Earnings call transcript: Allogene Therapeutics’ Q2 2025 earnings reveal strategic shifts

Allogene Therapeutics Inc. (ALLO) reported its Q2 2025 earnings, revealing a net loss of $50.9 million, or $0.23 per share, outperforming the expected loss of $0.2685 per share. The company’s stock reacted positively in aftermarket trading, rising 2.91% to $1.06, as investors responded to the strategic advancements in its clinical pipeline and financial guidance. According to InvestingPro analysis, the company’s overall financial health score is weak at 1.7 out of 5, though current data suggests the stock may be undervalued based on Fair Value calculations.

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Key Takeaways

• Allogene reported a narrower-than-expected loss of $0.23 per share.
• Positive market reaction saw the stock increase by 2.91% in aftermarket trading.
• The company’s cash position remains strong, with $302.6 million on hand.
• Promising developments in clinical trials, particularly in CAR T therapies.
• Strategic focus on reducing lymphodepletion in treatment protocols.

Company Performance

Allogene Therapeutics continues to advance its position in the allogeneic cell therapy sector, despite reporting a net loss. While InvestingPro data shows the company is quickly burning through cash, its financial position remains supported by a healthy current ratio of 9.71, indicating strong short-term liquidity. The company’s strategic advancements in clinical trials, particularly the ALPHA-three and ALLO-three sixteen trials, show promise, aligning with its focus on innovative cancer treatments and autoimmune disease therapies.

Financial Highlights

• Cash position: $302.6 million as of June 30, 2025
• Q2 R&D expenses: $40.2 million
• Q2 G&A expenses: $14.3 million
• Net loss: $50.9 million, or $0.23 per share
• Expected 2025 cash burn: Approximately $150 million

Earnings vs. Forecast

Allogene’s reported EPS of -$0.23 was better than the forecasted -$0.2685, marking a positive surprise for investors. The company’s ability to manage expenses and maintain a strong cash position contributed to this performance. This result represents a significant improvement over previous quarters, indicating effective cost management and strategic focus.

Market Reaction

Following the earnings announcement, Allogene’s stock rose by 2.91% in aftermarket trading, reaching $1.06. This movement reflects investor confidence in the company’s strategic direction and its ongoing efforts to innovate within the cell therapy space. However, InvestingPro data reveals the stock has declined over 51% year-to-date, with analyst price targets ranging from $2.50 to $14.00, suggesting significant potential upside according to Wall Street expectations. The stock’s performance remains volatile within its 52-week range of $0.862 to $3.78.

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Outlook & Guidance

Looking forward, Allogene projects a cash runway extending into 2027, supporting its clinical developments. The company anticipates full-year GAAP operating expenses of approximately $230 million and expects to share MRD conversion rates at an interim analysis. These projections underscore Allogene’s commitment to advancing its pipeline and achieving key milestones in its clinical trials.

Executive Commentary

David Chang, CEO, highlighted the company’s unique position, stating, "We are one of the last allogeneic cell therapy companies standing and the one with the most diverse and advanced clinical pipeline." Chief Medical Officer Zachary Roberts added, "By reducing or potentially eliminating lymphodepletion, we’re taking a bold step toward reshaping what’s possible in the treatment of immune-mediated conditions."

Risks and Challenges

• Regulatory hurdles in advancing clinical trials.
• Competition from other cell therapy companies.
• The potential for increased R&D expenses impacting cash flow.
• Market volatility affecting stock performance.
• Dependence on successful trial outcomes for future growth.

Q&A

During the earnings call, analysts inquired about the company’s MRD conversion rate, which was discussed as a potential meaningful benchmark at 30%. Executives also addressed the rationale behind changes in study designs and safety considerations in clinical trials, providing clarity on the company’s strategic decisions.

Full transcript - Allogene Therapeutics Inc (ALLO) Q2 2025:

Conference Operator: Hello, and thank you for standing by, and welcome to Allogene Therapeutics Second Quarter twenty twenty five Conference Call. After the speakers’ presentation, there will be a question and answer session. To ask a question, please press 11 on your telephone At this time, all participants are in a listen only mode. Please be aware that today’s conference call is being recorded. I would now like to turn the call over to Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer.

