Good day, ladies and gentlemen, and welcome to the Agenus Second Quarter 2015 Earnings Conference Call. As a reminder, today’s conference is being recorded. At this time, I would like to turn the conference over to Evan Ballantyne, Chief Financial Officer. Please go ahead, sir.

Thank you and welcome to the Agenus conference call to discuss our second quarter 2015 financial results. Before I continue, I would like to remind you that this conference call will contain forward-looking statements, including statements regarding the company’s potential income stream, research and development, and clinical trial activity, the publication of potential applications of the company’s technologies, and product candidates for the prevention and treatment of diseases. These forward-looking statements are subjects to risks and uncertainties that could cause actual results to differ materially. Reference to these risks and uncertainties is made in today’s press release and they are disclosed in more detail in our most recent filings with the Securities and Exchange Commission. These statements speak only as of the date of this call and Agenus undertakes no obligation to update or revise these statements. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. When evaluating Agenus’ business and securities, investors should give careful consideration to these risks and uncertainties. As a reminder, this call is being recorded for audio broadcast. With me today are Dr. Garo Armen, Chairman and Chief Executive Officer; and Dr. Robert Stein, Chief Scientific Officer. During this call, Garo will provide a corporate update, and I will review our financial results, and Bob will provide an update on our research and development activities. We will then open up the call for questions. With that, let me turn the call over to Garo. Garo?

Thank you, Evan. And thank you, all for joining us this morning. Evan joined Agenus as our CFO recently just in June. He brings more than 30 years of financial and operations experience to Agenus. And will lead our financial, accounting and commercialization– I’m sorry, and communications functions among some other, of course. We are very pleased to welcome him to our senior management team. I’m also delighted to report that the first half of 2015 was a period of important progress for Agenus. In the past few months, we have continued to build on the momentum from the first quarter. More specifically, we consummated additional strategic transactions that expand our immuno-oncology portfolio. We had key data publications and presentations, highlighting the value of our partnered and proprietary clinical stage programs. We built our team across the board. And also our executive team with the addition of Evan Ballantyne as CFO as I just mentioned. We strengthened our balance sheet to be in line with our corporate objectives, and we are well-positioned to advance our programs and partnerships towards key milestones this year. One of our key focus areas continues to be alliances and acquisitions that further strengthen our capabilities across the board with the potential to create best-in-class combination therapies for cancer. As you know, in January of this year, we announced the global hematology-oncology alliance with Incyte, which combines Incyte’s track record of success in drug discovery, development and commercialization with our expertise in immuno-oncology biologics. The Incyte partnership builds on our experience with checkpoint modulating antibodies and is initially focused on four key immune checkpoint targets, GITR, OX40, TIM-3, and LAG-3. In April, we acquired from Celexion the SECANT yeast display platform for the generation of fully human monoclonal antibodies. This further optimizes our antibody discovery and…

Thank you, Garo. I will now review our second quarter 2015 financial results. For the second quarter ended June 30, 2015, Agenus reported a net loss attributable to common stockholders of $40.5 million, or $0.53 per share, basic and diluted, compared with a net loss attributable to common stockholders for the second quarter of 2014 of $7.8 million, or $0.12 per share, basic and diluted. For the six months ended June 30, 2015, the company reported a net loss attributable to common stock shareholders of $59.3 million, or $0.83 per share, basic and diluted, compared with a net loss attributable to common stock shareholders of $8.5 million, or $0.15 per share basic and diluted for the six months ended June 30, 2014. Cash, cash equivalents and short-term investments were $139.6 million as of June 30, 2015. As Garo mentioned, this reflects net proceeds of approximately $74.6 million from our recent offering of common stock. The increase in net loss attributable to common stock shareholders for the six months ended June 30, 2015, compared to a net loss attributable to common stock shareholders for the same period in 2014, and was primarily due to the advancement of checkpoint modulator programs, the $20.7 million non-cash expense from the fair value adjustments of contingent obligations and the $13.2 million charge for the purchase of the SECANT yeast display platform in 2015. During the same period in 2014, the company recorded non-cash non-operating income of $11 million related to the fair value adjustment of a contingent obligation. This concludes the financial portion of the call. I will now turn the call over to Dr. Robert Stein, for a review of the scientific and clinical progress during the quarter. Bob?

