All right, we'll get started. Good morning still, everyone. I'm Tara Bancroft. I'm one of the Senior Biotech Analysts at TD Cowen. Thank you for joining us at TD Cowen's 45th Annual Healthcare Conference. For this session, we have a presentation from Fate Therapeutics. From Fate, we have the CEO, Bob Valamehr. Bob, we're so happy to have you here. Thank you so much for joining us. You can go ahead and get started on the presentation. Great. Thank you. Thank you for the invitation. Can you guys hear me? Am I good back there? Perfect. All right. Today I thought I'd take the next 25 minutes to talk about a couple of concepts. One is, what is a living drug? Why is it so different than your traditional drugs? Why Fate is unique in that realm? I will also talk about a couple of our most advanced programs. Forward-looking statement for your review. What is Fate's vision? It's a combination of taking living drugs and bringing it in an off-the-shelf manner, in an on-demand perspective, which is held with almost every medication that you can think of. It's at the pharmacy, ready to go. The living drug is very unique. It is a product that actually responds to the disease burden. This is not your traditional small molecule. I'll talk more about it, or biologic, where it decays. Regardless of the disease burden, you're going to get a certain threshold. It's just like a headache. You take aspirin, but that headache may not go away. You have to take more aspirin, or that aspirin is not good enough. A living drug makes it very unique. It is a product that is a medicine that's responsive to the disease burden. It actually tilts the balance for efficacy when it comes to the effector, the living drug to target ratio, which is the disease. What Fate does uniquely, because other people have been talking about living drug, this concept obviously became really into got its fame and glory through the activities of folks like Michel Sadelain and Carl June with the discovery of CAR-T cells. Living drugs created by others, autologous matter and allogeneic matter. What makes Fate very unique is we can take this living drug and provide it in a very unique setting where patients can come in and, after prescription, get that medicine right off, just like it's being held at a pharmacy, like any other drug. That has to do with the platform that I'll talk more about, which allows for a master cell bank for cell therapy to be expanded and stored for patient use. Pardon my cartoon here, because I'm sure eventually it'll get more creative. In the beginning, on the top, let me see if I get the laser pointer here. This is an untreated disease. The disease expands and takes over the patient. Conventional drugs, the drug is given, the disease comes down. As the drug goes away, then the disease recovers and expands again. A living drug actually responds to the disease and outcome peaks the disease. You end up completely eliminating the disease. You can see that here. We took CAR Ts, derived from iPSCs, and combined it to the spheroid assay. This is a spheroid, a scaffold created that would be similar to what a tumor looks like. Heterogeneous is a scaffold. It is three-dimensional, just like what a tumor, solid tumor, would look like, but in a Petri dish. Over the course of three days, you can see that it stays constant. Changes form a little bit, but overall, it is very similar. Here, when you add the CAR-T cells, you can see that when you added the cells, they are few, but then they start expanding. Those few cells are now responding to the target. They continue to expand, and they eliminate. Essentially, tilting the effector to target ratio in the favor of eliminating disease. No other medicine does this. No other medicine can respond to the disease and expand and overcome the burden. Doing this is very challenging. Cells, even though the discovery of CRISPR and previous to that, TALENs, and previous to that, zinc fingers have over time improved efficiencies, you still have a heterogeneous product. No drug developer wants to have medicine that is unpredictable. At Fate, this is where the uniqueness comes in. We start with a population of iPSCs. These are induced pluripotent stem cells. They are magical. In a Petri dish, you keep them. You keep them happy. At any time, you could tell them, go and become any of the 200 cell types found in the body. In fact, they do. If you have the right protocol, you can make those cells become cardiomyocytes. They start beating right under the microscope. You could convert them into T cells, and they'll get rid of the targets. They become very unique and very powerful. What we started back in 2009 doing was to control the culture of these cells. These cells are very finicky. As you could imagine, the cells in a Petri dish, that if they tilt right, they become hepatocytes. If they tilt left, they become neurons. They're always like these kids that you can't control in a classroom. They all want to run around. How do you keep them all aligned? How do you grow them? How do you engineer them? That's what we worked on for many, many years. Got to a point where, after an engineering process, it's called round one of engineering and cloning, you can see what a heterogeneous population looks like. I guess I don't need to worry about this mic. What a heterogeneous population looks like, only 