Allogene Therapeutics - Earnings Call - Q4 2024

Executive Summary

• Q4 2024 delivered disciplined execution and clear 2025 catalysts: ALPHA3 lymphodepletion selection/futility around mid-2025, ALLO-316 Phase 1b durability data mid-2025, and ALLO-329 autoimmune basket trial proof-of-concept by year-end 2025.
• Financials: net loss of $59.9M and EPS of $0.28 loss; cash and investments ended at $373.1M; sequential cash burn accelerated consistent with R&D progress.
• 2025 guidance introduced: cash decrease of ~$170M and GAAP operating expenses of ~$250M (incl. ~$50M SBC); cash runway remains into 2H 2026—maintained from prior quarters.
• Strategic progress: 40 ALPHA3 sites activated; expanded Foresight MRD companion diagnostic partnership ex-U.S.; ALLO-316 holds RMAT designation and completed Phase 1b expansion cohort enrollment—setting up near-term data readouts.
• Street estimates (S&P Global) were unavailable; beat/miss assessment cannot be made. Values would be retrieved from S&P Global; unavailable this period.

What Went Well and What Went Wrong

What Went Well

• “We believe 2025 will be the year allogeneic CAR T broadly begins to demonstrate its potential to surpass autologous CAR T therapy” — pipeline positioned for three major clinical readouts (ALPHA3, ALLO-316, ALLO-329).
• ALPHA3 momentum: ~40 sites activated; pivotal design with MRD-based selection aims to improve event-free survival in 1L LBCL; futility and lymphodepletion selection around mid-2025.
• ALLO-316 progress: RMAT designation in RCC; Phase 1b expansion enrollment completed; prior Phase 1 showed 50% best ORR and 33% confirmed ORR in high CD70 TPS cohort with manageable safety.

What Went Wrong

• Continued operating losses with no product revenue: Q4 net loss $59.9M and EPS loss of $0.28; collaboration revenue at $0; ongoing cash burn trend.
• Impairment charges persisted across 2024 (non-cash): $15.7M for the year; Q3 also recorded $10.7M; highlights asset rationalization amid pipeline focus.
• Estimates context unavailable (S&P Global retrieval error), limiting beat/miss evaluation and potentially delaying investor consensus recalibration; management did not provide revenue or EPS guidance. Values would be retrieved from S&P Global; unavailable this period.

Transcript

Operator (participant)

Hello. Thank you for standing by, and welcome to Allogene Therapeutics' Fourth Quarter and Full Year 2024 Conference Call. After the speaker's presentation, there will be a Q&A session. To ask a question, please press *11 on your telephone and wait for your name to be announced. To withdraw your question, please press *11 again. Please be aware that today's conference call is being recorded. I would like to turn the call over to Christine Cassiano, Chief Corporate Affairs and Brand Strategy Officer. Ms. Cassiano, please go ahead.

Christine Cassiano (EVP, Chief Corporate Affairs, and Brand Strategy Officer)

Thank you, Operator, and thanks to all of you for joining this call. After the market closed, Allogene issued a press release that provided a business update and financial results for the fourth quarter and full year of 2024. This press release and today's webcast are available on our website. Following our prepared remarks, we will host a Q&A session. We recognize that historically, questions have been multifaceted, but note that we will endeavor to keep this call to under an hour. I'm joined today by Dr. David Chang, President and Chief Executive Officer, Dr. Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, and Geoff Parker, Chief Financial Officer.

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.

David Chang (President, CEO, and Co-Founder)

Thank you and welcome, everyone. It's a pleasure to be speaking with you today. At the start of 2024, we set forth a bold strategy that some viewed as merely words on PowerPoint with a distant horizon. A year later, we stand on the brink of a transformative year at Allogene. Pioneering allogeneic CAR T therapy was never expected to be easy. It demands vision, rigorous science, relentless persistence, and operational excellence. Today, all three of our key programs are approaching critical milestones marking the tangible progress of our dedication. We enter 2025 stronger than ever, with a differentiated pipeline and a clear path to shaping the future of allogeneic CAR T.

Our programs in large B-cell lymphoma, autoimmune disease, and renal cell carcinoma are breaking new ground, reinforcing our commitment to making off-the-shelf cell therapy a new standard of care. Our pivotal phase II ALPHA3 trial for cema-cel in first-line consolidation large B-cell lymphoma is widely considered to be groundbreaking. We are immensely proud of the innovation behind this trial. The enthusiasm from both community cancer centers and leading academic institutions has been truly energizing, and momentum continues to build with 40 sites now activated.

We anticipate reaching a critical milestone with the lymphodepletion selection and futility analysis around mid-2025. This interim analysis will provide essential insight into whether our approach is on track to meet its objectives, providing a clear signal of progress when we select our lymphodepletion regimen. Beyond oncology, 2024 also marks our official expansion into autoimmune disease with ALLO-329, the first of its kind, CD19/CD70 dual-targeting allogeneic CAR T product candidate, powered by our proprietary Dagger technology.

