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Edited Transcript of CTMX earnings conference call or presentation 9-May-19 9:00pm GMT

Q1 2019 CytomX Therapeutics Inc Earnings Call

SOUTH SAN FRANCISCO May 22, 2019 (Thomson StreetEvents) -- Edited Transcript of CytomX Therapeutics Inc earnings conference call or presentation Thursday, May 9, 2019 at 9:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Christopher S. Keenan

CytomX Therapeutics, Inc. - VP of IR & Corporate Communications

* Robin Knifsend

CytomX Therapeutics, Inc. - VP of Finance

* Sean A. McCarthy

CytomX Therapeutics, Inc. - Chairman, CEO & President

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Conference Call Participants

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* Alec Warren Stranahan

BofA Merrill Lynch, Research Division - Research Analyst

* Ashiq Alim Mubarack

Wedbush Securities Inc., Research Division - Associate

* Biren N. Amin

Jefferies LLC, Research Division - MD and Senior Equity Research Analyst

* Boris Peaker

Cowen and Company, LLC, Research Division - MD and Senior Research Analyst

* Jackson Dean Harvey

Nomura Securities Co. Ltd., Research Division - Research Analyst

* Joseph Michael Catanzaro

Piper Jaffray Companies, Research Division - VP & Senior Biotech Analyst

* Mohit Bansal

Citigroup Inc, Research Division - VP and Analyst

* Olivia Simone Brayer

Barclays Bank PLC, Research Division - Analyst

* Waleed Abdel-Naby

SunTrust Robinson Humphrey, Inc., Research Division - Research Analyst

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Presentation

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Operator [1]

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Good day, ladies and gentlemen, and welcome to the CytomX Therapeutics First Quarter 2019 Financial Conference Call. (Operator Instructions) As a reminder, this call may be recorded. I would now like to introduce your host for today's conference, Mr. Christopher Keenan, Vice President of Investor Relations. Chris, you may begin.

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Christopher S. Keenan, CytomX Therapeutics, Inc. - VP of IR & Corporate Communications [2]

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Thank you, Liz. Good afternoon, joining me today are CytomX President, Chief Executive Officer and Chairman, Dr. Sean McCarthy; and CytomX's Vice President of Finance, Robin Knifsend. Before we begin, I would like to remind you that we'll be making forward-looking statements during the call. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict and many of which are outside of our control.

Important risks and uncertainties are set forth in our most recent public filings with the SEC at sec.gov, including our Form 10-Q filed today. We undertake no obligation to update any forward-looking statements whether as a result of new information, future developments or otherwise. A webcast of this call will be available on the Investor Relations page at CytomX's website at cytomx.com.

I would now like to turn the call over to Sean.

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [3]

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Thanks, Chris, and good afternoon, everyone. I'm very pleased to be here with you today to briefly review another very productive quarter for CytomX.

At CytomX, we are reinventing therapeutic antibodies for the treatments of cancer. We see a major opportunity to more effectively target therapeutic antibodies into diseased tissue, generating new classes of differentiated anticancer therapies as these are best-in-class molecules against validated targets or for first-in-class molecules against novel targets that we believe our technology can uniquely address. Our innovative approach to antibody localization into diseased tissue is called the Probody platform. Probodies are fully recombinant antibody prodrugs comprised of a therapeutic antibody, a linker and a mask designed in a way that the antibody can't see its target until the mask is removed.

Mask removal occurs specifically and selectively within cancer tissue as a function of disease-associated proteases, which clip off the mask in the tumor allowing the underlying antibody to bind target and elicit its biological effect. Probody therapeutics are designed to offer localized target binding in diseased tissue while maintaining potency, reducing side effects and enabling new targets of mechanisms to be translated into novel product opportunities. We see this as a really big idea backed by decades of research by our deep knowledge of the biology of the tumor microenvironment, innovative protein engineering and a robust intellectual property portfolio. We are the leader in this emerging field of therapeutic antibody localization with 4 clinical stage programs, strong partnerships and recent clinical proof of concept.

