Arcus Biosciences, Inc.

phase three study for TIGIT antibody in combination with their anti-PD1 antibody in FENZI, currently the standard of care in stage three non-small cell lung cancer. This leverages their leadership in this setting. Activities remain on track to support initiation of this study by year end. In addition, we are discussing additional clinical collaborations. We also have a partnership with Taiho, under which they received an option to our programs in Japan and other countries in Asia, excluding China, and they have already opted into both eTRUMA and ZIM. This month, Taiho's IND for ZIM in Japan was cleared, enabling them to initiate their platform study, evaluating ZIM in combination with other molecules in their portfolio, anticipated to begin in the third quarter. Discussions around optin to our other clinical stage molecules are also underway. Finally, in China, we have a great partnership with Wuxi, who manufactures all of our biologics. We also maintain a strong relationship with Gloria, who has the China rights to our PD-1 antibodies in. They have filed for approval of XIM in China for classical Hodgkin's lymphoma and are rapidly advancing a registration study in cervical cancer in China as well. Underpinning all of this is our extraordinary team, now over 300 employees with approximately 80% in R&D. Our development organization now exceeds 120 staff most of whom joined us with strong experience from large biopharmaceutical companies. With $805 million of cash in investments at the end of June, we have plenty of capital to prosecute our programs over the near term and expect our current cash balance will fund operations through at least 2023. Now, on to our clinical programs. First, our TIGIT program and Dom Vanillamab, or Dom, our FC silent TIGIT antibody. In June, we conducted an interim analysis for ARK7, a randomized Phase II study in first-line metastatic non-small cell lung cancer with 50% or greater PD-L1 expression. ARK7 was designed to provide valuable information, and it includes three arms. Zimbirellumab, or Zim, are PD-1 antibody. Zim plus Dom, or the doublet, and Zim plus Dom plus Etruma are adenosine 2A2B receptor antagonists, or the triplet. ARC7 has a target enrollment of 50 patients per arm, about twice the size of Cityscape's dataset in PD-L1 high patients. If this was an early interim analysis designed for internal decision-making, The dataset was inherently immature. Nevertheless, the totality of the data was encouraging for all three arms, enabled us to make several important decisions. Number one, ARC-7 and ARC-10, a registrational study for Dom plus Zim in the same population, will continue as planned with no changes. We continue to advance our ongoing joint efforts with Gilead to prepare for several Phase III studies for DOM, where we believe we can be a market leader with an antitiget antibody, with the goal of starting at least one of these studies by year-end. Three, with AstraZeneca, we agreed that Pacific 8 preparation will continue as planned with study initiation by year-end. And four, based upon the intriguing data for the triplet, we are actively exploring other opportunities for this combination. On our call to discuss the interim analysis, we mentioned a very important finding. A quarter of patients that responded in the study did so after 3.5 months. This is a frequently seen observation with IO therapies. Therefore, we believe that with further data maturity, the overall response rates or ORRs for the arms will likely improve over time, particularly since at the time of the interim analysis, several patients had completed only one disease assessment. Recall that we are doing disease assessments every six weeks. In Roche's Cityscape study in this setting, the ORR for their TIGIT doublet improved from 55% at the time of the abstract based on a median follow-up of six months to 66% at the time of the data presentation based on a median follow-up of 11 months. And we could see similar evolution in response rates for the DOM combinations over time in ARC-7 with more scans and follow-up. We recognize there's been a lot of interest in understanding the performance of the doublet versus the triplet. While the data sets were small and lacked maturity, we were absolutely encouraged by the performance of both of these arms. Regarding the triplet, we included this arm because CD73 expression is known to be high in non-small cell lung cancer. In fact, our analysis of a panel of lung cancer tumor samples has revealed a strong correlation between high PD-L1 and high CD73 expression. Quite excited to see the triplet arm performing particularly well across multiple measures, including ORR and depth of response. More mature data will enable us to confirm this activity, assess durability, and better understand how much of the triplet activity is driven by DOM versus eTRUMA. As I mentioned, based on these data, we are very interested in pursuing other settings with the triplet. In fact, an investigator-sponsored trial was just initiated to evaluate the triplet in non-small cell lung cancer patients previously treated with checkpoint inhibitor therapy. AHRQ 7 is enrolling well, and we plan to submit data later this year for presentation. Our objective is to present a data set that has high impact for AHRQ and the field, and we are considering conferences that occur late this year as well as in the first half of next year. Finally, to round our discussion of Dom, we continue to enroll our Phase III study in the same patient population as ARC7. This study is designed to enable the potential approval of both Zim monotherapy and Zim plus Dom. We also have an FC-enabled TIGIT antibody, AB308. We believe we are the only company with TIGIT antibodies of both configurations in clinical development And having a second-digit antibody provides us with a huge amount of flexibility as we think about future clinical collaborations and commercial strategy. We started dose escalation of AB308 with our PD-1 antibody earlier this year and just completed enrollment of the third dosing cohort. So this study has progressed rapidly. In fact, we have selected the recommended dose for expansion and are on track to start five planned expansion cohorts in the third quarter. The objectives for these expansion cohorts are to generate signals and tumor types to further inform our Phase III strategy for our antitiget program and to assess AB308 safety and activity in certain hematological cancers where we believe that FC function may be important. We continue to believe that the collective data to date suggests that an FC silent TIGIT antibody may be advantageous in solid tumors. And future clinical data sets should provide more insight into whether FC silent TIGIT antibodies have a more favorable long-term safety profile due to a lack of prolonged Treg depletion in the periphery. To wrap up our TIGIT discussion, I'll comment briefly on the Gilead optin. Gilead has the ability to opt-in at any time, up until we obtain a data set on a pre-specified number of patients. If they decide to trigger their opt-in review period, Gilead will have a certain period of time to make their opt-in decision. We anticipate an opt-in trigger decision by Gilead for our anti-tigit program by year-end 2021. Exercise of the opt-in would trigger a $275 million payment to ARCIS, as well as 50% development cost sharing for both the DOM and AB308 programs. Now on to our ATP adenosine programs. We have established ourselves as a leader, and perhaps the leader, in ATP adenosine biology with two first-in-class and potentially best-in-class molecules. eTRUMA and our dual A2A2B adenosine receptor antagonist, and AB680, also referred to as QEMLI, our small molecule CD73 inhibitor. These molecules target the second and third nodes in the ATP adenosine pathway, thereby blocking adenosine formation and its action at its cognate receptors, respectively, and the ensuing suppression of immune cells. We also expect to advance our antibody against CD39, the first node in the ATP adenosine pathway, into clinical development in 2022. We've now presented data from several Phase 1 and 1B studies, including at ASCO-GI, AACR, and