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Arqule Inc  (NASDAQ:ARQL)
Q1 2019 Earnings Call
May. 01, 2019, 9:00 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Good day, ladies and gentlemen and welcome to the ArQule's First Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder, this conference maybe recorded.

I would now like to introduce your host for today's conference, Marc Schegerin, Chief Financial Officer. Sir, please begin.

Marc Schegerin -- Chief Financial Officer, Head of Strategy and Treasurer

Thank you very much. Good morning, everyone. Welcome to the ArQule investor conference call reviewing operational and financial results for the first quarter of 2019. I'm Marc Schegerin, Chief Financial Officer and Head of Strategy at ArQule. This morning, we issued a press release that reported results for the first fiscal quarter ended March 31, 2019. This release is available on our website at arqule.com. Leading the call today will be Paolo Pucci, Chief Executive Officer of ArQule. Also present from the Company are Peter Lawrence, President and COO; and Brian Schwartz, Head of R&D.

Before we begin, please note that we will be making forward-looking statements as defined in the Private Securities Litigation Act of 1995. These statements will include, among other things, projections regarding the timing of key events related to ArQule's proprietary pipeline and financial guidance for 2019. Actual results may differ materially from those projected in the forward-looking statements due to numerous risks and uncertainties that exist in ArQule's operations, development efforts and the business environment, including those factors discussed in our reports on Forms 10-Q and 10-K and other documents filed with the Securities and Exchange Commission. The forward-looking statements contained in this call represent the judgment of ArQule as of today. ArQule disclaims any intent or obligation to update any forward-looking statements, except to the extent required by law. We will provide an opportunity for Q&A at the end of this call.

I'd now like to introduce the CEO of ArQule, Paolo Pucci.

Paolo Pucci -- Chief Executive Officer

Marc, thank you very much. Thank you all for joining us this morning for our first quarter call of the year. I would start by saying that during Q1, we have continued to implement our operational plans just on track or better than expected. And we would like to give you a little bit of an update of those -- that implementation.

So although the work we have done, I will provide a couple of key updates upfront. In terms of call organization I will provide an introduction. Then Brian will go in deep in the medical clinical development update. Marc will go in depth in the financials. And then, we'll open it up for questions.

Given that we have a number of new investors that we have welcomed in the last few months, just a very brief table setting introduction. We are following -- we are pursuing right now three strategies that define our efforts for each of the three fully owned pipeline candidates that we are pursuing. In BTK mutated B-cell malignancies with ARQ 531, we aim to be first and best-in-class for this new approach of reversible dual BTK inhibition. In rare overgrowth spectrum disorders with miransertib, we aim to be first and best-in-class for Proteus syndrome and PROS as well. In hormone-sensitive solid tumors with ARQ 751, we aim to be first follower and next-generation in the AKT class.

Now, the two updates upfront. We'll focus on ARQ 531 and our focus then with a few words on miransertib rare diseases. The trial that we are conducting for ARQ 531 in B-cell malignancies, which is a phase 1 dose setting safety and signal generation particularly in this later stage has progressed very well. No issues whatsoever in recruiting and we are very, very happy with the way we're working with sites that are participating in this trial.

Briefly on safety, to set the table on the safety side, as we announced previously, we expanded the cohort number 7, that was 65 milligram QD and that cohort has now been completed for safety. You will recall that in that cohort, we observed our very first in the trial dose limiting toxicity in the form of a rash and that was one of the first three patients enrolled. As per the three by three protocol design, we expanded that cohort and we have recently communicated that that cohort subsequently cleared. And so having cleared cohort 7 for safety, we initiated the cohort number 8 and we are already well on the way to dose the six patients that are foreseen to be enrolled in cohort number 8 at the dosage of 75 milligram QD. I am happy also to report that thus far no additional DLTs have been observed in any other patient at any dose level.

Relative to clinical activity, I also have some incremental news to share. We continue to monitor approximately six patients that have been dose escalated from 45 milligram to 65 milligram QD, which was possible as soon as the 65 milligram QD cleared for safety and we are also following approximately six patients that have been enrolled and are valuable still in cohort 7 at 65 milligram QD.

Previously, we have reported two PRs in these trials and I'm very happy to tell you that both patients continue on the trial and the confirmed responders. Important is to remember that the first C481S patients that was a responder at 88 % shrinkage in the first scan, which we announced in the Q4 '18 call just a couple of months ago has since been rescanned and it is a confirmed responder. So we are beginning to see a little bit of durability as well in these responders. Brian will give more detail in his part.

