Allogene Therapeutics Q2 2024 Earnings Report

Allogene Therapeutics EPS Results

• Actual EPS: -$0.32
• Consensus EPS: -$0.35
• Beat/Miss: Beat by +$0.03
• One Year Ago EPS: N/A

Allogene Therapeutics Revenue Results

• Actual Revenue: N/A
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Allogene Therapeutics Announcement Details

• Quarter: Q2 2024
• Date: 8/7/2024
• Time: N/A
• Conference Call Date: Wednesday, August 7, 2024
• Conference Call Time: 5:00PM ET

Allogene Therapeutics (NASDAQ:ALLO) is a clinical-stage biotechnology company focused on developing allogeneic, or “off-the-shelf,” chimeric antigen receptor T-cell (CAR T) therapies to treat a range of hematologic malignancies and solid tumors. The company leverages gene-editing technologies to generate universally compatible engineered T cells, aiming to overcome the limitations of patient-specific CAR T approaches such as manufacturing delays, variable product quality and treatment resistance.

The company’s pipeline includes multiple allogeneic CAR T candidates targeting key antigens in blood cancers. Lead programs include ALLO-715, an anti-BCMA therapy for multiple myeloma, and ALLO-501, which targets CD19 for non-Hodgkin lymphoma and other B-cell malignancies. Allogene applies proprietary TALEN gene-editing to disrupt the endogenous T-cell receptor and other genes, reducing the risk of graft-versus-host disease and enabling repeat dosing possibilities.

Headquartered in South San Francisco, California, Allogene collaborates with global partners to advance its off-the-shelf portfolio. A strategic alliance with Servier grants the European-based pharmaceutical company exclusive ex-U.S. rights to develop and commercialize select Allogene candidates. This partnership supports clinical development across North America, Europe and other key oncology markets.

Founded in 2017 as a spin-out from Kite Pharma, Allogene Therapeutics went public in 2020 to support the rapid advancement of its clinical programs. The company is led by President and Chief Executive Officer David Chang, whose background spans immuno-oncology research and strategic biotech leadership. Under his direction, Allogene aims to establish allogeneic CAR T as a new standard in cell-based cancer treatment.

Allogene Therapeutics Q2 2024 Earnings Call Transcript

Key Takeaways

• We launched the Alpha-3 trial for Semicel as a first-line consolidation therapy in LBCL using MRD biomarkers and opened 10 community and academic sites within weeks, aiming to change the standard watch-and-wait approach.
• Allogene has secured strong FDA engagement supporting the trial’s innovative design of earlier-line CAR T use, MRD-guided patient selection, and potential to improve safety and efficacy.
• In Q2, we began manufacturing all CAR T investigational product in-house at our South Forge 1 facility, significantly reducing reliance on contract manufacturers and strengthening strategic capacity.
• The company ended Q2 with approximately $445 million cash runway extending into H2 2026, reported a net loss of $66.4 million, and reiterated full-year 2024 GAAP operating expenses of ~$300 million.
• The next-generation allogeneic dual CD19/CD70 CAR T (ALLO-3-29) for autoimmune diseases, built on our DAGR technology and CRISPR editing, remains on track for an IND filing in Q1 2025 and proof-of-concept by end 2025.

Presentation

[Operator]

Hello, and thank you for standing by. Welcome to Allogene Therapeutics' second quarter 2024 conference call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. To ask a question during this session, you will need to press star one one on your telephone. You will then hear an automatic message advising your hand is raised. To withdraw your question, please press star one one again. I would now like to turn the call over to Christine Cassiano. You may begin.

[Christine Cassiano, Executive Vice President at Allogene Therapeutics]

Thank you, operator, and welcome to all who have joined this call. After the market closed today, Allogene issued a press release that provides a business update and financial results for the second quarter of 2024. This press release and today's webcast are available on our website. Following our prepared remarks, we will host a Q&A session. We recognize that historically, questions have been multifaceted, but note that we will endeavor to keep this call to under an hour. Joining me today are Dr. David Chang, President and Chief Executive Officer; Dr. Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer; and Jeff Parker, Chief Financial Officer. During today's call, we will be making certain forward-looking statements.

[Christine Cassiano, Executive Vice President at Allogene Therapeutics]

These may include statements regarding the success and timing of our ongoing and planned clinical trials, data presentations, regulatory filings, future research and development efforts, manufacturing capabilities, the safety and efficacy of our product candidates, commercial market forecasts, and 2024 financial guidance, among other things. These forward-looking statements are based on current information, assumptions, and expectations that are subject to change. A description of the potential risks can be found in our press release and latest SEC disclosure documents. You are cautioned not to place undue reliance on these forward-looking statements, and Allogene disclaims any obligation to update these statements. I'll now turn the call over to David.

[David Chang, President and CEO at Allogene Therapeutics]

Thank you, Christine, and welcome to those on the call today. We hope you've all enjoyed a pleasant summer so far. As I think about the first half of 2024 for Allogene, the word that continually comes to mind is momentum. Early in 2024, we reset the clinical development plan by advancing cema-cel, our lead CD19 allo CAR T product, into an LBCL first-line consolidation study and announced our decision to develop and advance our next-generation allo CAR T product, ALLO-329, into autoimmune indications, thereby placing Allogene in an enviable position of having clinical programs in heme malignancies, solid tumors, and autoimmune indications. Hard work creates opportunities, but external factors must line up to create and build momentum.