ASCO in 2021, which provided early clinical evidence supporting the advancement of both eTRUMA and QEMLI, and our ongoing randomized studies are designed to confirm these findings. For eTRUMA, we've recently reported encouraging data in three settings, two of which, colorectal and prostate cancer, represent tumor types where PD-1s alone have not shown meaningful activity. First, at AACR, we presented data from ARP3, our Phase I-1b study that evaluated the TRUMA plus FOLFOX and third-line plus metastatic colorectal cancer. The combination was well-tolerated and resulted in a median progression-free survival of 4.2 months approximately double the two months reported for current standard of care therapies in the setting. We also observed a doubling in overall survival as compared to what would be expected with standard of care. These results have generated significant investigator interest in our follow-on study, the ARC-3, which we call ARC-9, our randomized phase two study in metastatic colorectal cancer. This study is evaluating the same combination plus zimborellamab with or without Bev versus standard of care in the second and third line setting. And it has a target enrollment of approximately 200 patients across those two settings. We just completed enrollment of the safety run-in for these cohorts and expect to initiate the randomized portions shortly. The second important data set for TRUMA came from a cohort of ARC6, our Phase 1B2 study in castrate-resistant prostate cancer, evaluating Etruma plus docetaxel plus Zimbirellamab versus docetaxel in second-line patients that had progressed following treatment with one or more new hormonal agents. At ASCO, we presented encouraging efficacy and safety data from the Stage 1 single-arm portion of this cohort. Specifically, in 17 efficacy-available patients treated with this eTRUMA combination, we observed a PSA response of 35%, which compares favorably to 27% for previous studies of docetaxel alone in a comparable patient population. In a smaller subset of patients with measurable disease, 27% experienced a radiographic response, which compares to in the teens for docetaxel in previous studies. In this subset, every patient achieved at least stable disease, with almost all patients achieving some tumor shrinkage. This was in an advanced patient population, many of whom had received more than one novel hormonal therapy, and the vast majority of whom had soft tissue disease. Based upon these data, we opened the randomized portion of the study, which is enrolling well and is anticipated to complete enrollment by year-end. In these studies, the safety profile of the combination was consistent with the known profiles of each individual agent, and no significant additive toxicity was observed with the addition of Atruma. Finally, while still early, the triplet data from ARK7 may provide additional evidence supporting the potential clinical activity of a TRUMA. In addition to ARK6 in prostate, ARK7 in lung, and ARK9 in colorectal cancers, we are conducting a fourth randomized study for a TRUMA, ARK4, our Phase II study in patients with EGF receptor-positive lung cancer who have progressed on TKIs. This study is comparing a TRUMA plus Zyn plus chemo to Zyn plus chemo in just recently completed enrollment with 70 patients treated across both arms. Now on to QEMLE and ARC-AID, our Phase 1-1B study in first-line metastatic pancreatic cancer. At ASCO-GI, we reported initial data from the dose escalation portion of this study. In the 17 efficacy-evaluable patients, QEMLI plus ZIM plus gemcitabine and napaklitaxel demonstrated a 41% unconfirmed response rate with at least some tumor shrinkage in almost all patients. Since then, we have completed enrollment of the expansion cohort, and we are now enrolling the randomized portion of this study, which is evaluating QEMLI plus gem-NAPTAC with Taxel with and without ZIM, and will inform the design of the Phase III trial. This portion, which will include approximately 90 patients, is on track to complete enrollment by year-end, which is ahead of plan. The data continue to look quite promising, particularly the high percentage of patients that experience tumor shrinkage and the safety profile of the combination. Our focus is now on durability of response, and we look forward to sharing updated data from the study later this year. We've also continued our planning activities to initiate a phase three study next year in first-line patients. I can't overstate the investigator enthusiasm for this program. With investigator input, we are now initiating an additional cohort in the ARCAID study targeting second-line patients previously treated with fulfirinox to further characterize this combination in a setting where basically patients have no meaningful option. And now on to what's expected to be our next clinical program, our HIF-2-alpha inhibitor, AB521. Excitement for this mechanism continues to grow as a result of data generated by Merck's HIF2-alpha inhibitor in a clear-cell renal cell carcinoma and VHL disease. And at AACR, we presented preclinical data for our program. Based upon these preclinical data, we expect AB521 to have a superior PK profile in humans relative to the Merck molecule, which we believe may give us the ability to inhibit this pathway more effectively and at lower doses. We are on track to initiate a study in healthy volunteers in the fourth quarter. The healthy volunteer study will give us the opportunity to demonstrate potential PK and PT advantages very quickly and enable us to advance AB521 into cancer patients with a very well-characterized dosing regimen. While there's a growing amount of activity targeting HIF-2-alpha, this is a difficult target to drug, and we believe we have created an ideal therapeutic candidate. Also, the breadth of our portfolio creates exciting opportunities to develop novel HIF-2-alpha combinations. For example, we know that CD73 is upregulated by hypoxia. Therefore, we are very interested in combining 8521 with Ytruma or QEMLI in RCC and other tumor types characterized by a hypoxic gene signature. While we don't have time today to get into our early efforts, our discovery focus remains intense with a full portfolio of programs that will continue to sustain our clinical pipeline. Before we move on to the financials, I want to spend a minute or two on our anticipated news flow for the next 12 months. For Dom, we plan to submit ARC 7 data this year for presentation at a medical conference, with the actual presentation occurring either late this year or the first half of next year. And as I mentioned earlier, we anticipate an opt-in trigger decision by Gilead for our anti-tigit program by year-end 2021. For QEMLI or AB680, we expect to provide updated data from the ARC-8 study in the first-line pancreatic cancer setting this fall. Given how quickly the randomized portion has enrolled, with enrollment on track to complete by year-end, we anticipate presenting ORR in six-month survival data from the dose expansion, as well as initial data from the randomized portion in mid-2022. For atreuma, We plan to present data, including on ORR and PFS, from our 70-patient randomized study for ARK4, our study in EGF receptor-positive non-small cell lung cancer, in the first half of 2022. We also expect to present randomized ORR and preliminary PFS data from ARK6 and prostate cancer in 2022. And finally, for AB521, our HIF2-alpha inhibitor, with information from our Healthy Volunteer Study, we anticipate initiating the Phase 1B study and oncology indications in the first half of 2022. We now have five ongoing randomized Phase 2 studies that are designed to provide definitive datasets prior to registrational studies. To preserve the integrity of these studies and to provide meaningful readouts, Increasingly, our data readouts will occur after completion of enrollment and achievement of event-driven milestones. Between these studies and our earlier state studies, as well as the activity of our partners, we expect a very steady flow of news over the coming months and year. And with that, I'm now going to turn the call over to Bob Geltz, our CFO, to review our financials.