13% of all the iPSCs got the knock-in without random integration that you want. You put a transgene in. You want the transgene to be in a very specific spot. You don't want it to be peppered all over the genome, because it will disrupt biological activities. You could have the cell start doing undesired things. This is what everybody deals with. When you engineer a population, 13% is amazing. If you go back 20 years ago, 13%, no one would believe. It would be 0.001%. Now it's 13%. It's great, but not for a drug developer. What we do is we take a clone out of this 13% pie and carry it forward. Here, we wanted to add more things. We wanted to knock more things out. We wanted to add more things in. We engineered a second round. We took one clone from this and re-engineered. This one was actually less efficient when it came to engineering. Only 2% was a population that we desired. We took a clone from here. We ended up with a master cell bank that went through two rounds of cloning and is now pristine for what you want. Very different than other conventional strategies. The other part is the scale. Using that master cell bank, now we've made a couple of hundred vials in a master cell bank. That master cell bank, each vial of the master cell bank can now be made into a working cell bank. I just went from a master cell bank of 200 vials to a working cell bank of 10,000 vials, because each bank gives me 500. Each vial of the bank gives me 500. Now I have 10,000 vials as starting material. Each of those vials can give me a campaign of expanding iPSCs to progenitor hematopoietic cells, CD34s, and continue that to make NK or T cells. This expansion gives me a trillion cells. Now I have 10,000 vials, and each campaign is a trillion cells. Really, this now becomes a process where I could massively make the product and not worry about issues with consistency, not worry about issues with heterogeneity or inconsistencies that people may face with autologous and even allogeneic cell therapy. That's great. Because we make in large scale, because we make in large scale, the cost goes down. Now each dose is only $3,000 and not $300,000. I could make a lot of it. It's uniform. I could make it over time, and the cost is down. Really becomes just like drug development, like a monoclonal antibody, like any other biologic that we're accustomed to. This is just an example to show that we can make thousands of doses for different programs. The one that I'll be talking about, FT819, we've already made over 1,500 doses. That's something that we don't think about now. We have our own manufacturing suite that I'll talk about. We are in complete control of our manufacturing process. It really takes out all the operational concerns about making a living drug. You can now have a consistent, pure product. This is just a picture that I'm not lying. We do have a GMP facility. It's 40,000 sq ft. It has the capacity, if I was to focus just on 819, and you'll see what I mean by 819, if I just focus on that, I would make 50,000 doses per year. We can make 50,000 doses at a cost of $3,000 a dose in a facility that's about 40,000 sq ft. Again, very different than what others are dealing with when it comes to cell therapy. This is because of the iPSC platform. We start looking very different. If you look at this kind of cascade of events for autologous, you start here. You've got to go through a lot of different steps. You've got to go through procurement of the T cells from the patient. Those T cells aren't the best T cells in the world, because whether you have autoimmune disease or whether you have cancer, your T cells are not in a good place. You've got to engineer. You've got to have a heterogeneous product. Some of the release criteria I've seen, CAR- positive population, the release specs between 20%-80%. That is quite a variability in range. The patient has to recover from the apheresis. Now you've got to, fingers crossed, you've got to manufacture. You've got to make sure you can make it. You've got to send it back. You only made one dose. It is really a very daunting task. The outcomes are great. We continue to do it. Allogeneic takes a couple of those steps out of the equation. The donor has been already selected. They've given the T cells. You begin the process. You make more cells. You make more cells to be able to treat more patients. You could only make a limited expansion, because as we keep T cells in culture, they get exhausted. Three, four weeks, a T cell in culture is very different than the performance of a T cell that's been in culture for only one week. They get addicted to the media, to the cytokines, to the activation cues. When they go into the body, they don't have that. It's like coming off some sort of drug, where now you're going through recovery. You're not really working. Probably not a good analogy. Regardless, you're limited in how much you could expand. That's the point. You still have the heterogeneity that you deal with in population engineering setting. There are a lot of different issues here. One of the most prominent issues is making sure you get rid of TCR expression, because that elicits GVHD in an allogeneic setting. Studies have shown historically that even 0.5% of your population being TCR positive elicits GVHD. You have to be pristine. All that takes time. The cells do not want to be in culture for that long. They get exhausted. Ours is quite different. We have already made a master cell bank. It has been engineered once. We do not have to go back to the donor. Once we run out, we do not have to go back to the patient in any way. The master cell bank is made. It is pure, uniform. We just initiate a manufacturing process, make a trillion cells. That is thousands of doses. Start treating patients. For the next stage, I'll focus on two programs that have been advanced in our pipeline. FT819, the 8 stands for CD8. Nineteen stands for the targeting CD19. 