Thank you, Evan. We continue to make good progress with our proprietary and partnered programs, including our collaborations with Merck and Incyte. In addition to moving our six publicly disclosed checkpoint modulator programs forward on schedule, we’re making solid progress on five additional proprietary checkpoint modulator programs the targets of which we have not yet publicly disclosed. Earlier this month, we further strengthened our immunomodulatory antibody portfolio by acquiring rights to antibodies targeting Carcinoembryonic Antigen Cell Adhesion Molecule 1 or CEACAM1. And immunomodulatory glycoprotein expressed on the surface of T cells, NK cells, and interestingly on the surface of many tumors. CEACAM1 has been shown in preclinical studies to suppress both innate and adaptive immune responses to cancers. CEACAM1 is over expressed on a number of human cancers, including melanoma and cancers of the bladder, lung, colon, pancreas, and stomach. Antibodies targeting CEACAM1 should reverse immunosuppression and have potentials monotherapies and also in combination regimens with other checkpoint modulators such as PD-1 antagonist circular agonis. Agenus’s CEACAM1 antibody program is a natural fit with our existing portfolio of CPMs, and we will integrate this program into our ongoing efforts to create best-in-class combination therapies for patients with cancer. Other checkpoint modulator collaborations are progressing nicely. As Garo noted, we announced a continuation and extension of our research and development activities with Merck. This extension reflects the considerable progress we have made together, and our shared goal of discovering antibodies against two undisclosed Merck checkpoint targets for use in cancer treatment. These checkpoint targets are distinct from our own checkpoint modulating programs. We look forward to continuing our productive collaboration with Merck in this area. We’re also making excellent progress and collaboration with Incyte. We are on track with our plan to file our first two checkpoint modulator INDs this year,…

Thank you, Bob. We are clearly excited by the advances that we’ve made in the first-half of this year. We look forward to providing additional updates on our activities and expected milestones for the rest of 2015, as well as containing relationships with our partners and any new collaborative opportunities that will arise. We remain committed to developing the next generation of immunological therapies for the treatment of cancer and other diseases. We thank you for your continued support. And with that, operator, you now can open the call with questions.

Thank you. [Operator Instructions] And the first question is from Christopher Marai of Oppenheimer. Please go ahead.

Thanks for taking the questions. First, I wanted to welcome and give my congratulations to Evan, a great team. A few questions really regarding your recent acquisition as the CEACAM1 product, I know your sales milestones for LPs weren’t disclosed in the last press release. I was just wondering if you can provide any more clarity on obviously upfront type of milestone range there, and potentially ranges on the royalties, as well as later sales milestones. Thanks.

Thank you, Chris. At this point, we are not at liberty to provide any of these details with mutual agreements from the party that we acquired. And but they are pretty close to industry standards, nothing remarkable. I think it’s fair to them and it’s fair to us, if you will. Importantly, as Bob alluded to this is a target, where we expect to see additional exciting developments as we go forward. It is a target that has been looked at and I think be reasonable to expect additional validation, if you will, by players in the field of this specific target as we go forward.

Okay, great. Thanks, that’s helpful. And then just regarding those other players in the field and work being done there, I mean, how does this compare to other CEACAM1 molecules and other CEACAM1 targeted molecules out there either in the clinic or pre-clinically? I know, there’s a few other players looking at this. I’m just wondering why you decided to diffuse the molecule and the partner you did, and if there are any other aspects of that partnership, for instance, to develop - sort of standard antibody have you modified, FC reagent kind of cancellation [ph] or have you looked at potential by specificity? Thanks.

Sure. One question, I mean, one remark and then I’ll turn it to Bob. Obviously, we have been quite aggressive with our antennas up, if you will, to look at opportunities in this field. We expect the field to get increasingly competitive. And we within [ph] on an opportunity that well, Bob, will illustrate on that we think is going to be quite competitive in the field. And we believe it’s the best opportunity that we could get our arms around right now, perhaps not the lead product in terms of being a best to the clinic, but pretty close behind, if you will.