Thanks, Terry. I'll touch on a few of the highlights from our second quarter of 2021 financial results. For more details regarding our results, please refer to our earnings press release from earlier today in our 10Q. Argus continues to be in a strong financial position. Our cash position as of June 30th, 2021 was $805 million, compared to $735 million at the end of 2020. The $220 million in proceeds we raised from our February sale of stock to Gilead has strengthened our balance sheet. We expect our current cash balance will fund operations through at least 2023. Now turning to our operating results. Revenue was $9.5 million, which is unchanged as compared to the first quarter of this year and increased as compared to $1.8 million for the second quarter of last year. The increase in revenue as compared to last year was attributable to our collaboration with Gilead. We expect current revenue levels to continue for the remainder of 2021, excluding the impact of any option. Our operating expenses for the second quarter were $86 million as compared to $82 million in the first quarter of this year and $47 million in the second quarter of last year. In the current quarter, non-cash stock compensation represented $13.4 million of our operating expenses. Increases in operating expenses in the second quarter were due to continued advancement of our clinical pipeline and associated manufacturing costs. In particular, manufacturing of DOM and Atruma in preparation for potential pivotal studies was the primary driver of cost increases in the second quarter. We expect this investment in manufacturing to increase modestly over the remainder of 2021. Overall, ARCIS remains in a strong position to fund the advancement of our pipeline. As a reminder, opt-ins by Gilead for our advanced clinical programs, DOM, ITERUMA, and QEMLI, would result in opt-in payments from Gilead of $200 million to $275 million per program, and Gilead would co-fund go-forward development of these programs. The financial structure of this collaboration provides ARKIS with substantial non-dilutive resources to continue to invest in our pipeline as it advances. I'll now turn it back over to Terry for some closing remarks before Q&A.

