Cellectis S.A. (CLLS) Q1 2020 Earnings Report, Transcript and Summary

Good morning, everyone, and welcome to the Cellectis’ First Quarter 2020 Results Conference Call. [Operator Instructions] Please be aware that today’s conference call is being recorded. I’d now like to introduce the first speaker, Simon Harnest, Cellectis’ Vice President of Corporate Strategy and Finance. You may begin.

Thank you, and welcome, everyone, to Cellectis’ First Quarter 2020 Corporate Update and Financial Results Conference Call. Joining me on the call today with prepared remarks are Dr. André Choulika, our Chairman and Chief Executive Officer; Dr. Carrie Brownstein, Chief Medical Officer; Bill Monteith, Executive Vice President, Technical Operations; and Eric Dutang, our Chief Financial Officer. Yesterday evening, Cellectis issued a press release reporting our financial results for the first quarter ended March 31, 2020. The press release is available on our website at cellectis.com. As a reminder, we will make forward-looking statements regarding financial outlook in addition to regulatory and product development plans. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found in our most recent Form 20-F on file with the SEC and in the financial report, including the management report, for the year ended December 31, 2019, and subsequent filings Cellectis makes with the Securities and Exchange Commission from time to time. I would now like to turn the call over to André. André, please go ahead. André Choulika: Thank you, Simon. Good morning, and thank you, everyone, for joining us today. Before we begin with our corporate update for the first quarter 2020, I would like to extend my heartfelt gratitude to everyone on the phone for your continued support of the entire health care space during these exceptional times. I would especially like to extend my highest appreciation to all health care workers, from the doctors to nurses who never gave up and are battling cancer and on the frontline, to our colleagues in the biotech industry and academic institutions, who are working day and night on the cure for all cancer patients. We, at Cellectis, keep our focus and never gave up a niche during these times. I’m proud to say that we are carrying a strong momentum from the start of 2020 through these recent weeks as all three of our proprietary allogenic CAR-T cell product candidates are progressing in clinical development and continuing to recruit patients. This would not be possible without the commitment and passion from each of our principal investigators, our clinical partners as well as our team at Cellectis. In parallel to our clinical progress, we have not stopped our R&D operations in New York and in Paris as well as the construction of our in-house manufacturing sites in Raleigh and Paris. It is now my great pleasure to introduce my esteemed colleague, Dr. Carrie Brownstein, our newly appointed Chief Medical Officer. Carrie brings to Cellectis her strong industry expertise and an impressive track record in clinical development across all phases of the product life cycle, including successful regulatory filing in the U.S. and the EU for novel products. Dr. Brownstein joined us from Celgene, where she served as Vice President, Global Clinical Research and Development, Therapeutic Area Head of myeloid diseases. Prior to Celgene, Dr. Brownstein, served as Executive Director, Clinical Science Oncology at Regeneron, where she led the team of investigating multiple early development program and assets, including T-cell engaging bispecific antibodies. Dr. Brownstein started her industry career at Roche as Senior Medical Director, supporting the development approval of a number of hematology and oncology therapies. Prior to her industry career, Carrie practiced medicine as a pediatric oncologist at the New York Presbyterian at Columbia University and Mount Sinai Medical Center. I would now like to hand the call over to Carrie for an overview of our clinical programs, then Bill will review our manufacturing update, and Eric will give an update on financials. Carrie, please go ahead.

Thank you, André. We are currently enrolling and treating patients with our proprietary UCART allogeneic CAR-T cell product candidates in three selective sponsors Phase 1 dose escalation studies: the B-ALL trial investigating UCART22 and relapsed/refractory B-cell ALL; the MELANI trial investigating UCARTCS1 in relapsed/refractory multiple myeloma; and the AMELI trial, investigating UCART123 and relapsed/refractory AML. As a reminder, each trial is planned to evaluate three to four dose levels of UCART cells in sequential cohorts of patients with the duration of each cohort expecting to be approximately three months due to the mandatory safety evaluation periods required by regulatory agencies. The primary objective of each Phase 1 dose escalation study is to evaluate the safety and determine the optimal UCART dose and corresponding lymphodepletion regimen that demonstrates safety. In addition to safety, we will explore CAR-T cell expansion, window of persistence and antitumor activity at different dose levels. Further, we will also evaluate the addition of alemtuzumab to standard cyclophosphamide/fludarabine lymphodepletion regimens, where applicable. At the time of this update, all three Phase 1 trials, AMELI-01, BALLI-01 and MELANI-01, remain on track. And we plan to share interim clinical data from these studies by the end of this year at or around relevant scientific conferences, provided new enrollment and the ability to conduct protocol assessment is not significantly impacted by the COVID-19 pandemic. Our partner, Allogene, in collaboration with Servier, is developing our licensed lead development program, UCART19, also called ALLO-501 in the U.S. for non-Hodgkin lymphoma patients. Allogene Therapeutics, in collaboration with Servier, recently announced they will present initial results from its Phase 1 ALPHA study of ALLO-501 in relapsed/refractory non-Hodgkin’s lymphoma at the American Society of Clinical Oncology, or ASCO, at the end of May. This oral presentation is the first data readout from this dose escalation study of ALLO-501. This Phase 1 study continues enrollment to optimize lymphodepletion. Our next license program to Allogene, UCARTBCMA, also called ALLO-715, is recruiting patients in the Phase 1 study called the UNIVERSAL trial, and Allogene announced they are planning on sharing an interim data update by year-end 2020. Our partner, Servier, has made the decision to temporary halt recruitment in the UCART19 clinical trials during the peak of the COVID-19 pandemic. We are excited to see this study reopen shortly and progress into Phase 2 based on the highly promising data that has been presented to date. With that, I would like to hand the call over to Bill Montes for an overview of our cell manufacturing program. Bill?