Earlier this year, we secured FDA clearance for our phase I RESOLUTION basket trial in rheumatology, an important step towards delivering a scalable off-the-shelf CAR T option to the vast number of patients who stand to benefit. The IND clearance for ALLO-329 cements Allogene as a true innovator in the autoimmune disease space. We did not follow the crowd. We deliberately took the time to ensure our approach was differentiated, developing both an investigational product and trial specifically to address the unique challenges of autoimmune disease. ALLO-329 is designed to induce lasting remission by targeting both B-cells and activated T-cells.

An equally important design feature is incorporation of our Dagger technology, which has the potential to reduce or even eliminate the need for lymphodepletion. If successful, this breakthrough could fundamentally change how CAR T therapy is deployed in autoimmune diseases. With the RESOLUTION trial slated to launch in mid-2025 and proof of concept data expected by year-end, we believe ALLO-329 represents a new frontier in allogeneic cell therapy that will showcase the power of our platform to redefine treatment paradigms beyond oncology.

In solid tumors, ALLO-316 is emerging as a promising and potentially groundbreaking asset in renal cell carcinoma. The phase I data we presented last year underscores the potential of allogeneic CAR T therapy to drive meaningful responses in solid tumors, an area where cell therapies have historically faced immense challenges. With our Regenerative Medicine Advanced Therapy designation, ALLO-316 has the potential to redefine treatment for advanced renal cell carcinoma, bringing a much-needed innovation to patients with limited options. In mid-2025, we plan to share an update from our phase Ib cohort focusing on durability, a key factor in improving long-term patient outcome.

From a broader perspective, the momentum across our programs highlights the potential of allogeneic CAR T therapy to disrupt multiple disease areas. We aim to not just compete with autologous therapies. We are demonstrating that Allogene approaches can surpass them in accessibility and scalability. Our bold pivot in 2024, coupled with our relentless execution, affirms that we have the right team, science, and strategy to make 2025 a breakthrough year for Allogene, one that defines the future of allogeneic CAR T therapy. I would like to now hand the call over to Zach to provide further details on our clinical programs.

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Thank you, David. We take great pride in our clinical progress across our R&D organization and the company as a whole. All three of our cutting-edge programs demonstrate significant promise, reinforcing the strength of our science and execution. We are energized by the momentum in our pivotal cema-cel trial in first-line consolidation LBCL, the upcoming launch of the RESOLUTION basket trial with ALLO-329 in rheumatology, and the compelling data emerging from ALLO-316 in advanced renal cell carcinoma. Let's start with the foundation of our programs.

The field has questioned for years whether an allogeneic CAR T could deliver durable responses. With multiple patients with relapsed refractory LBCL and ongoing complete remissions beyond four years, we now have proof that our products can achieve that. The Journal of Clinical Oncology's recent publication of our phase I ALPHA/ALPHA2 trial results in relapsed refractory large B-cell lymphoma marks a defining moment for the field. These findings represent the most comprehensive allogeneic CAR T dataset to date. The study showed efficacy comparable to approved autologous CAR Ts, with an overall response rate of 58% and a complete response rate of 42% across the study, increasing to 67% and 58% respectively with the pivotal study regimen.

Importantly, treatment delivered exceptional durability with a median duration of response of 23.1 months and median overall survival not reached in patients who attained CR. We also observed a potentially best-in-class safety profile with no cases of graft versus host disease, immune effector cell-associated neurotoxicity syndrome, or high-grade cytokine release syndrome. The median time to treatment was just two days, significantly shorter than the weeks-long wait times required for autologous CAR T. Moreover, these results provide compelling evidence supporting the use of CAR T therapy in patients with low disease burden.

A growing body of research indicates that earlier intervention with CAR T, when the disease burden is minimal, can lead to improved safety and efficacy outcomes, and this study reinforces that premise. Among patients with baseline tumor burden of less than 1,000 millimeters squared or normal LDH levels, a key biomarker of low disease activity, the complete response rates were 100% and 82% respectively. These findings strongly support cema-cel as a breakthrough therapeutic option for patients with minimal residual disease, which is the population studied in ALPHA3, the first randomized trial evaluating CAR T as first-line consolidation therapy for MRD-positive patients.

With cema-cel's 100% CR rate in patients with low but still radiographically evident disease burden in these earlier trials, ALPHA3 presents an unprecedented opportunity to both predict relapse and intervene before it occurs. If successful, ALPHA3 stands to upend the standard of care in first-line LBCL, potentially marking the first significant advance to the treatment paradigm in the last 25 years. Since the trial's launch in June, we have made steady progress. Today, we have successfully activated 40 of the planned approximately 50 sites, with roughly a 50/50 split between community cancer centers and academia, and we are progressing towards the first key milestone in ALPHA3 trial, the lymphodepletion regimen selection anticipated around mid-2025.

