Anca Alexandru - Head-Communications Adi Hoess - Chief Executive Officer Florian Fischer - Chief Financial Officer.

Brian Abrahams - Jefferies Do Kim - BMO Capital Markets Michael Schmidt - Leerink Partners LLC Yale Jen - Laidlaw & Company Nick Abbot - Wells Fargo.

Good day and welcome to the Affimed Third Quarter 2016 Financial Results and Corporate Update Conference Call. At this time, I would like to turn the conference over to Dr. Anca Alexandru, Head of Communications. Please go ahead ma’am..

Thank you. I would like to welcome you to our investor and analyst call on the results for the third quarter of 2016. On the call with me today are Adi Hoess, CEO of Affimed, who will present the corporate update and Florian Fischer, Affimed’s CFO, who will walk you through the financial.

Before we start, please note that this call and the Q&A session contain forward-looking statements, including statements regarding our future financial condition, business strategy, and our plans and objectives for future operations. These statements represent our beliefs and assumptions only as of the date of this discussion.

Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons why actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future.

These forward-looking statements are subject to risks and uncertainties and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors including, but not limited to those identified under the section entitled “Risk Factors” in our filings with the SEC and those identified under the section entitled cautionary statements regarding forward-looking statements in our Form 6-K filed with the SEC earlier today.

Thank you for your understanding. I will now hand the call over to our CEO, Adi Hoess, who will provide the corporate update..

Thank you very much, Anca. Affimed engineers’ target is immunotherapies, seeking to cure the patients by harnessing the power of innate and adoptive immunity.

We have clinical and pre-clinical stage pipeline of next generation immune cell engagers based on bi and tri specific kind of antibodies and we our platforms to develop engagers for two distinct types of immune cells, namely natural killer, or NK-cells, and T-cells.

Since our NASDAQ IPO, in September 2014, we raised about $120 million in gross proceeds and our cash position as of June 30 was approximately €56.8 million. We employ about 64 people with our headquarters located in Heidelberg, Germany, and offices in Mainz, Germany, New York. We have several updates.

I would like to start with presenting an overview of our clinical and pre-clinical, NK-cell, T-cell engagement programs.

As a sponsor, we are evaluating our lead candidate AFM13, a biosynthetic CD30/CD16A NK-cell-engaging TandAb in combination with Merck and anti-PD-1 antibody KEYTRUDA pembrolizumab in Hodgkin lymphoma patients relapsed or refractory to chemotherapy, including Adcetris.

This study is ongoing and safety has been determined for the first dose cohort and we are now recruiting into the second dose cohort. We are on track to provide the first update on this study by the end of the year or in the first quarter of 2017.

In the phase 2a monotherapy trial for AFM13 in Hodgkin lymphoma sponsored by determined Hodgkin study group. we are working with the sponsor to revise the study protocol and anticipate providing an update on the revised in- and exclusion criteria and overall study design by the end of 2016.

For the time being the study remains open and recruiting under the original study protocol to gain insights into specific patient subsets. As a third clinical trial for AFM13, we now intend to conduct a company’s sponsor trial in CD30-positive lymphoma including T-cell lymphoma.

We plan to integrate translational aspects of the phase 1b/2a study in CD30-positive lymphoma with cutaneous manifestation into this trial, which had previously been planned as an investigator-sponsored translational trial to be led by Columbia University.

We have decided to advance AFM24, an EGFRwt/CD16A TandAb, in solid tumors and has selected a development candidate for AFM24 in indications such as lung, head and neck and colon cancers. We have advanced the molecule in [indiscernible] we intend to provide an update on the program in the first half of 2017.

In our discovery program for multiple myeloma, we’re developing AFM26, a bispecific molecule targeting B cell maturation antigen or BCMA and CD16A. Pre-clinical investigations are ongoing.

In addition to the bispecific program, we’re also pursuing the trispecific approach to treat multiple myeloma with molecule defines to find various tumor specific targets including BCMA and CD200. I will provide some more details on this approach later in the call.

For our T-cell-engager pipeline, we have initiated a phase 1-escalation trial recently of our CD19/CD3 TandAb AFM11 in patients with relapsed and refractory acute lymphocytic leukemia or ALL..

The second [indiscernible] T-cell-engager program AMV564, a bispecific TandAb targeting CD33 on tumor cells and CD3 on T-cells, it is developed by Amphivena Therapeutics. Amphivena intends to initiate the Phase 1 study in the patients with AML.

