Good afternoon. We will begin the MacroGenics 2020 Fourth Quarter and Full Year Corporate Progress and Financial Results Conference Call in just a moment. All participants are in listen-only mode at the moment and we will conduct a question and answer session at the conclusion of the call. At this point, I will turn the call over to Jim Karrels, Senior Vice President and Chief Financial Officer of MacroGenics.

Thank you. Good afternoon, and welcome to MacroGenics' conference call to discuss our fourth quarter and full year 2020 financial and operational results. For anyone who has not had the chance to review these results, we issued a press release this afternoon outlining today's announcements, which is available under the Investors tab on our website at www.macrogenics.com. You may also listen this conference call via webcast on our website where it will be archived for 30 days beginning approximately two hours after the call is completed. I would like to alert listeners that today's discussion will include statements about the company's future expectations, plans and prospects that constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our annual, quarterly and current reports filed with the SEC. In addition, any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our views change except to the extent required by applicable law. And now, I'd like to turn the call over to Dr. Scott Koenig, President and Chief Executive Officer of MacroGenics.

Thank you, Jim. I'd like to welcome everyone participating via conference call and webcast today. This afternoon, I will provide key highlights from our clinical programs. But before I do so, let me first turn the call back to Jim who will review our financial results for the year.

Thank you, Scott. This afternoon, MacroGenics reported financial results for the year ended December 31, 2020, which highlight our financial position as well as our recent progress. As described in our release this afternoon, MacroGenics total revenue, consisting primarily of revenue from collaborative agreements was $104.9 million for the year ended December 31, 2020, compared to $64.2 million for the year ended December 31, 2019. Revenue recognized during the fourth quarter ended December 31, 2020, included $40 million in milestones from Incyte and a $20 million upfront payment from Janssen, the latter of which was not reflected in our cash on our December 31, 2020 balance sheet as it was received in early 2021. Our research and development expenses were $193.2 million for the year ended December 31, 2020, compared to $195.3 million for the year ended December 31, 2019. General and administrative expenses were $42.7 million for the year ended December 31, 2020, compared to $46.1 million for the year ended December 31, 2019. This decrease was primarily due to a decrease in external costs, including consulting fees. MacroGenics’ net loss was $129.7 million for the year ended December 31, 2020, compared to a net loss of $151.8 million for the year ended December 31, 2019. Our cash, cash equivalents, and marketable securities balance as of December 31, 2020 was $272.5 million compared to $215.8 million as of December 31, 2019. Again, the $20 million upfront from Janssen as well as the recently disclosed $10 million milestone from Incyte was not reflected in our cash balance at year end. Finally, let me mention a few things about our cash runway. Earlier this year, Provention Bio announced the FDA’s acceptance of their BLA for Teplizumab for the delay or prevention of clinical type 1 diabetes in at-risk individuals. The PDUFA target action date is July 2, with an advisory committee meeting tentatively set in May. You recall that we had earlier developed and sold Teplizumab to them in 2018, and if approved, MacroGenics is entitled to receive a $60 million milestone as well as royalties on sales. For cash budgeting purposes, we typically discount such milestones as we have no control over them. With that background, there is no adjustment necessary to our previously disclosed cash guidance; and to remind listeners, we anticipate that our cash, cash equivalents, and marketable securities as of December 31, 2020, combined with anticipated and potential collaboration payments should enable us to fund our operations into 2023 assuming the company's programs and collaborations advance as currently contemplated. And now I'll turn the call back to Scott.