Thank you, Carrie. Regarding the supply of our UCART clinical product, we were able to successfully complete a series of manufacturing runs for all three clinical programs and ship to our clinical centers in the second half of 2019. This will provide the necessary vials to cover at least the dose escalation portion of our three ongoing Phase 1 studies. In parallel to our work with our contract manufacturing organizations for clinical development, we are continuing the construction of our in-house GMP manufacturing facilities in Paris and in Raleigh, and both remain on track for their anticipated go-live dates in 2020 and 2021, respectively. The Paris site is a 14,000 square foot manufacturing facility in Paris, France. This facility has been designed and is being constructed to produce critical raw and starting material supplies for our UCART clinical studies and potential commercial products. It is targeted to go live in 2020. The Raleigh facility is an 82,000 square foot commercial scale manufacturing facility in Raleigh, North Carolina. This site has been designed and is being constructed to provide GMP manufacturing for clinical supplies and commercial manufacturing upon regulatory approval. It is targeted to go live in 2021. In the near future, Cellectis will be able to provide a robust supply chain for its clinical and commercial manufacturing needs through these in-house manufacturing capabilities, in partnership with the existing CMOs. With that, I would like to hand over the call to our Chief Financial Officer, Eric Dutang, for an overview of our first quarter 2020 financials. Eric?

Thank you, Bill. Cellectis first quarter 2020 was driven by strong financials. The cash, cash equivalents, current financial assets and restricted cash position of Cellectis stand alone without Calyxt as of March 31, 2020, remained the same at $304 million compared to December 31, 2019. That reflects $28 million of proceeds and $5 million EUR5 million VAT received from Servier, which was offset by $29 million of net cash flows used in operating, investing and lease activities and $4 million of unfavorable Forex impact. This cash position will be sufficient to fund selective stand-alone operations into 2022. The consolidated cash, cash equivalents, current financial assets and restricted cash position of Cellectis, including Calyxt, was $351 million as of March 31, 2020, compared to $364 million as of December 31, 2019. The change notably reflects $13 million of net cash flows used in operating and capital expenditures activities of Calyxt. As announced in our year-end financial update in March 2020, we entered into an amendment to our license development and commercialization of agreement with Servier. Under this amendment, we granted to Servier an expanded exclusive worldwide license to develop and commercialize all next-generation generated allogeneic CAR T-cell product targeting CD19. That includes rights to UCART19, ALLO-501 and ALLO-501A, either directly or through its U.S. sublicensee, Allogene Therapeutics. With this amendment taking effect, we received and booked an upfront payment of $28 million, excluding VAT in Q1 2020. In addition, we regained exclusive control over the five undisclosed allogenic CAR T-cell target previously covered by the initial agreement and recognized $19 million of upfront and milestone payments received in the past related to these targets in our Q1 2020 revenue. The selective stand-alone net income attributable to shareholders of Cellectis was $27 million in Q1 2020, compared to a net loss of $10 million in Q1 2019. This $37 million increase in the net results between 2020 and 2019 was primarily driven by a significant increase in revenues and other income of $46 million, which was partially offset by an increase in operating expenses of $6 million and a decrease in financial gains of $3 million. The consolidated net income attributable to shareholders of Cellectis, including Calyxt, was $20 million or $0.47 income per share in Q1 2020, compared to a loss of $15 million or $0.36 loss per share in Q1 2019. The consolidated adjusted net income attributable to shareholders of Cellectis, excluding noncash stock-based compensation expenses, was $24 million or $0.57 income per share in Q1 2020 compared to a loss of $11 million or $0.26 loss per share in Q1 2019. Even more importantly, during this COVID-19 context, we are laser-focused to spend our cash at developing our deep pipeline of product candidates in the clinic and completing the construction of our state-of-art manufacturing facilities in Paris and in Raleigh in 2020. I will now turn the presentation back over to André for closing remarks. André? André Choulika: Thank you, Eric. 2020 is a pivotal year for Cellectis as we progress through the clinical development of our wholly controlled and partner product candidates. We are on track with our schedule and clinical development and are planning to provide an interim update on our clinical trials at the scientific conference by the end of the year 2020. Hand-in-hand with our clinical advancements, we are also on track with the construction of our in-house manufacturing sites which are designed to deliver full independence and internal knowhow at the forefront of science in gene editing and cell therapy. In addition to our lead clinical programs, we have made significant advances on the R&D side to further strengthen Cellectis’ position as a leader in the gene-edited cell therapy field. The Cellectis innovation team is constantly developing next-generation therapeutic product candidates that will be, as always, at the cutting-edge of gene editing and cell therapies. We are planning to advance next-generation products into clinical development in the coming years and will demonstrate the outstanding innovation power with our out-of-the-box thinking at Cellectis that has revolutionized medicine over the past 20 years. We’re thrilled to see our programs come to fruition as every day gives us new hopes for patients in critical medical needs. With this, I would like to open the call to any questions you may have. Operator, please go ahead.