[David Chang, President and CEO at Allogene Therapeutics]

As we think about the two programs we get asked about most often, ALPHA3 with cema-cel and ALLO-329 in autoimmune, momentum is on our side. To be clear, this does not mean that it has been easy. Our team is working harder than ever, but that same hard work and dedication, along with the bold choices we've made over the last year, set off a chain reaction that we see daily as we work with investigators and external stakeholders on our programs. Simply put, the reset that was based on our long-standing conviction on our allo CAR T programs have put us in a position to potentially change the CAR T landscape. Momentum for us is merely a starting point.

[David Chang, President and CEO at Allogene Therapeutics]

Now that we have shifted strategy into a clear and honorable leadership position, our programs continue to build speed, and it has been remarkable for our lead program, ALPHA3. I will spotlight three measures that may not be as visible to investors as they are to us internally at Allogene. First, while the market is not kind to biotech right now, we strengthened our base of investors in this last round with some of the highest caliber investors any company could hope for. We don't take that for granted. Second, the number of sites who want to participate in our ALPHA3 trial and the energy with which they are engaged can be likened to what we saw in the early days of autologous CAR T. There seems to be undercurrent of understanding that this trial has the potential to forever change their practices.

[David Chang, President and CEO at Allogene Therapeutics]

Third, the collaborative engagement from the FDA on this trial has been illuminating. We believe we have achieved support for ALPHA3 based on three key benefits that stem from the innovative study design. One, advancing CAR T into early line setting maximizes the curative potential of the modality. Two, treating minimum residual disease, or MRD, the lowest disease volume one can measure, has the potential to make CAR T safer and more effective. And three, using MRD to select and treat only the patient who will likely experience recurrence makes ALPHA3 design very efficient, concentrating treatment in only the patient population who needs it and leaving everybody else alone. We believe these key points are well aligned with the views of FDA and other key stakeholders. We aim to validate the support for this trial.

[David Chang, President and CEO at Allogene Therapeutics]

We have also continued to strengthen Allogene, even if not in the spotlight or something that garners headlines, to ensure that we can deliver on our promises, such as the work done in our Cell Forge 1 facility in the East Bay, where we now manufacture all of our CAR T investigational products. This significantly minimizes our reliance on contract manufacturers for the products and provides Allogene with a critical strategic asset, the manufacturing capacity to serve the market that we are addressing in our trials. As the months continue, I am confident that this exceptional momentum we feel internally will become increasingly evident to the outside world. I will now turn the call over to Zach to discuss the programs of most significant interest to investors.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Thank you, David. As most of you know, our development focus in 2024 has been on our four core programs, cema-cel for first-line consolidation in LBCL and relapsed/refractory CLL, ALLO-329 in autoimmune, and ALLO-316 in renal cell carcinoma. While our CLL and renal cell programs continue to move forward as planned, with a meaningful update from the RCC trial planned by year-end, I will focus my remarks today on the two programs that we get most asked about, cema-cel in first-line consolidation and ALLO-329 in autoimmune disease. I'll start with our lead program, cema-cel and the ALPHA3 trial, which we initiated in June. In just a few weeks, following the Investigational Device Exemption, or IDE, approval in mid-June, we've opened the first 10 community and academic cancer centers and have been successfully screening patients.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

The speed with which we've been able to bring community cancer centers into the trial, in particular, speaks volumes for what this may mean commercially and reinforces our belief that an allogeneic CAR T option will be what opens the door to this modality for these centers where most patients are treated. First-line chemoimmunotherapy for LBCL has largely gone unchanged for a quarter century, and for good reason. R-CHOP and similar regimens work pretty well, with the majority of patients achieving cure with this easy-to-give, safe regimen. However, approximately one-third of patients with LBCL whose disease initially responds to R-CHOP will experience relapse. ALPHA3 is a groundbreaking trial for two reasons.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

First, it is the first prospective trial that will utilize an ultrasensitive biomarker to inform physicians and patients whether the cancer is likely cured by first-line R-CHOP, or if the disease will likely recur and require second-line treatment or beyond. And second, ALPHA3 is the first trial to propose a treatment, namely a dose of cema-cel, for remission consolidation, specifically for those patients who are likely to face a future relapse. If positive, ALPHA3 could mark the beginning of a new era in LBCL treatment, potentially supplanting the current standard of care after frontline treatment, which has for decades been to watch and wait for the disease to relapse. We believe our partnership with Foresight Diagnostics, who is developing a novel and potentially practice-changing test for minimal residual disease, will change that.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

