Earnings Call Transcript - PGEN Q2 2023

Operator, Operator

Good morning and welcome to the Precigen Second Quarter and First Half 2023 Financial Results and Business Update Call. Please note this event is being recorded. I would like to turn the conference over to Steve Harasym, Vice President of Investor Relations.

Steve Harasym, Vice President of Investor Relations

Thank you, operator, and thank you for joining us today. With me are Dr. Helen Sabzevari, President and CEO of Precigen; and Harry Thomasian, our CFO. Helen will provide details on today's releases and an update on our portfolio. After which Harry will review our second quarter and first half 2023 financial results. Following our prepared remarks, we will open the call to Q&A. Before we begin, let me briefly review our forward-looking statement. During today's call, we will make various forward-looking statements. Investors are cautioned that our forward-looking statements are based on current expectations and are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those indicated by our forward-looking statements. Please read the safe harbor statement contained in this presentation as well as risk factors contained in Precigen's most recent SEC filings for a more complete discussion of these risks and uncertainties. I will now turn the call over to Dr. Sabzevari. Helen?

Helen Sabzevari, President and CEO

Thank you, Steve, and thank you all for being here today. Today marks an exciting milestone for Precigen, and I want to share the notable advancements we've made in the first half of this year. I will touch on two key topics today. First, we have positive regulatory news regarding our lead program PRGN-2012 for an orphan rare disease setting in RRP, which we announced this morning. Second, we are prioritizing our portfolio to speed up the development of PRGN-2012 towards commercialization while continuing to progress other significant programs and extend our cash runway to 2025. Moving on to slide number 4, we have been active in discussions with the FDA to ensure a quick regulatory pathway for PRGN-2012, particularly because there is a high unmet need among RRP patients who currently have no approved medications and rely on recurring surgeries, which can be burdensome both physically and financially. We're pleased to announce that the FDA has confirmed that the ongoing single-arm Phase 1/2 study will serve as the pivotal study to support the BLA submission for accelerated approval. Importantly, no additional randomized controlled study is required for this approval. We have also agreed with the FDA on the study endpoints that will support our BLA submission, including the complete response rate—the percentage of patients who do not require surgical intervention in the 12 months post-treatment—and an immunological surrogate marker for HPV-specific T cell responses, which we have already implemented in both Phase 1 and Phase 2. Moreover, we have reached an agreement with the FDA to begin a single confirmatory study, which need not be completed before submitting the BLA. We are very grateful to the FDA, who even encouraged us to explore adding an exploratory arm for repeat dosing for non-complete responders, which could allow us to potentially broaden the label. This pivotal Phase 1/2 study for accelerated approval can significantly shorten the development timeline to licensure, which is crucial for our patients since the absence of a randomized Phase 3 study allows us to move much more swiftly. We are also preparing our in-house gene therapy manufacturing facility to produce drug substance for commercial launch, enabling us to retain control over manufacturing and reduce costs and timelines via less dependency on contract manufacturers. Currently, the ongoing single-arm Phase 1/2 study is progressing well; we have completed the Phase 1, and the enrollment and dosing in the Phase 2 portion are also done. We expect to complete follow-up data collection for Phase 2 by the second quarter of 2024. Phase 1 data shared in January indicated that 50% of patients treated at dose level 2 experienced a complete response, meaning no further surgery was needed for 12 months. I am delighted to report that all complete responders from Phase 1 remain surgery-free with a minimum follow-up of 18 months, and these responses are ongoing. We are highly optimistic about the potential of PRGN-2012 for RRP patients, who often face numerous surgeries throughout their lives that can be financially and emotionally taxing. Our priority is to deliver this therapy as quickly as possible to those in need. I want to thank the entire Precigen team, along with our investigators and collaborators, for their extraordinary efforts in moving PRGN-2012 from discovery to being recognized as a pivotal trial on the path to accelerated approval within about three years, pandemic-impacted years included. If we look at slide number five, I want to emphasize what distinguishes PRGN-2012 and the adverse platform in the market. We have actively engaged with key opinion leaders and learned what makes this molecule and platform unique. One major highlight is the promising mechanism of action, which physicians find encouraging, particularly its ability to generate T cell responses targeting HPV 6 and HPV 11, the viral strains responsible for RRP. This approach addresses the infection directly, which leads to the recurrence of papillomas in critical areas such as the vocal cords, trachea, and lungs. The safety data are also favorable, demonstrating Grade 1 and Grade 2 reactions