Allogene Therapeutics, Inc. ($ALLO)

Hello, and thank you for standing by, and welcome to Allogene Therapeutics Business Update Conference Call. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be aware that today's conference call is being recorded. I would now like to turn the call over to Christine Cassiano, Chief Corporate Affairs and Brand Strategy Officer. Ms. Cassiano, please go ahead.

Thank you, operator, and welcome to Allogene's conference call. This morning, Allogene initiated a press release announcing data from our interim futility analysis from the pivotal Phase II ALPHA 3 trial in first-line consolidation large B-cell lymphoma. This press release, webcast and accompanying slides are available on our website. Following our prepared remarks, we will host a Q&A session, and we'll keep the call to an hour. I'm joined today by Dr. David Chang, President and Chief Executive Officer; Dr. Zachry Roberts, Executive Vice President of Research and Development and Chief Medical Officer; Geoff Parker, Chief Financial Officer; and Dr. Jeff Sharman, Chair of the Lymphoma Research Executive Committee, SCRI at Valomet Valley Cancer Institute and Research Center. After opening remarks by Dr. Chang, Dr. Roberts will walk you through the key highlights of the interim futility analysis before introducing Dr. Sharman. Afterwards, I will present findings from our market research. During today's call, we will be making certain forward-looking statements. These may include statements regarding the success and timing of our ongoing and planned clinical trials, data presentations, regulatory filings, future research and development efforts, manufacturing capabilities, the safety and efficacy of our product candidates, commercial market forecasts and financial guidance among other things. These forward-looking statements are based on current information, assumptions and expectations that are subject to change. A description of potential risks can be found in our press release and latest SEC disclosure documents. You are cautioned not to place undue reliance on these forward-looking statements, and Allogene disclaims any obligation to update these statements. I'll now turn the call over to David.

Thank you, Christine. At Allogene, our mission is to unlock the transformative potential of CAR-T through our allogeneic platform. At its core, that mission is about democratizing cell therapy, expanding patient access, simplifying delivery for physicians and treatment centers and ultimately moving CAR-T earlier in the treatment paradigm, where it may have the greatest impact. That is why today's announcement is so important. We are excited to share the interim futility analysis from our pivotal randomized Phase II ALPHA III trial, evaluating Semacell as first-line consolidation in large B-cell lymphoma. Semacell achieved a 58.3% MRD clearance rate versus 16.7% in the observation arm, a 41.6% absolute difference exceeding the clinical meaningful benchmark of 25% to 30% reported in the literature. Just as importantly, this early efficacy signal is accompanied by an encouraging early safety profile. These early results represent an important step towards redefining first-line large B-cell lymphoma management. Today, many patients are simply observed after first-line therapy, despite remaining at high risk of relapse. And by the time relapse occurs, disease may be more difficult to control and patients may be less able to benefit. By bringing an off-the-shelf Allogeneic CAR-T approach into the first-line setting, we believe Semacell has the potential to intervene earlier reduced the risk of relapse and advance our broader vision of making CAR-T more available, more practical and more impactful for patients. On Slide 5, we outline what it takes to make this real. To unlock the full potential of CAR-T, it must deliver across 5 key dimensions. Safety, supporting use across broader care setting, including outpatient, speed being available when and where patients need it. Scalability, enabling consistent reward adoption, simplicity, reducing the burden of treatment with a onetime therapy and optimally efficacy because outcomes determine benefit for the patients. The first to determine whether our therapy can reach patients. The fifth determines whether it should -- what we are seeing with Allogeneic CAR-T, specifically with Semacell is the potential to address these dimensions in a way that enables that shift. Slide 6 frames the market opportunity at high level. If APA is successful, we believe it has potential to open a significant new market in the first line large B cell lymphoma consolidation. On the left is estimated total addressable market, approximately $5 billion, representing more than 14,700 patients annually across the U.S. and EU. On the right is the estimated potential Semacell opportunity within that market, approximately $2.5 billion to $3.5 billion or roughly 7,000 to 10,000 patients per year. Later, we will walk you through the assumptions behind that opportunity. The next several slides addresses the obvious question that follows what would need to be true for that market to open? And that comes down to physicians' willingness to test, identify and treat patients earlier, supported by a profile that can fit into real-world practice. That brings us to Slide 7. CT DNA-based MRD has emerged as 1 of the strongest predictor of treatment outcome in large B-cell lymphoma. Patients who do not pay MRD at the end of first-line therapy, shown in red line in this Kepler Mayer curve are at high risk of relapse. Most of these patients experienced progression within the first 24 months. In contrast, those who achieved MRD negativity have significantly better outcomes with a greater majority remaining progression-free at 3 years. So MRD testing gives us a window into treatment effectiveness and future risk of relapse. And it raises fundamental question. if we can identify those patients earlier, can we intervene before relapse occurs. Slide 8 shows how that could translate into practice. Today, patients with large B-cell lymphoma, who respond to first-line therapy, typically 6 cycles of chemo immunotherapy observed after treatment. While available first-line therapies are effective, approximately 30% were relapse and require second-line treatment, where the chance of cure diminishes greatly. AFA proposes a different approach, identify patients who are MRD positive at the end of first-line therapy and intervene at that point. This is not about disrupting our physicians practice. Instead, it is about integrating into the existing paradigm by incorporating Semacell as a seventh cycle of treatment for patients not cured by the first-line therapy. The reason this approach is compelling is timing. Treatment earlier in the disease course when tumor volume is low, with a onetime dose of Semacell to potentially clear MRD and prevent recurrence. It is all about the right product for the right patient at the right time in the right place. Turning to Slide 9. We have a framework for interpreting today's data. across multiple studies, a 25 to 30 percentage point difference MRD clearance has been associated with meaningful clinical benefit. The first study is transformed, which compared [ RIAs ] against autologous stem cell transplant. A retrospective MRD analysis using the same Cardassay being used in APAC III demonstrated that a 24% improvement in the MRD experience led to a 63% reduction in the risk of EFS event, corresponding to a hazard ratio of 0.375. The second illustration is IMVIGOR-11 trial, which randomized patients with bladder cancer who remain MRD positive after curative resection to adjuvant treatment with Tecentriq or observation. Again, a relatively small difference in MRD clearance was sufficient to reduce the risk of recurrence by 36%. Slide 10 visualizes that relationship with a focus on durability. Here, we see that an MRD clearance improvement of 24% correlates with durable benefit including a 27% improvement in 3-year EFS. Putting that in perspective, PolyB, which is approved for the first-line treatment of large B-cell lymphoma showed only a 6.5% improvement in 2-year PFS. These trials along with other published data illustrate that MRD clearance strongly correlates with clinical benefit. With that context, Slide 11 outlines the key questions we have been aiming to answer in this interim futility analysis. Do we see an early MRD clearance signal that if producing overall ARPA 3 study could lead to a meaningful clinical benefit. That's the safety profile support a path to our patient news. And can we deliver Semacell in the setting where patients are treated. With that, I will turn it over to Zach to walk through the data from interim futility analysis.