The first quarter saw excellent progress by the CytomX team in developing our differentiated technology platform and our lead product candidates as we continue to build on the first Probody clinical data we presented for our lead program, the anti-PD-L1 probody, CX-072, at ASCO last year. Since then, we presented additional clinical and translational data, including from our second program, CX-2009, at ESMO, SITC, at our R&D Day in February and most recently at AACR.

It's been an exciting year for us, and we've learned a tremendous amount about how our unique antibody technology functions in cancer patients having checked key boxes to support proof of concept for the Probody platform. We've demonstrated encouraging antitumor activity and safety profiles for both of our lead wholly owned programs, and we are now intensely focused on the development of next steps for the further development and advancement of these assets.

I'd like to take the opportunity here to briefly recap what we've disclosed to date about the clinical performance of these 2 lead molecules. Our most advanced program CX-072 is a PD-L1 targeting probody for which we have presented increasingly matured Phase I data for monotherapy and in combination with the anti-CTLA-4 antibody, ipilimumab, also known of course as Yervoy.

Our vision for CX-072 is for the probody to become a differentiated centerpiece of combination anticancer therapy by enabling safer, more effective combinations. We also see opportunities for CX-072 to potentially expand beyond the existing market to settings where conventional PD pathway agents are not currently employed. Data presented on CX-072 as monotherapy at our Q1 R&D Day showed that CX-072 continues to demonstrate a favorable safety profile as well as durable anticancer activity in heavily pretreated patients with tumor types not typically expected to respond to PD pathway inhibitors.

Data from the completed dose escalation phase of PROCLAIM-CX-072 showed that of 24 efficacy evaluable patients, all with generally weakly immunogenic tumors and treated with doses greater than or equal to 3 mg/kg of CX-072, 12 or 50% of patients demonstrated tumor shrinkage, including 4 partial responses. CX-072 was generally well tolerated with maximum tolerated dose not reached.

Preliminary results from dose escalation informed our ongoing monotherapy dose expansion cohorts studying the dose of 10 mg/kg of CX-072 in multiple tumor types. As reported during our Q1 R&D Day, CX-072 is showing activity in several tumor types at this dose and updated data from these expansion cohorts will be presented in a poster and also as part of a poster discussion session at ASCO 2019.

Turning now to CX-072 in combination with ipilimumab. As reported previously from our dose escalation phase, we've defined the maximum tolerated dose of this combination as 10 mg/kg of CX-072 and 3 mg/kg of ipi, which is the full label dose of ipilimumab. Our preliminary efficacy data is encouraging with antitumor activity, including complete and durable responses seen in advanced stage cancer patients, again, with tumors not generally regarded to be responsive to PD pathway inhibitors. As of our most recently reported data cutoff, of 19 patients evaluable for efficacy, 4 or 21% experienced confirmed responses, including 1 complete response.

Furthermore, among the 27 patients treated with the 072 plus ipi combination of 3 mg -- with ipi at 3 mg/kg or above, the combination was generally well tolerated with 7 or 26% of patients reporting a Grade 3/4 treatment-related adverse event and this compares very well to historical controls, which, of course, have shown incidence of Grade 3/4 TRAEs in excess of 50%, typically for the combination of a PD inhibitor and ipi at full dose.

So these data suggest that the combination of CX-072 plus ipilimumab could allow for the safe and effective treatment of patients in multiple indications with full dose and schedule of ipi with the goal of reaching longer and more durable responses. Based on these important clinical data for CX-072, we are excited about the prospects of the program to make a difference to cancer patients, and we're busy developing our next steps for this unique asset and we'll be laying out our plans in the near future.

Now I would like to turn to CX-2009, a potentially first-in-class probody drug conjugate targeting a unique and broadly expressed tumor antigen CD166. Now because probody therapeutics are designed to minimize binding of drug to normal tissues, we're in a very unique position to address a new class of targets with attractive molecular features that were previously thought undruggable because of their high expression on normal tissues. CD166 is an example of this kind of target. The target is highly and homogeneously expressed in multiple solid tumor types and might be considered an attractive target for a conventional antibody drug conjugate were it not for the fact that it's also present on most normal epithelial tissues.

We think it's a great target for a probody drug conjugate, however, since probodies allow us to more selectively target tumor tissue This is a really exciting program since it combines probody technology with drug conjugate technology with the goal of making a transformative difference for patients across a wide range of cancer types.

