Edited Transcript of FPRX earnings conference call or presentation 27-Feb-20 9:30pm GMT

Turning to this year. We are focused on generating clinical data from our proprietary programs and growing our pipeline internally and through asset acquisition. We are on track to achieve the data milestones this year from 3 programs, starting with bema. We expect a sufficient number of events will occur to trigger a futility analysis in the FIGHT trial in mid-2020. We remain on track to generate data by mid this year from the Phase I combination of FPA150 plus Keytruda in a cohort of patients with B7-H4 overexpressing ovarian cancer. We also expect to generate early monotherapy efficacy data in late 2020 from the FPT155 program. Helen will provide additional details about these milestones later on the call.

Growing our pipeline is also a key focus for this year. In addition to our programs in clinical development, we are advancing 3 novel late-stage research programs and we are on track to bring one new program into preclinical development later this year.

2 weeks ago, we announced a new licensing agreement with Seattle Genetics to develop and commercialize novel antibody-drug conjugates using monoclonal antibodies developed by Five Prime that are directed to a single target. We are also working to supplement near-term internal pipeline growth by acquiring programs that will leverage our agile clinical development and translational expertise. This will allow us to conduct early-stage trials and generate actionable data. We believe this multipronged approach to pipeline growth is the right strategy to pursue. It will result in prudent advancement and prioritization of our current clinical programs, while we pursue other ways to grow our pipeline. As part of the process, I have engaged deeply with many leaders in the organization who are passionate about our goals and energized by the progress we are making to position the company for future pipeline growth and success.

I will now turn the call over to Helen, who will provide an update on our clinical programs.

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [4]

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Thank you, Bill. Let’s begin with an update on bemarituzumab, our FGFR2b monoclonal antibody, which is under evaluation in the FIGHT trial, a Phase III front-line gastric cancer trial. As communicated previously, we’ve paused enrollment at approximately 150 patients pending the occurrence of a sufficient number of events, which will trigger a futility analysis. Based on the current event rate, we expect the necessary number of futility events to occur in mid-2020. Moving forward, we expect to resume enrollment in the FIGHT trial, only if the trial passes a futility analysis and Five Prime enters into a collaboration or licensing agreement with a partner that can fund all of the remaining development and commercialization costs. We remain optimistic that bema has the potential to benefit patients with gastric and gastroesophageal cancer and that the study will pass futility. However, in the context of prudent planning, we’re considering alternatives for the bema program in the event that we pass futility, but are unable to secure a partner. For example, one possibility might be converting the FIGHT trial to a randomized Phase II, which would generate data that could be shared publicly and, thereby, inform discussions with potential partners in order to catalyze a business development transaction.

Moving on to FPA150, which is our monoclonal antibody targeting tumors that overexpress B7-H4, the trial remains on track to generate data by mid-2020 from the Phase I combination of FPA150 and pembrolizumab in a cohort of patients with B7-H4 overexpressing ovarian cancer. Last year at ASCO and at ESMO, we presented safety and preliminary efficacy data from the Phase Ia/Ib clinical trial of FPA150, showing that it is well tolerated in both monotherapy and in combination with pembro. We reported 2 confirmed monotherapy responses in ovarian cancer, but this is a response rate that is not sufficient for Five Prime to move forward in developing the compound as a single agent.

We continue to evaluate FPA150-pembro combination in patients with ovarian cancer that overexpress B7-H4. But given our resources and priorities, we do not plan to advance the development of the combination independently in the near term. As a reminder, B7-H4 is homogeneously overexpressed in approximately half of ovarian, endometrial and both hormone receptor-positive and triple-negative breast cancer. This information, combined with the lack of off-target toxicity, suggest that B7-H4 may be a good target for antibody drug conjugates, bispecific antibodies or CAR-T therapies.

