Fate Therapeutics Inc (FATE) Q4 2018 Earnings Conference Call Transcript

FATE earnings call for the period ending December 31, 2018.

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Fate Therapeutics Inc  (NASDAQ:FATE)
Q4 2018 Earnings Conference Call
March 05, 2019, 5:00 p.m. ET

Contents:

Prepared Remarks:

Operator

Welcome to the Fate Therapeutics Fourth Quarter 2018 Financial Results Conference Call. At this time, all participants are in listen-only mode. This call is being webcast live on the Investors & Media section of Fate's website at fatetherapeutics.com. As a reminder, today's call is being recorded.

I would now like to introduce Scott Wolchko, President and CEO of Fate Therapeutics.

J. Scott Wolchko -- Chief Executive Officer and President

Thank you. Good afternoon, and thanks everyone for joining us for the Fate Therapeutics fourth quarter 2018 financial results call. Shortly after 4:00 p.m. Eastern Time today, we issued a press release with these results, which can be found on the Investors & Media section of our website under Press Releases. In addition, our Form 10-K for the year ended December 31, 2018, was filed shortly thereafter and can be found on the Investors & Media section of our website under Financial Information.

Before we begin, I would like to remind everyone that except for statements of historical facts, the statements made by management and responses to questions on this conference call are forward-looking statements under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that can cause actual results to differ materially from those in such forward-looking statements.

Please see the forward-looking statement disclaimer on the company's earnings press release issued after the close of market today, as well as the risk factors in the company's SEC filings included in our form 10-K for the year ended December 31, 2018, that was filed with the SEC today. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made, as facts and circumstances underlying these forward-looking statements may change. Except as required by law, Fate Therapeutics disclaims any obligation to update these forward-looking statements to reflect future information, events or circumstances.

Joining me on the call today is Dr. Dan Shoemaker, our Chief Scientific Officer. Dan joined Fate Therapeutics over 10 years ago in February 2009. Dan and I are also joined by Dr. Bob Valamehr, our Chief Development Officer. Bob joined Fate Therapeutics over nine years ago in January 2010. I joined the company at its founding in September 2007.

The founding of Fate Therapeutics came on the heels of a groundbreaking publication in 2006 by Dr. Shinya Yamanaka and his team at Kyoto University. Demonstrating that adult mouse fibroblasts could be reprogrammed in vitro using four genes to form mouse embryonic like stem cells. This discovery that mature cells can be induced to become pluripotent stem cells with the potential to self-renew and to differentiate into all cell types of the body was awarded the Nobel Prize in 2012. Since its beginning, Fate Therapeutics has focused on building a proprietary induced pluripotent stem cell or iPSC product platform with therapeutic intent. Two of our scientific founders, Dr. Rudolf Jaenisch, Professor of Biology at MIT and a founding member of the Whitehead Institute for Biomedical Research; and Dr. Sheng Ding, formerly of The Scripps Research Institute and currently Senior Investigator at the Gladstone Institute also made pioneering discoveries in the iPSC field. Dr. Jaenisch demonstrated the generation of human induced pluripotent stem cells, and Dr. Ding discovered certain small molecules that greatly enhance the efficiency of cellular reprogramming and the quality of reprogram cells. Our scientists developed footprint free methods of cellular reprogramming that maintain genomic stability. We apply various nuclease and non-nuclease mediated genome engineering technologies to modify iPSCs. We isolated and characterized single iPSCs for clonal selection, and we've built clonal master iPSC lines for use as a renewable source in deriving various cell types of the body.

In 2015, Fate formally embarked on a bold vision of using master iPSC lines to produce universal off-the-shelf cell-based cancer immunotherapies. Through the use of master iPSC lines, we foresaw the potential to create cell products that are uniformly engineered, extensively characterized, produced at significant scale in a cost effective manner and delivered on-demand to treat more patients. We formed collaborations with the University of Minnesota led by doctors Dan Kaufman and Jeffrey Miller for the development of iPS-derived NK cell products; and with Memorial Sloan Kettering, led by Dr. Michel Sadelain for the development of iPS-derived T-cell products.

Today, our iPSC product platform is industry leading, and is supported by an intellectual property portfolio of over 100 issued patents and 100 pending patent applications. We have built a deep pipeline of highly differentiated off-the-shelf NK cell and T-cell cancer immunotherapies with the hope of delivering transformational change in patient outcomes. We believe our iPSC product platform overcomes many of the fundamental challenges that limit autologous cell therapy and that are rapidly confounding allogeneic cell therapy for the treatment of cancer.

Our decade long commitment with significant contributions along the way from countless others in the field of iPSC research has now resulted in a first-ever milestone. In February 2019, the first patient in the US was treated with an iPS-derived cell product FT500. We have reached a new beginning, opening the door to a new era in the development of cell products.

FT500 is a universal off-the-shelf NK cell cancer immunotherapy derived from a clonal master iPSC line. In preparation for the clinical investigation of FT500, 100 of doses of FT500 were manufactured in a single GMP campaign. Each dose was cryopreserved in an infusion ready bag and bags were shipped to certain clinical sites including UCSD Moores Cancer Center and MD Anderson Cancer Center. FT500 is now available off-the-shelf at these centers for thaw and infusion to patients.