This investigational test, when administered following the completion of frontline treatment for LBCL, has the potential to offer a highly accurate prediction of future disease relapses. ALPHA3, therefore, offers something to all patients who screen. If the screening MRD test is positive, you are potentially eligible to receive a dose of CAR T cells designed to eradicate the residual disease, hopefully attaining the cure which remained elusive after R-CHOP. If the screening MRD test is negative, it could provide assurance that your disease has been fully cured. Peace of mind after a life-altering diagnosis and its treatment cannot be underestimated. Importantly, ALPHA3 builds on the growing understanding that administering CAR T therapies to patients with low disease burden can improve safety and efficacy outcomes. The industry has presented research that illustrates this point.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

cema-cel's Phase 1 safety profile with low rates of CRS and ICANS already permits its use in the outpatient setting in relapsed/refractory patients and may further improve in patients with no radiological evidence of disease. Combine this with the elimination of complex logistics that have hindered CAR T adoption, as well as the reliance on referrals, and we have, as David rightly noted, a clear momentum effect for the ALPHA3 trial with investigators. As we have noted in previous calls, the outcome of this pivotal trial could allow cema-cel to be embedded in the first-line setting where autologous therapies are far less feasible. Consolidating response with an MRD-positive result post R-CHOP requires immediate and definitive action to prevent an impending relapse.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Relapses tend to occur quickly after completion of R-CHOP, in many cases, within weeks to a few months, making the speed to treatment a critical factor in the success of a consolidation strategy like ALPHA3. We bring to the table a truly differentiated CAR T offering that has the potential to break open an untapped market. Few can say that. The first indication of how the trial is proceeding will be when we announce the selection of the lymphodepletion regimen we will continue to the end of the trial. That announcement is expected in mid-2025. The next study milestones will come less than a year later. We expect to complete enrollment in the first half of 2026. The prognosis for patients who are MRD positive at the end of frontline therapy is quite poor, so study events are expected to come in quickly.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Therefore, we expect to perform efficacy analyses in 2026 as well. This will include an independent data safety monitoring board interim efficacy analysis in the first half of 2026, and the data readout of the primary analysis year-end 2026. If the trial is successful, we expect to follow these data readouts with a Biologics License Application submission in 2027.... I'll now discuss ALLO-329. Differentiation is critical across our core programs. We declared our move into the autoimmune space with the goal of resetting the immune system with a single infusion. ALLO-329, our next-generation CD19, CD70 dual CAR, incorporates our Dagger technology, CRISPR-based gene editing, and site-specific CAR transgene integration, and is rationally designed to meet the unique needs of patients with autoimmune disease.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Our Dagger technology provides a potential path to reducing or eliminating lymphodepletion, which we believe may create more development and commercial opportunities for ALLO-329 in autoimmune indications. We are on track to file an IND in Q1 of 2025 and open the trial to enrollment by mid-2025. As a result, we expect to have proof of concept in this trial by the end of 2025. We recognize that highest clinical proof of concept is in lupus, but we also know the importance of differentiation, and the path we are taking provides us the luxury of time to define the best approach while leveraging proof-of-concept data from other trials to consider other indications with unmet need. We expect to provide more detail on our development plan by the end of the year and appreciate the feedback many of you have provided as we chart this course.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

I'll now turn the call over to Jeff to review our latest financials.

[Geoffrey Parker, CFO at Allogene Therapeutics]

Thank you, Zach. Before I dive into the financials, I'd like to express my appreciation to the investors who continue to demonstrate their support for our work. I know this market makes it a challenge, but I assure you, we do not take that support for granted. I could not agree more with David and Zach. The momentum we have at Allogene is palpable, and we believe it will soon be equally evident to the market. Allogene is in a unique position. We control the only clinically validated allogeneic CD19 CAR T product positioned to transform how and where CAR Ts are used in heme malignancies. The recognition for this will only grow over the next six to twelve months as the ALPHA3 program is de-risked. Let me now turn to our financial highlights.

[Geoffrey Parker, CFO at Allogene Therapeutics]

Our cash balance as of the end of Q2 2024 was $444.6 million in cash, cash equivalents, and investments, and we reiterate that our cash runway extends into the second half of 2026. Q2 2024 research and development expenses were $50.4 million, which includes $5.3 million in expenses associated with non-cash stock-based compensation. General and administrative expenses in Q2 were $16.1 million, which includes $8.2 million of non-cash stock-based compensation expense. For Q2 2024, our net loss was $66.4 million, or $0.35 per share, including non-cash stock-based compensation expense of $13.6 million and $5 million in non-cash impairment of long-lived asset expense. For 2024, we continue to expect a cash burn of approximately $200 million.

[Geoffrey Parker, CFO at Allogene Therapeutics]

We expect full year 2024 GAAP operating expenses to be approximately $300 million, which includes estimated non-cash stock-based compensation expense of approximately $60 million. This guidance excludes any impact from potential business development activities. We'll now open the call for questions.

[Operator]

Thank you. Ladies and gentlemen, to ask the question, please press star one one on your telephone and then wait to hear your name announced. To withdraw your question, please press star one one again. We ask that you limit yourself to one question per caller. Please stand by while we compile the Q&A roster. Our first question comes from the line of Salveen Richter with Goldman Sachs. Your line is open.

[Lydia Finnegan, Research Analyst at Goldman Sachs]

Hi, this is Lydia on for Savine. Thanks so much for taking our question. Just on cema-cel in the frontline consolidation setting, could you just speak to any gating factors that might prevent a patient, an MRD-positive patient from opting for cema-cel? And are there any clinical preferences that you're hearing from KOLs, or a setting where this might not be recommended? Thank you so much.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Hi, Lydia, this is Zach. Thanks for the question. So if I understood it correctly, you're asking about what a patient may decide if they come back MRD positive, whether ALPHA3 is the right study for them or not. So, right now, there are no real alternatives for patients who come back MRD positive. There are no approved second-line therapies for patients who are in remission, even if they have an MRD positive result. The only option that they currently have would be in the context of a clinical trial, and the only clinical trial that currently is open for patients who have an MRD positive result at the end of therapy is ALPHA3. So it should be a fairly straightforward decision for patients.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Brian Cheng with JPMorgan. Your line is open.