Turning now to FPT155. This is our first-in-class CD80-Fc fusion protein that directly engages CD28 without superagonism and binds to CTLA-4, promoting T-cell activation in the tumor microenvironment. We have completed 9 dose escalation cohorts, and the trial remains on track to generate early monotherapy efficacy data in the second half of 2020. As we had predicted, based on our preclinical data and the pharmacokinetics of the drug, we are beginning to observe expected pharmacodynamic changes, specifically we’re observing an increase of central memory T-cells in the peripheral blood, and we are encouraged by this finding as it supports the predicted mechanism of action. Based on this data, we are now identifying patients with tumors that are more likely to have preexisting T-cell infiltration as these are the types of tumors that are more likely to respond to single-agent FPT155. These tumors, which are known as warm or hot tumors, include lung cancer or melanoma, and we have opened enrollment in South Korea, where there’s a large lung cancer patient population.

I also want to add that while we anticipate single-agent activity of FPT155, we have decided to amend the trial to add a parallel dose escalation of FPT155 in combination with pembrolizumab. We’re doing this for 2 reasons: first, preclinical data suggests combining an anti-PD-1 with FPT155 will be synergistic; and second, as PD-1 inhibitors continue to move to earlier and earlier lines of therapy in warm and hot tumors, it’s important, looking to the future development, that we demonstrate the safety and tolerability of the combination.

Moving to our partner programs. BMS recently informed us that their randomized Phase II trial, cabiralizumab plus nivolumab with and without chemotherapy in second-line pancreatic cancer, did not meet its primary endpoint. BMS also informed us that they have no near-term plans for additional sponsored development of cabiralizumab, but will continue to support the evaluation of cabira in select ongoing investigator-sponsored trials.

And finally, BMS-986258, an antibody targeting TIM-3, which is an immune checkpoint receptor, continues to enroll in the Phase I portion of the Phase I/II trial in combination with nivolumab.

I will now turn the call over to David.

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David V. Smith, Five Prime Therapeutics, Inc. – Executive VP & CFO [5]

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Thanks, Helen. Details regarding our financial results can be found in the press release that we issued this afternoon.

Turning to our cash position. We finished 2019 with a strong balance sheet. Cash, cash equivalents and marketable securities totaled $157.9 million as of December 31, 2019, compared to $271.7 million as of December 31, 2018. The decrease was attributable to cash used in operating activities throughout the year.

Collaboration and license revenue for the fourth quarter of 2019 decreased by $800,000 or 20% to $3.2 million from $4 million in the — for the fourth quarter of 2018. The decrease was primarily due to the completion of the research term of our immuno-oncology research collaboration with BMS in March of 2019.

Collaboration and license revenue for the year ended December 31, 2019, decreased by $35 million or 70.1% to $14.9 million from $49.9 million for the year ended December 31, 2018. Lower revenue was the result of a decrease in revenue recognized under several partner collaboration agreements, including our October 2015 cabira collaboration agreement, our November 2014 collaboration agreement and our immuno-oncology research collaboration agreement with BMS as well as lower collaboration revenues from our partnerships with Zai Lab and UCB.

Research and development expenses for the fourth quarter of 2019 decreased by $8.8 million or 25.4% to $25.9 million from $34.7 million versus the fourth quarter of 2018, primarily due to lower compensation costs resulting from corporate restructurings undertaken in 2019, decreased clinical trial expenses related to the cabira study, lower preclinical costs, reduced use of temporary resources, clinical services, specialty, laboratory services and lower manufacturing costs for bema and FPA150. These decreases were partially offset by impairment charges for lab equipment and higher companion diagnostic expenses related to bema.

Research and development expenses for the year ended December 31, 2019, decreased by $42.3 million or 27% to $114.1 million from $156.4 million for the year ended December 31, 2018. The decrease was attributable principally to lower compensation costs resulting from corporate restructurings undertaken in 2019, a milestone payment made to a partner in 2018, along with lower preclinical program, clinical service expenses, decreased companion diagnostic clinical trial expense, the use of fewer temporary resources and lower allocated costs resulting from the restructuring. These savings were partially offset by higher bioanalytic and specialty laboratory and clinical trial expenses that were required to advance the bema and FPA150 programs as well as an impairment charge for lab equipment.

General and administrative expenses for the fourth quarter of 2019 decreased by $200,000 or 2.2% to $9.4 million from $9.6 million in the fourth quarter of 2018.

General and administrative expenses for the year ended December 31, 2019, increased by $3.1 million or 7.8% to $42.7 million from $39.7 million. The increase was primarily the result of higher allocated costs related to the corporate restructurings, higher compensation costs and professional services fees that were partially offset by a reduction in the use of temporary resources.

