Xencor, Inc. (XNCR) Q4 2015 Earnings Report, Transcript and Summary

Good afternoon, and welcome to the Xencor Fourth Quarter and Full Year 2015 Financial and Operator Results Conference Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we will open up the call to your questions. [Operator Instructions]. Please be advised that this call is being recorded at the Company’s request. At this time, I would like to turn it over to Sarah McCabe of Stern Investor Relations. You may begin.

Thank you, operator. Good afternoon. This is Sarah McCabe with Stern Investor Relations, and welcome to Xencor's fourth quarter and full year 2015 financial and operating results conference call. This afternoon, we issued a press release, which outlines the topics we plan to discuss today. The release is available at www.xencor.com. Today on our call, Bassil Dahiyat, President and CEO, will discuss the company's business and clinical highlights; Paul Foster, Chief Medical Officer will discuss the Company’s clinical trial and 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, including clinical trial plans for XmAb5871, XmAb7195, XmAb14045 and XmAb13676 and its other bispecific product candidates, future financial and operating results, future market conditions, the plans and objectives of the management for future operations, it’s partnership and licensee status and plans 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 these events described in these forward-looking statements 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 sections of its most recently filed Annual Report on Form 10-K or quarterly report on Form 10-Q. With that, let me pass the call over to Bassil.

Thanks Sarah, and good afternoon everyone. 2015 was a busy and productive year for Xencor. We announced promising data for both of our lead internal monoclonal antibody program. XmAb5871, and XmAb7195 and positioned two new internal bispecific oncology drug candidate, XmAb14045 and XmAb13676 for initiation of clinical development in 2016. We entered 2016 in a strong financial footing following the successful $115 million equity offering early in 2015 and we grew about our senior management teams and our board of directors. And not only have our partners continued to advance their seven clinical programs using our XmAb technology, but we also announced a new partnership granting Amgen rights to access our XmAb bispecific technology for use in multiple Amgen candidates. Now we believe 2016 will be an important execution year for us as we plan to initiate six clinical trials across four programs. Key to this expansion of our pipeline are our first bispecific oncology programs, which we believe will demonstrate highly potent key T cell activity against tumors combined with the simplicity and robustness of our XmAb antibodies. We also expect our partners to continue to advance the broad licensed XmAb clinical development pipeline. Now, we’ll begin today with an update on XmAb5871, our first-in-class monoclonal antibody that targets CD19 with its variable domain and it uses our proprietary XmAb immune inhibitor Fc domain to target Fc-gamma-RIIb, a receptor that inhibits B-cell function. Though 5871 has shown potent reversal B-cell inhibition and promising treatment effect in rheumatoid arthritis in a Phase 1B2a study that we presented most recently at the American College of Rheumatology Meeting in November. With that, I’ll let Paul faster describe the two new clinical trials that we just started for 5871. Paul?