In terms of pre-clinical T-cell-engagers as communicated for the first time in our previous earnings call, we have established another platform of MHC-peptide targeting TandAb to address the needs for tumor specific targets and we have successfully generated a number of T-cell TandAb specifically binding MHC-peptides complexes.

I will give you a more detailed update on this program later. Slide 5. A fact that is distinguishing Affimed from other companies in the immuno-oncology field is our expertise and leadership in natural killers’ elevated approaches and we believe that targeting CD16A is the key to efficient NK-cells recruitment.

NK-cells are [indiscernible] killers of cancer cells and gatekeepers of adoptive immunity and they [indiscernible] new cascade beginning with antigen presentation and leading to T-cell activation. Our NK-cell target CD16A is the most [indiscernible] on off switch on NK-cells.

Our CD16A targeting NK-cells TandAb have several advantages for example, [indiscernible] IgG, mainly their enhanced potency, which is due to a much higher affinity to CD16A on NK-cells. This is over a 1,000-fold higher compared to IgG.

Further as we can see from this graph, CD16A binding is virtually not influenced by the presence of human serum IgG, and our NK-cell TandAb do not bind to CD16A on neutrophils, meaning that all molecules are free to bind the actual target.

AFM13 is the most advantage in NK-cell-engaging antibody clinical development [indiscernible] CD16A and NK-cells and CD30 on tumor cells that are bringing NK-cells into proximity to tumor cells and this leads to an activation of the NK-cell and subsequent killing of the tumor cells.

At the monotherapy, AFM13 was well-tolerated and demonstrated clinical and pharmacodynamic activity heavily pretreated Hodgkin lymphoma patients.

Due to its favorable safety profile, we explored the combination of AFM13 with a variety of anti-cancer drugs, including checkpoint inhibitors and we have shown in [indiscernible] experiments that AFM13 acts synergistically with such checkpoint.

Efficacy has been assessed by in vitro cytotoxicity and inpatient derived [indiscernible] in vivo models, showing models that developed actual human tumors with AFM13 anti-PD-1 antibodies and controls. In vivo, the highest synergy of AFM13 and anti-PD-1 in combination was observed.

In these models, AFM13 induces cross-talk between innate and adoptive immunity eliciting an integrated immune response and activating the anti-immune cascades.

Based on the data from our analysis of AFM13, especially in combination with checkpoint inhibitors, we believe that our NK-cells had the platform has to potentially create transformative new kinds of [indiscernible]. This slide summarizes exclamatory development of AFM13.

As mentioned before, our recruitment is ongoing in the second dose cohort for our company's sponsor Phase 1b trail evaluating AFM13 in combination with Merck’s, KEYTRUDA in relapsed and refractory Hodgkin’s lymphoma patients. We remained on track to provide the first update later this year of our first quarter of 2017.

In the German Hodgkin’s study groups sponsored phase 2a monotherapy trial for AFM13 in relapsed and refractory Hodgkin lymphoma; we're working with the sponsor to revise the study protocol.

The availability of anti-PD-1 therapies in Germany has been affecting the recruitment and we anticipate providing an update on the revised in- and exclusion criteria and overall study design around year-end.

The study remains open and recruiting under the original study protocol in order for us to be able to obtain insights into specific patient subsets. In addition, we are planning the expansion of clinical activities for AFM13 to CD30-positive lymphoma indications, such as T-cell lymphoma or anaplastic large cell lymphoma.

We're also evaluating the combination of AFM13 with newly emerging therapies such as adoptive NK-cell [indiscernible]. As mentioned earlier we have selected AFM24 and EGF receptor wild-type, CD16A TandAb as a development candidate in solid tumor indications such as lung, head and neck and colon cancers.

In vitro, AFM24 has shown higher antigen-specific cytotoxic activity compared to cetuximab, with cytotoxic activity in the low picomolar range. This was also observed in cells expressing the proto-oncogene ras, further differentiating AFM24 from cetuximab, no significant [indiscernible] IgGwasobserved.

Preclinical toxicity evaluation is ongoing and GMP manufacturing is in progress. We intend to provide an update on the program in the first half of 2017. Our EGF receptor variant III [indiscernible] AFM22 and AFM21 remain backup candidates. Slide 9.

in our discovery program for multiple myeloma, we're developing AFM26, a bispecific molecule targeting BCMA and CD16A. There's a high unmet medical need in multiple myeloma as most patients eventually relapsed following initial responses in treatment.

Multiple myeloma is characterized by very high serum levels of M-protein, which consists of immunoglobulins produced by an excess of plasma cells in patients, which is known to strongly impair ADCC activity of monoclonal antibody.