Thanks, David. I'll start by grounding us in the Alpha 3 trial design, as shown on Slide 13. Alta-3 is an open-label, randomized Phase II study designed as a registrational trial and in alignment with FDA guidance is targeting 220 patients with large B-cell lymphoma who are in response after first-line therapy, but remain MRD positive. Patients are randomized 1:1 to receive a single dose of Semacell following standard fludarabine and cyclophosphamide lymphodepletion or observation. The primary endpoint is event-free survival with progression-free survival, overall survival and MRD clearance as secondary endpoints. The study is powered to detect a 50% reduction in the risk of disease progression, new anti-lymphoma treatment or death from any cause, which together make up EFS, reflecting the intent to demonstrate meaningful clinical benefit. Turning to Slide 14. Patients enrolled into Alta-3 so have traditional features of high-risk disease. While residual disease is not only found in high-risk lymphomas, these higher-risk tumors have historically been more likely to progress. As a result, the study population is expected to be enriched for poor prognostic features. Across both arms, patients baseline disease characteristics demonstrate features associated with increased risk of relapse including bone marrow involvement, advanced stage disease, elevated IPI scores and high-risk genomic characteristics. These are the lymphomas that physicians worry about. Slide 15 captures the first-line therapies these patients received, as well as their responses to those regimens. In keeping with their high-risk disease features, the majority of patients received an intensified version of R-CHOP dose-adjusted EPOC R. Consistent with what we estimated when we launched the study, 75% of patients entered alpha 3 in a complete response by PET CT, and the remainder entered while in a partial response for which the current standard of care would be observation. Slide 16 shows the MRD clearance rate and kinetics. The protocol defined cutoff occurred when the 24th patient in this analysis set had undergone their day 45 post randomization MRD assessment. Depending on the timing of their enrollment, some patients had additional MRD samples collected at day 90, month 3 and every 3 months thereafter through the first year post randomization. As of their last MRD assessment prior to the data cutoff, 58.3% of patients in the Semacell arm were MRD negative compared to 16.7% in the observation arm representing an absolute improvement of 41.6 percentage points favoring Semacell. This exceeded the 25 to 30 percentage point benchmark David discussed earlier. Underscoring this encouraging treatment effect of Semacell, the clearance of MRD occurred rapidly post infusion. In the 12 patients in the treatment arm, we observed a decrease of 97.7% in the median circulating tumor DNA level at the day 45 assessment. In contrast, the median CTDNA level increased by 26.6% in the 12 patients in the observation arm. Taken together, we believe these data suggest that Semacell is capable of rapidly eliminating residual disease in this high-risk population. On Slide 17, we summarize the safety results observed as of the data cutoff. At the time of this analysis, Semacell was generally well tolerated. We observed no cases of CRS, ICANS or graft versus host disease. While the absence of any reported CRS and ICANS is notable, it bears mentioning that alpha 3 was designed to optimize all aspects of an allogeneic CAR-T product including its safety profile by treating patients early and when their disease volume is so low that it can only be measured by an ultrasensitive MRD test. Even with this in mind, the absence of CRS and ICANs in this interim analysis exceeded our expectations. Low-grade infections were evenly balanced between the 2 arms. Low-grade neurological events were reported in 6 patients in the Semacell arm, headache in 2 patients, dizziness in 4 patients, numbness or tingling in the hands or feet in 1 patient and alter taste in 1 patient. The observation arm reported 1 patient with dizziness. There were no treatment-related serious adverse events and no hospitalizations for treatment-related adverse events. The majority of patients were managed entirely in the outpatient setting. A major limitation of CAR-T treatment has been its toxicity, which requires patients to remain close to the treatment center for monitoring for up to 14 days post infusion and triggers frequent hospitalization to manage CRS or ICANS. This has limited broader use and has restricted patient access. We are very pleased with Semacel's early side effect profile. And if these early alpha 3 results remain consistent in the study overall, we believe there could be potential to deliver CAR-T entirely in outpatient settings. Slide 18 dives a bit deeper into Semacel's real-world feasibility. Alpha 3 is now being conducted across more than 60 sites with a balanced mix of academic and community centers. At the time of this interim futility analysis, approximately 33% of screening activity and Semacel infusions were conducted in community cancer centers, including sites with limited or no prior CAR-T experience. We believe the results observed thus far demonstrate that Semacel can be delivered in a broad range of care settings, which is critical to expanding access if Semacel is ultimately approved. That is the key for moving CAR-T earlier in the course of disease and has been a major goal of Alpha 3. Having heard from the Allogene team, we'd now like to turn to 1 of our investigators, Dr. Jeff Sharman, to share his perspective. Dr. Sharman is the Director of Research at the Willamette Valley Cancer Institute and Chair of the Lymphoma Research Executive Committee for Sarah Cannon Research Institute, which includes a network of more than 200 community oncology locations. Dr. Sharman is a renowned thought leader in the latest breakthroughs in hematologic oncology and has been instrumental in developing a number of important [ bances ] in the field. Dr. Sharman, you and several of your colleagues at U.S. Oncology SCRI have had a front row seat since the launch of Alpha 3, and you've been actively involved in screening and treating patients in alpha-3 at [ Lalami ] Valley Cancer Institute. Can you tell us about your practice, your history with CAR-T and your perspective on the data we've presented today to get us started?