Beyond signaling progress in accrual, the lymphodepletion selection step is paired with a futility analysis, and thus our decision to proceed will be a critical indicator that the trial is on track to meet its objectives based on early data. Moreover, this milestone will help map the registrational path forward, further solidifying our confidence in cema-cel's potential to redefine the standard of care. Due to the seamless pivotal design, these early patients' results count towards the pivotal analysis, and therefore, we will not be releasing detailed efficacy or safety outcomes to protect trial integrity.

Beyond LD selection, we plan to conduct an interim EFS analysis, which will be overseen by the Independent Data Safety Monitoring Board in the first half of 2026. The primary EFS analysis data readout is expected around year-end 2026, with a potential BLA submission in 2027. None of this would be possible without the great partnership of Foresight Diagnostics and their ultra-sensitive ctDNA-based CLARITY assay powered by PhasED-Seq. For this reason, we expanded our strategic collaboration with Foresight to support the development of their MRD assay as a companion diagnostic in the EU, U.K., Canada, and Australia to support Allogene's clinical development of cema-cel.

Shifting gears to autoimmune diseases, in January 2025, the FDA cleared the IND for the phase I RESOLUTION basket trial, a first-of-its-kind study evaluating ALLO-329 in systemic lupus erythematosus, lupus nephritis, idiopathic inflammatory myopathies, and systemic sclerosis. This true basket design brings significant operational efficiencies, allowing enrollment access to a broad patient pool with a single IRB approval. This is one of several differentiating factors that may prove advantageous in this competitive space. The strategy behind ALLO-329 stems from two key observations.

First, autologous CAR T data suggests that short-term CAR T persistence is sufficient to reset the immune system in autoimmune diseases, contrasting with the months to even years-long persistence needed in oncology. Since B-cell depletion lasts around 100 days in autologous studies, allogeneic CAR T's natural two to four-month persistence makes it uniquely suited for autoimmune therapy. Second, data from our phase I ALLO-316 program in kidney cancer demonstrated that our Dagger technology intrinsically enhances cell expansion and persistence, allowing us to significantly reduce the intensity of lymphodepletion without sacrificing efficacy.

These insights shaped ALLO-329, which includes the Dagger technology and is intended to enable reduction or even elimination of lymphodepletion, a major differentiator in autoimmune treatment. The RESOLUTION trial will immediately test the requirement for lymphodepletion in parallel cell dose escalation pathways. In one, we will use a single infusion of cyclophosphamide at a dose used in rheumatology, and in the other, a CAR T-only arm with no lymphodepletion relying entirely on the Dagger effect. This trial is set to launch mid-year with proof of concept data expected around year-end. With extensive preclinical validation, published data, and an optimized design, ALLO-329 is positioned to be the most rigorously designed allogeneic CAR T program for autoimmune disease to date.

Beyond rheumatology, its potential extends to nephrology, neurology, hematology, and even inflammatory bowel disease, paving the way for a new era of CAR T therapy in immune-driven conditions. Last quarter, I highlighted ALLO-316 and its remarkable potential following data that showcased encouraging responses from a single infusion with an impressive 50% best overall response rate and a 33% confirmed response rate in heavily pretreated metastatic kidney cancer patients whose tumors expressed high levels of CD70.

Given that update, I'll keep it brief today with just a reminder of the next steps for this promising program. We have completed enrollment in the phase Ib expansion cohort, which is assessing safety, efficacy, and durability of ALLO-316 at dose level 2 or 80 million CAR T cells following standard lymphodepletion with fludarabine and cyclophosphamide. As we continue to evaluate outcomes, we will determine the best path forward, including the potential to pursue a strategic partnership. We expect to share data from this cohort in mid-2025. I'll now turn the call over to Geoff.

Geoffrey Parker (EVP and CFO)

Thank you, Zach. I'll focus my remarks on our financials. Our financial position is strong, and we continue to operate with capital discipline, ensuring we are well-positioned to advance our pipeline and pursue our strategic objectives. As of December 31, 2024, we had $373.1 million in cash, cash equivalents, and investments, with our cash runway extending into the second half of 2026. Research and development expenses for Q4 2024 were $45 million, including $5.6 million in non-cash stock-based compensation expense.

For the full year of 2024, R&D expenses totaled $192.3 million, including $20.4 million in non-cash stock-based compensation. General and administrative expenses for Q4 2024 were $15.5 million, including $7.3 million in non-cash stock-based compensation. For the full year, G&A expenses were $65.2 million, including $31.3 million in non-cash stock-based compensation. Net loss for Q4 2024 was $59.9 million or $0.28 per share, including $12.9 million in non-cash stock-based compensation.

For the full year, net loss was $257.6 million or $1.32 per share, including $51.7 million in non-cash stock-based compensation and $15.7 million in non-cash impairment of long-lived asset expense. Turning to guidance for 2025, we expect a cash burn of approximately $170 million. We expect full year 2025 GAAP operating expenses to be approximately $250 million, which includes an estimated non-cash stock-based compensation expense of approximately $50 million. This guidance excludes any impact from potential business development activities. We'll now open the call for questions.

