Atara Biotherapeutics, Inc.

Greetings, and welcome to Atara Biotherapeutics Q2 2022 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn this conference over to your host, Mr. Eric Hellengrand, Vice President of Investor Relations and Finance. Thank you, sir. You may begin.

Thank you, Operator. Good afternoon, everyone, and welcome to ATARA's second quarter 2022 results conference call. Earlier today, we issued a press release announcing our second quarter financial results and corporate update. This press release and an updated slide deck are available in the Investors and Media section at atarabio.com. On today's call, members from the ATARA executive team will provide an update on our financial results, operational progress, and strategy. and also review our upcoming key milestones and objectives. Joining me on today's call are Dr. Pascal Tuchon, President and Chief Executive Officer, Dr. Jacob Dupont, Executive Vice President and Global Head of Research and Development, Upal Kopikar, Chief Financial Officer, and Dr. A.J. Joshi, Chief Medical Officer. We will begin with prepared comments from Pascal and Jacob, then open up the call for your questions. We would like to remind listeners that during the call, the company's management will be making forward-looking statements. Actual results could differ materially from those stated or implied by our forward-looking statements due to risks and uncertainties associated with the company's business. These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release and the company's SEC filing. These statements are made as of today's date, and the company undertakes no obligation to update these statements. Now, I'd like to turn the call over to Pascal Pascal.