During Q1 we presented preliminary clinical data from the Phase I dose escalation portion of the ongoing PROCLAIM clinical trial of CX-2009 monotherapy in a subset of CD166 expressing cancer types, including certain patients that were selected for high-level expression of CD166. The intent and design of this Phase I dose escalation trial was firstly, of course, to evaluate the safety of this very novel drug candidate, safety being a particularly critical question given the widespread expression of CD166 on normal tissues.

We also wanted to understand as much as we could in Phase I about the contribution of the drug conjugate payload to the overall safety profile of the molecule in order to give us the maximum information with which to design our Phase II strategy. And lastly, we were looking for any initial signs of anticancer activity in a late stage, very heavily pretreated patient population that is, of course, typical for such highly experimental Phase I studies.

We've been very encouraged with the preliminary data for CX-2009 that we've shared previously. At the time of data cutoff for our AACR presentation, 71 patients across all doses were evaluable for efficacy. Of the 39 patients who received greater than or equal to 4 mg/kg of CX-2009 and had at least 1 post-baseline on-study tumor assessment, 38% of these patients achieved tumor shrinkage, including 7 unconfirmed partial responses observed in breast cancer, ovarian cancer and also in head and neck cancer. In addition, 74% of patients achieved stable disease or better at the time of their first on-treatment scan. This single-agent activity is the first validation of CD166 as an anticancer target, and we believe holds much promise.

CX-2009 was generally well tolerated. The maximum tolerated dose was not reached at the highest dose level tested at 10 mg/kg, the most common treatment-related adverse events were Grade 1 and Grade 2 and they included nausea, fatigue and decreased appetite. The most common Grade 3/4 treatment-related adverse event was keratitis.

And so it's worth taking a moment or two to just reflect on the safety profile given just how broadly expressed this target is on normal tissue. We believe these data are strong evidence that probody masking technology can really allow us to target first-in-class tumor antigens regardless of their broad normal tissue expression, and we see this actually as an important advance in the field of antibody therapeutics generally.

The keratitis that we observed principally at high doses of CX-2009 is a well-established side effect of DM4, the drug conjugate payload that we're employing in this drug candidate. We are now engaged in further dose refinement, while taking steps to manage keratitis with ocular prophylaxis, which has been shown to be affected by others. This ongoing work will enable us to finalize our strategy for Phase II studies, which we'll be communicating in due course. Taken together, we are very pleased with how our wholly owned CX-072 and CX-2009 programs have progressed to date, and we look forward to providing a more detailed road map for these 2 assets in the coming months.

I'd like to comment briefly now on our pharma alliances. Firstly on our BMS alliance. This partnership was entered into in 2014 and was expanded in 2017. In total, the alliance provides BMS with access to up to 12 discovery targets from the CytomX platform. To date, CytomX has received a total of $287 million in upfront and milestone payments from BMS. The lead program in the alliance is the anti-CTLA-4 Probody, BMS-986249, which is based on ipilimumab and continues to progress through a Phase I/II clinical trial being run by BMS.

Our shared vision with BMS is that the CTLA-4 Probody has the potential to be a safer, more effective version of Yervoy allowing the full realization of CTLA-4 as a powerful and highly validated cancer immunotherapy target. Additional research work continues under this alliance, and we look forward to additional targets that BMS may select in the future.

Now I'd like to return to the drug conjugate space for just a moment where our alliances with AbbVie and ImmunoGen also continue to advance. In collaboration with AbbVie, CytomX is advancing a second clinical stage probody drug conjugate, CX-2029 directed against CD71, which is also known as the transferrin receptor. This program has the potential to turn CD71 a widely expressed receptor on normal tissues into a druggable target. CytomX continues to enroll patients in PROCLAIM-CX-2029, a Phase I/II clinical trial evaluating this molecule as monotherapy in patients with solid tumors or with lymphomas.

With ImmunoGen, we continue to make progress on our probody drug conjugate targeting the highly expressed tumor antigen, EpCAM. And last but certainly not least with regard to our collaborations, research work continues on multiple targets in our broad alliance with Amgen focused on T-cell engaging bispecific probodies. The goal of this research is to use probody technology to more effectively target T-cell engaging bispecifics into solid tumors, an area where toxicity is proven to be a real challenge for the field due to the very high potency of these agents. The leading edge of this alliance is an EGFR-CD3 probody bispecific.

