Immunomedics, Inc. (IMMU) CEO Michael Pehl on Q1 2019 Results - Earnings Call Transcript

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About: Immunomedics, Inc. (IMMU)
by: SA Transcripts

Immunomedics, Inc. (NASDAQ:IMMU) Q1 2019 Earnings Conference Call November 7, 2018 5:00 PM ET

Executives

Chau Cheng - Senior Director, Investor Relations and Corporate Secretary

Michael Pehl - President and Chief Executive Officer

Brendan Delaney - Chief Commercial Officer

Rob Iannone - Head of R&D and Chief Medical Officer

Usama Malik - Chief Business Officer

Analysts

Mike Schmidt - Guggenheim

Paul Choi - Goldman Sachs

Phil Nadeau - Cowen and Company

Nick Abbott - Wells Fargo

Madhu Kumar - B. Riley FBR

Operator

Good afternoon ladies and gentlemen. Thank you for standing by. Welcome to our First Quarter Fiscal 2019 Results Conference Call. As a reminder this call is being recorded. Today is Wednesday, November 7, 2018.

At this time, I would like to turn the conference over to Chau Cheng, Senior Director Investor Relations and Corporate Secretary of Immunomedics. Please go ahead.

Chau Cheng

Thank you, Chris.

Before we begin I would like to remind everyone that during this call we will be making forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995. Such statements may involve significant risks and uncertainties and therefore actual results could differ materially from those expressed or implied on this call. For factors that could cause such differences please refer to our regulatory filings with the Securities and Exchange Commission. Most recently our quarterly reports for the first fiscal quarter ended September 30, 2018. The earnings report is available on our Web site at immunomedics.com.

With us on the call today are Michael Pehl, President and Chief Executive Officer; Usama Malik, Interim Chief Financial Officer and Chief Business Officer; Brandon Delaney, Chief Commercial Officer; and Dr. Robert Iannone, Head of Research and Development and Chief Medical Officer. Following the prepared remarks, we will open up the call for questions.

At this time, I'd like to turn the call over to Michael.

Michael Pehl

Thank you, Chau. Good afternoon everyone and thank you for joining us today.

Before we start, I wanted to thank all our teams for their hard work and dedication during the last months. The company has made significant progress in the first fiscal quarter as we continue to focus on our regulatory, clinical, manufacturing and launched proprietary efforts. Based on recent mid cycle discussions with the FDA, the company will continue to work closely and collaboratively with the agency to address outstanding review issues and does not anticipate an Oncology Drugs Advisory Committee meeting to be convened.

As you all know patients with metastatic triple negative breast cancer are in dire need of better treatment options. Our entire team is dedicated to bringing sacituzumab govitecan for its highly differentiated benefit risk profile to these patients and it's focused on a potential marketing approval by the PDUFA date of January 18, 2019.

We are progressing as planned with our solo preparation for a highly successful commercial launch. Our goal is to provide sacituzumab govitecan to TNBC patients in need within days of approval. We have therefore recently recruited and started training for 50 highly qualified sales representatives all of whom have experience in the solid tumor field.

In addition, the commercial leadership team across marketing, sales and market access is now fully staffed. Brandon will give you an update on our launch preparedness momentarily.

On the manufacturing side, the company has entered into a long-term manufacturing partnership with Samsung Biologics is our second source manufacturer of hRS7, the antibody used in sacituzumab govitecan to prepare for the anticipated future demand driven by additional indications and by broadening of our geographic footprint.

With tech transfer and engineering runs already underway, we believe commercial production from the new facility will begin in early 2020 subject to future regulatory approval. We have also further broadened our clinical development activities. Our clinical collaboration with AstraZeneca on the development of the combination of the durvalumab and sacituzumab govitecan has been expanded to include second line metastatic non-small cell lung cancer utilizing AstraZeneca's existing development infrastructure. Rob would provide you with more detail on this study.

First, Usama will go over the financials.

Usama Malik

Thank you, Michael.

I will begin with a summary of our first quarter fiscal 2019 results. We had no revenues in the three month period that ended September 30, 2018, due primarily to the discontinued sale of LeukoScan during the third quarter of fiscal 2018 in order for the company to focus on its core ADC business.