Ms. Casciano, please go ahead.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics: Thank you, operator, and thank you for joining this call. After the market closed, Allogene issued a press release that provided a business update and financial results for the 2025. This press release and today’s webcast are available on our website. Following our prepared remarks, we will host a Q and 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 Doctor. David Chang, President and Chief Executive Officer Doctor. Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer and Jeff 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 and Chief Executive Officer, Allogene Therapeutics: Thank you, Christine, and welcome, everyone. This past quarter marked a period of significant advancement across our portfolio with progress that highlights how scientific excellence, rigorous decision making and thoughtful planning and execution can call us into transformative momentum. We are seeing the power of this approach across our pipeline from SEMA cell in first line consolidation for large B cell lymphoma to ALLO-three sixteen in solid tumors and now ALLO-three twenty nine in autoimmune disease. Let me begin with semisel in the ALPHA-three study. The ALPHA-three study has been streamlined into a two arm randomized trial comparing treatment with semisel following a standard lymphodepletion regimen of fludarabine and cyclophosphamide in the active arm to observation in the control arm.

This decisive move made in conjunction with the Data Safety Monitoring Board and Steering Committee reflects our unwavering commitment to patient safety. It also reflects our ability to act swiftly, balancing scientific judgment with agility to create and preserve the long term value of our platform. I also would like to thank the review team at the FDA that provided prompt informal consultation and guidance. More than 50 sites are now activated across The U. S.

And Canada and additional international expansion is underway. We remain on track for the planned futility analysis in the 2026 and expect to share MRD conversion rates at that time. The changes to the protocol exemplify our vision to redefine CAR T therapy by prioritizing patient accessibility in every stage of development. Turning to ALLO-three 16, our CD70 targeted CAR T for renal cell carcinoma, we presented compelling Phase I data at ASCO twenty twenty five. This trial serves as a significant proof point for our Dagger platform and how this technology may define the future of off the shelf cell therapy.

The results seen to date from the TRAVERSTE trial underscore the potential for DAGGR technology to support both robust expansion of CAR T cells and durable clinical responses in cell tumors. We have since aligned with FDA on a pivotal trial strategy and are actively exploring partnership opportunities with several third parties to advance this program. In autoimmune disease, we open enrollment in the resolution study, one of the first allogeneic CAR T trials in this space and the first of such to contemplate a new approach to lymphodepletion. We have designed both our AlloCAR T product and the trial itself with patient accessibility, not as an afterthought, but as a priority from the outset. By simplifying or eliminating lymphodepletion altogether, we are testing both hypothesis grounded in strong science and clinical insight.

This study reflects not only our ambition, but also our readiness to challenge paradigms with data. Each of these advances is rooted in the belief that the breakthroughs are not born by a chance, they are built. They emerge from foundation of strong science, disciplined execution, cross functional collaboration, and the agility to adapt and evolve when circumstances change. Nowhere is this more evident than in cell therapy, a field with a potential to transform how we treat disease and in doing so generate extraordinary value for those who invest in companies that have demonstrated the ability to navigate the train. While early optimism often feels bold ambition, reality is often far more complex, especially in the unforgiving terrain of clinical development where transformative idea must be tested and refined.

That’s why many have started on this path, yet only a few have advanced beyond the early promise. Allergen stands among the few that have successfully persevered in this field. From the beginning, we have committed to these principles, not just in theory, but in practice. Today, we are one of the last allogeneic cell therapy companies standing and the one with the most diverse and advanced clinical pipeline and we take that position seriously. While the finish line in this field is neither fixed nor guaranteed, our continued progress reflects the depth of our platform, the strength of our team and our unwavering commitment to doing the hard necessary work that real innovation demands.

As we look ahead, our near term milestones are more than clinical achievements. We believe they are value driving catalysts that reinforce our foundation and advance our vision of making allogeneic CAR T the standard of care. I want to thank the entire Allogene team for their passion and commitment and give a special thanks to Zach for his steady leadership in R and D. The choices we made this quarter really reflects our responsibility to move boldly and thoughtfully, always keeping patients at the center. With that, I’ll hand it over to Zach.

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: Thank you, David. I want to start with a personal reflection on ALPHA-three and the journey this trial has taken. The hypothesis that patients whose only evidence of disease was MRD positivity could be cured by Semi Cell without the need to use enhanced lymphodepletion was always compelling. Standard Fc is widely used, well tolerated, and critically easier for doctors to give and patients to receive than a regimen that includes an additional infusion of an anti CD52 monoclonal antibody. Furthermore, because these patients are just coming off six cycles of treatment, they are partially lymphodepleted already.