So thank you very much, Bob. We're doing a lot, and we've covered a lot today. So let me please close with a few highlights that summarize why I've never been more optimistic about ARKIS' future than I am today. Our five clinical stage molecules are progressing extremely well with a sixth, AB521, our HIF-2-alpha inhibitor, expected to enter the clinic later this year. The ARC-7 interim analysis provided us with a valuable data set, including intriguing data for the triplet, which we will understand better as the data matured. For Atruma, we now have four ongoing randomized studies, all of which we'll read out over the next 12 months to confirm the activity observed in our earlier data sets. For QEMLI, enrollment in Arc 8 remains brisk. Investigator enthusiasm remains very substantial, and the data continue to look promising. We anticipate sharing data on durability from the escalation and expansion cohorts later this year and data from the 90-patient randomized portion by mid-next year. And we anticipate a start of a registrational trial in 2022. We'll now open up the line to questions. Thank you.

Certainly. We will now begin the Q&A session. Participants are limited to one question and one follow-up for today's call. If you would like to ask a question, please press star followed by 1 on your touchtone keypad. If for any reason you would like to remove that question, please press star followed by 2. Again, to ask a question, press star 1. The first question is from Alicia Young with Cantor. Please proceed.

Hey, guys. Thanks for taking my question. And congrats on all the progress over the quarter. I'd be remiss if I didn't ask another question about Arc 7. I apologize in advance. I'm just curious, you know, if you think with the data that you're generating here that it might be possible to kind of move faster into, like, an adaptive Phase 3, and then just kind of the follow-on to that is that can you just talk about, like, the scenario if Gilead does not bend, how you guys might think about developing that program? Thanks.

Sure. So, Karthik, why don't you handle the first part of the question, and then I'll come back and get to the if Gilead did not opt-in scenario. Okay?

Sure.

So the first part about an adaptive Phase 3, I think we want to see the Arc 7 data mature, understanding of course we have the DOM-Zen combination being interrogated in Phase 3 and Arc 10. So the answer to your question is maybe if we see more data, we certainly would want to be able to exercise our nimble qualities and adapt accordingly. Kerry, do you want to talk about that?

Sure. So thanks, Alethea. And so let me start by first saying we continue to believe in, you know, you can tell by the planning activities, Gilead is very enthusiastic about this. Gilead, we're planning together. They all... When we talk, we talk more about how fast can we go post that opt-in. But I'd still like to engage your scenario. And in that situation, we will be moving aggressively. And, in fact, you know, we believe there's a number of other parties actually who are quite interested in the program. So more likely than not. Given the breadth of the opportunity, we would be going full speed without pausing, but likely bring on another partner along the way as well.

That's interesting. Thanks. And, yeah, no, I feel comfortable hopefully that Gilead locks in, but just was curious about that scenario. Thanks a lot.

Thank you.

Thank you, Ms. Young. The next question is from Peter Watson with Barclays. Please proceed.

Great. Thanks so much. Thanks for taking the questions. Terry, if you could remind us about the opt-in timeline for TIGID and adenosine from Gilead, and are they kind of waiting for the ARC-7 data for adenosine, or is that at a later time?

So I'll pass that one along to Jen to answer, please. Sure.

So our expectation, as we said, is that Gilead will start the opt-in trigger this year. As a reminder, it's a two-step process. So the first step of that process is they need to make a determination that they are going to start their opt-in review period. Once they make that determination, they have a certain period of time, basically a few months, before they make the ultimate decision. It's hard to imagine they would need that full time period to do the review based on their familiarity with the program's but they would have that time if they wanted it or they needed it. And so, like I said, our expectation is that they start that review period by the end of the year based on more mature data from ARC-7. And I'm sorry, Peter, remind me of the second part of the question.