The landmark clinical trial of FT500 is being conducted as a two-arm study in up to 64 patients for the treatment of advanced solid tumors. The study is designed to assess the safety and efficacy of multiple doses of FT500 over multiple dosing cycles as a monotherapy in patients that are candidates for salvage therapy, and as a combination with either nivolumab, pembrolizumab or atezolizumab in patients that have failed or have confirmed disease progression on checkpoint inhibitor therapy. We believe combining FT500 with checkpoint inhibitor therapy is a novel therapeutic strategy with compelling biological rationale. Despite the impressive response rates observed with checkpoint inhibitors, the majority of patients do not respond and many responders relapse. One common mechanism of failure to respond or disease relapse is associated with tumor cell mutations in genes critical for antigen presentation. Importantly, these loss-of-function mutations can be identified in advance of treatment. We believe FT500 has the potential to rescue non-responders with loss-of-function mutations.

In preclinical studies, FT500 has displayed multiple mechanisms by which it may promote anti-tumor activity in patients that are non-responsive to checkpoint inhibitor therapy. In addition to this being the first clinical trial in the US of an iPS-derived cell therapy. This clinical trial of FT500 is also one of the first studies where multiple doses of a universal cell therapy are being administered over multiple dosing cycles. Numerous biomarker readouts are being carefully measured. These include the PK/PD profile of FT500, changes in the host immune system including key cytokine levels and the adaptive immune response, and changes in the tumor microenvironment including immune cell infiltration and tumor cell gene expression. We look to share initial biomarker and clinical data of FT500 at scientific conferences as data emerges throughout 2019.

In January 2019, we submitted an IND application to the FDA for FT516. The second product candidate emerging from our iPSC product platform. FT516 is a universal off-the-shelf targeted NK cell product candidate derived from a clonal master iPSC line engineered to express a high-affinity non-cleavable CD16 Fc receptor. CD16 is an activating receptor naturally expressed on NK cells that mediates antibody-dependent cellular cytotoxicity or ADCC, a potent anti-tumor mechanism by which NK cells recognize, bind and kill antibody coated cancer cells. There are two variance of CD16 and numerous clinical studies with FDA approved tumor targeting antibodies, including those for the treatment of hematologic malignancies as well as solid tumors have demonstrated that patients with a high-affinity variant 158V have improved clinical outcomes. However, only about 15% of humans are homozygous for 158V.

The novel CD16 Fc receptor expressed by FT516 has been modified to contain the high-affinity 158V variant to augment its binding to tumor targeted antibodies. Our therapeutic objective with FT516 is to improve patient outcomes by delivering high-affinity CD16 engagement to patients undergoing treatment with monoclonal antibody therapy, including the 85% of patients that inherently have low-affinity CD16.

In February 2019, the FDA allowed our FT516 IND application and authorized us to begin human clinical investigation of FT516. Our clinical trial of FT516 is expected to be an open-label repeat dose clinical trial in up to 99 patients for the treatment of relapsed refractory hematologic malignancies. The clinical trials intended to assess the safety and efficacy of multiple doses of FT516 over multiple dosing cycles across three treatment arms, as a monotherapy in subjects with AML, in combination with rituximab in patients with lymphoma, and in combination with elotuzumab in subjects with multiple myeloma. To our knowledge FT516 is the first ever engineered iPS-derived cell therapy cleared for clinical investigation worldwide.

At the upcoming AACR Annual Meeting, we expect to present new preclinical data of FT516 in combination with monoclonal antibody therapy for the treatment of hematologic malignancies. We expect to open the FT516 study for patient enrollment in mid-2019. In addition to FT500 and FT516, our time to innovation in applying our proprietary iPSC product platform has been rapid and we have built a robust pipeline of universal off-the-shelf NK cell and T-cell product candidates that are moving toward 2019 IND submissions.

FT596 is the company's first universal off-the-shelf CAR NK cell product candidate, which is designed to target CD19-expressing malignancies. While multiple groups are just advancing second generation approaches using autologous and allogeneic CAR T-cells to target CD19 into first in human studies. We believe our therapeutic approach with FT596 is highly differentiated on multiple fronts and has the potential to better these approaches. FT596 incorporates three unique functional elements; FT596 is dual targeted expressing both a CD19-targeted CAR and a high-affinity non-cleavable CD16 Fc receptor for combination with a broad spectrum of tumor targeted antibodies. We believe dual antigen targeting has the potential to drive deeper and more durable responses and mitigate antigen escape. As proof-of-concept, we have shown that FT596 in combination with rituximab completely eliminated CD19 positive and CD19 negative tumor cells in a co-culture cellular cytotoxicity assay. Additionally, FT596 incorporates a novel IL-15 receptor fusion to enhance persistence, independent of systemic cytokine support.

Finally, the CAR construct itself is also novel and specifically designed for NK cell biology. In preclinical studies using ovarian cancer xenograft model, our collaborator Dan Kaufman has shown that iPS-derived CAR NK cells markedly inhibit tumor growth and significantly prolong survival as compared to iPS-derived NK cells containing a CAR construct commonly used with T-cell therapy. We are scheduled to present new preclinical data for FT596 at the upcoming AACR Annual Meeting. We expect to submit an IND application to the FDA in mid-2019 for the clinical investigation of FT596.

