Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)  

ImmunoGen, Inc. (NASDAQ:IMGN)

F2Q13 Earnings Call

January 25, 2013 8:00 a.m. ET

Executives

Carol Hausner – Executive Director, IR and Corporate Communications

Daniel Junius – President and CEO

Gregory Perry – EVP and CFO

Charles Morris – Chief Development Officer

Analysts

Simos Simeonidis – Cowen and Company

Ryan Martins - Lazard Capital Markets

Ling Wang - Summer Street Research Partners

Joel Sendek - Stifel Nicolaus

Marshall Urist - Morgan Stanley

Matthew Harrison - UBS

Adnan Butt - RBC Capital Markets

Karen Jay - JPMorgan

David Miller - Biotech Stock Research

Jason Kantor - Credit Suisse

Thomas Wei – Jefferies & Company

Yale Jen - Roth Capital Partners

Operator

Good day, and welcome everyone to the ImmunoGen’s Second Quarter Fiscal Year 2013 Financial Results Conference Call. Today’s call is being recorded. At this time for opening remarks and introductions, I would like to turn the call over to the Executive Director, Investor Relations and Corporate Communications, Carol Hausner. Please go ahead.

Carol Hausner

Good morning. At 6.30 this morning, we issued a press release that summarizes our financial results for the second quarter ended December 31, 2012, the second quarter of our fiscal year. I hope you’ve all had a chance to read it, if not it’s available on our website.

During today’s call we will make forward-looking statements. Our actual results may differ materially from such statements and descriptions of the risks and uncertainties associated with an investment in ImmunoGen are included in our SEC filings, which also can be accessed through our website.

In our call today, our Chief Executive Officer, Dan Junius, will provide an update on ImmunoGen, and our Chief Financial Officer, Greg Perry, will discuss our financial results and guidance. We will then open the call to questions. Our chief development officer Dr. Charlie Morris is here with us for the Q&A session of the call. Dan?

Daniel Junius

Thank you, Carol, and good morning everyone. We look for 2013 to be a very important year for ImmunoGen. Certainly for TDM-1 there are number of significant events anticipated that would start with the approval and the launch in the U.S. sometime around or hopefully before the February 26 PDUFA date. We also look to see approval in Europe and launches to begin there over the course of this year as well as the continued advancement of their clinical programs across a range of indications and expansion into some additional areas that they’ve announced in terms of for early breast cancer.

At the same time we are looking for Merck to progress across our wholly owned pipeline. Over the course of the year we plan to have clinical findings in each of our three lead TAP compounds and we’re also preparing to advance the fourth IMGN289 to IND and into the clinic later this year. While we expect T-DM1 to provide a significant revenue stream to ImmunoGen we believe our own programs offer the greatest long term value for shareholders and therefore my commentary will focus on our wholly owned programs.

Before I get to that, though, I would like to comment on our organization events since our last call. As noted earlier, our proprietary programs are expected to generate important data over the course of this year. With this in mind, we established a new position of chief development officer to expand ImmunoGen’s skill set and knowledge base and to provide leadership to our expanding development activities. We’re very pleased to have Dr. Charlie Morris now with us in this role.

Charlie who over his career has been in senior medical research and development roles for Allos, Cephalon, AstraZeneca strengthens our existing capabilities toward understanding and experience in late stage development and registration strategy. We look forward to Charlie’s contributions in this new position.

So let me now turn to our wholly owned compounds and I will start with IMGN901 which is for CD56+ cancers. This would include a number of cancers including small cell lung cancer and the majority of multiple myeloma cases, Merkel cell carcinoma, neuroendocrine tumors, other hematologic diseases for CD56 is broadly expressed in a wide range of indications. Currently it’s in phase 2 testing for first line treatment of small cell lung cancer in our NORTH trial and I’d like to update you on that study.

