Analyst Conference Summary

Juno Therapeutics

conference date: November 1, 2017 @ 2:00 PM Pacific Time
for quarter ending: September 30, 2017 (Q3, third quarter)

Forward-looking statements

Overview: Pipeline development continues. Emphasized JCAR017 DLBCL data, which is pretty amazing. Partner Celgene had also emphasized how good this data is on its call.

Basic data (GAAP):

Revenue in the quarter was $44.8 million, up 110% sequentially from $21.3 million and up 115% from $20.8 million in the year-earlier quarter.

Net loss was $118.1 million, down sequentially from a loss of $100.7 million, but down from a loss of $56.9 million year-earlier.

EPS (diluted) was negative $1.12, down sequentially from negative $0.96, and down from negative $0.56 year-earlier.


Cash burn in 2017 should be in the lower half of prior gudance, which was $270 to $300 million.

Conference Highlights:

Hans Bishop, Juno’s President and CEO, said "We are pleased with the potential best-in-class profile for JCAR017, and we look forward to presenting an updated dataset at the upcoming ASH conference. The clinical data continue to support our belief that a defined cell product can improve patient outcomes. Our broad clinical development programs and ongoing infrastructure and manufacturing investments remain a key part of our strategy to deliver on the potential of CAR T cell therapies for cancer patients across a broad array of diseases."

Juno and collaborators will present 15 abstracts at the ASH (American Society of Hematology) meeting. They are available today.

The JCAR017 for relapsed/refractory B cell NHL (non-Hodgkin lymphoma) trial continues to enroll at dose level 2 (core group). Updated DLBCL data for includes 80% ORR and 73% CR (complete responses) at dose level 2 at 3 months. Goal for approval by FDA is as early as end of 2018. Noted there was no increse in cytokine release syndrome or neurotoxity rates associated with the higher does. Incidence for the full group was 1/69 for severe CRS and 21/69 for any CRS; 10/69 had severe NT and 14/69 had any NT. JCAR017 received RMAT (Regenerative Medicine Advanced Therapy) designation, which may accelerate approval. Believes the safety and efficacy data is due to the ability to control the dose, including components within the dose, providing a competitive advantage.

A new trial, Platform, was initiated using JCAR017 with durvalumab in r/r aggressive NHL patients (in partnership with Celgene).

JCAR014 continued a Phase 1b combination trial with MedImmune's PD-L1 investigational agent durvalumab for r/r NHL. Began a combination trial with ibrutinib in CLL. Will also start a trial in combination with JCAR017.

JCAR018 (CD22) in a Phase 1 trial for r/r ALL interim data for 3 patients showed all remained in complete remission. But there was dose-limiting neurotoxicity. The trial continues to enroll patients.

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

Juno began a Phase I trial in r/r B cell malignancies for its CD19/4-1BB ligand armored CAR.

Juno continued trials for solid tumor product candidates against five different targets - JCAR024 (ROR-1-directed CAR T), JCAR020 (MUC-16-directed armored CAR T engineered to secrete IL-12), JCAR023 (L1-CAM-directed CAR T), JTCR016 (WT-1- directed TCR) and a Lewis Y-directed CAR in lung cancer. Early data could be presented at AACR in 2018.

JCARH125 has a fully human BCMA binder. A Phase 1 trial for multiple myeloma will begin in early 2018. Other trials with novel binders are already underway.

Important updates are likely to become available at ASH in December.

See Juno Therapeutics pipeline.

Cash and equivalents balance ended at $1.06 billion, up sequentially from $802 million. In the quarter Juno raised $318.7 million with a stock offering at $41.00 per share. Cash used in operating activities was $40.3 million. Cash used for capital expenditures was $13.9 million. No debt.

Operating expense of $166.6 million consisted of: $140.3 million for R&D and $23.3 million for general and administrative. Operating loss was $121.8 million. Interest income $2.0 million. Other expense $0 million. Income tax benefit $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.

Q&A: [note this is my summary, not a transcript]

JCAR017 percent of enrollment, timeline? We don't provide details, but we plan to file a BLA in the second half of 2018. We have already begun to enroll the pivotal cohort.

Outpatient administration? 64% of patients have had no CRS or NT. It is a matter of understanding their treatment course. There is no single deciding variable. The reason to do outpatient is to protect patients from hospital infections, as they are highly immunocompromised.

Comparing to Gilead's therapy, what is needed to compete and differentiate? You have to look at both tolerability and efficacy. There were no grade 5 events reported for CRS or NT.

ASH data cutoff? Yes, there will be more patients and longer follow up, with dose level two and safety. Outpatient data at ASH is to be determined, but just a handful.

Bearish idea about hospitals making these types of products in house? It is extraordinarilly difficult for hospitals to make a product of this complexity. The investment in quality control can represent about 50% of the cost of CART.

All the patients being studied in Transcend are quite ill, they are chemo refractory, they have never been in CR. Most have a likely survival time of 3 to 6 months. But the label will likely be based on the number of previously failed therapies. The first label expansions would likely be related to transplant status.

We have not seen any CART related deaths in our solid tumor program, but this is very early and minimal data.

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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 2017 William P. Meyers