Like all our other NK-cell TandAbs, AFM26 shows a very strong in vitro antigen-specific cytotoxicity, and we see strong NK-cell binding even with high levels of IgG presence.

With this noble mode of action, there is a potential benefit for patients including newly diagnosed multiple myeloma with or without autologous stem cell transplantation and relapsed or refractory multiple myeloma. Pre-clinical investigations are ongoing for AFM26.

In addition to this program, Affimed is pursuing a trispecific approach to treat multiple myeloma, with molecules designed to bind various tumor-specific targets including BCMA and CD200. Here, we investigate two different target mechanisms; dual targeting and co-targeting.

In both cases, the trispecific antibodies made up of a specific specificity for the NK-cell, which is CD16A, and those are the two antigens shown in white here and here as well as [indiscernible] shown here in red and blue, or in red and green respectively.

As you can see on the left here, dual targeting means that both tumor antigens, in this case BCMA and CD200 are found on the same myeloma cell. For co-targeting the trispecific antibody targets to different myeloma cells that express one of the tumor targets each.

Both mechanisms have their advantages with dual targeting focusing on the specificity making the use of the high ability through [indiscernible] binding on tumor cells and co-targeting focusing on efficacy through targeting tumor bulk and initiating cells.

Pre-clinical work is ongoing and to anticipate to provide an update of our molecules at scientific or medical content later this year. Slide 11. Now moving to T-cells. Our T-cell TandAb had differentiated from other therapies in terms of efficacy whether it show high affinity binding for effective killing of cells with low target expression.

Furthermore, AFM11 50-fold more potent than Blincyto at low T-cell numbers. Now also differentiated pharmacodynamically was significantly lower dosing as compared to IgG. This is in the nanogram to kilogram range versus milligram to kilogram range for IgG, which means, there is no receptor saturation required for full T-cell activation.

In terms of safety, diseases such as NHL or ALL, there is a very narrow therapeutic window, which requires careful patient management. For example, interruption of dosing has proven to be an effective way of resolving side effects of either T-cell therapies.

But this is of course, not as easily possibly in all other types of therapies such as [indiscernible] or longer half life by specific antibodies. We believe that our TandAb structures, but as another advantage, which is [indiscernible] receptors. To this end, we have not measured non-specific activation of T-cells.

Only [indiscernible] AFM11, a CD19/CD3 targeting molecule is being developed, leveraging these advantages and as a potential competitor to Blincyto with a well-differentiated target product profile. We believe that AFM11 has advantages in terms of potency, convenience and efficacy. And we see a strong market potential in large indications such as NHL.

We recently have initiated the Phase 1 dose escalation trial of AFM11 in patients, which relapsed and refractory ALL conducted in Eastern Europe, Russia and Israel. We have further conducting a Phase I study in NHL, where we held [indiscernible] expect to presentation by year-end due to recruitment that this lower than expected.

We’re responded to this by initiating additional trial sites in the U.S. and Eastern Europe., and we intend to provide an update on the study timelines of AFM11 and NHL, as well as the progress in the ALL trial in the first half of 2017.

Addressing the high unmet need in AML Amphivena therapeutics plans to initiate the Phase 1 clinical trial in AML for T-cell-engager AMV564, a molecule developed from Affimed kind of platform. AMV564 is a bispecific TandAb targeting CD33 and tumor cells, and CD3 and T-cells.

In pre-clinical studies, the molecule has demonstrated [indiscernible] cytotoxic activity in patient samples as well as robust tumor growth inhibition and a complete elimination of leukemic blasts in xenograft models. There was also corroborative evidence of direct correlation between binding affinity and potency for the drug.

Importantly, no non-specific T-cell activation [indiscernible] pre-clinical models and this is likely due to absent binding to other immune cells, such through the receptors I mentioned before. [indiscernible] obtained an IND approval in July 2016, and plans to initiate a Phase 1b study.

Together with the existing investor consortium, Affimed is financial supporting the clinical development of AMV564 with up to 1.5 million in a [indiscernible] financing of Amphivena, 1 million of which was invested in September 2016.

[indiscernible] pre-clinical pipeline, we have developed another platform to [indiscernible] specifically targeting MHC-peptide complexes. MHC-peptides can also potentially highly specific tumor antigens [indiscernible] generation of antibodies against these complexes has been reported to be extremely challenging.

We have successfully generated a number of T-Cell TandAbs specifically binding MHC-peptide complexes. [indiscernible] pre-clinical evaluation of one of these molecules has demonstrated [indiscernible] expressing the targeted MHC peptide complexes. This is marked by the two classes on the MHC [indiscernible] and peptide.