Yes. Thank you so much for inviting me to be a part of this. That was a great introduction as well. My name is Jeff Sherman. I'm a community practice hematologist oncologist. I've been in community practice for about 18 years in my practice, I actually take care of all types of cancer, including bras coal and lung, prostate and so forth, although my interest is certainly in lymphoid malignancies, and that typically constitutes about 2/3 of my practice. I've helped lead the research program for our broader network. Originally, that was the U.S. Oncology Network. I know we've merged with Sarah Cannon -- we have not really been able to successfully deploy a commercial CAR-T program to date, and that really just has to do with payer limitations cost and sort of many of the features that make it challenging to move forward with CAR-T. We have treated 1 prior patient with [ lyso ] cell on a research study. I helped design the outreach study for BMS and managed to treat a patient on that study. But that was, again, only in the context of a research study. So my engagement in this study has allowed me to screen a number of patients treated sort of under routine standard of care. And we've identified a patient and when I had and treated on the study. So I will go from there.

Thank you, Dr. Sharma. As someone who has long been at the forefront of community-based cancer research, please provide your perspective on some of the gaps and access to CAR-T specifically for patients who receive care outside of academic settings.

Yes. I think the statistics -- and these are probably slightly older statistics, but something like 1 out of 5 patients who is eligible for CAR T actually receives them. And that's because many of these are done, they really require academic centers. So in my state like Oregon, we live -- the only place you can get CAR T is in Portland, which is in the top left corner of a very large state. And if you live in Eugene, where I do it's a 2-hour drive up to Portland. And that's introduced a lot of barriers for patients to go up there. They need to have a caregiver, they need to be physically present up there, and that just presents a number of insurmountable challenges for some patients. And I have absolutely had more conversations, and I wish I'd ever had about CAR-T, where I present it to a patient is, hey, I think this is what is appropriate and suitable for you. And I'm told by the patient. I can't do that. It unfortunately comes up more commonly than you would -- you would want. So I think the ability to deliver something in the community has long been 1 of my goals, that was sort of the impetus behind the design of the BMS outreach study. And we proved that you can do it operationally with more traditional auto CAR-T. But nonetheless, for a practice like mine, where we have to -- there's just a lot of commercial barriers and those commercial barriers are real. And -- and unfortunately, that limits a lot of CAR-T options really to university medical centers or centers that may have already had existing cellular therapy programs to that auto transplant or allow transplant -- and that's really the minority. 80% of cancer patients in the U.S. receive their care in the community setting. And so I think it's really essential that we're able to deliver therapy in those settings where patients are being treated.