Revenues in the three month period that ended September 30, 2017 were approximately $700,000. Total costs and expenses were $57.2 million for the three months that ended September 30, 2018 compared to $22.3 million for the three months that ended September 30, 2017 due primarily to a $20.9 million increase in research and development expenses at $8.5 million increase in G&A expenses and a 5.6 million increase in sales and marketing expenses.

Most of these increases were attributable to activities related to preparation for the potential approval and commercial launch of sacituzumab for patients with at least two prior lines of treatment for metastatic triple negative in the United States. We also continue to make progress towards our clinical and manufacturing development plans.

The company recognized $1.2 million in cash and non-cash income for the three months that ended September 30, 2018 compared to $86.4 million in non-cash expense for the three months that ended September 30, 2017. The decrease in expense was due primarily to the exercise of warrants partially offset by an increase in the fair market value of warrants outstanding.

Interest expense was $10.1 million for the three months that ended September 30, 2018 compared to $2.6 million for the three months that ended September 30, 2017. The increase was due primarily to increased debt balances as a result of the agreement with Royalty Pharma.

Net loss attributable to stockholders was $64.2 million or $0.34 per share for the three months that ended September 30, 2018 compared to $118.7 million or $0.97 per share for the same quarter in fiscal 2018. As of September 30, 2018, the company had $585.5 million in cash, cash equivalents and marketable securities which we believe is sufficient to support our next phase of growth. Further build our clinical, medical affairs, commercial and manufacturing infrastructure begin our efforts to commercialize sacituzumab govitecan globally and to fund our operations into 2021. That summarizes our first quarter fiscal 2019 financial results.

But before I turn the call over to Brendan let me highlight a subsequent event to further clean up our balance sheet on October 5, 2018, we completed the exchange of approximately $12.9 million in aggregate principal amount of our convertible senior notes for newly issued shares of our common stock pursuant to privately negotiated exchange agreements entered into between the company and a limited number of holders of the convertible senior notes. The remaining aggregate principal amount of the convertible senior notes is approximately $7.1 million. As of September 30, 2018, the number of outstanding shares was 187 million, the number of fully diluted share count remained at 205 million. Brendan?

Brendan Delaney

Thanks Usama.

As Michael alluded to earlier, our thorough preparation for commercial launch is nearing completion and our want objective is clear. It is to ensure that every appropriate metastatic triple negative breast cancer patient has the opportunity to benefit from sacituzumab govitecan as a new standard of care in the third line treatment setting. We have three strategic imperatives in support of that objective. First at launch, we need to drive rapid brand awareness and adoption by educating health care providers on the compelling efficacy and safety profile of the product. We expect to accomplish this through a robust marketing mix inclusive of sales promotion, peer-to-peer education, digital and non-personal promotion.

Second, we need to ensure a positive first experience with the brand for healthcare providers, patients and caregivers alike. This includes minimizing barriers to access and reimbursement, setting appropriate therapy expectations and providing support for therapy management.

Third, we need to seize the leadership position in triple negative breast cancer by establishing Immunomedics as a trusted and differentiated partner committed to advancing the treatment and scientific understanding of this disease.

Continuing on our launch readiness efforts, I am excited to inform you that our newly hired sales team is officially on board Immunomedics. Their first day was this past Monday, November 5 and I would like to extend my warmest welcome to these newest members of the Immunomedics family. As we speak, this entire team is assembled in New Jersey and participating in an immersive live training week that serves as the kickoff to an intense training program.

Our sales training team has worked diligently for months to build a curriculum that we believe will ensure that our representatives are products and disease experts by day one of launch. I am extremely impressed by the caliber of people, we have been able to hire on our sales team. All have deep oncology experience with the majority also having a background in the breast cancer space. On average our new sales representatives have between 15 to 20 years of Oncology sales experience.

I am also happy to announce that prior to bringing on the sales team, we also hired our new team of national account managers. This season group of market access professionals have been out in the field meeting with national, regional and local payers and other key customer organizations in order to familiarize them with the vision and mission of Immunomedics and laying the foundation for broad patient coverage and rapid reimbursement at launch.