819 is a CD8 cell targeting CD19. When we made this program, two things were happening. First, we spoke to Michel Sadelain in 2015 and said we wanted to develop drugs for iPSCs. He really gave us, sorry, should I switch to this? Okay, that's what I'm doing. Sorry. Here we go. The first thing we did is we went to Michel Sadelain and said we want to make T cells. He was our biggest critic. We really had to focus on making true T cells. The first part of the derivation of FT819 is the fact that we went after a CD8 alpha beta-like T cell. That was very challenging. It took us six years. It was an effort worthwhile, because we had now the right chassis. We had a true T cell chassis. The second part was back in 2017, 2018, and even today, CAR-T cell toxicity was a big issue. You do not want to have neurotox. You do not want to have CRS of grade three and four. We fine-tuned the product to have CAR activity that was measured in terms of providing efficacy, but also maintaining safety. The items two and three of this CAR motif have been altered so the signaling is not as aggressive into the T cell. T cell expansion is in moderation. It allows you to be a safer product, because the last thing you want is an off-the-shelf product to have toxicity issues. The second part of that is that we put the CAR into the TRAC locus. Instead of having the traditional overexpression of the CAR elicited by a synthetic promoter, we actually used it to be controlled by a biology of T cells by the TRAC gene. Here is moderate levels of CAR and a CAR expression that's been fine-tuned for activity. We have great safety. We have activity. We went into aggressive DLBCL. Here in DLBCL, we gave three days of conditioning coupled with FT819, a single dose. We saw the first thing we wanted to see, the safety. Safety was pristine. In the patients we treated, we did not see CRS higher than grade two, so grade one or grade two, no ICANS, neurotox, and no GVHD. Check that off. The second part was we were looking for activity. We did see activity. We saw something about 25% CR rates in aggressive DLBCL. That went to 40% if you enrich the population for CAR T-naïve. That went to 40%. That is good. We saw activity. This activity was not competitive enough with auto CAR T. When you hear about FT819 in the next series of slides, you will see why we switched over to SLE. I hope the rationale makes a lot of sense for you. The most important thing to take away from this is 50 patients treated, safety profile pristine, and activity there, but not competitive enough. We knew why, because we had controlled the CAR activity. In general, you see PK performance very similar to CAR T in lymphoma. At 360 million dose, you see a very good peak and contract with the product. Expansion and contraction spanning about two weeks. We saw in lymphoma other attributes that made it more preferable to start thinking about SLE. B cells were well controlled during the treatment cycle. As you can see here, B cell depletion was very well regulated. We saw deep and sustainable B cell elimination. Also, we saw signs that FT819 may not be as dependent on conditioning as it may have originally thought for a CAR-T cell. Here, in patients where they were treated with Cy/Flu, they still were resistant from a B cell perspective, resistant in the periphery to elimination of Cy/Flu. Only when we added FT819, we saw a massive drop. Here, we saw anti-B cell activity without the need of the conditioning agent. That gave us a unique perspective. We can get rid of B cells. We may be somewhat independent from conditioning regimen. Also, we saw that not only Cy/Flu worked, but also combination with bendamustine worked as a conditioning strategy. We thought about SLE. Right around 2022, 2023, Schett data was starting to roll out. It made a lot of sense to go after a B cell disease that has lower disease burden. In aggressive lymphoma, we're fighting about 5 pounds of cancer, 10 to the 10 cells. Here in SLE, most likely 10 to the 8, maybe 10 to the 9 cells. A different disease threshold. You start thinking, would it make sense to take FT819 that was built off safety and efficacy to a lower degree to go into a disease setting that actually gave you the right Goldilocks perspective, the right efficacy, but still maintaining very good safety profile? In fact, this is what we initiated. Regimen A was either with cyclophosphamide, fludarabine, bendamustine, or cyclophosphamide. Regimen B is actually 819 on top of maintenance therapy, MMF, AZA, methotrexate. These are patients that are being maintained on maintenance therapy. The hope is that by adding 819, you can come off of maintenance therapy. This is what Benlysta and other drugs currently approved, that's their approach. Again, same thing