similar to flu-like vaccination, which is significant for both patients and healthcare providers, especially considering that some future patients may be children. Moreover, we've consistently heard from patients that even reducing the number of surgeries by one is crucial for them. With complete responders now at over 12 months without surgery, we have achieved important results, especially with patients who typically require more than three surgeries annually. This is genuinely encouraging, and we are thrilled for the patients impacted. Lastly, our platform features a convenient route of administration, allowing vaccines to be given subcutaneously, similar to a flu shot, which represents a significant convenience for patients who normally face continuous surgery. Now, let’s review slide number six, which illustrates the scenario for RRP patients compared to normal vocal cord growth. RRP patients are reliant on continuous surgery to remove benign tumors just to speak or breathe, a situation that would be particularly distressing for a parent with a child facing frequent surgeries. Recognizing that there are no approved therapeutics for RRP underscores the FDA's decision to support accelerated approval, and we sincerely appreciate their acknowledgment of the patients' needs and the innovative approaches to address them. Repeated surgeries, the current standard of care, fail to treat the underlying issue of this disease. The chronic nature of RRP means patients often undergo hundreds of surgeries in their lifetimes, which can deteriorate their condition, increasing both the spread of the HPV virus and associated comorbidities, such as loss of local functions. This disease carries significant economic and quality-of-life burdens over the lifespan of RRP patients. In the U.S., there are approximately 10,000 adult and 6,000 juvenile RRP cases. The number of cases outside the U.S. is even larger, but we need more research to ascertain these figures, which will contribute to our market projections for both the U.S. and internationally. Given the potential to accelerate our transition to a commercial-stage company and the challenging capital markets as of now, we should concentrate on expediting the path of PRGN-2012 to commercialization. This focus will best position Precigen for success in the short term amid the current environment. On slide number 7, we outline the steps we're taking to realign our resources and pipeline to achieve significant cost savings, particularly by reducing external CRO spending and SG&A costs compared to initial budget forecasts. Harry will provide more details on the cost-saving measures we've implemented in previous years and this year. To briefly highlight our focus areas, we are committed to accelerating the PRGN-2012 pathway without compromising our other important programs, while also extending our cash runway, facilitating our ability to achieve key milestones. We are reducing external clinical costs by limiting the number of sites involved in various programs. We continue to decrease our SG&A expenses, and Harry will elaborate on this. Simultaneously, we're redirecting our R&D team to emphasize CMC and translational clinical research activities. Our highly productive cross-trained teams are shifting their focus to support the CMC and translational work needed for PRGN-2012’s approval path. This approach ensures no reduction in our R&D workforce, allowing us to retain talent while saving time and money. This is crucial for meeting our agile submission timelines for the BLA. Regarding our PRGN-3006 UltraCAR-T program, this remains a top priority. We've reported promising results, including nearly a 30% objective response rate in AML patients with no other treatment options, and we've received fast track designation from the FDA. We plan to maintain two active and productive clinical sites, Moffitt and Mayo, for our ongoing Phase I study for now, with interim Phase 1b data expected to be presented in 2024. No new sites will be initiated in the remainder of 2023, and we will provide updates on site expansion in upcoming quarterly calls. Similarly, our PRGN-3005 Phase 1b study is ongoing at Fred Hutch, and as part of our cost-saving measures, we plan to activate a second site under our CRADA with NCI to advance this program without significant clinical or CRO costs. PRGN-3007 is also progressing as an investigator-initiated Phase 1 at Moffitt. Regarding PRGN-2009, specifically for cervical cancer, which operates on the same platform as PRGN-2012, we are excited to share plans to activate the NCI site initially, leveraging our CRADA to minimize clinical costs this year, with updates on additional sites to follow in early 2024. Importantly, we have engaged in discussions with several parties about non-dilutive funding opportunities that could further extend our runway to beyond 2025. We have already begun the process of divesting Exemplar, which will be detailed by Harry, and this transition has enabled us to fully settle our convertible notes. Exciting discussions are ongoing regarding our AG019 for the T1D program, and we plan to update our investors in future quarters. Additionally, discussions surrounding partnerships for our UltraCAR-T programs are underway, which we will also address. These are all avenues for non-dilutive funding that, along with our current cash runway extending to 2025, can significantly enhance our financial stability. With this invigorating update, I will now turn the call over to our CFO, Harry, for the financial updates and our strategic plans.

