Greetings, and welcome to the ZIOPHARM Oncology Second Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Chris Taylor, Vice President of Investor Relations and Corporate Communications.

Thank you, Operator. Good afternoon and welcome to the ZIOPHARM Oncology conference call and webcast to review results for the second quarter ended June 30, 2020. This afternoon we filed our 10-Q and issued our second quarter financial news release, both of which are available in the Investors section of our Web site, ziopharm.com. For informational purposes, we have also included in our webcast a set of PowerPoint slides to accompany today's commentary. These slides can also be found on our Web site in the Investors section. During this call, the company will make a number of forward-looking statements, including statements regarding the potential therapeutic candidates in our development pipeline, regulatory status, financial information, and business trends. Forward-looking statements are subject to numerous risks and uncertainties as described in our 10-Q and within other filings that we may make with the SEC from time to time. Participating on our call today for ZIOPHARM will be Dr. Laurence Cooper, Chief Executive Officer; and Sath Shukla, Chief Financial Officer. Following commentary from our management team, we will open the call for Q&A. In the interest of time, we kindly request that you ask one question and a follow-up as needed, and then please feel free to return to the queue. Thank you. And to get started, I'll turn the call over to Dr. Cooper. Good afternoon, Laurence.

Thank you, Chris, and good day everyone. We are pleased to update during on our progress this quarter, a summary of which is provided on slide number three. COVID-19 continued to dominate the new cycle and impact everyday life this quarter. We are working within the local and regional guidelines to keep our employees safe. We have adapted to the new paradigm, and we are executing on all fronts. We are mindful that the pandemic is ongoing, and may need to further adapt in the future to the changing landscape. First, I will provide a review of our programs, specifically at the NCI and MD Anderson. Starting with our TCR-T program, where we continue to advance towards the dosing of the first patient in this Phase 2 trial led by Dr. Steven Rosenberg at the NCI, all feel an urgency to begin dosing as quickly and safely as possible, and the NCI has informed us that laboratory functions are incrementally coming back online. As mentioned on earlier updates, we undertook engineering runs at our facility in Houston, while the NCI was shutdown, and have now relayed that information back to Dr. Rosenberg's team to help the NCI accelerate their enrollment plans as they reopen during the ongoing pandemic. In addition, they're beginning to proactively screen referrals for patients to neoantigens and T-cell receptors or TCRs to render them eligible for the trial. This is needed. As a result of the pandemic and resulting shutdowns, some of the patients who were anticipated to be treated were unfortunately lost due to progression of their malignant disease. We appreciate the NCI's strong support, and look forward to updating you on their progress. Now, turning to our TCR-T program that we are running from ZIOPHARM's facilities alongside the MD Anderson Cancer Center campus in…

Thank you, Laurence, and good afternoon everyone. Let me start with a quick review of our financial results for the quarter. As noted in our news release research and development expenses were $12.1 million for the second quarter of 2020, compared to $10 million for Q2 of 2019. The increase reflects increased headcount, including the recruitment of key personnel to expand our capabilities to support the growth of our cell therapy business, and an increase in gene therapy trial expenses and contracted support services. G&A expenses were $6.6 million for the second quarter of 2020, compared to $4.8 million for the second quarter of 2019. The majority of this increase reflects on increased recruitment of key personnel expanding our capabilities to support the growth of our business and to a lesser extent, other associated costs, such as legal and facilities expenses. On accumulative basis for the second quarter of 2020, we reported a net loss applicable to common shareholders of $18.6 million, or $0.09 per basic and diluted share, comparably in the second quarter of 2019, ZIOPHARM recorded net loss applicable to common shareholders of $14.6 million or $0.09 per share basic and diluted. Cash and marketable securities as of June 30 2020, was $153.5 million. In addition, we also had a prepayment balance of approximately $14 million for work to be conducted by the company at MD Anderson. Consistent with the prior disclosures, our cash position is forecasted to be sufficient to provide funding for our programs and infrastructure built into mid-2022. With that, I will turn it back to the operator for questions.

Thank you. At this time, we will be conducting a question-and-answer session. [Operator Instructions] Our first question is from Chris Howerton with Jeffries. Please go ahead.

Great. Thanks for taking the questions, and hope that all you are well on the ZIOPHARM team. So, I think for me, the key question would just be kind of when can we expect the next IL-12 data, particularly in GBM, and when can we start to kind of crystallize the regulatory path with -- in that indication for that asset?