As you can see here, in this table, control cell lines were not [indiscernible]. Affimed continues to explore these MHC peptide specific TandAbs, which have the potential to [indiscernible] of MHC target positive cells. I will now hand over the call through for Florian Fischer, our CFO, who will provide further details on the financial figures..

Thank you, Adi. Affimed’s consolidated financial statements have been prepared in accordance with IFRS issued by the International Accounting Standards Board or AASB. The consolidated financial statements are presented in euros, which is the company’s functional and presentation currency.

Therefore, all financial numbers that I will present here in this call unless otherwise noted will be in euros. Any numbers referring to the third quarter or the nine months ended September 30, 2016, or the third quarter or the nine months ended September 30, 2015 are unaudited.

Cash and cash equivalents and financial assets totaled €49.1 million as of September 30, 2016, compared to €76.7 million as of December 31, 2015. The decrease was primarily attributable to Affimed’s operational expenses.

Net cash used in operating activities was €25.5 million for the nine months ended September 30, 2016, compared to €14.5 million for the nine months ended September 30, 2015. The decrease was primarily related to higher capital expenditure for research and development in connection with our development and collaboration programs.

Revenue for the third quarter 2016 was €0.9 million compared to €1.2 million for the third quarter in 2015. Revenue in both periods was derived from Affimed’s collaboration with Amphivena and AbCheck Service Revenue. R&D expenses for the third quarter 2016 were €8.8 million compared to €6.4 million for the third quarter 2015.

The increase was primarily related to higher expenses for AFM11 pre-clinical programs than infrastructure. G&A expenses for the third quarter 2016 were nearly unchanged with €2.2 billion compared to €2.1 billion for the third quarter 2015.

Net loss for the third quarter 2016 was €10.3 million or €0.31 cent per common share compared to a net loss of €7.3 million or €0.24 per common share for the third quarter of 2015. The increase in net loss was primarily related to the increased spending on R&D or AFM11 pre-clinical programs and infrastructure.

In addition, the result was affected by lower revenue, lower other income. I will now turn the call back over our Adi for a summary of our two clinical programs and our pipeline.

Adi?.

Sir, I think you are on mute. .

Okay sorry yes, sorry for this, thanks. Our strategy is to maximize the value in our pipeline and platform.

Overall, our pre-clinical and clinical strategies designed to grow the scientific leadership of our NK-cell platform with CD-16A as proprietary target and we’re continuing to expand the pre-chemical and clinical activities of our NK-cell TandAb platform in solid tumors with our candidate, AFM24 [indiscernible] hematologic diseases, where we intend to leverage additional opportunities for AFM13, for example in combination with adoptive NK-cells.

In addition, we’re developing trispecific antibodies applying both a dual targeting and [indiscernible] targeting approach. Again, several targets including BCMA. Interesting is our new approach and that [indiscernible] MHC-peptide complexes.

We have developed a noble platform and have identified several molecules, which are currently on the pre-clinical investigation. Thank you very much for your interest. the call is now open for questions..

Thank you, sir. [Operator Instructions] We will now take our first question and it comes from Brian Abrahams from Jefferies. Please go ahead sir. Your line is now open..

Thank you for taking my questions. Good morning. The question on the BCMA program that seems like you’re talking about first time here, very interesting to hear that, obviously bispecific BCMA targeted antibodies have been, in the news a bit more lately.

I think you started to touch upon it on the presentation but maybe, if you could expand a little bit more on the scientific rationale for targeting NK-cells versus T-Cells in myeloma and with BCMA target that will be helpful, and then a couple of follow-ups?.

Hi, Brian. thanks for the question. so, we have started the program quite a while ago, and have you evaluated those NK-cell and T-cell approaches and the one day that occurred to us that in specifically and multiple myeloma, one has this very high levels of M-protein, which is nothing else [indiscernible] circulating IgGs.

We have discovered in our own investigations that targeting [indiscernible] is noncompetitive IgG and hence we have a very selective advantage over many other modalities including IgGs.

Overall, multiple myeloma is a disease with patients presenting in a very board picture, one way is to thereby think of aggressively targeting that disease by T-Cells and the other approach would be by leveraging NK-cells and rather than moving back into combinations as we've already seen in multiple myeloma that the majority of treatments are already combinations.

we feel within the NK-cell approach, we are much better off in order to move that frontline and not just to have it as a standalone therapy. So, that's one of the rationales. Obviously, by targeting CD16A that is not competitive with circulating IgG, we could introduce [indiscernible] killing or also in the similar trends described to the ADCC.