Thank you. [Operator Instructions] Our first question comes from the line of Hartaj Singh with Oppenheimer. Please proceed with your question.

Great. Thank you for the question. André, everyone, and welcome to the new team members. I really appreciate the update there also. Can you just talk a little bit about how, once you get through dose escalation, how you will evaluate the dose you’ll be carrying into dose expansion? So how sort of NTV being evaluated? What are the criteria that will go into it? And then secondly, you’ve also mentioned a little bit about qualitative studies, you look at T-cell expansion, window persistence and tumor activity. Can you just talk a little bit about what we should expect to see in that regards when the data is revealed? André Choulika: Well, thank you very much, Hartaj, for the question. I think it’s a great question by the way, for you, Carrie, because, like you’re developing this. So Carrie, please, could you?

Yes, sure. So thank you for that question. I think it’s very – at this point, we’re not providing too much detail around what the exact parameters are going to be for making determinations. I think at this stage of the development, we’re really looking for optimal safety, optimal translational data and optimal activity of the cells. And I think we will be looking at all those parameters together to come up with an answer. So I’m not sure I can give any specifics to what that would look like when we choose what we’re going to move forward with for expansions in Phase 2 and 3.

Great. Thank you, Carrie. On just the persistence, do you think that some of the data you’re going to get through the end of the year will give you some insights as to potential for redosing? Or that’s still to be evaluated in the long run, not something in the short run?

Yes, sure. I think that’s a very important question. And again, I think by – we’ll have some data, including all those parameters I just mentioned towards the end of the year, and we will be able to figure out if we need to adjust lymphodepletion, whether it be the medications, whether it be the schedule to determine how we would move forward with redosing. But we’ll have some information, I think, in terms of what the window of persistence looks like by the – hopefully, by the time we are presenting our interim data.

Great. Thank you so much. Thank you for the question.

Thank you. Our question our next question comes from Biren Amin with Jefferies. Please proceed with your question.

Yes. Hi, thanks for taking my questions. So maybe if I could just start with the BALLI and AMELI studies. What are the criteria for each of those studies in order for you to move into dose expansion? And can you just maybe talk about the cell ranges that you’re dosing in the trial? And I guess, what would you want to see from both of those studies? And especially the UCART22, given, I think you’re also enrolling patients there with prior CD19 CAR.

Sure. I guess this is another question for me. So in the three different trials, I know you’re specifically speaking about the two leukemia studies, the doses are different of the CAR T-cells. So in the – if we want to start with the BALLI trial, the dose level one is 100,000 in cells per kilo; dose level two, 1 million; and dose level three is 5 million at this point. Again, I think the data that we’re going to be looking at, as I mentioned earlier, is the activity, safety and all of the combined translational data, so we can pick an optimal dose to move forward. I think that what’s interesting about the both leukemia studies is the regulatory bar, so to speak, for approvals in these areas are not terribly high. So we really just need to see what we see and determine if it – if we can move forward. These are both in – right now in relapsed/refractory patients who have no alternative therapies that typically, these diseases are only cured right now with transplant. And so achieving complete responses that are durable is critical, and that’s what we’d be mainly looking at for activity. I’m not sure if that answers your question.

It does. Thank you.

Thank you. Our next question comes from Gena Wang with Barclays. Please proceed with your question.