Net loss for the fourth quarter of 2019 was $31.4 million or $0.89 per basic and diluted share compared to a net loss of $38.8 million or $1.12 per basic and diluted share for the fourth quarter of 2018.

Net loss for the full year of 2019 was $137.2 million or $3.92 per basic and diluted share compared to a net loss of $140.4 million or $4.13 per basic and diluted share for the full year of 2018.

Looking ahead, we expect full year net cash used in operating activities to be between $77 million and $82 million, and we estimate ending 2020 cash, cash equivalents and marketable securities to be between $77 million and $82 million.

At this time, I’d like to turn the call back to the operator for Q&A.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from Chris Shibutani of Cowen and Company.

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Chris Shibutani, Cowen and Company, LLC, Research Division – MD & Senior Research Analyst [2]

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A question on the pipeline for the CD80 compound. I believe you have now plans to move into small cell lung cancer and the details of non-small cell involving work — with clinical trial work in Korea. I believe then you would be looking to go into first-line setting naive patients. So can you help frame for us what your expectations are in terms of what we might learn from this work?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [3]

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So hi, Chris. This is Helen. I’ll start with answering that. So thank you for the question. So give me a chance to clarify. I think how we design this trial is that, and you’ve heard us say this many times before, we had to start at an exquisitely low dose because of the history of people attempting to target CD28 before causing superagonism. And so initially, what we do, as you know, in a lot of these trials, is we take all comers and then do our dose escalation and that is still continuing on the dose escalations. As I said, we’ve cleared 9 cohorts. I think the question then comes about in parallel to as we’re dose escalating with all comers, when do we start, if you will, I’ll use the term backfill or I will use the term exploratory cohort, start enrolling some patients, which maybe are a little trickier to find, that, that we can — that we would really actually expect to have a higher chance of seeing a response based on the mechanism of action. And so the comment about non-small cell was just an example of, obviously, a patient population that would fit that criteria of having a warm, hot tumor.

One of our reasons to go to South Korea is because there are a lot of lung cancer patients there. But for this exploratory cohort, it wouldn’t be just limited to non-small cell. We would be willing to take non-small cell, melanoma, renal cell, anything where clearly PD-1, CTLA-4 drugs have been approved. We do have an exclusion criteria, patients cannot have received a CTLA-4 agent, but they can have received PD-1. So for these exploratory, these will not be necessarily naive patients. And again, our reason to start adding these cohorts now really has to do with at lower — we’re starting to see the PD changes, the changes in the blood that you’d expect to see. So it’s taken a while to get to a dose where we think that we might be at that dose level.

Does that make sense how we design and what we’re doing?

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Chris Shibutani, Cowen and Company, LLC, Research Division – MD & Senior Research Analyst [4]

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Yes. No. That’s very helpful. And then if I could just ask another question on bema. You began to describe some of the different options that you’ll have as we get through the futility analysis, including, I believe, potential to convert this over to Phase II-type randomized work. Would you need to have that study closed such that a potential partner might continue, but would they have to essentially restart again? Just trying to understand the logistic mechanics of what a potential partner will be faced with.

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [5]

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Yes. So I think it’s important to point out that we don’t have any new information. Again, we have a DMC. They look at — this is a double-blind trial. They look at the data. Their recommendations have been to continue without change from a safety point of view. And again, because it’s double-blind, we don’t look at the efficacy. But at the same time, again, with the world that we live in and you’ve heard the news about cabira and there are other priorities, and to be honest, from our early — maybe excitement is too strong a word, but interest in what we’re seeing in 155, we’re trying to think of how best to spend our resources. So we’re trying to be — as you know, we’ve been looking for a partner with bema for a while and we’ve said that. And I think what we’re trying to do is acknowledge that there is a potential we might not find one, even if we pass futility and what are things that we might do.

In answer to your question, first step is to pass futility and see if that — where that puts us. But if we do not have a partner, unless something changes otherwise, we would likely, at that point, amend the trial and then that would make it to a Phase II. Now when we would actually make the data public about that Phase II, again, depends on what events are and what we would get the most information on, but it’s only if we make that change to the Phase II, we’d be able to talk about the data, right, because a futility is just kind of thumbs up, thumbs down as far as the public disclosure.