Operator (participant)

Thank you. As a reminder, to ask a question, please press *11 on your telephone and wait for your name to be announced. To withdraw your question, please press *11 again. One moment for questions. Our first question comes from Tyler Van Buren with TD Cowen. You may proceed.

Tyler Van Buren (Managing Director and Senior Biotech Equity Research Analyst)

Hey, guys. Thanks very much and congratulations on all the progress. My question was just following up on the recent JCO publication that you highlighted and thinking about the read-through as to the ongoing ALPHA3 trial. How do patients with low disease burden in the publication compare to those being enrolled in ALPHA3 as we think about the high complete response rate holding up in ALPHA3?

David Chang (President, CEO, and Co-Founder)

Hi, Tyler. Excellent question. I think one thing that we highlighted in our JCO paper, and this is, in fact, something that we have been saying for some time based on what has been seen in autologous CAR T therapies. When you look across patients who have been treated with CAR T, I think this extends not just CD19, but with other BCMA or other antigen-targeted CAR T and heme malignancies. There is a very strong correlation of likelihood of response as well as likelihood of experiencing adverse events, serious adverse events. I mean, actually, it's an inverse relationship in the latter case. When the disease volume goes down, the likelihood of response is much higher.

At the same time, the probability of having a serious adverse event goes down. That has been seen numerous times, and there are many publications on that. Essentially, in the JCO paper, we were showing that essentially the same holds true for the allogeneic CAR T. Probably not that surprising. I think this really bodes well for what we are doing, not only in the ALPHA3 study, but also as we think forward into the autoimmune program with ALLO-329.

Specifically about your question, in terms of estimating the disease volume of MRD compared to patients who are studying the front-line study—I'm sorry, second-line study—there is some information that we have done together with Foresight Diagnostics. MRD positivity is about 200-fold less disease volume than patients who are presenting with disease for the start of the second-line treatment. Your particular question about how that compares with the low volume, the two categories of low disease volume that we have published in JCO, LBCL or the tumor measurement, I would more or less extrapolate to about the same degree of lower disease volume as we have previously reported together with Foresight in the second-line setting versus MRD positive.

Operator (participant)

Thank you. Our next question comes from Michael Yee with Jefferies. You may proceed.

Michael Yee (Senior Biotechnology Analyst)

Hey, good afternoon. Congrats on all the progress. As we are thinking about the mid-2025 futility in lymphodepletion decision, I wanted to get your affirmation that you believe that 647 is extremely likely to not be needed, and that should be the general Wall Street expectation. I believe that would be a positive for a number of reasons. As we get to the first half of 2026, which would be around the corner, it does say that there is an interim DSMB efficacy analysis. What is the criteria, number of events, or is there a very high P-value bar on that? What are you expecting, or what should we expect at that interim? Thank you.

David Chang (President, CEO, and Co-Founder)

Hi, Mike. I'm going to defer your questions to Zach. Zach, can you take those two questions?

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Of course. Thanks, Mike, for the great question. Our opinion on the lymphodepletion selection is sort of agnostic. I think you raise a fair point that not needing 647 brings some attractive attributes, like it would be simpler for us. We're registering one entity instead of two. It certainly would be cheaper for us to do it that way. However, we see requiring 647 is actually potentially beneficial as well because that's part of our proprietary regimen.

It would help kind of protect our status here as the only therapy that is optional in this particular clinical setting. We have designed this clinical trial to give us a solid answer to that question. Is 647 needed in this unique clinical trial, or is it not? I think we can work with either independently. Both have upside for us. Sorry, Mike, will you repeat the second question? I forgotten that one.

Michael Yee (Senior Biotechnology Analyst)

Yeah. Yeah. Yeah. Right around the corner in 12 months or so is the interim by DSMB. What is the criteria? Is it a high bar because you do not want to spend alpha there? Obviously, investors have had great discussions with you about how the drug is clearly going to be working here. You could definitely have a chance of hitting there. Thank you.

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Yeah. Yeah. We haven't disclosed a lot of the specifics around the nature of that analysis, such as some of the specifics that you're requesting, except to say that it is a formal efficacy test where we will be testing the hypothesis with the primary endpoint of event-free survival. There will be some minimal alpha spent.

It is quite possible, just given the way this study is designed, that we could end up with a statistically significant finding there, which would, of course, allow us to initiate conversations with the FDA, begin to kind of move more briskly across the other elements that need to fall into place to launch the program in the coming months after that. We are looking forward to that analysis. In either case, whether it meets statistical significance or it doesn't, we look towards that as a very significant sort of milestone in the delivery of this program.

Michael Yee (Senior Biotechnology Analyst)

Thank you.

Operator (participant)

Thank you. Our next question comes from Salveen Richter with Goldman Sachs. You may proceed.