Thank you. So I have two questions. One is regarding the ALLO-501A study readout at ASCO and then second is regarding the manufacturing. So for the first one, we are now – we are waiting for the data in non-Hodgkin lymphoma, try to run more of anti-CD52 regimen. So just wondering maybe two parts of the question. Any differences between ALLO-647 versus alemtuzumab? And also regarding the dose, when we look at UCART19 study versus ALLO-501, UCART19 study is usually 1 milligram per kg for alemtuzumab, that translate to maybe 60 to 70 milligrams for adult patients. And for ALLO-647, ALLO-501 study at basically 39 to 90 milligrams. So it seems like the dosing being not much huge differences between ALLO-647 versus alemtuzumab. So just wondering what kind of the data you provide to design for your alemtuzumab cohort for CD22?

Yes. Gena, I can answer this, it’s Carrie. So I think it’s a really good question, the first part, for Allogene to comment on in terms of how they’re determining how to use their proprietary anti-CD252 antibody versus alemtuzumab. I agree with you that it’s unlikely that the doses would be terribly different because it’s a similar molecule. That said, I think as you pointed out, I think learning from their study and the doses that they’re using and what they see, and we’re all looking forward to seeing that data, would be very helpful in determining the appropriate way to move forward in our programs as well. But I don’t have any further insight into how or why Allogene is choosing the doses and choices that they had. In terms of our studies, I could say that we’re looking at adding in alemtuzumab. We are also looking at it without alemtuzumab because we want to find the most appropriate optimal lymphodepletion regimen to use with our UCART cells.

So for your profile? Sorry. Go ahead.

Okay. Just to add to that, this is Simon. If I may. So we’ve invented the CD52 knockout with alemtuzumab coinjection as the first measure to increase the window of persistence, and we strongly believe in that tool to use where applicable in certain patients. And I think where we are looking at is really an exceptional point in this CAR-T space because I think we’re the only company that actually makes that direct comparison of using alemtuzumab with Cy/Flu versus using Cy/Flu alone. So I think this year, a lot of the companies in our space are working on the correct lymphodepletion regimen. There is a lot of different tools available. But I would say that, at Cellectis, I think we’ll have one of the most insightful data sets coming out where we actually can use the site-by-site comparison. And it may be a good thing to do a longer window of persistence in certain indications, but it may be a better approach to have a shorter window of persistence in other indications. So this is what you’re trying to figure out in the dose escalation, and this will definitely give insight by the end of the year, and we will share much more detail around this in our presentations that are upcoming. But at this point, I think we’re keeping it mostly under wraps. It’s just because there are some moving parts, and the data will be very insightful. André Choulika: Yes. Thank you, Simon. Actually, I think that there is no actual study that have a comprehensive analysis of – with or without an alemtuzumab or preconditioning or biosimilar preconditioning. And I think that the study that we’re preparing and that will start initiating second half this year, will give you a pretty clear situation of the role or not of alemtuzumab, with or without. And it’s something that is very important to us. I think they did the guarantee of this type of therapy and allogeneic therapies and also autologous therapies. It’s most of the time in the quality of the preconditioning and consistency of the preconditioning. So it’s something that we’ll bring answer in there. I hope that there will be interesting to share.

That’s very helpful. And my follow-up – second question is regarding the manufacturing. So the Paris side and the U.S. side, just wondering, once they complete, what kind of capacity of the dose, if you can give a – of course, that depends on how many AL cells per dose. But if you can give a little bit a rough idea like how many doses of patient you can basically supply?

Yes. Thanks, Gena. This is Bill Monteith. So both of the facilities, as you said, how much the capacity is and what we can provide for and will need to provide for is going to be dependent upon once the final dose is determined. What we have done is built both facilities to be able to provide the starting materials in Paris for UCART production, and the UCART manufacturing capacity in the Raleigh facility to be flexible in terms of what they can produce, too. And that, in conjunction with our current CMO network, we feel we will have more than adequate capacity to meet any final commercial requirement once we get to that approval state.

Okay. Thank you.

Thank you. Our next question comes from Christopher Marai with Nomura. Please proceed with your question.