So that's a rational behind that.

We will also see that many patients at least the substantial number of patients in multiple myeloma, and [indiscernible] transplantation and usually as the second line therapy, so I'd say presents to us is a very synthetic opportunity, we have been maybe able to develop 8 and 26 given in combination with the transplant especially when the transplant is [indiscernible] adoptive NK-cell transfer.

Does that answer your question?.

Yes, it’s very helpful. And then just on AFM13.

Can you give us sort of an update on what we might be looking for in the end of this year, early next year with the updated KEYTRUDA combo study, just in terms of general patient numbers? will this be more than just the first dose, do you think you will be at potentially therapeutic levels of AFM13 and have data that's mature enough to be comfortable or will this be more of a safety update?.

Again, thanks for the question and just to give you, again the background of the study as we have described it in the past to our currently dosing patients with active level of [indiscernible] given every three weeks and we are dose escalating AFM13 and the first dose was just slightly below the [indiscernible] dose level of which we have described in the past of 1.5 [indiscernible] the current dosing is being done and [indiscernible] for the remainder of the time.

So yes, we are slightly below and obviously, we have concluded that cohort and has started to enrolling to the second cohort, which is now at active dose level. Depending on how the speed is also that second dose cohort, we could already present some data next year on the efficacy of that, because we will be then at active dose levels of AFM13.

But for the time being we have basically concluded the first dosing cohort has determined that the combination has been taken [indiscernible] already a good success that we didn’t see any unexpected toxicity..

Excellent. And then one last question I'll hop back in the queue. Can you maybe talk a little bit more about the rationale for bringing the CD30 positive lymphoma study in-house and having that the company sponsor study? I know relying on university timelines can get a bit murky.

I'm just wondering is that really just to enable quicker collection of biopsy data and analysis of some of the translational data and are there any potential rate limiting stuffs there in terms of transforming the IND from Colombia to [indiscernible]? Thanks..

We have been since the declines of PD-1 and Hodgkin lymphoma; we had taken a certain strategy on how we push forward with AFM13, which has the highest clarity in that combination.

However, when we checked in terms of opportunities outside of Hodgkin lymphoma, it occurred to us that especially T-cell lymphoma is underserved by immunotherapies and we have also seen that checkpoint hasn't been quite as effective. So, we expect a lot less competition there.

So, this is something, which we had discussed since the past six months, if we should rather take that on as a higher priority; and this is basically the conclusion now that we feel that we have a reasonable tranche to develop AFM13 in T-cell lymphoma, might be as a monotherapy maybe or also in combination, but we will face much less competition at least from checkpoint.

[indiscernible] obviously when you want to do that, we realized that T-cell lymphoma is a rare disease and hence, we would need a lot more site, and that taken together prompted us now to rather [indiscernible] T-cell lymphoma study as a company responsible study..

Thanks, Adi..

We will now take our next question; it comes from Do Kim from BMO Capital Markets. Please go ahead, the line is open..

Good morning. Thanks for taking my question.

My first question on AFM13 and KEYTRUDA combo, I was hoping you could clarify for us what the hurdle is for that combination in the phase 1b trial at the active dose, what do you think you would need to see to feel encouraged that you're seeing benefit? And also in the long-term outcome, is that 27% complete response rate for KEYTRUDA be appropriate competitor?.

Yes, thanks for that question.

So, in terms of control studies, we have only seen data from [indiscernible] currently KEYTRUDA has been a smaller study, phase 2 study, but we are rather relying on the study conducted with [indiscernible] at that stage, which was over 100 patient study in Hodgkin lymphoma patients; and [indiscernible] analysis rather in the 10% range.

So, we will compare our numbers to what has been seen here, so we are indeed expecting an increase in the CR rate and as we've said in the past, anything beyond 20% will be considered to be a success, and [indiscernible] 30%, I think very strong argument to continue with such a strategy using second and frontline therapies.

So, this is what we're aiming at currently..

Okay..

However, obviously the study is defined in a way that we will measure objective response rate after three months, after six months, but also we will continue to follow the patients in terms of seeing its - basically the durability of response..

Right.

And for AFM11, could you talk about the status of the new trial sites you've got initiated, are they up and running and are you seeing any slowness in enrollment for those sites too?.

So, in particular, we are not so much commenting on details on where we stand with the studies, but to - as you've seen we've just indulged the first patients in ALL, so - and NHL and ALL have been pursued in parallel in terms of site openings, very often besides in Eastern Europe that we have contracted for AFM11 [indiscernible] willing to participate in the NHL study.