Yeah, just around adenosine, if that has a different set of triggers, and when does that run to?

Every study, this is a reminder how the optin works. Gilead can optin at any point. time up until a certain point so they're often period does expire at some point and it's different for every program the idea though for every program though is that the opt-in trigger would typically be randomized data and from somewhere between 20 to 25 patients or so, 20 to 30 patients or so. We have not disclosed what the optin triggers are for everything or for anything. For some programs it's specified in agreement, for some it's TBD, but that's generally what the approach to the optins are. I think Gillian said on their call last week that their expectation right now is that the optin decisions for a TRUMA and AB680 would be made next year. which is in line with when we would expect to have our first randomized data from those programs.

Okay, thank you. And then just on the HIF-2-alpha program, can you remind us when that enters the clinic and kind of the differentiation versus, I guess, the data we saw earlier this year?

So why don't we let Juan answer that question and give him a chance? Sure. Hi, Peter.

Hello. Hi, Peter. Yeah, so we intend to initiate the Healthy Volunteer Phase 1 study later this year. Everything is on track for that. The plan is then to utilize that data, generate PK, PD, some initial safety information, and accelerate into a cancer patient population in the first half of next year with that information. We believe, based on preclinical characterization of the molecule, that it may have a superior pharmacokinetic profile to Bilzotifan, the Merck drug, and that as a result of that, we may be able to explore a higher level of target inhibition that that molecule and that, you know, potentially that might translate into an improved or greater clinical benefit.

Thank you so much. Thanks for taking the questions.

Thank you, Peter.

Thank you, Mr. Lawson. The next question is from Jeffrey Porges with SVB Lyric. Please proceed.

Thank you very much. I appreciate the strategy overview, Terry. I actually thought your strategy was to invent drugs with unpronounceable chemical names that require abbreviation. So first question is, it's not every day your CMO departs to a partner. Could you just explain to us why investors shouldn't regard that as a negative indicator, given what we would presume is the personal and professional opportunity of staying at ARCIS? And then secondly, on ARC7, I believe you have a second interim scheduled for later this year. Can you tell us when that is and whether you'll be giving us any further update from that second interim? And will that second interim data be included in what you submit for presentation?

So thanks for both questions, Jeff, and also your comment. I'm the worst on names, so I hate that. I have a hard time with anything that's more than one, maybe two syllables. Bill, I think your lead-in probably says a lot about it. It's a very unusual circumstance. And it's no question, I think it's great for Bill, it's great for Arcus, and it's great for Gilead. So on Gilead, and I would let them speak to the reasons, and I think you know as they build out their group, why it's good for them. For us, You know, it puts a person in Gilead who's extraordinarily familiar with what we're doing, has passion for what we're doing, understands how that ties together with, you know, Gilead's broader strategy. And the other piece is that Bill, you know, Bill's an outstanding builder of teams. The group we have in place, as I mentioned earlier in the call, is already over 120 people. It's a phenomenal leadership group. You know, you hear Kartik on the phone. Kartik, as you know, has been intimately involved in, you know, for all practical purposes, running the clinical program for at least the last four to six months. So we're super well positioned on all fronts. So I think Bill is happy as well in terms of he, I think, has a proclivity for a larger company, and he maintains the relationship with the people here, many of whom he has long-term relationships, not the least of which and has the opportunity to continue to work with ARCIS on the development of those programs. So I actually think investors should look at that as a real positive across the board, both for ARCIS and Gilead. And the relationship remains strong, you know, both professionally and personally as well. So if anything, it ties us a little closer. Insofar as the second part of your question about taking another peek at the data, we have not said anything explicit about that. What I'll say is, as you know, insofar as the opt-in, Gilead has mentioned that a prime interest to them and we're interested as well in seeing a look and a cut of a more mature data set. Couple that together with the notion of a likely opt-in decision prior to the year end, so it gives you a sense of approximately when that might occur. So while we haven't described that, we actually haven't decided upon the next time that we will look under the hood. But we do not plan to disclose anything about that at the time. So the next thing that you should expect to hear from us would just be, you know, something relating to Gilead's decision-making. So we don't intend to put out a pre-announcement and create some sort of, you know, crazy flurry of activity around a particular day doing that again, and we don't plan to specifically share the data until that ultimate medical conference presentation.

Great. Thanks, Terry. Thank you so much, Jeff.

Thank you, Mr. Porges. The next question is from Robin Conarchus with Truist Securities. Please proceed.