Yes, thanks, Chris. So, for the IL-12 data, our practice has been for the last several years to present both at ASCO, which we did earlier this year, and then also at SNO, which is later in the year. Those two conferences offer an opportunity really to showcase our technology, and I think we'll still keep to that rhythm. We do have other opportunities in between that at investor conferences to provide other insights into the program. The regulatory path is important of course to us, and the monotherapy data that we reported out at ASCO really represents both the main study, as we call it, and the expansion study, and no more patients are being added to that dataset, and that data reported in at ASCO quite favorably with about 16 or so months of overall survival. That data therefore, we expect to continue to mature through the year, and continue to look good through the year. The combo data with OPDIVO, that's the sort of Phase 1 trial, and then the Phase 2 trial with Libtayo, those data are less mature, because they started after the monotherapy data. We reported an initial snapshot at ASCO with the OPDIVO data that actually looked again quite favorable with the median overall survival not being reached. We continue to track those patients, Chris, and then we'll report out how those patients are doing through the year, as I mentioned, a major conference being SNO at the end of the year. Once the company has that dataset, the monotherapy, which is basically there and the combo dataset, which has really now added value to the company, because the monotherapy looks so good, the company can then look at where the next steps are, and we'll have potentially two shots for regulatory approval. The first is the monotherapy dataset, and the second is the combination dataset, and I want to look at with my colleagues and with the Board, how the monotherapy stacks up versus the combination therapy, but again, just to emphasize, the company is feeling pretty good at this point because we already have that monotherapy data basically in hand and the combo, it looks to us only on an upside, if you would.

Yes, okay. That makes sense. Yes, and the maybe if I may, just one more question with respect to kind of what in your -- if you could describe the differences between what the NCI IND is and what your ZIOPHARM IND will eventually look like, and what kind of the key differences and gating factors to kind of get that in?

Sure. So, the IND with Steve Rosenberg is an IND that's sponsored by the NCI, and is an academic IND, and builds on Steve's work with us as a partner. Our IND is our own, essentially corporate-sponsored IND, and that IND, as I guided just on the call today, has some significant benefits for us, and that we can initially use that IND for multiple targets and multiple TCRs. Therefore, the CMC package that we are putting into that IND will cover both trials. In other words, the library trial where we're targeting shared neoantigens with, if you would, a set or a library of TCRs, as well as the personalized trials, in which, patients are receiving one or more TCRs for going after one or more of their own private mutations. So, that guidance here for the Street is actually a big advantage for us, and it's something that we can take advantage now within our corporate structure as we roll out these two trials, not one trial, but two trials, under our banner initially beginning with enrollment at MD Anderson.

Okay, all right. Well, very good, and again, thank you so much for taking the questions, and really, really great to see all the continued progress despite all the COVID stuff that we are all dealing with.

Yes, thank you so much, Chris. Yes.

Our next question is from Thomas Flaten with Lake Street Capital Markets. Please go ahead.

Good afternoon, guys. Thanks for taking the question, just a follow-up on the question about the IL-12 regulatory strategy. What's the recency of your conversations with FDA around that, and have they given you any guidance or hints as to what they would feel would be appropriate, or are they also waiting for the datasets, and so, this is a kind of mid-2021 activity from an FDA discussion perspective?

Yes, thanks, Thomas. So, we've had initial conversations with the FDA on the Phase 3 pivotal trial, and that initial conversation was based on us pushing our drug candidate or candidates, as I've mentioned against in a randomized trial against essentially best practices. As you know, the treatment in for recurrent GBM, it has basically very few therapeutic options and we have looked at that data. In other words, what are sort of the best available treatments that patients can get. And it ranges, it ranges from somewhere between six to 12 months depending on the study and the people reporting out the data, our current monotherapy beats all of that, 16 months of overall of median overall survival. So, as we look to the pivotal trial, if we're going to do a randomized trial, we feel pretty good about it because we now have a sizable number of patients in both the monotherapy as well as in the combination therapy, and certainly from the monotherapy data with the data now really maturing quite nicely, it looks good compared to quote, what would be a randomized control. So therefore, our initial thought about how we move forward is with that preliminary conversation with the FDA. I would say though, that the data has matured a lot. Since that conversation, we have MRI scans, we have increasingly a larger pool of patients, and I think there are opportunities to go back to the FDA and share with them some of our data and get essentially refinements about what that pivotal trial will look like.

Do you think though if we look across and I know it's a different disease states and different drugs, but if you look at the checkpoint inhibitors in particular, they've been getting away with very single arm open label studies in the small number of patients given unmet needs? Do you think there's an opportunity there to leverage some of the learnings from other drug classes and other disease states just to kind of advance the program more quickly?