We are very busy collecting right now and compiling data for our mid-June EHA presentation that will occur in Amsterdam at the European Hematology Congress. The dose dependent effect on clinical activity that we began to detail with our ASH presentation of late last year and the data that at that point in time only included cohort 6 and not cohort 7, which is the one where we assessed more extensively the highest dose deployed hold and until we can say that as we continue to move higher, we see a dose dependent effect on clinical activity. And therefore, we're highly confident that we will show significant incremental clinical activity from cohort 7 in the target patient population in the CLL C481S mutated patients in our presentation at EHA. To my knowledge, there will probably be the largest number of C481S mutated patients CLL that will be presented for a long, long time, I think the only such presentation -- there is no such a presentation before the one we are going to give in EHA.

So relative to the data floor and to EHA, let me conclude by saying that the abstract that is made public recently for EHA was filed in February and it does not include any of the data that we have discussed since during our Q4 call for 2018 and during this call. So you have to consider that the EHA data set will be very rich because it will include all the data that we will be able to gather, compile and QA between mid-February and early June. So that concludes my introductory remark for 531, could not be more positive about this drug. I've been 30 years in this business and I have rarely seen drugs perform in this way in a phase 1 trial.

The second update, I'd like to report that although we're fully absorbed by the efforts in 531, current effort, but as well the effort to plan for the next stage trials, we in fact will have an advisory committee at EHA to discuss that with opinion leaders from around the world. We have also been focusing on our rare disease strategy with miransertib. Those patients are in dire need of therapeutic alternatives, particularly the Proteus patients because they have none other than surgery. And I think that is the need in that rare -- ultra-rare patient population, it's felt also by our collaborators in the IRBs. And in fact, there were a couple of very speedy reviews by IRBs of sites that will be involved in our registrational program for Proteus and PROS. And so I am happy to report that we have received already the first couple conditional IRB approvals and that puts us closer to initiating those registrational trials. Brian and I have recently spent a week in Europe visiting the top opinion leaders for CLL as well as some of the key sites for rare disease with miransertib and we have seen a lot of enthusiasm in wanting to participate in both programs.

So Brian now will give you a more detailed overview of how the clinical development programs are proceeding. Please, Brian.

Brian Schwartz -- Chief Medical Officer

Thank you, Paolo. Let me start with ARQ 531, which is our potent and reversible dual inhibitor of both wild type and C481S mutated BTK. As a baseline, please recall that in the ASH poster, we reported anti-tumor activity with reduction in tumor burden observed in 9 out of 12 patients. Let me -- sorry, 9 out of 20 patients.

Let me comment on how the clinical activity is evolving. Beginning with two patients that were previously reported as responders, patient number 1, a follicular lymphoma who began in cohort 1 at 5 milligram QD was dose escalated to 15 milligram and then to 45 milligram remains on therapy for 24 cycles, that's almost two years, and continues as a PR. Our second responder, which we announced in our last call, patient 27, a CLL C481S-mutant patient who was first evaluable scan in cohort 7 at 65 milligram QD received a second scan and continues as a confirmed PR. Regarding cohort 7 at the 65 milligram QD dose, a total of six CLL SLL patients with documented C481S mutation remain evaluable and have received at least one post-treatment scan and disease assessment. This includes the one patient already disclosed with the confirmed PR.

We plan to provide a more detailed update at EHA, which we expect will include more extensive safety data as well as significant incremental clinical activity data. In total, 10 patients were enrolled in cohort 7, the six evaluable CLL patients just described, two patients, one MCL and one CLL patient were not evaluable for clinical activity. One DLBCL and another patient of particular interest, the first patient recruited with greatest transformation who remains on study.

Regarding the safety and dose escalation since ASH, ARQ 531 continues to be well tolerated. As previously reported, cohort 7 was expanded to a total of 10 patients per protocol and subsequently cleared for safety. Consequently, we have been able to do two things, escalate to 65 milligram QD five out of the six eligible patients that were on therapy at 45 milligram QD, initiate dosing of an additional six patients in cohort 8 at 75 milligram QD of which four have already been dosed.

Let me move on to the pharmacokinetic data. This continues to be predictable with the mean plasma half-life, which supports QD dosing. The pharmacodynamic biomarkers in cohort 7 continue to demonstrate profound BTK reduction of 100%. In summary, we are pleased with the progress we continue to make with this trial and specifically the dose dependent clinical activity that is emerging in the 65 milligram QD dose in heavily pre-treated C481S-mutant CLL patients.