For these reasons, we designed the study to test this hypothesis by comparing standard Fc to the enhanced regimen that included ALLO-six forty seven, our anti CD52 monoclonal antibody. While the recent developments in the trial required that we make a decision on lymphodepletion sooner than planned to ensure the safety of patients in the trial, the early biomarker and safety data emerging from the standard SC arm has given us confidence that the trial is moving ahead with the right treatment regimen. From the beginning, standard FC is the regimen we always hoped would be the ultimate outcome, potentially optimizing benefit risk and frontline consolidation and driving greater uptake in both the clinical trial and commercial settings. Following this selection, ALPHA-three is now proceeding as a two arm randomized trial comparing SEMA cell after Fc lymphodepletion versus observation. With more than 50 sites now open and incoming interest from new investigators globally, we continue to see a high degree of engagement from our sites and are continuing to add patients to the pipeline for MRD screening to support enrollment.

For many sites, the simplification and streamlining of the study through the removal of the FCA arm is expected to boost participation and further strengthen engagement. In fact, the response of investigators to this design change has been quite positive, reinforcing our confidence that the path forward improves the safety and scalability of the study while significantly enhancing its appeal to participating centers. Accordingly, we remain on track for the planned futility analysis in the 2026, which will assess MRD conversion rates between the two arms and provide a critical early signal of efficacy. This is the intersection of science, clinical design, and discipline execution, and where meaningful progress is made. Turning to ALLO-three 16, our Phase 1b data presented at ASCO showed promising responses in a heavily pretreated RCC population.

The strength of our dagger platform supported exceptional CAR T expansion and persistence. As David noted earlier, following recent alignment with the FDA on a pivotal trial design, we’re actively exploring partnership opportunities to advance the program. Resolution, our study in autoimmune disease, is now open and actively screening patients. This trial represents a meaningful expansion platform into a new disease area and into uncharted territory for the field. It allows us to explore how we might fine tune the levers of lymphodepletion with greater precision.

By reducing or potentially eliminating lymphodepletion, we’re taking a bold step toward reshaping what’s possible in the treatment of immune mediated conditions. If successful, Resolution could serve as the foundation for a new therapeutic paradigm. We look forward to providing an update on the early clinical results from the resolution study in the 2026. Taken together, these programs reflect both the maturity of our platform and the clarity of our strategy. This is no longer conceptual.

It’s advanced clinical development moving forward because of the discipline, foresight and execution by our team. We’ve entered a stage where conviction matters. As R and D leaders, we’re called to rely on the strength of our science. In cell therapy, we must make complex decisions, but we are confident in the direction we’re heading, and even more so in the evidence that’s pointing us forward.

Conference Operator: In the coming months, you will see

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: us continue to advance these studies built on the momentum we’ve created and stay focused on delivering not only clinical value, but a durable platform capable of changing how patients are treated across multiple diseases. With that, I’ll hand the call over to Jeff.

Jeff Parker, Chief Financial Officer, Allogene Therapeutics: Thank you, Zach. As David and Zach have outlined, our operational progress has been matched by disciplined financial stewardship. As of 06/30/2025, we had $302,600,000 in cash, cash equivalents and investments. Our cash runway continues to extend into the 2027. R and D expenses for the second quarter were $40,200,000 including $2,600,000 of non cash stock based compensation.

G and A expenses for the second quarter were $14,300,000 including $6,100,000 in non cash stock based compensation. Net loss for the second quarter was $50,900,000 or $0.23 per share, including non cash stock based compensation expense of $8,700,000 and non cash impairment of long lived asset expenses of $2,400,000 We continue to expect 2025 cash burn of approximately $150,000,000 and full year GAAP operating expenses of approximately $230,000,000 which includes an estimated non cash stock based compensation expense of approximately $45,000,000 This guidance excludes any impact from potential business development activities. Let me conclude by highlighting that our allogeneic platform allows us to manufacture product well in advance and at scale, supporting trial execution while enabling cost reductions. With a refined strategy and strong clinical catalysts ahead, we remain confident in our position. We’ll now open the call for questions.

: Thank you.

Conference Operator: Our first question comes from Tyler Van Buren with TD Cowen. You may proceed.

Tyler Van Buren, Analyst, TD Cowen: Hey, thanks very much. Appreciate taking the question and congrats on the progress during the quarter. So as we think about the scheduled futility analysis in the first half of next year and since you announced that you plan to provide the rates of MRD conversion between the two arms at the time of the announcement, what does good look like as you think about the bar for success with the MRD conversion rates?