[Operator]

Hey, guys. Thanks for taking our question today. Maybe just two on ALPHA3. Can you provide some early initial metric on the screen-out rates on MRD positivity? Is it in line with our expectation? And then on the supply side, I just want to follow up on your remarks related to the Cell Forge 1 facility. Can you confirm whether the supply now is actively coming from the Cell Forge 1 for the ALPHA3? And then I have one quick follow-up. Thank you.

[David Chang, President and CEO at Allogene Therapeutics]

... Hey, Brian, this is David Chang. I'll take both of those questions. With respect to the early metrics that we are following for the ALPHA3 study, I mean, you know, we started the study, and as we have made a comment in the prepared statement, you know, there are 10 active sites that are sending patients for screening and enrollment. The metrics that we follow, I mean, certainly, you know, they're internal ones, but and I would consider that these are very standard metrics that any clinical operations team would follow, so there's not anything unique. As the study progressed a little bit more, you know, we will provide be able to provide some information of, you know, regards to, you know, the MRD positive rate and things like that, but right now, it's too early to comment on that.

[David Chang, President and CEO at Allogene Therapeutics]

The second one, the response is pretty easy. With the ongoing studies, especially the ALPHA3 study, which is what the study that you are referring to, yes, the clinical material for the ALPHA3 is coming from the CF1 manufactured cell.

[David Chang, President and CEO at Allogene Therapeutics]

Okay. Then maybe just curious on your thoughts around the... 'cause we saw recently a relapse case with an autologous CD19 CAR T program out of EULAR back in June. Just curious what your thoughts are on that data set, and does that have any impact on how you think about, you know, your dosing or lymphodepletion regimen for 3-9? Thanks for taking our questions.

[David Chang, President and CEO at Allogene Therapeutics]

Yeah, so that's sort of an added question. I think, you know, that is referring to the autologous CD19 CAR T, being studied in autoimmune indications. You know, the way we view is that, you know, still there is a lot going on with the signal finding and, you know, the proof concept data being generated. As that happens, you know, there will be some, you know, variability. I don't think, you know, the recent findings at, as reported at EULAR, it doesn't really change any assumptions around what the CAR T therapy can do in the autoimmune indications. You know, what we are seeing, you know, fundamentally is very different than all other treatment that has gone forward in the autoimmune indication.

[David Chang, President and CEO at Allogene Therapeutics]

You know, specifically, you know, potential of being able to provide long-term remission after a single infusion, that is very attractive. You know, the duration of long-term remission, I think that's what's coming into question, and what is, you know, the length of remission that would really, you know, make us to get excited about? I think that, you know, is something that we are following closely, but most of the patients who have been treated with the autologous CD19 CAR T, and also with some other, you know, BCMA CAR T, what we are seeing is that the durability of response is very good, lasting a year or longer, and sometimes ongoing response as the last data, you know, cuts.

[David Chang, President and CEO at Allogene Therapeutics]

So it really doesn't change any of the assumptions that we are making with our ALLO-329, which, as an allogeneic CAR T, provides a lot more benefit that will be important as we think about the autoimmune indications.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Michael Yee with Jefferies. Your line is open.

[Jenna Li, VP of Equity Research at Jefferies]

Hi, thanks for taking our questions. This is Jenny Li for Mike at Jefferies, and, congrats on getting the ALPHA3 trial started. Would you be able to comment on the pace of ramp-up for more sites, particularly thinking about, leveraging the old sites that you had for Alpha study and branching out to newer sites and balancing academic versus community and where the, less severe frontline patients may be based at? Thank you.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Hi, this is Zach. So, great question. And so the approach that we are taking is, I would say both similar and distinct from what we've taken in the later line studies that we've had ongoing for a few years at Allogene. As you rightly point out in your question, the target population that we are pursuing in ALPHA3, for the most part, are treated in the community. There are some patients who do get treated at large academic centers, either from the outset or through referral, but up to about 80% of patients with frontline or newly diagnosed LBCL are treated in the community. That fact alone has really guided our decision-making around site selection.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

And so, as we mentioned in the prepared remarks and is reflected on clinicaltrials.gov, the early wave of sites that have activated in this study have indeed been community centers, which are the common centers for frontline care. That said, the large academic referral centers are always going to have a role to play in clinical trial execution. And so as that list grows on clinicaltrials.gov, you'll see some familiar faces with partners that we have had for a long time. But I'll also say that we've expanded our reach into some academic centers that have not opened up studies before.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

So we are actually pretty excited about the breadth and the variation in the types of sites, both old and new, community and academic, as we're getting this study up and running.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Tyler Van Buren with TD Cowen. Your line is open.

[Tyler Van Buren, Managing Director and Senior Equity Research Analyst at TD Cowen]

Hey, guys, good evening. Congratulations on all the progress. So if enrollment for ALPHA3 is expected to complete during the first half of 2026, can you elaborate on what the interim EFS analysis during the first half of 2026 is expected to look like, and what its specific purpose is, and why you need it just ahead of the final EFS analysis by year-end?