Lastly, let me just go through the data -- the new data that we are going to present at EHA. This will include three groupings of patients. The first group will include safety and some additional clinical activity data of approximately six patients who are dosed as -- who could be dose escalated from 45 milligram to 65 milligram QD. Safety and clinical activity data of 10 patients that have been enrolled in cohort 7 at 65 milligram QD included in this group are six CLL patients with a C481S mutation who remain evaluable for response. And finally, initial safety data from the patients that are being enrolled in cohort 8 at 75 milligrams.

With that, let me move on to miransertib in rare overgrowth spectrum disorders. Miransertib is a potent and selective AKT inhibitor. Our objective is to be the first and best-in-class AKT inhibitor in Proteus syndrome and PROS family of rare overgrowth diseases. This family of diseases is an ultra-rare, very heterogeneous and patients currently suffer from a dismal quality of life and early mortality. No systemic therapies have been approved for this patient population and the only current therapy is surgery.

We have two main updates for this program. Firstly, we have received our first IRB conditional approvals and hope to enroll our first patient in the upcoming months. Our collaborators at Gemelli Hospital in Rome will be presenting an oral presentation at the European Society of Human Genetic Conference in Gothenburg in mid-June, where we will highlight primarily our PROS patients.

The registration program will consist of one protocol divided into three cohorts. The first cohort will focus on Proteus syndrome, which will enroll at least 10 patients. The second cohort will focus on PROS family of overgrowth disorders and will enroll at least 20 patients. And the third group will be a signal generation arm that will include patients from either group that do not qualify for cohorts 1 and 2, but otherwise deemed eligible to benefit from therapy. These cohorts will be open-label and the primary endpoint will be response rate driven based on objective measurable criteria. We are currently enrolling additional sites and expect to begin dosing as soon as possible.

With regards to our other programs. For ARQ 751, the next-generation AKT inhibitor, the signal generation work in oncology continues in the phase 1b study and we plan to present data from this study in the second half of the year. For derazantinib, our FGFR inhibitor, our partners Basilea and Sinovant continue to implement their plans respectively for the registrational phase 2 trial in intrahepatic cholangiocarcinoma and initiate the clinical efforts in China.

With that summary, I would like to turn it over to Marc to go over the financials.

Marc Schegerin -- Chief Financial Officer, Head of Strategy and Treasurer

Thank you, Brian. The Company reported a net loss of $10.3 million or $0.09 per share for the quarter ended March 31, 2019 compared with a net loss of $6.5 million or $0.07 per share for the quarter ended March 31, 2018. As of March 31st of this year, the Company had a total of approximately $92.2 million in cash, cash equivalents and marketable securities. Revenues in Q1 2019 were $1.3 million compared with revenues of $4.1 million in Q1 2018. Research and Development revenue this quarter was comprised of $1.1 million of reimbursable clinical trial costs from our Sinovant licensing agreement and $0.2 million of revenue from reimbursable costs associated with our Basilea licensing agreement.

Research and development expense for Q1 2019 was $7.4 million compared with $5.8 million for Q1 2018. The $1.6 million increase was primarily due to higher outsourced pre-clinical, clinical and product development costs of $1.2 million and $0.4 million for labor related and other research and development costs. General and administrative expense was $4.3 million in Q1 2019 compared with $2.4 million in Q1 2018. The $1.9 million increase was primarily due to higher labor related costs consisting of $1.3 million of non-recurring executive retirement costs and $0.5 million of stock-based compensation costs.

Our 2019 guidance has not changed. We continue to expect to end the year with between $60 million and $63 million in cash, cash equivalents and marketable securities. Revenues to range between $3 million and $5 million and a net loss ranging between $40 million and $43 million, which translates to a net loss per share of $0.37 to $0.39.

With that, I'd like to turn the call over to Q&A. Operator, please feel free to open the line for questions.

Questions and Answers:

Operator

Thank you. (Operator Instructions) Our first question comes from Jonathan Chang of SVB Leerink. Your line is open.

David Ruch -- SVB Leerink -- Analyst

Hi, guys. This is David Ruch on for Jonathan. Thanks for taking my questions and congratulations on the progress.

Paolo Pucci -- Chief Executive Officer

Good morning. Thank you.

David Ruch -- SVB Leerink -- Analyst

First question, could you help set investor expectations for the EHA data in terms of the activity signals you'll be looking for? And how are you thinking about efficacy benchmarks in the fast-to-market patient population?