Our network of specialty distributors is in place to ensure a smooth buying process across all sites of administration. Additionally, our access services including a call center and comprehensive patient hub services are fully launch ready. We have built an impressive commercial organization over the last 12 months. I am grateful for the support of our executive leadership team. I would like to thank my commercial leadership team and the cross-functional partners here at Immunomedics for making this possible.

With that, I'll hand the call over to Rob. Thank you.

Rob Iannone

Thank you, Brendan.

Let me comment on expanding our current collaboration agreement with AstraZeneca to include non-small cell lung cancer. The treatment landscape in non-small cell lung cancer is rapidly changing. Just last week the FDA approved the combination of Keytruda and chemotherapy for first line metastatic squamous non-small cell lung cancer.

As immune checkpoint inhibitors are more commonly used in front line, there will be a growing number of patients whose only option and second line is single agent chemotherapies such as taxanes and these have poor outcomes.

You may recall in 2017, we published a paper reporting encouraging response rates and durability of response in a highly refractory population of non-small cell lung cancer patients with single agent sacituzumab govitecan. And these included patients previously treated with PD-1 or PD-L1 inhibitors.

Based on this encouraging activity, we think it makes sense to explore sacituzumab govitecan further in second line non-small cell lung cancer and also to evaluate it in combination with continued PD-L1 blockade as we were planning to do in collaboration with AstraZeneca.

With that, I will turn it back over to Michael.

Michael Pehl

Thank you, Rob, Brendan and Usama.

In summary, we are working very hard and interacting closely with the agency to address outstanding review issues and to bring sacituzumab govitecan to TNBC patients in need as fast as possible. We also have an industry leading team in place to execute our broad clinical development and commercial plans for sacituzumab govitecan and have further build out our strategic manufacturing operations to ensure that we will be able to meet anticipated demand from future indications and geographies.

With that, operator, please open the call up to questions. Thank you very much.

Question-and-Answer Session

Operator

Thank you. [Operator Instructions] And our first question comes from Mike Schmidt with Guggenheim. Your line is now open.

Mike Schmidt

Thanks for taking my questions. Michael I had a follow-up on it on a comment you just made regarding sort of mid-cycle FDA interaction. You did mention of some outstanding review issues, can you just comment a little bit further on that?

Michael Pehl

Yes. So we've got a -- I think a good sense for the ODAC meeting at this mid-cycle review meeting. What we certainly need to say here and very clearly is that the nature of our ongoing discussions with the agency are very confidential and sensitive. So we should really stay away from any public speculation or discussion.

What I can share with you is of course that we're working very closely and collaboratively with the agency and are working very hard to answer any open review issues and questions, but I can't unfortunately give you any further detail on that, I really ask for your understanding.

Mike Schmidt

Okay, great. Thank you. And then maybe a question on the expand AstraZeneca collaboration and sort of my question here was -- maybe not just in non-small lung cancer, but also in some of the other indications that are being evaluated. Is there a mechanistic rationale potentially for a synergy with a PD-1 inhibitor in combination or is that a scenario where one would expect additive and you obviously have seen some very good [indiscernible] activity for example in non-small cell lung cancer?

Michael Pehl

It's a great question thank you and it's an area that we're very interested in studying further. What we know now versus when PD-1 inhibitors were first being developed is that you can combine with chemotherapy to the ultimate benefit of patients. What remains to be answered is whether different cytotoxic therapies might be superior to others. And so we think sacituzumab given the targeted nature could be a very good combination partner for immunotherapies, adding [indiscernible] potentially without more systemic immunosuppression. And it's a theory that we're going to be testing in clinical trials that are very rich and translational science to support our underlying scientific understanding.

Mike Schmidt

Okay. And then, maybe one more, I know you did recently this is regarding potentially lateral expansion opportunities. I know you did recently initiated the metastatic urothelial pivotal study and I was just wondering if you -- where do you stand with initiating some of the other studies that you have talked about earlier this summer that could potentially expand the label of sacituzumab?

Michael Pehl

Everything that we discussed previously is in progress and on track according to our internal timelines.