With these updates on the company, I'll now turn the call over to Robin for a brief review of financial highlights from Q1.

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Robin Knifsend, CytomX Therapeutics, Inc. - VP of Finance [4]

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Thank you, Sean. I would like to review selective financial highlights for the first quarter. We ended the first quarter with cash, cash equivalents and investments totaling $396.6 million compared to $436.1 million as of December 31, 2018. Our strong balance sheet allows us to fund operations well into 2021 assuming no new collaborations or financings.

Research and development expenses were $36.4 million for the quarter compared to $22.5 million in 2018. The increase in research and development expenses was primarily attributable to additional cost related to our maturing pipeline, personnel-related expenses and a $5 million charge for acquired technical know-how related to drug conjugate and bispecific technologies.

General and administrative expenses increased by $2.3 million for the quarter compared to the corresponding period in 2018 and was largely attributed to personnel-related expenses. Revenue during the first quarter of 2019 were $29.5 million compared to $14.2 million in the corresponding period in 2018. This increase was largely attributable to the acceleration of revenue from upfront payments relating to certain targets within the BMS alliance.

With that, I'll turn the call back over to Sean.

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [5]

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Great. Thanks, Robin. So now I would like to just briefly wrap up. From this recap of Q1 today, I hope you can see how across our wholly owned and partner pipeline we have a broad range of opportunities with very unique product candidates, enabled by our technology. And in addition to our pipeline progress during Q1, we also made several important additions to the senior organization, including Nick Galli as Chief Business Officer and Leslie Robbins as SVP, Intellectual Property. The additions of Nick and Leslie to our leadership team reflect our ongoing commitment to partnership formation and aggressive protection of our intellectual property as core pillars of our corporate strategy. Nick's proven track record in transformational business development and Leslie's broad and deep IP experience across discovery, development and commercial stages of biologic drug development will be great assets as we seek to maximize utility of our probody technology for patients.

I'm also delighted to welcome Elaine Jones back to our Board of Directors. Elaine recently retired from Pfizer after many years leading investments for their corporate venture fund. Elaine worked closely with CytomX in our earlier formative years. She is an accomplished life science industry leader whose broad experience across health care sectors and deep prior experience with CytomX will be a tremendous benefit as we continue to advance our innovative probody platform and clinical portfolio.

In conclusion, CytomX continued to make terrific progress during Q1. We further strengthened our leadership in the field of therapeutic antibody targeting with our Probody platform, we significantly advanced our clinical stage pipeline, moved our partnerships forward, and we further built our team.

We've finished Q1 with a strong balance sheet, and we look forward to a very productive 2019. Of particular note, our lead wholly owned programs, CX-072 and CX-2009, are taking great shape and we expect to provide detailed updates on next steps for the programs in the coming months.

So with that, I'll hand back to Chris for Q&A.

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Christopher S. Keenan, CytomX Therapeutics, Inc. - VP of IR & Corporate Communications [6]

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Liz, you can open up the call for questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from line of Christopher Marai with Nomura.

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Jackson Dean Harvey, Nomura Securities Co. Ltd., Research Division - Research Analyst [2]

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This is Jackson Harvey on for Christopher Marai. My first question is on CX-072 ASCO data. I realize you're going to update us on Part D. But I'm just curious, will this be in the same tumor types as you presented at R&D Day or will it be additional tumor types?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [3]

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It will be largely in the same tumor types with the potential for a little bit of additional information as well.

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Jackson Dean Harvey, Nomura Securities Co. Ltd., Research Division - Research Analyst [4]

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Got it. Also I have to ask if BMS has given you any indication of whether they may be sharing data at ASCO as well?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [5]

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They have not.