Paolo Pucci -- Chief Executive Officer

So the -- for the efficacy, overall, I go back to what I just say. We're highly confident that we will show a significantly incremental clinical activity, particularly from cohort 7, where -- which is the highest dose that we have tested so far. If you exclude cohort 8, but cohort 8 is just beginning. So that's what we are expecting to show. We're highly confident that the clinical activity will be very interesting for investors as well as for the scientific community, frankly. I know that this is an investors' call, but we're talking about fairly high science as well, the two things go hand-in-hand obviously and they'll connect at EHA. So we're looking forward to see everybody at EHA. We are also preserving the data set for EHA because the totality of the data set we believe will be highly informative for both investors and the scientific community. As far as the benchmark, it's not so clear to talk about benchmarks. Jonathan has recently published one where we -- some work in his newest release, where he quotes two opinion leaders. If I remember well that we're talking about benchmarks. Those benches are sensible. If the benchmarks depend on what we'll do next, so let's talk about what we might do next. We may pursue second and third line CLL-mutated patients. Second line as we described before would be patients that have received ibrutinib progress with the mutation, have seen venetoclax, received venetoclax or a combination of thereof and were intolerant or third line, there will be patients that have received venetoclax or combination of thereof, if the mutation in that progressed. So in that case, the natural benchmark would be whatever will have been seen in the previous line of therapy, right, that will be venetoclax. And the management will be somewhat below in terms of response rate what venetoclax has shown in that setting. Obviously, you have to differentiate for side-effects, you have to differentiate for these patients be more tested in a way and spent, then they will be into second line et cetera, et cetera. If you are instead looking at what we could be doing in Richter transformation. If we were to find a signal in Richter transformation, well, that's a much easier benchmark because essentially most studies don't even -- ongoing, don't even include those patients, which are considered among the hardest to treat and the one for which there is the -- yes, the therapeutic need. So that's as much as we can say. Obviously, as our plans for the next steps get formed up, as we have discussion with regulatory authorities, we will be more informative about the benchmarks we'll pursue, which will ultimately be enshrined in a clinical trial to pursue.

David Ruch -- SVB Leerink -- Analyst

Great. Thank you. And just one more from me. You've previously guided to cohort 8 as being the final dose cohort for the phase 1 study. Could you just talk a little bit more about why you believe this is the case and your reasons for confidence that you're closing in on a recommended phase 2 dose? Thank you.

Paolo Pucci -- Chief Executive Officer

So first, I need to correct your statement. Sorry. It's not the final cohort, it's the last cohort that we are dosing. So not final, but last cohort that we are dosing. We had -- we could go to cohort 8 because cohort 7 cleared for safety and the number of other boxes checked. We will observe these patients. We are very young in the observation of these patients, cohort 8, I have to be very specific, has not been clear for safety yet. Hopefully, it will be cleared. Once that cohort is cleared, then we will look at the totality of our data and see what we do, if that is going to be the last cohort or otherwise. At a minimum if you assume that cohort 8 gets clear for safety, it will help us identify a range -- a dose range. And so your question gives me the opportunity to clarify something. Cohort 7 at 65 milligram QD has already shown to be safe and has already shown to be efficacious and has already shown that 65 milligram is very much in line to what we had expected. Obviously, if we were to present, although the cohort 7 patients that Brian detailed, more efficacy along the lines of the one patient that we have already declared, the C481S patient that we declared to be a respondor a couple of months ago, that has been rescanned and continues a responder, well, then cohort 7 dosage would look a very viable one to bring forward. But we are -- as I said, the data is developing. What we see so far is developing positively and I have to look at the data in its totality. We will begin to do that at EHA.

David Ruch -- SVB Leerink -- Analyst

Great. Thank you.

Paolo Pucci -- Chief Executive Officer

You're welcome.

Operator

Thank you. And our next question comes from Gregory Renza of RBC Capital Markets. Your line is open.

Gregory Renza -- RBC Capital Markets -- Analyst

Hey guys, thanks for taking my question and congratulations on all the progress.

Paolo Pucci -- Chief Executive Officer

Thank you, Greg.

Gregory Renza -- RBC Capital Markets -- Analyst

Yeah, Paolo. I just wanted to get your view on how you are thinking about business development with respect to 531 as the cards are turning over there, but also as you comprehend your fuller portfolio, miransertib, et cetera, and how have your views essentially been informed over time as the data directionally is heading in the right direction? Thank you.

