Good day ladies and gentlemen, and welcome to the Xencor Third Quarter 2014 Earnings Call. [Operator Instructions]. I would now like to turn the call over to your host Deanne Tockey of Stern Investor Relations, please go ahead.

Thank you, operator, good afternoon this is Deanne Tockey with Stern Investor Relations and welcome to Xencor’s third quarter 2014 financial results conference call. This afternoon we issued our financial results and business review press release which is available at www.xencor.com. Today on our call Bassil Dahiyat, Ph.D. President and CEO will discuss the company’s business and scientific highlights from the quarter, then John Kuch Vice President of Finance, will review the financial results. And then we will open up the call for your questions. Before we begin, I would like to remind you that during the course of this conference call Xencor management may make forward-looking statements including statements regarding the company’s research and development, future financial and operating results, future market conditions, the plans and objectives of management for future operations and the company’s future product offerings. These forward-looking statements are not historical facts, but rather are based on Xencor’s current expectations and beliefs and are based on information currently available to us. The outcome of the events described in these forward-looking statement is subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements, including but not limited to, those factors contained in the Risk Factors section of its most recently filed quarterly report on Form 10Q. With that let me pass the call over to Bassil.

Thanks Deanne. Good afternoon everybody. Over the last quarter and last few months, we’ve advanced our pipeline on a number of fronts and have a number of milestones lined up to the end of this year and in the early 2015. For starters we regained right through our lead Phase 2 program XmAb 5871 and planned to advance in a clinical testing for the new, the rare newly defined IgG4-related disease in 2015. We also put into announce top-line Phase 1b/2a clinical data for 5871 in patients with moderate to severe rheumatoid arthritis by the end of this year. In January, we planned to announce preliminary Phase 1a data for XmAb 7195 or novel IgE reducing antibody. Just last week we announced the data update on our bispecific antibody programs and it will present some encouraging primate pharmacology results at ASH in December. And our partner Morphosys also announced that they’ll present Phase 2 NHL data on XmAb 5574 more to a weighted ASH. Now today, we are announcing that one of our partners Alexion as advanced the molecule using our extend technology for antibody half-life extension into clinical development. So, I’m glad to review some more of this progress in detail. I’ll start with XmAb 5871. It’s one of our internally discovered program and it’s a first in class monoclonal antibody to target Fc (gamma) R2b through its Fc domain, anti-CD19 to inhibit of B-cell function. We’ve seen very potent yet reversible B-cell inhibition in the Phase 1 trial with 5871. And this encouraged us to consider a variety of possible indications for development. Both large and small for 5871 were B-cells could be driving the pathology. And we also realized even if we see positive data from the completion of the ongoing Phase 1b/2a RA trial, pursuing smaller…

Thank you, Bassil. Revenues for the third quarter of 2014 were $0.8 million compared to the $3.2 million in the same period of 2013. Revenues for the nine month period ended September 30, 2014 were $3.9 million compared to $8.4 million for the same period in 2013. The decrease in revenue for the three and nine month periods in 2014 relates primarily to revenue earned under our Merck and CSL collaborations in 2013 and a $3 million milestone payment received on our Morphosys collaboration 2013. Research and development expense just for the third quarter of 2014 were $5 million compared to $4.2 million for the same period in 2013. R&D expenses for the nine month period ended September 30, 2014 were $13.5 million compared to $12.9 million for the same period in 2013. The increase in R&D expenses for three and nine month period ended September 2014 relates primarily to increase spending on our XmAb 7195 development program and on our bispecific programs. General and administrative expenses for the third quarter of 2014 were $2.2 million compared to $0.8 million for the same period in 2013. G&A expenses for the nine month period ended September 30, 2014 were $5.5 million compared to $2.4 million for the same period in 2013. The increases in G&A expenses in 2014 reflect increased compensation expenses, professional fees, the cost associated with being a public company. Non-cash share based compensation expense for the first nine months of 2014 was $1.1 million compared to $54,000 for the first nine months of 2013. The net loss for the third quarter of 2014 was $6.3 million or $0.20 on a fully diluted per share basis, compared to a net loss of $1.8 million or $57.87 on a fully diluted per share basis for the same period in 2013. For nine months ended September 30, 2014 the net loss was $15.1 million or $0.48 on a fully diluted per share basis compared to a net loss of $56.6 million or $4.10 on a fully diluted per share basis for the same period in 2013. The lower loss on per share basis in the three and nine months ended September 2014 compared to the same periods in 2013 are primarily due to non-cash expense of $48.6 million related to a loss on settlement of convertible notes, as reflected in the 2013 losses and the additional shares reflecting the 2014 per share calculations as a result of our initial public offering in December 2013. In this afternoon’s press release, we reported cash balance is totaling $60.9 million as of September 30, 2014. Based on current operating plans to expect to have sufficient cash to fund research and development programs and operations through 2016 and we estimate that our 2014 year end cash and cash equivalents will be approximately $54 million. With that, we’ll now open up the call for your questions. Operator?

[Operator Instructions]. Our first question comes from Michael Schmidt with Leerink. Your line is open. Michael Schmidt – Leerink: Hey good afternoon, thanks for taking my question. I had one on your bispecific antibody program. I was wondering you what considerations were taken into account for choosing CD123 as lead target for the program, it’s seems to be a fairly competitive space in that stage in AML? And what are your thoughts on that?

