ALLO - NASDAQ

Hello. Thank you for standing by, and welcome to Allogene Therapeutics Second Quarter 2023 Conference Call. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be aware that today's conference is being recorded. I would now like to turn the call over to Christine Cassiano, Chief Communications Officer. Ms. Cassiano, please go ahead.

Thank you, operator, and welcome to our call. Today, after market closed, Allogene issued a press release that provides a business update and financial results for the second quarter of 2023. This press release and today's webcast are both available on our website. Following our prepared remarks, we will host a Q&A session. We ask you to limit your questions to one per person as we will keep this call to an hour and do our best to get to as many questions as possible. Joining me today are Dr. David Chang, President and Chief Executive Officer; Dr.

Thank you, Christine, and thank you for those joining the call today. During the second quarter, we presented updated Phase I data on our lead allogeneic CAR T program targeting CD19 for relapse and refractory lymphoma. We are immensely proud that our off-the-shelf product candidate has shown the ability to generate durable complete responses that by all accounts appear to be similar to approved autologous CAR T therapies. This is a significant milestone for the field and represents a great opportunity to reflect on the current state of CAR T, including the advancement of allogeneic options. To that end, I would like to focus my comments today on the allogeneic CAR T field at large. I will then ask

Thank you, David. As we have noted in previous calls, some of the biggest questions facing allogeneic CAR-T development was whether the safety and efficacy of an allogeneic product to be comparable to approved autologous CAR-T therapies and perhaps even more importantly, whether an off-the-shelf product can induce durable complete remissions. At the American Society of Clinical Oncology Annual Meeting, the European Hematology Association Congress and the International Conference on Malignant Lymphoma in Lugano, we shared long-term durability data from our Phase 1 trial that answered these very important questions and substantially reinforced that our off-the-shelf CD19 AlloCAR T product candidates demonstrate the promise in large B-cell lymphoma. At ASCO, with an Oncor presentation at EHA, we presented an updated analysis of the ALPHA and ALPHA2 trials focused on patients who received the regimen that is being deployed in our potentially pivotal Phase 2 trial. These 12 CAR-T-naive patients with relapsed/refractory LBCL received a single dose of ALLO-501 or ALLO-501A manufactured using the alloy process following a lymphodepletion regimen of FCA90, which is comprised of standard low doses of fludarabine and cyclophosphamide plus 90 milligrams of all 647. The median time from enrolment to the start of therapy was three days. And as of the April 20, 2023 data cut-off, all 12 patients were followed through a minimum of six months. 7 of 12 patients or 58% and achieved a complete response and five patients or 42% maintained a CR through month six. Of the five patients who are in CR at six months or 80% had an ongoing remission. The fifth patient had disease progression at 24 months. The median duration of response was 23.1 months with three patients remaining in remission for over 24 months and the longest remaining in remission for over 31 months. To put these data in context, our CR rate of 58% can be viewed in light of approved autologous CAR T therapy CR rates that range from 32% to 54% per label. Of course, the appeal of CAR T therapy is that complete responses can be durable. Our CR rate at month six of 42% compares favorably with autologous CAR T as their rates range from 29% to approximately 40%. At the meeting in Lugano, we presented data from all 33 patients with relapsed/refractory LBCL who received ALLO-501 or 501A made using the ALLO manufacturing process. In addition to the 12 patient data reported at ASCO, this data set included additional patients who received either lower doses of ALLO-647 and or two infusions of ALLO-501 501A faced approximately one month apart in our consolidation regimen. Across these 33 patients, 100% of patients received product per specifications no patients received bridging therapy. In these 33 patients, ACR was achieved by 14 patients or 42% of whom 10 maintained a complete response at month six. The median duration of response in these 33 patients was also 23.1 months, demonstrating that we could still achieve results within the parameters established by approved autologous CAR T therapies even using less optimized dosing. We also observed robust CAR T cell expansion and persistence in patients, particularly in responders, arguably a first for an off-the-shelf allogeneic cell product. In all presentations, our safety analysis included all 33 CART Naive LBCL patients who received ALLO product. Treatment was generally well tolerated with no incidences of Grade 3 or greater CRS and no cases of ICANs or GvHD. Cytopenias and infections were manageable and comparable to the experience with autologous CAR T therapies in patients with relapsed/refractory LBCL. We showed patients neutrophil and lymphocyte counts beginning to recover within the first month of infusion and achieving baseline levels with kinetics similar to autologous cell therapies, providing additional insight into our comparable infection rate. Our data are the first to demonstrate the potential of an allogeneic CD19 CAR T to induce durable complete remissions and set the stage for a potentially competitive profile to approved autologous CD19 CAR Ts. Our focus now turns to two important objectives for this program. The first being enrollment in the ongoing Phase 2 Alpha2 trial, where we hope to definitively establish the potential of this new modality. We are very pleased to have extended enrollment in this trial into Canada and expect to begin enrolling patients in Europe in Q3 and Australia before year-end. We also continue to focus on enrollment in our Phase 2 EXPAND trial which is designed to demonstrate the superiority of ALLO-647 containing lymphodepletion regimens over a regimen of FluCy ALLO. In parallel, we are working through a trial design strategy that could support regulatory approval in earlier line LBCL. We believe our proposed approach may be particularly advantageous and look forward to sharing more detail on this strategy by the end of the year. We believe our success to date, where others may have fallen short is attributable to our ability to support the expansion and persistence of our allogeneic CAR T cells necessary to achieve durable tumor elimination. The preponderance of data we've already presented from our CD19 program point to an improved clinical performance when they include ALLO-647, our anti-CD52 monoclonal antibody with standard low doses of FluCy. Our platform enabled by ALLO-647, permits an extended window of CAR T cell expansion and persistence. What ALLO-647 does cannot be reproduced even with high doses of chemotherapy that might be associated with severe toxicity. We are now focused on applying a rigorous approach to explore the boundaries of what works as the best practice to enrich our understanding of CAR T cell expansion and persistence as we investigate next-generation technologies, including Dagger, which is currently being utilized in our ALLO-316 anti-CD70 solid tumor trial. I will now turn the call over to Eric.