Harry Thomasian, CFO

Thank you, Helen. And also, thank you to those participating on the call today. I'm going to speak from the notes of the information on slide 8 just to focus those on the call. This is a momentous day for Precigen, as Helen has said earlier, combined with the announced regulatory path for PRGN-2012, we've positioned our balance sheet to provide us the cash runway to successfully transition toward a commercial stage company. As you will see in our financial statements included in our 10-Q, which was filed with the SEC earlier this morning, we now retired all of our convertible notes. The retirement of these notes will save us $7 million per year in cash interest costs going forward. In addition, through the efficient early retirement of a significant portion of our convertible notes, we were able to save approximately $8.4 million in cash over the past 10 months. Turning now to a discussion around SG&A. Since I started with Precigen in October of 2021, we've been laser-focused on rightsizing our SG&A costs for the company we are today. And I'm pleased to announce that on a year-to-date basis, compared to the first six months of 2022, our SG&A costs have decreased $5.4 million or 21%. Just looking at the second quarter of 2023, compared to the same period last year, SG&A costs have decreased $3.4 million or 27%, showing a positive trend over the first quarter. A portion of these savings were due to past headcount reductions, which are now being realized. We finished the quarter with $95.6 million in cash, cash equivalents and short and long-term investments, providing a basis for a strong forward-looking cash runway. Taking into account the reprioritization of our pipeline, as Helen has laid out, the elimination of our convertible notes and continued focus on reducing SG&A expenses, we are now providing guidance on our cash runway into 2025 as Helen has previously mentioned. This extended cash runway is important for our shareholders, as it gives us a runway well beyond the pivotal Phase 2 data readout of PRGN-2012 and 2024, and provides us with a substantial amount of time to obtain additional funding via non-dilutive methods. I will now turn the call over to the operator for Q&A.

Operator, Operator

At this time, we will begin the question-and-answer session. The first question comes from Jason Butler with JMP Securities.

Jason Butler, Analyst

Hi. Thanks for taking the question. Congrats on the progress. A couple on PRGN 2012. Just was there any discussion with FDA about the magnitude of benefit and a complete response rate you would need to show in the Phase 2 portion to support accelerated approval? And then can you just remind us what the patient population baseline characteristics in the Phase 2 portion look like versus Phase 1? And then I have a follow-up. Thank you.