What are your thoughts on the safety and tolerability profile that we've seen so far?

I think it's impressive. And of course, I hope it holds. I wouldn't necessarily call it surprising. And I guess my thought of that is the setting in which you treat a patient -- now I'm switching from geographic to actual clinical setting the circumstances where a patient gets treated is significant to their side effect profile. When a patient under traditional auto CAR-T, when we're waiting for disease progression, oftentimes, these patients just because their disease are acutely ill, relapsed large cell lymphoma is a disease, where patients really, their life hangs in the balance and differences of days or weeks can make a significant difference. It's not unusual for a patient with relapsed disease to really struggle to even get to their auto CAR-T infusion because their disease may be so rapid or causing symptoms. And and then introducing a CAR-T into that very unstable clinical situation really is dangerous because the sort of antigen drive, if you will, of the or I should say, the abundance of disease in that setting really drives an exuberant proliferation of the auto CAR-T and that then what leads to the cytokine release syndrome and potential ICANS. And so when you treat somebody whose disease is much more controlled, it's much easier to do. And I've certainly observed that clinically in many patients who I've referred for CAR-T in the past, those with better controlled disease get through the procedure much more easily. And so taking somebody whose disease is restricted to the presence of MRD positivity, if somebody whose disease is frankly, quite well controlled. And I think the statistics you gave or that you presented was that 75% of these patients were PET negative. And so these are patients with comparatively modest burden of disease. And the consequence of that is that they really don't have the same overwhelming autologous cellular proliferation. This is something that occurs under a much more controlled circumstances. And so I guess you asked what's my impression, and I would say I'm pleased, but I'm not surprised, and that's the basis by which I formed that opinion.

Great. So how might these early safety and efficacy data, if they bear out in the overall study, change how you think about offering CAR-T to your patients -- and how do you think it might change to other patients and other community-based practices?

Look, if this proves positive, it fundamentally changes the way we treat large cell lymphoma without a doubt. The idea of consolidation therapy is not new to oncology. We do it in acute myelogenous leukemia. We do it in other hematologic malignancies. So that concept is not foreign to the field. It's just not something done in large cell lymphoma currently. But look, there's an unmet medical need in large cell lymphoma, which is that week you're about 2/3 of patients with frontline therapy. That leaves 1/3 that's not. And if we have to wait until they relapse, that's what limits the efficacy of auto CAR-T is that you're pushed for all the sort of clinical social variables I outlined above. On the other hand, if you finish therapy, we're all used to getting tests, we get -- currently, we get PET scans, but if that just means it shifts to get -- if that means it just shifts for us to get MRD. Well, then we'll get MRD. And if they're MRD positive, that gives us a very actionable step, which would be to proceed with Allo CAR-T in the situation. And I imagine we'll probably talk about it, but my experience with the therapeutic administration of the product was really quite easy.

So I mean, with that kind of thought, how do you see the ability to integrate something like this an off-the-shelf product into your busy community practice?

Well, listen, I think I'll just sort of say my experience treating a patient on the study was very simple. The lymphodepletion chemotherapy was fludarabine, cyclophosphamide, and I do have enough gray hairs to say that, that's used to be how we treated patients with CLL all the time. That was a standard regimen for the management of chronic lymphocytic leukemia. And not hard to administer. It's really quite simple. And then the cellular product was also really simple. It just came in a [ door ] and just had to be thought out and administered. And my own infusion room, I think a number of people kind of gathered ground to see this because it seems so cool to to you, but it was really kind of anticlimatic. We just sort of infused the cells and patient was done and went home and then we sort of checked on him regularly several days, the protocol had several protocol mandated visits and sort of nothing exciting ever happened. And to my own patients, when I refer to them as boring, that's sort of the highest praise I can give them because really, you want to be boring in an oncology clinic, you never want to have drama and this was very boring, which was ideal.

Well, for one, I'm good with boring when it comes to side effects. So that's awesome. Okay. Finally, what are your thoughts on how MRD could be used in everyday care of patients with...