I'm also pleased to announce that at the upcoming AACR Annual Meeting, the company's first off-the-shelf TCR-less CAR T-cell product candidate FT819 will be featured in a late-breaking abstract. We believe that one of the most powerful advantages in applying our iPSC product platform is the ability to engineer, characterize, and select single clones for the creation of clonal master engineered iPSC lines, which can be used as a renewable source for mass producing homogeneous cell products. This revolutionary paradigm overcome significant challenges that limit both patient and donor derived cell therapy, where heterogeneous populations of primary cells are repeatedly sourced, engineered, expanded, and characterized with each manufacturing run, resulting in significant batch-to-batch and cell-to-cell variability that can affect safety and efficacy. In contrast, FT819 is derived from a clonal master engineered iPSC line that includes site-specific integration of a novel 1XX CAR targeting C19 into the T-cell receptor alpha constant locus, which is intended to regulate CAR expression for enhanced safety and efficacy and completely eliminate T-cell receptor expression to prevent GvHD.

At ASH, we showcased new in vivo data from our collaboration with Memorial Sloan Kettering led by Dr. Michel Sadelain, demonstrating that the control of tumor progression with FT19(ph)is comparable to that with peripheral blood CAR T-cells in a mouse model of acute lymphoblastic leukemia. At the upcoming AACR Annual Meeting, we intend to highlight the unique value in single cell engineering clonal selection and renewable production of off-the-shelf CAR T-cells as compared to allogeneic approaches to CAR T-cell therapy that rely on donor-by-donor cell sourcing and batch-to-batch engineering of large cell populations. As our iPS-derived cell product candidates move into clinical development, I continue to be very pleased with the clinical execution and encouraging patient data for our ongoing allogeneic cell therapy programs, FT-NK100 or FATE-NK100 and ProTmune.

In November 2018 at SITC, we presented initial dose escalation clinical data of FATE-NK100 from 15 subjects across three Phase I clinical trials; VOYAGE for the treatment of relapsed refractory AML; APOLLO for recurrent ovarian cancer; and DIMENSION for advanced solid tumors. All three clinical studies enrolled subjects having progressive disease, which had failed to be effectively managed by approved therapies. As of an October 28, 2018, data cutoff, no FATE-NK100 related dose limiting toxicities were reported, and no events of cytokine release syndrome, neurotoxicity or GvHD were reported. Anti-tumor activity was observed in seven of the 15 subjects with a single dose of FATE-NK100.

Last month, at the Transplantation and Cellular Therapy Meetings in Houston, we presented an update on an additional two patients from DIMENSION that had been treated, but had not yet reached one month follow-up at the time of the October 2018 data cutoff. As of January 2018, 2019 data cutoff, an additional patient with renal cell carcinoma was treated with a single infusion of FATE-NK100, achieved stable disease and had ongoing disease control for 4.1 months. And a second additional patient with Stage IV ocular melanoma having been non-responsive to both nivo plus ate(ph), as well as pembro was treated with a single infusion of FATE-NK100 and achieved over 20% reduction in target lesion size. This patient was subsequently treated with a second infusion of FATE-NK100, reimaging continued to demonstrate reduction in target lesion size with a 61% reduction in standardized uptake value suggestive of ongoing disease response. We are encouraged by these initial clinical data, FATE-NK100 was well tolerated and displayed an initial safety profile that appears differentiated from T-cell therapy.

In addition, FATE-NK100 showed evidence of clinical activity as a single dose monotherapy. Importantly, a second dose of FATE-NK100 was well tolerated and showed persistence in four patients, establishing proof-of-concept for a multi-dose therapeutic strategy.

At this time, the VOYAGE study in AML and the APOLLO study in recurrent ovarian cancer, each are open for enrollment as an investigator-initiated study at the University of Minnesota, Masonic Cancer Center. The DIMENSION study in advanced solid tumors is open for enrollment at two centers with an additional two centers currently prepping for initiation. In the DIMENSION study, we continue to establish precedent for and gain learning's from FATE-NK100 in combination with trastuzumab and cetuximab, and we look to provide an update for these combination arms in 2019.

Turning to ProTmune. In December 2018 at ASH, we presented one-year follow-up data from the Phase I stage of our PROTECT study of ProTmune, our next generation allogeneic hematopoietic cell graft for patients with hematologic malignancies, undergoing hematopoietic cell transplant. As of November 26, 2018, data cutoff, with a median time on study of 516 days, there were no ProTmune related SAEs reported by investigators, no events of graft failure, and no events of leukemia relapse. Since allogeneic transplant is performed with curative intent to long-term clinical outcomes that are critical for patients with life-threatening hematologic malignancies are disease free survival and survival without cancer relapse and without moderate or severe graft-versus-host disease. At one-year follow-up, five of seven subjects remained alive and leukemia free, and three of seven subjects were alive and free from leukemia relapse and moderate-to-severe chronic graft-versus-host disease. In comparison, our contemporary date assessment by CIBMTR from over 5,000 patients and 120 transplant centers suggest that at one-year following conventional matched unrelated donor transplant disease free survival is only about 50%, and only one in four patients are alive, disease free and without significant GvHD. We continue to see strong momentum in subject enrollment in the ongoing randomized and double-blind Phase II stage of PROTECT. We expect to complete enrollment in mid-2019 with data available on the primary and secondary endpoints in 2020.

Finally, I would like to highlight that in January 2019, we expanded our corporate headquarters in San Diego and initiated build-out of in-house GMP manufacture for clinical supply of our off-the-shelf iPS-derived cell product candidates. The modular design is comprised of two iC(ph)suites for iPSC expansion and differentiation, each of which feeds into a central ipharm(ph)suite for product expansion. The modular setup is customized for use of master iPSC lines to support the mass production of multiple product candidates in parallel. We expect to initiate in-house manufacture for clinical supply of our off-the-shelf iPS-derived cell product candidates in the fall of 2019, with initial capacity to produce thousands of doses per year.