Helen Sabzevari, President and CEO

Thank you, Jason. We have had discussions regarding complete responses, and we are pleased that the FDA has agreed with our endpoints for complete responders after 12 months of follow-up. The current design combines Phase 1 and Phase 2 data for consideration as pivotal for accelerated approval. We are very grateful to the FDA leadership for recognizing that our Phase 2 design aligns exactly with our Phase 1 in the same patient population, specifically those with a minimum of three surgeries. Both phases have enrolled patients with the same characteristics and endpoints. This is part of why the FDA has confirmed that we can combine results from the second dose level of Phase 1 with the second dose level of Phase 2. Additionally, we have exciting discussions with the FDA about possibly adding another arm to expand the label for patients who have had fewer than three surgeries, even as few as one surgery a year, as well as for repeat dosing. In our data presentation in January, we showed an overall response rate of 83% in this patient population, with 50% achieving complete responses and 33% experiencing a reduction in the number of surgeries. The FDA acknowledges the mechanism of action and the immunological enhancement of T-cells against HPV, and they encourage us to add another arm to address partial responders through repeat dosing, which we greatly appreciate. This is promising for the future expansion of this drug's label. We have confirmed with the FDA that the endpoints for Phase 1 and Phase 2 are the same.

Jason Butler, Analyst

Great. Thanks, Helen. And then how should we think about repeat dosing in terms of how the timing after the first dose? Would you wait as long as 12 months, or could you actually give a second dose earlier, given that in some of your complete responses at least you were seeing it within the six- to 12-week time frame?

Helen Sabzevari, President and CEO

Yes. That's a great question. We are currently in discussions with our investigators about this. The decision will depend on the number of surgeries a patient has undergone. If patients are not complete responders, they might desire a follow-up surgery a couple of months later, which we can consider. This applies if they are categorized as partial responders or non-responders. We can design various aspects around this and also examine different patient populations. All of this is being discussed with our investigators. As we proceed with our design, we will also engage with the FDA to seek further guidance through our breakthrough designation, which is crucial for us because it facilitates a rapid and continuous dialogue with the FDA. We are looking forward to this process. However, I want to emphasize that this is not part of the confirmatory process; it is optional for us. It's encouraging that the FDA recognizes the positive results and encourages us to consider extended repeat dosing.

Jason Butler, Analyst

Thank you and congrats again.

Helen Sabzevari, President and CEO

Thank you.

Operator, Operator

Thank you. And the next question comes from Jennifer Kim with Cantor Fitzgerald.

Jennifer Kim, Analyst

Hi, good morning. Thanks for taking my…

Helen Sabzevari, President and CEO

Hi, Jennifer.

Jennifer Kim, Analyst

Hi and congrats on a lot of good progress this quarter especially with PRGN-2012. Maybe to start off on PRGN-2012, is there a way we should think about the timeline between the positive phase or if there's positive Phase II data in the second quarter, starting the confirmatory study and then BLA submission? And I know you just said that the exploratory arms aren't required for BLA submission, but would you want to submit something on that point in conjunction with the submission, or what is your thinking currently? And I have a few more after. Thanks.

Helen Sabzevari, President and CEO

Yes. We are focused on ensuring everything is aligned for the BLA submission. The Phase 1/2 trial is open label and not randomized. As the data becomes available, we will prepare accordingly. We also plan to use our breakthrough designation to pursue a rolling BLA submission as part of our strategy for expedited processing. Additionally, our Phase II follow-up is expected to be completed by the second quarter of 2024. We are committed to being ready and moving quickly on our BLA submission related to the confirmatory trial, which will also be a single-arm trial similar to our previous work, and we are in the process of initiating that. There has been minimal discussion about the design at this point. We are currently discussing the inclusion of patients with a lower disease burden and repeat dosing in the design. However, our top priority is to start the confirmatory trial as we submit the BLA, given the urgency for these patients who have no other options, and we aim to advance this towards commercialization as swiftly as possible.

Jennifer Kim, Analyst

Okay. Wonderful. And as you look at the 18-month follow-up data and these complete responders and you're considering the ability for redosing, how does all of that play into your current thinking about pricing?

Helen Sabzevari, President and CEO

Yes. So yes, we are receiving the data, and we see the data as it goes. Number one, since there are still complete responders and they are in response, they have not required any redosing. So obviously, that's very exciting, and we are very, very happy for the patient. In regard to the patients that are partial responders, and we are designing the arm to address the repeat dosing. This is something that we will be addressing, and we will report on what the design would be in the upcoming months and we will be further discussed about the market and the pricing at that point, I think.