Thank you, Bassil. We just today announced that we have dosed [ph] subjects in two Phase 2 trials evaluating Xmab5871 for the treatment of IgG4 related disease or IgG4-RD and for systemic Lupus erythematosus or SLE. The first of these trials is a Phase 2 open label pilot study of XmAb5871 in patients with IgG4-RD being conducted at Massachusetts General Hospital by Dr. John Stone. IgG4-RD is a rare fibrone flamatory order immune disorder that affects multiple organs and affects upto 40,000 patients in the U.S. It currently has no approved therapies. The disease is characterised by a distinct microscopic appearance of diseased organs which forms the basis for an objective diagnostic criteria and that offers advantageous for accurately identifying patients. As we described in the past, this study is designed to access control of disease activity with every other week IV administration of XmAb5871. We plan to enrol approximately 15 subjects for upto 24 weeks of treatment and the primary endpoints to evaluate the effect on IgG4-RD Responder Index to measure treatment activity. Dr. Stone who led the development of this responder index is currently conducting an international validation study of this disease response index. We expect to report preliminary data from our pilot study in IgG4-RD disease in the first half of 2017 and -- IgG4-RD as a newly defined disease, we have the opportunity to be at the forefront of providing a treatment for patients. We are also evaluating XmAb5871 in a Phase 2 randomized double blinded placebo controlled study in SLE. SLE is an inflammatory disease that can affect numerous organs in which the body's immune system attacks its own healthy tissue. The disease affects an estimated 240,000 patients in the United States each year and the unmet need remains high. The standard of care including immunosuppressive medications with numerous side effects in limited FXC [ph]. SLE is a new indication for XmAb5871 which we decided to pursue based on XmAb5871 potent’s reversible B-cell inhibition and promising treatment effect demonstrated in our Phase 1b/2a study in rheumatoid arthritis, as well as ex vivo results we published showing inhibition of SLE patient B-cell activation and humoral immunity. In addition to the signs of activity of the molecule and the rheumatoid arthritis patient population, a trial designed with the relatively short time to end point provided rational for pursuing the SLE indication. A Phase 2 SLE trial is a novel design to evaluate the ability of XmAb5871 to maintain the improvement in disease activity after a short course of intramuscular steroid therapy and in the absence of immune suppressive medication. This trial design was previously tested in an observational study by Dr. Joan T. Merrill of the Oklahoma Medical Research Foundation, who is the coordinating investigator for the XmAb5871 SLE trial. When background treatments are reduced, six month response rates to a brief course of steroids are known to be low without the addition of an effective therapy. We believe that this trial design allows us to assess the effect of XmAb5871 on SLE disease activity with a shorter time to endpoint six months and with fewer patients compared to standard SLE trials, which generally add new medications to the many already being taken by the patient. The trial is a randomized, double-blind, placebo-controlled, multiple dose trial being conducted in the U.S. at approximately 20 sites. Approximately 90 SLE patients will be enrolled with a 1:1 randomization of XmAb5871 to placebo. Patients will enter screening with active, non-organ threatening SLE, and importantly they will discontinue background immunosuppressive medication. Following a short course of IM steroids to quiet SLE disease activity, we will randomize patients to XmAb5871 or placebo and monitor maintenance of the disease activity improvement. Finally, we also plan to initiate a bio-equivalence trial with a subcutaneous formulation of 5871 this year. Now, I’ll turn it back over to Bassil.