So I think it’s a good question, Chris. We have quite a bit of interest in the target. The preclinical and correlative clinical biology and pathobiology are very convincing. We were looking at various options and the antibodies that Diatheva had created at the necessary functional properties that we’re seeking, we have the ability to fine tune them with the platform we have to make truly an expert developing candidates. And we think this will move us down the road quite a bit. This is an area that’s just coming into interest amongst other players. There’s one antibody upfront that helps going into the clinic, but it’s a very early point and the recognition that this is a high quality target.

Great. Thank you.

Thank you. And the next question is from Swayampakula Ramakanth from H.C. Wainwright. Please go ahead.

Thank you. Good morning, Garo, Evan, and Dr. Stein. A couple of questions; one, financials, and one, on the strategy. In terms of strategy, what kind of signs - what kind of steps are still to be completed before we can get the HZ/su we started with Prophage in the newly diagnosed brain cancer?

And then on the financials part of it, when we look at the second quarter financials, you see that the operating expenses have raised, mostly because of the non-cash part of it. But I’m trying to understand, what’s the real expenses and what’s the non-cash expenses there? And how should we think about this, because I’m trying to understand how the cash on the stock by considerations for the SECANT acquisition?

Well, it’s been here. I just want to give you some insight into cash burn. The net cash from operating activities for the company for the six months ended June 30, was approximately $9.6 million. If you take out the revenue or the revenues associated with the insight deal and add back the milestones from the 4AB, it come up with a cash burn for the six months ended June 30, 2015, for approximately $23.6 million, for about $4 million a quarter, that’s helpful, $4 million a month, sorry, a month.

That’s very much on target with the guidance we’ve provided before. Even before there was, Evan, the guidance we have provided. Thank you, Evan.

Okay. Okay, thank you. I’ll step back and get back in the queue.

Thanks.

Thank you. And the next question is from Arlinda Lee from MLV. Please go ahead.

Hi, guys, thanks for taking my question. So on the glioblastoma, Garo, you mentioned that you had expected funding from a third-party to [indiscernible], is that being that you will be doing and studying more broadly in all comers type of trial. And then maybe can you provide an update on GSK’s regulatory plans, basically, they are going to update something this year, is that still on track for the HZ/su vaccine? Thanks.

Okay. So let me do the GSK part, and Bob will elucidate a little bit on the specifics of the kind of trial that we’re planning on doing for Prophage. As you know, in the research day, GSK specifically said that they expect DMA decision this year, and we very much anticipate that will happen, that’s number one. And in terms of timing for malaria after this decision by DMA, there will be additional bodies that will have to provide their blessings, one of them is WHO. And after that happens, which we expect to be happening judiciously after DMA decisions, then they need to go to individual countries in Africa and get clearance in those countries before they market the product. So now, I don’t want to speculate necessarily, but that process will take some time. That process will take some time, it won’t be a quick process. And even though I believe that it should be a quick process, because these children that are vulnerable will benefit a great deal from a product such as this, vaccine, such as this. But the best estimate right now is, perhaps, the product launch will not take place until early 2017. In terms of shingles, shingles trial was quite definitive in terms of vaccine. Now GSK provided guidance in their - unfortunately, I cannot elucidate any more than what they have provided, provide guidance that they expect to file next year and get approval sometimes thereafter. So that’s all we can say right now about the shingles product. Bob, this time, if you can give us some guidance on Prophage and the kind of trial that we are anticipating.

Sure. It’s a good question. Our plan is to take Prophage forward into a Phase 3 in newly diagnosed glioblastoma multiforme. We will measure the level of PD-L1 on the peripheral blood monocytes patients when they enter the study, and we will take an approach to stratification on that basis. But we will take all comers with newly diagnosed glioblastoma and an acceptable level of resection, and the other criteria that we have for performance status, et cetera, because we need to have clarity about where the right cutoff is for the level of elevation to PD-L1 that somewhat blends the efficacy of the vaccine and the group that responds most robustly. So that won’t take any longer to enroll that study, because otherwise you would leave out people with more elevated PD-L1. It does increase the expense, but it improves the chance of getting appropriately characterized, and a registered product with the right guidance on how to use it and in which patients.