Thank you, Jim. 2020 was a big year for MacroGenics with the presentation of various datasets across our portfolio at most of the major oncology conferences, including AACR, ASCO, ESMO, SITC, San Antonio, and ASH as well as the approval of MARGENZA as an end-year holiday gift. Still, we are equally, if not more excited about our prospects in 2021. We are particularly excited about the multiple ongoing registrational or potentially registration enabling studies, including Flotetuzumab in AML and margetuximab in gastric cancer, and this is an addition to two PDUFA target action dates in July related to Teplizumab and Retifanlimab. And finally, we know many of you eagerly await clinical data from multiple dose expansion or proof-of-concept studies including the next phase of data from MGC018, Tebotelimab, and MGD019. With that backdrop, let me use this time to walk you through updates on our portfolio of eight clinical molecules. First, let me provide an update on margetuximab. In December, the USFDA approved MARGENZA in combination with chemotherapy for the treatment of adult patients with metastatic HER2-positive breast cancer who have received two or more prior anti-HER2 regimens, at least one of which was for metastatic disease. The anticipated March launch is being coordinated with our commercial partner, EVERSANA. They are a pioneer of next-generation commercial services to the global life sciences industry, and we intend to leverage their integrated commercial services to efficiently launch MARGENZA. We have been working closely with EVERSANA to fully align our commercialization strategy to distribute product, educate healthcare providers, and ensure patient access to margetuximab, while maintaining MacroGenics cash runway to fund our broader portfolio. As disclosed in November, under the terms of our agreement with EVERSANA, we maintained full ownership of margetuximab including all manufacturing, regulatory, and development responsibilities for the product. EVERSANA…

[Operator Instructions] Our first question comes from Evan Seigerman with Credit Suisse. Your line is open.

Hey guys. Thank you so much for taking the question. Congrats on all the progress last year, and I am looking forward to this year. So, on MARGENZA and gastric from the Module A, what did you see in those patients that prompted you to submit the data to a meeting in this half of the year? And can you just remind us what you wanted to see from this trial overall? And if the data for Module A would be potentially sufficient for some sort of accelerated approval?

Thank you, very much Evan for your nice comments. So, we’ve achieved enrollment of the first part of Module A, which was 40 patients. Some of these patients have been enrolled quite recently. We have been able to follow up at least two scans on a significant number of those patients. And so, we felt that it would be valuable to begin to report on the results. And so, we’ve put a placeholder abstract into ASCO, and if it’s accepted, we will likely provide an update at a later cut of the data in the spring and be able to provide you the insights on the results of the study. As you recall, the basis for our interest in frontline setting was set by the study we conducted in second line setting of gastric cancer. These are patients post HERCEPTIN and chemotherapy where they were treated with margetuximab and anti-PD1, where we saw very nice objective responses in this population, and particularly what’s notable is the overall survival benefit which was superior to patients both in the second and first-line setting. Also, the safety data was dramatically better both in cases of patients treated with therapies in first-line and second-line setting by historical data. With that, to give you a perspective, the frontline treatment of patients’ standard of care is HERCEPTIN and chemotherapy based on a study called TOGA. In that study, the overall response rate was 47%. There was a 68% grade 3 adverse event observation in that study. So, with that, we obviously at a baseline would like to see overall response rates greater than 47%. We have internal goals obviously set which we have not disclosed publicly, but so far we’ve been quite encouraged by the data that we’ve seen today.

Great. Thank you.

Thank you. Our next question comes from Jonathan Chang with SVB Leerink. Your line is open.

Hi guys. This is David Ruch on for Jonathan. Thanks for taking our questions and congrats on all the progress last year. First question is, just could you help set expectations for the updated MGC018 data in mid-2021 in terms of how many evaluable patients from the different expansion cohorts? And then with regard to the prostate cancer cohort, how many patients do you expect could be RECIST evaluable?