Hey, guys. This is Kirpa on for Robin. Thank you so much for taking my question. Regarding opting into the Adenosine programs, on their earnings call, you know, Gilead noted the decision could come next year, like Jen just mentioned, but they also multiple times emphasized that if the data looks really strong, they want to move in as quickly as possible, that they would like to opt in early. Could you provide any color on what the likelihood of that is? Could the triplet data that you see towards the end of the year accelerate that process. And also, you know, a lot of questions on Arc 7, but on their call, again, they provided a lot of color, but no specific details on what would get them to opt in. Can you help us understand a little bit better what they might be looking in terms of separation, specific delta between the doublet and the triplet, or like Jens had a threshold of patience, the durability, any color would be really helpful. Thank you.

Jen, do you want to comment on the total event? If there's anything you need, I'll jump in and see if you can cover it.

Yeah, so I will start off. So they certainly could opt in early, and I'm sure, you know, whether it's with Dom or 8680 in particular, I would suspect they've thought of it, but they certainly don't have to. You know, I think it's still to be seen, you know, whether or not they take the full amount of time they have for each of these opt-in decisions or, you know, if they do opt-in early. What I would say is... We obviously have a lot of money, you know, thanks to them. They've given us a lot of money. And so, you know, whether they opt in early or wait, it doesn't really impact our ability to move quickly. So that's the good news. And there's also lots and lots of engagement between our two companies prior to these opt-ins. So even on DOM, I said the way the collaboration is working for that product today is much more like a partnership than they're sitting there, you know, waiting for us to send data over the Transom. So there's already – a lot of collaboration on CNC, on regulatory, on these next wave of studies that we're both planning together. So there's a lot going on between the companies, and I think because of that, you know, there's always a possibility that they could opt in early. I'd say on your second question on ARC-7, You know, probably a question for them in terms of exactly what they're looking for. I think they were very encouraged, like we were, by the data set. I think, like us, they were particularly intrigued by the performance of the triplet arm. And I think both us and them are watching closely as the data matures to see how much of that triplet activity was being driven by DOM and, you know, which have a really good doublet, or there's something differentiated there with the TRUMA and with the triplet. So that's something that we're both paying close attention to as the data matures. They do have an end date, as I mentioned earlier, which is a patient-based end date. So, you know, as we talk about an opt-in decision trigger being made by the end of the year, that's why we're comfortable saying that, as well as just the ongoing dialogue we have with them and how we know that they're thinking But I do think in general what they're looking for is just more follow-up. You know, as we've talked about, we have patients on the study had a medium number of two and a half scans, but we obviously had patients on the study that had only had one scan. We know that responses with IO can take time, and, you know, we're seeing responses after three scans. So we want to see how the data matures and see just a bit more patients and understand the triplet on better.

So, thanks, Jen. What I'll add is one additional piece, Kripa, and obviously all this is, you could find out from Gilead sort of what all the aspects of what motivates them and when, et cetera. But one important thing to recognize, so in the context of that early Etruma, in thinking about an Etruma opt-in, in the context, let's say, of the triplet, so there is no doubt that data continue to hold up with the triplet, we're going to be developing that very, very aggressively and very broadly given the ubiquitous role of adenosine across cancers. And so one aspect, if we were moving ahead very aggressively with the triplet, Gilead's involvement, despite the fact that it's pretty seamless in terms of how we do things, but their influence over that development program expands once they've opted in just by the way we sort of have governance in the program. So that's another factor that could enter into the play of a desire to be much more, you know, participating at certain levels insofar as how that you know, ultimate broad development program might be executed upon.

Thank you. That was very helpful.

Thank you, Kripa.

Thank you, Miss. The next question is from Umar Rafat with Evercore. Please proceed.

Hi, guys. This is Mike DeFiore in for Umar. Thanks so much for taking my question. I'm just curious. You mentioned the Pacific 8 trial that's set to start in 4Q this year, evaluating DOM plus DERVA. Just wondering if you could tell us a little bit more about this trial and what would be considered a good bogey in terms of ORR. Recognizing that the ARC-7 data is immature, could there be possibly any read-through based on how the doublet arm in ARC-7 is tracking? Thank you.

Yeah, so I think I'll take that, Kurt, because insofar as specific aid, we have not disclosed any details about how we're thinking about that. And I think that'll come out closer to when the trial gets up and going. So together with AstraZeneca, we've been doing a lot of planning together. They're also a great group with which to work. We've been enjoying working with them, moving on that also as quickly as possible, but haven't shared any details at all on how we're thinking about that. I missed the second part of your question about a read-through.

Yeah, just recognizing the ARC-7 data is mature. I mean, with respect to the doublet arm in that trial, based on how that could be tracking, could there be any read-through to Pacific 8, assuming that that trial will be testing Dom plus Derby and Combo as well?

Got you. No, we've shared the data that we had from the interim analysis in great detail with, you know, call my colleagues at AstraZeneca, and we're going as, you know, as fast as possible to get that study initiated.

Thank you.

Thank you.

Thank you. Thank you, Mr. Ruffin. The next question is from Yago Melcho Melvitz with Citi. Please proceed.