We consider sort of the magnitude of the unmet need were really for many years AML has been a very difficult, so AML would be the primary indication for this agent for targeting CD123. AML certainly an unmet need it’s a very difficult disease to treat, it’s a very poor prognosis. There are competing biologics in this space; I would characterize them all as relative early stage in the clinic. And I think that we felt our product profile could be competitive, because of the combination of T-cell engagements, so the mechanism of action being really driven by cytotoxic T-cells are very compelling MOA we would all agree, I think. As well as having extended duration of action and promising half-life. So, a half-life that maybe pretends being able to dose and deliver this agent like more typically you were with the regular antibody rather than some of the emerging immune therapies, whether they would be cell-based or some of the bispecific. So that was really the thought that we had something to offer that might be compelling. Michael Schmidt – Leerink: Okay, makes sense. And then, on more to, I saw in the ASH abstract there is data, the abs contains data on the first stage of the study and I was wondering if you could comment on what we could expect for this presentation at the actual conference with respect to the dose expansion cohorts?

I have no idea. I’ll be waiting for their presentation myself. Michael Schmidt – Leerink: Okay, great. Thank you so much.

[Operator Instructions]. Our next comes from Chris Marai with Oppenheimer. Your line is open. Chris Marai – Oppenheimer: Hi good afternoon guys, thanks for taking the questions. Congratulations on the quarter and the great abstracts. First, I was wondering just with respect to the anti-CD123 bispecific, looking at your abstract it appears that it was relatively well tolerated; I know that some folks on the street have been worried about, marrow talks, I was wondering if you had seen any talks there if you can comment any further on the safety profile of that therapy?

We’ll characterize the sort of safety profile that we observed in cynomolgus monkey and activities we saw in forth the poster. We did see that we could deplete target cells in the marrow, which is of course a good thing, that’s where the cancer really ultimately has to be treated. I think the more, a more thorough characterization is going to be available on the poster and I think ultimately really this question of the kind of talks that people are concerned about; it’s going to be answered in the clinic. I mean, I think a lot of that supposition is based on preclinical data of C123 and how it might, how it might cause depletion of certain cell sets and I’m not aware of any clinical related that speaks to that for any program yet. Chris Marai – Oppenheimer: Great that’s helpful, thanks. And then just, thinking about your bispecific platform technologies and broadly your business development plans going forward. Given what some competitors in the space have done with respect to competition, with respect to partnering, I was wondering, how are you looking at potentially partnering these assets or developing them further, I imagine you’ve been broadly receiving much interest from outside parties regarding this. Could you perhaps comment on that strategy?

Our strategy right now is, we’ve selected a lead candidate, we’re going to advance to the clinic or certainly examining a multitude of other molecules that we have in our research phase as well as the other two preclinical leads the CD20, CD38 to see which other ones we want to try to advance in the clinic. We want to have our own molecules that we get clinical proof-of-concept and before we partner. Now that’s balanced of course by the nature of the technology itself, which is part of our Fc tool kit which is plug and play, which means we can not only generate lots of molecules at the discovery stage and have sort of thought for partnering. But we can license the tool in a way that is very efficient and does not really require any of our own resources, much like we have done in the past with our cytotoxic Fc or half-life extension Fc. Now the technology itself is very new even in our hands, we’ve really only nail down within the last 12 months, the Fc 12 kit built our CD3 component and really this is the public data we have on this whole platform. So, we are examining how to partner this plug and play tool kit going forward and we’ll just have to see the kind of reception it gets. I think we offer something compelling in terms of long half-life simplicity and activity. Chris Marai – Oppenheimer: Great, thanks. Congrats on the quarter.

Thank you.

Our next question comes from Michael Schmidt with Leerink. Your line is open. Michael Schmidt – Leerink: All right, thanks for taking the follow up. I just had a question on the Alexion product. Can you comment on potential dosing frequency that they might look out for this?

I really can’t, all the details of that program are really something that Xencor has to refer to the partner, because we are not – we’re not at liberty to disclose the specifics of their program. So, we would have to refer to Alexion. Michael Schmidt – Leerink: Okay understood. Thanks so much.

This ends our Q&A. We do have a question from Arlinda Lee with MLV. Your line is open. Arlinda Lee – MLV: Hi guys, thanks for taking the question. Can you remind us of what upcoming milestones might be coming if they start Phase 1 or what the next development milestone would be?

Are you referring to Alexion? Arlinda Lee – MLV: Yes.

Well, the specifics of the deal, I don’t think are completed disclosed. So, however I think what has been disclosed is that there are clinical milestones that are still for various stages of clinical, I mean as well as, a license exercised fee, a commercial license exercise fee, they right now had a research license. They would have to exercise the commercial license prior to certain stage of clinical development. And so those are the pieces that you would expect to see over the next few years, I would say. Arlinda Lee – MLV: Okay, thank you.

Thank you. This ends our Q&A session. I’ll turn it back to management for closing remarks.

Thanks very much. Before we sign-off, I would like to reiterate our upcoming milestones. So, by the end of the year we expect to announce top-line data from the Phase 1b/2a trial of XmAb 5871 in RA as well as to present a fuller data set from our preclinical bispecific programs at the ASH Conference in December. Following that we expect to report preliminary Phase 1a data for XmAb 7195 in January of 2015. And with that, I would like to close. Thank you very much for your attention and we look forward to updating you again soon.

Ladies and gentlemen, thank you for participating in today’s program. This concludes the program. You may all disconnect.