Hey, good morning. Thank you for taking the questions. I think, obviously, you’ll have a lot of data this year from you and your partners, and there’s an interesting perhaps, cross-trial comparison going on. So I’d like to understand a little bit about some of your perspectives on comparing some of the data out of the CS1 UCART trial and the BCMA trial with your partner there at Allogene and the kind of data you might be looking for to understand the applicability of each of those approaches in multiple myeloma patients and sort of different lines of multiple myeloma therapy. And then I have a follow-up. André Choulika: Well, thank you very much for this question, Chris. It’s really appreciated. I think it’s going to be really interesting because there are significant differences, I think, between the targets such as BCMA and the targets such as CS1. First, CS1, there is less soluble protein in the blood than BCMA. And the behavior of the CAR is going to be different because CS1 is – if there is less volume of protein, there is the – the protein that’s expressed on a lot of other immune cells, such as NK cells are also expressed on B-cells, expressed on T-cells, especially the PDA, and also expressed on macrophages and others. So what would be interesting to monitor is the depth of the lymphodepletion that is induced. We don’t – we cannot do alemtuzumab with CS1 because we have already two knockouts. Knockout of TCR alpha and the knockout of CS1, and we didn’t include the third knockout, which would be the knockout of CD52 because we thought that potentially CS1 can have the same effect at CD52 in deepening the link of depletion by knocking, like by destroying T-cells, especially CD8, and also a bit of CD4 because we expect a bit of CS1 and NK cells also. And that would also give a kick start for CS1 to start expanding in the patient. So the quality and the way you do lymphodeplete the patient at start will induce probably this type of expansion. And that’s totally different than what you would see at BCMA, because BCMA, as the product is quenched by the soluble protein, it’s like you have to add – like the dose might be different because you have to have add an access in order to have like a trigger in order start the expansion. The other thing that is interesting is also the level of expression on multiple myeloma cells with CS1 where we do have a response with alemtuzumab, while with BCMA, we don’t have an active monoclonal antibody. And so it’s a clean new target for CAR-T and alemtuzumab is not that much use, it’s more DARZALEX or daratumumab that we use really for monoclonal antibody, then BCMA CAR-T or we will – or bi-spec. So we’re – it’s quite a clean target for us, and it’s going to be really interesting to see how it performs without alemtuzumab in this case, and if the deep [indiscernible]. We’re still in the first dose levels, and it’s going to be interesting when we expand into higher doses in the future.

Okay. And then it sounds like, obviously, lymphodepletion is going to be the biggest component of the comparison, at least upfront, I suppose, the other component would be response rate between the two trial settings. How much do you expect to be able to read through to sort of durability of response? And then I guess, piggybacking on that question and applying that to all of your ongoing studies. As you move to your expansion phase, I was wondering if you could elaborate on any contemplation to extend these expansion phases of the trial to include redosing? And what might the criteria for redosing look like in, call it, dose expansion phases?

All right. So I hope I remember the first part of the question. So I think let me start with the first part of the question about the design of the trials and versus in myeloma for CS1. I think it’s really important to recognize, though, that another huge component of having a different target is that the BCMA space is very crowded. So not just with CAR T-cells, but also with bispecifics, ADCs and all other technologies that can target myeloma with BCMA. And I think having something different is a huge improvement and something to leverage on because we don’t know if patients, once you’ve been treated with one of these BCMAs, other programs, other technologies, let’s say, if you relapse whether or not a BCMA-targeting drug would still be applicable to those patients. So it really gives an opportunity, not only for another cell therapy to work after, let’s say, someone got a bispecific or an ADC first. So I think it really puts us in a very positive space and is something we can leverage on that will be very helpful for patients. So that I think is the first part of the question. And then in terms of redosing and the expansions, I mean, I think absolutely. I think, to me, and when I do clinical development, the whole idea of expansion phases once you find your safe and optimal dose to move forward is to explore all those things that you mentioned. So whether we’re going to explore specific indications or specific segments of the population as well as redosing different ideas on lymphodepletion so we can find the most optimal way to move forward. And as you know, in the space of relapsed/refractory disease where patients don’t have alternatives, sometimes if you see extraordinary data, these types of expansions that may include more patients and find alternative opportunities can move forward towards regulatory approvals. So I think to your point, absolutely, that to me is the point of the expansion.

Okay. Thank you very much.

Thank you. Our next question comes from Michael Schmidt with Guggenheim. Please proceed with your question.

Hey, guys. Thanks for taking my questions. Just going back to the three ongoing studies, maybe a question for Carrie. So obviously, appreciate the fact that these are actually ongoing at the moment. Can you just maybe provide a little bit more detail sort of how far into the dose escalation you are in each of the three studies? And then just to clarify how alemtuzumab is used there, whether that is something that is used since dose one or something that I think André mentioned maybe adding that in the second half of the year?

Sure. I can start by saying that all three programs are pretty much in lockstep with each other. We have cleared our first dose level for all three programs and are now exploring our second dose level. And I think, as you well know, the trials are designed to have three dose levels and one of them four dose levels. In terms of alemtuzumab, we, as André pointed out earlier in his responses, I think it’s important to understand what alemtuzumab adds to the equation because it doesn’t – we don’t know for sure if that’s actually the best way to go. So I think our approach where we will be looking at it with and without is critical, and I think is a – we’re really the only ones doing it, and we’ll learn what is appropriate because as was earlier said, it may very much depend on the indication. There are indications, for example, like AML, where you may want to get in and get out with a very acute strike on your blast because you do not want to cause prolonged myelosuppression and potentially lead to more infectious types of toxicities, whereas in other diseases, potentially in ALL, it’s not as much of a concern. So it’s critical that we look at both strategies and decide for each type of disease and indication what works best. So we will – we’ve already amended the CD22, the UCART22 trial to add in alemtuzumab, and we will be looking at that data. And we will likely be doing the same at some point for the AML study as well. And I think as André earlier said, for CS1, it’s not an option due to the fact that we don’t have the CD52 knockout. However, CS1, on its own, may actually add additional lymphodepletion due to the fact that the T-cells actually are also CS1 expression.