Hi, Terry and Jen and team. Thank you for taking the question. So on Arc 7, getting your comments around the triplet, I think it's fair to say that you are seeing some synergistic activity with the Truma combined with Dom and Zim. So curious if at this point, if you formulated a working hypothesis as to what the biological mechanism might be that's driving the synergy you're seeing.

Sure. So I'll let Juan speak to that, but keep in mind we went into the study with some underlying biology in mind, and I'll let Juan comment on exactly how we look at that.

Absolutely. It's actually very simple. If you assume that the combination of PD-1 and PIDGET inhibition is leading to activation of some T cell population, we know that that must be happening in spite of the fact that there's a high amount of adenosine floating around in that tumor type. As Terry pointed out, we find that high PD-L1 long tumors tend to also have a high level of C73. So we take it as a given that that clinical benefit that results from PD-1 integer inhibition could be enhanced by removing that adenosine fog from the environment or preventing it from blocking full T cell activation. OK, thank you.

And just one quick follow-up on ARK8. I'm just wondering why you decided not to include a monotherapy arm in that trial. For example, doing a monotherapy gem of paclitaxel because then you could tease out the contribution of CREMLI to the doublet and the contribution of CREMLI and ZIM to the triplet. Sure.

So thanks for that one, Egal. So in our initial discussions with the FDA, at least in this early trial, the belief was that the Gemabraxane signal is so well understood that they did not feel we should include that in the initial uh study at least um and instead we um talk with them since anti-pd1 therapy um is to date has shown no help in this particular setting. We looked in our randomized portion to segregate out the effect of the anti-PD-1. So you've got the chemo plus AB680 plus Zim versus the doublet lacking the Zim. So the way we look at it, and we'll obviously have to sort this out based upon the data and our discussions with the health authorities, but we think that might ultimately lead us to a registrational trial that's a two-armed study where we would then be looking against that well-defined combination versus the chemo alone.

Got it. Thank you.

Thank you, Jeff.

The next question is for Mara Goldstein with Mizuho. Please proceed.

Great. Thanks so much for taking the question. Just to go back to Arc 7 for a moment and ask if it's possible, Terry, for you guys to give us some additional details or maybe even directionality around the understanding of the percentage of patients in let's say the doublet arm versus the triplet arm that may have had at least two scans at the next look and how that would compare them to the sort of first data cut and then I just had a question um and I suppose this is a somewhat philosophical question about ab308 and understanding that this represents an opportunity for you to look at right the effect of having a FC enabled candidate versus SC Silent on some of these questions around long-term issues around suppression of Tregs. But how then do you think about sort of near-term efficacy data as it may relate to the development of DOM and the comparison between the two?

We don't really look at it as a bake-off. We started believing and continue to believe that the antitiget antibodies are going to behave as antitiget antibodies. We'll be pushing AB154 as hard as possible, and then strategically we'll continue, as you know, with 308. And our focus with 308 will look towards those hematological malignancies, whereas we've discussed before certain of those malignancies for example, multiple myeloma where TIGID is actually found on the tumor cells and you might want to have that potential effect or function. But we believe in the solid tumor setting in which there is no situation like that, we're going to get all the efficacy in the world out of that blocking mechanism and We'll see over time if that translates into anything relating to a side effect profile. The only comment I would make on the scans part of it is that the median number of scans at this point was two, but there were a substantial number of patients that had only a single scan. So even in a couple of months, you know, we'll have, given that these are every six weekly scans, we expect that maturity of that data set you know, we feel quite confident, it's going to give us the, you know, clarity that we want to see at this stage.

All right. Thanks. I appreciate it.

Thank you, Mara.

The next question is from Salvin Richard with Goldman Sachs. Please proceed.

Good afternoon. Thanks for taking my question. With respect to the updated ARC8 data that's coming in the fall, can you help us understand what metrics you'll be focused on and remind us what is clinically meaningful in first-line PDAC?

Sure. So do you want to take that? A little bit hard to handle that one. Yeah.

Honestly, this is a phase one dose escalation and expansion with now proceeding into a randomized day. So we're following all of the metrics that we can. We're looking at responses. We're looking at, you know, as an immunotherapy, prolonged stable disease and disease control most specifically. Clinically meaningful at the time of registration is definitely going to be survival. So we're looking at In this maturing data set, landmark survival points, both as it relates to progression and overall survival, we haven't had the trial running to the point that we'll be able to speak on either of those necessarily with much maturity, but we should be able to look at the early end points in terms of disease control and response.

Thank you.

Thank you.

The next question is from Tom Schrader with BTIG. Please proceed.