So in that we expect, yes, some of the sites are already open and are recruiting..

Great.

And my last question is maybe you could talk more about what drove your decision to choose AFM24 over 21 and 22 [indiscernible]?.

Very good question. So the strategy of that approach in the past has basically AFM24 targets and antigen that’s tumor [indiscernible] tumor specific, while 21 and 22 target EGF receptor variant III, which is described to be highly tumor specific.

However, what we are also realizing is that probably the usage of EGF receptor variant III [indiscernible] patients is not as broadly as for AFM24 EGF receptor wild type and [indiscernible] one of the rationales.

The second one is that we are currently, basically conducting a variety of experiments, where we [indiscernible] AFM24 again in combination with other agents and our investigating synergies. And one of the indications were EGF receptor antibodies have already been launched [indiscernible] developed quite successfully.

So, the overall strategy behind AFM24 is to bring it into one of these larger indications and obviously, AFM24, we have a much larger patient population in lung cancer as compared to the other two molecules AFM21 and 22.

With 24, we are currently conducting the [indiscernible] and as I said before, we will plan to give you an update in the first half of 2017, and then I think we have a very good understanding of, if we can bring AFM24 forward or if we can jump back to 22 and 21 as backup candidates..

Great. Thank you for taking my questions..

We will now take our next question is coming from Michael Schmidt from Leerink Partners. Please go ahead. Your line is open..

Hi, good morning and thanks for taking my questions. I had one on AFM13 and one if you could give a sense of your thinking around a potential pass to market down the road for this combination and these are fairly complex, and evolving landscape and Hodgkin lymphoma where we expect [indiscernible] for example and studies of PD-1 to ongoing.

How do you see the development pass there, involving for the combination?.

Thanks a lot for that question. And obviously, it’s dependent on how the data from the ongoing studies are emerging. So as I said before, I can’t give you really a precise [indiscernible] drug at that stage as long as we don’t have the data.

But for the time being, we can either consider to take the combination and target just the relapsed and refractory market, where Adcetris currently is taking. So that’s one of the options. the second one could be to push forward in elderly patients, where outcome in general, has been less good for patients as compared to the younger patients.

So that will be the different options, but in order to really provide a precise update on what we are going to do were obviously now looking into [indiscernible] line that exactly.

[indiscernible] without being too precise obviously as I said I can’t be too precise, but what I would like to say we have these strategies developed and if one [indiscernible] we can execute quickly on the respective option. .

Okay.

and then a question on, you mentioned revising inclusion criteria in the phase 2a monotherapy study of AFM13, could you comment on that some more what patient are you looking at and when should we get update from the study?.

Yes, thanks a lot. This is an ongoing discussion. So we're going to do and provide you an update, once that’s being done with - completed with the German Hodgkin Study Group. .

Okay. And a question on the T-cell lymphoma that you are planning, so this is obviously a very heterogeneous type of cancer with many different peptides we've seen CD30-targeted [indiscernible] is being used there for example, [indiscernible] T-cell lymphoma or another peptide.

Where are the specific areas that you’re targeting for the study initially? How do you think about the positioning here?.

Yes, again a very good question. And we're currently, exactly defining and discussing [indiscernible] however, some of the indications that are obviously higher in focus is anaplastic large cell lymphoma former as I have mentioned before. We're about 95% of patients to express CD30.

In the other indications we are [indiscernible] to determine is that what kind of levels of CD30 expression is really required for a clinical activity. So those parameters are currently being discussed, but also investigated and all that comes together [indiscernible] and will be then presented as a clinical plan.

[indiscernible] at the moment, we cannot give you a very detailed insight into that, but it is obviously not to do similar to what we have seen in the past with other CD30 targeting [indiscernible]?.

Okay. And one on AFM24 and conceptually, if you have an antibody that’s potentially more potent than [indiscernible] for example targeting EGFR.

How do you think about the risk around exacerbating on target side effect?.

Yes. Mike, this is a very good question and as I said before. We are currently investigating AFM24 in tox studies. I may have not mentioned it, but the drug AFM24 is [indiscernible] where we can directly compare than our [indiscernible] EGF targeting antibodies, firstly the molecules are entirely different.

So, our molecule has no [indiscernible] and thereby, we will present with different features and as I said, we’re currently analyzing that and as soon as we have such data, we can take the next step on how to move forward and the other strategy we have in mind is that we may just use [indiscernible] AFM24 to levels, where we can provide enough in case of infiltration into the tumor and then come along with a checkpoint antibody in order to enhance efficacies.

so, something which we could show that, that it nicely works for AFM13. So maybe even if we might see some toxicities for AFM24, there could be an opportunity that the combination of these two agents could provide additional efficacy, which the single agents wouldn’t otherwise show.