Thank you,

Thank you. [Operator Instructions] Our first question comes from the line of Tyler Van Baron with TD Cowen. Your line is now open.

Great. Good afternoon guys. Thanks very much for taking the question and congratulations, Eric, on all that you helped the company achieve during your tenure at allergy. With that said, my question is, I'd like to ask you to elaborate on the pace of enrollment in ALPHA2 and whether you've seen an increase in the pace of enrollment, especially with all the recent conference presentations.

Hi Tyler, it's

Thank you. Our next question comes from the line of Salveen Richter with Goldman Sachs. Your line is now open.

Good afternoon. This is [indiscernible] on for Salveen. Just a two-part question from us. As you clearly described in the prepared remarks, it seems like the supply situation with autologous CAR T is improving, especially with respect to BCMA CAR T. I guess in this context, how are you thinking about the competitive landscape given the ongoing optimization that's required for ALLO-715. And then in the lymphoma space, I guess, in the context of the recent data that was presented from Caribou CD19 program, which is also starting to evaluate the asset in earlier line patients. Thank you.

Yes. This is David Chang. Let me take the first question on the BCMA, and I'll ask

Yes. So, a great question about the Caribou update. Overall, we were very pleased to see another sponsor, present data supporting the use of alpha/beta T cells in an off-the-shelf allogeneic platform and driving benefit for patients. We see that this is a very validating milestone for the field. And having been at this now for five years and arguably some of the most experience in this field, we are very proud to see an additional person join this field, but we also stand very much by the data that we presented this summer as part of the overall and growing experience in off-the-shelf AlloCAR T cells.

Thank you. Our next question comes from the line of Michael Yee with Jefferies. Your line is now open.

Hey guys, thanks for the question. One of the things that comes up is the use of CAR-T after Yescarta. And since there's uncertainties about that, one could envision that your product would be an obvious fit earlier lines, particularly given off the shelf. To do that, you would need to run a second-line study. You suggested, you would give us some tidbits and some insight into how you would think about a design for that later this year. But can you just remind us, could you actually start a second-line study next year? Are there things relevant to sort of having to make progress on third line? Would you have the money to do that? Could a pharma company help you out a lot easier? Maybe just talk through the different challenges of second line, how you should think about that because I would think that's even more important than third line. Thank you.

