Analyst Conference Summary

Juno Therapeutics

conference date: August 4, 2016 @ 2:00 PM Pacific Time
for quarter ending: June 30, 2016 (Q2, second quarter 2016)

Forward-looking statements

Overview: Clinical stage development company continued to make pipeline progress in the quarter despite the JCAR015 setback.. Moved back first approval, of JCAR015 for ALL, from 2017 to first half of 2018.

Basic data (GAAP):

Revenue in the quarter was $27.6 million, up sequentially from $9.8 million and $12.5 in the year-earlier quarter.

Net loss was $66.0 million, up sequentially from a loss of $71.1 million, and up from a loss of $67.6 million year-earlier.

EPS (diluted) was negative $0.64, up sequentially from negative $0.72, and improved from negative $0.79 year-earlier.


Cash burn guidance for 2016 was reaffirmed: $220 to $250 million excluding business development activities. That includes capital expenditures of $40 to $55 million.

Conference Highlights:

The big news in the quarter was the stopping of the JCAR015 Phase 2 ROCKET trial following deaths that were attributed to adding a second chemotherapy agent to the pretreatment regime. The trial resumed only a few days after the hold order, without the second chemo agent. Juno still expects U.S. approval for JCAR015 as early as the first half of 2018. "If the ROCKET data are in the range of the Phase I results, where most patients were treated using this preconditioning regimen, we will have the opportunity to change the standard of care and offer improved hope for adult patients with relapsed or refractory ALL,” said Hans Bishop, CEO.

Pointed out that the toxicity leading to deaths in the ROCKET trial was not caused by fludarabine alone. "We believe that the intensity of the two agent depletion combined with JCAR015, at this dose, in the setting of ALL, contributed to some patients experiencing very rapid cell expansion which in turn correlates strongly with the risk of severe toxicity" [and death].

Celgene opted into the Juno Therapeutics CD19 program in April. Multiple trials were enrolled. Celgene paid Juno $50 million and will share worldwide R&D expense, will have commercial rights outside the U.S.and China, and will pay a mid-teens royalty.

The JCAR017 Phase 1 study in relapsed/refractory B cell NHL (non-Hodgkin lymphoma) continues to enroll. Getting a encouraging remission rates and safety. Believes JCAR017 could be approved as early as 2018. The Phase I/II study by Seattle Children's interim results in pediatric and young adult r/r ALL had 93% complete remission (39 or 42 subjects).

JCAR014 Phase 1 ALL new trial in combination with MedImmune's durvalumab PDL-1 CPM began enrollment. Interim results from the Phase I/II advanced B cell malignancies study achieved 100% complete remission. But severe neurotoxicity was observed in 39% of patients. In CLL the OR rate was 91% with 45% complete remission, but 23% of patients had severe neurotoxicity.

JCAR018 in a Phase 1 trial for ALL interim data for 3 patients showed all remained in complete remission. But there was dose-limiting neurotoxicity

JTCR016 for refractory mesothelioma so far of three patients only one had a partial response.

Juno bought rights for a B-cell maturation antigen from MSK and Eureka Therapeutics. The BCMA CAR should start a trial in 2017.

Juno bought Redox Therapies for is adenosine A2a receptor agonist. Adenosine is directly immuno-supressive to T cells.

See Juno Therapeutics pipeline. Plans to have 9 product candidates against 6 targets by mid 2016. A 10th product candidate should be in the clinic in later 2016.

Cash and equivalents balance ended at $1.11 billion, down sequentially from $1.13 billion. Cash burn for the quarter was $55.2 million, excluding business development activities and $50 cash from Celgene. No debt. A $50 million Celgene opt-in payment was received.

Operating expense of $89.1 million consisted of: $72.3 million for R&D and $16.8 million for general and administrative. Operating loss was $61.5 million. Interest income $1.5 million. Income tax benefit $1.2 million.

Juno has adequate cash "to last us into the next decade."

Juno continues to do fundamental science research on immune system cells that could help make more effective cancer therapies.


JCAR017 NHL dosing, safety and efficacy? Known that one factor of toxicity is cell dose. Being able to use low dosing for NHL and getting high effectiveness differentiates this therapy target. But the data is still very early. The manufacturing for the trial has switched to Bothel, but the results are from the prior manufacturer.

BCMA color? The first in human setting will assess the binder. We hope to expand specificities and do a second generation platform.

Treatment of patients with neurotoxicity, prediction with biomarkers? We have been doing a number of analyses and getting a better understanding of cytokines. We are generating hypotheses and looking for predictive assays and interventions like anti-cytokine antibodies. We would like to prevent neurotoxicity entirely and are exploring that in preclinical models.

Next JCAR017 adult NHL update? We would hope it would be at ASH, that depends on the acceptance of abstracts.

Registrational study timelines? Too early to be more precise. We are most advanced in pediatric ALL. We'll let you know. DLCBL is likely to be the first to get an actual approval, in 2018.

JCAR015 response durations? Transplant v. non-transplant has a bias in the comparison. Median response runs out 8 to 9 months. Zero relapses so far in the group that has gone for 12 months.

Children's Hospital JCAR017 toxicity and response rates? 29% overall severe neurotoxicity. But there is an increase of toxicity with dosing increases. Minimal time to count as durable response is currently 4 months.

The reason to go ahead with 015 despite the likely superiority of 017 is that there is an urgent need, patients should not have to wait, and it helps us develop our capabilities.

JCAR014 CLL trial, how many had flu-cy preconditioning? Of 13 reported, 11 had flu-cy, and it was high-intensity. High intensity flu-cy is a standard therapy in CLL.

We still believe that fully-human constructs are important.

What would it take to move past salvage to the less sick populations? We will look at benefit to risk, first in the current populations, then in the lower risk groups. The risk of toxicities does correlate to disease burden, particularly in ALL. We do need to increase tolerability and reduce toxicity, since there are so many competitors in the early therapy space. Also, demonstration of long-term durable responses.

OpenIcon Analyst Conference Summaries Main Page



More Analyst Conference Pages:



Disclaimer: My analyst call summaries may include both our condensations of statements made by company representatives and my own analysis. They are not covered by any warranty. I cannot guarantee anything said by company representatives is true. I try not to make errors, but it is possible. This is investment journalism, not financial advice.

Copyright 2016 William P. Meyers