I think Foresight's product really looks quite provocat effective or I'm not sure what the right word is, it's really good at identifying those patients who are likely to progress versus not. I mean again, I come back to the notion that 75% of these patients were were pet negative, yet they were MRD positive, and I think that really speaks to the limitations of PET scan, if there's a better test out there, we'll use it and particularly if there's a use case for it, right? So I think that sometimes diagnostics struggle a little bit when there's not sort of an action item on the other end of it, meaning if we get a test and it's purely for prognostic purposes or so forth. Sometimes those are more difficult test to get. But if there's a obvious thing for us to do afterwards, which would be CAR-T then it's much easier for us to justify getting that. And so I think MRD -- the company who bought Foresight Natera they are a very good company. I think a lot of oncology practices are comfortable and familiar with using them -- they have a lot of products in solid tumors already. And so there's they're a good partner for us to work with. And I think that they will help deploy this assay in an effective way as well. So look, I think all the pieces kind of line up right for this. And congratulations to you guys for having some really interesting early data and setting up a clinical study that I think operationally mirrors how the product could be used in the real world.

Okay. Great. Well, I'm going to let you take a break and grab a cup of coffee because we'll have Q&A here in a little bit. Thank you so much, Dr. Sharman, for your sharing your thoughts here.

You bet Thanks.

As we look ahead, Slide 20 outlines the next milestones for the trial. Alpha 3 is expected to complete enrollment by the end of 2027. And -- we anticipate an interim EFS analysis in mid-2027, followed by the primary EFS analysis in mid-2028. We -- these future readouts will ultimately determine whether the MRD clearance observed here translates into meaningful improvements in clinical outcomes. As we summarize the data presented on Slide 21, we are very pleased with the results that are emerging for Semacel part of first-line consolidation treatment for LBCL. From a patient perspective, we believe the key takeaway is straightforward a 58.3% MRD clearance rate with Semacel treatment over half of patients versus 16.7% with observation. While early and based on a small sample, these data provide initial support for the potential of Semacel to intervene in high-risk patients before clinical relapse. Combined with a favorable interim safety profile and the potential to deliver in outpatient and community settings, we believe this supports a fundamentally different CAR-T paradigm, 1 that could expand access enable earlier use and position allogeneic therapy as a scalable go-to option. I'll now turn the call over to Christine to discuss recent market research that highlights the potential opportunity for Semacel.