Thanks, Paul. So I’ll sum up the 5871 discussion by saying that while our excitement for the potential of 5871 in autoimmune disease is bolstered by the promising results from our Phase 1b/2a study in RA, we decided as we stated before to focus on the development of treatments for diseases with the highest unmet need and are no longer pursing RA. Now development in IgG4-RD and SLE provide complimentary opportunities to start to build the value of 5871 in a portfolio of autoimmune diseases. IgG4-RD is a smaller new indication with no approved therapies that Xencor can see rapidly. And SLE is a larger indication with a high unmet need and the chance to engage in an innovative trial design to potentially overcome historical development bottlenecks. Now, we’ll turn to our second lead internal clinical program XmAb7195. 7195 is our antibody that targets IgE with its variable domain and that uses an identical XmAb immune inhibitor Fc as 5871, resulting in this case in three distinct mechanisms of action for reducing IgE levels, in particular rapid clearance of IgE via Fc-gamma-RIIb binding on liver sinusoidal endothelial cells. And we believe that 7195 has the potential to provide a first-in-class mechanism for reducing IgE that will address the full spectrum of [Indiscernible] XmAb including the hardest treated population higher IgE levels. And during 2015, we reported top line interim data and continued our ongoing Phase 1a trial of 7195 and we look forward to announcing full data from this completed study in the first half of 2016. As a reminder, this study evaluated a single dose of 7195 in both healthy volunteers and patients with high base line IgE levels and in June of 2015 the trial was expanded to include cohorts of healthy volunteers with a split dose of 7195 consisting of small priming dose and a second descending dose after one week. The expansion portion of the trial designed to extend an IgE reduction and drug safety following the second infusion. Top-line interim data from the Phase 1a -- Part 1 of this Phase 1a study was reported in January of 2015. I’ll recap that healthy volunteers received a single dose of 7195, data shows that our drug is very potent with a rapid reduction of free IgE levels to below the limit of detection in 90% of treated subjects, including those treated at the lowest dose level of 0.3 mg/kg, as well we saw parallel reductions observed in total IgE. A dose limiting toxicity of transient, asymptomatic thrombocytopenia was also observed at the 3.0 mg/kg dose. Now, for this year we plan to initiate a multi dose trial with a subcutaneous formulation of 7195 and expect to announce initial results from this trial in the first half of 2017. So next, I’d like you to discuss our bispecific oncology pipeline. The core of our bispecific program is a novel XmAb Fc demand, which lets us create a single molecular combined two target simultaneously, now we believe that this is a flexible approach and allows us to rapidly create drug candidates by combining any two binding demands while maintaining the full length antibody properties conferred by the XmAb Fc demand, such as favourable in vivo XmAb and simple manufacturing. Now our initial bispecific programs are tumor-targeted antibodies that contain both a tumor antigen binding domain and a cytotoxic T-cell binding domain, in this case CD3. 14045 target CD 123 in acute myeloid leukaemia or AML cells and CD3 on the other side of the molecule to engage T-cells. It showed sustained and potent depletion of target cells in primase [ph] studies from well tolerated single IV doses. We expect to initiate a clinical trial this year. 13676 targets CD20 on malignant B-cells and of course CD3 on the other side for the T cell engagement. We expect to begin a clinical trial for B-cell malignancies also this year in late 2016. Now we plan to initiate clinical trials for additional bispecific oncology candidates in 2017 and will nominate targets for these trials later this year. Now the parallel events of multiple candidates as well as our partnership with Amgen are enabled by the simple, plug-in-play portability and robustness of the XmAb Fc demand. We announced the Amgen research and license agreement this past September and it granted Amgen the right to use our XmAb bispecific Fc demands to develop and commercialize five bispecific molecules based on their antibodies. We also licensed Amgen our preclinical T cell engager against CD38 and CD3 in this case targeted for multiple myeloma. Now the Amgen program consists of predetermined targets that is we know what they are, they were part of the negotiation of the licensed agreement and they include a T cell engagers for oncology and bispecific antibodies for inflammatory. Xencor is going to be performing initial molecular engineering work and Amgen will do all development in commercial of the programs. We received $45 million upfront and eligible to receive $1.7 billion in milestones as well as royalties on sale. Now Amgen is an excellent partner for our bispecific Fc platform. They have a lot of experience with bispecific oncology antibodies having one bispecific immuno -- antibody in the United States. I’ll note that we also announced preclinical data for the CD38xCD3 program at the American Society of Hematology Meeting in December which demonstrated the activity tuning possible for our flexible XmAb bispecifics. Now, I’ll touch briefly on some of our other partnerships. In the fourth quarter, Alexion Pharmaceuticals exercised an option for a commercial license to Xencor's Xtend antibody technology for use in a therapeutic candidate which triggered an option prepayment and as well they paid a development milestone for an undisclosed molecule against an undisclosed target. Now in September of 2015, our partner, CSL Limited, through its licensee Janssen Biotech, initiated a Phase 2 clinical trial of CSL362 which is now called JNJ-56022473. It uses our Cytotoxic Fc Domain, for the potential treatment of patients with AML. This trial initiation also triggered a milestone payment to us. And finally, I’ll turn to the leadership team here at Xencor. In May of 2015, we announced the appointment of Mark Lotz, as vice president of regulatory affairs and Wayne Saville, as vice president of oncology clinical development. Together, Mark and Wayne combine 60 years of experience in Xencor in biotech and pharma regulatory affairs and in Medical research respectively and they will contribute greatly to our expanded clinical development efforts. We also appointed A. Bruce Montgomery, and Yujiro Hata to our Board of Directors in 2015. Now, I’m confident these new appointments will be invaluable to be continued to develop Xencor into a product focused company. And with that, I’ll turn it over to John Kuch to review our financial results.