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Hey, Tyler, Zach, thanks for the question. So, you know, as we mentioned, you know, we've modeled out, and we've discussed in this venue before, we've modeled out what the expected time to event is, EFS, in this case, for patients who are in the observation arm, and it's quite short. I mean, the prognosis of these patients with MRD positive disease at the end of our CHOP is poor, and the time to progression is measured in weeks to months. So that's given us the opportunity to perform this interim analysis. You know, we haven't gone into details around what the volume or the percentage of the data that we will be examining at that interim analysis is.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

But it will allow us to potentially initiate conversations with FDA. It will also allow us to get a sense of, you know, what the potential market penetration could be. So there are a lot of quite significant practical benefits to having an early formal look at that data that will certainly guide us in the direction of what we expect for the primary as well. So we'll be able to begin rolling in the first half of 2026. That's our vision.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Jack Allen with Baird. Your line is open.

[Jack Allen, Senior Research Analyst at Baird]

Great. Thanks so much for taking the questions, and congratulations on the progress made over the quarter. I just wanted to ask a couple here. The first of which is on the manufacturing process update. It sounds like all the product is now coming from Cell Forge 1. I just wanted to ask if you have any sense for any differences in potency as it relates to Cell Forge 1 manufactured products as compared to CMO products? Were there any changes in the process there, or is it still the Allo process that you're utilizing at both centers? And then really briefly on CLL, I was hoping you could provide some context as to what we should look for in early 2025. I would love to hear about the size and breadth of that data set that we should expect in early next year.

[David Chang, President and CEO at Allogene Therapeutics]

Hi, Jack. Thanks for the questions. Let me take the manufacturing questions, and I will defer the CLL question to Zach. In terms of, you know, manufacturing, you know, we have successfully, you know, manufactured all the products that we are currently investigating in the clinics at CF1. With respect to the details of how we are characterizing, you know, we have a very high standard of characterizing the, you know, the products. That includes the potency. You know, the way that we characterize the potency is, you know, looking at both, you know, what's required for the release of the product, as well as, other characterization that we use for the internal learning and, you know, for the improvement as we work on the processes.

[David Chang, President and CEO at Allogene Therapeutics]

You know, can't really go too much into that, but so far, the products that we are manufacturing at CF1 is meeting all the standard to take it into the clinics.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

And Jack, I can address your question on CLL. So, you know, we are obviously pouring most of our efforts and attention into the ALPHA3 program, and, you know, CLL continues to run alongside. And so as we look towards that data update in early 2025, again, I would say you set the expectations, you know, roughly around the same target number of patients with as much follow-up as we can generate.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line, Asthika Goonewardene with Truist. Your line is open.

[Asthika Goonewardene, Senior Biotechnology Equity Research Analyst at Truist Securities]

Hey, guys. Good evening, and thanks for taking my questions, and congrats again as well on the progress. On ALLO-329, the potential to reduce or eliminate lymphodepletion is obviously very attractive, but it might be also important to distinguish between those two words. So I'm curious to know, how many patients do you think you'll need to treat with ALLO-329 to actually figure that out? And do you think you might have an answer for that in 2025 on your first readout on this study?

[David Chang, President and CEO at Allogene Therapeutics]

Asthika, this is David. Let me take on that question. You know, what you are asking is a very important question, but I think it's too early to sort of, you know, lay out, you know, what, how we are thinking about the lymphodepletion. It will be, you know, one of the primary focus of our phase 1, you know, exploring the different lymphodepletion, as well as, looking at ways to reduce the, you know, the lymphodepletion that's currently being used in the autologous CD19 CAR T, trials in autoimmune. But, what we know from the 329, you know, with the dual CD19, CD70 approach, we do have, many different options that are available, in the study design to test, you know, this important question.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Sami Corwin with William Blair. Your line is open.

[Brooke Schuster, Biotech Equity Research Associate at William Blair]

Hi, thank you for taking our question. This is Brooke Schuster on for Sami. So regarding the community centers, given that these centers are less likely to be, like, less experienced or have no CAR T experience, are they getting extra training to be prepared for CAR T treatment, such as recognizing safety signals and ensuring proper MRD testing, et cetera?

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

... Hey, Brooke, this is Zach. Thank you for the question. So we approach every site kind of with the same view in mind, and that is, you know, we wanna make sure that they have all the tools and the information they need to safely manage their patients. So for the large academic centers that have been doing CAR for 10+ years, they would need potentially a little bit less training, although we still do offer that training than somebody who has somewhat less experience or maybe even no experience at all. We feel like we're in a pretty good place starting out because our safety profile for cema-cel, as we've shown in our phase I study, is actually fairly well tolerated with very little, in fact, no high-grade CRS or ICANS.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Sort of, an infection profile that is very consistent with patients who are receiving treatment for various different types of cancer. So, you know, from the perspective of training specific to management of CAR T side effects, you know, we're starting off with a leg up already. I will also add that, many, if not all of these, community centers are familiar with CRS and ICANS and other T-cell mediated, adverse events because they've been giving, bispecific therapy for LBCL and other cancers now for, you know, months or even years if they were open for trials. So these are not truly naive, centers. They stock tocilizumab in their pharmacies, et cetera.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

So we actually feel like this should be fairly manageable, but it's a good question, and we are making sure that each center is fully trained to handle this safely. You also asked about collection of the MRD test. So I'm proud to say that this is actually a fairly straightforward test that these sites will have to collect. In fact, it's very similar in terms of what they have to do on their side to just about any other test that is collected now for lung cancer, breast cancer. There's a piece of tumor that is sent in and then a blood test, and then Foresight handles the rest. So that should hopefully have very few errors or any difficulties.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Matthew Biegler with Oppenheimer. Your line is open.