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Chris Shibutani, Cowen and Company, LLC, Research Division – MD & Senior Research Analyst [6]

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Got it. Okay. We’ll continue to pay attention to the progress.

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Operator [7]

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And our next question comes from Jonathan Chang of SVB Leerink.

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David Simms Ruch, SVB Leerink LLC, Research Division – Associate [8]

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This is David Ruch on for Jonathan. I guess just to go back to the last question and to clarify here, you mentioned the DMC and the unblinding of the FIGHT study — or the not wanting to unblind the FIGHT study. So I guess assuming you pass futility, will there be any data that you’re available to share either publicly or with a potential partner? Or will we kind of be going just based on the passing of futility?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [9]

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Yes. So for futility, again, the only people that look at the unblinded data are the DMC. And then what happens is we say our bar is at x, and we haven’t made that public what that would be. And the DMC will come back to us and say, yes, you passed, or no, you did not pass. And so that’s all that happens with the futility. If we have a partner that’s going to support the trial going forward, that’s all we need, right? We just need to show that this trial is powered appropriately to show the endpoints, the partner agrees with that and we would resume enrollment at that point. But what we’re trying to make it clear now is if we do not have a partner, Five Prime has made a decision, we would not move forward on our own with a Phase III as designed right now. So if nothing else changes. Is that clear now? If anybody in the room would…

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David Simms Ruch, SVB Leerink LLC, Research Division – Associate [10]

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Yes. So that’s…

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [11]

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Yes, yes. And again, we just think it’s prudent. I mean it’s nothing. And I just want to make sure it’s not based on us thinking that anything is negative about the data, again, because that’s blinded. It just has to do with what else we have in our portfolio, our resources and we have to pick and choose, right, how best to spend our resources. And a large Phase III trial in a disease that has historically been difficult to treat, I think if we have other things in our pipeline, may not be the best way to choose to spend those resources.

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David Simms Ruch, SVB Leerink LLC, Research Division – Associate [12]

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Got it. And then for the CD80 program, could you elaborate a little bit on the rationale behind the PD-1 combo cohort and particularly with patients who have previously received PD-1, who, I believe, you mentioned with you on the study? And then when we might see initial data from the combination?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [13]

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Yes. So I think we want to make it again clear that this is a drug that we think will have single-agent activity. And — but at the same time, as you know, one of the mechanisms of action is through CTLA-4. So CTLA-4 alone drugs have moderate activity. And I think the world continues to move on, right? So you don’t see a lot of patients out there just getting YERVOY, for example. People are getting PD-1 plus YERVOY. They are getting PD-1 plus chemo. So I think what we’re trying to do is really look to the future of where therapies are going to be. So obviously, for us, the #1 thing is to show the single-agent activity, and nothing has changed about that trial design. And that’s what we’re concentrating on in terms of enrolling patients from South Korea, et cetera, who will have tumors that we think will be able to show that.

But again, we’re trying to also plan for the future. And so we think it makes sense the way this drug works that we at least in those — that we show that you can add this to a PD-1 that we think would increase the value of the drug. And then, of course, we have preclinical data, which we’ve actually presented at AACR and also within our background of our poster, I believe at SITC, but I know we presented at ACR, that shows really significant synergy with the 2. So there’s also, obviously, in the end, that’s the best reason is that the 2 drugs together will be more efficacious than FPT155 alone.

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David Simms Ruch, SVB Leerink LLC, Research Division – Associate [14]

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Got it. And then just one more from us. Could you provide any additional color you could provide on the SGEN deal? And which targets of yours might make sense as an ADC?

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William R. Ringo, Five Prime Therapeutics, Inc. – Chairman of the Board & CEO [15]

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We are not disclosing the target as per the contract. We’re obviously excited about the opportunity to work with Seattle Genetics. They’re a leader in the ADC space. And we feel really, really good about the progress to date, the transaction and the interactions between the companies.

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Operator [16]

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And the next question comes from Steve Seedhouse of Raymond James.