Patient enrolment is underway at about 40 centers in the U.S., Canada, UK and Spain. I am pleased to report that we are very close to completing enrolment of the first 59 patients. These patients will represent the first stage in what is (inaudible) two stage design and we will follow up with this group as a cohort with the end point of PFS of six months. We expect to have this data in the back half of 2013. This will allow us time to complete enrolment of these patients, then follow them for six months and clean up and lock the database. We will report whether the trial met our predefined hurdle for the first 59 patients and that data and the end point will enable us to make certain development decisions particularly in the area of CMC but also it will enable us to seek further KOL input and begin discussions with regulatory agencies. Our intention is to report the data at a medical conference.

While we are looking at the first 59 patients, we will continue to enroll the 420 patients in the study and we’d expect to complete that enrolment over the course of 2013. If that’s accomplished (ph) we would then look to present the results from the full trial in 2014 and we (inaudible) targeting ASCO. While we are making progress in our small cell study we recently reported data in an oral presentation at ASH on multiple myeloma studies that we have undertaken. This is a phase 1 trial assessing IMGN901 used in combination with Revlimid and dexamethasone in patients with CD56 positive disease who are relapse or relapse refractory to earlier therapies.

We were encouraged to see activity in patients previously treated with Revlimid including in Revlimid refractory patients with a good tolerability profile. While we don’t plan to pursue this indication at this time the data generated will be important as we evaluate long term development options for IMGN901.

Let me now go to IMGN853, this is a TAP compound for cancers that overexpress the folate receptor 1 and this would predominantly be ovarian and non-small cell lung cancers. Here we’re making good progress as well. We have a protocol that allows us to have single patient cohorts at lower dose levels. This has enabled us to move through these lower dose levels quickly and we’re now in a position to be assessing the compound at higher dose levels. We are planning to submit an abstract at ASCO where we would report our first clinical data on this compound.

Our last clinical compound is IMGN529. This targets CD37 which is found on B-cell malignancies. So at this point in time it’s in phase 1 testing for non-Hodgkin's lymphoma. With CD37 as a target chronic lympho-blastic leukaemia is also a potential opportunity. We believe that the strong rationale for 529 in that it’s highly differentiated from other agents in the clinic for NHL including other ADC. This is because we have an antibody here that’s been selected for its pronounced anti-cancer activity in preclinical tests and two, that we have added our ADC technology using DM-1 as a cyto-toxin for IMGN529.

Enrollment progress in this trial has been a little bit slower in part due to the need to start at lower dose levels. However we still plan to report our first data in 2013 most likely at ASH.

Lastly, let me mention IMGN529, this is a TAP compound we’ve developed for cancers of overexpressed EGFR. That one includes squamous head and neck cancer and non-small cell lung cancer. For IMGN529 the antibody – an antibody that we’ve developed ourselves and we’ve added to that again the DM1 as the cyto toxin. Within the (inaudible) the antibody itself has anti-cancer activity that provides the capability for EGFR inhibition. By bringing DM1 into the picture we’ve now provided the second mechanism for cell killing. This contrasts with current compounds that target EGFR whose sole mechanism of action is EGFR inhibition and therefore they don’t address the issue of potential resistance.

The time (inaudible) we’re taking into preclinical testing for IMGN289 has greater potency than naked EGFR binding antibodies and it has activity against tumors that are resistance to EGFR inhibition. At the same time we’ve been able to select an antibody that has shown pre-clinically their tolerability similar to T-DM1 in that we found an antibody that doesn’t manifest the skin toxicity seen with the agents such as Erbitux. Our plan is report clinical data at AACR in April on 289. And then we have a development plan to submit the IND in mid-year that would allow us to begin patient dosing later in 2013.

With that, let me turn it over to Greg to talk you through the financials for the quarter.

Gregory Perry

Thanks Dan. Let me walk you through the press release. Our net loss for the second quarter of fiscal year 2013 was $24.4 million or $0.29 per share and that compares to net loss of $12.8 million or $0.17 per share for the same quarter last year. Revenues for our second quarter were $2.6 million as compared to $7.6 million for the same quarter last year. And license and milestone fees overall were $400,000 in the current quarter compared to $6 million last year. The previous period includes $5 million in milestone payments earned with three product achievements (ph) by our partners that were not repeated in the current quarter.