Mike Schmidt

Okay, great. With that I will hop back in the queue. Thank you.

Operator

Thank you. And our next question comes from Matthew Harrison with Morgan Stanley. Your line is now open.

Unidentified Analyst

Hello. This is Ismael on from Matthew. Thank you for taking our questions. Just curious, are you anticipating an advisory committee into the action to meet and on global filings where are current discussions with European authorities and what are the key next steps there? Thank you.

Michael Pehl

So thanks for the question Ismael. So no, we're not anticipating any advisory committee at this moment of time as we said. We are -- we had interactions with European authorities throughout the year and not just with one of the leading national agencies, but with a couple in order to get a really broad overview on the situation that has led us to conclude that there is several opportunities for us for a regulatory approval in Europe starting by using our current package and trying to go for an accelerated approval which is a pathway that does exist in Europe as well.

And then, on the other extreme there is certainly always this traditional way of waiting until your Phase 3 readout is coming. What we also heard loud and clear is that there is this path in Europe now by which you can start the regulatory process with the package at hand, and then, you bring in top-line data from your Phase 3 study at a very late time point of the review process that has the advantage that -- if you then go into reimbursement discussions you have data from a Phase 3 study in your label and that just puts you in a very different and much more favorable position, if you're talking about reimbursement. So we are very much leaning towards the second option. And we are continuing our discussion with the agency as we speak.

Unidentified Analyst

Great. Thank you for all the color.

Michael Pehl

Thanks Ismael.

Operator

Thank you. And our next question comes from Paul Choi with Goldman Sachs. Your line is now open.

Paul Choi

Hi, everybody. And thanks for taking our questions. Maybe a little bit more on the expansion and with AstraZeneca. First of all, will this study be folded into and ongoing another Astra study and as you think about the populations you're targeting, would this be mostly a sort of a keynote 189 chemo combo experienced population or are you also thinking about stage three patients the so-called Pacific population for which [emtansine] [ph] is approved?

Rob Iannone

So at the moment we are really considering the second line post PD-1 chemotherapy not the more limited stage Pacific. That obviously isn't something we could consider in the future. And while we haven't finalized our exact plans for development there are opportunities within the AstraZeneca portfolio to add this to an ongoing trial.

Paul Choi

Okay. Thanks for that Rob. And then, another company recently got approval to initiate a pivotal trial in CDK46 experienced patients. And which might provide a benchmark for sacituzumab govitecan. Have you gotten any clarification with regard to a trial design for your own trial? And is that something you could elaborate on here.

Rob Iannone

Sure. So we are in the midst of discussions with FDA on that. So we have gotten some really helpful input to them and it's pretty straightforward actually. So in that particular population patients who have exhausted hormonal therapy and CDK46 inhibitors are then essentially eligible for a single agent chemotherapy and there are a number of options as to how we might approach that in terms of where we go after chemotherapy. So we're progressing those plans as we had previously disclosed.

Michael Pehl

Yes. And we plan to have and we plan to have, this is Michael, we plan to have an investor conference at San Antonio. And we're going to inform you about the exact date and this is where we can talk in detail about the design of that study and we will do so.

Paul Choi

Okay, great. And last question on the pipeline Rob are you -- is timing still on track for a potential interim look in mid-2019 or so for the bladder cancer trial?

Rob Iannone

I don't believe we've talked specifically about the timeline. So what I can say is that the trial is up and running, its accruing patients and it's a high priority for us and continue to pay a lot of attention to the recruitment there and to accelerate as much as possible. And yes, we have built in an interim analysis so that we'll have an opportunity to look at a subset of patients’ response rate and follow up. And the idea there is if we do it with enough patients then we would have the data to engage FDA around and around potential for breakthrough designation for example.

Paul Choi

Okay. Thanks for taking our questions and congratulations on all the progress.

Michael Pehl

Thanks very much.

Operator

Thank you. And our next question comes from Phil Nadeau with Cowen and Company. Your line is now open.

Phil Nadeau

Good evening. Thanks for taking my questions. First another one on the AstraZeneca collaboration. In the past you've talked about also investigating IMMU-132 monotherapy a non-small cell lung cancer. Is this additional trial with AstraZeneca can be added on to the monotherapy study or is this in place of it?