Mark Aleynick (Analyst)

Hey, this is Mark on for Salveen. Thanks for taking our question. For ALLO-329 and the trial starting soon in autoimmune disease, what data are you looking to show by year-end to demonstrate proof of concept? Maybe more importantly, since there are many CD19 players and also allogeneic players showing data this year, how do you think your approach is differentiated, and could your year-end data support said differentiation? Thanks.

David Chang (President, CEO, and Co-Founder)

Hi, Mark. This is Dave Chang. Let me take on that question. 329, we have cleared IND, and we expect to initiate the clinical study mid-2025. We have been guiding towards the proof of concept data towards the year-end. The number of patients that we expect to treat in 2025, because this is a dose escalation phase one study, will be somewhat limited, but it will be handful. What we are looking for is biomarker-based proof of concept.

One, do allogeneic ALLO-329, do they expand well? I think those are very important information. Second, do we achieve the B-cell depletion while also allowing some of the B-cell recovery to occur? These are some of the important information that will lead to the proof of concept. Also, in some of the patients that we treat, we expect them to have autoantibodies and the measurement of autoantibodies before and after the treatment.

That could also give a lot of insight into what the program is doing. In terms of differentiation of ALLO-329 to many other programs that are currently in the autoimmune space, I think the key is that, one, this is an allogeneic program. Two, this has the ability to not only deplete the B-cells, but also activate the T-cells, which contributes to the overall pathogenesis of autoimmune disorders. How the latter would translate, I think we will have to see the clinical data. Possibilities of being able to address the T-cells can allow us to go to indications that CD19 B-cell targeting therapies may not necessarily be sufficient. Another potential benefit of targeting T-cells is that the remission could be much longer because you are eliminating not just B-cells, but also T-cells.

Mark Aleynick (Analyst)

Awesome. Thank you.

Operator (participant)

Thank you. Our next question comes from Brian Cheng with JPMorgan. He may proceed.

Brian Cheng (Analyst)

Hey, guys. Thanks for taking our question this afternoon. David, I'm just curious if you can provide a little bit more comments around your latest thinking around incorporating potentially other milder lymphodepleting agents or even completely removing the standard fludarabine that you're using. Any color on timeline and what is really the fastest and the best way to kind of sort that out? Thank you.

David Chang (President, CEO, and Co-Founder)

Yeah. I mean, Brian, excellent question. These are the things that we hope to address in the phase one study. In the planned study, first of all, the lymphodepletion that we will be deploying is a milder lymphodepletion. We have taken out fludarabine. One cohort will be treated with cyclophosphamide alone as a lymphodepletion. A second one, we have also clarified when we announced the clearance of IND, is that in parallel, there will be a second cohort where we will be testing without any lymphodepletion. A little bit to your question as well to the previous question from Mark is really the phase one study already is built in to address the key questions about 329, whether it can achieve the objective with milder, which will be fantastic news, or even without any lymphodepletion, which will be phenomenal for this program.

Operator (participant)

Thank you. Our next question comes from Sami Corwin with William Blair. You may proceed.

Sami Corwin (Analyst)

Hey there. Congrats on making the progress this quarter. Thanks for taking my question. I was curious what increase or difference in event-free survival ALPHA3 is powered to show. I noticed in your 10-K that it said that if both treatment arms look better than the control with futility analysis, but they do not look any different than each other, that additional patients could be enrolled and analyzed. I guess what kind of difference are you looking to see between the two treatment arms? If they do look similar, would you pursue the lymphodepletion arm without 647? Thank you.

David Chang (President, CEO, and Co-Founder)

Yeah. Sami, I mean, the question about the powering of the ALPHA3 study, I mean, the primary endpoint is event-free survival. We haven't gone into the specifics about the powering of the study other than saying with the targeted about 110 patients each arm for comparison, this study is very well powered. This also goes back to the earlier question around from Mike about what could be possible at the interim analysis, which will happen early 2026. Yeah, we are spending some alpha. Obviously, we believe that there is some possibility, which may be not so small, that the statistical boundary may have crossed at the time.

Frankly, if you look at what has happened with the CAR T studies in the second-line study, whether it's the Yescarta or Breyanzi study, the sample size, number of patients that were treated in the second-line study, which was comparing CAR T with active treatment, it's around 260 to some mid-300, not so dissimilar. Those studies obviously will show the statistical significance in the mid-year. I think that is probably some good reference to think about how the ALPHA3 study may have been powered. Your second question about what we have disclosed in the 10-K, we have provided a little more guidance about how many number of patients that we'll be looking at as we start looking at the futility as well as selecting the lymphodepletion.

Here, obviously, if we don't see any difference, there are possibilities that we may want to have some more patients to see whether the difference is more significant or not. Another possibility is that at the time of reviewing about 36 patient data, that may provide sufficient information for us to make the lymphodepletion. We will get there, and this will be very much data-driven. Probably it's best that we wait till that time point rather than speculating too much.

