those number of events, but we have not reach them yet. We still believe that this will occur by December. And as was indicated earlier depending on obviously the data safety monitoring broad timing we would be able to get the analysis and feedback either late December or into January. So that's the plan right now.

[Michael Schmidt:]

All right, great. And then on the - I thank, you said the gastric cancer came through the combination study will ramp up in the first half of next year and I am just wondering just to help us gauge how the profile fits in the current treatment paradigm, I guess, in gastric what is the bar here for in terms of efficacy what's a good enough signal to move this forward into additional studies in gastric?

[Scott Koenig:]

Great question. So, we have - just remember to refresh your memory this is an open label study and second on gastric cancer release patients have seen herceptin and came out. And we are looking at providing - this is an open label study, so these are patients that are HER2 positive either gene amplified or IHC, +2 or 3+. And we finish the enrollment of the 30 patients in the U.S. and we are about to complete the enrollment of the full 30 patients in Asia. Where we expect to provide update is just to give you little more granularity is likely at the ASCO GI Meeting at the end of January. So just to give you a historical perspective, if you look back at our Phase 1 data of this type patients with gastric cancer treated with margetuximab alone as monotherapy small number of patients. We were seeing responses approximately in the mid-teens in this population. And if you look at the data that Merck received approval on for KEYTRUDA and this was the third line as a single agent, their objective response rate was about 13% in that population. So, all told if you think that you are having additional benefit my assumption is that you would like to see something at least in 20 something range of objective responses or higher to make a rational decision to move ahead there.

[Michael Schmidt:]

Great. And then just for context the second line gastric, is the current set of cares in chemotherapy and how to HER2 patients or (inaudible)?

[Scott Koenig:]

I didn't hear your question can you say that one more time?

[Michael Schmidt:]

What is the current center of care in those types of patients?

[Scott Koenig:]

Yes, it's ramucirumab plus chemotherapy at second line right now.

[Michael Schmidt:]

And the efficacy level for that combination what's that?

[Scott Koenig:]

I don't have this specific numbers from the trial, so I don't want to misquote it. But rather not state the actual numbers there. But I think that in the numbers I'm driving at with regard to a chemo-free regimen this would be very competitive. And certainly, obviously it will also depend on the persistence of the response. As I recall the length of time to those patients advance their disease was not very long. But I don't have the specific numbers yet.

[Michael Schmidt:]

And then just to clarify the data at ASCO GI will that be on both of the extension cohorts or will it be on all of the patients or will be a cut of the data?

[Scott Koenig:]

My assumption is as I said you we're not finished fully dosing the patients to likely till December. So, I would say it would be the majority of the patients and it will be an integral look, an interim look. But I think that there should be sufficient amount of data to be able to draw some conclusions there.

[Michael Schmidt:]

Okay, perfect. Thanks for the added information.

[Operator:]

Thank you. Our next question comes from Stephen Wiley with Stifel. You may begin.

[Philomena Kamya:]

Hi, this is Philomena Kamya in for Stephen Wiley, thanks for taking our questions. If you wouldn't mind remind us again, which DART molecules you have in mind for combination trials with the MGA012 PD-1 molecule? And I have a follow-up questions.

[Scott Koenig:]

Yes, thanks, Philomena. We are planning studies that would combine MGA012 with flotetuzumab. And as I said take a look at the ASH data for the rationale there. MGD009 which is the B7-H3 by CD3 and then given the data that Roche has shown with regard to the combination of their CA-by-CD3 plus their anti-PD-1 in providing a prolonged response in patients with advanced colorectal cancer. We think that's a good rationale to combining with MGD007.

[Philomena Kamya:]

Okay. So, with respect to the flotetuzumab and 009, would you expect this combination with 012 to work better in cancers where there is enhanced differential expression of B7-H3 like in the prostate cancers?

[Scott Koenig:]

So, you said flotetuzumab and 009? I'm sorry can you repeat the question one more time, sorry.