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Hi, Tyler, Dave Chang here. Great question. And it’s something that we have been thinking about quite a bit here. And we have been asked this question a few times and we’ve been giving rough estimate about 30%. But now that we are beginning to talk about the MID conversion rate in more concrete way, Let me give you some reference points about where we are coming to about the delta of 30% difference in the MRD conversion rate being meaningful.

So here I would just ask you to sort of equate the MRD conversion to the remission, complete remission that you see with the CAR T treatment. And with that one assumption, take the reference point to the USPI of Yescarta and BRYANZI, both of them are approved in the second line setting in a randomized study that used event free survival endpoint. In those studies, BRYANZI showed statistically significant and clinically meaningful event free survival as well as progression free survival benefit. And in that data set, if you look at the delta in the complete remission rate, that was twenty seven percent. Now if you take the same to the Yescarta USPI, again, the ZUMA-seven study showed statistically significant and clinically meaningful event free survival benefit as well as progression free survival benefit.

And in the follow-up, they also showed a overall survival benefit. And when you look at their initial indication of efficacy, which is really the response rate, the complete remission rate difference between the, yes, cutter arm and the standard of care, bone marrow transplant arm that was thirty three percent. So those are sort of the reference point that we are using and to sort of guide about a delta of thirty percent difference in the MRD conversion rate could potentially give us statistically significant and clinically meaningful benefit demonstration of the ALPHA-three study.

Conference Operator: Thank you. Our next question comes from Byron Amin with Piper Sandler. You may proceed.

Byron Amin, Analyst, Piper Sandler: Yes. Hi, thanks for taking my question. Maybe just to expand on the last question, how should we translate if we’re able to see a 30% delta on MRD conversion? Should we expect similar EFS benefit to what was observed with BRYONZI and CARTA in their respective trials in the second line setting? And then second question is on cash runway guide to the second half actually, 2027.

Do you anticipate having cash to get to EFS data readout from ALPHA-three? Thanks.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Hi, Biren. Let me take the first question and I’ll pass to Jeff for the second part. So only thing that I ask from what I have responded to Tyler’s question is, if you equate MRD conversion to the CR, the complete remission that you see, which I believe is a fair sort of assumption that one can make. Answer to your question is yes. And let me ask Jeff to comment on the cash guidance.

Jeff Parker, Chief Financial Officer, Allogene Therapeutics: Yes. So, Biren, as you stated, we do have cash into the 2027. Whether that is sufficient to get to EFS readout on alpha-three, frankly, depends on the pace of enrollment that we will see in the trial. And we’ll be updating you on that once we have the futility analysis. As you recall, though, there is an interim analysis and a final analysis in the ALPHA-three study.

And I would say 2027 is going to

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: be right in the ballpark as to when those events could occur.

: Thank you.

Conference Operator: Our next question comes from Salveen Richter with Goldman Sachs. You may proceed.

Mark, Analyst, Goldman Sachs: Hey, this is Mark on for Salveen. Congrats on the quarter, thanks for taking our questions. So kind of to expand on that, how is enrollment progressing for ALPHA-three? You briefly mentioned this in the prepared remarks, but I was wondering if you can give any quantification. Is the discontinuation of the FCA arm in any way sort of impacting patient willingness to enroll and the enrollment cadence?

Thanks.

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: Yeah. Thanks, Mark. This is Zach. I will say that the momentum that we described at the last quarter continues to this day. There’s a lot of interest in patients coming into the study.

It’s a little soon still to see how the discontinuation of FC may impact sorry FCA. Thank you, Christine. Discontinuing of FCA may impact the overall enrollment cadence. What I can say in these very early days post the discontinuation of that arm, we are generally getting positive feedback from investigators who are happy to be dealing with a regimen that they are much more comfortable with. And it’s also they’ve told us that it’s easier in the conversations with the patients.

They don’t have to spend as much time talking about this additional agent that can induce the immunosuppression that is associated with CD52. So I think signs are pointing to a positive impact to the study. So we look forward to being able to update you further at the time of the interim analysis.

Byron Amin, Analyst, Piper Sandler: Thank you.

Conference Operator: Thank you. Our next question comes from Kelly Hsu with Jefferies. You may proceed.

Kelly Hsu, Analyst, Jefferies: Congrats on the progress, and thank you for taking my questions. I’m curious actually whether you see the timing of capturing MRD positive patients post R CHOP have any impact on the MRD conversion rate after the treatment? And also, maybe also the impact on EFS as the endpoint? And the second question is, if we take a step back, can you talk about the clinical evidence from your prior studies or maybe other historical studies? Like, how was the efficacy bar was set for the pivotal frontline consolidation study?