Turning to our financial results for the fourth quarter ended December 31, 2018, Fate Therapeutics incurred a net loss of $16 million or $0.25 per common share as compared to a net loss of $12.5 million or $0.29 per common share for the same period last year. Revenue was $1.7 million for the fourth quarter of 2018, compared to $1 million for the fourth quarter of 2017. Revenue was derived from the company's collaborations with Ono Pharmaceutical and Juno Therapeutics.

Research and development expenses for the fourth quarter of 2018 were $14.1 million compared to $9.9 million for the same period last year. The increase in our R&D expenses was primarily attributable to an increase in expenses associated with the preclinical and clinical development of the company's product pipeline and employee compensation including share-based compensation associated with growth in headcount to support the advancement of the company's product pipeline.

G&A expenses for the fourth quarter of 2018 were $4.3 million compared to $3.4 million for the same period last year. The increase in our G&A expenses was primarily attributable to an increase in employee compensation, including share-based compensation and professional fees. Total operating expenses were $18.4 million for the fourth quarter of 2018, after adjusting for non-cash stock-based compensation expense of approximately $1.8 million and quarterly cash research payments from Juno of $500,000. Our total adjusted operating expenses were $16.1 million for the fourth quarter of 2018.

At the end of the fourth quarter of 2018, cash, cash equivalents and short-term investments were $201 million. Common stock outstanding was 64.7 million shares and preferred convertible stock outstanding was 2.8 million shares, each of which is convertible into five shares of common stock under certain conditions.

And with that, I would like to open the call up to any questions.

Questions and Answers:

Operator

Thank you. (Operator Instructions) Our first question comes from Ted Tenthoff with Piper Jaffray. Your line is now open.

Ted Tenthoff -- Piper Jaffray -- Analyst

Great. Thank you. Can you hear me, OK?

J. Scott Wolchko -- Chief Executive Officer and President

Yes.

Ted Tenthoff -- Piper Jaffray -- Analyst

Great. So, firstly, I love the history lesson upfront. I mean, this is amazing to see the progress you guys have made over that timeframe and really who you've been working with, and that's a testament to the progress. So, congratulations on dosing of first patient with the iPSC-derived cell therapy for cancer. One quick housekeeping and then one on the trial. I just want to double check. I know that you have the partnership with to Juno. Are you still recognizing any of that upfront amortization, I think it was supposed to run through May of 2019. So, I had (inaudible) yet, but just want to see is there still any of that in there. And then, secondly, with respect to dosing in the study, what is sort of the dosing sequence. You dose a patient, wait a certain period of time, dose the next patient. How does that kind of work through with the Phase I? Thanks.

J. Scott Wolchko -- Chief Executive Officer and President

Sure. So, housekeeping on revenue recognition and this will also generally applied to Ono. There was -- in both collaborations there's obviously an upfront, and we're being paid research and development fees. We essentially amortize the upfront and the upfront is being recognized over the term of the collaboration, or the baseline term of the collaboration, which in both cases is estimated to be four years. And their research fees are being recognized as performed. So with respect to the Juno collaboration in the fourth quarter as well as the first quarter of '19, we will recognize two pieces of revenue, $500,000 associated with the amortization over the collaboration of the upfront plus $500,000 in research and development payments, so about $1 million a quarter. The Juno collaboration does end in May of 2019. Ono's revenue pattern will be recognized in a similar way, there was $10 million upfront, that will be recognized over four years. In addition, Ono is paying us about $5 million a year in research funding, and so that will be recognized as performed.

Ted Tenthoff -- Piper Jaffray -- Analyst

Thank you.

J. Scott Wolchko -- Chief Executive Officer and President

Sure. With respect to -- and it should not vary too much quarter-to-quarter. With respect to sequence of dosing of the patients in the FT500 trial. Yes. So we are obviously in a dose escalation period, there are two arms of the study, there is a monotherapy arm, there's a checkpoint inhibitor arm. The monotherapy arm goes first, in the first at the first dose level and we are able to essentially treat the patients on a following schedule. The first patient can be treated, let's call it on day one, and then a second and third patient can be treated beginning two weeks later. There is a safety assessment that occurs on day 28, and if safe, you can proceed to the next dose cohort.

Ted Tenthoff -- Piper Jaffray -- Analyst

That's very, very helpful. Looking forward to getting some of that data in AACR and throughout the year. Thanks for the time.

J. Scott Wolchko -- Chief Executive Officer and President

Thanks.

Hello?

Operator

Our next question comes from Robyn Karnauskas with Citi. Your line is now open.

Kripa Devarakonda -- Citigroup -- Analyst

Hey, guys. Thank you so much for taking this question. This is Kripa on for Robyn. So about build out of the GMP manufacturing facility, I have a couple of questions. I know you mentioned, Scott, that you could make thousands initially. I was just wondering how you expect it to grow as you expand out further and how many different products can you manufacture simultaneously. And also when do you expect to switch over to product made in this facility for your trials?

J. Scott Wolchko -- Chief Executive Officer and President

Sorry, what was the last question?