Paolo Pucci -- Chief Executive Officer

So Greg, excellent question. As we have shown in the past, we're always open for business for business development. Peter who is joining us today on the call, he's always by the phone and he takes the calls and we discuss with people. We are just a little bit selective in that, we have one guiding principle that the partners we might end up working with need to help us to do incrementally more than we would have been able to do on our own, considering our capital resources as well as importantly our organizational resources. If you follow that principle, then 751 in hormone-sensitive tumor is likely the draw where we would most benefit from embracing a partner. Miransertib in rare diseases is actually something that we believe we could pursue on our own. And if anything, a partner would come and play at the later time when one will want to expand geographically as much as possible commercial reach for the drug. 531, we are just fine doing on our own for now. As you can see, we've made good progress. We have a partner, quite frankly, we have a partner in the James at Ohio State. They've helped us guide us through the last four years, I would say, because this is a pre-clinical project that we share with them for -- since four years ago. And they have provided to us that hematoncology expertise that we don't really have in our DNA because we have worked mostly during our 30 years of career on solid tumors. So a partner for 531 would have to be somebody that brings additional hematoncology expertise and would allow us to expand dramatically if the EHA data begins to give that sense, the program. But for now, we -- so in that framework, Peter takes the calls that come in. But for now, we are counting on our own forces. Our own organization, which however small has proven to be effective in the past and our own capital resources that quite frankly right now are sufficient to the operational plans I have in front of me for this year and the very early part of next. I hope that informs -- that gives you an answer of at least what the mindset is. Obviously, I cannot go into more specifics.

Gregory Renza -- RBC Capital Markets -- Analyst

That's great. That's very helpful. I really appreciate that. And just one last quick one on the miransertib program. Just to put a finer point -- I know it is somewhat of an extended, but rapid, the timeline if you will on the potential enrollment and developing the time on drug. Just curious with respect to that signal generation cohort, would that be something that would see faster enrollment just as by nature of the filtering and exclusion of patients to find in the first registrational cohorts? And would that -- we potentially see data from that first? And maybe just more generally, how you would think about the data disclosures certainly in these open-label trials as those progress? Thank you.

Paolo Pucci -- Chief Executive Officer

Brian will answer that.

Brian Schwartz -- Chief Medical Officer

I think you bring up a really good point. See, in our discussions with the agencies because of the large heterogeneity of the disease and the fact that they wanted a very hard endpoint, we would be excluding potentially a large number of patients that could benefit. So the FDA asked us almost to take each patient as a single case study, so that once the drug gets approved, please god, physicians will be able to try and match up different baseline signs and symptoms to follow with the drug. So for example in that expanded cohort, we would look at multiple endpoints and be able to help the physician in that expanded group look for specific endpoints to assess drug efficacy. In addition, quality of life as you know is also really important and pain and other softer measurements and that expanded cohort will give us the ability to pool the Proteus, the PROS and the expansion code and get sufficient data to evaluate quality of life with the standard quality of life tools. So it's really two-fold to sort of pickup all the heterogeneous groups that don't qualify for a hard measurement and then to try and get as much data on safety and quality of life as we could.

Paolo Pucci -- Chief Executive Officer

And as far as signal generations, we are still open for business, although even -- more selectively with our compassionate use program. We know that if there is a family with a child affected by this disorder, somewhere in the interior of Brazil, it's highly unlikely, and we have one as a matter of fact, or in the mountains of Peru and we have another one there as well, it's hard for us to ever reach them with the clinical trials, even with the arm 3. And we believe we have an obligation to do the best we can if there is a sponsor physician reach those patients with some hope through our miransertib. So we are still open for business for that -- for -- and that will also continue to generate hopefully important signals for these -- for the use of miransertib, Proteus and PROS.

Gregory Renza -- RBC Capital Markets -- Analyst

Great. Really appreciate it and I look forward to EHA.

Paolo Pucci -- Chief Executive Officer

I as well. See you there.

Operator

Thank you. And our next question comes from Chad Messer of Needham and Company. Your line is open.

Chad Messer -- Needham and Company -- Analyst

Great. Good morning and thanks for taking my question. (Multiple Speakers) Yeah. Very excited for EHA this year.

Paolo Pucci -- Chief Executive Officer

Chad, the data has -- if you look at our our old -- our presentations, we presented 531 3 times, all of them are congresses last year. I think you started with ACR, went to EHA and went to ASH. Then we gave one update only and then it's unnatural for us to go to EHA. And we're confident that the data will continue to look incremental. There is another month and a half of data we need to collect. The phase 1 trial, obviously, so that it's important. But yeah, we are excited about going to EHA as well, Chad. But sorry for that, let's go on with your question, please.