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Timur Ivannikov, Raymond James & Associates, Inc., Research Division – Senior Research Associate [17]

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This is Timur Ivannikov on for Steve Seedhouse. And our first question, I just wanted to clarify on bema. I think in the past, if we remember correctly, in the past, you mentioned that some of the people at Five Prime could see more data from the — from DMC, not just the pass/fail. Is that still the case? Or is it back to just seeing whether it passed or failed?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [18]

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So yes, I guess from the previous question, I was trying to make the distinction between what one might say publicly versus not. So certainly, there can be a couple of people who are not directly involved with the conduct of the trial who can know the details of the thumbs up, thumbs down passing futility. But in terms of them being able to say anything publicly, it will just be a yes, no.

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Timur Ivannikov, Raymond James & Associates, Inc., Research Division – Senior Research Associate [19]

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Okay. And then, I guess another follow-up question on the FPT155 program. I think you mentioned South Korea, and you didn’t really say what the time line is, but obviously, there’s a coronavirus issue there now. So what do you think about in terms of the duration of this trial now, the combination study versus what it would have been normally?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [20]

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Right now, we don’t have any indication that the coronavirus outbreak in South Korea is going to affect any of our time lines. We have patients that have — that are — may dose imminently, I mean, so that’s all I can say right now. Yes. And we’re also in Australia. Thank you. Somebody here is reminding me that the trial continues in Australia and, of course, patients can also enroll from there. So…

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Timur Ivannikov, Raymond James & Associates, Inc., Research Division – Senior Research Associate [21]

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Okay. Okay. Great. And I guess the final question. So a follow-up on cabira. So I think you mentioned BMS doesn’t really have near-term plans for sponsoring additional trials. But I mean this asset, I mean, it could be used in other indications. And could you remind us whether you could potentially give your rights to another company to run another study or somehow restructure the deal because otherwise, this asset will be sitting idle?

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William R. Ringo, Five Prime Therapeutics, Inc. – Chairman of the Board & CEO [22]

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That’s a great question and I think maybe one we’ll have to come back to you on. I don’t believe we have the rights to do that. But if you’d give us a little bit of time, we’ll go back and check and make sure and then come back and answer your question specifically.

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Operator [23]

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And our next question comes from Eric Joseph of JPMorgan.

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Turner Andrew Kufe, JP Morgan Chase & Co, Research Division – Research Analyst [24]

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This is Turner on for Eric. So on the Phase III FIGHT futility analysis, I’m curious what type of events is it based on? Is it PFS or OS? And then in a situation that you do have to convert to a Phase II study, to what extent does the futility analysis on the 150 existing patients potentially just serve as the Phase II? And then I have a couple of follow-ups.

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [25]

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Right. So to make sure that I understand, so your first question has to do with, are we using OS or PFS? And again, so to be clear, with the futility, we’re giving guidance, right, it’s not something that’s included directly in the protocol. It’s not a regulatory issue. So right now, we will be having the DMC provide information on both of those, but it is based on overall survival and that’s because, at least, that is the primary endpoint of the Phase III trial.

And then in answer to your question of, should we switch to a Phase II? So again, should we pass futility, we do not have a partner. And again, that’s — the comment about the Phase II is just one of many possibilities we were giving as an example that could be done. I think, I guess my short answer would be yes. I think 150 patients for a randomized Phase II trial, so the difference that we would like to see when you add bema to a backbone of chemo, that would be enough patients.

Now when would be the best time to read out that Phase II, I do not want to imply that, that would be right after the futility. We may choose to wait longer and get more events.

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Turner Andrew Kufe, JP Morgan Chase & Co, Research Division – Research Analyst [26]

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Okay. And then to follow up on that, how long are you giving yourselves to arrive at a strategic or partnering decision post the futility analysis or beforehand?

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William R. Ringo, Five Prime Therapeutics, Inc. – Chairman of the Board & CEO [27]

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Haven’t made that decision yet.

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Turner Andrew Kufe, JP Morgan Chase & Co, Research Division – Research Analyst [28]

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Okay. Then one last quick one for me. You provided guidance — or OpEx guidance. What does that assume in terms of FIGHT trial resumption as well as advancing FPA150?