[Matthew Biegler, Managing Director at Oppenheimer]

Hey, guys. Thanks for the question. It's great to be back. Wanted your opinion on the importance of T-cells in contributing to certain autoimmune diseases. It seems, you know, obviously like an industry where singularly focused on the B-cell reset, but I guess, you know, with some of the data mentioned at EULAR on relapses, I'm just curious. You know, it seems like your Dagger technology not only can maybe do away with lympho conditioning, but also target reactive T-cells. So just kind of curious, like, if you think you might have an edge on other players in the autoimmune space. Thanks.

[David Chang, President and CEO at Allogene Therapeutics]

Hey, Matthew, great to have you back. You know, a very important question as we think about the CAR Ts in autoimmune space. I mean, you know, I think we have to start design of the product, you know, thinking about this disease from the fundamental biologic perspective. You know, autoimmune disease is never a disease of B-cells. It's always the B-cells and contributing T-cells that really, you know, eventually manifest the symptoms of autoimmune diseases. So from that perspective, we felt being able to target activated T-cells, and we achieved that by going after CD70, which is expressed on the activated T-cells. We believe that this is very important to maximize the potential of ALLO-329 across different autoimmune indications.

[David Chang, President and CEO at Allogene Therapeutics]

So yes, we have to show it in the clinical data, but it definitely increases the potential of ALLO-329 versus, you know, CAR T programs that are simply targeting B cells.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of John Newman with Canaccord. Your line is open.

[John Newman, Managing Director and Senior Biotechnology Equity Research Analyst at Canaccord Genuity]

Hi, guys, congrats on the progress, and thanks for taking my question. So David, we've seen some data recently from two autologous CAR T programs in the autoimmune setting, which I'm sure everybody on the call is very familiar with. My question is, is there something different beyond the targeting of active T cells for ALLO-329? For example, manufacturing or another aspect that you think could result in more consistent results when you run the study? I think we're all trying to figure out exactly what the autologous data mean, but what I'm curious about is, is there something specific perhaps in the manufacturing process or somewhere else for 329, that could give more consistent results in the future? Thanks.

[David Chang, President and CEO at Allogene Therapeutics]

Hi, John. Thanks for that excellent question. I mean, you know, the manufacturing at the end, you know, is, you know, one of the, you know, big differences, you know, that can result in the, in a difference in the outcome. We don't have all the details of, you know, how different programs that have taken CD19 CAR T into the autoimmune space, you know, have been manufactured. But, definitely, you know, we do feel strongly believe that how the cells are prepared, you know, whether the cells are frozen before administration or administered without freezing, all these things together with, you know, the way that the cells are expanded, you know, makes a big difference. Unfortunately, the details are somewhat lacking because, the information are somewhat kept as a proprietary information, but I think that is a very important question.

[David Chang, President and CEO at Allogene Therapeutics]

As for the, you know, 329, you know, we have taken a different approach of manufacturing. You know, fundamentally, how we introduce the transgene that express CAR, whether we do lentivirus, we have, in this case, taken the path of doing site-specific integration using CRISPR-based nuclease and AAV. And, you know, studies have shown that kind of approach can potentially improve the consistency of the final product, which we believe is very important as we think about indications such as autoimmune. So, stay tuned.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Ben Burnett with Stifel. Your line is open.

[Benjamin Burnett, Managing Director in Equity Research at Stifel]

Hey, thank you very much. I also wanted to ask about ALLO-329 and autoimmune disease. There was a recent disclosure with a CD19 allogeneic CAR T from BRL Medicine. This was via an academic study in China, but we thought the data looked quite good. That BRL asset, though, it contained a number of edits and modifications. So I guess the question is, number one, it'd be great to get kind of your thoughts on those data. And just secondly, I guess, how does the technology that you're implementing and with ALLO-329, with Dagger, and everything else sort of compare to that BRL asset?

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Ben, this is Zach. Thanks, very insightful question, and thanks for bringing up that, exciting report. So we share, I think, the enthusiasm around that first report of, responses to a CD19 allogeneic CAR T, in three patients with, two different autoimmune indications. We feel that that is a very strong proof of concept that this platform, which we have demonstrated is, functional in oncology, is likely to also be operable in autoimmune disorders. You rightly highlight, some of the strategies that they have employed to, to ensure adequate, expansion and persistence. They have taken, what might be called a, a sort of a cloaking strategy, where they've eliminated, MHC molecules, and they've also, disrupted the PD-1 axis.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

This is a strategy that has been tried by others, and I think it's probably still too early to say whether that is, you know, globally speaking, on a successful path. Our plan, it has relied on the Dagger technology to ensure that we do get that adequate expansion and persistence, and we feel very comfortable that this sort of Dagger versus the cloaking strategy will deliver benefits. And we've seen this now in the RCC program with the ALLO-316 product, where we get up to two logs better expansion and improved persistence, even with the deintensified lymphodepletion regimen.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

So I think every allogeneic platform is going to have to deal with the idea of premature rejection, and we are very confident that the dagger is gonna give us a path forward there.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Luca Issi with RBC Capital. Your line is open.