Mike, let me take the first part of the question. You were asking all important and excellent questions. And I'll ask

Yes. Thanks, Mike, for the question. So, I think the premise of it is spot on. I think you look across CD19 and also BCMA and what we're learning is that for as powerful as these therapies are in relapsed/refractory disease, their utility in earlier lines is as compelling, if not more so. And obviously, the numbers of patients are greater there. So, we have been keenly focused on coming up with a study design in earlier lines that I think will play to our strengths and also serve an unmet need that exists in that second line. And we're not quite ready yet to share a lot of details on this study. We hope to be able to do that by the end of this year. But suffice it to say, we think that this is a great opportunity for the field and for Allogene in particular.

Thank you. Our next question comes from the line of John Newman with Canaccord.

Hi guys. Thanks for taking my question. So you mentioned that you're going to be enrolling patients in the pivotal study in Europe and Australia here, I think Europe shortly in Australia by the end of the year. I'm curious if you could talk about whether or not there's any difference in the availability of the autologous CAR-T therapies there. The reason I'm asking the question is I'm just wondering if perhaps enrolling patients in those two regions could really increase the chances that you're getting patients that would otherwise be getting autologous therapies. Thanks.

Yes. So we know that the utilization of CAR-T generally in those regions is significantly less common than it is in the United States. And obviously, we expect that overtime, that will change. And as additional pivotal data sets or come to the table and regulators begin to approve these therapies and payers get on board as well. The whole field is moving towards utilization of CAR T in third line and in second line. But these regions are significantly behind the United States. So there is, plenty of patients in both of those regions where the unmet need in third line is substantially higher than it is in the United States. So we feel that it and have felt for a long time that, it's made a lot of sense to broaden the footprint and be able to bring on those patients that are -- whose needs are not being met by current standards in those ex-US regions.

Thank you. Our next question comes from the line of Jack Allen with Baird. Your line is now open.

Great. Congratulations to the team on the progress and Eric, congratulations to you on all of your accomplishments, over the last five years. I'm going to try to do my best to put you to work on your last day here. And I wanted to talk for a second about the Servier relationship. Could you remind us maybe how things stand as it relates to Servier? And I'm seeing in the 10-K that or the 10-Q that you received very de minimis payments from Servier in the last couple of quarters here. Do you expect that those payments could be higher, as you move into the European region with the ALPHA2 study? And what's baked in as it relates to the cash flow guidance surrounding Servier and the relationship there? Thanks so much.

Jack, thank you very much for the kind, personal comments and the question, it's good to hear your voice. And I think you must have studied more French than I did in high school, because your pronunciation of Servier is spot on. We continue to have a little bit of a challenging relationship with Servier, as we've discussed previously and in our SEC filings. There are disputes over certain aspects of our collaboration. As you noted, there are disputes over cost recoveries, which we believe we're entitled to as well as our ability to opt into ex-US development in a future date, so, at this point in time rather than to delve into legal matters. So I'll just leave it to what's going to be published in our 10-Q in terms of the update. And hopefully, we'll be able to find an eligible solution going forward.

Yeah. Karina, there are multiple things that we are doing with the manufacturing process review. And as your question as I pointed out, cytokine is an important aspect of what we are reviewing without going into further details. And in terms of timeline of what we will say about our BCMA program. Let's defer that until we complete the review and decide what we will, when we will think about introducing back into the clinics.

Thank you. Our next question comes from the line of Kalpit Patel with B. Riley. Your linen is now open.

Yes. Hey. Good afternoon. Thanks for the taking the question. One more on the enrollment. Could you please comment on how many additional clinical sites you expect to include for the EXPAND trial? And is the guidance still unchanged to report data roughly around the same time from this study as with the ALPHA2 study?