Yes, I think ZIOPHARM has two opportunities to advance the program more quickly, the first just is your guiding Thomas and that is continued conversation with the regulators. And the second is our campaign for pontine glioma, DIPG, and there is unfortunately an opportunity because these children die so rapidly, and with so little available to them, there really is no opportunity to randomize in that setting. You can't randomize against nothing, kind of thing. So, there are opportunities in both camp, both by extending the program from a potential drug for GBM into a platform and then to essentially evaluate with the regulators how the drug might be on a faster track for that recurring GBM setting.

That's super helpful. Thanks so much.

Our next question is from Yale Jen with Laidlaw & Co. Please go ahead.

Good afternoon, and thanks for taking the questions. To follow-up a little bit on the previous one in terms of DIPG, given this is a pediatric indication, is there a difference in terms of treating the patient for instance, the [indiscernible] use or other factors will you take into the study design?

Yes. Thanks, Yale. That's a good question. So we learnt a lot from treating the adult patients with recurrent GBM particularly the role of steroids in the dosing of the IL-12 in veledimex, that learning has been applied to the pediatricians taking care of these children with DIPG. So they now have a essentially all of that data available to them. And we can work with the physicians to do just what you're suggesting and that is limit the amount of steroid use for these kids, so that they can get the maximum potential benefit from IL-12.

Okay, great. That's helpful. And maybe just tackle one more question here, which is that in MD Anderson, you do have this library, you suggest that, that could be a quicker way to solve the TCR-T study, and then, could you describe a little bit more in terms of the scope and potentially the size of this library at this point. I understand it's sort of growing situations sill stacked up to this moment?

Yes, Yale, I'm glad you mentioned it. The library is essentially a collection of TCRs that are against mutations in p53, KRAS and EGFR. That library was in-licensed from the NCI and we already have it in our arsenal, and in fact, it's of sufficient size to already begin enrollment. Because that library essentially has been gathered so quickly and now our team in Houston can essentially kick the tires on that library and make sure and authenticated does what we think is going to do. We can accelerate our program to put patients into the trial to benefit from that library of TCRs. We recognize of course, that the larger of the library, the better the chance of a given patient with for instance, p53 mutation or a KRAS mutation could benefit. So we're not only going to continue to in license the TCRs from the NCI, but also we have a whole program built out in Houston now to essentially expand the library under our own auspices, and that's an important part for the company and a way essentially to track progress for our company is the size of that library. You know, today, obviously for competitive advantage, we can't reveal the number of TCRs and so forth, but I can give reassurance that it's a sizable number, and indeed, it's sufficient to begin the trial and I can further go on and say that we're quite strategic about the way we are building this library. We know for instance, some mutations are more representative than others. We know certain HLA are more popular than others, and we can essentially use our resources carefully to build a library, so we have the maximum chance of enrolling a particular patient to this trial.

Okay, great, and again, congrats on the progress in this difficult time.

Thank you.

Our next question is from [indiscernible] with H.C. Wainwright. Please go ahead.

Thank you for taking my question. This is [indiscernible]. Just regarding the TCR-T trial both at the NCI and MD Anderson, could you guys remind us, do these also use their RPM technology or it's only applied to Sleeping Beauty?

Yes, that's great [indiscernible]. Thank you for a name we need to clarify. So the RPM technology, the rapid personalized manufacturer enables T cells to be genetically modified on one day and then simply infuse the next day. That technology is built off two pivotal pieces, the Sleeping Beauty System, and a molecule called membrane bound IL-15. We have tested both Sleeping Beauty and membrane bound IL-15 in the CAR and in the TCR space, and we can show in both essentially, a gene types if you would, that the technology works. We are initially testing, but RPM technology in the CAR-T space in clinical trial. So, in other words, we're doing our Phase 1 trial both in the United States and in Taiwan using the CAR-T RPM that learnings can then come back and inform on whether we're going to use the RPM in the TCR space, but again, I would emphasize that we've done a lot of the preliminary work and if the value of IL-15 for TCR looks pretty good as we showed a dash in publication last December.

Thank you for that and congratulations on the progress.

Ladies and gentlemen, thank you for joining. I would like to turn the conference back over to Dr. Cooper for closing remarks.

Thank you, Operator, and thank you everyone for joining us today. We certainly hope you're safe and well and look forward to updating you through virtual investor conferences over the next couple of months during our fall R&D event, and on our next quarterly call. Good day, everyone.

This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.