Financial Data and Key Metrics Changes - The company ended Q3 2021 with $861.7 million in cash, cash equivalents, and investments [23] - Research and development expenses for Q3 2021 were $58.7 million, including $10.1 million of non-cash stock-based compensation [23] - General and administrative expenses were $19 million for Q3 2021, which included $10.8 million in non-cash stock-based compensation [23] - The net loss for Q3 2021 was $78.2 million or $0.57 per share, including non-cash stock-based compensation expense of $20.9 million [23] Business Line Data and Key Metrics Changes - The company has treated over 130 patients with lymphoma, multiple myeloma, and renal cell carcinoma across five Phase 1 studies [11] - In the ALPHA1 trial, over 60 lymphoma patients were treated, with updated data expected to be shared at the ASH conference in December [11] Market Data and Key Metrics Changes - The FDA placed a clinical hold on the AlloCAR-T clinical programs due to a chromosomal abnormality observed in one patient in the ALPHA2 trial [7][9] - The company is actively engaged with the FDA to resolve the clinical hold and has submitted end of Phase 1 materials in anticipation of a potential ALLO-501A pivotal Phase 2 trial [10][33] Company Strategy and Development Direction - The company remains committed to advancing its platform and data despite the clinical hold, focusing on multiple workstreams including preparation for the Phase 2 pivotal trial on ALLO-501A [7][10] - The company believes in the potential of its AlloCAR T products and aims to increase access to therapy while decreasing manufacturing time and cost [9][10] - The company is preparing for the advancement of the ALLO-501A program into a pivotal Phase 2 study, although certain workstreams are delayed due to the clinical hold [15][23] Management's Comments on Operating Environment and Future Outlook - Management expressed appreciation for the FDA's engagement and is optimistic about resolving the clinical hold in a timely manner [9][10] - The company is focused on generating information to understand and address the chromosomal abnormalities observed in patients [9] - Management emphasized the importance of the AlloCAR T product as a therapeutic option for patients who cannot wait for autologous CAR T cells [11] Other Important Information - The company expects full-year 2021 operational expenses to be between $300 million and $330 million, excluding any impact from development activities [23] - The company continues to support multiple research and operational initiatives despite the clinical hold [23] Q&A Session Summary Question: Can you provide more details on the ongoing discussions with the FDA regarding the clinical hold? - Management confirmed receipt of a clinical hold letter detailing FDA's concerns and data requirements, and they are actively engaged in discussions with the FDA [27][29] Question: What are the timelines for interactions with the FDA? - Management indicated that discussions with the FDA are collaborative and ongoing, with a focus on addressing the concerns raised [31] Question: What needs to be checked off to get the go-ahead for the Phase 2 study? - Management stated that discussions with the FDA regarding the end of Phase 1 materials have been productive, but specific details cannot be disclosed [35] Question: Will the upcoming ASH presentation include additional data on the multiple myeloma study? - Management confirmed that additional data will be shared at ASH, focusing on patients treated since the last cutoff [38] Question: What triggers the second dose in the consolidation dosing protocol? - Management clarified that patients must have stable disease or better to receive the second dose, along with ALLO-647 prior to the second dose [72]

PART I: FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The unaudited condensed consolidated financial statements for the period ended September 30, 2021, reflect decreased total assets and significant net losses [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $1.08 billion from $1.23 billion as of September 30, 2021, due to reduced short-term investments | Financial Item | Sep 30, 2021 (in thousands) | Dec 31, 2020 (in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | $502,858 | $845,130 | | **Total Assets** | **$1,079,246** | **$1,227,829** | | **Total Current Liabilities** | $53,490 | $94,320 | | **Total Liabilities** | **$109,304** | **$148,212** | | **Total Stockholders' Equity** | **$969,942** | **$1,079,617** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) The company reported a net loss of $78.2 million for Q3 2021 and $182.1 million for the nine-month period | Metric (in thousands, except per share) | Three Months Ended Sep 30, 2021 | Three Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :--- | :--- | :--- | :--- | :--- | | Collaboration Revenue | $49 | $— | $38,438 | $— | | Total Operating Expenses | $77,719 | $68,040 | $220,337 | $188,881 | | Loss from Operations | ($77,670) | ($68,040) | ($181,899) | ($188,881) | | **Net