David, thanks very much for the question. As you know, we have advanced forward expansion studies of MGC018. We decided after the ASCO Conference and based on additional analysis of pharmacokinetics of the drug and evaluation of safety that a 3 mg per kg dosing was the go-forward dose that we wanted to take in these expansion cohorts. We set a goal for enrolling 40 patients in castration-resistant prostate cancer, 20 patients with non-small cell lung cancer, and 20 patients with triple negative breast cancer. We obviously had to submit amendments for the various protocols, and it took several months to achieve that. That was reached in October, and we enrolled the first patient in November in the prostate study. During Christmas, things slowed down; and now, at the beginning of the year, we are now on a nice ramp of enrollment of patients. So, given that there’s very short follow-up period even in these initial patients, we don’t expect large numbers of patients to be able to be updated mid-year. But obviously, we would like to provide as much data as possible. Based on the enrollment that we are seeing at the current time, we do expect to meet our objectives by mid-year of enrolling the 40 patients in prostate cancer, 20 in non-small cell lung, and maybe in the triple negative breast, as well, but more likely later this year. With regard to the data that we will provide, as noted in my previous remarks, we will include patients that were in dose escalation arm in the study at 4 mg per kg and several other patients are still on treatment even at this time. And so, again, we will provide an update as much with what we can in terms of data available at some cut date in the spring. And obviously, even later in the year, we will provide additional data as more scans come in and analysis of PSA, particularly in prostate patients. With regard to the RECIST evaluation of the prostate patients, this protocol will allow patients that have both bone-only disease as well as measurable disease in various organs. There is no set number, and at this point for the patients who haven’t enrolled, we clearly have patients that are coming in with measurable disease, but I won’t be able to do the specifics until the time occurs at the meeting.

Got it. Thanks. That’s helpful. And then just for the prostate cancer patients, given that you have some patients from dose escalation and expansion, what kind of duration of PSA response do you think will be encouraging in this late line patient population? And are there any other durability metrics that you might be looking to assess? Thank you.

Thank you. And obviously, if you look at the historical data from other standard of care, the length of time which one sees a 50% reduction of PSA levels is relatively quite short, and may be in the order of two to three months maybe slightly longer in certain cases. So clearly, we want to clear that bar, and we look for the length of the duration of responsiveness to be six months or hopefully even longer. One thing we have observed from the patients treated so far, to give you little perspective is that, if the patients are able to continue on the drug that the effects are seem well. Obviously, we can’t predict what’s going to happen in the future. So the goal here is to identify the ideal, not only dose of the drug, but the dosing interval of the drug and obviously select the populations that can have the most exposure to treatment with MGC018. And in those cases, we hope that that will then lead to prolonged responses. With regard to the other objective responses is obviously we are monitoring for the metastatic lesion. So we will look at radiographic evidence of PFS and then ultimately our goal is obviously overall survival, given in these late line patients survival is quite modest on the order of more than a year.

Thank you. Our next question comes from Umer Raffat with Evercore. Your line is open.

Thank you. This is Bo for Umer and John. Hi, Scott. Could you remind us what is the biomarker panel that you are using for the LAG-3 PD1 bispecific and that includes LAG-3 and some other markers that you have talked about before. And could you give us some specific and how are you measuring that panel? And how do you see that getting commercial adoption? Thanks.

Thank you, Bo and great question. The data that we presented last year was based on our own internal IC data that we have developed with the antibodies. We also analyzed that data with respect to transcript level in collaboration with NanoString and with NanoString we looked at a fairly large group of immune associated markers. And as we noted previously, we are seeing some very nice correlation with responsiveness in the monotherapy treated patients with some of the gamma interferon associated genes and other immune activation genes. Going forward, we have not announced specifically which one on ones of these biomarkers will be employed for future studies. I would say at the minimum, the data today and an expanded analysis of additional patients in our study suggests a measurement of LAG-3will be a value, particularly in solid tumor patients. But we will provide some update, probably around mid-year on next steps going forward with regard to either monotherapy treatment in solid tumors, DLBCL or combination studies that are ongoing with margetuximab in late line HER2 patients.

Thank you very much.

Thank you. Our next question comes from Yigal Nochomovitz with Citi. Your line is open.

Hi, this is Parley [Ph] on for Yigal. Thanks so much for taking the question. First, just to follow-up on a prior question on the MAHOGANY Module A initial data that have. Assuming you meet sort of that internal threshold that you were referring to on ORR, what would the next steps be? Would you plan to enroll additional patients and if so, how many patients? Or would you need to go back to the FDA to discuss potential for accelerated approval?

Thank you, Parley for the question. So, have already had the discussion with the FDA with regard to the analysis of the data and what we would do next if we meet the criteria for Module A. This would be a continuation of the study as is, continue enrollment of patients. We will have modest number although we have not specifically defined what that is publicly. We are also have initiated Module B with Zai Lab in Asia and have sites now up in Europe which we can recruit patients ourselves which is expected at the time we will sharing the analysis of this part of Module A. It’s important to note that within this Module B, there are opportunities to look at the contribution of components to support the study for the Module A. So, all until, I think that if we are successful to meet the criteria set, enrollments will go fairly quickly and should have a – hopefully a good set of data that we could support submission to the FDA for accelerated approval.