Chad Messer -- Needham and Company -- Analyst

Yeah. I was just wondering for the one patient, the responder with the C481S mutation. You said was a confirmed CR, I was just wondering, if you can disclose whether that response was deepening or is that something I'm going to have to wait for Amsterdam for?

Paolo Pucci -- Chief Executive Officer

Yeah. It will be in the presentation. We wanted to disclose that basis because obviously haven't disclosed that as a response -- as a responder that I think it's only fair that we all saw update on the status of that responder having disclosed that patient already. If he has been non-confirmed responder, we would have -- we will update it just as well because we think it's fair to do so, given that the information on that patient was out, turned out to be a responder. More details we'll provide in the presentation.

Chad Messer -- Needham and Company -- Analyst

Okay. Great. And then -- and just on miransertib...

Paolo Pucci -- Chief Executive Officer

Brian, you want to add anything?

Brian Schwartz -- Chief Medical Officer

Yeah. No, Chad, I mean, just to remind everyone, in our last call, we said there was a reduction in 88% of the size of that patient's lymph nodes and that continues to be in the same type of range.

Chad Messer -- Needham and Company -- Analyst

Okay, great. And then just on miransertib, you commented that you've got some additional sites you're working with there. What is the target number of sites for that and what's the sort of geographical spread?

Brian Schwartz -- Chief Medical Officer

So the geographical spread is US-focused because they have a network of hospitals and then a number of countries in Europe and Latin America and really focused where there are centers of excellence treating, for example, in Italy, in Rome, in France, in Dijon, in Spain around Barcelona. So to focus on the centers of excellence and then to draw on the experience in the US of the vascular anomaly geneticists, that have -- of forming a consortium and pretty much all the big pediatric hospitals in the US.

Chad Messer -- Needham and Company -- Analyst

Okay.

Paolo Pucci -- Chief Executive Officer

And Brian and I, Chad, as we're saying, we were in Europe for about 10 days for 531 and for miransertib. I had to say 531 is fairly self-explanatory to everybody. You go to a top CLL opinion leader in Italy, Germany or France, you show the data, they get it, no problem. It's easy to understand strategy. It's a very exciting scientific endeavor for them, given that they're kind of tired working with the third or fourth irreversible inhibitor and they're more interested in, OK, what comes after dose. And that's the dual inhibitors. For miransertib, it's a little bit more mixed because some sites really fitted very well to the endeavor that we have in front of us. Some other sites, where Brian and I were very hopeful, didn't fit nearly as well as we had hoped because they were mostly surgery -- sites for surgery. And it turns out that some of those sites might have the patients, but we will have to organize a referral system so that those patients could get treated. Because oftentimes, the sites where the surgeons are perform don't have the extended team that would care for a patient holistically in a clinical trial. So in some sites, we have work to do. It's still a little bit earlier to give a specific number of sites, but I would that no fewer than...

Brian Schwartz -- Chief Medical Officer

15 sites. Yeah.

Paolo Pucci -- Chief Executive Officer

Yeah. So no fewer than 15 to be precise. Right now, it will be the answer.

Chad Messer -- Needham and Company -- Analyst

Okay, great. Thank you.

Paolo Pucci -- Chief Executive Officer

But Chad, they might be spread because you have three sites in Italy, two sites in Australia, one site in Peru, one site in in Brazil. So it's a significant logistical endeavor that we have in front of us. I don't want to sugarcoat.

Chad Messer -- Needham and Company -- Analyst

All right. Great. Thanks, guys.

Paolo Pucci -- Chief Executive Officer

You're welcome.

Operator

Thank you. (Operator Instructions) Our next question comes from George Zavoico of B.Riley FBR. Your line is open.

George Zavoico -- B. Riley FBR -- Analyst

Hi. Thank you. Good morning, everyone. Thanks for the updated color, Brian. So you mentioned -- first question was about 531. You mentioned that you've got 100% BTK reduction, I guess, in cohort 7. So obviously, in cohort 8, you've got it as well. Are you thinking perhaps the duration of 100% reduction in activity will add to efficacy or is there some sort of pharmacokinetic limit that you think will be sufficient for optimal efficacy?

Brian Schwartz -- Chief Medical Officer

I think George as we've mentioned before, we look at three separate things, our PK, which we've exceeded now at the 65 milligram comfortably that we know -- that based on the pre-clinical models we work. The second thing is we always wanted to make sure that we got a 100% BTK knockdown. And the assay, we've always said the assay has a little bit of variability. In this last cohort, it's very strong the knockdown, but we saw good knockdown from a few cohorts earlier as well. But this one is looking as complete knockdown. I think the third piece, which will guide the dosing now is the efficacy and that will go through with everyone around EHA.