Thank you, Zach, and Dr. Sharman. And frankly, a lot of what I'm going to be talking about, Dr. Sherman's already kind of illustrated. So before discussing where the field is going, it's important to start with where CAR-T stands today, as shown on Slide 23. Despite strong clinical efficacy, current CAR-T access remains highly constrained, only about 15% of eligible second-line patients receive treatment driven by structural limitations and concentration in roughly 200 academic centers. However, we think -- we know about approximately 80% of first-line patients are treated in the community where autologous CAR-T is not readily available. These barriers are well documented. For example, a recent article in target oncology and featuring an MD Anderson KOL who highlighted key challenges with itelligence CAR-T and LBCL related to referral patterns, infrastructure and access. These challenges are exactly what Alpha 3 and Semacel are designed to address. On Slide 24, we shift to what we believe could ultimately drive adoption as Semacel is approved. We conducted market research with approximately 30 physicians across academic and community settings, evaluating 3 blinded target product profiles or TPPs, representing emerging regimens, an autologous Card and advice specific and first-line induction and Semicel first line consolidation. For Semacel, the TPP assumed a 50% MRD clearance rate with no Grade 3 CRS or ICANS and low rates of Grade 3 or greater infections, all of which is somewhat conservative relative to our data today. In this market research, autologous CAR-T was recognized for its efficacy, but physicians noted logistical complexity where it's currently used manufacturing constraints and a safety profile that may limit earlier line use when used in first-line regimen which has demonstrated a strong benefit risk profile. For bispecifics, physicians acknowledge that they may offer greater accessibility and ease of administration, the questions remain around durability, continuous dosing, safety and overall treatment burden. The semacel TPP was differentiated by its MRD guided first-line consolidation approach as a onetime targeted treatment only for patients commuted all while addressing the 5 dimensions David discussed earlier, efficacy, safety, speed, simplicity and scalability. The feedback was clear. Physicians are no longer evaluating CAR-T on efficacy alone, adoption in earlier lines requires confidence in outcomes and safety that allows for deliverability outside the hospital. Access through off-the-shelf availability and simplified logistics, including biologic like reimbursement without fast accreditation. This alliance with what was conveyed by Dr. Bartlett and Dr. Sharman in our press release and from Dr. Sharman's comments today on the call. efficacy is required that safety and deliverability could ultimately unlock us. particularly in earlier lines and in the community setting. On Slide 25, we've highlighted what we heard in research, which is consistent with some of the questions were asked by investors for some physicians in this research, perceptions of current CAR-T were anchored in a legacy framework shaped by experience with autologous therapies or by lack of knowledge of prior semicell data. We heard consistent legacy perceptions waiting until relapse, which is the current standard of care, reserving CAR-T for later lines, viewing it as limited to academic centers and questioning its role alongside emerging first-line alternatives. Recall earlier the TPPs reflecting potential first-line induction profile for autologous CAR-Ts with strong efficacy for constrained logistics, where it fits in the treatment paradigm, manufacturing and safety, while bispecifics offer accessibility and ease of use that face uncertainties around durability, continuous dosing, safety and overall treatment burden. When presented with the Semacell TPP, it became clear that these perceptions could become outdated and that Semicel could address these perceived barriers. Slide 26 starts at the beginning of this process with MRD testing. Today, MRD testing is used about 20% to 30%, primarily in academic settings. When paired with the potential product like the provided TPP for Semicel physicians projected that use could increase to 75% to 80% as it could create a clear point of action at the end of first-line therapy. This is especially notable as we consider future uptake with Natera's acquisition of Foresight reinforcing the commercialization of this assay is well positioned for success. Compelled by the Semicel TPP, physicians projected that approximately 50% to 70% of MRD-positive patients would be treated in first-line consolidation. We believe these responses suggest a new decision point at the end of first-line treatment that fundamentally changes how CAR-T could be used. Slide 27 builds on a framework we've previously shared and highlights a key dynamic in real-world settings, approximately 30% of patients, who achieve a response after first-line therapy will ultimately relapse. While Alpha 3 enrolls patients who are MRD-positive immediately at the end of first-line treatment, physicians in our research noted that in practice, serial MRD testing following first-line therapy could be used to identify patients at high risk of relapse beyond a single time point. Today, any high-risk patient is managed with the watch and wait standard of care. Alpha 3 challenges that current standard of care with Semacel, which has been designed for real-world use that combines earlier intervention, broader access and biologic scale delivery, allowing it to potentially leapfrog the competition. Slide 28 translates our perspective on the Semacel TPP and market research into a quantified opportunity. Across the U.S. and EU5, this represents more than 14,000 addressable patients annually and an estimated $5 billion market opportunity for first-line consolidation alone. Within this, Semicel's share of the market could represent $2.5 billion to $3.5 billion based on projected physician utilization, MRD testing rates and expected treatment patterns. Slide 29 shows how Semacel could fundamentally change the future market for CAR-T. Today, CAR-T adoption is constrained by access infrastructure and delivery limitations. We believe Alpha 3 has the potential to change that. In LBCL the projections for autologous CAR-T represent a roughly $3.5 billion market in 2032. The -- with first-line consolidation, this could increase to approximately $7 billion, more than doubling the category and moving beyond simply a shift in the market share to true market expansion. I'll now briefly turn it back to David before we begin our Q&A portion of the call.

Thank you, Christine. Importantly, for patients what we have discussed today is about access to innovation and the possibility of earlier intervention to potentially prevent relapse and improve long-term outcomes. We believe Semacel pending a successful outcome of the ALPHA 3 study and approval has the potential to deliver across the 5 dimensions required to MLA CAR-T. Efficacy, safety, speed, simplicity and scalability. We believe this combination could enable a fundamental shift in how CAR-Ts used translating into meaningful market expansion and a multibillion-dollar opportunity. We have potential -- we are positioned to execute with a wholly-owned U.S. manufacturing facility built to support demand at scale. Taken together, we believe the interim data presented today position Semacel as a potential inflection point for CAR-T, supporting a shift from a complex capacity-constrained intervention to a scalable broadly deployable platform that can reach patients earlier in their disease. We will now open the call for questions.

[Operator Instructions] Our first question comes from Salveen Richter with Goldman Sachs.

Congratulations on the data here. You touched on this before, but could you just speak to how the interim futility will translate to the primary EFS endpoint? And then Help us understand the registrational strategy here in terms of whether you could file on the interim EFS analysis in mid-27?

Salveen thanks for those great questions. In terms of looking at the MRD clearance, there are a number of emerging data points that clearly indicates MRD clearance after the treatment strongly correlates with the clinical outcome that reduction in the EFS that we have outlined, that's also associated with the reduction in PFS and in some cases, even the overall survival has been associated with the MRD clearance. So I think we still have to show the correlation between MRD clearance and clinical outcome within ARPA 3 study. However, the existing data are very compelling. On the second question about the regular strategy, it's a little bit premature for us to go in depth. But what you're referring to is our planned interim EFS analysis in mid-2027. Like any other interim EFS analysis of primary endpoint analysis the intent of the interim analysis to change the course of the study, conducted the study in the event of overwhelming efficacy. And appropriately, we have set a so-called ARPA. This is how the statiticians use stability of the testing, we have set the bar relatively high appropriate for what we are trying to do. However, if we are forced to enough to cross the statistical boundary at the interim EFS analysis, -- and when -- if our independent data monitoring committee recommended we will take the appropriate action to accelerate the regulatory discussion with FDA and potentially leading to the BLA submission. We believe that is the right thing to do for the patients.