Rob Iannone

No. It's in addition to and so we've talked about having a basket trial where we would include tumor types such as non-small cell lung cancer where we would want to explore further sacituzumab monotherapy and we could also in that context learn quite a bit about the potential to enrich for a response using a biomarker. So our intent is to set up a basket trial that could -- that would include monotherapy a non-small cell lung cancer, but could also include other tumor types and would be the heavy biomarker rich.

This is in addition to that and the fundamental idea is that, if patients benefit from chemotherapy and immune checkpoint blockade, but then ultimately progress, we think that's a perfect place to have sacituzumab. But there's an open question as to whether continuation of that PD-L1 blockade in the context of a more active more cytotoxic agent such as and directed agents such as sacituzumab whether continued blockade would benefit patients. And so that's the fundamental question in the AstraZeneca collaboration.

Phil Nadeau

Got it. Okay. And in that basket trial you -- as you just mentioned you might use a trip to assay, will the trip to assay be included in the AstraZeneca trial or is that a totally separate question that more of a backdrop.

Rob Iannone

Not as a prospective enrichment tool. But we certainly would be in all of our trials using the assay we're developing better validated assay to look at the role of drop to in response to sacituzumab. So we'll look at it there but not the way -- like in patients.

Phil Nadeau

Got it. Okay. Then the question on the sales force training -- training the sales force two months front of PDUFA seems to be quite early. I think most companies tend to do it close to the PDUFA date, so what is the rationale for already having this sales force on board, are you going to do non-branded disease marketing in front of the PDUFA. Why are they trained and ready so early?

Brendan Delaney

I don't necessarily think it's early from my experience that we'll have -- it's about six to eight week training curriculum that the sales training folks have put together and that that includes a lot of KOL type of interactions and it's really well done. And I think as you would agree we want to make sure these people are experts who can go out there with the right science, evidence-based approach and quickly gain credibility in the market.

So I disagree that this is too early. I think trying to cram it in and ensure that that we have people who are trained in the appropriate way out there at the last minute is just not the way we want to do it and that's we want to ensure launch success and having people well-trained as part of that, right.

Michael Pehl

To further amplify what Brendan just said. This is Michael. This is all about quality and we think the key differentiating factor for us in the market is the quality of those studies but then also the quality of the information and the people that are providing the information. So we really want to make sure that they get this very deep and insight into the disease not just into the product in order to provide quality to our future prescribers.

Phil Nadeau

Got it. One last question for you Michael on the issues that you alluded to with the FDA, appreciating that the confidential, you don't want to go into those areas specifically but in your experience of going through a number of oncology reviews or any of these issues surprising or they generally standard type of questions that come up in most reviews.

Michael Pehl

I totally understand why you ask this question. And I hope you see us speaking here with a lot of passion and confidence, so I hope that is answering your question. The point that I also want to make is, we absolutely stand by our data as we've been presenting at ASCO this year. We think we have a highly differentiated product with a great benefit risk profile and a triple negative breast cancer need this progress. So I'm really my apologies that I can't deep dive into it publicly explain in more detail than that but I hope you'll hear the passion and the excitement of the team.

Phil Nadeau

Fair enough. Thanks for taking my questions.

Michael Pehl

Thank you.

Operator

Thank you. And our next question comes from Jim Birchenough with Wells Fargo. Your line is now open.

Nick Abbott

Good afternoon, Nick in for Jim this afternoon. Michael we're getting very close here so congratulations to you. A quick one maybe it's up for Brendan. Brendan what is the reach of 50 reps is that most of tertiary care centers should be expect an expansion in 2019 as you need to start covering more community based oncologists?

Brendan Delaney

I don't think as far as the triple negative breast cancer opportunity I think we are sized pretty well. Nick, if you look at the way the territories break down in the targeting, if you look at the Tier 1 and Tier 2 prescribers within each territory currently configured they account for about 70% to 80% of the prescriptions in that territory. So if you start doing the math on realistic expectations on region frequency there, we think we're pretty adequately sized to cover the majority of the business and that's not to say that we're going to leave the other tiers of physicians alone. We'll just have a different approach to whether it's non-personal promotion and then a different call frequency with that.