Revenues for the second quarter of fiscal ’13 also include $2 million from research and development support fees compared to $900,000 last year and $100,000 in clinical material reimbursement compared to $600,000 in the same quarter last year. Revenue can vary significantly by quarter depending on the work we’re doing to support our partner programs as well as the timing and progress partners are making with their programs.

Our operating expenses for the second quarter of this fiscal year were $27.1 million compared to $20.4 million for the same quarter last year. The current quarter expenses include $21.7 million of R&D expense compared to $15.6 million last year. The increase is primarily due to greater investment to advance our wholly owned product candidates and that includes increased third-party costs to produce antibody for use in clinical materials, increased clinical trial costs and increased personnel expenses.

Our second quarter expenses also include general and administrative expenses totaling $5.5 million and that compares to $4.8 million in the same quarter last year. And this increase primarily reflects increased patient costs and recruitment costs. Cash used in operations for the first half of our 2013 year was $42.7 million compared to $24 million for the same period last year. Reflecting increased cash used to fund our net loss our capital expenditures were $2 million.

Our guidance for our full 2013 fiscal year is unchanged from our last quarterly call. We project that our net loss for our fiscal year ending June 30, 2013 will be between $70 million and $74 million and net cash used in operations will be between $78 million and $82 million. In capital expenditures we expect to be between $4 million and $5 million.

As you will note we are guiding to a full year net loss that is below what you would estimate by just extrapolating our first half net loss, and that’s primarily because we are expecting significantly higher revenues in the second half of fiscal ’13 primarily from the expected $10.5 million milestone due with the T-DM1 approval in the U.S. as well as other partner related events that trigger either recognition of deferred revenue or a milestone. While there's always a risk with predicting the timing of partner related events, at this time we feel comfortable leaving our guidance as it is.

As a reminder, these projections don’t include the $5 milestone we earn with T-DM1 approval in Europe as we are projecting this to occur after the end of our fiscal year in June but we also haven’t included T-DM1 royalties in these projections as we expect these will be reported one quarter in arrears and to be at earlier stage when our fiscal year ends in June. Of note, we believe our current cash position combined with the expected revenues from T-DM1 will be sufficient to advance our three compounds 901, 853 and 529 to proof of concept. And we believe demonstration of proof of concept with the wholly owned ImmunoGen product candidate will be an important value inflection point for the company. Dan?

Daniel Junius

Thank you, Greg. Let me just summarize what we expect to see taking place for the various compounds over the course of 2013. We would expect with IMGN853 to have the first clinical data reported in the second quarter of this year, with IMGN901, we would expect the first phase 2 read-out to occur sometime in the second half and for IMGN529 we look to have the first clinical data in the fourth quarter of this year. For 289, the preclinical data should be available at AACR which will be in April and then the IND would become active sometime just after the middle of this year.

Looking at partner compounds, starting with T-DM1 for metastatic HER2 positive breast cancer patients who had previously been treated with Herceptin we would look for U.S. approval early this year and then EU approval sometime in the back half of 2013. For early HER2 positive breast cancer there are three registration trials that are scheduled to start over the course of 2013, some of them in the earlier part of 2013 and we would expect to see enrolment continue in second line HER2 positive gastric cancer study that was initiated last year.

I should also remind you that we have seven other partner compounds in the clinic, two of those have reported data thus far. We would look to see further information on those two compounds as well as see the first data on the other five compounds that our partners are advancing in the clinic and we would look to see one partner compound moving to pivotal testing in 2013. So that’s our picture as we come out of our December quarter.

Let me turn it over to Carol. We’d be happy to respond to your questions.

Carol Hausner

Great. Thanks Dan. We are about to open the call to questions. We ask that please be limited to one to two questions per person and so each analyst has had an opportunity to ask questions. Operator we are now ready to open the line.

Question-and-Answer Session

Operator

(Operator Instructions) And we would take our first question from Simos Simeonidis with Cowen and Company.