Loss** | **($78,186)** | **($66,197)** | **($182,137)** | **($181,651)** | | Net Loss Per Share | ($0.57) | ($0.52) | ($1.35) | ($1.55) | [Condensed Consolidated Statements of Stockholders' Equity](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Total stockholders' equity decreased to $969.9 million, primarily due to a $182.1 million net loss - The accumulated deficit grew from **$646.3 million** at the end of 2020 to **$828.5 million** by September 30, 2021, reflecting ongoing net losses from operations[12](index=12&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities increased to $139.4 million, with investing activities providing $134.4 million | Cash Flow Activity (in thousands) | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | ($139,376) | ($105,118) | | Net cash (used in) provided by investing activities | $134,405 | ($527,333) | | Net cash provided by financing activities | $11,641 | $620,613 | | **Net change in cash, cash equivalents and restricted cash** | **$6,670** | **($11,838)** | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail business operations, accounting policies, and financial arrangements, including the FDA's clinical hold - The company had cash, cash equivalents, and investments of **$861.7 million** as of September 30, 2021, and expects these funds to be sufficient for at least one year of operations[21](index=21&type=chunk)[22](index=22&type=chunk) - In October 2021, the FDA placed a hold on all of the company's clinical trials, and the timing for the hold's removal cannot be assessed, potentially adversely affecting financial position and prospects[110](index=110&type=chunk) - For the nine months ended September 30, 2021, the company recognized **$38.4 million** of collaboration revenue related to the license and know-how delivery to the Allogene Overland joint venture[74](index=74&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial results, emphasizing the FDA clinical hold, increased expenses, and the company's cash position - In October 2021, the FDA placed a clinical hold on all of the company's trials following a report of a chromosomal abnormality in a patient, with no timeline for resolution[115](index=115&type=chunk)[116](index=116&type=chunk) - As of September 30, 2021, the company had an accumulated deficit of **$828.5 million** and cash, cash equivalents, and investments of **$861.7 million**[117](index=117&type=chunk) | Expense Category (in millions) | Q3 2021 | Q3 2020 | Change | | :--- | :--- | :--- | :--- | | Research and development | $58.7 | $51.4 | +$7.3 | | General and administrative | $19.0 | $16.6 | +$2.4 | [Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are interest rate fluctuations on its $861.7 million investment portfolio and foreign exchange risk - The company's cash, cash equivalents, and investments of **$861.7 million** are subject to interest rate risk[168](index=168&type=chunk) - Foreign exchange risk exists due to collaboration payments denominated in Euros, with **$9.3 million** of foreign currency receivables as of September 30, 2021[169](index=169&type=chunk) [Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective, noting changes from the ongoing SAP ERP system implementation - Management concluded that disclosure controls and procedures were effective as of the end of the period[170](index=170&type=chunk) - The company is implementing a new SAP ERP system, causing changes to its internal control over financial reporting as processes are integrated and upgraded[171](index=171&type=chunk)[172](index=172&type=chunk) PART II: OTHER INFORMATION [Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any legal proceedings expected to materially affect its financial condition - Management believes there are currently no pending claims or actions against the company that would have a material adverse effect on its financial condition[174](index=174&type=chunk) [Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) Significant risks include the FDA clinical hold, a history of net losses, and reliance on partners for gene-editing technology - The company's clinical trials are currently on hold by the FDA due to a chromosomal abnormality observed in a patient, with unknown timing and outcome of the review process[178](index=178&type=chunk) - The company has a history of net losses, with an accumulated deficit of **$828.5 million** as of September 30, 2021, and expects to incur substantial future losses[180](index=180&type=chunk) - The company is heavily reliant on partners, particularly Cellectis, for access to the TALEN gene-editing technology, which is critical for manufacturing its product candidates[193](index=193&type=chunk)[196](index=196&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=71&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) All $343.3 million in net proceeds from the October 2018 IPO have been fully utilized for product pipeline and corporate purposes - The company raised approximately **$343.3 million** in net proceeds from its October 2018 IPO[397](index=397&type=chunk) - As of September 30, 2021, all net proceeds from the IPO have been fully utilized to fund the product pipeline and for general corporate purposes[398](index=398&type=chunk) [Defaults Upon Senior Securities](index=71&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities during the period [Mine Safety Disclosures](index=71&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company [Other Information](index=71&type=section&id=Item%205.