here. We started. What we noticed right off the bat, cyclophosphamide, fludarabine, something that's being used in autoimmune disease by many others, was not preferred by physicians when they had the option of bendamustine or cyclophosphamide. Keep in mind, cyclophosphamide is something that rheumatologists give to patients on a regular basis, part of standard of care therapy. The focus fell on bendamustine and cyclophosphamide as the conditioning agents for regimen A, single dose of 819. Again, I do not want to repeat myself, but very differentiated from all of the cell therapy approaches because of all these things that are listed here, as I mentioned earlier. Just truly an off-the-shelf product. When we looked at some of the translational data, we saw that when it came to PK, we saw detection of the product. We did not see the same PK as we saw with cyclophosphamide and fludarabine in oncology. Keep in mind, it is the same drug product. Without fludarabine, we did not see the same PK. That is either associated with fludarabine not being there or the fact that the disease burden is lower. There is less antigen-mediated expansion. Regardless, we saw that in all three patients that we reported at ASH in the first month, we saw the B cells come down and stay down. There was recovery after 30 days. We think that was enough time to elicit a response. B cell depletion goes down here, and it comes back up. I'll be talking about in the next slide the blue line patient one. At ACR and ASH, we gave a six-month update on patient one. Here are some kinetics on PK, good depletion, and recovery. The first thing we were worried about was the patient started with about 25 B cells per microliter. Usually, you want to be above 100. Most of us have over 100 for normal ranges, but between 100 and 1,000. When we started seeing recovery, we were a little bit worried, oh, did we not have enough time to do immune reset? What was very interesting was that it came back. It came back to normal levels. The composition of the B cells were more of the naive nature. It was really a true example of an immune reset where levels go back to normal. The composition is more normal. That was a great sign to see. That resulted in the first patient reaching at six-month point, DORIS clinical remission. This patient really did very well with the therapy. Obviously, again, we saw the safety that we've seen before with the other 50 patients. The patient did not need to go through apheresis and all those other complications that are associated with auto CAR-T. The patient started feeling great. By six months, she had a FACIT score of 51 out of 52. I probably have a FACIT score of 40, the way I sleep. Really, she was feeling great. Her renal functions were back to normal. Her disease was under control. That really gave us a perspective here. We did not need to use fludarabine. We used FT819 in an off-the-shelf manner. We were able to, at least in the first patient, get a response that would actually be very exciting, because standard of care therapy does not give you this type of response. Overall, that seemed like a very good strategy. I think there is a question coming up when we will give updates. We will talk about that in a minute. Switching over to our solid tumor strategy. We are focused on autoimmune and solid tumor, FT825, another off-the-shelf CAR-T cell. This one, we had to go a little bit wild in terms of adding edits, seven edits. That is because solid tumor is very challenging. The tumor needs to be reached. It is in a very unique location. You have to reach it. You have to traffic there. The tumor microenvironment is suppressive. That is why the tumor has been expanding. It created an environment where the endogenous immune compartment could not reach it. Or when it reached it, it could not have activity. The T cells were not targeted properly. Here, we targeted HER2 in a very unique manner. We put into play a series of edits to help us overcome a solid tumor disease setting. Maybe the most important and unique strategy here is that we are targeting cancer in two unique ways. One is the CAR, the chimeric antigen receptor, targeting HER2. The second is a CD16, which is traditionally reserved for NK cells, being used here to now allow FT825 to be combined with a monoclonal antibody to target a second antigen. This unique combination of anti-HER2 and the CD16 with the therapeutic mAB gives us a multi-targeting approach of tumor-associated antigens. That is one of the biggest challenges today in solid tumor. It is heterogeneous. It is not this homogeneous, uniform disease. It is actually very different in its compartments. There are some HER2 positive cells here. There are some HER2 negative cells there. In a preclinical model and an in vivo setting where we create subcutaneous tumors and we measure the tumor volume over time, you can see that the control quickly increases in size, reaching 500 millimeters cubed over a course of about 35 days. If you add Herceptin, you do an anti-HER2 mAB, you do get tumor control. If you add an HER2, you do get a tumor control. If you add CAR HER2, FT825, you do get tumor control. When you combine these two, look at that. That is something that is astonishing. You eliminate the tumor because you've created activity, action, and multi-antigen targeting. We are prosecuting this