Okay great. And just a follow-up on the PD-L1 measures, are you going to commercially available measure, or are you going to develop a companion diagnostic as well? Thanks.

Well, it’s a very important question. That’s one of the things we’re working very hard to make sure that we have kneeled down and that will be our requirement before we can launch a study. The good news is that there are several assays already created in well-established central laboratories that are CLIA certified and have been used in supportive clinical trials. We’re leaning towards one of those, but we have two that we’re looking at right now.

Thank you.

Sure. Thanks for the question.

Thank you. And the next question is from Gabriel Joe [ph] from Maxim Group. Please go ahead. Ms. Gabriel Joe, your line is now open. Please go ahead.

Thank you for taking my question. So my question is more on checkpoints, in terms of checkpoint antibodies. Agenus appears to have the largest attraction of antibodies, certainly now with the CEACAM1 antibody. So people always like to talk about PD-1, PD-L1 and CTLA-4, can you talk a little bit more about what types of tumors that express targets for the checkpoint antibodies, because they are very different from what people are typically used to hear?

Well, I think that, it’s a very interesting question. Some of our targets like CEACAM1 are expressed broadly on a number of tumor types. CEACAM1 is very interesting. It has two slight variants, one of which has the internal inhibitory squealing [ph] capability. The other is just expressed on the surface of tumors as ligands. And the interaction between CEACAM1 on the tumor, it actually binds to CEACAM1 on lymphocytes more on NK cells. And that interaction shuts down the lymphocyte of the NK cell. So that’s an unusual type of interaction that’s almost dimeric [ph] interaction. And the objective with the antibodies is to block that interaction. So that’s one type and that is sort of unusual. PD-L1 obviously gets up-regulated on a number of tumors. There are internal signal transduction pathways that lead to that. And also the exposure to gamma interferon in the tumor which is one of the consequences within odd - other types of T cells, can up-regulate PD-L1. So some tumors have up-regulated PD-L1 at baseline. Almost certainly if we go that effective immune response against the tumor you’ll get PD-L1 up-regulation, which is one of the reason why PD-1 is a pretty important component of regiments. Now it maybe if you want to block PD-1, you might want PD-L1 or both, because PD-1 has two ligands, PD-L1 and PD-L2. And PD-L1 has two receptors, so either one of them completely blocks the pharmacology of the other. And there is actually some rationale for, I think, you guys using PD-1 and PD-L1 interventions together. It’s becoming fairly clear that some tumors have a fairly heavy mutational burden and the immune system has an easier time recognizing those. And if you encounter a patient who already has disseminated disease it’s probably because the tumor has…

Thank you. It’s really helpful. Actually this question is from Jason Cobbler, and he is now travelling the Australia. But thank you again for taking my question.

Well, thank you, Gabriel [ph].

Thank you. And the next question is from George Zavoico from JonesTrading. Please go ahead.

Hi, everyone. And Evan, welcome to the group. Question, follow-on to the last question about CEACAM1. Can you talk a little bit about the normal expression of this protein and what you might expect as events from off target interactions?

Most relatively cleanly expressed on sales of DNA and adaptive immune system. As I mentioned our two forms of the molecule that have slight variance one of which has an internal inhibitory domain and interestingly after NF kappa b activation, the long form comes up on lymphocytes. And so since GITR, should be NF kappa b one of the powerful consequences of activation of GITR either through the natural presentation of GITR ligand as presenting cells or from Agenus antibodies might be up-regulation of the inhibitory CEACAM1 on lymphocytes. So it’s a natural thing to think about combining with our other products in the attempt to stabilize and propagate useful immune responses to tumor. Looks like it’s going to be a pretty clean ranging from the pre-clinical data.

So it sounds like it’s natural biological role is just like check point inhibitor from the temporarily immune response doesn’t get over blown and began damaging normal bi-stand results is that what you think?

I think, that’s exactly right, George. I think it’s a portion of the damping mechanism that prevents immune response over shield. And the tumors have cleverly turn it out happen to that to avoid the destruction.