[Luca Issi, Senior Biotechnology Analyst at RBC Capital]

Well, great, thanks so much for taking my question. Congrats on the progress. Maybe just a quick one, David or Zach. On, what's the latest thinking on whether you think that anti-CD52 is actually needed as part of the lymph depletion in ALPHA3? I was always under the impression that adding CD52 was actually important to discriminate between endogenous and exogenous T-cells, but it feels to me that you're maybe downplaying that a little bit recently, and maybe you're now thinking that anti-CD52 may not be needed as part of lymph depletion. One, am I right? And if so, how should we think about the overall profile of your drug in a scenario where anti-CD52 is needed versus not needed? Any thoughts there? Much appreciated. Thank you.

[David Chang, President and CEO at Allogene Therapeutics]

Yeah, Luca, let me take on that question. You know, we do believe anti-CD52 antibody is very important to create the persistence, as we have demonstrated in the relapsed/refractory, in a large B-cell lymphoma setting. When it comes to, the you know, the ALPHA3 study, where we are treating, you know, minimum residual disease, we are talking about a different clinical setting. These patients have minimal disease, which may not require, you know, the kind of persistence that is needed to treat large volume disease. That's why, you know, we feel that, you know, testing the lymphodepletion both with and without, the CD52 antibody or ALLO-647, that we are using, is an important scientific question.

[David Chang, President and CEO at Allogene Therapeutics]

And also, you know, by doing the study as we have designed ALPHA3, it gives us really an opportunity to carefully review and dissect the contribution of ALLO-647 for as a lymphodepletion in the MRD in a setting. So that's a question that is to be, you know, tested. And, you know, either case in ALPHA3 study, you know, we are counting on the outcome as measured by the EFS. And whether we proceed with FC or FCA doesn't really change, you know, what we are trying to do with ALPHA3 study.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Tony Butler with Roth Capital Partners. Your line is open.

[Tashdid Hasan, Biotechnology Equity Research at ROTH Capital Partners]

Hi, this is Tash Hassan on for Tony. David and Zach, you briefly touched upon this, the MRD testing for patients, and, you know, I'm assuming that this is done very soon after the patient is done with the sixth cycle of chemotherapy. Now, I wonder if you could flesh this out a little bit. For example, you know, given that, you know, sometimes the disease comes back rather quickly for MRD positive patients, how long it takes for patients to get the results? And, additionally, whether the test is something easy, or does the patient need to go to a specialized facility to be tested? Thank you.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Hi there, this is Zach. So, you're absolutely spot on. This is a race against time to make sure that we can get the dose of cema-cel in while the patients are still in remission. And in fact, we think that that speed is actually what makes an allo CAR T product best suited for this type of a trial. As to the specifics, so first, the patients will get their MRD tests at the centers where the study will be open. So there's no need to go to a specialized place to get the blood drawn. All of that will be collected just as any other clinical trial biospecimen is collected every day in other trials, and that is then sent in to Foresight, who runs the test.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

That test is, we will have that result back within 1 to 2 weeks, hopefully closer to 1 week in most of these patients, but very, very quickly. The test itself is drawn more or less when the patients come in and get their first follow-up scan after their sixth cycle of R-CHOP. So this is a standard of care scan, taken between 3 and, say, 6 weeks or so after that last dose of chemo. If the patient's in remission, that makes them potentially eligible for ALPHA3. They have their MRD test drawn, they get the result back in 1 week to 2 weeks, and if they're MRD positive, that patient would then potentially be eligible to come into the trial.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

So it all happens very, very quickly, and the likelihood of a patient relapsing in that interval is non-zero, but it's actually quite low, because most of those relapses do occur, say, you know, at the time of the next scan, which may be 2-3 months later. So we're hoping to get all this work done, while the patients are still in remission, so we can effectively deliver the consolidation dose of cema-cel.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Reni Benjamin with Citizens JMP. Your line is open.

[Reni Benjamin, Managing Director at Citizens JMP]

Hey, good afternoon, guys. Thanks for taking the question, and congrats on all the progress. Just regarding ALLO-329, could you give us a sense as to when we might see some preclinical data, and what we should be kind of focusing on? Because, you know, correct me if I'm wrong, persistence doesn't seem to be, you know, kind of the more important factors to focus on as compared to, you know, depth of depletion, but you know, any feedback would be great on that. And I guess just as a follow-up, just given there's some work with BCMA-targeting agents in autoimmune as well, is there a chance that ALLO-715 might see a revival? Thanks.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Hey, Reni, this is Zach here. So the first question on the preclinical data, we are hoping to share that soon. And, you know, we're there. There are related data from a somewhat related product that we shared last year at SITC. So, for those of you who can't wait for the update with the 329 product, you can get a little bit of a preview from the data we shared last year. That is using the old gene editing platform, so we've made a few updates, but that will be a good appetizer for you as we are preparing that preclinical data for later this year.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

As far as the question around persistence, you know, obviously that's very hard to measure outside of a clinical trial. But I would agree with the premise of the question that, you know, our belief, which is built on the data that's been shared from the autologous field, as well as that paper that was alluded to previously in the allo CAR T, is that it's likely that the persistence is going to have to be shorter here or could be shorter than it needs to be in oncology, which we think bodes well for allogeneic products like ALLO-329. Finally, your question around BCMA and ALLO-715. We currently do not have any plans to put ALLO-715 into the clinic for treatment of autoimmune disease.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

But of course, we'll be watching that field very carefully in the coming months and years.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of Biren Amin with Piper Sandler. Your line is open.