Thank you, Eric, and thank you all for joining us this afternoon. Today, we announce plans to further focus our company's activities as a leaner research and development centered organization designed to advance our innovative pipeline while at the same time reducing our future cash birth. This includes a reduction of staff by approximately 20% across the organization and a reduction in planned annual cash burn of over 20 percent versus last year. These actions are expected to extend our cash on the way into Q1 of 2024, while still delivering on key milestones for most advanced strategic assets in terms of potential value creation, , 81-88, and . Deveraging or differentiated allogeneic T-cell therapy platform and ATARA unique clinical experience in more than 500 patients treated. We will prioritize R&D activities over the next 18 months on three core priorities. First, the clinical development of ATA-188, a potentially transformative phase two asset for progressive multiple sclerosis. the EU and potential U.S. regulatory filings and approval for TAPCEL, while seeking a commercial partner for TAPCEL in the U.S., including all related activities and cost, which is expected to further extend the company cash runway. Finally, the anticipated Q4 2022 IND filing for ATA3219, a potential best-in-class halogenic CD19 CAR-T, which could address significant opportunity in this field for improving durable clinical response in how to treat B-cell malignancies. We believe these three product candidates could have meaningful impact on patients in great need and could deliver significant value for ATARA and our shareholders. These actions are part of a strategy to focus the organization on research and development and build on the previously announced strategic partnership on manufacturing with Fujifilm Dioxin Biotechnologies and our commercialization collaboration with Pierre Fabre. The prioritization and actions announced today are a continuation of this strategy. We believe this strategy is well-suited for the current position of the company today. It includes new opportunities for future strategic partnerships and non-dilutive funding, and it optimizes resources to advance development for lead clinical and pipeline assets. Let me know detail of progress and plans for key strategic priorities. As we announced in July, we have completed the interim analysis of the ATA-188 Phase II EMBOLD study, and following the IDSMC recommendation, and importantly, or on internal assessment, we determined that no sample size adjustment or modification will be made to the study. Based on enrollment at the end of July, approximately 90 patients are planned to be included in the readout of the study primary endpoint of confirmed disability improvement by EDSS at 12 months, which the FDA recommended as a primary endpoint. We expect to communicate this final data readout in October of 2023. We are pleased with the progress made on the EMBOL study and are confident in the possibility for AT188 to deliver significant clinical improvement to non-active progressive MS patients. Indeed, targeting EBV-infected B-cell is now a well-supported therapeutic hypothesis towards finding a transformative treatment for this debilitating disease. The recent publication in Nature showed how EBV-infected B cells drive pathology in MS by stimulating autoreactive T cells and by differentiating into autoreactive plasma cells. These EBV-infected B cells present in a CNS can drive chronic inflammation in the brain and the generation of reactive antibodies against some brain proteins. We are therefore excited about the potential of 8188 to address the disease at its core in targeting these EBV-infected B cells and plasma cells. In addition to this robust scientific rationale, our confidence and leadership in pursuing our EBV-targeted approach is reinforced by the encouraging clinical data shown in our phase one and open-label extension studies so far. As a reminder, in the phase one study, 33% of the 12 patients in the IDALS 8188 cohorts achieved confirmed EDSS improvement at the 12-month time point, an FDA registration appropriate and primary endpoint framework. Furthermore, the Phase I study in its open-label extension showed that 20 out of 24 patients have had either confirmed EDSS improvement or EDSS stability throughout their observation in the study or open-label extension for up to 42 months. In Q4 of this year, we plan to present at a conference updated data from the OLE and new Phase I MRI data, providing further evidence of the potential clinical impact of 8188 in progressive MS patients. Also, we continue to plan for Phase III readiness, including interacting with the FDA based on our two fast-track designations. Importantly, we're also continuing to further develop and scale up our proprietary bioreactor manufacturing process, which we expect to enable biologic-like cost of goods manufactured. Finally, we will continue to be opportunistic in exploring potential partnering opportunities with biopharma companies that could maximize the value creation potential of ATA-188. Following the EMBOLD IA, A number of companies have confirmed interest in a potential partnership, and we plan to have further discussion in the future with a keen focus on generating significant value. Another key strategic priority to create value is TAPSEL. I would like now to give an update on TAPSEL, starting with our recent progress on the U.S. regulatory front. Indeed, following constructive discussion with the FDA, including senior leadership, The agency recommended a potential path to BLA submission without the need for a new clinical trial. We are very pleased with this outcome, and following additional upcoming scheduled interactions with the FDA, we will give further guidance on progress to a BLA submission at our next quarterly earning call. We believe that TAP-Cell can become a potentially life-saving option for those EBV-positive PTLD patients in need with poor prognosis and no approved treatment options. We also believe TAP-Cell can deliver compelling value proposition for payers and the healthcare system. We already knew that physicians have strong interest in TAP-Cell based upon the clinical data presented last year at ASH. More recently, our US payer market research and payer advisory boards have shown us that payers and treating institutions clearly see TAP-Cell as an important therapeutic improvement for the high-need, previously treated, EBV-positive PTLD patient population. Atara's belief in TAP-Cell value proposition has been recently supported by the CMS decision in its newly released 2023 IPPS rule to formally assign TAP-Cell to DRG18, which is a diagnosis-related story of this technical difficulty, would like to resume the call and just starting at TAP-Cell. As I said, another key strategic priority to create value is TAP-Cell. I would like now to give an update on TAP-Cell, starting with our recent progress on the U.S. regulatory front. Following constructive discussions with the FDA, including senior leadership, the agency recommended a potential path to BLA submission without the need for a new clinical trial. We are very pleased with this outcome. And following additional upcoming scheduled interactions with the FDA, we will give further guidance on progress to a BLA submission at our next quarterly earnings call. We believe that TabCell can become a potentially life-saving option for those EPV-positive PTLD patients in need with poor prognosis and no approved treatment options. We also believe TAP-Cell can deliver a compelling value proposition for payers and the healthcare system. We already knew that physicians have strong interest in TAP-Cell based upon the clinical data presented last year at ASH. More recently, our U.S. Payer Market Research and Payer Advisory Board have shown us that payers and treating institutions clearly see TAP-Cell as an important therapeutic improvement for the high-need previously treated EBV-positive PTLD patient population. ATARA's belief in TAP-cell value proposition has been recently supported by the CMS decision in its newly released 2023 IPPS rule to formally assign TAP-cell to DRG18, which is a diagnosis-related group that includes CAR-T. Obtaining such assignment in advance of BLA filing is extremely rare and is based on compelling value arguments developed by our team for such a potentially lifesaving therapy for patients with EBV-positive PTLD. Once TAP-Cell is approved, this will improve access to reimbursement for patients in need. As we have said before, we believe that the TAP-Cell EBV-positive PTLD market is an attractive, ultra-rare opportunity with several hundred addressable patients in the U.S. who could benefit from this therapy. When considering pricing in line with TAP-Cell's value for patients and the healthcare system, we believe that TAP-Cell has the potential to deliver peak sales in the U.S. of over $500 million. coming from cells in EBV-positive PTLD following previous therapy, or first indication that we are intent, and potential labor expansion from the multicore study. To realize such significant value opportunities, we have decided to seek a partner for commercializing TAP cells in the U.S. that could invest appropriately into commercialization activities, while ATARA will focus on getting TAP cell fields approved in the near term. and on expanding the label in the future. At this stage, I want to thank our team at ATARA who have devoted tremendous effort in order to establish a solid foundation for the launch of TAPCEL once approved. Moving on to Europe, we passed all pre-approval inspection for GMP compliance required to support the marketing authorization application for TAPCEL in Europe. This is excellent progress. And the European Medicine Agency, or EMA, review of TAP-Cell is on track, following our submission of answers to all Day 120 questions. We anticipate European Commission approval in Q4 2022. Our commercial partner, Pierre Fabre, is actively preparing for the TAP-Cell launch in Europe, and we have already manufactured more than one year of commercial product inventory. I am excited that we, along with our partners at Pierre Fabre, are very close to bringing TAP cells to the market, thereby generating value for patients and shareholders. Now, I would like to hand over to Jacob to provide more details on our CAR-T portfolio and strategy before I give you an update on our financials. Jacob?