Kripa Devarakonda -- Citigroup -- Analyst

When do you expect to switch over to the product -- you said that you would start making product for your clinical trials in fall of 2019. So when do you think you can actually start using the product that you make in your GMP facility in your clinical trials?

J. Scott Wolchko -- Chief Executive Officer and President

Sure. So let's go backwards. So the product that we plan to manufacture this year in our facility, we plan to use this year in clinical studies. Just to be very clear about that. So, we think with launch, we will be able to treat patients with product manufactured at Fate Therapeutics this year, that is certainly an objective well within our reach. We do have obviously manufacturing partners that are manufacturing FT500, FT516, and lined up for FT596. We have a strong relationship with MCT and the University of Minnesota, and they've been very successful at manufacturing at least initial batches of product for clinical study. With respect to how many products we can manufacture simultaneously. As I mentioned, this setup is very customized for using master cell lines to create universal cell products. And we can very likely stagger the way we manufacture product to potentially do three to four products in parallel.

Kripa Devarakonda -- Citigroup -- Analyst

Great. Thank you. And if I may sneak in one more question about your NK100 program. Now that you have two iPSC-based products having cleared IND, has your thinking or strategy changed toward the FATE-NK100 program in any way?

J. Scott Wolchko -- Chief Executive Officer and President

No. I mean, we are -- the studies are -- the three NK100 studies are all open, all enrolling patients. We have said before and we stand firm that those studies we will continue to run. They are important studies. We're learning a tremendous amount of that with respect to NK cell biology, as well as conditioning regimens, multiple doses and both hematologic malignancies, as well as solid tumors in combination with monoclonal antibody therapy. So, I think we are absolutely learning a tremendous amount. We remain committed to the FATE-NK100 studies. That said, if you look at the clinical footprint of the products that we're developing with respect to iPS-derived NK cell products, whether it'd be 500, 516 or 596, I suspect that almost every single patient that is eligible for enrollment in an NK100 study would qualify for enrollment in one of those three product candidates. In fact, as you probably picked up, FT516, while not -- the clinical study is not yet open for enrollment, FT516 does include a monotherapy arm where we can give multiple doses over multiple cycles to AML patients.

Kripa Devarakonda -- Citigroup -- Analyst

Great. Thank you. And one quick housekeeping question. Have you given any -- I'm sorry, I apologize if you've already talked about it, but cash runway, can you provide us some color?

J. Scott Wolchko -- Chief Executive Officer and President

Yes. So, we've two -- we're slightly over $200 million in cash. As I went through, we're burning on a cash basis about $16 million a quarter. And so, I believe we have sufficient cash well into 2021.

Kripa Devarakonda -- Citigroup -- Analyst

Great. Thank you so much. I really appreciate you taking the questions.

J. Scott Wolchko -- Chief Executive Officer and President

Sure.

Operator

Thank you. And next question comes from Jim Birchenough of Wells Fargo. Your line is now open.

Yanan Zhu -- Wells Fargo -- Analyst

Hi. Thanks for taking the questions. This is Yanan in for Jim. So, the first question is how comparable are FT500 and the FATE-NK100 as NK cell therapeutics. And is there a reason to think that the iPSC-derived product might be superior?

J. Scott Wolchko -- Chief Executive Officer and President

Sure. I'm happy to take that question. Without denigrating NK100 in any way, NK100 is a donor-derived product. NK100, like all donor-derived products is challenged like all donor-derived products with a tremendous amount of heterogeneity from donor-to-donor from batch-to-batch manufacturing. And that is a limitation that exists with allogeneic cell therapy. And iPS-derived cell therapy approach is a clonal approach. You can literally select a single clone and race that single clone against other clones, as well as donor-derived products. You wind up with an incredibly potent homogeneous product that can be given in multiple doses to patients. So, I do not believe in any way, just this is a general statement, donor-derived cell therapy is comparable with an off-the-shelf approach.

Yanan Zhu -- Wells Fargo -- Analyst

Great. That's very helpful. And so, another question on the NK program, and then I have a follow-up on for the CAR T-cell program. So for FT516, you mentioned there -- the initial study will have combo with rituxan for example. So, just curious how to differentiate the effect of the combo versus rituxan alone?

J. Scott Wolchko -- Chief Executive Officer and President

To qualify for enrollment in that arm, they will have had to have failed rituxan.

Yanan Zhu -- Wells Fargo -- Analyst

Got it. Very helpful. And so, looking ahead for the first iPSC-derived CAR T product, would you expect FDA to take the same time as it did with the IND of FT500, or do you think the issue is addressed for the FT500 IND will be considered supportive of more rapid clearance of the iPSC-derived T-cell product? Thanks.

J. Scott Wolchko -- Chief Executive Officer and President

Yes. I think it's a good question. I would tell you just based on our interactions and our understanding of obviously the interactions we've been having with the FDA. Our belief is that part of the time period that it took to get FT500 cleared, which we filed in July of 2018 and cleared late November of 2018, a big piece of that was familiarizing the FDA with the platform itself. The nature of reprogramming cell, selecting clones, creating master cell banks, qualifying master cell banks, and then ultimately differentiating to a product candidate. I would say, the process of creating master cell banks, whether it's an NK cell or a T-cell is fundamentally the same. And even a significant piece of the differentiation protocol, when you go from a master iPSC line to an NK cell or a T-cell, there are about 10 days to 15 days of the first part of the creation of the products that are almost exactly similar. So, I think there are tremendous amounts of learning's that we've been able to leverage in creating NK cells and then following that with T-cells. And I do think we will have a lot of benefit from the work we're doing on our master iPS cell platform and with respect to creating off-the-shelf NK cell products as we look to file the first IND and clear that first IND with respect to an off-the-shelf T-cell product. So, I think there are a lot of synergies and a lot of learning's, and we benefit significantly from the work that we've done historically already in pioneering the first iPS-derived, in this case CAR T-cell product.