%20Other%20Information) The company reports no other information for this item [Exhibits](index=72&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Quarterly Report on Form 10-Q, including certifications by the CEO and CFO - The report includes certifications from the CEO and CFO pursuant to SEC rules and the Sarbanes-Oxley Act of 2002[403](index=403&type=chunk)

Financial Data and Key Metrics Changes - In Q2 2021, Allogene Therapeutics reported a net loss of $70.9 million, or $0.53 per share, which included $21.1 million in non-cash stock-based compensation [27] - Research and development expenses were $52.3 million, including $10.5 million of non-cash stock-based compensation, while general and administrative expenses were $18.8 million, which included $10.6 million of non-cash stock-based compensation [27] - The company expects full-year 2021 operating expenses to be between $300 million and $330 million, indicating a significant ramp-up in expenses during the second half of the year [28] Business Line Data and Key Metrics Changes - The ALPHA trial demonstrated an overall response rate of 75% and a complete response (CR) rate of 50% in CAR-T naive patients with relapsed-refractory non-Hodgkin's lymphoma [9] - The six-month CR rate was reported at 36% in patients with large B-cell lymphoma histology [9] - ALLO-501A is on track to enter a pivotal phase 2 trial by the end of 2021, focusing on relapsed refractory non-Hodgkin's lymphoma [8][19] Market Data and Key Metrics Changes - The company is advancing its AlloCAR-T therapies in Greater China, Taiwan, South Korea, and Singapore through a joint venture with Overland Pharmaceuticals [26] - The ALLO-605 candidate received US FDA Fast Track designation for the treatment of patients with relapsed and refractory multiple myeloma [16] Company Strategy and Development Direction - Allogene aims to transition from a clinical-stage company to a commercial enterprise, focusing on product positioning and maximizing adoption [12] - The company is preparing for the industry's first allogeneic pivotal trial and has begun building its commercial team [12][14] - The Cell Forge 1 manufacturing facility is set to enhance the company's ability to deliver off-the-shelf CAR-T therapies faster and more reliably [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the safety and efficacy profile of ALLO-501A, highlighting its potential to provide timely treatment to patients [10][11] - The company is optimistic about the potential of its AlloCAR-T platform to address unmet medical needs in both liquid and solid tumors [16][24] - Management emphasized the importance of ongoing clinical trials and the generation of data to inform future strategies [17][19] Other Important Information - The company has five clinical trials underway, including two in the CD19 program and two targeting BCMA [15] - The ALLO-316 program is focused on clear cell renal cell carcinoma, with initial data expected next year [16][24] Q&A Session Summary Question: What type of data will be presented at year-end regarding consolidation? - Management indicated that they expect to present longer follow-up data on patients from ASCO, including more patients accrued in ALPHA and ALPHA2 trials [32] Question: Will the pivotal trial be a single dose or randomized for consolidation? - Management noted that the decision on trial design will depend on accumulating evidence and discussions with the FDA [36][38] Question: What are the expectations for infection rates with the consolidation regimen? - Management stated that the infection rates observed are similar to those in the autologous setting, and the split dosing may lead to lower rates [74][75] Question: What are the plans for ALLO-501A in follicular lymphoma? - Management confirmed that there are ongoing discussions about continuing development in follicular lymphoma alongside large B-cell lymphoma [60] Question: What is the rationale for targeting renal cell carcinoma with ALLO-316? - Management highlighted the attractiveness of CD70 as a target in both hematological and solid tumors, with renal cell carcinoma chosen as the first indication [64]

Allogene Therapeutics, Inc. (NASDAQ:ALLO) Q1 2021 Earnings Conference Call May 5, 2021 5:00 PM ET Company Participants Christine Cassiano - CCO David Chang - President and CEO Rafael Amado - EVP-Research and Development and CMO Eric Schmidt - CFO Conference Call Participants Salveen Richter - Goldman Sachs Marc Frahm - Cowen & Company Kelly Shi - Jefferies Michael Schmidt - Guggenheim John Newman - Canaccord Cory Kasimov - J.P. Morgan Luca Issi - RBC Capital Mark Breidenbach - Oppenheimer Ben Burnett - Stif ...