Jennifer Kim, Analyst

Okay. Great. My final question is about your discussions with parties regarding non-dilutive opportunities. You mentioned two focuses: AG019 and the UltraCAR-T platform. When discussing this, what kind of framework are you working within? Is it more of a research and development collaboration, or are you trying to understand the upfront terms involved?

Helen Sabzevari, President and CEO

Absolutely. Regarding AG019, we have completed Phase II data and have prepared for Phase III and commercial manufacturing. However, we decided not to enter Phase III due to the prioritization of the program and its cash requirements. Over the past year and a half, it has become clear in the field, particularly with the approval of some antibodies like Teplizumab for Type 1D, that our data—both as a standalone treatment and in combination—demonstrates superiority. AG019 has garnered significant attention, and we are in discussions with several parties, focusing on partnerships rather than just research development for AG019. Additionally, for UltraCAR-T, particularly regarding our data related to AML and the potential in solid tumors, we are also engaging with various parties about potential collaborations or partnerships related to research and clinical needs, and we aim to provide updates on these soon. Lastly, even though it wasn't specifically asked, I want to mention that we are excited about progressing the divestiture of our subsidiary Exemplar, which will provide non-dilutive cash and help extend our financial runway beyond 2025. By extending our cash run rate to 2025, we can achieve our data readouts and hopefully turn our discussions with partners into reality, further extending our financial runway.

Jennifer Kim, Analyst

Okay. Very helpful. Thanks very much, guys. I'll pass it.

Operator, Operator

Thank you. And the next question comes from Arthur He with H.C. Wainwright.

Arthur He, Analyst

Hi. Good morning.

Helen Sabzevari, President and CEO

Hi, Arthur.

Arthur He, Analyst

Hi. Thank you for taking my questions. I apologize if this question has been asked before. Regarding the 2012 program, I'm curious about your perspective on the efficacy data endpoint. What do you consider to be the approval threshold for efficacy, and what type of data do you think would be more commercially favorable?

Helen Sabzevari, President and CEO

I think, from a perspective of commercially favorable, as you can see there is nothing there. There are no other therapeutics currently exist for this patient except for a number of surgeries over and over and over again throughout their lifetime. And if you can imagine, that if you have this disease from childhood, it means a lifetime of surgeries and challenges with this. So in that regard, we hope to be the first therapeutic on the market for this disease on patient population. In regard to the efficacy, as we have said, we have currently shown what as far as 50% of our patients from Phase 1 who are complete responders. And one thing that we have discussed with the FDA is very clear that surgeries alone don't lead to the regression of these patients. And because if it was then all the years that these patients had the surgeries they should have been cured by now, which unfortunately is not the case. And therefore, the automatic regression is not there. But even if you consider that the approval threshold would be above 10%, you will be benefiting these patients, but we are currently standing at 50% response rates. So we are very excited. And by the way, this is a very deep response. Not only have we completed our 12 months of a response, but as I mentioned, from Phase 1, our patients' responses the complete responses are ongoing and none of them have required any surgeries.

Arthur He, Analyst

Yes. Thank you for the answer. And just to go a little bit deeper regarding the study. During the transition with FDA, did they put any color on the pre-existing level of the antibody to the vector as a screening requirement for the patient? And also did they make a requirement for monitoring the antibodies raised in the body upon their treatment?