Yanan Zhu -- Wells Fargo -- Analyst

Got it. Great. Thanks, Scott.

Operator

Thank you. And our next question comes from Biren Amin with Jefferies. Your line is now open.

Biren Amin -- Jefferies -- Analyst

Yes. Hi, guys. Thanks for taking my questions. Hey, Scott, on the 516 program, it seems you're dosing up to 900 million cells, whereas in the 500 trial, you're dosing up to 300 million cells. So, what's the rationale that drives the higher dose level for 516?

J. Scott Wolchko -- Chief Executive Officer and President

Yes. It was -- when we put in the IND for FT500, we started with two dose levels. It's not intended to necessarily be restricted to two dose levels, and we certainly can go up to the higher dose level with FT500, like we are with FT516. Keep in mind, when we put in FT500, it was the first iPS-derived cell therapy IND put in front of the FDA. We took a conservative approach with the protocol that we submitted initially with that IND application to the FDA. When based on the feedback and getting it cleared, when we put the FT516 IND in, we included a traditional three dose cohort or three-by-three study design. And I suspect quite frankly with FT500, as we advance through these first dose cohorts, we very likely will amend to include a third and higher dose cohort that matches FT516.

Biren Amin -- Jefferies -- Analyst

And then, on the 516 program, you're also -- I think administering short course IL-2 after lymphodepletion, is there a similar requirement with the 500 program. And what's the scientific rationale in administering short course IL-2 with these cells? Thanks.

J. Scott Wolchko -- Chief Executive Officer and President

Sure. So, obviously, cytokine support can be important and the literature in the space and clinical experience is a bit confounding. There certainly have been studies where NK cells have been given with cytokine support, for instance IL-2. There's been other studies where NK cells have been given without cytokine support and specifically IL-2. And so, I don't think there is necessarily any compelling rationale one way or the other yet that's been firmly established in the clinic with respect to cytokine support. Interestingly enough, as you know, as you condition patients, there is -- there are obviously release of cytokines in the body that can provide support for adopted transfer of cell therapy. And so, one of the learning's we're getting with respect to NK100, for instance, we have three different conditioning regimens that are being used across the three NK100 studies. So, we are carefully looking, for instance, at the cytokines that are released simply through conditioning and how they support NK cells. One of the specific things that we're interested with respect to FT500 is bridging both innate and adaptive immunity, and we are a bit sensitive based on the data that we're seeing with respect to administering IL-2, what that potentially could do to T regulatory cells.

Biren Amin -- Jefferies -- Analyst

Okay. And then, I guess on 596 preclinically, have you compared this program to CD28 or 4-1BB CAR, and how does it compare on potency and persistence today?

J. Scott Wolchko -- Chief Executive Officer and President

Yes. So, we've done that head-to-head in NK cell land, and we are in the process of doing that with respect to comparing CAR NK cell versus CAR T-cell.

Biren Amin -- Jefferies -- Analyst

Okay. And then, just maybe a last question, on the 819, I think this is a CD8 T-cell driven program. So, do you believe, given its devoid of CD4 T-cells that that would impact long-term efficacy?

J. Scott Wolchko -- Chief Executive Officer and President

We have not seen any suggestion of that, including in, in vivo preclinical models.

Biren Amin -- Jefferies -- Analyst

Great. Thank you.

Operator

Thank you. Our next question comes from Do Kim with BMO Capital Markets. Your line is now open.

Neil -- BMO Capital Markets -- Analyst

Hi, guys. This is Neil(ph)I'm filling in for Do. I had a first question about FT500 and the first patient that was dosed. And I was wondering if you're able to give any background on the patient's cancer type and prior therapies they had prior to being dosed. And then as a follow-on to that, I just wanted to see if you could give us a little bit more clarity on how you're thinking about proceeding into the combination portion of the study. Is there a cutoff in terms of the number of patients that you need to treat with monotherapy prior to initiating a portion?

J. Scott Wolchko -- Chief Executive Officer and President

Yes. Certainly. So, I'm not going to disclose any patient data profiles with respect to FT500 at this time. With respect to how we transition into the combination arm, I mentioned that there are three patients at a dose level. The monotherapy arm goes first, there's a 14-day delay between the first and second patient, there's a -- the second and third patient can theoretically go in simultaneously; and there's a 28-day safety assessment. As soon as you clear the 28-day safety assessment in the monotherapy arm, both arms are open and operate independently. So, the start of the combination arm trails, absent the DLT by 45 days.

Neil -- BMO Capital Markets -- Analyst

Great. Thank you. That's helpful. And then, one other quick question. I think you had mentioned when the first patient you expect to be dosed for FT516. And then as a follow-on, are you using the same clinical sites as you are for FT500?

J. Scott Wolchko -- Chief Executive Officer and President

We've not disclosed that yet.

Neil -- BMO Capital Markets -- Analyst

Okay. Thank you very much. Appreciate it.

J. Scott Wolchko -- Chief Executive Officer and President

Sure.