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David V. Smith, Five Prime Therapeutics, Inc. – Executive VP & CFO [29]

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So we provided cash burn, which is a little bit different than the OpEx. But the — this assumes that we are funding the FIGHT trial through futility and then following patients and all the requirements that we have with that and then funding FPA150 through the combination readout and any other costs that follow on from that. So as Helen laid out earlier, we do not have plans to take FIGHT or the bema program forward without a partner. So there are no Phase III costs beyond the futility that we have considered in our guidance.

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [30]

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But we will just clarify that the example of where we switch to a Phase II, we have included that, that it’s not just to whenever futility happens but following, as you said, all of those 150 patients out for survival. So that is included.

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Operator [31]

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And our next question comes from Etzer Darout of Guggenheim Securities.

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Paul Jeng;Guggenheim Securities;Equity Research Associate, [32]

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This is Paul Jeng on for Etzer. Just a quick one, looking forward to the futility analysis for FIGHT. You’ve previously spoken about the HER2 overexpression population in gastric cancer, possibly reading through to FGFR2. How should we be thinking about parallel to the ToGA trial or other related clinical or preclinical data sets as we look ahead towards the analysis?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [33]

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I’m not sure that I understand the question. But do you mean in terms of how the ToGA trial was designed or…

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Paul Jeng;Guggenheim Securities;Equity Research Associate, [34]

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Sure. Is there anything from the readout or the design of the trial that could help us and looking forward towards your analysis?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [35]

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No. I mean I — no, I have not that — and again, having not — we only know about the ToGA trial what’s in the public domain. So — and certainly — so not that I can think of. And again, part of it is I’m not sure that I understand what — maybe you can give me an example of what kind of thing that you’re…

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Paul Jeng;Guggenheim Securities;Equity Research Associate, [36]

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No. That’s all right. I have another question then. So switching gears to FPA150. So for the combination with Keytruda for patients with ovarian cancer, do you have any projection on when or what circumstances you might revisit advancing this combination in development?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [37]

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So as we said, what we expect to do is get efficacy data from this about midyear. And in terms of what else — because I guess you’re right, we made a comment specifically about near term. I think there, what we need to do is, and we’ve said this previously, is not just look at the data that comes out of that as well, particularly for the PD-1 combination, wanting to look and see what was the expression of PD-L1 on the tumors. We do have patients that continue on monotherapy and are having longer than one would expect durable stable disease. So there’s some data-digging that we would want to go into. I think our point today is we, again, wanted to highlight that as we’re determining what program do we want to prioritize and what ones we’re not prioritizing, that if we were to continue with a combination and, again, we don’t have the data yet from the combination, but a combination with 150 and a PD-1, we would want a partner because those trials are expensive to run.

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Operator [38]

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And our next question comes from Tony Butler of Roth Capital.

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Charles Anthony Butler, Roth Capital Partners, LLC, Research Division – MD, Senior Equity Analyst & Head of Biotechnology Research [39]

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Helen, 2 questions. The first is a part to — is 2 parts, sorry. When we think about 155, I noticed in clin trials that all of the participating sites, 12 I counted, were all OUS. Is that correct? And maybe why would you not have enrolled patients from the U.S.? That’s number one. Number two is, is it fair to simply think of 155 perhaps as a substantially superior YERVOY? Okay, that’s question one. And then number two is on 150. Again, please correct me if I’m wrong, I seem to remember that at least in the initiation of the study, there were also breast cancer patients. You seem to have limited to ovarian. Did you enroll any breast cancer patients? That’s part 1 of that question. Then number two is, I think the trial is just under 300 total patients. The question really is, how many — is it possible that we see midyear at that time point when you will provide data in combination with pembro? Appreciate it.

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [40]

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All right. No, that’s great. So in terms of 155 being done ex U.S. So you are right that, originally, we started the trial in Australia. We did that because they were quick to get going. We had investigators that knew a lot of a — about developing immunologic or I-O drugs, if you will. And also, at that time, there was less ubiquitous use, if you will, of PD-1. So we were hoping that during our dose escalation, we would have fewer patients that have been exposed to a PD-1, which might make it easier to see efficacy as we dose escalated. Now of course, the time has changed and there’s more and more use of PD-1 globally, so I can’t necessarily say that’s borne out. But I can say that the Australian investigators have been great to work with and really helped us enroll quickly.