Yes. That makes sense. And then maybe a question around the Servier, the amendment to the Servier agreement that was announced earlier this year. I know there were five targets returning to Cellectis. I was just wondering if there had been any work ongoing by your partners around those targets that you could leverage? Or whether these were purely reserve target for future development? André Choulika: Well, it’s a good question, Michael. Yes, so there is work that – look, we don’t want to disclose the targets currently because it’s – well, everyone’s copying everyone. Plus, I think they are like great targets in there. And yes, we have done a lot of work actually. Still preclinical work, but we will definitely bring this one. So we’ll present the current clinical data after this. We’ll have plenty of things to show you. But for now, we would like to give the attention of everyone on our clinical data because we’re super excited about that. And at the time, we’ll bring this issue for at least one target that we’re excited about, and there is plenty of interesting things that will be shown. No, it’s not plainly just like targets like that.

Yes, sounds good. And then good to see your U.S. patent now also granted around the CRISPR-edited T-cell therapies, and I was just wondering if you could just help us understand a little bit what the scope of that patent is and whether and how that might potentially be enforceable in the future in the U.S. André Choulika: So we’re convinced that this patent is enforceable. It’s a patent that we filed early in 2013, like March 2013, and I think that no one have heard like the word CRISPR at this time. Well, Cellectis has been very much at the forefront of what was happening at this time in gene editing. And we jumped on this as we’re already working on T-cells and CAR T-cells. We just implemented this technology in CAR T-cells and target playing with CRISPR in there and file patents. We consider that this patent is a very solid patent. It’s kind of a replicate that we had with Merck and was challenged and locked. So it gives you an idea to how strong it is in terms of par art that have been tried to be leveraged at this time. The moment that CRISPR just came out in December 2012, and March, we filed this first patent after the year at CRISPR in T-cells. And we are a very open company in terms of licensing. And however, we will definitely protect our IP. It’s our fiduciary duty to do this. And we will also – but we have being always very open company in terms of partnership, licensing and working with third-party companies even in our space. So it’s a technology that is very important for the company, and we’ll definitely use it due to the IP.

Okay. And then just maybe one more, if I may, and this is something I think that has talked about in the past, but some of your competitors are looking at other alternatives to provide an environment in the body for the allogenic T-cells to give up a window, such as, for example, the B2M knockout. And I was just wondering your general thoughts on that, that approach and if that’s something that you might be evaluating potentially in the future as an add-on or alternative as well? André Choulika: Well, B2M as an approach that Cellectis has talked about very, very rapidly. It was an arbitration between CD52 and B2M, two technologies that Cellectis has been very upfront, like even at the time we’re working on meganucleases back in, like more than 10 years ago, it was an obvious target. The CD52 felt more secure at the injection of fuel UCART19 at this time, or ALLO-501 for the simple reason that we were concerned a bit by the attack of NK cells. And when you do a lymphodepletion, you see that the lymphodepletion is longer on T-cells and the NK cell pick back a bit more quickly. So we said, okay, let’s stay on the safe side and that on CD52 at first, and it would give us – it would enable the concept of allogeneic CAR-T at this time. That was back like five years ago when we’ve done the first patients. We thought about using B2M, but we have this alternative on trying to block NK cells by using an NK blocker, which is HLA-E. So replaced by gene-editing beta-2 microglobulin by HLA-E. HLA-E blocks NK cells. So we have like great scientific data that’s showing this. Now we’ll probably show more data, and it’s something that we’ll probably bring in the future to – in the clinic. Now we’re super excited to see – the interesting thing, like, Michael, the interesting thing, what I see is there are like series of trials on 19. No like cyclo/fluda alone. You have one trial cyclo/fluda alemtuzumab, and you have one with beta-2 microglobulin. All ongoing currently today. And by the end of this year, I hope by ASH, we’ll have data that will like reveal to us on the same target, which is CD19, all these approaches, and it would be interesting to see, to compare all these data. So far, the one that has been proven very efficient on the long-term, it’s persistence with the CD52 approach that we partnered actually with Servier and Allogene, and we’re very excited about that. But I’m very curious in seeing the other no CD52, no beta-2 microglobulin or, there’s microglobulin, and we’ll compare all of this. So it’s going to be a key year for the ALLO space to understand how this works. And Cellectis has all these options, including the replacement of beta-2 microglobulin by HLA-E. It would open interesting years in the – like for 2021, 2022, et cetera.

Great. Thank you, André. I appreciate it. André Choulika: Sure. Thanks.