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Jackson Dean Harvey, Nomura Securities Co. Ltd., Research Division - Research Analyst [6]

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Okay. And my final question is on CX 2009. Can you share some more details on the dose refinement, what you might be looking for or the status of that, and also, the protocol for the ocular prophylaxis?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [7]

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Sure. Well, with regards to dose refinement, I think as we've reported previously, the mTPI cohort that we're enrolling, as of the last update, we were enrolling patients at the dose of 8 milligrams per kilogram. The way that particular component of the study is structured, it allows us to either further escalate or deescalate depending upon what we see at that dose. And so one of the advantages, of course, of doing this particular mTPI structure is that it gives us additional information on toxicity and overall therapeutic window over an extended period of doses as opposed to the simple -- the more typical 3-week DLT period within standard dose escalation. So there is a lot of information that we capture in the mTPI. We may only end up doing that at 8 mg/kg, we may end up at additional doses, we'll have to see how it goes, but the point, of course, is as you quite rightly point out is to dose range to allow us to select the optimal dose for Phase II.

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Operator [8]

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Our next question comes from line of Ying Huang with Bank of America Merrill Lynch.

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Alec Warren Stranahan, BofA Merrill Lynch, Research Division - Research Analyst [9]

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This is Alec on for Ying. My first one is on the Agensys acquisition. How do you see the conjugate linker-toxin and the CD3 bispecifics contributing to your current or future pipeline? Just trying to get a sense of how you view the assets you got from Astellas?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [10]

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Yes, certainly great question. So as you all know, for the first 2 probody drug conjugates that we put into the clinic, we made a very deliberate decision to use linker-payload constructs that were well understood and well presented from a clinical standpoint. And that's very important because as you can see from our interpretation of our 2009 data as we look to tease apart the safety data and attribute toxicity to either payload or potentially later target, we know exactly what we're looking for from the payload. That's an extraordinary helpful in really figuring out a reasonably complex Phase I data set for CX-2009. We -- and that's the DM4 payload. The payload for the 2029 CD71 PDC is MMAE, so we expect that to be a similar kind of situation.

With the third, the fourth, the fifth, just keep on going PDC that we put into the clinic over the next several years, I think we will now be in a position to take a little bit more risk on payload and maybe bring some novel payloads forward and we've got quite interested in this chemistry that we've acquired from Agensys, which we think has a lot of potential, is less proven in the clinic, but we would -- what we are evaluating is potentially putting molecules into the clinic with those payloads, which, of course, we now would own outright, but also not come with any downstream economic burden to any kind of partner.

With regard to CD3, there is a lot of work going on in the field right now. So I'm sure you know to answer the question what is the optimal CD-3 arm for CD-3 bispecifics and that can vary in terms of affinity, avidity, cross-reactivity, you name it. And so we've just been interested in building as big of a portfolio of CD-3 molecules as we can so that we can build large lead series to put into preclinical studies before we select molecules to put into the clinic, so that was just a somewhat opportunistic acquisition that's given us just another tool in the tool kit, if you like, for making CD-3 bispecifics.

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Alec Warren Stranahan, BofA Merrill Lynch, Research Division - Research Analyst [11]

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Great. That's really helpful. And then in terms of the overall cost of bringing those assets in-house, are most of the expenses that hit R&D accounted for this quarter? I guess, what I'm trying to get at is, should we see R&D expense go down to normal levels next quarter and onward?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [12]

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Yes, that's a onetime charge that you're seeing that we're taking that $5 million this quarter.

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Operator [13]

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Our next question comes from the line of Peter Lawson with SunTrust.

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Waleed Abdel-Naby, SunTrust Robinson Humphrey, Inc., Research Division - Research Analyst [14]

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This is Waleed on for Peter. A question on CX-072 combo study with vemurafenib. Can you give us an update on how the enrollment is progressing for that study and perhaps when we can potentially see some initial data?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [15]

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Yes, study continues, and we are -- we haven't yet decided exactly where we'll present data, but we are still actively considering sharing preliminary data from that arm before the end of the year.

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Waleed Abdel-Naby, SunTrust Robinson Humphrey, Inc., Research Division - Research Analyst [16]

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Great. And just do you have any additional perhaps clarity on when we may expect the expansion phase to begin for CX-2009?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [17]

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Well, we are certainly optimistic that we'll have that underway second half of this year. It really does depend, of course, on the ongoing dose optimization work we are doing and to some extent, as you can appreciate, as I commented earlier in the mTPI cohort, how much dose refinement we elect to do there. But we would -- we're certainly shooting to get that up and running second half of this year.