[Philomena Kamya:]

No worry. So, in DART molecules that contain the target B7-H3, would you expect the combination of these DART molecules with anti-PD-1 to work better in cancers where there is better differential in the target expression that can…

[Scott Koenig:]

I see, what you say. So, I think that the expression pattern on B7-H3 with regards to the performance of the DART molecule. We don't have data on that, we know that even at very low expression of B7-H3 on tumors there is recognition in Kildare. Now with regard to combining that with an anti-PD-1 as long as we're able to recruit T-cells there to mediate the effect, we have shown if you recall in preclinical data that that combination was very synergistic. So, we expect that that irrespective of the density of B7-H3 on the tumor that the combination with an anti-PD-1 is likely to show improved responses. But we'll have to see.

[Philomena Kamya:]

Okay, thanks so much.

[Operator:]

Thank you. Our next question comes from David Lebowitz with Morgan Stanley. You may begin.

[David Lebowitz:]

Thank you very much for taking my question. I just had a question on B7-H3 molecule, given the experience thus far with enoblituzumab in a wide array of cancers. Are you starting to think of narrowing in on specific cancers for some of the trials going forward especially for MGD007 and MGC018?

[Scott Koenig:]

Yes, so thanks, David. So, as you know for the enoblituzumab we did that in combination studies where in the dose escalation and the extension studies we had a very wide range of tumors that we were pursuing and then we decided to narrow down to four tumor types as I noted before of lung, head and neck, melanoma and bladder cancer. We expect that depending on the individual tumors and the mechanisms that we're employing here that are quite differential, certain tumors may respond better than others. And of course, for instance with a molecule that has a linker toxin technology in which you have to have an uptake of the receptor and the complex into the cell certain tumor types intend to that better than others. So, we may see stratification ultimately and which would include a narrowing of specific tumor types we would pursue for each one of those B7-H3 targeted molecules.

[David Lebowitz:]

Thank you for that. And one more question on MGD014, you are going to start a trail early next year, could you just run us through what that trail looks like and then what you are looking to find out?

[Scott Koenig:]

Yes, thank you very much for the introduction of that. A molecule which is we've been pretty quiet about, obviously we got the clearance from the FDA to proceed with that study. This is a study of patients who are on any retroviral therapy for HIV, in which we can measure the residual latent pool of virus in cells. And so, first of all obviously dose escalation study, we're looking at the tolerability of the molecule. This study is being conducted at University of North Carolina. The - once we start this obviously the safety we will also be monitoring viral persistence and viral load in those subjects, and assays will be tested, and obviously other immune parameters will be followed. Ultimately, once that is completed, there is a plan to combine it with other molecules that can induce the virus acutely so that might make this DART molecule more effective of eliminating that latent pool of infected cells, but that is a follow-up study in the future.

[David Lebowitz:]

Thanks for taking my questions.

[Operator:]

Thank you. Our next question comes from Reni Benjamin with Raymond James. You may begin.

[Reni Benjamin:]

Hey, guys, thanks for taking the questions and congratulations on a nice deal, nice validation of the platform. Maybe just as a follow-up to a couple of the other questions asked before regarding flotetuzumab, Scott, can you provide maybe a little bit more color in terms of those patients that are responding maybe what the duration of response was? What kind of duration of response you're looking for? And in these patients, have they - are you thinking about potentially bridging to transplant, have any of them bridged to transplant or these patients just too far down that transplant, they are not transplant eligible?

[Scott Koenig:]

Ben, thanks very much for the question. We'll be providing some update on the durability of responses at ASH. So, I will not comment on it now. Obviously, a lot of the patients that were treated at the time of ASMO and even still now, are very short windows of opportunity and many of these patients are still being followed or on therapy. So, we don't have a full analysis of how persistent the responses are will be provided in a real-time basis at the time of ASH. So far, no patients have been bridged to transplant, most of these patients are at - are fairly sick and had not been - most of them had not been candidates for transplant given their circumstances. But certainly, that is one opportunity for the use of this drug, particularly as we get into patients that are eligible with transplant, would be able to provide that as an alternative for them. Of course, we'd like to see the durability of these responses without treatments for long periods of time. As you know people have looked at time intervals of 36, 60, 90 and six months data, depending on studies. And certainly, we would like to achieve it, hope to achieve the six month on longer data in these subjects.

[Reni Benjamin:]

Got it. And then just to clarify, will we be seeing any of the AML or MDS cohorts at ASH or is that something that we could expect the ASH of next year?