Sami Corwin (Analyst)

Got it. Thank you.

Operator (participant)

Thank you. Our next question comes from Jack Allen with Robert W. Baird & Co. You may proceed.

Jack Allen (Senior Research Analyst)

Awesome. Thank you so much for taking the questions and congrats on the progress. I just wanted to ask about the futility analysis as well. How should we be thinking about the futility analysis as it relates to the comparison? Is it a comparison against the control arm here, or is it against some sort of hurdle rate? What metrics will you be looking at to evaluate futility? Would it be MRD conversion, response rates, or any early survival data? Thanks so much.

David Chang (President, CEO, and Co-Founder)

Yeah, Jack. Let me just take this question. We got asked about the futility question. There isn't anything unique about the futility analysis that we are doing. This is a very standard thing that many phase three studies, sometimes even phase two studies will be doing. What gets looked at in the futility analysis is really the totality of the data. You can look at the safety. Obviously, we want the safety to be tracking close to our expectation based on what we have seen in the ALPHA3 trial. There is a significant imbalance in the safety between the observation control arm versus two treatment arms. The second one is sort of the signs of efficacy. Here, we will be relying primarily on the MRD conversion rate.

Every patient who gets enrolled in the ALPHA3 study starts with MRD positive, both the control as well as the two treatment arms using different lymphodepletion. The expectation is MRD conversion will be heavily occurring, more significantly more in the treatment arm compared to the observation. That will be essentially the futility that we'll be looking for. Afterwards, once that futility has been crossed, we'll be looking at the two treatment arms, two lymphodepletion arms, to see which one is better.

Jack Allen (Senior Research Analyst)

Got it. Thanks so much for coming.

Operator (participant)

Thank you. Our next question comes from Biren Amin with Piper Sandler. You may proceed.

Biren Amin (Managing Director and Senior Research Analyst)

Yeah. Hi, guys. Thanks for taking my question. I think for the ALPHA3, your prior guide stated that patient enrollment would complete by first half of 2026. I just want to see if you're continuing to track towards that timeline. I guess the second question is, I think you mentioned that the split in the trial is 50/50 between community versus academic in terms of sites. How about the patient split? Is that 50/50 as well?

David Chang (President, CEO, and Co-Founder)

Yeah, Biren, in terms of the overall trial guidance, we are now focusing more on the data readout, which has not changed. Obviously, your particular question around the trial completion, I think we are more or less tracking around that time. Obviously, as we progress with the study, we'll provide more information. With respect to your second question, can you just repeat the second question?

Biren Amin (Managing Director and Senior Research Analyst)

Yeah. I think you mentioned, yeah, in terms of the trial split, the site split is 50/50 across the 40 sites that you've activated between community and academic.

David Chang (President, CEO, and Co-Founder)

Yes. Yes. Yes.

Biren Amin (Managing Director and Senior Research Analyst)

I want to understand if the patient split's similar as well.

David Chang (President, CEO, and Co-Founder)

Yeah. Let me pass that question to Zach to provide more details in terms of the site distribution across community versus academic centers.

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Yeah. Thanks, David. Thanks, Biren, for the question. David, yes, you're correct that it's about a 50/50 split right now with about four-fifths of the sites activated, community versus academic. As far as the patients coming in, what I can say is that we haven't seen a heavy skew in one direction or the other. I can't say it's exactly 50/50. What I can say is that we are seeing robust activity in both the community centers as well as the academic centers.

Biren Amin (Managing Director and Senior Research Analyst)

Great. Thank you.

Operator (participant)

Thank you. Our next question comes from John Newman with Canaccord Genuity. You may proceed.

John Newman (Managing Director)

Hi, guys. Thanks for taking my question. Just wondered on the initial data for 329 at year-end 2025, just curious if you know how much follow-up you might have if you would be able to look at one month or maybe three. Also, given the mechanism of action for 329, is there a way that you can look at not just the B-cell depletion, but also potentially depletion of the active T-cells? Thanks.

David Chang (President, CEO, and Co-Founder)

Yeah, John, great question. It's something that we constantly talk about internally. Let me pass off to Zach to answer the questions about the length of follow-up that we may have and what else we're going to be looking at in the biomarker analysis.

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Yeah. Thanks, John. We haven't said exactly how much follow-up we expect to have. We have said that with the trial starting middle of this year and us obviously moving as quickly as we can, we should have a handful of patients treated hopefully by the end of the year and a little bit of follow-up. I mean, what we've guided towards in terms of proof of concept is, as David pointed out earlier, the biomarker data, so B-cell depletion as well as expansion of the CAR T cells. We'll have some early safety results too. We can gather that information in relative short order in a clinical trial. We won't really have a significant read on durable efficacy, of course, by the end of this year.