Helen Sabzevari, President and CEO

We already had actually in our design, we already had immunological readouts, which included both neutralizing antibodies as well as HPV-specific T cells. And actually, the FDA very much appreciated that and recognized the importance of these readouts in conjunction with the mechanism of action that we are showing. And one thing I should remind everyone in regards to the AdenoVerse platform again, that as we have shown in previous data, both in regard to PRGN-2012 but PRGN-2009. And even in healthy volunteers, there is no prior or very little pre immunity to the Gorilla Adenoviruses. And this is the uniqueness of this platform. One other thing that in the data with PRGN-2012, we showed in January is that upon repeat dosing you would not see increases in a neutralizing antibody or if there is a slight increase then it comes down. And therefore, you will not have the issues that you're having with AD5 and other viruses, which basically limits you to giving this only once or at best that you can give twice. And we have shown now that data extensively for various drug products that have used the AdenoVerse platform both PRGN-2012 and 2009. And similarly, I will remind everyone that we have shown HPV-specific T cells from our Phase 1 PRGN-2012 as well as Phase 1 in PRGN-2009, which in those settings their patients that had HPV cancers for instance, upon repeat dosing on a monthly basis. We have shown that you can keep enhancing the T-cell responses over the year for instance that the patients have been on treatment. And again, this is part of the differentiation of the mechanism of action of this platform versus all the other ads retroviruses and other platforms that exist there.

Arthur He, Analyst

That's great, Helen. And if I may, if I may ask a last question. So regarding the market outside the US, what's your current strategy for that? Thanks.

Helen Sabzevari, President and CEO

As we just have confirmed with the FDA, we are moving rapidly with the discussions with the EMA at the same token with the UK and also with Japan currently, to basically position PRGN-2012 as a drug product and also on a path for licensure there.

Arthur He, Analyst

Thank you. Thanks for taking my questions and congrats on the progress.

Helen Sabzevari, President and CEO

Thank you.

Operator, Operator

And the next question comes from Ben Burnett with Stifel.

Ben Burnett, Analyst

Hey. Thank you very much. And I will throw in my congrats on the progress this quarter.

Helen Sabzevari, President and CEO

Thank you, Ben.

Ben Burnett, Analyst

I would like to ask about PRGN 2012. In the past, you provided efficacy data on several different endpoints in addition to the 12-month complete response rate. What is the overall data that the FDA will consider? Are they focusing on those other endpoints you have presented? Also, how much emphasis do they place on durability compared to response rate?

Helen Sabzevari, President and CEO

I think very good question. First of all the part of the endpoints that we put forward, which was very meaningful, was that we didn't go for a reduction in the number of surgeries. What we went for upfront and we provided was that no surgeries are required for 12 months, which is quite a long period of time. It was not for three months or six months. And one other thing that we did, which I believe was seen as a very positive point was we went to a very severe patient population, which they require three surgeries and higher. So all those elements together, it not only shows the durability of the immune response, especially now that we continue obviously to follow all of our patients. And especially with our responders, we are showing they are well past 12 months and they continue to be in full response. So that speaks to the durability of that response that 12-month follow-up and beyond. On the other hand the fact that we showed a mechanism of action associated with this. And I think this is again was appreciated by the FDA leadership. Because clearly, we have clinical data from the patients that are in full response that they have generated a specific HPV 6 and 11 responses and that obviously, this is due to the treatment as this patient did not have these responses prior to entering the trial. So I think that has become very, very important. And the fact that the mechanism of action, it relates to the ability to redose with the AdenoVerse platform. Again, that's a huge differentiation and difference between us and others, because with this you allow now to give a number of in this case is the course of over 85 days. And by the way it's subcutaneously event. And it allows, obviously, without having increased neutralizing antibodies or tremendously increased neutralizing antibodies, which will hinder the usually the T-cells and we don't see that at all. Opposite, it allows all of that to be considered as the uniqueness of this product and also the FDA confirmation for accepting the endpoints that we had plus the immunological markers that we have currently have put in the trials and therefore.

Ben Burnett, Analyst

Okay. Excellent. That's very helpful. And I would also like to ask a question around this repeat dosing, which I think is really interesting. I guess, do you have a sense at this point like how many patients would constitute a relevant database to adjudicate the efficacy of repeat dosing? And I'm assuming would a repeat dosing just be the four-dose course as, or would you maybe modify that course in patients that you're redosing?