Okay. Great. That’s really helpful. And are you able to comment on when we should expect initial data from Module B?

Yes. Right now, we are still in the early throws of enrollment there. As I said, Zai Lab is the main enroller right now. We will turn that on later this year again assuming we met a particular criteria. But I can’t give you projections right now in terms of the timing of when that study would be completed.

Okay. No problem. Understood. Thanks for taking the questions.

Thank you. Our next question comes from Etzer Darout with Guggenheim. Your line is open.

Hi. This is Paul on for Etzer. Thanks for taking our questions. For your tebotelimab study in DLBCL, you mentioned some clinical updates later this year. Could that sort of be around this year’s ASH Meeting? Or are you aiming for something more near-term? And also, wondering if you could seek out any plans to explore combinations with tebo in the setting for DLBCL?

So, with regard to the update, we will provide an update probably outside to the conference at least in terms of our next plan and potentially some of the data update on DLBCL probably before ASH, but this is now with a possibility that we’d also include a submission to ASH. I missed the second question, was tebo on what?

Combination, plans to explore combinations, yes.

Yes. So, as you may have heard earlier, we are very excited that the start of the study right - literally in the next week or two with enoblituzumab particularly plus tebotelimab in PD-L1 negative patients with head and neck cancer. This is a frontline study. Again, recall as we presented early this year in our combination of tebo with marg, the Fc engineering that we have incorporated in both those molecules has the ability to upregulate various checkpoints including PD-L1, LAG-3 and others. And so, again, our hope is, is that, when we execute this in the head and neck study, we will take advantage of that activation property to then get a better therapeutic effect of combining tebo with enoblituzumab.

Got it. That’s helpful. And then, just one more, I was wondering if you could give us a little bit more color on your MGD024 program and sort of how that differs from flotetuzumab and sort of what kind of dosing regimen you are aiming for with the longer half life there? Thanks.

Well, thank you. If you go back to some of our presentations at some of the scientific meetings, we are very excited about the prospects of the sort of next generation redirected killing mechanism in our DART technology exploring PD3 based mechanisms. We had spent a lot of time screening various mutations of that could offer slightly the properties of CD3, so that combines our molecule target to a particular target would allow for maximum killing effect, but mitigate the cytokine leads associated with treatment. We have incorporated that paradigm in multiple molecules and the first one that will come in – go into the clinic is MGD024, which has the exact same CD123 variable domain that’s incorporated in flotetuzumab, but with slightly low CD3 that will allow for these hopefully improved properties. Of course, we’ve also added an Fc domain and so, the opportunity here is to extend the half life of this molecule. So the drug will be given intermittently. We should be able to achieve CMAX with this – with relative safety if all goes well, based on our preclinical data and we will start this study later this year. Right now, it is viewed as not a replacement for flotetuzumab potentially an add-on. We see the prospects are most beneficial in a sense of using this once the patient is on flotetuzumab, and goes into a remission to use it as maintenance and consolidation therapy, as well as expanding those into other indications including myelodysplastic syndrome and other malignancies. So we are very excited to be in this. We expect to be the first of several different CD3 redirecting next-generation molecules.

Thank you. Our next question comes from David Lebowitz with Morgan Stanley. Your line is open.

Thank you very much for taking my question. Could you characterize the opportunity for retifanlimab?