And then, you just mentioned combining it’s look like you’re predicting GITR antibody. What about similar toxicities with some of the others like there has been seen with - and the PD-1, any evidence that some combinations may not be effective or may cause toxicity?

I think it’s an important point. I think that’s not fully worked out yet, and that will be part of our job, it’s to make sure that we have a good understanding of the potential combinations of both efficacy and our target side effect. So that we can try to achieve high efficacy with an appropriate level of terrible level of bystander tissue damage.

And Evan, you mentioned you might use your platforms to optimize antibody, but I’m presuming you’re not disclosing when you might be able to actually identify new antibody candidate because it’s hard to predict how long that might take, is that pretty much the case?

You supposed correctly.

Okay. And then final question regarding the antibody business, now you have two complementary platforms, you have Merck and Incyte on board is part of your business plan to seek additional partners to use those platforms to find antibodies of interest perhaps even outside of cancer, with other partners.

Well, we have focused very strongly on building world-class capabilities and antibody generation and optimization both were binding characteristics and they’re across coupling to other downstream functions like the interactions with various FC receptors either using macro or modified FC fragments. We also have in the context of the mammalian display system, you are able to select the antibodies are very well behave pharmaceutically from the standpoint of expression level, stability, lack of aggregation, germline sequence, fully committed germline sequence. And so there is an opportunity for putting all this together to leverage it by working to find high quality antibodies with partners. We are not interested in doing that as a service function, but we are interested in ways, which we participate upside creation through the application of what we work so hard to make world class.

Okay. It sounds like little bit more creative to your own objectives with regard to antibodies you’re developing rather than into, say, a service function.

Yes.

Okay, great. Okay. That’s all for me. Thank you all very much. Look forward to continuing progress.

Thanks, George.

Thank you. [Operator Instructions] And the next question is from Larry Smith from Smith on Stock.com. Please go ahead.

Hi, thank you for taking the question. I have a question on PD-L1 expression. I know that, you’re going to have a large sample and newly diagnosed GBM or recurrent GBM, but based upon what you have seen and based on any other information. What do you think the distribution is going to be from low to high expression of PD-L1. Do you think it’s going to be highly secured in population support high expression or will it be a normal distribution. Do you have any sense of how much you’re going to work?

Yes Larry It’s a good question. And so, there are two aspects to it. What we measured in the study was the level of PD-L1 expression on peripheral blood white cells of the monocytes mixture. And we also in the same patients received tumor infiltrating macrophages where we could measure the same thing, what percentage of those cells were over expression in PD-L1. And since the monocytes are the source for the tumor infiltrating macrophages is reasonable, they are correlated and they did turn out to be very correlated if you were high in the peripheral blood on the monocyte to even higher in the tumor on the macrophages. So, that’s suggested there is real biology that we’re looking at. And furthermore we look at the distribution of increased levels of expression in the patients that we sampled which is 32 out of the 46 in the study. And the range is actually quite uniformly distributed, and it isn’t skewed. Where we think the cutoff was the median, so half the patients are above this level and half the patients are below. So, this is with that median as the cutoff we can see a very clear suggestion that the additional Prophage with standard of care has very observable benefit in the patients with the less elevated PD-L1. And just to give you some response on it. Normal Agenus controls of about 5% to 10% of their monocytes expressing PD-L1 about what we consider a threshold level of activation. In these patients, the range is between about 10% and 84%, and 54% was the median. So, half are about 54%, half are below. So, it defers to be a fairly, evenly distributed parameter.

Thanks. Well, okay. Thank you. I have another question, just this is question broadly on cancer vaccines. But maybe it is incorrect. I think you recalled when you came to Agenus, that your enthusiasm for Prophage was not really high, but grew stronger and stronger of, as you gain more data and that kind of corresponds to what the investment community attitude and perhaps the pharmaceutical industries attitude is towards the cancer vaccines. Two, three years ago, I think very few people thought there is much prospect for them. Now, you are talking about the Phase 3 trial and we have some other situations where there is obviously a lot of investor interest and some pharmaceutical industry invest in cancer vaccines. Could you walk us through what you think is happened over the last two or three years to the industry view of cancer vaccines and that pretends to be a major treatment paradigm?