As we’ve seen at least the first dose cohort of AMF13 and PD-1 turned out to have a good safety profile. So, we can now increase the dose [indiscernible] basically the combination of these two drugs do not develop any surprising toxicities at least to date..

Okay. Thank you very much..

[Operator Instructions] We will now take our next question it comes from Yale Jen from Laidlaw & Company. Please go ahead. Your line is open..

Good morning and thanks for taking the questions. Just one follow-up, a little bit on the CD30 lymphoma study for 13, which is that, I know you guys are planning these [indiscernible] various target and indications.

Should we think about that potentially you would have to be able to start a Phase 1 or 1, 2 study, let’s say in maybe midyear next year or which we will think about this is a second half of 2017 development?.

Thanks for the question, but currently I cannot comment on any timings of that..

Okay.

Also that in AFM26 for multiple myeloma at this point, how do you think at this point to position this job in the line of therapy, would that be something of the [indiscernible] sort of top line?.

Yes, thanks for that question. so, we have had discussions with the key opinion leaders on this approach, AFM26, i.e., targeting BCMA and using [indiscernible] as the active killing agent. And one way of positioning that we have been discussing is the opportunity to bring AFM26 together with NK-cells in an adoptive cell transfer.

And that can be done in combination with stem cell transplantation that is as I said, before already a certain complement of therapy already and that could be second line.

So there is indeed different options on how you can do that, you also now need to investigate some of the synergies with the drugs [indiscernible] and Revlimid, which also has been described to enhancing cable activity.

So there is a further set of pre-clinical studies that we’re currently conducting, [indiscernible] just around Revlimid, but the other agents and dependent on how these pre-clinical works then turn out to be. We can decide and design certain strategies and how to move forward that.

As I said before one strategy which is very appealing is to move with AFM26 into the transplant setting and why am I saying it because we can imagine that you can much as [indiscernible] NK-cells and AFM26 as separate agents, but you could potentially think about the co-mixing these two drugs, so the adoptive NK cells are highly active NK cells with AFM26 and then [indiscernible] obviously; we are still increasing the development.

so, there is lot of investigations ongoing, but that appears to be quite appealing as we've learned from the discussions with key opinion leaders. .

Yale Jen:.

[indiscernible (49:04)]:.

Yes, it is a very good question. So, the analysis of such peptides being done in the context of how abundantly they are identified in the tumors. So, there is a lot of work going into the characterizations of such peptides that are specifically presented [indiscernible] tumor cells.

I think another strength of this project what we are doing here is that we do indeed [indiscernible] similar peptides that are expressed in healthy tissues.

So, our screen is quite a sophisticated screen and the first place in order to identify [indiscernible] specific antibody, so hence to make antibodies against MHC-peptides is possible, but the trick is to get that very high specificity and at least for this project, it looks like I think we have succeeded to [indiscernible] the super high specificity plus MHC-peptide, and we refused about 20 control peptides in that screen in order to create that specificity.

So this is the approach behind that. Yes, we are not thinking that we need multiple of these TandAbs targeting different peptides.

So, we have a plan and it’s really to identify one of these peptides that are quite widely expressed in tumor cells and thereby, you can go for T-cell engagement in solid tumors, which still is a high desire, because of the potency of T-cells that is very challenging, because of the lack of specific targets for MHC-peptides clearly represent such group of targets and as I said, it’s more on the technological side on how to make these antibodies specifically.

What was very good result in addition so the results that we’re showing here is so killing of tumor cells that indeed [indiscernible] express these peptides. So we may only expect, let’s say in the worst case 2030 copies of such peptides, maybe 100, maybe 300 MHC-peptide complexes that are specific.

So, you see that we can go down to the extreme low number and still see specific killing of such tumor cells. So, that is I think a very important result, because if you need let's say, 10,000 receptors before you see killing, you would miss most of the cancer cells.

So, being able to go down to 100 or maybe even below maybe 100 copies, it's a power of our technology and we believe that that power is a [indiscernible] TandAbs structure, which provides for the ability effect.

So, that's a combination of specific antibody, high potency of T-cells and ability targeting by the TandAbs can thereby pickup very few copies of these MHP-peptides. And we'll have to see how [indiscernible] at the end of the day is, but for the time being that's one of the promising approaches [indiscernible] for solid tumors..