Our next question comes from Tyler Van Buren with TD Cowen.

Thank you for the thoughtful presentation and congratulations on the sandwich of both the stellar efficacy and safety data. Maybe 1 for Dr. Sherman and 1 for management. For Dr. Sharman, the value proposition here seems so obvious, at least to me. So -- but it would be great to hear you walk us through how you present the opportunity for Semacel treatment to patients when discussing potential enrollment in the ARPA 3 study or eventually in practice following the alternative post the frontline treatment? And how might these data change the conversation with patients? And for management just on MRD clearance. I know you said obviously a great result. And I know you said it was rapid, but are there any additional details you can provide around the time course of the MRD clearance, for example, how many achieved it with the first assessment versus later assessments.

I'll go first since the question was to me first, and then I'll hand it over to the Allogene team. The discussion is actually pretty easy. When somebody is coming to the end of therapy, there's a very natural interest on the part of the patient to know how well they've done patients are like so I'm cured where am I -- and with our PET scans, we can say, hey, look, you have a pet negative result or sometimes there are PET findings where there's a very equivocal finding and maybe the D-ville score isn't low enough, but it's not an easy place to biopsy and so forth. And really, the only thing we have to offer our patients is the test of time to say let's see how this goes over time and the longer you go without relapse, the more likely you are cured. In terms of MRD testing, the patients are pretty enthusiastic about it because what we're able to say to them instead is, hey, we think we have a better predictive test than PET scan. We have a just the blood draw that we can follow patients preferred blood draws to scans, scans have radiation and PET scans are cumbersome. So the testing is not much of an issue. You asked a second question though, which was how is this data likely going to affect the conduct of the trial moving forward. I will tell you it might make it a little bit more difficult as there's I think the hardest part of the discussion is the patient who's MRD-positive, who gets randomized to the observation arm. And I think the current standard of care is observation, and that's what this trial is trying to displace. But I think for the MRD-positive patient who is randomized to observation, there's understandably apprehension that the disease is going to come back and what that means for them. So overall, I think that the testing and the therapeutic administration here, I think, is relatively straightforward. And you said that the value proposition is obvious. I agree with you.

And Tyler, I'll take the second question. This is Zach. So because this is an ongoing trial, obviously, we don't intend to provide any more detail on the timing of MRD clearance of individual patients -- but I will say that the most important thing, according to all the existing literature that David covered is that you achieved MRD negativity at any point following treatment. And so that is what we shared with you all.

Our next question comes from Samantha Semenkow with Citi.

Let me add my congratulations on the really excellent data presented this morning. One for Dr. Sharma. I'm just wondering, as you're thinking about integrating this into your practice if it were to be approved with a similar profile that we're seeing today, how many of your patients end up ready positive, would you offer this to? And what proportion do you think would actually end up receiving Semacel in an ideal world data-wise?

Yes. Let me just make sure I understand the question. The question, as I understood, it was how many patients who are MRD-positive would you subsequently treat? Is that accurate?

Yes, exactly.

Yes. I think most of them, almost all of them, right? I'm sort of trying to think of a circumstance where I wouldn't treat them. I think that in large cell lymphoma, there is kind of a frailty consideration and a burden of treatment consideration. So some patients as they finish up therapy for large cell lymphoma have had a number of complications. I can think of a patient I took care of recently, who had 3 or 4 admissions for Fabron neutropenia, -- he ended up with a colectomy because he had terrible cluster him difficile, and he really linked through the finish line. And even though he was young -- he was a patient that didn't offer testing for because the idea of additional therapy in that situation seemed like it would be too much for for him in that setting. But I'll tell you, I think that's a significant minority of patients. Most patients get through therapy it's hard therapy, but they want to know that it's worth something. So I think the question is maybe a little bit different, which is, are there patients that wouldn't test -- and yes, there probably are some. Maybe that number is 10%. It's the high octogenarian large cell lymphoma patients, who we had to do a lot of dose reductions to get them through therapy or the patients who have the significant burden of therapy. Those patients do exist, but those are ones where I probably just simply might not test them -- or if I did test them and they turned up positive, maybe it just kind of influences how I follow them up. So I'm sure there are some. I'm trying to think through the question and sort of clinical practicalities as I'm giving an answer at the same time. So I would acknowledge that there probably are some but I don't think it's a huge number.

Our next question comes from Michael Yee with UBS.

