Good morning, ladies and gentlemen. Thank you for standing by and welcome to the Agenus Third Quarter 2020 Conference Call and Webcast. At this time, all participants are in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Dr. Jennifer Buell, President and Chief Operating Officer of Agenus. Dr. Buell, please go ahead.

Thank you very much, Cheryl. And thank you all for joining us today. Today's call is being webcast and will be available on our website with our accompanying slide material for replay. Before we start we'd like to remind you that this call will include forward-looking statements, including statements regarding our clinical development, regulatory and commercial plans and time lines, as well as time lines for data release and partnership opportunities. These statements are subject to risks and uncertainties and we refer you to our SEC filings for more details on these risks. As a reminder this call is being recorded for audio broadcast. I'm Jennifer Buell, President and Chief Operating Officer of Agenus. We're really delighted to provide an update today on our business. Joining me are Dr. Garo Armen, Chairman and Chief Executive Officer; and Christine Klaskin, Vice President of Finance. Now, I'll turn the call over to Garo to highlight our key accomplishments and plans.

Thank you, Jen, and thank you all for your participation in this call. Today, I will begin with a recognition of our team's resolve and commitment to deliver for our patients and their families. We have made excellent progress in advancing our lead programs, balstilimab and zalifrelimab to BLA filings and made important advancements with our next wave of innovations, which are in the clinic. This wave of innovations includes AGEN1181 our Fc-enhanced next-generation anti-CTLA-4 antibody; our differentiated CD137 agonist AGEN2373; AGEN1223, our intratumoral Treg depleting bispecific; and our allogeneic iNKT cell therapy for patients with cancer and COVID-19. These achievements have set us up for potentially transformative advances in the treatment and cure of cancers. In the beginning of this year, we hosted an R&D Day in New York. We outlined plans that would bring us to our first BLA filing for our lead molecules, while also advancing our novel pipeline of differentiated first or best-in-class molecules. We committed to share data readouts from six clinical programs this year. As promised, first having generated positive clinical data from bali monotherapy trial of 160 patients, we have initiated a rolling BLA filing with the FDA and paid the filing fee of approximately $2.9 million in the third quarter of this year. Second, we presented impressive data from our bali plus zali 155 patient combination trial. We are in discussions with the agency regarding a potential BLA filing on this one. Third we have generated clinical response data in our AGEN1181 Phase 1 trial. Additional clinical response data will be presented by Dr. Steven O'Day at SITC on November 14. We are particularly excited about this program. Fourth, clinical data from our AGEN2373 dose-escalation trial is maturing. We will provide an overview of these data at SITC and expect to present…

Thank you, Garo. As Garo shared, the productivity of our research and development engine is really profound. We're incredibly proud of what we've accomplished and what our teams continue to accomplish. If you look at our pipeline, you'll see more than 20 discoveries are listed with targeting very novel biology. You'll see that we've brought 15 of those to IND and now into the clinic. These are being advanced now in our own hands and in the hands of our partners. It gives us an opportunity to actually expand the breadth and reach of our science and our innovation. Here, at Agenus, we're advancing eight of these programs. And I should highlight that this efficiency is coming out of a company that is just over 200 employees, which is incredibly efficient. And the number of INDs, we've shared this with you before the number of INDs that we filed in the past four years has rivaled our largest competitors Bristol Merck Novartis others. So again, just to emphasize, all of the capabilities that we have in-house with a very efficient team, and now we're advancing eight of these programs in our own hands. We've already provided clinical updates to you on the first three of these programs so far this year, most recently at ESMO. Those updates included data on balstilimab our PD-1; zalifrelimab our anti CTLA-4; AGEN1181, our Fc-engineered next-gen CTLA-4; and during upcoming SITC in the next couple of weeks we're going to present an update on an additional four clinical programs and three very novel programs and platforms. I'm going to turn to ESMO and summarize some of the data that many of you maybe aware, but others may not. At the recent European Society for Medical Oncology, this is the ESMO meeting, Dr. Dave O'Malley. He…