Thank you.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Hi, Kelly. I’m sort of smiling because there’s a lot of questions and very insightful question. Happy to have you covering us again. With respect to the timing of the MRD, in the clinical study, we are doing it in very similar to how the retrospective study was There is a defined window at which the MRD testing is done to make the patient eligible to the ALPHA-three study. And as for the MRD testing after soma cell treatment, we have been saying this occurs within about four to eight weeks after stem cell treatment is done.

So again, that is a similar time period to when one would carry out tumor assessment in a standard way. So the timing of the MRD, I don’t think it will significantly impact what we are doing in the ALPHA-three study.

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: Yes. And there is no data to just piggyback on David’s point. There’s no data Kelly to date to indicate that the timing of that MRD assessment will impact our ability to induce conversions. So and similarly, we don’t expect that to influence EFS. Those are fairly tightly correlated MRD conversion and long term disease control based on prior data from our MRD partner.

And then I think the second question that you asked was around whether there’s any prior data on MRD conversion and whether the bar that we are aiming for is aligned with that prior data. So I’ll actually point back to David’s answer to Tyler’s question around what we think is going to be a clinically meaningful and significant outcome from ALPHA3, and that is around that thirty percent mark. There isn’t really any data in large B cell lymphoma looking specifically at MRD clearance in a prospective way. Alpha-three is really the tip of the spear on this. So we really are looking towards that second line post relapse setting to really set the bar for what efficacy could be.

And we think that bar is certainly achievable with this strategy.

Kelly Hsu, Analyst, Jefferies: Thank you. Super helpful.

Conference Operator: Thank you. Our next question comes from Jack Allen with Baird. You may proceed. Great. Thank you so much

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics0: for taking the questions and congrats again on all the progress. I guess I wanted to ask about how you’re thinking about MRD conversion and its correlation with durability. I know a lot of the earlier stage data

Conference Operator: that

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics0: you have from SEMACELL included both the SC and FCA arm. How much confidence do you have as it relates to the durability of remissions that you maybe see on this MRD test playing out as one time cures here?

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: Thanks, Jack. This is Zack again. So our belief and based rooted in the data that is now sort of growing in the field around this MRD assessment is that an MRD conversion going from positive to negative at the time point that we’re performing the assessment is a very good correlate to long term disease control. So that is why we analyzed this biomarker assessment to enable LD selection, because we did believe that this was going to correlate tightly to EFS.

Jeff Parker, Chief Financial Officer, Allogene Therapeutics: All right. And maybe can I just follow-up? Are you

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics0: going to look at any other internal metrics of durability other than MRD at the time of the interim? And then one brief follow-up on 03/29. I just wanted to think about first half readout next year. What kind of patient numbers could you have there across the different diseases in the basket study?

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: So we will as promised in our materials and in our prepared remarks, we will be giving you some detail around the MRD conversion. We’ll leave it at that for now. With respect to the question on 03/29, we’ve also not given specific numbers on what to expect, except to say that the study is open to enrollment currently, and we do expect to have a meaningful amount of data to share in the first half of next year.

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

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics: Hi, congrats on the progress and thanks for taking my questions. I know previously when we’ve spoken, you guys were initially hesitant to do the MRD analysis with the futility analysis or share that information because you were concerned that sharing the MRD conversion rates could influence the behavior of treating physicians. So, I guess I’m curious how your thoughts around that have kind of evolved and how that might ultimately impact the difference in overall survival between the two arms. And then looking at the ALLO-three twenty nine data, should we expect to see data from both lymphodepletion groups? Thank you.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Yes. So, Sami, David Chang here. You know, the great question. Yes, we do have a lot of sensitivity in the amount of the efficacy data that we can share. ALPHA-three study, it uses the event free survival as the primary endpoint.

So in that sense, the MRD conversion is a secondary biomarker based data. And in the large B cell lymphoma, yes, there are some data that seem to correlate the MRD conversion to the DUOBRII of the response, but that has not been prospectively tested, especially in patients who only evidence of disease is MRD positivity. So there are certain caveats and we’re trying to walk the fine balance. But from the fact that we are limiting the data communication at the interim futility analysis to MRD conversion, we believe that we can still maintain the in a balanced way as we continue to enroll additional patients after the futility analysis. I think the clinical equipoise would not be compromised by sharing the secondary biomarker data on a limited number of patients.