Simos Simeonidis – Cowen and Company

Good morning. Thank you for taking the questions. The first question has to do with the proposed label in the U.S. Can you give us any color based on your discussions with Roche and their discussions with FDA. What's your expectation for label, will you be able to treat patients that are essentially first line in addition to second line?

Daniel Junius

Look, our read is really based on the design of the study and the request, the submission by Roche as opposed to any further discussions with them and given that the study included patients who had received, who had disease that advanced on Herceptin in the adjuvant setting and therefore were first line metastatic patients and there was about 15% of the patients in the study that represented that particular profile, it would seem logical that, that would be in the label. But I think we have to see how the process goes between Roche and the FDA and ultimately what they determine.

Simos Simeonidis - Cowen and Company

And my second question is on the commercial front, do you have an idea how quickly post approval they can launch, meaning, the next day, a few weeks after and in terms of the sales force they would be using – I assume it’s going to be same sales force that’s detailing, they have the products including Herceptin, Xeloda, Perjeta, do you have any color on that?

Daniel Junius

No color from a commercial standpoint, my assumption would be the same as yours. So we do have some insight into their preparedness on the CMC side, they had – I can’t imagine that there would be any obstacles there.

Simos Simeonidis - Cowen and Company

So you would assume that they would be able to go right away?

Daniel Junius

That would certainly be my expectation, absolutely.

Operator

And we’ll take our next question from Ryan Martins with Lazard Capital Markets.

Ryan Martins - Lazard Capital Markets

Firstly, on 901, Dan, can you remind us again that ASH now is looking at the PFS at six months and make CMC decisions off that and what kind of detail we may have for the final data from the stage two of that trial?

Charles Morris

Hi Ryan, this is Charlie. Yeah, the study has been designed based on historical data which in some of the largest studies shows a medium PFS around 5.5 months. So we've got a pretty good handle on what we think the PFS should be in this type of population, and I think as a result of that, that gives us the ability to really be able to put the data in light of what is known from the historic data, whilst also having the control arm in there to make sure that we are consistent with those data. And I think any study which comes in the Phase 3 setting is almost – we’re going to have overall survival and time to events end point. So I think basing this off time to events end point makes a lot of sense at this particular stage. I'm sorry -- could you remind me what the second part of the question was?

Ryan Martins - Lazard Capital Markets

Oh, I was just – what kind of – I guess the implications that data will have for your final readout from the stage two.

Charles Morris

And depending on what the data looked like, the first point obviously that may be an inflection point upon which to base some important decisions in terms of CMC and the regulatory consultation as well as in case any legacy feedback. Then obviously by this time we would be in a position to finalize the design and start the phase 3, we would have the final data from a larger group of patients to further inform the study design and really to check the assumptions that we put together May 1.

Ryan Martins - Lazard Capital Markets

Okay, and maybe on 289, I know I think Dan mentioned that you have some activity against the EGFR resistant tumors and have you seen especially the activity against the T70 (inaudible) patient and should we see some of this data at the AACR?

Daniel Junius

I don't know that we have -- well first off, we don't want to get ahead of data that we would have at AACR, Ryan. So why don't we hold off on that. We'll have several posters dealing with safety, dealing with activity. And so I think we would want to wait until we have that data at AACR.

Operator

And we’ll take our next question from Ling Wang from Summer Street Research Partners.

Ling Wang - Summer Street Research Partners

So for IMGN853, can you give us more details about how many patients have been dosed and what are the doses it has been up to?

Charles Morris

It’s Charlie again. I don’t think it’s certainly going to be helpful to get into the site details, number of patients at this point. I think it’s enough to say that we are pleased with the progress of the trial. We’ve been recruiting to the type of the schedule that we were hopeful for from the beginning and therefore remain highly optimistic that we will be able to provide some update to clinical information conferences during this year.

Ling Wang - Summer Street Research Partners

So by ASCO, should we see the therapeutic dose for – I mean do you expect we could see data from the therapeutic dose of this compound?

Charles Morris

I would be hopeful that, that is the case but obviously, as the conference comes around we shall know more but we would be optimistic that, that would be the case.