So, thank you, David. As you know, we are very excited about the activity that Incyte is pursuing for retifanlimab. I would say, I look at this from a perspective both as a very good anti-PD1 molecule that is now being pursued as monotherapy in both niche and large tumor indications and many, many studies in combination. I believe there are over now 30 clinical studies ongoing using retifanlimab. With regard to the mid-term PDUFA date, the first indication is, in this opportunity, a small opportunity, for which there is a great need of patients with anal cancer progress fairly rapidly and many of these patients progress after plasma therapy or intolerance of that therapy. So, we are hopeful that that will be the first molecule that will – this is the molecule with a first indication to get in the market. But as I noted earlier, there are multiple other registration directed studies being conducted by them. So there is opportunity to expand on the indications, probably in a relatively short period of time. For us, it’s also a very important opportunity for revenue generation as we’ve noted on the call today, it’s literally in the last few months, we’ve got additional $50 of milestone payment from Incyte. We expect more to come and certainly, if the drug is approved, a significant milestone will be accompanying that as well.

So, there will be an expected milestone with the first approval?

There would be expected milestone with approval. The – we are not – we are not enabled to be able to tell you the magnitude of that. But given an approval of the first drug, that could be significant for us.

Would it be reasonable to expect it will be larger than the milestone you just received?

I am not going to comment further on the specifics here. But it’s considerable. I would also make note that there are future other milestones both for clinical and regulatory, as well as commercial milestones that are quite sizable and then royalty rates that are 15% and that’s tiered up to 24%.

Okay. Thank you for taking my questions.

Thank you. Our next question comes from Peter Lawson with Barclays. Your line is open.

Hi good morning. This Mitchell on for Peter. Thanks for taking our questions. For MGC018, how do you think about the positioning in prostate cancer, given it’s a broad landscape and what could pivotal designs look like down the line?

Thanks, Mitchell for that question. As you know, we started out analyzing patients who are very late-state patients. As you know in our dose escalation study, many of these patients have been as many as six lines of therapy previously. Right now, our current pursuit is in the castration resistant prostate indication in patients who have progressed on a chemotherapeutic agent and at least one AR agent. So, I think this is a nice first entry into the treatment of prostate cancer. Certainly, we could be moving up early in line as well. With regard to a registration study, the results were out in the current study. Current approved drug is cabazitaxel as the second chemotherapeutic agent. And so, I could envision a head-to-head study of MGC018 with cabazitaxel as next steps for our registration study. Obviously, we would have to go to the regulatory agencies with regard to that. Let me revisit that.

That’s great. It’s very helpful. And then on flotetuzumab, with the second half update, what kind of update is that and what could the size and scope of the next dataset look like?

Well, thanks again for that question. As you know, we were in this single arm registration study for flotetuzumab in the primary induction failure, early relapse population. We are rolling in that study currently. We had opened into the development of this study of various looks at the data as various times of patient enrollment. So, right now, patients are enrolling, but I can’t give you right now the projection of the numbers that we will achieve by the end of the year. What we are targeting is some analysis of at least a first of – look at this data, by the time of ASH. But right now, it’s too early to project that.

Thank you very much, Scott.

Thank you. [Operator Instructions] Our next question comes from Boris Peaker with Cowen. Your line is open.

Hi. This is Sruthi [Ph] on for Boris. Congrats on all the progress in 2020 and thanks for taking our questions. A quick one for me for MGD019. Should we expect data from both the colorectal and lung cancer cohorts in mid-2021? And at the moment they are pretty similar between those cohorts and what kind of data should we expect?

Thanks so much for those questions. So, we have – our rolling on – in the PD1 CTLA4 019 molecule, the colorectal is pretty close to enrollment of that cohort. We are just starting the enrollment on the non-small cell lung cancer cohort, because we want it to go into checkpoint anti-PD1naive patients. And as you know, given that, that’s approved in the U.S. we have to go ex-U.S. to begin the recruit of patients. Those sites are up. We are beginning to enroll further on to the study. So, I would say that, it’s most likely, we would this year, be able to provide an update for the colorectal study. Also, it’s likely we will be able to talk about some additional cohorts that we will be aiming to this study, as well. With regards to the specific scientific forum, we haven’t chosen one yet. But we will be providing updates during the course of the year.

All right. Thank you for taking our questions.

Thank you. and I am currently showing no further questions at this time. I would now like to turn the call back over to Dr. Scott Koenig for closing remarks.

Thank you, operator, and thank you all for participating in our call today. And we look forward to update you on our various programs and the beginning of our launch of MARGENZA. Have a great day.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.