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Operator [18]

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Our next question comes from the line of Geoff Meacham with Barclays.

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Olivia Simone Brayer, Barclays Bank PLC, Research Division - Analyst [19]

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This is Olivia Brayer for Geoff. Just two quick ones from me. The first is, one, have there been any further developments in terms of CX-188 from a potential partnership perspective? Whether that's in the form of conversation with companies that have shown maybe initial interest on their part or maybe a more active approach on your end? Or should we be thinking about that as more of a down the road event if at all? And then just one on 072, recognizing it's still very early days, but can you give us a sense of what your internal discussions have been around registrational studies down the road and also maybe if you could help us better understand how you're thinking about the Zelboraf combination as far as pipeline prioritization goes?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [20]

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Hi Olivia. Thanks for the questions. I'll see if I can get all those. With regards to partnerships, on 188, I would kind of take a step back and say that if we think about the 072 program and our PD program as a whole, which would include PD-1 plus PD-L1 obviously we have some interest in time in potentially forming a partnership there, but can't comment on any specifics in terms of any ongoing discussions as I'm sure you will appreciate.

With regard to 072 registrational strategy, the strategy is to really play out the monotherapy expansions and again, we'll have additional data at ASCO, as I mentioned, where we're looking at this dose of 10 mg/kg in multiple tumor types to really get a fingerprint of how this monotherapy looks, best we can in the kinds of patients that we can enroll into these types of studies today. And then at that point, look at the data and evaluate the potential for moving into a full stage registrational study for the monotherapy in one or other of those indications. It, of course, will depend upon what we see. If we see robust enough data in any of those indications to drive into a single-arm registrational study, that would be one option, moving into potentially randomized studies could be another option. We're just going have to see what the data delivers for us around the middle of the year.

With regard to the Zelboraf combination, we continue to think that's an interesting experiment. We've been committed to that combination. It has taken some time to enroll. I would say the same thing. Let's see what the data tells us. The field has evolved a lot since we initiated that study. There is no question about it. So again, I don't want to make a specific comment on portfolio strategy, but it's not lost on us how much the field has evolved externally since we started that study and that may well read on decisions that we make in the future, but let's see what the data shows.

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Operator [21]

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Our next question comes from the line of Mohit Bansal with Citigroup.

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Mohit Bansal, Citigroup Inc, Research Division - VP and Analyst [22]

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Just wanted to understand, so the 3 programs which you're still under collaboration, how are you thinking about the future for those programs? Do you think there will be any partnership opportunity there as well?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [23]

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You're talking about the 3 targets for which research was stopped?

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Mohit Bansal, Citigroup Inc, Research Division - VP and Analyst [24]

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Yes.

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [25]

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Yes. Well, we'll see. I mean the targets will come back to us, which is great. I would say that, as you well know, the whole question of target selection in immuno-oncology has gone through kind of a transformation over the last 3, 4 years, and targets that were viewed as attractive a few years ago by leaders in the field such as BMS are viewed differently in many cases today for lots of different reasons it. And so those targets do come back to us, but we are not commenting at this stage on whether we plan to advance them or not. We certainly could, but we also have a ton of other stuff going on that we are excited about in our pipeline.

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Mohit Bansal, Citigroup Inc, Research Division - VP and Analyst [26]

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Got it. And then coming back to the PDC target, CD166 as well as 71, could you help us understand how, when you decide that this is the target we need to go after? What the process is? I mean, I understand that it has to be a target on cancer tissues. But I mean, like how do we make sure that this is the right target before actually getting into clinic?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [27]

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Well, that's a big question for the field isn't it, Mohit? But I'll give you my answer. No. To be serious, with regards to the PDCs, the way we've talked about this for the last 2 years is as follows: that it's a triage process. So we start with the most highly expressed antigens. We then look for the most highly expressed antigens across multiple tumor types. We then make antibodies to them, we conjugate them to payloads, we do in vitro assays to look at the ability of those conjugates to kill cells. Also as we move forward looking at the internalization properties of those antigens, which, of course, are vital for ADCs and PDCs to work, we then take them in vivo, we run a handful of in vivo models to look at the breadth of activity. And as we did this, several years ago, CD166 and CD71, kind of jumped out fairly quickly at us from the first triage that we did as very attractive and opportunistic targets, certainly when benchmarked against other ADC targets. So that's really been our process. We continue to run through additional targets where we are looking for, as I said, continue to work on the third, the fourth, the fifth PDC. We're following a very similar triage process. So that's been our strategy, but, of course, you never know until you get to the clinic.