Thank you, Bassil. In this afternoon's press release, we reported cash equivalents and marketable securities totaling $193.3 million as of December 31, 2015, compared to $54.7 million as of December 31, 2014. The increase reflects the net proceeds of $115 million received from the completion of our follow-on financing in the first quarter in addition to milestone’s collaboration revenue from partners and collaborators during the full year 2015. Revenues for the fourth quarter of 2015 were $21.8 million compared to $5.7 million in the same period of 2014. Revenues for the full year ended December 31, 2015, were $27.8 million compared to $9.5 million for the same period in 2014. Revenues in the three and twelve month period ended December 31, 2015, were higher than revenues for the same period in 2014 due to milestone and option payments received from our Alexion collaborations and revenue earned from our Amgen collaboration. Research and development expenditures for the fourth quarter of 2015 were $10.9 million compared to $5.1 million for the same period in 2014. R&D expenses for the full year ended December 31, 2015, were $34.1 million compared to $18.5 million for the same period in 2014. Research & Development expenses for 2015 were greater than the expenses in 2014 due to an additional spending on XmAb5871 clinical programs and on our bispecific programs. General and administrative expenses in the fourth quarter 2015 were $3.4 million compared to $2 million for the same period in 2014. G&A expenses for the full year ended December 31, 2015, were $12 million compared to $7.5 million for the same period in 2014. Additional spending and SG&A in 2015 reflects additional compensation cost and legal fees. Non-cash, share-based compensation for the full year 2015 was $4.9 million compared to $1.9 million for the full year 2014. Net income for the fourth quarter 2015 was $7.8 million compared to a net loss of $1.3 million for the same period in 2014. The net income earned in the quarter reflects revenue earned from our Alexion and Amgen collaborations. Net loss for the full year of 2015 was $17.6 million or $0.45 per share on a fully diluted basis, compared to a net loss of $16.4 million or $0.52 on a fully diluted per share basis for the full year 2015. This increased loss for 2015 over 2014 is primarily due to additional R&D spending. The total shares outstanding as at December 31, 2015 is 40,551,039 which reflect the additional 8.625 million shares issued in our follow-on financing in the first of quarter 2015. Based on current operating plans we continue to expect that we have sufficient cash to fund research and development programs and operations through 2019 and expect to end 2016 with approximately $150 million in cash, cash equivalents and marketable securities. With that, we would now like to open up the call for your questions. Operator?

Thank you. [Operator Instructions] our first question comes from the line of Michael Schmidt with Leerink Partners. Your line is now open, please go ahead.

Hey, good evening and thanks for taking my question. I had one on the Lupus study for 5871 [Indiscernible]. I guess B-cell targeting has been a fairly difficult mechanism, I guess historically and lupus if you think back to the failed rituximab studies, Ocrelizumab or NCL [ph] all of those have not been as successful I guess, how comfortable are you with the mechanism in Lupus of 5871?

Well I think the mechanism is supported by the ex vivo data where we have demonstrated, it is in the paper we published about in 2011 and during the immunology demonstrating but I think around 28 Lupus patient B-cell samples where we able to inhibit to the same extent we could inhibit healthy donor B-cell samples using 5871. So it inhibits activation, inhibit human oral [ph] responses in reconstituted skid mice models. And this is quite similar to the data we saw for RA ex vivo studies. And so, I think that helps bolster our confidence that our agent can do something with Lupus B-cells. I think the B-cell like hypothesis [ph] and SLE generally, yes its mixed and I think you have to remember the first newly approved agent in lupus in 30 or 40 years that have been listed an antibody that acts by inhibiting B-cells. So, I think the B-cells play a role in lupus is pretty clear. And I think that is a therapeutic intervention, there is very good support at least as good as any other access or mordalility. Now, I’ll maybe ask Paul to comment on part of the point of this trial design if you try to key the part what your drug might do from many of the conflicting factors that typically have gone into lupus drug clinical trials.