Operator

We’ll go next to Joel Sendek from Stifel Nicolaus.

Joel Sendek - Stifel Nicolaus

So on 901 first, you mentioned the 5.5 months. I'm wondering what kind of a delta over that you would need to see in order to be encouraged by that. And then on 289, I'm wondering if you can give more background as to why you're not, or maybe you might consider moving the antibody forward.

Daniel Junius

What was the rest of that on 289, Joel?

Joel Sendek - Stifel Nicolaus

Yeah, I am just wondering what – it seems like you have seen activity as negative antibody, maybe that might be worthwhile looking into, as well as the complicated version, I am wondering what their thought process –

Daniel Junius

In terms of 901, we haven’t disclosed thresholds there. We did as we developed the study design there was a dialogue with KOL to determine what would be an appropriate hurdle to be interesting because you’ve heard Charlie go through some of the discussion around what we were looking for end points, first end point or the interim I should say, with PFS as six months will allow us to make some incremental financial decisions on top of what we’ve already been doing to have material available for later stage days. But the actual – we haven’t disclosed the details of what is – what the specific threshold there is but we are looking for a meaningful increments for durability, not for response rates because I think as you know patients do respond well to existing first line therapy.

As it relates to 289, maybe there is little bit of an open question we may consider that, I think that we are most interested at this point in taking the conjugate forward and there may be avenues to pursue it beyond some of the indications that we were already looking at, given the activity of the antibody as a naked agent. But right now our focus is on advancing the ABC.

Operator

And we’ll go next to Marshall Urist with Morgan Stanley.

Marshall Urist - Morgan Stanley

So two from me, first just on 901, can you just give us a little bit more detail on the disclosure plans for that interim analysis? Are you going to tell us what the six-month PFS rate was or just kind of talk about it met our hurdle and we're going on to the whole study, so just a little bit more detail there would be helpful. And then just if you could remind us in small cell historically, what's your view of the correlation between PFS and OS benefits from historical trials, particularly for targeted agents versus chemo?

And then just to follow-up on one question on the folate program. Would you expect to have a significant number of kind of lung and ovarian patient in the early dose escalation to give us a sense of activity in those kind of key two indications?

Charles Morris

It’s Charlie again. 901 is just about the interim point, I think the disclosure will simply be whether or not we met our pre-defined hurdles. Obviously our level of optimism based on the exact numbers will depend on the basis we see them but the intended disclosure will just be cross the hurdle.

In terms of PFS, it’s always a difficult conversation, I think though that – we do know that there are a few drugs which had been shown to significantly impact overall survival in the second and first line in small cell lung cancer. So I think the drug can have a significant impact on progression free survival particularly given that we have some things a very specifically targeted CD56 as you know extensively expressed in small cell lung cancer and we’re following on from what the preclinical data had shown, I think that combined with a positive outcome from the phase 2 study would greatly encourage us to be going forward.

I think the final thing is that in terms of the folate study, as of the 853 study we are certainly hopeful to include a number of patients with the lung and ovarian both through the – based on dose escalation and then also into the dose expansion where we will calibrate the patients, with what we have – non-small cell lung cancer and two cohorts they are carrying cancers, obviously those clinical data, we will be able to see that mix of patients when we provide those data during this year.

Daniel Junius

Marshall, the one comment I would add beyond the disclosure that Charlie referenced we would expect that we would have the data itself for the interim patient population at a medical conference following our – once when the data is available, it’s just not clear what that timetable would be. So the disclosure would sort of come in two steps.

Operator

We’ll go next to Matthew Harrison from UBS.

Matthew Harrison - UBS

Two questions. So first just on guidance, just so I understand because we’ve seen or we have a better idea of the run rate now on expenses. I mean do those run rates make sense and so we should imply the kind of revenue that you're thinking about to get to your net loss guidance, or should we expect to see R&D go up or go down for the rest of your fiscal year?