With respect to ALLO-three 29 data communication in the first half of next year. Let’s just say that we are focusing biomarker as well as early clinical data. And as you know, the study is progressing in two different lymphodepletion regimen in it starting with cyclophosphamide only lymphodepletion, which already is a reduced lymphodepletion compared to the standard fludarabine and cyclophosphamide. However, in addition to that, we are also testing no lymphodepletion in a parallel cohort. So we’ll provide more updates on exactly what how much will be included in the first half twenty twenty six update as study progresses.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics: Great. Thank you.

Conference Operator: Thank you. Our next question comes from Matt Biegler with Oppenheimer. You may proceed.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics1: Hey, guys. Thanks for the update. Had a lot of questions on MRD, we haven’t had any on cell expansion. So I’m just wondering, has your thinking changed now that you’re in a lower tumor burden setting on the importance of cell expansion? Is it not as relevant as it was in a higher disease setting?

Because looking back to 2022, your R and D event, the push for June really was that it improved cell expansion. I’m just kind of trying to make sense of where we are now that we’re in a different disease setting. Thanks.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Matt, Dave Chang again. Let me take that question. I don’t think it’s really changed in our thinking. Zach had made a comment in his prepared statement, we knew that as we started ALPHA-three study, we are going into a different clinical setting of the extremely low volume disease setting where the antigen target, which is really what triggers the cell expansion is at the lowest possible level that one can think about. So we had a very open minded approach about in that kind of setting what degree of cell expansion would be optimal to eradicate MRD positivity.

And the conclusion that we drew at the time is that the approach that we have made in the relapsed refractory setting. So these are the patients with the bulky disease where we felt cell expansion as well as persistence is really important. We cannot think the same way. And that was how the genesis of the ALPHA-three study starting with the three arm, not only testing FCA, but also testing FC. So, obviously at this point, we have some idea as we have previously communicated through the unplanned data analysis, MRD conversion being seen in the FC.

So at this point, really, let’s us stay tuned. I mean, we will know more in next six months.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics1: Makes sense. Thank you.

Conference Operator: Thank you. Our next question comes from Samantha Semenka with Citi. You may proceed.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Speak Can up a little bit? It’s coming out a little bit muffled.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics2: Oh, apologies. Is this better?

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: Yes.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics2: Perfect. So thank thank you for taking the question. I recall in this call earlier this month that there was a protocol amendment to close the FDA arm. And I’m wondering if that has been completed and as well as are you able to continue enrollment into the XT arm while that protocol amendment is underway? And I think the prior response to the question, you said that there was a defined period of MOD convert or MOD positivity where the patient could be eligible for the study and meaning if there’s any overlap with that window and some patients might be missing it and not be able to enroll in the study.

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: So sorry, Samantha, it was still quite muffled. Think I got the first part of your question, and I’ll answer that, and then maybe you can try to fix your connection and ask the second part because that one was a little harder to understand. The first question was around the status of enrollment as the operational implementation of the closure of the FCA arm is underway. So the patients are continuing to be screened for MRD, protocol amendment that enabled us to close the FCA arm earlier than anticipated is with IRBs currently. We expect those data protocol amendment to be approved in the next few days.

So we anticipate very little, if any, disruption to the operations of this trial as a result of this amendment. And then maybe you can refrift ask the second part again.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics: Yes. Hopefully you’re able to hear me now. Much

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: better, much better. Thank you.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics: Bluetooth headphones were causing some issues. So, yes, I think you answered most of the question. Just confirming that once this IRB approval comes through in a few days, all of the patients that were screened in the interim are still eligible to enroll into the FcRn?

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: Yes, absolutely.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics: Understood. Thanks very much for the question.

Conference Operator: Thank you. Our next question comes from Luca Aci with RBC Capital Markets. You may proceed.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics3: Oh, great. This is Shelby on for Luca, and thanks for taking the question. Maybe circling back on a prior question on enrollment, we appreciate that the death that you guys reported a couple weeks back was likely related to ALLO-six forty seven, which you’re obviously no longer pursuing. However, this is also the first time you’re reporting a death in the first line maintenance setting for a patient that was otherwise relatively stable post R CHOP versus I believe the other deaths that you reported in the past were in patients with much more refractory disease, like the three deaths reported in multiple myeloma. I guess the question is, is this event going to slow down enrollment materially, or do you think this is a nonevent for enrollment velocity?

Any color there, much appreciated. Thanks.