[Scott Koenig:]

The new patients that we're currently treating the 20 - so several of those - so we started the expansion in August. So, several of those patients will be added at the time of ASH, but only small numbers given the short timeframe. And then the plan would be then once completed in the first part of next year to provide update at a significant scientific conference.

[Reni Benjamin:]

Got it. And then just maybe a high-level question regarding anti-PD-1, will you be targeting indications for which anti-PD-1s are already approved or is there from a strategic perspective, a push to maybe look at indications for which checkpoints I have not been approved?

[Scott Koenig:]

So, as you know from the way the deal is now structured, we have four tumor types that we're pursuing right now as monotherapy, as a proof of principle. I would let you wait till the end of the week for that disclosure to occur. With regard to the actual approval strategy as a monotherapy that will be fall to Incyte to make that decision. So, stay tuned for their feedback.

[Reni Benjamin:]

Okay. And then, I guess, just one final question regarding the DART molecules. As we think about the DARTs and their side effect profile, should we be thinking that all DARTs or any DART with a CD3 sort of all created equal and have very similar profiles or really the variable region that's targeting call it a new target really brings different side effect profiles to each molecule.

[Scott Koenig:]

It's an excellent question, and a complex one. Obviously now the distribution of the particular tumor antigen with respect to its expression pattern, both on tumor tissue, but also on normal tissue in a large part will dictate part of the side effect profile. So, if you in fact can get a tumor target and that's one of the reasons why we like B7-H3 for its fairly restricted pattern on tumors versus normal tissues. We think that most of side effect profile would be relegated to cytokine release as a monotherapy. Of course, you can expect other toxicities, if there is a binding to normal tissues, but so far, the biggest issue has been at certain doses. We do see cytokine release, which we have shown can be managed very well. We see that the magnitude of a cytokine release doesn't approach the level that has been seen for instance with CAR T therapy. Now with regard to the CD3 components, obviously there are different obstinacies and then also different epitopes of CD3, which can mediate and induce cytolytic activity. And each of those specificities or affinities may give you a different degree of cytokine release. And so, there can be some difference among molecules and the particular CD3 component that you select for your bispecific molecule.

[Reni Benjamin:]

Got it, thanks for taking the question.

[Operator:]

[Operator Instruction]. Our next question comes from David Nierengarten with Wedbush Securities. You may begin.

[David Nierengarten:]

Hey, thanks for taking the questions. I just want to any follow-up a bit on some of the details on enoblituzumab and 09, I was just curious first off how many - if you could tell us how many dose cohorts you have gone through for dosing for 009? And you mentioned of course a bit of CRS are there any other side effects that you saw specially given some of the expression on vasculature just if there was anything else popping up? Thanks

[Scott Koenig:]

So, David your question starts off with both enoblituzumab and 09, but I think most of the question is related to 009. Let me just reiterate the enoblituzumab we are dosing enoblituzumab currently at 15 mg per kg on a weekly basis. In fact, we have tremendous occupancy and we have increasing concentration in the serum of enoblituzumab in some of the patients we've looked at. And so, some of the future studies with enoblituzumab may be looking at alternative dosing regimens that are less frequent. So, let me set the stage for that. With regards to MGD009 there have been several that didn't look at, I think it's three, but don't hold me too if there is a fourth one that has been started in terms of different dosing regimens. And a lot of this is variations on a theme which is a fixed dose or then a leading dose that would be to the previous dose or to a higher dose. So, there is variation is on a theme here. But I would say in general the three different dosing regimens were pursued once we hit the 10 mg per kg dosing regimen. With respect to other toxicities, I haven't reviewed recently the safety data, but I have not been informed of anything else of a particular concern besides cytokine release, but I leave that to our clinical group to further updates you if they have additional information.

[David Nierengarten:]

Okay, thanks.

[Operator:]

Thank you. This concludes the question-and-answer session. I will now turn the call back to Dr. Koenig, for closing remarks.

[Scott Koenig:]

I would just like to thank everyone again for joining us and let you know that we look forward to update you on each of the programs that we discussed today, as we continue to make progress. Have a great rest of the day.

[Operator:]

Ladies and gentlemen this concludes today's conference. Thanks for your participation and have a wonderful day.