Yes. Thank you for the question. So we haven't gone into exact detail on the number of sites for either ALPHA2 EXPAND. We are continuing to bring on sites in North America for EXPAND. As you know, this is a relatively newer trial than ALPHA2. So we didn't have the benefit of long-standing relationships with Phase 1 sites there. So everything is starting from scratch. But sites are coming online as we speak. And similar to the plan for ALPHA2, we also intend to bring EXPAND into both EU and Australia. And the last point that you asked about is still correct. Yes, we do expect to have data for EXPAND coming up roughly the same time as ALPHA2.

Thank you. Our next question comes from the line of Sami Corwin with William Blair. Your line is now open.

Hi, there. Thanks for taking my question. Given that the current commercial CAR T therapies are commercialized by large pharma players or through partnerships with large pharma. I guess, how are you -- are you thinking about commercializing ALPHA-501 alone or do you think you'll need a commercial partner?

Yes, Sami, let me take that, great question. I mean, that's something that we are internally discussing, and I think once we furthered the position and how we're going to commercialize, we will share that information. But I think it's a little bit too early for us to say one way or the other.

Thank you. Our next question comes from the line of Luca Issi with RBC Capital. Your line is now open.

Great. Thanks so much for taking my question. Maybe, Jack, if I may circle back on a prior question. Can you just talk a little bit about your enrollment projections for ALPHA2 versus EXPAND. What gives you confident you can complete enrollment of both trials in the first half 2024, you see something in enrolling EXPAND much harder than rolling out ALPHA2, but I would love to hear thoughts on that. And then, Eric, thanks again for all your help and all the best in your next chapter.

Thanks, Luca, for the question. This is

Thank you. Our next question comes from the line of Tony Butler with EF Hutton. Your line is now open.

Thanks very much. David or

Thank you for the question. So as we are -- as we said at AACR and is still true today, we are continuing with the dose finding or exploration part of this trial. I don't want to get into details about how many patients have been treated at each dose beyond what has been shared publicly AACR. We do expect to be able to share additional information from this trial later on. And we're continuing the enrollment now. And other than that, though, I very much agree with your assessment that -- the data that was shared at AACR certainly is compelling and superior to what these patients could expect from standard of care.

Thank you. Our next question comes from the line of Akash Singh with Oppenheimer. Your line is now open.

Great. Thank you. Thanks for the question. And also a good lot, Eric, not to Renew, but best of luck. The question I have is just when you read out ALPHA2 later in 2024, I was just wondering what sort of -- what's out there in terms of a comparison, or what are you looking for that would give you comfort given your discussions with the FDA to sort of enable BLA looking activity – BNA [ph] enabling activities, whether it's response rates and duration of response. I mean what's the sort of ballpark figures you're thinking about or that would make you comfortable ? And then just a minor follow-up to a previous question, which is that are you dosing patients ALPHA2 with -- from your commercial facility? Thank you. Thanks for the question.

So maybe I'll take the first one. The -- so I think primarily, what's giving us comfort about the Phase II program is all of the experience that we have from Phase I, which was really, again, brought to the surface in June at the various conferences where we share data feedback there and since it's been overwhelmingly positive from investigators, both those that are involved in the trial and those that are not. And so those are in patients that meet the eligibility criteria for our Phase II program. And so that's sort of our view going forward. And I don't want to get into specifics about conversations with FDA, but we think that this is filling a much-needed niche in the landscape currently given all of the access limitations that David alluded to previously in the prepared remarks. Maybe David, I'll hand it to you for the commercial facility question.

Yes. So the second question is about patient dosing. As we have previously communicated, the patients are currently being dosed from the materials that our contract manufacturer has produced in to way that we have treated the patients in the Phase I study

Thank you. Our next question comes from the line of Kishore Gangangari with JMP Securities. Your line is now open. Kishore, your line is open. Please check your mute button.

Hey, this is Reni Benjamin. Can you hear me?

Hi Reni.

Hey, thanks for taking the question. I don't know where they got Kishore from, but Eric all the best in your future endeavors. The question that I have has to do with ALLO-316. I view that as kind of like the next main value driver and driver of shareholder value. I'm kind of curious, as you're looking at the in-vitro companion diagnostic, can you talk -- provide a little bit more color regarding this, how invasive is the process? Are you identifying patients in the real world that's kind of different than what you might have predicted from the hemological studies? And I guess, finally, you expect dose escalation to complete by the end of 2023. But how many patients do you think you'll have by the end of the year? Thanks.