So we feel pretty confident the way the territories play out and where the bulk of the business is that we'll be able to cover the prescriber base adequately. Obviously, we think some of it will be early adopted in the academic centers. And what that also translates to that hundred prescribers is really concentrated on average in about 25 to 30 accounts within a territory as we're configured. And again, we think that's pretty manageable for an experienced oncology representative.

As far as an expansion, I think what we would consider is potentially when urothelial is on the horizon we may look and say and look at the kind of spread of that business and say what makes sense, but that would be the only opportunity I think we would consider expanding at this point.

Nick Abbott

Okay. Thank you. And then in terms of the ASCENT trial, has the enrollment progressing and we still -- should we still be expecting data 4Q ’19?

Rob Iannone

If the trials going well as expected and no change in our timelines at this point. As you know it's an event driven trial. So you just want to be careful not to revise timelines until you have enough events to predict that adequately. So based on where we are wouldn't change anything we've said in the past.

Nick Abbott

Okay. And then, in terms of additional studies in TNBC, obviously, when you announced the AstraZeneca and the Clovis collaborations those included TNBC studies. And I think in your introductory comments, Brendan, you said we want to be the experts and obviously there are several subtypes TNBC, if you had 100% response rate you would need to worry about the subtypes, but it's clearly the question going to be asked as to all of the subtypes of TNBC where this agent works better than other subtypes. So are you planning on doing some expansion studies or additional studies in this sort of relapsed refractory group of patients to try and address this? Or can you answer those questions from the ASCENT trials, some of the other trials you've got planned?

Brendan Delaney

All of that, we are going to do additional trials as part of the lifecycle management, but we also within the trials we're already doing are asking some of the very questions you're highlighting. So for example, our strategy to get into first line is multipronged. So if we can develop and enrich a biomarker potentially monotherapy sacituzumab could be used even in first line because the therapies there are not particularly good.

Our second part of our strategy there is in combination. And so for example with PARP inhibitors and we've initiated we will be initiating a trial with Clovis to demonstrate safety and dose selection with rucaparib that will be another way to get into an earlier line of therapy.

Lastly, some of the recent events and the study readouts for the [indiscernible] for example, I think are clarifying the treatment landscape moving forward where some patients in first line will get a PD-L1 inhibitor but not all. And so there's the so-called PD-L1 low will continue to get conventional chemotherapy upfront and that's a population I think we could target.

Furthermore, with the clarity around how PD-L1s were used in first line, it opens up a space in second line very similar to what we were describing in non-small cell lung cancer, so patients are getting first line PD-L1 and chemo then that second line space remains pretty open where the competitors are single agent chemotherapist that are not particularly good. So we're looking certainly to expand in the first line and second line as monotherapy with biomarker enrichment and through rational recombinant.

Nick Abbott

Okay. Thank you and then maybe just one last one on the new ACE Study. So you're looking to enroll two different cohorts’ patients depending on the primarily required or refractory required resistance. Those trials have a 132 monotherapy arm, so you can truly understand the contribution of continuing the PD-L -- the PD-1 pathway inhibitor.

Rob Iannone

Not initially. It's like the first time, this is -- will be given a non-small cell lung cancer is a combination. We want to start as a single arm in each of those two cohorts. But the idea is to learn what we can quickly from that, and then, potentially move into something more definitive. But I definitely get your point I mean ultimately you would want to say do sacituzumab plus or minus to fully characterize there.

Nick Abbott

Okay. Thank you very much and look forward to seeing you in town, hopefully without snow this year.

Michael Pehl

Thanks Nick.

Operator

Thank you. And our next question comes from Madhu Kumar with B. Riley FBR. Your line is now open.

Madhu Kumar

Yes. Thanks for taking my question. So kind of thinking about how the triple negative breast cancer landscape has changed with -- it’s not a recent data on checkpoint drugs in the space. How do you think that affects the disease there is a little kind of responsiveness and therapeutic effect of 132?