In terms of adding in South Korea rather than the U.S., that really has to do, quite frankly, with our CRO and, again, where patients are. So we are in a situation now where we could soon enroll in the U.S. if we wanted to, but right now, we’re sticking with ex U.S. So there’s not a — there’s not any other specific reason other than we thought it was speed and to enroll the right kind of patients that we wanted on the trial.

In terms of, could this be a substantially superior YERVOY? I guess I’d be happy with a substantially superior YERVOY, so as long as that substantial is substantial. So I don’t know if there was sort of a third part of that of what you were trying to get at there. I mean…

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Charles Anthony Butler, Roth Capital Partners, LLC, Research Division – MD, Senior Equity Analyst & Head of Biotechnology Research [41]

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Yes. Well, yes, there wasn’t really a third part. I mean I could create a third part, obviously, but looking at the notion that it’s — I mean because it’s — you’ve had to rule out CTLA-4s in — or patients who have CTLA-4 in the past and you obviously can use PD-1 in combo. It’s kind of like the CTLA-4, PD-1 combinations as you alluded to. But yet again, those have been not terribly great. And that’s why I just created a better YERVOY that’s…

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [42]

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Yes, yes. I mean and I think you’re right. I mean if you take some tumor type and they have a 15% chance to YERVOY alone and then you combine with a PD-1 and there’s now a 45% chance, I think that you’re sort of speaking to why we want to have combination data because let’s just say — and again, I’m not giving any tumor type. Suppose we had a 35% response, that would — that’s way better than YERVOY alone, but that’s not necessarily better than a YERVOY plus a PD-1. So again, we just sort of want that as a way to mitigate if our efficacy is, as you said, significantly better than YERVOY, but not as good as a PD-1 plus YERVOY, then we want to make sure we have that data as well, right?

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Charles Anthony Butler, Roth Capital Partners, LLC, Research Division – MD, Senior Equity Analyst & Head of Biotechnology Research [43]

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Yes, ma’am. I agree. Absolutely.

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [44]

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So now about your 150 question, so at ASCO last year, we did present — we — you are right, your memory is correct. We had 3 expansion cohorts: breast cancer, where we allowed patients who are either hormone receptor-positive or triple negative; ovarian cancer; and endometrial cancer. We stopped enrollment at — we did a variation of a Simon two-stage. So we stopped enrollment unless we saw a certain number of responses, and we only saw responses in ovarian cancer. So that’s what made us choose only ovarian cancer for the combination, and we did not continue to enroll in the breast cancer cohort.

Then in terms of the n equals 300, the clinical trial was written that way because that would have been if we’d gone to full enrollment for every single cohort, including the combination. So that’s where — so we have not enrolled 300 patients in total. And so — and then in terms of — and then we have not said exactly how many have been in our combination cohort, but I can tell you that our same approach is this Simon two-stage that will enroll a certain amount. We’ll look and see, make sure that we’re getting a response that we’d want to see before we continue enrolling.

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Operator [45]

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(Operator Instructions) Our next question comes from Jim Birchenough of Wells Fargo Securities.

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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division – Director & Associate Analyst [46]

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Actually, this is Nick on for Jim Birchenough. First question, can you make some comments about where you are in partnership discussions for bema and 150? And specifically for bema, if you don’t have a partner lined up as it were once — if there’s a positive decision for futility, it takes you 6 months to get a partner. Could there be an issue with equipoise maintaining equipoise-met study since you’ll be past the median, expected median on overall survival and then imbalance may become obvious?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [47]

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All right. It’s not a great connection, but I think if I heard you…

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William R. Ringo, Five Prime Therapeutics, Inc. – Chairman of the Board & CEO [48]

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It was really, really kind of hard to hear your question. Could you repeat it again for us?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [49]

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I think I heard — actually, Nick, I did hear it, but I’m going to repeat it for everybody in the room. So you’re saying that with bema, if we’ve — where are we in terms of finding a partner? And presuming you don’t find a partner until you pass futility, what if that meant then 6 months to negotiate a deal, what would that mean for the trial itself? So I guess the first question is…

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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division – Director & Associate Analyst [50]

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Yes. Whether it affects equipoise? Assuming that you’ll pass the median, expected median on overall survival, so an imbalance may become clear and…

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [51]

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Sure. So maybe first about the partner, maybe about the partner…

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William R. Ringo, Five Prime Therapeutics, Inc. – Chairman of the Board & CEO [52]

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Maybe it’s — I think it’s fair to assume that we’re not waiting until futility to start any kind of discussions from a partner standpoint. So some of those discussions that are ongoing may not get a decision on a partnership to turn the card over on futility. But the process will be pretty far along by the time we get there.