Well exactly, this trial is designed to give us some proof of activity in lupus. And based on the results of this trial we determine whether or not we go on for full development.

And as we are trying to understand a Phase 2 design, so it sounds like you are getting patients I guess in to remission so to speak with steroid and then trying to maintain them in that state, whether your drug, while the placebo arm is expected to -- patient are expected to decline is the way to understand it, what is the endpoint that you are actually looking at after six months?

Now, that’s correct. So we are taking patients and they are being, this activity is being cooled down with IM steroids, so each patient gets the same steroid course. And then we look to see if we can maintain that disease improvement over the course of six months of therapy with the expectation that placebo patients are going to all return to their baseline disease activity or worse during that six month period. And what’s important is that as part of this we removed their background immuno suppressants.

Yes. And what are you actually measuring as endpoint?

So, we’re measuring disease activity by SELENA SLEDAI and BILAG. And so they need to reach a certain degree of disease improvement on steroids before they randomized. And then we look for a worsening of disease activity by SELENA SLEDAI or BILAG, in addition the investigator has to think that, that increase of these activity warrants treat, warrants addition medication to their therapeutic regimen.

Okay. And are you considering a biomarker strategy down the road for this indication?

Yes. Collecting --, yeah Paul.

I can say, we’re collecting a number of biomarkers during the study and we’ll have to evaluate data at the time of the study

Okay. And then it sounds like you’re working on the subq formulation, and I guess when do you think the Phase 2 will wrap up and when do you think, I guess will the subq be ready for Phase 3. And then secondly, are you looking at a partnering strategy down the road or trying to maintain this or develop this in-house?

Yes. Our goal to have subq formulation ready for new trials that would start in 2017 or later, so the subq study is going to start this year for -- as bioequivalence and from there we’ll go to – hopefully having it ready for any future study and we think that it is an important feature of the eventual product profile. From an overall business strategy around the compound, I think what we want to do right now, is to establish multiple areas, multiple disease indications where 5871 has established activity where we can again clearly get answers from the Phase 2 studies that we’re designing. And I think there is lupus, innovative lupus study designs that Dr. Joan Merrill of Oklahoma is collaborating with us on. I think this is an important step for clarifying how the kind of answer we can get out of a lupus safety trial which is often compounded as you pointed out in the past. I think having multiple indications where we can demonstrate 5871 has an impact, I think positions us in different ways. For IgG4 that’s an area where you can conceive driving forward all the way through development potentially by yourself depending on what kind of registrational path you can negotiate with the regulatory authorities. I think lupus is an area where it certainly opens up a broad array of potential partnering opportunities if you choose to go that way because of the very large size of the market and the high unmet need. There is yet a lot of mid and late stage clinical development going on, but I think the opportunity still remains very, very high. So, we want to have those multiple options, so we can find the best path for the molecule. Keep on you know the option open in the more rapid to developed IgG4, which is really still going to be the near term story as we build broader value around the asset as a whole.

Got it. Okay. Thanks. I’ll hop back in the queue.

Thank you. Our next question comes from David Nierengarten with Wedbush. Your line is now open. Please go ahead.

Hey. Maybe kind of additional question on lupus study, as we all know that most of the study – our studies took 1600 patients to ease out their effect. I mean, what kind of effect size do you think you might see or any studies are pointing to what kind of effect sizing I’d see at [Indiscernible] conference that maybe you can do it with your patient in a shorter timeframe? Thanks.

Well, I’ll let Paul comment. I think what I could say at the outset is there are no published studies yet that point this out. However there is certainly a general experience that guides us on patients who are off there, immunosuppressants.