Thank you, Jen. We ended the third quarter of 2020, with a cash balance of $114 million as compared to $62 million, at December 31st 2019. This compares to a cash balance of $79 million, at the end of the second quarter of this year. For the third quarter ended September 30, 2020 our cash used in operations was $32 million. Net loss for this quarter was $52 million or $0.28 per share and includes certain non-cash expenses of $18 million. This compares to cash used in operations for the same period in 2019 of $28 million and a net loss of $46 million or $0.33 per share, which included $9 million of non-cash expenses. Our cash used in operations for the nine months ended September 30, 2020 was $104 million with a net loss of $145 million or $0.88 per share, compared to cash provided by operations of $13 million and a net loss for the same period in 2019, of $81 million or $0.58 per share. For the nine-month period ended September 30, 2020, we recognized revenue of $57 million, which includes revenue related to the upfront license fee from our transaction with Betta, in addition to non-cash royalties earned. For the same period in 2019, we recorded revenue of $116 million, which includes revenue related to the upfront license fee from our transaction with Gilead, in addition to non-cash royalties earned. I now turn the call back to Garo, for his concluding remarks.

Thank you, Christine, and thank you Jen. So, there's a lot, as I've said in my last call. And you are wondering, how one will make money with all of this. And we of course are determined to embark on our strategy to build a highly, highly successful company, in our industry and beyond. And that's based on five important pillars. And I will go through them, one by one very briefly. Pillar number one, is to manage to continue to manage our cash position, relative to our cash requirements. As you can see from this quarter's report and our performance over the last few years, we have done this well, that is until we can bridge to an infusion of significant amount of cash, from either one or more transactions. And that's what we're working on diligently. So that's number one. Number two, very importantly, position our first-generation products with building of a commercial presence in order to optimize the revenues of these products and I'm talking about specifically bali and zali. And how do we do that? By bringing in a very competent first-class launch and commercial team which we have brought in a team from outside now that has provided us with a turnkey operation and are in the process of building our own team for our needs going forward. Now once we launch our first-generation products, we will optimize their revenue potential for the approved indications but most importantly beyond approved indications in combination with our products and as I explained before in combination with other products including non-I-O agents. Thirdly, embark on our strategy of sprinting towards approval for our pipeline of clinical products that in our opinion has very, very exciting potential in fact blockbuster potential. Among those included in that category as Jen described 1181 our next-gen CTLA-4 molecule. And also importantly are 2373 our CD137 antibody that we're starting to see some data on this that we believe will be particularly exciting when we start our combination trials with 2373; and also very importantly our iNKT cells. We believe iNKT cells work the way we expect them to work. The commercial potential of this modality is quite significant. Fourthly, we will continue to innovate with our pipeline soon to be in the clinic. They include AGEN1777 that is our TIGIT bispecific molecule and our also undisclosed myeloid cell-targeting antibody. We expect both of these molecules to be in the clinic next year. And lastly, we believe given the breadth of transactions and the breadth of molecules that we have partners -- we have partnered to third parties, we believe by helping them optimize their potential for products that we have licensed them we believe we can generate over time a cash annuity to fund our businesses. So with that, I will stop and turn it to the operator to see if there are any questions we can answer. Cheryl?

[Operator Instructions] Your first question is from the line of Mayank Mamtani.

Thanks for taking my question and great to hear so much progress across the pipeline including wholly owned and partnered programs. And congrats on the interest externally including from the investigator community at SITC and hopefully from your future partners. So I have a few questions. Obviously you've a lot going on. So for bali/zali combination filing, Jen could you speak to what we are sort of waiting there for? Is it duration of response, or is it longer term safety tolerability data in regards to your NDA filing? A – Jennifer Buell: Mayank I wasn't -- you said are we waiting for a duration of response? So we don't yet have the median duration of response achieved, but we -- this may take quite a bit of time. Patients are -- particularly with the combination are staying on therapy and they're having really quite lengthy and durable responses. So that won't hold us up from any of our regulatory issues with the combinations. That's just something that we'll follow and continue to report on.