Paolo Pucci -- Chief Executive Officer

Another rationale for cohort 8 is purely clinical. And it is in the reminder we gave people today about having recruited and being treating the first Richter transformation patients. We are well aware and so are the sites that we -- site trial that we work with that we're tackling a monster there. With the transformation, it's a very bad condition for which there is not much available these days. And you can imagine that it's worthwhile prudently and within reason for us to trying to get to a dose that might help us not only address the more common B-cell malignancies that are treated by these kind of inhibitors, but also those where the -- there's been failures. And the drug was selected among a number of drugs that we had as candidate for IND four years ago together with Dr. Byrd at Ohio State to have a profile in terms of kinase inhibition profile that might have utility for those kind of harder to treat malignancies and now we are beginning to test that profile at doses that we judge are becoming relevant.

George Zavoico -- B. Riley FBR -- Analyst

That leads to my second question about Richter's transformation. You have one patient in so far with that condition. What are your plans or what are the hurdles you have to reach and cross over to be able to expand into more of Richter's patients? And would that be an expansion of the current trial? I imagine it would be.

Brian Schwartz -- Chief Medical Officer

So as you guys are aware, as soon as we get to the recommended phase 2 dose, we'll expand into a number of cohorts. Based on OSU's published data in cancer discovery, we saw efficacy in Richter's -- in a Richter's model, so we always wanted to test it. We were lucky enough to get a Richter's transformation patient in the phase 1 dose escalation portion and we'll share that data with you. But you're right, George, the hurdle for Richter's transformation is relatively low in even the first or second line setting and it could be a potential fast-to-market strategy as the survival is really short, the progression-free survival is really short in the dead patient population. So it's another potential fast-to-market opportunity behind our lead opportunity, the C481S-mutant group.

George Zavoico -- B. Riley FBR -- Analyst

And I imagine that Richter's patient failed ibrutinib or it was second line or third line?

Brian Schwartz -- Chief Medical Officer

So he transformed, he was on a number of therapies, including ibrutinib for his CLL and then transformed and received R-CHOP and then progressed and then came on to the study.

Paolo Pucci -- Chief Executive Officer

So that gives me the opportunity to say that although we are positive on the data, right now, as of today, as of this minute, as it does is developing. And our update today faithfully reflects what we have seen up to today. We remain here as well with some challenges and one of the challenge is that the patients that are being recruited in the trial, being a phase 1 trial, are still relatively heavily (inaudible). So we are probably, as I said in calls before, we are seeing -- any safety signal that we are seeing needs to be put in the context of those patients being spent physically through a number of previous therapies and being fit forwards and such lines. And any efficacy that we're seeing also need to be seen on the light -- in the light of the drug having to overcome a greater hurdle to show efficacy that we would normally have to overcome in a properly recruited trial with very strict inclusion criterias. But it's an opportunity for signal generation as well and if the drug is stronger, he will come through.

George Zavoico -- B. Riley FBR -- Analyst

Thank you for that. Very heavily pre-treated patient clearly. And my final question, quick question. For the miransertib cohort 1, 2, what is the age range that you're enrolling patients at? How low you're going in age, how young?

Brian Schwartz -- Chief Medical Officer

So for Proteus syndrome, it's 2 to 18 because based on the NIH data, that's when the growth of the CCTNs have been well-documented. And then for PROS disease, it's 2 to 30 because that is based on the PROS studies conducted before.

George Zavoico -- B. Riley FBR -- Analyst

Okay, great. Thank you very much for all that. Thank you.

Paolo Pucci -- Chief Executive Officer

You're welcome, George. Take care.

Operator

Thank you. Thank you. And our next question comes from Hartaj Singh of Oppenheimer. Your line is open.

Hartaj Singh -- Oppenheimer -- Analyst

Great. Thank you for the question. I really appreciate it. Apologize if you might -- thanks, Paul, Brian, all. Just -- you might have addressed these questions earlier, so I apologize. One is Paul, Brian, I know that post ASH, we talked about -- you had the first scan done, you had nine patients at that time of significant tumor shrinkage. You're planning on the second scan in the second quarter. Can you just walk us through a little bit of just how -- sort of how that works, how many more patients you're scanning in that second quarter, how much more duration you're seeing and what portion of that will make it into EHA or all of it? And then I just got a follow up question on just -- which I was thinking about in terms of the dose expansion.