Operator

Thank you. Our next question comes from Dana(ph)with SVB Leerink. Your line is now open.

Dana -- SVB Leerink -- Analyst

Hello. Thank you for the question. A couple of them. The first on the trial design for FT500 and FT516. You mentioned for FT500, you have some hypotheses on how you can select patients based on their type of resistance to an anti-PD-1. And I wonder when you'll start to collect that biomarker data, and whether you're collecting a biomarker data for FT516, and if we'll see some of that cuts in the initial data coming out?

J. Scott Wolchko -- Chief Executive Officer and President

The answer is, yes. We're collecting that biomarker from the get go. We actually think it's really important. We're not, to be clear, in reaching necessarily for these loss-of-function mutations to start, but we are collecting all that data from the get go and it will be certainly part of the data assessments that we conduct and the information that we share on the patient analyses. We'll be doing very similar types of assessments with respect to the FT516 analyses in the arms in those studies. We -- as you probably know, Fate Therapeutics recently was fortunate enough to hire Sarah Cooley. She has a tremendous -- she is from the University of Minnesota. She has, years and years of experience working with NK cells and running NK cell studies and prides herself in absolutely developing the best biomarker analyses that can be done in cancer -- cell-based cancer immunotherapy studies. So, we're absolutely ramping and committed to these types of analyses.

Dana -- SVB Leerink -- Analyst

Great. Thank you. Now, maybe a very theoretical question. When you have master cell line and clone for FT500 and FT16, can you use that clone indefinitely or at some point do you have to switch and pick a new clone and a new master line?

J. Scott Wolchko -- Chief Executive Officer and President

So far, our experience in conversations with the FDA, our intent is to use these indefinitely. We don't have any reason to think we can't use them indefinitely. And in fact, we are potentially excited about using one master iPS cell line to create a master cell line from a -- for a different product. That is one of the unique advantages of what we do. We can, for instance, take a master cell line for FT500 and use that as a basis for creating a master cell line for FT516 as an example. We did not do that in that particular case. But, as we think about adding more and more functionality, and second, third, fourth edits, that type of approach becomes very attractive, especially if you've already qualified a master cell bank.

Dana -- SVB Leerink -- Analyst

Very helpful. Thank you. One last question, for your cytokine support, have you considered using any of the next generation cytokines of less toxicity, either the IL-15 or the IL-2 instead of other (inaudible)?

J. Scott Wolchko -- Chief Executive Officer and President

Yes. I mean, we've looked at this certainly and we continue to look at this. I mean, the one thing that we are thinking about obviously is this is a platform, this is a first of kind approach. And certainly we want to combine with -- use conditioning regimens and combined with agents initially that have a well-established profile. And so, I absolutely think there's potential there, but it's not some place we look to start.

Dana -- SVB Leerink -- Analyst

Great. Thank you very much.

Operator

Thank you. Our next question comes from Matt Biegler with Oppenheimer. Your line is now open.

Matt Biegler -- Oppenheimer -- Analyst

Hi, guys. Thanks for letting me sneak in some questions and congrats on the milestones. So, I wanted to ask about some of the emerging translational data from NK100. And I recognize, this is still very early. But have you seen any evidence that NK100 is expanding in the peripheral blood. And maybe a more theoretical follow-up is, do you believe that NK cell expansion is critical to achieving objective responses?

J. Scott Wolchko -- Chief Executive Officer and President

Yes. So, I mean, we're looking at this and we're not -- I wouldn't say we have seen, for instance, aggressive NK cell expansion, like you're probably accustomed to seeing in T-cell land. So, we have certainly looked at persistence of NK cells, which is different than -- which is potentially very different than expansion. But one of the things that we're excited about and trying to -- is trying to achieve essentially a drug-like profile for our cell therapy. So when we think of, for instance, where we are going with cell therapy and what we are interested in pursuing from a therapeutic strategy perspective, it is being able to create multiple doses including with other agents -- in combination with other agents over an extended period of time. I actually believe the best way to accomplish that is by giving multiple doses as opposed to giving a single dose and letting that single dose itself, then be sort of exposed to essentially whatever is going on in the body over that following period of time. So, for instance, a dose that you give and you intend to give it one time, certainly has the potential to -- of an autologous cell, certainly has the potential to expand or persist, but is going to be exposed and essentially be influenced by what's going on in the body a month later, two months later, three months later. We believe coming in with a wave of prime healthy cells and creating a PK/PD profile over a period of time is a better way to drive more durable and deeper responses.

Dan Shoemaker -- Chief Scientific Officer

And Matt, one thing to add. This is Dan. In the four patients that received two doses in the 100 study, the persistence profile, the second dose was similar and in some cases a little bit longer than the first dose. So, that was our first encouraging experience with a multi-dose format that bodes well for -- as we start dosing patients with FT500 and FT516.

Matt Biegler -- Oppenheimer -- Analyst

Okay. That makes sense. And maybe a quick question on the strategy for FT516. So there was some updated NK data from Dr. Miller's group presented at Tandem or I guess it's called TCT Meeting, few weeks ago. They had some notable complete remissions in heavily pretreated follicular lymphomas, but less activity in DLBCL and myeloma. And I'm just wondering if you guys look at this data and in any way, it can maybe help you as you kind of hone the indications for the upcoming trial?