I mean theoretically and practically the longer it takes for us to reach duration of response the better the patients are doing right?

Right. Right. Okay. So what would you say then is the gating step here? Is it -- you're just taking it sequentially given agency has a lot going on non-oncology COVID-specific stuff. So are you just taking it sequentially the two BLA filings? Is that basically...

That's right. There are a few reasons for that Mayank. And we have -- as we've mentioned we have some partnership activity with access to bali. It was -- it's a very straightforward filing. And just technically there was an opportunity to engage the agency develop our relationship with them through the monotherapy filing. The trials were run in parallel the data were collected essentially in parallel and the submission will be semi-parallel. So we're still in the preparation phase for the combination. There are some advantages to just pushing the balstilimab filing in this year as a monotherapy and in following. But we expect and we're in the process of speaking with the agency on the total package requirements et cetera that the combination will be just a couple of months behind the monotherapy.

Right. Great. Thanks so much for that explanation. So my next question kind of cuts across your multiple checkpoint programs for TIGIT and CTLA-4 also. So the importance of Fc engineering as you highlighted, the Fc depleted version of TIGIT for example is being looked at Gilead and AstraZeneca also started their Phase 3 study today. Like you said Merck and Roche have the Fc-competent. So maybe just talk to me about how you think about 1181? When we see that clinical data how much derisking it is to other programs that you have? And this entire concept of Fc-enhanced again conceptually makes a lot of sense, but just in the clinic as you highlighted there are different approaches that different companies are taking.

Let me just make a couple of general comments and I'll let Jen answer the rest of the question. But one thing that I think is important for everyone to realize is that there is a defined strategy of pursuing leads and programs that have an advantage over anybody else's agents. In other words, if we have a TIGIT molecule, the only way we justify advancing that molecule is if we can clearly demonstrate superiority over other molecules that we either internally generate that is we generate other molecules to test ours against or we procure it to test our molecules against. So unless, we can demonstrate that rigorously, we don't take programs forward. And so when we come up with leads such as 2373 or 1777, these have been validated by our systems including the use of VISION technology when applicable in order to justify our further investment to take it forward. We don't do it because a target is fashionable. So Jen, perhaps...

And maybe a few points, Mayank. So 1181 why did we choose the route that we chose? And we presented these data published them in cancer cell in 2018. And it was really sort of field shaking in that we're getting, we've had quite a bit of interest particularly in this molecule and the features have played out in the clinic quite well. And the differentiating features of doing the Fc enhancement versus other approaches like the afucosylated approach are a few folds and I'm just going to highlight. The most important is that through the Fc engineering the enhancement, we avoid complement-mediated toxicities. These are the hypophysitis and neuroendocrine disorders that actually have hampered. These are irreversible toxicities. We see them in about 15% of patients who are treated with first generation CTLA-4. And we very much wanted to be able to take advantage of all of the value of CTLA-4 which we know and its -- the data are out there. It's really the only molecule where we see the tail of the curve phenomenon in these long, durable, curative responses. So we wanted to be able to expand and broaden the population who could have that experience without some of these irreversible toxicities. Fc enhancement has allowed us to do that. And we have not seen any neuroendocrine disorders or toxicities in our trial to date. The other features of course though are to broaden the population of responders to those who may have a polymorphism in their CD16 allele and that's more than 40% of the population. Those patients do not respond to first generation CTLA-4, these are data presented by us and others and we are seeing responses with those patients on our trial, patients who have these mutations. So it's acting as designed. And…

That's great. I really appreciate the detailed explanation. So my last question if I may on 2373. As you know, you said you're thinking about combinations there. Could you just kind of share your thoughts based on what you've seen whether it's going to be a more traditional PD-1 combination, or are you also thinking CTLA-4? And my -- the second part to that question is, do you also record a payment from Gilead like you had from Merck for the ILT4 if this goes on to the next stage of development? Thanks so much for taking my question.