And then the second is on 901. Just I guess the question is why won't you disclose what the hurdle is that you're looking for and then maybe as a follow-up to that, can you talk about what if you hit that hurdle, you said there will be some open questions that you'll be able to better think about in terms of how to design a larger study, so maybe if you could just let us know sort of what those open questions are.

Gregory Perry

Thanks, Matthew. First, on the guidance, yeah, I think on the expense side, we're continuing to invest in preparedness for pivotal materials in 901 and 853. So I'd expect that back half expenses to be higher as those plans continue to progress, as well as clinical trial associated costs and we are adding personnel to support our partners which are then built out in terms of revenue as well as to support our advancing programs in clinical pipelines. So I'd expect back half expenses to be somewhat higher than front end. And then I think the revenue then solves the equation for you.

Daniel Junius

It’s Dan, Matthew, on the hurdle question, the hurdle – the way the study is designed, the study because as the (inaudible) two stage therapies is utility study. Really the interim is intended to directly tell us whether we should continue to study or not. Now we’re going to continue to on the patients, so we are not going to do – sort of utilize that particular dimension and the hurdle is really set up for the data from the full study. So we would be looking off of the 420 to – at the threshold that’s there, it would be – obviously we will be looking at what we see off of the 59 patients and extrapolating into what that would project for the 420, and we just think that because once you see – once we have the full data set obviously there will be a hurdle – we will be looking at not just the PFS but at OS and number of dimensions, that it does get to be – that’s somewhat judgemental looking at the data in aggregate as opposed to telling us whether there is a single data point off of the full data set. But with the interim we will have the decision to make, that will involve incremental spending and we will make that decision one way or another and then have the data to disclose as decided at a medical conference.

Operator

We’ll go next to Adnan Butt from RBC Capital Markets.

Adnan Butt - RBC Capital Markets

So first, a bigger picture question. What's the difference between DM4 and DM1 and how do you select which one to prepare the antibody with? And then secondly, for 853 specifically, do you expect to show activity maybe middle of the year at ASCO or something? How long will patients be dosed for and what would next steps be for (inaudible)

Daniel Junius

Let me maybe deal with the first one and then Charlie may want to comment on again on 853, although I may have to ask you to repeat the question. It didn't come through that well. DM1 and DM4 I think as you know both tubulin inhibitors, the cyto toxin itself is, they both are comparable in terms of potency. They can be used with different linkers and in some ways the combination of cyto-toxin and linkers is somewhat more defining than differences in the inherent molecule DM1 versus DM4 itself.

In certain configurations we can make DM1 into a cleavable cyto toxin in terms of how it's released within the cell and then with the attributes that it would have subsequently in other cases we can have it be non- cleavable. So they do, we find in looking at them pre-clinically and even in the clinic there are somewhat different profiles that we see, DM4 is in the clinic with sanofi with SAR3419, so they do manifest in somewhat different ways but inherently they both convey the same property as an anti-mitotic and have comparable potencies. It's again which can be used with which linker and what you end up with the end result there. So maybe you could repeat the 853 question, Adnan.

Adnan Butt - RBC Capital Markets

Sure, firstly what’s the token for 853 and secondly, do you think there might be activity data at ASCO perhaps and how long they should have had the treatment – will the different patients subtypes ovarian or non-small cell lung cancer –

Daniel Junius

With 853, this is Dan again – we’re getting back to your question, that actually is the DM4 but maybe it links into the response I had, here we have a new linker, this is the first time we have taken this linker into the clinic, we refer to as SPDB DM4 but PDBS for linker. And as we’ve talked in other forums that particular linker has properties that allows the metabolite, the cyto toxin with elements of the linker that remain attached to counter multi-drug resistance, to influx mechanism specifically. So here you do have an example we’ve used, a different cyto toxin DM4 happens to marry well with the SPDB DM4, selfless PD configuration.

Charles Morris

The second part of the question, I apologize it didn’t come through totally clear again, but --

Adnan Butt - RBC Capital Markets

No not at all. Do you think 853 you might be able to see some signs of activity at ASCO?