J. Scott Wolchko -- Chief Executive Officer and President

Yes. I mean, I think it's interesting. We're certainly encouraged by that data, because we're big believers in ADCC. I think, again, back to the earlier question of a donor-derived approach versus an off-the-shelf approach, I think, there's fundamentally some pretty significant differences in FT516 versus a donor-derived NK cell therapy, even if that NK cell therapy might have high expression of CD16. As we talked about, only 15% of patients have a high-affinity variant of CD16. So, I'm not -- I didn't look at the data that closely, but I wasn't aware, for instance, whether they segregated the database on whether the donor had a high versus a low variant. Obviously, with FT516, every single patient, we can bring a high-affinity experience to. In addition, one of the challenges with donor-derived cell therapy and CD16 in particular, CD16, while an activating receptor, CD16 can cleave and does cleave in the body upon engagement. And so with FT516, we've locked the receptor on. Essentially, we have a mutation whereby the receptor not only is a high-affinity variant, but is non-cleavable. And so, therefore, this is synthetic biology, if you will, with respect to FT516. So certainly, we're out there scanning what's going on in the industry with respect to adoptive transfer of cell therapies, including engineered cell therapies. We're learning from that, including our own NK100 experience, but fundamentally believe that the products that we are building and will continue to build will have fundamentally enhanced functionality that cannot be recapitulated through just donor-derived cell therapy.

Matt Biegler -- Oppenheimer -- Analyst

Okay. Great. Thanks. Congrats to you, and congrats to Dr. Cooley on her new role.

J. Scott Wolchko -- Chief Executive Officer and President

Thanks.

Operator

Thank you. (Operator Instructions) Our next question comes from Reni Benjamin with Raymond James. Your line is now open.

Reni Benjamin -- Raymond James -- Analyst

Hi. Thanks for taking the questions and congratulations on the progress. Scott, can you talk a little bit about the new licensing agreement that you signed regarding the BCMA targets and just kind of when -- how you see that development occurring and when you might be in the clinic?

J. Scott Wolchko -- Chief Executive Officer and President

Sure. I think, we signed this agreement with the group over in Germany that has developed and has done a lot of work in developing novel binding domains to BCMA as a target. In fact, they have done a lot of work in comparing some of their -- the ways that they bind BCMA, for instance, compared to other binding domains. And so, we were very intrigued by the data that we had seen from them. We are assessing those binding domains in our hands. We're not through that analysis yet. But this is a program that we are very interested in, including the potential of combining, like we're doing for instance with FT596, combining a CAR BCMA with a CD16 receptor to be able to hit two targets at once. We're at or I would say earlier stages of that preclinical assessment, but certainly it is program that we -- with data and with success we could potentially look to accelerate, given we already are developing FT538.

Reni Benjamin -- Raymond James -- Analyst

And given that there are other players that are looking at BCMA constructs of T-cells, do you guys favor maybe more the NK cell approach or are you evaluating both?

J. Scott Wolchko -- Chief Executive Officer and President

We're definitely evaluating both. I've said this I think before, maybe in certain circles, but allogeneic transplant to our knowledge and our belief is the only curative therapy out there. T-cells are given NK cells are given. There's other cells that are obviously given as part of a graft. And so, we think NK cells and T-cells play a pretty foundational role and very likely a complementary and synergistic role in attacking cancer. And so, from our perspective, part of our objective and where we think we are clearly positioned, we're the only company that can bring together NK-cell and T-cell therapy in an off-the-shelf manner.

Reni Benjamin -- Raymond James -- Analyst

Got it. And then, just one final one for me. Can you talk a little bit about the source of the iPSC cells for your master cell bank. And have you had any experience with how these master cells look from different sources, or are they all pretty much equivalent? Thanks.

J. Scott Wolchko -- Chief Executive Officer and President

No. They're definitely not -- I wouldn't say they're equivalent by any means necessarily. And yes, I'm not going to get into sort of trade secrets about how we source cells and how we select donors and all that kind of good stuff. But back to the fundamentals, no two donors are created equal. We absolutely assess the different donors from which we originally source cells, and we have an entire sort of history of efficiently reprogramming cells from various donors. And so, yes, I mean, there is a lot of trade secrets and knowledge there that goes into how do you select the right donor with respect to creating your master cell line.

Reni Benjamin -- Raymond James -- Analyst

Great. Thank you.

J. Scott Wolchko -- Chief Executive Officer and President

Sure.

Operator

Thank you. And I'm showing no further questions in the queue at this time. I'd like to turn the call back over the Scott Wolchko for any closing remarks.

J. Scott Wolchko -- Chief Executive Officer and President

Great. Thank you very much, everyone, for participating in today's call. And we look forward to speaking with you in next couple of weeks. See you at AACR most likely. So, take care.

Operator

Ladies and gentlemen, thank you for your participation in today's conference. This does conclude your program, and you may all disconnect. Everyone, have a great day.

Duration: 61 minutes

Call participants:

J. Scott Wolchko -- Chief Executive Officer and President

Ted Tenthoff -- Piper Jaffray -- Analyst

Kripa Devarakonda -- Citigroup -- Analyst

Yanan Zhu -- Wells Fargo -- Analyst

Biren Amin -- Jefferies -- Analyst

Neil -- BMO Capital Markets -- Analyst

Dana -- SVB Leerink -- Analyst

Matt Biegler -- Oppenheimer -- Analyst

Dan Shoemaker -- Chief Scientific Officer

Reni Benjamin -- Raymond James -- Analyst

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