Thank you. Our next question comes from Jim Birchenough with Wells Fargo. Please proceed with your question.

Hi, guys. Thanks for fitting me in. Just a few follow-up questions. I guess, first, just thinking ahead to ASH, if that ends up being the form for data. Do you think by year-end, we’ll have, based on the cadence at sites that you’re seeing right now, data in dose level three, or dose level four in the case we’ll go fourth dose level? Or just trying to get a sense of your visibility on enrollment and whether we’ll get to those higher dose cohorts.

Yes, it’s Carrie. I can answer that. So I think you just have to back up one minute and remember that it’s not so much about the cadence of enrollment, because in the Phase 1 studies, as I mentioned earlier, our time frame for enrollment is way more based on the fact that there’s mandatory safety times for watching patients before the next patients can be enrolled per most – the regulatory guidelines that have been imposed on the study. So I think that while we haven’t seen any issues with enrollment and there is a tremendous interest and they’re prioritizing our studies, I think from the perspective of how many dose levels we’ll get to by then is really going to be more based on the fact that we have to wait with mandatory waiting periods in the protocol. I can – the second piece to that as well is, as you well know, the abstracts are due in August. So I don’t believe there’s time for information in the abstracts for dose levels past dose level two That said, by December, if we’re able to put it all together, there’s a possibility of seeing more advanced dose levels by some presentation in December, but not necessarily in an abstract form due to the fact that they do so early.

And then Carrie, just in terms of understanding the incremental benefit of alemtuzumab, if there is an incremental benefit. Is that something we’ll understand before cohort expansion? Or is that something that’s going to be continued to be evaluated during the cohort expansion?

Yes. That’s a very good question. I think it’s very dependent on what we see. So I think in the dose escalation portion, we are going to include, I don’t know, an arm, let’s say, of using alemtuzumab. However, we may also continue to tweak, let’s say, how we give the dose and how we potentially give it if it turns out to be where we want to move forward on any expansions as well. So I think there’s a combination to that question.

Maybe just one final question for André. Just when you think about leveraging your gene-editing platform, André, is there any thought to moving beyond CAR-T and into other gene-edited cell approaches even for rare disease? What are your broader thoughts, if any, beyond the CAR-T space? André Choulika: It’s a very good question. And yes, we are working on – outside CAR-T, outside oncology. It’s something we’re preparing. We are focusing all our attention in the clinic, regulatory, manufacturing, et cetera, on our CAR-T effort because we probably believe that these products are going to go far. But the R&D, the preclinical team, et cetera, are preparing the next-gen, not only CAR-Ts, not only in solid tumor, but outside CAR-T, outside oncology for gene therapy purposes. And we definitely will do a time presentation for this. But as said previously, we would like to first provide a pretty comprehensive set of data in our current clinical trial to be presented and continue to focus on this for now, and the attention also of all the company on these trials. And then we will unravel what has been cooking inside selected R&D for the past years that, I think, is really, really interesting.

Great. Thanks for taking the questions. André Choulika: Thank you.

Thank you. Our next question comes from Yigal Nochomovitz with Citi. Please proceed with your question.

Hi. Thanks. I just have a question about lymphodepletion. How concerned are you about that regimen in light of the COVID-19 pandemic? And what are the study sites and investigators doing with respect to handling that?

Yes. I’m not 100% sure I understand. So you mean in terms of giving lymphodepletion regimens in the context of patients being at risk?

Yes.

Yes. I mean, I think that’s – it’s an important point. I think, however, we have our sites – we need to continue to move forward with our programs for the good of patients with these rare, untreatable cancers, and we need to continue to do the science that needs to be done to make sure that, in the future, we have new therapies for them and new safe therapies. So I think from that perspective, we need to continue to move forward. That said, we are open in sites that – across the country and in the U.S. and therefore, depending upon the site, they have different requirements at their institutions on how to make sure they’re ensuring patient safety. So I don’t see, at least up until now, we haven’t seen that being an issue. And again, safety is paramount, ensuring patient safety, and the physicians are really checking and enrolling patients that they think are appropriate for the trial and using all of their appropriate measures in their institutions to ensure that patients are safe. I’m not sure that.