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Mohit Bansal, Citigroup Inc, Research Division - VP and Analyst [28]

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Got it. And then last one, I mean, you did comment on -- a little bit on Amgen collaboration. So when can we see more from that side in terms of now they are getting to clinics or something like that?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [29]

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Yes, no guidance there at this point, Mohit. It continues to be researched. What I can tell you is that we're very well positioned with Amgen given that, they're obviously very, very strong in this field at the molecular biological level. We have -- we're pooling resources in terms of our molecular toolkits to -- including CD3 molecules, this was just assessed to build a wide range of different formats and molecules to evaluate in preclinical studies and it just takes time. So that's really all I can say at this point. But we are on the right track, the research is first class, the relationship with those guys is terrific and our decision to partner with each other, I think, has been very well received by both companies.

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Operator [30]

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Our next question comes from the line of Boris Peaker with Cowen.

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Boris Peaker, Cowen and Company, LLC, Research Division - MD and Senior Research Analyst [31]

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Great. So my first question is on 072. I'm just curious what biomarkers are you monitoring in these patients and have you observed any correlation between biomarker responders versus nonresponders?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [32]

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Boris, good question, important question. We continue to look at PD-1 status. We're not -- in the Part D in the expansions, we're not biopsying patients prospectively. So -- we did that as you know in the A2 arm, where we collected a good deal of translational data, including immune cell infiltrates, PD-L1 status, we looked at cytokine mRNA expression so on and so forth. In the -- the monotherapy expansions are really aimed principally at getting the efficacy fingerprint. So there's not going to be as much translational data so that's what all I can say at this point.

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Boris Peaker, Cowen and Company, LLC, Research Division - MD and Senior Research Analyst [33]

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Right. And for 2009, I'm just curious for the CD166 space in general, is there any competitive developments that you or we should be paying attention as investors, anything we expect at ASCO, outside of your programs?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [34]

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Nothing that we're aware of at this point.

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Boris Peaker, Cowen and Company, LLC, Research Division - MD and Senior Research Analyst [35]

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Right. And lastly, any -- I mean, you have seen a couple of partnered programs. Any timeline for potentially when we see results from those, any partner program?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [36]

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Well, ImmunoGen has presented some quite beautiful data on the EpCAM probody drug conjugate preclinically. That data looks very strong. With regards to clinical data, it's too early to tell and that's what all we can say at this stage.

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Operator [37]

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Our next question comes from the line of Joe Catanzaro with Piper Jaffray.

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Joseph Michael Catanzaro, Piper Jaffray Companies, Research Division - VP & Senior Biotech Analyst [38]

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Just two quick ones for me. Maybe the first one with regards to 072-ipi combo. How are you thinking about the indications in the expansion cohort of that trial? Did your plans have sort of go the route you've done a dose 072 and picked these checkpoint refractory-type tumors or pick indications were nivo-ipi has demonstrated clear activity or perhaps a mixture of both?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [39]

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Joe, great question. A very, very topical question at CytomX at this exact point in time as I'm sure, you can appreciate. We will be guiding on this as the year progresses. And the only thing I would say is that we are -- we're gearing up to do -- we want to make sure that the next step for this combination is a meaningful next step that will really show us what this combination can do. So I would just ask you to stay tuned.

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Joseph Michael Catanzaro, Piper Jaffray Companies, Research Division - VP & Senior Biotech Analyst [40]

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Okay. Fair enough. And then my second one. So It sounds like you could potentially get another look at 2009 data in 2019. Should we expect that to just be additional follow-up for the A2 patients or could we potentially see data from the dose-ranging portion of the study that's ongoing?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [41]

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Well, I think the -- obviously, for us, the main objective of the dose ranging work is to pick our dose for Phase II so once we -- which obviously we're going to want to communicate as soon as we can to you guys. To the degree that we'll be in a position to actually share the underlying data and whether we decide to do that at a medical conference this year or next year or at a more ad hoc basis, we're just going to have to wait and see. But for us, we're really focused on getting to a data set that will allow us to pick the dose and then move on. So we'll have to see.