Harry Thomasian, CFO

I think that we have ongoing discussions with our investigators about various scenarios for repeat dosing. For instance, patients who may require surgery after some time and are not full responders could receive another treatment course. Alternatively, some patients may have received single doses throughout their treatment. Given the uniqueness of our platform, we’ve successfully administered treatments on a monthly basis, as demonstrated with PRGN-2009, where some patients participated for over two years and achieved complete responses, showing very deep responses for more than a year after vaccination. This suggests that we can consider monthly or quarterly dosing options. These discussions are based on immunological outcomes, and we will be designing appropriate study arms to effectively explore repeat dosing for the entire patient population. PRGN-2012 is also crucial in our approach to treating RRP, and addressing the needs of the entire patient population is very important for us as we look to extend our research into pediatric patients as well.

Ben Burnett, Analyst

Okay. Fantastic. And if I could just maybe squeeze one more just a clarification question on the updated cash runway, which by the way great to hear about the cash runway and obviously congrats on now fully retiring the remaining debt. Is the updated cash runway include costs associated with this expansion repeat dosing cohort and the confirmatory study, or is that separate?

Harry Thomasian, CFO

It does include, Ben. It does include some of that. Not to the specificities as Helen had said, we're still needing to design that. But there is contemplation of those costs.

Helen Sabzevari, President and CEO

Yes. Then I can also say that, it does include the confirmatory, because again, our confirmatory is a single arm. I want to remind everyone, it's not a randomized control Phase III. It will be a single arm with a similar exact design as we have done with the Phase I or Phase II. The expanded arms is something that we will discuss but that does not have to be initiated prior to BLA and we can initiate those arms at a later point after the design. So, for the purposes of the costs and our runway, we have considered part of our manufacturing. As you can see that, we are switching our own manufacturing by reprioritizing our own manufacturing facility to address some of the costs and it does take into account the initiation of the confirmatory trial.

Ben Burnett, Analyst

Wonderful. Thank you, so much.

Helen Sabzevari, President and CEO

Sure. Thanks.

Operator, Operator

Thank you. And the next question comes from Brian Cheng with JPMorgan.

Brian Cheng, Analyst

Hi team. Thanks for taking my question this morning. From your discussion of the FDA, have they talked about how long of a safety follow-up do you need in the ongoing study before filing? And then on the preparation work for filing, can you talk about whether there are any additional preclinical work that you need to tee up between now and filing that you have to work on? And then I have a couple of follow-ups. Thank you.

Helen Sabzevari, President and CEO

In terms of the safety profile, it's comparable to the efficacy endpoints we have for the one-year safety follow-up. We will continue to monitor these patients as they progress. These are part of the endpoints. I want to emphasize that the drug product has a very favorable safety profile among all the patients we have treated. Regarding the preclinical discussions, the necessary preclinical work was completed before we moved to Phase I and Phase II. However, we must meet all the criteria required by the FDA for any Biologics License Application submission. This typical submission for the BLA will include Phase II data that aligns with our previous findings and meets the clinical endpoint. We are also in discussions with the FDA about manufacturing comparability and the use of our commercial material in the confirmatory trial. These discussions are ongoing, and our BLA submission will require all these components for a swift review and approval, which we are aiming for.

Brian Cheng, Analyst

Okay. And then on the manufacturing front, can you elaborate on your commercial readiness? What's needed specifically to prepare on the CMC side and at the time of your anticipated launch, what is the capacity that we should anticipate?

Helen Sabzevari, President and CEO

Well, we have evaluated our own manufacturing facility, which, by the way, provided all of the GMP material that was used in this trial even during the pandemic time, as you can imagine, because we started the trial of PRGN-2012 in April of 2021. So you can imagine our manufacturing has prepared that during the ongoing pandemic, which was very important because at that point, all of the external manufacturing shut down, and no one could prepare anything. So that's one of the importance, as I mentioned, why we have decided to move the commercial manufacturing to our own facility and make our facility commercially ready for this path and for the licensure path. We will be moving our material for the commercial material as we speak. Our teams are working on various aspects of comparability and also production. Since we have produced our GMP material ourselves and the processes are minimally switched. We hope that we have a very good comparability profile for manufacturing, which will be obviously presented to the FDA, and we anticipate that we will be ready to launch from our commercial facility here after the approval of our BLA. I should mention that especially within the patient population that is in the U.S., we believe our commercial facility has the capability to produce enough doses for that. And also, obviously, after the approval and during this process, we are also looking at further expansion. So with that, we believe that our facility will be sufficient for production of the doses that are needed in it.