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: Thanks, Shelby. Good question and absolutely part of the analysis. When we wrote the study and then in the immediate wake of this unfortunate grade five event, we asked ourselves that very question. We discussed it with all of the external stakeholders like the DSMB, the steering committee, the FDA. And the consensus was really quite clear that these patients, you characterize them as relatively stable.

I think the data would strongly indicate that these patients have chemo refractory cancer. And we know from the MRD data that these patients are going to progress and likely to progress very soon. So the investigators, the patients who consider enrolling this trial, see themselves not as in remission and likely to never hear from their cancer again. They actually, I think, appropriately see their situation as extremely high risk and worthy of enrollment into a clinical trial. That said, a grade five event like the one that we observed is a significant moment in any clinical trial, this one included.

And that was what prompted us to take a look at the overall safety data as well as that MRD conversion data that we referred to. And at that point, we really had the confidence that moving forward with the Fc arm would deliver the appropriate benefit risk for the patients in this particular clinical setting. So all of us looked at the data and we all think that this, investigators included, is worth pursuing.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics3: Got it. Thanks.

Conference Operator: Thank you. Our next question comes from Asthika Gunwerting with Truist. You may proceed.

: Hey, guys. Thanks for taking the question. I probably want just jog my memory here a bit. And if I remember right, some of the earliest Selective data showed that early reconstitution of the patient’s T cells, but what correlated with poor response and that’s what rationalized the use of CD52 antibody back in the day. But that was also in the tumor setting as well as in a late line setting.

So to ask the question again, but more focused on endogenous T cell population is that early aligned setting and also post our CHOP. Does that change the dynamics here of what could predicate a poorer response? And then I have a quick follow-up.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Dai Cheng, let me give Zach a break and take question. In terms of the early CELLECTIS data, I think you are remembering it correct. I mean certainly, in the relapsed refractory setting, most of the data from CELLECTIS is coming from the ALL study that was carried out. There was definitely indication that adding anti CD52 antibody leads to a more prolonged cell expansion. Having said that, even with the Fc regimen, there always has been some degree of cell expansion and that’s always something that we have known.

So it’s really trying to thread the right needle that fits the clinical indication that we are going after. If we are going after bulky disease setting, I would have a lot of discomfort in limiting the lymphodepletion with Fc alone. But as we have said, MRD positive is a very unique clinical setting. One hand, it clearly foretells that the patient will have a disease recurrence. But on the other hand, the level of disease that’s in the patient’s body is not detectable by conventional PET CT scan.

It is at the molecular level disease burden, which is the objective of the ALPHA-three study trying to eradicate that in a minimal disease. So this is a lot different clinical setting and the kind of cell expansion or persistence that most people are thinking about that doesn’t really apply. And as I said, that always has been one of our hypothesis as we are embarking on ALPHA-three study.

: Thanks, David. And then the quick follow-up here is, when you talk about the MRD conversion rates early next year, would you also be in a position to give color on the mix of patients that came from community versus academic as well as those who are treated inpatient versus outpatient? Or would that be too early to comment on that? Thanks.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: I mean, certainly in terms of patient distribution, I don’t see any reason to withhold that information. It may be in a limited number of patients, I mean, because the futility analysis is based on 24 patients. So having said that caveat, I mean, are trying to make that communication as informative to you analysts as well as the investors.

Conference Operator: Thank you. Our next question comes from William Pickering with Bernstein. You may proceed.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics4: Hi, thank you for taking my question and congrats on the continued progress. For the interim analysis, are you able to share any of the quantitative criteria to run that such as minimum number of events or minimum duration of follow-up and how sensitive are those assumptions to or criteria to the observed MRD conversion rate that you’ll share early next year? Thank you.

Zachary Roberts, Executive Vice President of Research and Development and Chief Medical Officer, Allogene Therapeutics: William, this is Zach. So we don’t think that the MRD conversion rate that we intend to share is going to be terribly sensitive to some of those aspects that you highlighted. The protocol describes an MRD assessment at a specific time point. And so we collect that test at that time and then we analyze whether it’s positive or negative. And that’s the data that we intend to share.

: Thank you. Thank you.

Conference Operator: Our next question comes from Reni Benjamin with Citizens. You may proceed.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics5: Hey, good afternoon, Thanks for taking the questions. With three twenty nine, I guess I’d love to get a better understanding and additional color on how you picked the just the cyclophosphamide regimen. Know, and why not have maybe a three arm study with Fc, just cyclophosphamide, then no lymph depletion. So what’s leading you to this? And then as a follow-up, what kind of proof of concept data do you think you need to see in order to move the program forward, especially given other cell therapy players that have generated data in the autoimmune space?