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Operator [42]

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Our next question comes from the line of Robert Driscoll with Wedbush Securities.

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Ashiq Alim Mubarack, Wedbush Securities Inc., Research Division - Associate [43]

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This is Ashiq Mubarack on for Robert. Just a couple quick ones. I guess regarding CX-2009, how confident are you in the ocular profile being dose responses, especially in this mTPI cohort, any commentary there? And then just a quick second one on revenues associated with the Bristol-Myers collaboration. Any modeling thoughts for us for the next couple quarters?

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [44]

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Got it. So with regards to 2009 and ocular prophylaxis, I mean, we -- I think there's pretty good evidence from others and I think in our data as well that ocular toxicity for the DM4 payload is dose dependent. And in our study, we definitely pushed the envelope with the dose escalation. We were able to get to doses that were significantly higher than we had originally thought when we designed this Phase I study. We're not entirely clear why that is, whether it relates to some property of the probody or not. But to the effort, 9 mg/kg and 10 mg/kg doses was a little bit unexpected for us frankly, and not surprising that those doses, we see fairly significant ocular toxicity all the more so because we weren't actively prophylaxing patients in the early stages of dose escalation, so -- watching through most of dose escalation.

The literature evidence and the work that ImmunoGen has done and is reported has shown I think pretty clearly that steroidal eyedrops given appropriately with a high degree of compliance can actually be very effective in mitigating this type of toxicity. And we're using a somewhat similar regimen, but a further modified regimen based on consultation with our own consultants. So we're going to have to wait and see. We're optimistic. But it's going to also be a function, of course, of the dose that we actually end up picking for Phase II as well. So we'll know more as the year progresses. Second question on BMS revenues. We don't have any additional guidance at this point on revenue from BMS or actually from any of the other collaborations at this stage.

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Operator [45]

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Our next question comes from the line of Biren Amin with Jefferies.

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Biren N. Amin, Jefferies LLC, Research Division - MD and Senior Equity Research Analyst [46]

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Sean, maybe I can just start on 2009. When can we expect, I guess, an announcement on which tumor types you would go after with the Phase B portion of the study? And I guess, what would you consider in terms of just factors in evaluating which tumor types? I think you looked at 7 tumors in the Phase I portion.

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [47]

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Yes. Hi Biren. Well, let's just recap what we know so far as I mentioned in my comments. We -- as we shared at ASCO, we've seen evidence of activity for 2009 in a number of tumor types, which we know expressed target and they include breast cancer, ovarian cancer and head and neck. We've also seen, as you can see in the waterfall plot from the poster presentation at AACR, some activity in lung cancer as well.

It's still early days, of course, but our vision for the program has always been that it has the potential to be active in multiple tumor types and that does seem to be the case. What we're working through right now is for the expansion phase as we move into expansions in Phase II. Should we take a laser shot in one indication? Should we move into more than one indication? We haven't made that decision yet.

So as I said earlier on, I'm very much hopeful that we'll get through the dose ranging work in the coming months and be in a position second half of the year to pick dose and indication -- maybe there will be more than one indication and hopeful that will happen second half of the year, but that does require that we don't spend too long in dose refinement in the coming months. So a little bit of a moving target, but I think we have a lot of opportunity here.

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Operator [48]

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I'm showing no further questions in queue at this time. I'd like to turn the call back to Dr. Sean McCarthy for closing remarks.

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Sean A. McCarthy, CytomX Therapeutics, Inc. - Chairman, CEO & President [49]

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Well, thanks, everyone, for your time, I very much appreciate it. It's been another strong quarter for CytomX. We're super excited about where we are as a company and very much look forward to providing additional updates as the year progresses. So enjoy the rest of your day or evening.

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Operator [50]

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Ladies and gentlemen, thank you for your participation in today's conference. This concludes the program, you may now disconnect. Everyone, have a great day.