in the clinic. Our current clinical trial has two arms, a monotherapy arm and a combination arm with cetuximab as a conditioning strategy and combined with a single dose. We hope to update you on this as well. We are very excited because now you're taking the power of CAR T cell and combining it in a unique way to overcome the challenge of tumor heterogeneity. If you have the best CAR-T cell, but the target is not there, it's not going to work. This is where the multi-targeting strategy really comes into play. Maybe the next few slides just on next generation, what was coming in store. We're very good at engineering in very innovative strategies into our cells. I talked about a two-point engineered product with FT819, a seven-point edited CAR-T cell with FT825. We have additional edits to bring into it. Perhaps one of the most exciting edits is our sword and shield technology. In 2016, we started with knocking out class I, class II. Having been an NK company in many ways, we knew missing self was going to be a big challenge. We could not come up with a way to combat missing self. We tried HLA-E, not the best strategy, CD47, not good enough. We moved away from knocking out class I, class II. The cells got a little wonky when we did that. We could not overcome missing self. If you can overcome missing self with one expression of one ligand, then every tumor would be class I, class II knockout expressing that ligand. It is not that easy. NK cells are too smart to just be able to quickly, with one ligand, overcome missing self. What we did was we wanted to take a more active approach. We do not want to sit here and become invisible and hide from the endogenous immune compartment. What we want to do is we want to overcome the need for conditioning. When you give Cy/Flu, not only do you eliminate the host immune system so you avoid rejection, but you also create space. You create a cytokine surplus. And you have anti-disease debulking within the conditioning. It is chemotherapy. You bring in a lot of things into play. If you really want to get rid of chemotherapy, conditioning therapy there, you have to address all those issues. You cannot just be invisible. Even if you figure out how to be invisible, you still got to overcome the other things. Here, we took an active approach. We introduced the CAR, an autoimmune defense receptor published here by Max, where now you actually, when you get attacked, you attack back. It is almost like the Wild Wild West. When the host immune system comes and is about to attack you, it expresses 4-1BB. There are signaling cues, CD69, CD25, CD38. The final one where there is synapse to synapse interaction and your cell is about to eliminate and the host immune cell is about to eliminate the graft, 41BB goes up. That is when we actually, through a chimeric antigen receptor, eliminate the cell that is going to kill us first. You actually protect yourself against the attack. While you protect yourself, you actually also signal the cell to expand because there is a signaling domain within the CAR motif. It is an in vivo expansion arm here. Another thing we did was we wanted to eliminate some of the adhesion interactions as well by knocking out CD58. All these different cell types, through the interaction of CD2, engage with a host disease product or the graft here, for example. We eliminate the interaction. The product protects itself and defends itself and really makes it a much different comparison arm when you think about various ways you want to overcome conditioning chemotherapy. All the pluses are on this side. This is just an example. Here is CAR-T cells without any allogeneic T cells. You can see that they control the disease. When you add allo, you can see that the disease here, the CAR-T without ADR, can no longer protect itself. The CAR-T that has ADR continues to kill. This is very good activity against a very aggressive disease in the presence of allogeneic T cells. This is a picture that's worth more than a million dollars. Sorry if I went over time. No. That's four minutes over. That's four minutes over. It's going the other way. Sorry. This is who we are. Thank you. It's going up. Sorry. Yeah. No, thank you so much for that, Bob. I guess this isn't working anymore. Yeah, I just had one quick question. I know you presented that data from the lupus patients. I believe it was slide 13, if I recall correctly. How are those patients doing now? I know patients two and three were very early. One or two or three months. Even the one that was at six months that is now probably around eight months, what can you say about how they're doing? When can we get a more fulsome update? That's a great question. Everybody's asking that. There's a lot of excitement around it. We want to have a complete story. At EULAR, we'll be giving an update on patients one, two, and three, where patient one is because it'll be reaching a year. And patients two and three, where are they? That's regimen A. We'll also give an update on regimen B, patient one. I think there are some trends there that's worth being excited about. At EULAR, we'll give an update. At ACR, we should have more patients enrolled. We'll give even a larger update at ACR. Great. We really look forward to that. Thanks again for the presentation, Bob. Thank you all for listening. Sorry I went over. Thank you.