[Biren Amin, Managing Director and Senior Research Analyst at Piper Sandler]

Yeah. Hi, guys. Thanks for taking my questions. Maybe to start on the CLL program, I noticed a slight push out on data from year-end this year to early next year. Are we still, I guess, expecting 12 patients worth of data? And should the comp be, you know, the Breyanzi 20% CRR? Is that, I guess, what we should be looking toward it when we receive the data?

[David Chang, President and CEO at Allogene Therapeutics]

... Hi, Biren. Let me take on the, you know, first question. You know, with your eagle eyes, I guess, you noticed that we have pushed out the timeline a little bit. That really comes from the fact that in the current environment, we have the need to prioritize and focus on the ALPHA3 study. That is our primary interest, enrolling into the study and monitoring how that study advances. So, you know, it's really a reflection of, you know, reallocation of internal resource to, you know, support the ALPHA3 study, you know, which so far is, you know, progressing extremely well. And for that reason, you know, we do not wanna burden the team by, you know, asking, you know, them to also accelerate the CLL study.

[David Chang, President and CEO at Allogene Therapeutics]

You know, our target for the Phase 1 study, you know, for the CLL has not changed. It's essentially targeting approximately 12 patients enrollment. And the bar that we are aiming for is, as we have previously communicated, is set by what we have seen, you know, with the Breyanzi in the relapsed refractory CLL patients.

[Operator]

Thank you. Please stand by for our next question. Our next question comes from the line of William Pickering with Bernstein. Your line is open.

[William Pickering, Senior Analyst at Bernstein]

Hi, good afternoon. Thank you for taking my question. Congrats on all the progress, especially the activation of the community sites in ALPHA3. What are some of the attributes of community sites that seem to be making them more or less interested in participating in this study? Is it about infrastructure, prior clinician experience with CAR T, or some other factor? Just trying to get a sense for how to sub-segment this community setting, given that it represents such a large percentage of patients. Thank you.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

Hey, William, this is Zach. So, excellent question. And, you know, let's sort of help you parse that out. So I think, first and foremost, the signal that we're hearing loudest and clearest from our community partners is that they are really excited to be able to offer CAR T to their patient population. And as I said, most of these community centers don't currently do that. They have to refer their patients out when they relapse. So as I, as I mentioned before, you know, you, you have to have a clinical relapse in order to be eligible for, for all approved CAR T. And if those community centers do not offer CAR T, that means that those patients have to be referred out. And, oftentimes, those patients don't want to be referred.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

They, they will accept a non-CAR T option for salvage therapy, if that allows them to stay with the doctor that they've come to trust and in the center that is close to their home. As to why these community centers have not begun to offer autologous programs, the reasons there are varied, but, to one degree or another, they all come down to the investment that would be required by these centers to build out the infrastructure in terms of, specialized team members, apheresis capacity, and potentially even inpatient management facilities to actually offer these products safely, to patients.

[Zachary Roberts, EVP of Research and Development and Chief Medical Officer at Allogene Therapeutics]

So you know, we really believe that we have threaded this needle here and are offering an off-the-shelf option to patients who are in need, and who likely could derive a significant benefit while all being able to be done at the centers where they are most comfortable and they get to stick with their doctor.

[Operator]

Thank you. Ladies and gentlemen, I'm showing no further questions in the queue. I would now like to turn the call back over to management for closing remarks.

[David Chang, President and CEO at Allogene Therapeutics]

Yeah, I'd like to thank you, all of you on the call, for your interest and continued support as we progress on our industry-leading programs. Last quarter and going forward, it will be all about the momentum. You know, we are more energized than ever with the path forward and the building momentum that we believe will lead to sustained growth. So operator, thank you, and you may now disconnect.

[Operator]

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

Participants

Executives

• Christine Cassiano, Executive Vice President
• David Chang, President and CEO
• Geoffrey Parker, CFO
• Zachary Roberts, EVP of Research and Development and Chief Medical Officer

Analysts

• Asthika Goonewardene, Senior Biotechnology Equity Research Analyst at Truist Securities
• Benjamin Burnett, Managing Director in Equity Research at Stifel
• Biren Amin, Managing Director and Senior Research Analyst at Piper Sandler
• Brooke Schuster, Biotech Equity Research Associate at William Blair
• Jack Allen, Senior Research Analyst at Baird
• Jenna Li, VP of Equity Research at Jefferies
• John Newman, Managing Director and Senior Biotechnology Equity Research Analyst at Canaccord Genuity
• Luca Issi, Senior Biotechnology Analyst at RBC Capital
• Lydia Finnegan, Research Analyst at Goldman Sachs
• Matthew Biegler, Managing Director at Oppenheimer
• Reni Benjamin, Managing Director at Citizens JMP
• Tashdid Hasan, Biotechnology Equity Research at ROTH Capital Partners
• Tyler Van Buren, Managing Director and Senior Equity Research Analyst at TD Cowen
• William Pickering, Senior Analyst at Bernstein