Fate Therapeutics, Inc. Q2 FY2023 earnings call

• The company received IND allowance for FT522 CAR-NK cell program in B-cell lymphoma, with Phase I trial start-up ongoing and first patient enrollment planned for H2 2023.
• Progress in Phase I studies: FT576 in multiple myeloma has enrolled first patient in 3-dose cohort; FT819 in B-cell lymphoma had no dose-limiting toxicities and enrollment expanded.
• FT825 CAR-T cell program in collaboration with ONO Pharmaceutical is on track to submit IND in H2 2023 for HER2+ solid tumors, with preclinical data showing potent antitumor efficacy.
• Continued preclinical assessment of off-the-shelf cell therapies for autoimmune diseases, reviewing clinical data from FT819 and FT596 studies.

Fate Therapeutics had revenue of $900,000 in Q2 2023, a significant decline from $18.5 million in the same period last year, derived exclusively from the collaboration with ONO Pharmaceutical. Research and development expenses decreased by 50% to $40.9 million compared to the same period last year, primarily due to lower salaries, benefits, and R&D supplies. General and administrative expenses increased by 11% to $22.6 million, mainly due to legal fees. Total operating expenses declined 25% to $63.5 million. Net loss for the quarter was $52.8 million or $0.54 per share. Cash, cash equivalents, and investments at the end of Q2 were approximately $385 million.

• Revenue from ONO collaboration is expected to total about $800,000 per quarter through Q3 2024.
• Full year GAAP operating expenses are expected to be in the range of $265 million to $285 million, with year-end cash and investments exceeding $300 million.
• FT825 IND submission planned for H2 2023; FT522 first patient enrollment in H2 2023; data from FT819 and FT576 expected in early 2024.

• Forward-looking statements involve risks where actual results may differ materially. See the company's Form 10-Q for the quarter ended June 30, 2023, for detailed risk factors.

Q: On FT522, thoughts on engraftment threshold and dose escalation between regimens A (with conditioning) and B (without conditioning)?

A: Both arms can escalate in parallel. First cohort starts with regimen A (with conditioning), and if no dose-limiting toxicities in first 3 patients, regimen B (without conditioning) opens for enrollment.

Q: On timing of data from FT819 and FT576?

A: Expect data from these programs in early 2024 as they enroll cohorts to define therapeutic profiles.

Q: On ADR technology and durability of response for FT522?

A: Hopeful based on preclinical data showing enhanced potency, protection, and activity, but clinical data needed to finalize.