Okay. So maybe I'll -- so first with respect to the combination approach. And you've hit some very important points. And there's some science that's less well adopted by the community, but that we believe is really opportunistic. And that is -- that includes combinations beyond PD-1. Now that said, what we know with CD137 molecules that we've seen in the clinic in tumors like melanoma in lung cancer and others, we have seen that combinations with CD137 agonist and PD-1 have great value for patients. The problem has been the liver toxicity that we've seen with those other molecules, so the inability to safely dose or tolerably dose these molecules in combination. The design of our CD137 molecule allows us to get around that. We have not seen hepatotoxicity. So -- but we're not averse to a traditional -- more traditional combination to start it. We have a lot of data on balstilimab and there's a strong rationale for the combination with PD-1. That said, those combinations will essentially be traditional and base case in your words, and I agree with you, we will add on other very novel compounds that we can deliver and others cannot. And CTLA-4 is one really important complementary agent choose to CD137 agonist. And we've got some really impressive preclinical data to support some of the plans that we have for this molecule. And we'll be more public about it as we continue to expand this trial. The protocol amendment is underway. So you'll start to see the updates on what our clinical plans are with CD137 just in the next couple of weeks. With respect to the option programs, these have pre-negotiated financials with Gilead and I'll turn it over to Garo to highlight a couple of those points.

Sure. With regard to milestones for the balance of this year, next year and beyond, you can expect perhaps one milestone we would term that as a minor milestone this year from one of our partners. There will be -- the most significant milestone expected for next year will be the GSK $25 million royalty milestone. But in terms of transaction income for either balance of this year or next year, those will come from medium or large transactions that will be characterized as new transactions as opposed to from existing milestones. Those will be the more meaningful components of income for next year.

Fantastic. Appreciate the update. Thanks for taking my question.

Thanks, Mayank.

Your next question is from the line of Matt Phipps with William Blair.

Great and thanks for taking my question. Just kind of one for me. I'm just curious if in conjunction with the SITC meeting if you'll be able to start giving some more concrete plans for 1181. You guys have talked about a lot of different ways you can go with the next steps for that molecule and whether it's expansion in individual tumor types in the current trial or kicking off some Phase 2 trials? And then just again kind of balancing that versus advancement of zali, which I know you guys just hosted a trial in angiosarcoma. So, good to see that, but just kind of the balance of moving those two assets forward. Thanks.

Hi, Matt. Thanks very much for your question. 11 -- yes, the answer is yes. We will give more clarity. And I'll tell you a few reasons. We very recently met with our scientific advisory board. And just to reiterate they're on our website, but these are a really astute group of scientists that we're thrilled to be working with and it includes Mario Sznol, and Kurt Schalper, and Pat LoRusso, and Dan Von Hoff, Manuel Hidalgo, Steven O'Day real experts in drug development and specifically in immunotherapy development. And we went through all of the data the preponderance of data that we have to date. And we've actually agreed on the fact that we have a very active dose and a very active combination dose that we will now pursue with the trial that we believe will be designed to support a very rapid BLA filing. Our next wave -- our clinical expansion for 1181 will be very important for us and will be designed for -- to interrogate activity in a few different targets tumors of interest where we believe that we have a differentiated and superior approach in large market opportunities. So we will be disclosing these plans with you this year.

If there are no questions, Cheryl, we can promptly end the call. We are about nine minutes over.

There are no further questions at this time, sir. Are there any closing remarks?

Thank you very much everybody. I think we've covered quite a bit and we look forward to communicating all the excitement in the coming weeks, months and year.

Ladies and gentlemen, this concludes today's teleconference. Thank you for your participation. You may now disconnect.