[Operator Instructions] We will now take our next question; it comes from Nick Abbot from Wells Fargo. Please go ahead, the line is open..

Good morning. Thanks for taking the question.

On the German Hodgkin Lymphoma Study Group, do you think they'll be able to pick the winner in terms of the dosing strategy from the number of patients that you've enrolled, and more broadly then going forward with these newer programs, what dosing strategy are you selecting?.

Good question. Thanks a lot. That's one of the reasons why we're continuing with the study and enrolling patients, although diversity of patients enrolled in the mean time is becoming larger, because some patients had PD-1, others didn't have PD-1, still we are not only looking at - [indiscernible] outcome of that study, that's one end point.

But we can also connect a lot of pharmacodynamic data in these patients and related to certain features; for example, NK-cell activations, so there is a good reason to now continue collecting such data; because overall, we think that we can have like 15, 20 patients then treated with AFM13 immunotherapy and that should be sufficient in order to help us guiding that respective doses.

Overall, [indiscernible] this also has been exemplified by the combination study, we're already favoring one of these approaches, where we could [indiscernible] week or two weeks, and then continue to a repeat dosing. One of the reasons is that we see a very fast uptick in case of - by our approach.

So, we have this very high affinity binding to CD16A on NK-cells and also high affinity cancer [indiscernible]antigen binding, so that moves in case very quickly into the tumor and that's why it may be sufficient to just do this for a relatively short period by two weeks, and then continue with the weekly dosing..

And then for 24, you mentioned that we've got this [indiscernible] you're willing to tolerate? I also heard you stay well with the combination with the PD-1 [indiscernible] we may see some synergy, which suggest [indiscernible] you don’t need to dose attend that at a level that going to give you a lot of toxicity with the assumption that the efficacy will come through the PD-1 combo.

How do you differentiate between - what dose do you need in the single agent in combination?.

Yes. Very good question. So obviously, this is going into our clinical development strategy.

And without going into detail on what we have in line broadly, I can say the following that some probably many people also would think this way, probably [indiscernible] EGF receptor tumors in the first place and that gives us as a selective advantage to enrich the antibody in the tumor before you see a significant enrichment in healthy tissue.

So these are the studies that again pre-clinically we’re doing, if we see that selective uptake into tumors depend on EGF receptor wild type question. But that’s what we have discussed with opinion leaders as a very viable strategy in order to move forward. But as I said, at the moment, we have [indiscernible] any toxicity or not.

So we first need to see on how that’s evolving and only once those date are available, I think we can take the respective conclusions. But nevertheless, we would target not so much an indication specific approach initially only going for lung, or only going for head and neck, but other select patients that have high expressing EGF receptor tumors..

Okay. And then I have a question for that, I know there has been some data for the TKI showing that they increased [indiscernible] expression on tumors, which obviously, it’s not relevant to the TandAb, but perhaps would be relevant to a combination with the PD-1 inhibitor.

Is that something you’ve been able to look at? What are the effects of MHC [indiscernible]?.

Yes. Thanks for that question. Indeed, I cannot comment on it at that stage. .

Okay. Fair enough. And then just last quick one on BCMA. Our competitor has product that they claim does not buy into soluble BCMA, which obviously would be very advantageous. Have you looked at soluble BCMA binding and [indiscernible] BCMA BiTE.

Have you been able to compare BCMA BiTE versus the TandAb as you’ve done for [indiscernible]?.

So that was the experiment that is currently ongoing in detail and I can’t assure you any data on that. Just keep in mind, you see develop T-cell approach and as I explained before usually dosing is very, very low. So we are usually talking nanogram to kilogram approaches and then you already see T-cell activations.

So if you have a lot of soluble antigen around, it may indeed the very competitive to T-cell approach. As we see with in T-cells we can dose them very high and [indiscernible] up to receptor saturation and we have a lot of soluble CD30 initially in patients.

However, dosing it with a [indiscernible] fully eliminate soluble CD30 and already with the first dose. And taking an T-cell BCMA approach, probably should have a similar feature and they just not suffer from that competition by solid with BCMA.

Is that a fair answer?.

That's fair answer. Thank, Adi. .

We have no further questions in the queue. I would like now to hand the call back to you for any additional closing remarks. Thank you, sir. .

Yes. Thanks a lot. I will conclude. I will thank everybody for listening and asking questions. And I will conclude now the third quarter update call. Thank you very much..

Thank you. Ladies and gentlemen, that will now conclude today's conference call. Thank you very much for your participation today. You may now disconnect..