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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division – Director & Associate Analyst [53]

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Okay. And the same would go for 155 — I mean 150, I’m sorry, in terms of partnership?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [54]

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Yes.

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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division – Director & Associate Analyst [55]

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And then moving to 155, so Helen, has dose escalation now been completed?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [56]

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No, it has not. So we’re continuing the dose escalation in parallel. Yes.

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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division – Director & Associate Analyst [57]

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And then you sort of mentioned, you’ve got this pharmacodynamic marker of central memory T-cells. From a translational perspective, have you looked at what are these T-cells recognizing? Are they recognizing potentially tumor antigens?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [58]

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So that is included in our PD analysis, but that work is ongoing. I guess that’s the best way to say that. I don’t have any data for you.

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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division – Director & Associate Analyst [59]

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Okay. And then final one on 155 and then I have a follow-up. Final one on 155 is, so you’re going to combine with a PD-1 inhibitor. I mean the obvious thing to do is just combine the label dose of the PD-1 inhibitor with perhaps the highest dose you’ve tested on 155. But from a preclinical perspective, is that the optimal strategy, do you think? Or does it make sense to try and look at optimizing the dosing of these 2 agents when you move to combination therapy?

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Helen Louise Collins, Five Prime Therapeutics, Inc. – Executive VP & Chief Medical Officer [60]

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Well, since the PD-1 is approved in most of the tumors that we would be looking at, kind of a situation, you have to start off by them getting the full dose. And we do think there is significant synergy based on a preclinical data that we will not be able to start with full dose of 155. So we are truly doing a dose escalation first, which is a little different than 150. So — but I think based on the mechanism of action in our preclinical data, we think that we should dose escalate by — or dose reduce the 155 by a couple of cohorts.

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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division – Director & Associate Analyst [61]

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Okay. And then just finally on the new preclinical assets, when might we hear on what those assets are?

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William R. Ringo, Five Prime Therapeutics, Inc. – Chairman of the Board & CEO [62]

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Repeat the question again, please. I’m sorry, it was muffled.

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Nicholas M. Abbott, Wells Fargo Securities, LLC, Research Division – Director & Associate Analyst [63]

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Yes. I’m sorry. You said — I think you said in your prepared comments that you have 3 late-stage research programs, one of which might come into preclinical development later on this year. When might we find out more detail on the 3 programs and I guess specifically on the candidate to move to preclinical development?

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William R. Ringo, Five Prime Therapeutics, Inc. – Chairman of the Board & CEO [64]

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Well, when we make a determination in terms of the development of that compound, the timing around that, we’ll release that. But we haven’t really released any of the targets at this point in time or made them public. So I suspect before the end of the year, you’ll know more about that, but we’re not ready to talk about it yet.

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Operator [65]

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And ladies and gentlemen, this does conclude our question-and-answer session. I would now like to turn the call back over to Bill Ringo for any closing remarks.

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William R. Ringo, Five Prime Therapeutics, Inc. – Chairman of the Board & CEO [66]

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Thank you very much. And as I said at the beginning of the call, the restructuring that we undertook in 2019 has successfully been implemented. We’re in a position where our cash runway, as David mentioned earlier, extends into 2022. And really, our focus for 2020 is on generating clinical data from our proprietary programs. We see the pipeline growth potentially coming from future development of our clinical assets from internally developed late-stage research programs and from the possibility of acquiring an asset externally. We believe this multipronged approach will result in a prudent advancement and prioritization of our pipeline.

With that, I’d like to thank all of you for joining us today for your interest in Five Prime. I’d also like to thank the patients and investigators participating in our clinical trials and our Five Prime employees and our strategic collaborators, who all contribute to the continued advancement of our programs. Thank you for your attendance today.

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Operator [67]

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