Paolo Pucci -- Chief Executive Officer

So we have indeed updated, but let me repeat for everybody. Cohort 7 specifically at 65 milligram QD, and I'm reading from my script, the total six CLL SLL patients all with C481S mutation remain available and they have received at least one post-treatment scan and disease assessment. This includes already the confirmed PR and that's as much detail as we've provided today in our script, Hartaj. So -- go ahead, Brian.

Brian Schwartz -- Chief Medical Officer

So in addition to those six, Hartaj, we will present -- the entire cohort will incorporate the Richter's patient, another DLBCL and MCL and the patient who we declared to have the DLT. In addition to that, the patients who were on 45 milligram that we presented at ASH who have been dose increased and will all have received the disease assessment, we're now scanning the long-term patients every six months. So some of the really long-term patients may miss the scan between -- I think there's only a risk of one, every other one will have at least another scan in the data set. But the majority will receive at least one scan.

Paolo Pucci -- Chief Executive Officer

And as in the past, whatever we will -- have been able to QA by the time of the presentation, we will present. What will have not been QAed, we will not present.

Hartaj Singh -- Oppenheimer -- Analyst

Great. No, that's fantastic. I mean, EHA and ASH are going to be both very exciting this year for you. The second question I had was just in terms of -- I think at ASH, you had also given some colour around the number of prior therapies. I mean, you were seeing very heavily pre-treated patients, seven lines I believe the CLL, four lines with lymphoma and then you had also talked about maybe how you could address about getting to a third line kind of setting. Is that something that you look to do in the dose expansion that you could stratify patients by the line of that they're getting a treatment and so you'll get more data again to identify more fast-to-market opportunities?

Brian Schwartz -- Chief Medical Officer

I think there's two things, Hartaj. As we've moved through the trial, there are some patients that are now third line. So a little bit better patients have come in, but the vast majority are numerous lines of therapy. The second thing is -- there's two things, one, you would always like to get much earlier patients. But if our data in the latest setting looks really good, we would have to discuss with KOLs how we deal with prior lines of therapy and how we deal with when they got the prior -- how far away from ibrutinib the patients were treated, or acalabrutinib the patients were treated. But in -- our current feeling is that the earlier we can get the patients, the greater likelihood we're going to see higher clinical efficacy.

Hartaj Singh -- Oppenheimer -- Analyst

Yeah. No, that makes sense. Fine. Then just my last question is in terms of whether at EHA or at ASH, there has been some therapies more recently approved venetoclax, (inaudible) maybe you might even see some patients might be getting some form of cartee or something. Would you break that out so that we'll see aside from the regular standard of care, we could also see responses by patients who are on some of the more newer approved therapies? And again, thank you.

Brian Schwartz -- Chief Medical Officer

Yeah. Yeah. We will be able to say some of that in the EHA poster for sure. You're always limited in how much you can actually say in those quick presentations, but we will try and give color on that. I must say cartee, we haven't seen any patients that have gone through cartees. I think we've seen one or two by specifics, but no one with cartee. And then as illustrated in the ASH poster, we've seen a fair number with prior venetoclax. So it's a real mix right now, Hartaj. My experience in dealing with these type of trials, as clinical data comes, so it's easier to convince investigators to treat patients earlier in an earlier setting. So I think it's going to come quite nicely.

Hartaj Singh -- Oppenheimer -- Analyst

Great. Thank you all. Great update. Looking forward to EHA.

Paolo Pucci -- Chief Executive Officer

You're welcome.

Operator

Thank you. And at this time, I have no other callers in the queue for questions. I'd like to turn the call back over to Marc for closing remarks.

Marc Schegerin -- Chief Financial Officer, Head of Strategy and Treasurer

Thanks very much. That concludes today's call. Thanks everyone for joining.

Operator

Ladies and gentlemen, thank you for your participation in today's conference. You may disconnect. Everyone, have a wonderful day.

Duration: 56 minutes

Call participants:

Marc Schegerin -- Chief Financial Officer, Head of Strategy and Treasurer

Paolo Pucci -- Chief Executive Officer

Brian Schwartz -- Chief Medical Officer

David Ruch -- SVB Leerink -- Analyst

Gregory Renza -- RBC Capital Markets -- Analyst

Chad Messer -- Needham and Company -- Analyst

George Zavoico -- B. Riley FBR -- Analyst

Hartaj Singh -- Oppenheimer -- Analyst

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