Brian Cheng, Analyst

Great. If I could squeeze in the last one, that would be great. Just one on your overall thinking around the entire R&D portfolio. As you mentioned, there are multiple potential partnerships and divesting opportunities that you currently have on the table. And given that you have a cash runway out to 2025, can you talk about how should we think of how the R&D portfolio will evolve over the next 12 months? And what are the factors that you will take when you think about what to prioritize and what to partner off? And thank you.

Helen Sabzevari, President and CEO

Thanks for your question. It's clear that we have immediate partnerships in mind, especially regarding AG019, which we're quite excited about. However, Precigen currently lacks the necessary funds to proceed with an extended Phase 3 for this asset, which is why we're engaged in active discussions with several parties about AG019. Regarding our UltraCAR-T, particularly PRGN-3005, it's at a more advanced stage, showing favorable objective responses. It has fast track designation, potentially leading to a rapid regulatory pathway for AML patients. We expect Moffitt and Mayo Clinic to continue their strong recruiting efforts in the upcoming months, and we anticipate having interim data from a Phase 1b study by 2024. This positions us well not only for regulatory decisions but also in our discussions with interested parties regarding the program's advancement towards commercialization. I want to emphasize our commitment to prioritizing our portfolio, as Harry has pointed out. We've significantly reduced SG&A costs and limited extraneous clinical research organization (CRO) expenses by not opening additional sites, which can be costly. This strategy allows us to save resources while working toward the readout of our PRGN-2012. The FDA's decision is crucial for us because it eliminates the need for a Phase 3 study, which would have delayed data collection by another three or four years. Currently, we're observing data from Phase 2, and we will complete the required 12-month follow-up by the second quarter of 2024. Our cash runway extends well into the future, enabling us to provide our readout and submit our Biologics License Application (BLA) without needing to dilute our stakes. Our discussions about non-dilutive options have been productive, and we hope to extend our cash runway beyond 2025. I also want to express my gratitude to the Precigen team for their dedication. Uniquely, our R&D efforts have benefitted from our team's expertise in asset development, immunology, and clinical strategy, allowing us to take on many responsibilities internally. This reduces the need for significant hiring or retraining, enabling us to move quickly towards commercialization, which is a key strength for Precigen.

Brian Cheng, Analyst

Thanks, Helen. Thank you.

Helen Sabzevari, President and CEO

Sure. Thank you.

Operator, Operator

Thank you. And this concludes the question-and-answer session. I would like to turn the floor to Dr. Sabzevari for any closing comments.

Helen Sabzevari, President and CEO

Thank you. First of all, I would like to thank you for joining us today. I want to extend our thanks to the patients for participating in clinical trials, our investigators for their dedication and commitment working on studying new therapies for our unmet needs and to the team at Precigen, who have worked so hard over the last several years. As we have discussed today, we believe the PRGN-2012 has paradigm-changing potential and with today's announcement of the FDA alignment on a path to an accelerated approval request for our ongoing Phase 1/2 study. This is an important milestone that brings us a step closer in our transition to a commercial stage company, and in realizing our vision of bringing life-changing therapies to patients with unmet medical needs. Given that the Phase 1/2 is fully enrolled and serves as pivotal this sets us up potentially to bring a life-changing first therapeutic option for RRP patients who have been waiting for decades for such an option. Thank you again. And now I return it to the operator.

Operator, Operator

Yes. Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.