So the – without having done the trial we can’t really say what effect that we will see. We do know that in this type of design if you’re on placebo, that virtually every patient will have -- relapse are gone back to their level of disease activity by six months. So, we’re looking to see a clinical substantially increase proposition of patients at six months who have not returned to their disease activity level.

Okay. And then….

And then also withdrawal [ph] trials one a way to look, you are withdrawing the therapies that often sort of maintain a certain percentage of patients so you can clarify the activity of your drug.

Got it. And then, I mean, I guess, then the next question would be just a follow-up on how clinically relevant that is, given the patients propensity to maintain steroid user switch to more aggressive regimen including the most -- more definition? Thanks.

So, Paul, do you want to take that?

So based on the discussion with the investigators especially Dr. Merrill, I think that, what we’re targeting here is to look for a fairly large benefit from this. How that translates into overall clinical benefit patient population that would be subject of further development and design of those trials. We sort of look at this trial similar to what [Indiscernible] I mean with a medication with exacerbation rates.

Yes. So that will give us clarity on what’s going now. One thing I will point out is that, there currently is no active guidance from the FDA on what a development, very special development program for lupus would look like. There had been one, based on when list is approval, they sort of put out guidance, but they went through that a few years ago, because I think lack of general acceptance among the medical community. So, looking for new strategy and lupus start development, something people have been talking about for a long time and we’re sort of jumping into the forefront of that and we’re going to run this study and see where it takes us.

Thank you. Our next question comes from the line of Christopher Marai with Oppenheimer. Your line is now open. Please go ahead.

Hey. Yes. Thanks for taking the question. First maybe if you can just clarify roughly the cost of the Phase 2 trial in the lupus or on that topic. And then secondly perhaps when we expect to get some updates on a data from IgG4 program as well? Thanks.

Sure. So, we don’t break out the cost for individual trials and I will say that it is completely contained within the financial guidance we’ve been giving for a while now that is the cost of this trial. It’s 90 patients, six-month treatment period, I think that keeps it well within what we would – as a small company we call reasonable size base, but it is well within our – its all within our guidance, right, it doesn’t change our financial guidance at all. We would expect to provide first data on the IgG4-RD study in the first half of 2017.

Okay. And then just with respect to lupus, any data timeline here and with respect to subcutaneous formulation of 7195, how is that coming, when it’s actually ready for patients? Thanks.

Sure. So we would expect data from the 58 -- topline data from the 5871 lupus trial in 2018, and we also – the 7195 subcutaneous formulation is expected to start Phase 1 multi-dose trial this year -- middle of this year.

Okay, great. And just maybe remind us real quickly on the subq trial design for 7195 that’s going to be a multiple ascending dose, is that correct?

It’s going to be a multi-dose study in healthy volunteers with a parallel group design that is different dose levels but simultaneously, because we’ve established a range of doses already from our single dose study. And we will look for, of course the safety and tolerability as well as look at biomarker such as IgE levels. And we would expect to put that data in the first half of 2017.

Thanks guys.

Thank you. Our next question comes from Arlinda Lee with Canaccord. Your line is now open. Please go ahead.

Hi, guys. Thanks for taking my questions. First maybe just to clarify the top line data that as far as the data that you’re expecting in first half of 2017 for 5871 and IgG4-Related Disease, is that top line or whole data at the medical meeting?

That would be top line.

Okay. That will be top line, okay. And then, is that the same for parallel multi-dose 7195 data?

Yes. We would expect that to be a top line announcement at the outset, as per full release that would be later than first half of 2017, full data.

Okay. And then, maybe for John, can you provide additional color on the Alexion Amgen split on the revenue line?

Are you talking about the breakout of the revenue?

Yes.