So the first question on the companion diagnostic, I can tell you that it is not -- I mean it's a biopsy, but we're allowing biopsies that were taken prior to study enrollment for evaluation. So, some patients are requiring fresh biopsies if there's no prior material that is accessible. But many others are just giving us blocks from their original diagnosis or a recent operation of biopsy. So in that regard, it's no more invasive than any other sort of tissue assessment that occurs every day in oncology. And then the second question -- the second part of that question was, are we seeing differences in the results of these tests and what we'd have expected from the literature. The answer to that question is no. What we're finding is very consistent with the literature, so there's been no surprises there. As far as the second question, the number of patients, again, I don't want to get too into the weeds here on what setting expectations for the future updates. But we have -- the interest in this program is very high, and that was, again, spiked after the ACR presentation. It's remained high ever since. And so, there's been an abundance of patients who are interested in abundance of investigators who are interested in putting patients on to the trial.

Thank you. Our next question comes from the line of Jason Gerberry with Bank of America Securities. Your line is now open.

Hey guys. Thanks for squeezing me in. so just had a question for David. I wanted to come back to earlier comments just about the challenges of autologous CAR-T pacings of linearly scaling manufacturing? And I really wanted to get your perspective on what you see as like the biggest impediment in the autologous approaches moving forward with like the centralized point of site model like is being explored by companies like Galapagos. So what do you see as sort of the biggest hurdle to operationalizing that and scaling? Thanks.

Yes. Great question. I do have same questions, exact questions that you're asking. I mean, obviously, I have to respect how different companies are thinking about to advance autologous cell therapy and the sort of quick manufacturing or point of care manufacturing sometimes comes up. Obviously, these are early days, and I don't have a clear picture about how that's going to play out. But when you think about autologous cell therapy, there are multiple dimensions. One is it has to be manufactured one at a time. Patients have to undergo leukapheresis and as well as the waiting for -- like any other products that are used in human, all the release test that has to be part of the manufacturing process before the product can be used in human. And I think all these things provides, in my view, somewhat of a barrier to really realize the full potential of the CAR T therapy. And that's where the value proposition of the allogeneic cell therapies coming

Thank you. Our next question comes from the line of William Pickering with Bernstein. Your line is now open.

Good morning. Thanks so much for squeezing me in. In your ALPHA2 study, how much outpatient dosing have you seen so far in the trial? And what are your expectations for how common that might potentially be in a commercial setting? And if I can maybe just ask one more, what are your expectations for the time horizon for an allogeneic therapy to be rolled out at hospitals that don't administer autologous CAR-T today, such as a community hospital, basically trying to understand when you might be able to access some of these market segments where you're not competing head-to-head with autologous? Thank you.

Hi, Bill, great question. In terms of our patient dosing, the ongoing studies to allow that. I mean, at this as we treat more patients, we will be able to provide more information, but I think it's relatively too early. And in terms of the second question about allogeneic in the outpatient setting and all that, I mean, I think that's the direction that we want to take our programs to. So at this point, it's still early. So stay tuned.

Thank you. Our next question comes from the line of Ben Burnett with Stifel.

This is Carolina Ibanez Ventoso on for Ben Burnett. Thank you for taking our question. A follow-up on the in vitro companion diagnostic, you have designed for ALLO-316, you mentioned that this tissue based. Is this IHC type assay and wondering if you are planning to conduct a centralized diagnostic assessment, and would appreciate also if you can talk to how you plan to account for heterogeneity in CD70 expression? Thank you.

So it is an IHC-based assay. And so that gives us an opportunity to address and understand and score the heterogeneity. So we've taken that into account in the development of the assay

Thank you. That concludes our question-and-answer session. I would like to turn the conference back over to management for any additional comments.

Thank you very much for joining our call today. We are thrilled that our off-the-shelf CD19 AlloCAR T data continues to demonstrate both great promise in hematologic cancers. And we remain focused on advancing the industry's first potentially pivotal allogeneic CAR-T trial in order to enable more patients to access CAR-T. Operator, you may now disconnect.