Charles Morris

Certainly our hope would be that would be a possibility, yes. As I've said to the previous question, we are encouraged by the rate of recruitment into the study. We believe that we're getting close to what should be at the therapeutic range and we are obviously trying to encourage the patients most likely to have an opportunity to respond to the treatment to enter into the study. Obviously the duration of exposure will be dependent upon activity and the patient and the disease characteristics themselves but clearly, the intention is to provide clinical data, meaningful clinical data when we first disclose that information.

Operator

Then we will go next to Karen Jay with JPMorgan.

Karen Jay - JPMorgan

Good morning, this is KJ in for Cory Kasimov. Thanks for taking my questions. I just have a couple on the NORTH trial. First, could you remind us when enrollment began, maybe specifically first patient in, and then also are you assessing CD56 expression in the patients as they're coming in and if so maybe any comments you could make on how the expression compares to what you've seen historically in your published.

Daniel Junius

The study began just under a year ago, so first patient in was March of last year. And expression -- we are not screening patients for CD56 expression because it's relatively homogeneous in small cell lung cancer patients and virtually all patients express, KJ. So we are capturing the data but we're not screening for it to see if there's anything that's useful as we look at the data against the clinical results that we get from the study.

Operator

And we’ll go to David Miller from Biotech Stock Research.

David Miller - Biotech Stock Research

First question is on 289. Is the lack of skin response that you're seeing, do you think that's due to the binding site, binding strength perhaps or maybe something else?

Charles Morris

At the risk of repeating previous answers I think we’d like to really get into the detail of that with the disclosures at the time of the AACR. Obviously, there's going to be a lot of information and number of posters on this particular molecule which we're very excited about, including some of the discussion about why we believe there are differences in the (inaudible) site responses in these models.

David Miller - Biotech Stock Research

So I need to – I am trying to understand kind of the NORTH data process, let me see if I have this right. So in the second half of this year you’re going to tell us whether your met the hurdle for the interim analysis, that we won’t get any data. And then at a medical conference we will see if is there going to be – are we going to wait for the medical conference to see data from the interim or are we going to wait all the way until you have data from the full trial before we actually see data on what happened in NORTH?

Charles Morris

So the essence of the first analysis as Dan said is a utility, you’re quite correct, if we do not cross a predefined threshold consistent with the final two stage design the study will close. Assuming that we continue yet we would intend to bring to a medical conference those interim data assuming that by that point we would also expect that the full study would have recruited by about more than at that time as well. So this should be two pieces of the data following on relatively quickly at the presentation that ASH follow along to each other relatively quickly. But we would hope about the full detail of the interim analysis from medical conference.

Daniel Junius

I think we come subject to what the schedule of medical conferences would be relative to when the data would be available. I mean we would have the data and that would be an appropriate medical conference to report the interim data we would look to do that. But we just don’t know , because that would be when it’s going to be available, what the schedule of medical conferences is, what the cut offs would be for submission et cetera. So it’s difficult to give you much more clarity.

Operator

And we’ll go next to Jason Kantor from Credit Suisse.

Jason Kantor - Credit Suisse

Thanks. Most of my questions have been asked but just given the focus here on this interim stage 1 of the NORTH trial, I'm just curious, what is the financial commitments that you're holding off triggering until this event? And how much money are we talking about in terms of investment in the program that you're holding off?

Gregory Perry

Hey Jason, it’s Greg. It’s primarily related to scale up of – on the antibody side and so as well as some of the other pivotal aspects of the program. So I think we are in that kind of $5 million to $10 million range in that ballpark.

Daniel Junius

And just to be clear, there was the opportunity for a smaller investment to begin some of the development work. So we haven’t been entirely waiting until we see that we were able to make some investments to lay the ground work but the next incremental is what we are holding off until we have some additional data.

Operator

And we will go next to Thomas Wei from Jefferies.

Thomas Wei – Jefferies & Company

I wanted to ask on 901. Just a reminder of what the median overall survival is for a small cell lung cancer patient population and at the time of that interim, do you think that there's going to be interpretable data on overall survival?