That will be details of the SEC filings. Amgen gets little bit complicated because you breakup the upfront into deliverable, the CD38, CD3 preclinical compound and the five discovery programs that we’re going to be doing some nominal engineering workforce. So, I think it’s about 13.75 million was for the Amgen. And then the Alexion is $7 million, $8 million. And I think guys, that’s all be broken out in our 10-K filings which should be closing shortly

Okay, great. And then maybe you can talk a little bit about the – I guess maybe your philosophy going forward on additional bispecific, we saw in the ACR abstract title that you guys had a presentation for PSMA and CD3 and we were wondering if you were interested in kind of going into immuno-oncology and what’s your thoughts are there? Thank you.

Yes. So our philosophy for the additional bispecific candidates, we have beyond 13676 and 14045 as to rapidly as we can use plug and play bispecific capability to put forward new molecules. We expect around the middle of this year to announce our new leads and what we plan on doing this having one new lead that’s a CD3 bispecific, so a T-cell target against specific tumor cell. We’ll disclose the target at that time. And the other lead will have -- will actually be a dual check point bispecific, so that is a molecule that finds two different T-cell checkpoints and inhibits both checkpoints simultaneously. The idea there being to increase the selectivity of checkpoint inhibition to more highly checkpoint inhibited rather more highly checkpoint repressed cells that are typically more abundant in tumors. So those are two kinds of candidates, we’ll announce the details of later on and the idea is to continue to extend our efforts in oncology based around our bispecific capabilities.

Okay, great. Thanks very much guys.

Thank you. Our next question comes from Michael Schmidt, Leerink Partners. Your line is now open. Please go head.

Hey thanks for taking the follow-up. I just had one more on 7195 in terms of expectations for this update coming in the second quarter, I guess can you remind us are those all high IgE patients in this update and I guess how many patients has been treated at this point?

The trial is let’s just -- the data we’ve not presented yet is for part 2 and 3 of that Phase 1a trial. The part 2 of that trial is in high IgE subjects treated with a single dose of 7195. Part 3 of that trial which was of the part we announced as a new portion, an additional portion in June of last year is in healthy volunteers using a split dose with one small timing dose followed by a second escalating dose. The data from those two parts as well as the full data from the previous top lines Part 1 that we release in healthy volunteers will all be presented later this year at a major medical meeting. And does that answers your question, or were also asking about the trial we’re about to start.

Yes. On this trial, I guess how many patients have been treated, the Part 2 and 3?

We’re right, Part 2 and 3 have been completed, and we’re right now cleaning up the data and preparing it for presentation.

Okay. And remind me the single dose high IgE sub checks; are those at three at one fixed dose or at ascending dose as well?

That was ascending doses.

Got it. And you said, there will be topline in the first half and then the conference in the second half is that correct?

I know, for this Phase 1a study, the IV study, it will be full data presented this half at a Medical conference. I think for our subcutaneous study we expect to have topline data in the first half of 2017. From the subcutaneous 7195 study, we plan to start mid-year and we would have full data from that at later date which we would announce.

Okay. Got it. And then last question, remind me of the Alexion royalty rate?

Its low single digit for the access to our extend technology.

Understood, perfect. Thank you very much.

Thank you.

Thank you. There are no additional questions. So, at this time, I’d like to turn the call back to Xencor's CEO Bassil Dahiyat for closing comments.

Thank you very much. So, to close we have a very full slate of development activities for the year ahead. We continue to grow and advance our XmAb pipeline. So in addition to the two XmAb5871 Phase 2 trials we started, we plan to start a clinical trial test subcutaneous delivery of both 5871 and 7195. In addition, we also plan to initiate the human testing of our first bispecific antibodies, XmAb14045 for AML, and XmAb13676, for the treatment of B-cell malignancies. Further, we’re going to nominate additional internal bispecific oncology development candidates. And then, last we plan to report full data from the completed Phase 185 trial of XmAb 7195 in the first half of this year. Thanks again for your time and we look forward to updating you on our progress soon.

Ladies and gentlemen, that does conclude today's program. And you may all disconnect. Everybody have a wonderful day.