Rob Iannone

Thank you. I will try and maybe Brandon could comment, it goes a little bit to the answer I gave to the prior question. I think that it clarifies which patient populations are likely to benefit from PD-L1 antagonists like T cell. It's a fraction of about 40%. So the remainder 60% there standard treatment is just as it was before these trials read out.

And then, subsequently like non-small cell lung cancer patients who are benefiting from immune therapy but then progress in particular that's a space where we want to be with sacituzumab. But again, to ask the question, would continue PD-L1 blockade make sense in that setting and that becomes a more open space for us to fully characterize it.

It's certainly possible that as patients become refractory to the primary chemotherapy component, the synergy with PD-L1s is not as great and so slopping out to a more effective cytotoxic like sacituzumab could not only be good in its own right but benefit from the continuation of PD-L1 inhibitor. That's the fundamental scientific hypothesis that we would like to test ultimately. And I think it's going to become increasingly relevant across different tumor types. We may be having a similar conversation about urothelial six months from now head and neck et cetera.

Brendan Delaney

Hey, Madhu. I'll just comment as well from my angle. Number one, this is important in progress for patients which is fantastic. I think we all agree on that. There's reason to believe in discussions with KOLs recently as recently as yesterday. They don't have any reason to believe that this sacituzumab is not going to work as well after patients who see a checkpoint inhibitor.

There's also reason to believe that potentially it could lead to patients showing up in the third line setting less beat up by intensive chemotherapy which could be a good thing and a positive thing. I think it also many ways expand the market in some ways and potentially given the way a label may come out of two prior treatments, the question of whether this would qualify as two prior treatments hence allowing people to get to sacituzumab govitecan even earlier is something that could play out not guaranteed, but it was interesting to think of what that could mean as wells so.

Madhu Kumar

Also thinking about non-small cell lung cancer, I mean you described the idea of going after in the post PD-1 chemo setting and I guess it’s a difficult program because of the efficacy of PD-1 in chemo. Would you ever consider running a few frontline patients under the rationale that 132 is in some senses the chemotherapy with a much better therapeutic window to some degree?

Brendan Delaney

Absolutely. The studies are likely to be done whether we do them ourselves or through an investigator initiated trials where we will tend to focus our main development program is on the highest unmet medical need where we think it will be more straightforward to show a clear benefit and ultimately get it labeled indication. So that's why it's logical to follow the patients who progress or to go like in the first line breast, the patients who are not expected to benefit at all from PD-1 inhibitors like the PD-L1 knows.

Madhu Kumar

Okay. And then kind of -- as a common theme emerges that many of your trials kind of put 132 head-to-head against -- tagged in or microtubule based chemotherapies. As more evidence emerges about kind of post PD-1 therapy, we know there are certain drug classes that appear to be better after PD-1 therapy than they would do otherwise. I think [indiscernible] TKI, kidney cancer for example. Is there any evidence that taxing therapies do better in the post PD-1 setting than they would do kind of under regular non-PD-1 conditions?

Rob Iannone

Not that I know of yet. I mean I think that there's a lot -- there's a fair amount of speculation on why the OS benefits are so robust with PD-L1 inhibitors and more so even than PFS and whether there's some continued benefit even beyond progression but at this point in time, I guess what I could say is, there's no reason to think that that benefit if one exists wouldn't extend also to sacituzumab and not just other chemotherapies.

It's an area of interest of ours to understand the immune profile of sacituzumab. We think that a targeted cytotoxic like this may be more immunogenic in terms of the cytotoxicity and partner better with PD-L1 inhibitors that's something that remains to be studied. But we do know that many chemotherapies that often are given with a lot of steroids for either for emesis or fusional toxicities may have broader immunosuppressive effects that wouldn't be ideal for combining. So it's an area that we're eager to learn more about for sure.

Madhu Kumar

Okay, great. Thanks for taking my questions.

Operator

Thank you. And that does conclude today's question-and-answer session. I would now like to turn the call back to Chau Cheng for any further remarks.

Chau Cheng

Thank you all very much for joining us this afternoon on behalf of the entire leadership team. I'd like also to thank you for your continued support and interest in Immunomedics.

Operator

Ladies and gentlemen that does conclude today's program. You may all disconnect and everyone have a great day.