Hi. This is Kaveri on for Tom. Thanks for taking our questions. Well, all my questions have been answered, but maybe one on the CRC program. You presented encouraging data from the ARC3 study. Can you talk about what drove your interest in adding PD-1 to the CRC trial as it is in the case of ARC9?

Sure, so thanks.

It was just like a follow-up. The second one, it's on the ARC-10 trial, similar to previously asked question, if not the same. Can you add 928 on to the study, to the ARC-10 study, if the data from ARC-7 trial are positive? Thank you.

So I'll answer that one, the second part, quickly, and then I'll let Juan talk about the role of anti-PD-1 in a study like the ARC-9 trial. So we would not look to add AB928 into ARC-10. In general, when you've got a registrational trial like that up and going, you can't just you know, add something else in like it's a platform. And, in fact, anything we would want to do with that triplet would involve starting a new, well-designed separate trial that would make sense as opposed to just trying to modify it the ongoing trial. And I'll let Warren comment a bit on the role of an anti-PD-1 on top of the earlier doublet.

Sure. So we interpreted the promising clinical trends in ARC3, that is combining the adenosine blocker with Folfax, holistically across the late line patients, but also the correlation with certain biomarkers such as TMB and C73 expression. We interpreted the totality of that as being consistent with a hypothesis, a hypothesis being the Folfax would, in addition to direct cancer cell killing would also trigger an immune secondary wave to that cell killing. And we took the evidence of 928, enhancing that benefit, as a suggestive of a strong immune component to that benefit. When we consider the optimal combination to follow up on that in a randomized control fashion in ARC9, it seemed pretty logical if we're postulating a T cell activation-driven benefit to layer the PD-1 blocker on top of the adenosine blocker. So the fact that PD-1 inhibition by itself doesn't provide much benefit was not enough of a reason for us not to consider the potential benefit when you are, in fact, initiating a T cell response by some other mechanism.

That's useful. Thank you so much. Thank you.

Thank you, Kabir.

The next question is from Sajan Shu with Berenberg. Please proceed.

Hi, good afternoon. Thanks for taking my question. The first one I want to ask about the two-digit antibodies. You mentioned you have selected the dose for your 308. I was wondering if the dose is the same as you used for Dawn. And that's the first question. And the second, I want to ask about the CD73 inhibitor. Since you're going to look at phase three registration trial design, I was wondering for Gilead to opt into this program, what's the timing look like and what we should be looking at data readouts for them to participate? And then also on that, just follow up, I think I recall you also are evaluating a oral formulation for this inhibitor. You talked about the problem there. Thank you.

Sure. Thank you very much. So let me just repeat those for the others in the room here. So the first question is the go-forward dose for AB308. um our second fidget antibody uh the second question um well the third question was um the uh cd73 inhibitor the oral um part what's happening there and i guess the middle question uh was what can we say about the optin um for the cd73 inhibitor so i'm going to let juan or kartik one of you answer the what we're thinking about AB308.

Yeah, so in terms of the dose, they're not the same. In fact, the recommended dose for expansion memo went out yesterday, so hot off the presses that the dose has been selected in the expansion cohort. We anticipate it will open soon. It's actually a lower dose than what we're using with Domino.

So I'll comment on the um on the gilead question we really don't know if it's something um you know better discussed uh with them but the idea in all likelihood is that um we feel that when we would actually get close to that um uh planning and you know, later stage planning of a registrational trial when we have the data set that fully supports that at least that would be a possibility where they might consider, particularly they've indicated an extreme enthusiasm for the program, for the pancreatic cancer setting, a desire to be very involved in even that initial registration or trial. So it's purely speculative, but going back to what I said earlier about the enhanced role they play in being involved in the trial execution and what they've articulated about a desire to be involved with AB680 and their excitement, you know, as we've shared, you know, data with them on this program, they have shown a strong passion for that. And someone remind me what the other question was? There was one other question. Oh, yeah. So on the oral, thank you. Thanks a lot. Yeah. So we basically demonstrated that we could achieve the desired levels of drug with the oral formulation. At this point, we're simply holding that in reserve. So think of it as putting that on the shelf. And the way we think about it is that, you know, strategically as we expand our efforts around AB680, or I'll try to say QEMLI. The idea might be that in certain settings, you might want to, for example, go to an oral regimen, depending on what the combination partner was. And in a case like that, we would bring the oral formulation into use. I would also just say the way we look at the profile, we would probably go with a loading dose of the IV formulation and then use the oral as a maintenance therapy.

Great. Thanks very much. Thank you. That's our number three question.

There are no additional questions waiting at this time. I'll now turn the conference over to management for any closing remarks.

Yes. So let me actually finish up.

I guess I would just thank everybody for joining. We appreciate the engagement. We appreciate the large interest in the questions. Thank you very much.

That concludes the conference call. Enjoy the rest of your day.

Thank you. Enjoy your day.