Yeah. I think that is a really good observation and a very good question. Basically, Larry, you’re right when I came to Agenus a year and a half ago I was pretty skeptical about the prospect for the cancer vaccines and I have to say that part of those just because I wasn’t really on top of all the underlying scientific rational for Prophage. And I would now as I’ve learned more and as the data have continually involve from the studies that we’ve run. I believe that it’s actually a very stood way into creating individualized cancer vaccines. It’s also very clear that using next-gen sequencing and analyzing the nature of tumor infiltrating lymphocytes that the most important handles for the immune system to recognize cancers is that normal are the individual mutations that have occurred as part of the tapering of the genome with mutations, either point mutations or frameshifts and those are the things for which you have the possibility of having still that high affinity T-cell receptors in your immune repertoire. Some of the things that we’re considered promising like the testing for their crypto antigens like [MAEJ-3 or MIE-silwaterprem] [ph] you do get a topic expression in places that don’t normally put those proteins into play. But the problem is that you probably gotten rid of all life in T-cell receptors during biomake ontogeny. So, you don’t have the ability to really generate high affinity T-cells directly against those antigens. So, I think that there were two things. One is understanding that some patients have so much mutations, tumor already, that they’ve already jumpstarted the immune system, they don’t actually need a vaccine so toxicity of benefit those. Some have so low little mutational burden that they don’t have enough difference from cells to be…

Thank you. That’s a very elegant answer. I guess I could ask one other question. If I’m telling you [ph] correctly, you’re giving guidance, but you’re going to go into the Phase 3 trial with Prophage. And newly diagnosed GBM that you’re going to line up site funding for them. That’s suggest to me that there is a high level of confidence on your part that you can find a partner. Am I reading that correctly?

Yes.

And I’d say there is certainly a lot of interest especially in the wake of the prospects CTLA-4 result. And our strategic consideration is that correct task we don’t want to short change on CPM programs. But if our cash situation changes dramatically you made the side differently good Prophage, it’s a very high quality opportunity and if you think about it as the end result of two decades for the investment of effort and money, and the fact that all the skids are greased including the release facts and safety database, it’s been in over 1000 patients worldwide. There is a considerable argument to be thought to about whether we fund our partner.

I mean you read the comments correctly, Larry, there is interest - significant interest and the choice will be ours, if we can go that way, I mean this is an opportunity where we can become a commercial company we work and marketed ourselves very quickly, it doesn’t mean that we still cannot do this, where they create a partnership setup, whether it is a financial partner and we retain all of the commercial rights or it’s a commercial partner, where we retained right at least for North America.

If I could just, probably from one other question. Is that the case that the interest is enhance from one or two companies or is that the case that the board interest across biopharma, big biotech and big pharma. And perhaps even financial players to fund the trial?

I think it’s all of the above.

Pretty amazing. Thank you.

Thanks, Larry.

Thank you. There are no further questions at this time. Please continue.

Hello, it’s Evan Ballantyne again. I’ve been asked to reiterate our forward-looking statements comments, and including the fact that the company has made forward-looking statements of our potential income streams, research and development and clinical trial activity. And the publication of data potential application of the companies, technologies, and product candidates for the prevention and treatment of disease. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Reference to these risks and uncertainties was made in today’s press release and they should - they are disclosed in more detail in our most recent filings with the U.S. Securities and Exchange Commission. These statements speak only as of the date of this call and Agenus undertakes no obligation to update or revise these statements. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. When evaluating Agenus’ business and securities, investors should give careful consideration to the risks and uncertainties. And I’d like to thank the operator and everybody for attending the call. This conference will be replay is entirety approximately two hours on the company’s website at www.agenusbio.com, on behalf of the management team at Agenus. I’d like to thank everybody for joining us on today’s call. I’ll be available to receive any further enquires following the conclusion of the call. And with that operator, please conclude this call. Thank you.

Thank you. Ladies and gentlemen. This concludes the conference call for today. We thank you for your participation. You may now disconnect your lines. And have a great day.