Diving into your second question on the specific analyses that we plan to conduct, obviously, B-cells is a must-have. The T-cells, as we have shown in the 316 program, is going to be an area of focus as well. What I think we've elegantly shown, such as in the SITC data just a few months ago, is that we can really parse out the CD70 positive versus the CD70 negative cells in the patients. Really, that is what has given us the foundation that has validated the dagger effect in patients. We'll be doing very similar analyses in 329 and seeing whether we are seeing that evidence of a strong dagger effect in these patients.

John Newman (Managing Director)

Okay. Great. Thank you.

Operator (participant)

Thank you. Our next question comes from Asthika Goonewardene with Truist. You may proceed.

Asthika Goonewardene (Managing Director and Senior Biotech Equity Research Analyst)

Hey, guys. Thanks for taking my questions, and I appreciate all the color today. I want to follow up John's excellent question on the RESOLUTION study. It is great to see that you guys are aiming to explore the lymphodepletion-free strategy as well here. I want to ask you this. How much follow-up do you need to answer that question? I ask because just in some of these indications they're going after, the KOLs out there would like to see maybe a treatment benefit up to six months or even a year.

Do you think you'll need to do that, to go all the way up to then, to really answer that question of whether or not you can go with the lymphodepletion-free strategy? A second quick follow-up. On the JCO publication, all the durable responses were CRs, and it also goes further to say that all six patients with low disease burden had CRs. I'd like to confirm, are those the six patients that are the ones that are still in response on the swimmer at the data cutoff on that paper? Thanks.

David Chang (President, CEO, and Co-Founder)

Yeah. I think that's two questions. Let me take the 329 RESOLUTION question about whether we need to follow the patient for longer. Definitely, without question, we will be following these patients longer than the initial biomarker data analysis. The way we see it is a biomarker, especially B-cell depletion and cell expansion, autoantibody, titer changes. I think these are very great telltale signs around whether the treatment is 329 is behaving as we have expected.

Obviously, as we follow these patients, we will get more information about the clinical outcome, including if some of these patients are going to complete remission, how long they may last. I mean, those are much longer follow-up, and they will not be the part of the initial data release that we are projecting year-end. The second question, I'll pass off to Zach to respond. Zach?

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Yep. Thanks, Asthika. The first thing to kind of keep in mind, as you pointed out in your question, is the most important outcome after any treatment at all, whether it's CAR T cells or anything else, is that you achieve a complete remission. That is obviously the number one thing because if you don't get to a complete remission, your chance at a durable cure is zero.

That's the first thing to keep in mind. What we showed in our subgroup analysis is that if you had low disease burden as assessed by either the tumor measurements or by the serum LDH, you had an extremely high chance of achieving that must-have clinical scenario of a complete remission. That said, we want to also tout that the cema-cel product itself is a very potent product. Obviously, it's very active, as the JCO paper indicated. We actually had plenty of patients that had bulky disease that achieved durable CRs as well. It was a little bit of mixing and matching.

Operator (participant)

Thank you. Our next question comes from Matthew Biegler with Oppenheimer & Co. You may proceed.

Matthew Biegler (Senior Research Analyst)

Hey, guys. Thanks for the question. I'll ask another one on RESOLUTION, but maybe in a slightly different way, which is hypothetically, how much efficacy are you, I guess, potentially willing to leave on the table to get away with no lymphodepletion, i.e., is no lymphodepletion really a game changer, or is it just a nice-to-have, in your opinion? Thanks.

David Chang (President, CEO, and Co-Founder)

Yeah. Matthew, excellent question. You're asking things that are highly debated internally. I mean, probably the best way that I can sort of describe is lymphodepletion is a potential barrier. I mean, if you can lower the lymphodepletion, that's a big plus. If you can eliminate, that's really a big, big game changer.

Frankly, probably the best way to think about it is when it doesn't have the burden of lymphodepletion, it can be used more widely. It really creates the potential to treat not only autoimmune disorders with a high severity but also moderate severity. It gives a lot more opportunity to address different patients. Yeah, we would love to have no lymphodepletion, but I think even just lowering the lymphodepletion would be a significant win for the 329 program.

Appreciate it.

Operator (participant)

Thank you. Our next question comes from Luca Issi with RBC Capital Markets. You may proceed.

Shelby Hill (Senior Equity Research Associate)

Hey, guys. This is Shelby on for Luca, and thanks for taking the question. On ALPHA3, it's our understanding that there's an option for inpatient or outpatient treatment. Is that decision left up to the investigator? How should we think about the mix of patients who will be treated outpatient versus inpatient? Any color there. Much appreciated. Thanks.

David Chang (President, CEO, and Co-Founder)

Yeah. Shelby, I'm going to ask Zach to respond to your question. Zach?

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Yep. Thanks, David and Shelby. There is no requirement at all for inpatient either LD or cell administration. It is entirely up to the investigator on a case-by-case basis. I will say that we are seeing, as we've seen for a long time in our cema-cel programs, even in the ALPHA and ALPHA-2, we are seeing a significant number of these patients being treated fully as an outpatient. Of course, that is the vision. Part of the vision for this product is that it's going to be easy to administer in the clinical settings where these patients receive frontline care. As for sort of specific characteristics that would lead to a patient being treated inpatient versus outpatient, I mean, there's a host of them. I won't go into them now.