Good morning. We have 2 questions. One was to the company around the confidential agreement with FDA around the primary endpoint on and thinking about perhaps positive around the understanding of MRD negativity as it relates to myeloma now and to others. But obviously, here within CAR-T specifically therapeutically and with the end point, what discussions you've had with the agency around that endpoint. And then the second question is for the doctor. I know that you said overwhelmingly, the majority of patients you would seek to treat with that. Can you speak to your comfort around this particularly as an outpatient therapy and to what degree because you are, as you said, not in Portland, the degree that you can just treat and then send people home? Or how do you think about that logistically? Is that really a key part here?

Michael, this is a Chang. Let me take the first question, and I'm going to make my answer brief, given that we have about 8 minutes left. In terms of the FDA and EFS as an end point, first of all, this is an established endpoint in the second-line setting, and there is ample precedent for using EFS as a primary endpoint. And we have a full agreement with FDA that this is an appropriate endpoint for the study.

And I think I can be brief similarly about my question about outpatient treatment. -- it's all going to boil down to how the data looks in the final presentation of safety and efficacy, but really safety more than anything else. I think that's where regulatory agencies are going to weigh in on this. I guess I'd refer back to my original comments about the clinical state in which the patient is treated. So if they have a disease that's out of control and clinically progressing the likelihood of side effects in that environment just seem to be a lot higher than treating in the sort of low burden MRD positive status. So we already do a lot of things in the outpatient setting bispecific antibodies and CAR-T, when we do the 1 study, we did it as an outpatient -- provided a patient could stay outpatient I don't think it's going to be a huge issue. I think that the bigger challenges will just have to do with maybe some of the way the commercial agreements are set up with practicing sites and how the drug is acquired making sure that it can be reimbursed, but actually doing the treatment in the outpatient setting doesn't doesn't seem terribly concerning.

Our next question comes from Kyle Breese with Piper Sandler.

This is Kelly Breeze on for Biren. Maybe the first question was, can you just walk us through how many events do you need for the interim and the final EFS analysis and the confidence level on the endpoint for both events -- and then I was wondering if you could also -- given these data, would you expect interest in the trial to increase? And how does that impact your enrollment time lines for the Alpha 3 study.

Yes. Let me take the first question, and I'll ask Zach to respond to the second question. In terms of the statistical parameters, I mean these are information that there are many different dimensions. And generally, we will be sort of keeping the statistical parameters for the study relatively to ourselves, and we will share them at a relevant time point. Thanks, Kelley. We -- for the projections that we pointed out, completing enrollment by the end of 2027, we have not baked in any boost to enrollment that might come from these early results. However, -- we do think that there may be an impact. And certainly, I think that as the first data shown that shows the value of consolidation with an off-the-shelf CAR T, it may generate more interest both by physicians as well as by patients.

Our next question comes from Matthew Phipps with William Blair.

Let me offer my congrats as well on some great initial results here. I was wondering, again, a question on the EFS guidance to advent time lines. I was wondering if that assumption that you all made to get to the interim mid next year is based off the 50% risk reduction that you assumed in powering the trial. And if you think that might need to be adjusted just given the magnitude of separation you're seeing already in clearance rates and how that could impact the accrual events?

Matthew, a very interesting question. This is a topic that we are constantly sort of discussing internally. Just to be clear, this is a potentially registration study to preserve the trial integrity. We don't look at the clinical endpoints while the study is ongoing, clinical endpoints, meaning event-free survival or progression-free survival. So at that time will come appropriately on the planned analysis.

Our next question comes from Roger Song with Jefferies.

Great. Congrats for the result outstanding. So understanding you haven't given us too much kinetics of them or the -- which is understandable. Just how -- how do you expect the MRD negativity this delta will change over time? And then do you plan to take another account MRD before the EFS with a little larger sample size?

Thanks, Roger. Of course, the potential for that MRD clearance rate to change and improve over time exists. As I said, we -- this is just a snapshot of the MRD status at the last check, but there may be additional patients who eventually convert However, we -- in terms of checking the MRD status, again, that is not something we intend to do. This was really as the protocol was defined to do this interim futility check. And the next time that we will be looking at data will be at the protocol specified interim analysis.

Our next question comes from Matthew Biegler with OpCo.

Maybe a follow-up on the kinetics here. to the extent you can answer it. But are you seeing any correlation between MRD responses and CAR-T expansion in the blood or if you might not even expect to, given the lack of CRS and ICA that we're seeing any thoughts there?

Thanks, Matt. I think it's all of the additional correlative data and so forth, we'll have to wait for a future data presentation.

Due to time, we will now conclude the question-and-answer session. I'd like to turn the conference call back over to management for any additional comments.

All right. Thank you. data shared today from the interatrial analysis increases our conviction that Semecell has the potential to change perceptions of allogeneic cell therapy, change how CAR-T is used and ultimately change the disease trajectory for patients. We look forward to advancing ARPA 3 and delivering on that potential. Thank you.

Thank you. Ladies and gentlemen, thank you for your participation in today's conference call. This does conclude the program, and you may now log off and disconnect.