Charles Morris

I think a median survival is generally reported as being in the 9 to 11 month range. The point where we'll be looking, we'll be looking at PFS at six-month – the six month PFS rate and so I don't think there will be interpretable overall survival events at that particular point. By the end of the study yes, then it may be somewhat indicative but I think the number of events overall is likely to be low prior to going into phase three.

Thomas Wei – Jefferies & Company

I am sorry, prior to coming into phase 3, the number of overall survival then could be low, wouldn’t you have the overall survival data from the whole study?

Charles Morris

What I mean is in terms of being able to make a definitive statements whether we are like – whether we have seen a prolongation of overall survival, but yes, I think the PFS dates are the ones which we’re going to be debating on that investment decision.

Thomas Wei - Jefferies & Company

But before you go into -- I guess before you go into an actual pivotal trial if you had a prolongation of PFS in this study but there is no overall survival benefit on the 120 patients, would you move this forward into a pivotal trial?

Daniel Junius

I'm reluctant to give you an absolute answer without seeing the full data set but I think it would be a much more difficult decision if we see PFS improvement but no overall survival benefit.

Thomas Wei - Jefferies & Company

And then just one last question, for a study, are there really only two time points where you are looking at the data or is this something where you have the ability to look at it, really at any point in time that you choose so that ASCO of 2014 you would actually do a more mature cut of the data and get maybe on all 120 patients?

Charles Morris

The initial design of the study are those two time points, obviously with further follow ups, yes there may be the ability to provide further follow on data at a later time and obviously what we would do would be to continue to observe and make those decisions as we go. But certainly we’re not intending any additional looks at the data within the initial point after the PFS data from the first one bunch (ph) of patients.

Operator

And we’ll go next to Yale Jen from Roth Capital Partners.

Yale Jen - Roth Capital Partners

I have two. The first one is for SAR3419. Just like to get some update or anything you can talk about in the program?

Daniel Junius

Well, SAR3419 just for everyone's benefit is under development by sanofi and is currently in three Phase 2 studies, one of them being a combination study with Rituxan. Two of those are in diffused large B-cell and I think one is in ALL. We should be seeing data on that. I haven’t -- don't have any definitive information. I know that ASCO would be an opportunity, sanofi in the past has used ASCO as an opportunity to disclose data around 3419. So I think that's the best picture I can give you at the moment. I know it's continuing to advance. They remain encouraged by the program but we'll just have to see what they decide to do from a data disclosure standpoint.

Yale Jen - Roth Capital Partners

And the follow up question on 901, which is that the median progression free survival is about 5.5 months, I guess from the current treatment, where you’re looking at roughly six months progression free survival at six months. So these numbers seem to be very close. So how do you reconcile – is anything to read into that?

Charles Morris

No, I think what we have chosen is that is it appropriate point in time, remember so the market is relatively essential, it’s the median is about 5.5 months, we would expect historically the data of PFS of six months would be around about 40%, 60% -- 40%, 45% of patients being progression free at that point and so that becomes the assumption based off of the PFS six but what we are trying to do is try and find the buying the end points and the continuum end point of the design to study, so we will use a PFS at six months.

Operator

And we’ll go to Ryan Martins from Lazard Capital Markets.

Ryan Martins - Lazard Capital Markets

Just wanted to clarify, did you say you are not expecting to recognize any T-DM1 royalties in this fiscal year? Just wanted to clarify that.

Gregory Perry

Yeah, this is Greg. This is correct. So the PDUFA February 26 and our expectation that in this reporting cycle would be a quarter in arrears, we didn’t include any T-DM1 royalties in this fiscal year guidance.

Operator

There are no further questions in the queue. At this time I will turn the conference back over to Carol Hausner for closing remarks.

Carol Hausner

I would like to thank everyone for your interest in ImmunoGen, and if you have any additional questions, please don’t hesitate to call. Have a good day.

Operator

This concludes today’s conference. Thank you for your participation. You may now disconnect.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: ImmunoGen's CEO Discusses F2Q 2013 Results - Earnings Call Transcript
This Transcript
All Transcripts