Okay. Thanks. And just a question on the recent patent for using CRISPR-Cas9 for allogeneic CAR T-cells. Can you talk a little bit more about the relative advantages and disadvantages of CRISPR versus TALEN and – for CAR T-cells? And when you would pick CRISPR or TALEN to engineer a development candidate? André Choulika: Currently, when we started using CRISPR in T-cells back in 20 – like early 2013, started January 2013, and it worked really well in our hands. And at the same time like, to the TALEN where – also new technology. And we’re comparing together homing endonuclease, meganucleases, megatal, that Cellectis has also developed. We’re comparing also this with TALEN and CRISPR. And we’re very much technology-agnostic in general. And CRISPR worked really well in our hands at this time. The thing that we struggle is to do knockout. For example, a T-cell, at this time, we had a bit of difficulty with handling the off targets with CRISPR, especially. And so believe that there is a bit of difficulty. It didn’t work as well as we thought in using CRISPR for homologous recombination, at least it was what’s called one-side homologous recombination. It means one piece, like one arm of the DNA was recombining correctly. The other arm was not recombining correctly because CAS didn’t – as fast on one side of the DNA than the other. So you had illegitimate kind of homologous recombination to the gene replacement in there. And we struggle a bit with this. So we started more focusing on TALEN that were more reliable at this time and very much are using CRISPR in R&D to try to develop quick ideas of stuff like this, just combine the things together and have a quick idea of how, it depends if you want to do screening or stuff like that to fine-tune. We hope that this technology will improve safety, and we might file an IND at a time. I know that other companies have filed already IND with CRISPR, and we’re pretty excited about that. And we remain very open to discussing with them. However, on our side, it’s not, on a short-term, that we believe that this will lead to, like on the safety side, what we observe with the TALEN so far.

Okay, great. Thank you very much.

Thank you. Our next question comes from Raju Prasad with William Blair. Please proceed with your question.

Thanks for taking the question. Maybe just wanted to clarify, as far as FCA versus FDA, I guess, what types of things you plan on learning that weren’t clear from the UCART19 trial? And can you just comment a little bit on cell kinetics as it relates to the memory cell phenotype of your current products? And how that might play a role in durability versus lymphodepletion?

I can. This is Carrie. I could start with the first part of the question and then maybe André can answer the rest of the question. But I think that it’s important to understand that this is a different situation than in the autologous space. So we don’t know yet, even for durability purposes, if we even want durability, right? So I think the really important question in my mind is to understand what lymphodepletion and of level of T-cells that we want to deplete in order to get a strong acute attack on the cancer cells. The piece that’s, I think, really special about our technology and about the ALLO technology is the fact, that was brought up earlier, that we could redose if we need to. And so this idea of needing to have a very long durable lymphodepletion is not necessarily applicable to the ALLO space. However, you want enough so you can have an acute attack. And I think also, it will depend on the disease. As I said earlier, in some diseases like AML, you may not want to have a very long lymphodepletion because these patients may end up significantly myelosuppressed and lymphodepleted, and we already know they’re at higher risk, which was also brought out for resurgence of viral infections and other things that they’ve had in the past. So it’s really going to be dependent. And what’s beautiful about the technology and beautiful about our approach is that we’re going to try to learn as much as we can about all of these methods, and that we can then tailor the approach later appropriately for the individual indications as well. So I think that we’re going to learn a lot about what other programs are doing in other companies in terms of their regimens and what their window is of lymphodepletion, and we’re also going to learn from our own, and you take all that together to make the appropriate decisions for individual indications and studies. And then, André, maybe you can speak to the memory CAR T-cell piece that was requested. André Choulika: Thank you, Carrie. It’s a very good question. It’s like really central, central memory. But the fact is that we monitor very closely the composition of every vial we produce in terms of memory cell, central T memory, et cetera, the gamma, delta, everything that is in there. And this is something that we consider as the most important in terms of QC. People are wondering very often why we take so much time to, like, I don’t know, it takes like close to four months, though, just correct me if I’m wrong, to cure treated cells. And we take our time to cure treated cells for up to the time we’re sure that we have a reproducible production from batch to batch. So after this, there’s a very deep translational work that is done to understand the cells that we inject in patients, how they behave, how they expand, et cetera, in order to have a clear understanding of what is working and what is not working in the vials that we produce, knowing that all the information that we get from autologous therapies is quite confusing sometimes because the raw material, which are the T-cell, always come from the patient and the quality is not reproducible from patient to patient. Here, our goal is trying to have consistency in the production. And this has to – at least you have to know exactly what you have in your vial before you get started, once this is injected. And you appreciate the way the cell has behaved in the patient, what expanded, what did not expand, et cetera. Then you can have a real feedback to improve after the production, and the consistency is, after this, often the most important, because you have to give always the same chance to every patient that receive the vial that comes out from the production.

Thank you. It appears we have no additional questions at this time, so I’d like to pass the floor back over to Mr. Harnest for any additional concluding comments.

Thanks, Betty, and thank you everyone, for being on the call today. We really appreciate your attentiveness to our story. This is going to be an extremely exciting year for us and for the cell therapy space, in general. And again, we’re really thankful of all your support of the health care space in these special times. And we’re excited to make progress and really serve patients in need. If you have any other follow-up questions, feel free to e-mail me at simonharnest@cellectis.com and reach out any time. Thank you very much.

Ladies and gentlemen, this does conclude today’s teleconference. We thank you for your participation, and you may disconnect your lines at this time.