Thank you.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Hi, Bren. David here. So let me take the first question about why we chose cyclophosphamide. In the autoimmune disease indication, I mean, we do believe that we have to think about a little bit differently when it comes to the benefit risk profile, especially the risk profile. Taking away fludarabine provides a lot of additional safety benefit.

And then second, cyclophosphamide as a chemotherapy agent is something that many rheumatologists are very comfortable with since it’s not often often gets used to treat severe lupus or other autoimmune disorders. And sort of embedded in your question is, is cyclophosphamide going to be enough? This one, I would sort of point you to the earlier studies that were published from Fred Hutch, where they have looked at a comparison of cyclophosphamide and cyclophosphamide and fludarabine. So what was very clear from that presentation was that cyclophosphamide alone is good enough to give the cell expansion. However, the durability of cell expansion is not as great.

Really the durability comes from by the addition of fludarabine. So for the autoimmune indications, really the objective is to achieve deep B cell depletion without prolonging it. So from that sense, we felt cyclophosphamide alone would be a much better fit for autoimmune indications.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics5: Got it. And just as you see that data, that proof of concept data, what are you looking for in order to kind of get that gono go decision, make that go no go?

David Chang, President and Chief Executive Officer, Allogene Therapeutics: I think ultimately, we will have to look at the clinical data, but leading to clinical data, there’s a lot of good indicators. After all, the objective of at least CD19 part of ALLO-three 29 is B cell depletion. So the degree of B cell depletion and more importantly, how the returning B cells, what are their phenotype. I think that those are very important information. And somewhat associated with that is disappearance of autoimmune antibodies.

And those are things that have consistently been observed with autologous CAR T that have been tested in the autoimmune indications. Certainly, they will give us a lot of information. And ultimately, as we follow those patients, their clinical response, whether they continue to require other anti autoimmune medications, whether their symptoms go away, I think all those things can be told relatively quickly.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics5: Got it. Thank you.

Conference Operator: Thank you. And our last question comes from Brian Jeng with JPMorgan. You may proceed.

Christine Casciano, Chief Corporate Affairs and Brand Strategy Officer, Allogene Therapeutics6: Hi, David. Thanks for taking our question this afternoon. I just want to follow-up on your bar for success in ELPH03 earlier. The 30% delta reference, I think you and Zach mentioned, they seem to be coming from the later line setting. I think the trials that you quoted, they’re coming from the later line trials.

So how is this bar, the 30% conversion bar, a fair translation in this consolidation line that you’re shooting for after R CHOP or R CHIP? Shouldn’t we expect a higher bar when you’re looking into earlier line? Thank you.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: Yes, Brian, great question. Frankly, the information that I cited is really coming from the second line randomized study that was conducted with Yes carta and Briansi. And, I think this is, in my view, in a very good reference point. As long as you equate MRD conversion to the CR that you can detect with a PETCT, as long as you accept that premise, I think sort of the analogy or the reference point about what bar would be sufficient to get to statistically significant as well as clinically meaningful benefit on the EFS and PFS. I think this is a really good reference point for ones to think about.

And certainly, the ultimate test is the outcome of alpha-three study.

Conference Operator: Thank you. That concludes our question and answer session. I would like to turn the conference back over to management for any additional comments.

David Chang, President and Chief Executive Officer, Allogene Therapeutics: All right. Thank you. As we reflect on this past quarter, it’s clear that Allogene is entering a new chapter, one defined by operational clarity and growing clinical momentum. With ALPHA-three, we made a decisive move to streamline the study, enhancing patient safety while preserving the trials scientific integrity and simplifying the regulatory path. With ALLO-three 16, we’ve reached alignment with FDA on the pivotal trial path, an important step for what we believe is the most advanced allogeneic CAR T program in solid tumors.

And with ALLO-three 29, we’ve officially launched resolution study, our first foray into autoimmune disease with a study that could redefine how cell therapy is applied in immune mediated conditions. These are not incremental steps. They are true inflection points with each one accelerating our path towards a future where allogeneic CAR T is not only possible but the standard of care. Our upcoming milestones are value driving catalysts that have the potential to reshape the landscape of cell therapy and define Allogene’s leadership in the field. Thank you for your continued interest and support.

We look forward to connecting with many of you in upcoming meetings and events in the month ahead. Operator, you may now disconnect.

Conference Operator: 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.

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