One of the great benefits of the ALPHA3 study is that all of these patients are going to be in remission when they receive their cema-cel and their lymphodepletion. As David pointed out earlier in the call, patients with low disease burden tend to have better safety outcomes than those with high disease burden. On balance, we would expect a significantly greater fraction of these patients over the duration of the study to be managed as fully as outpatients. That is our expectation.

David Chang (President, CEO, and Co-Founder)

Yeah. If I can add one color to that response, Shelby, I mean, I think the important thing is that in the ALPHA3 study, we do not require hospitalization. In that way, in essence, what that's doing is this trial is just like any other trial. What a physician does with that information, whether they decide to treat as a fully outpatient or maybe put him in the hospital for a day or two, I mean, that's essentially how the practice is done not just in cell therapy but in any other cancer treatment. It is really giving the patient and the physicians the option on how they want to receive the investigational therapy in the ALPHA3 study.

Operator (participant)

Thank you. Our next question comes from Samantha Semenkow with Citi. You may proceed.

Samantha Semenkow (Vice President of SMid Biotech Equity Research Analyst)

Hi. Good afternoon. Thanks very much for taking the question. Some of your autologous CAR T counterparts have spoken about a push to expand into large community oncology centers that could potentially overlap with your ALPHA3 trial sites. I am wondering, to what extent are you seeing this infrastructure being built at the community centers you interact with? How much of this groundwork do you think could be in place by the time you potentially launch cema-cel? How are you thinking about your ability to leverage this infrastructure for the launch? Thanks very much.

David Chang (President, CEO, and Co-Founder)

Yeah. Samantha, excellent question. I think the effort, not just by us, but also in the entire CAR T community to move into the sort of community-based cancer centers, I think that's just going to extend and expand the usage of CAR T. I mean, that's a very important aspect of any product launch and product life cycle management. I think in many ways, here is where the allogeneic CAR T really plays favorably. I mean, not having the logistical challenge, just being able to ship the product when the patient needs the treatment.

Also, in our case, as we're learning, as we improve the manufacturing, the scalability of the manufacturing, all these things are playing in our favor. As the effort from the autologous CAR T companies to expand their use into the community cancer centers, we see that as a positive thing for the field. We also see that as a positive thing for what we are doing with the ALPHA3 trial.

Operator (participant)

Thank you. Our next question comes from Ben Burnett with Stifel. You may proceed.

Carolina Ibanez Ventoso (Analyst)

Hi. This is Carolina Ibanez Ventoso for Ben. Thank you for taking our questions. First, on the interim analysis of cema-cel in mid-2025, can you remind us when you are measuring the MRD conversion? Is it at one month post cema-cel infusion or later? I have a follow-up.

David Chang (President, CEO, and Co-Founder)

Yeah. Yeah. We're trying to limit the questions to one. Zach, you want to take the question about the timing of the MRD test?

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Yeah. Thanks, Carolina. We have not disclosed exactly the timing of that draw. As David pointed out earlier, of course, there will be other elements that we're assessing to make that lymphodepletion decision in addition to the MRD conversion.

Carolina Ibanez Ventoso (Analyst)

Okay. Understood. Thank you.

Operator (participant)

Thank you. Our next question comes from Laura Prendergast with Raymond James. You may proceed.

Laura Prendergast (Vice President and Biotech Equity Analyst)

Hey, guys. Can you elaborate a bit more on the registrational path for the Foresight MRD test and how it relates to the registrational path for cema-cel and first-line lymphoma? Thanks.

David Chang (President, CEO, and Co-Founder)

Hey, Zach, do you want to take that question?

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

Yeah. That'll be an easy one. Thanks, Laura. The plan has been all along to have a concurrent launch of these products at the time of the FDA approval. The specifics around the path to registration of the MRD test, though, I would refer you to the Foresight management.

Laura Prendergast (Vice President and Biotech Equity Analyst)

You don't foresee it being an issue at all with getting cema-cel approved in first line?

Zachary J. Roberts (EVP for Research and Development, and Chief Medical Officer)

No.

Laura Prendergast (Vice President and Biotech Equity Analyst)

Got it. Thanks.

Operator (participant)

Thank you. That concludes our Q&A session. I would like to turn the conference back over to management for any additional comments.

David Chang (President, CEO, and Co-Founder)

All right. Thank you. I just want to reiterate, Allogene enter 2024 with a bold strategy. Today, we stand on the brink of a transformative year. With three pioneering programs, each approaching critical milestones, we are proving that allogeneic CAR T has the potential to redefine patient care. Thank you for your ongoing belief in Allogene and the field of cell therapy. Operator, you may now disconnect.

Operator (participant)

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