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Item 1. Business

2023-03-30 compared with 2022-03-23 · 241 added, 213 removed, 511 unchanged (47% of the section changed)

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Our pipeline is currently focused in three core areas:

gene therapies for rare genetic disorders, chimeric antigen receptor (“CAR”) engineered T cell (“CAR T”) therapies for hematologic malignancies and CAR T therapies for solid tumors.

CAR T therapies for hematologic malignancies, CAR T therapies for solid tumors and gene therapies for rare genetic disorders.

For each therapy we have partnered with world class research institutions.

For our gene therapies, we have partnered with St.

For our CAR T therapies we have partnered with the City of Hope National Medical Center (“COH”), Fred Hutchinson Cancer Center (“Fred Hutch”), Nationwide Children’s Hospital (“Nationwide”) and the Mayo Foundation for Medical Education and Research (“Mayo Clinic”).

For our gene therapies,

we have partnered with St.

Jude Children’s Research Hospital (“St.

Jude”) in the development of a first-in-class ex vivo lentiviral treatment of X-linked severe combined immunodeficiency (“XSCID”) and with Leiden University Medical Centre (“LUMC”) for RAG1 severe combined immunodeficiency (“RAG1-SCID”).

For our CAR T therapies we have partnered with the City of Hope National Medical Center (“COH”), Fred Hutchinson Cancer Research Center (“Fred Hutch”), Nationwide Children’s Hospital (“Nationwide”) and the Mayo Foundation for Medical Education and Research (“Mayo Clinic”).

Gene Therapies

In partnership with St.

Jude, our XSCID gene therapy programs (MB-107 and MB-207) are being conducted under an exclusive license to develop a potentially curative treatment for XSCID, a rare genetic immune system condition in which affected patients do not live beyond infancy without treatment.

This first-in-class ex vivo lentiviral gene therapy is currently in two Phase 1/2 clinical trials involving two different autologous cell products:

a multicenter trial of the MB-107 product in newly diagnosed infants sponsored by St.

Jude and a single-center

trial of the MB-207 product in previously transplanted patients sponsored by the National Institutes of Health (“NIH”).

In January 2021 we received approval to proceed with our Investigational New Drug (“IND”) application with the U.S.

Food and Drug Administration (“FDA”) to initiate a pivotal non-randomized multicenter Phase 2 clinical trial of MB-107 in newly diagnosed infants with XSCID who are under the age of two.

In January 2022, the FDA issued a hold, pending Chemistry, Manufacturing and Controls (“CMC”) clearance, on our IND application to conduct a pivotal non-randomized multicenter Phase 2 clinical trial of MB-207 in previously transplanted XSCID patients.

CAR T Therapies

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Phase 1 clinical trials sponsored by COH for MB-102 and MB-104 and by Fred Hutch for MB-106 are underway.

In the third quarter of 2019 the FDA approved our IND application to initiate a multi-center Phase 1/2 clinical trial of MB-102, and our clinical trial began enrollment in 2020 for the treatment of patients with blastic plasmacytoid dendritic cell neoplasm.

In May 2021, the FDA approved our IND application to initiate a multi-center Phase 1/2 clinical trial of MB-106, and we expect to begin the treatment of patients with non-Hodgkin lymphoma and chronic lymphocytic leukemia in the first half of 2022.

In July 2019 the FDA approved our IND application to initiate a multi-center Phase 1/2 clinical trial of MB-102, and our clinical trial began enrollment in 2020 for the treatment of patients with blastic plasmacytoid dendritic cell neoplasm (“BPDCN”).

In May 2021, the FDA approved our IND application to initiate a multi-center Phase 1/2 clinical trial of MB-106, and our clinical trial began enrollment in 2022 for treatment of patients with non-Hodgkin lymphoma (“NHL”) and chronic lymphocytic leukemia (“CLL”).

We plan to file an IND for a multicenter Phase 1/2 trial for MB-104 for the treatment of patients with multiple myeloma once COH has established a safe and effective dose.

We are also developing CAR T therapies for solid tumors in partnership with COH targeting IL13Rα2 (MB-101), HER2 (MB-103) and PSCA (MB-105).

In addition, we have partnered with Nationwide for the C134 oncolytic virus (MB-108) in order to enhance the activity of MB-101 for the treatment of patients with glioblastoma multiforme (“GBM”).

In addition, we have partnered with Nationwide for the C134 oncolytic virus (MB-108) in order to enhance the activity of MB-101 for the treatment of patients with glioblastoma (“GBM”).

Phase 1 clinical trials sponsored by COH for MB-101, MB-103 and MB-105 are underway.

A Phase 1 clinical trial sponsored by the University of Alabama at Birmingham (“UAB”) for MB-108 began during the third quarter of 2019 and, in the second half of 2022, we plan to file an IND for the combination of MB-101 and MB-108 – which is referred to as MB-109 – for the treatment of patients with relapsed or refractory GBM and anaplastic astrocytoma,.

In the third quarter of 2019, we announced that COH had started enrolling patients on a Phase 1 clinical trial of MB-101 in combination with nivolumab (commercial name:

Opdivo ® ) and ipilimumab (commercial name:

A Phase 1 clinical trial sponsored by the University of Alabama at Birmingham (“UAB”) for MB-108 began during the third quarter of 2019, and we plan to file an IND for the combination of MB-101 and MB-108 – which is referred to as MB-109 – for the treatment of patients with relapsed or refractory GBM and anaplastic astrocytoma in 2023.

In the third quarter of 2019, we announced that COH had started enrolling patients on a Phase 1 clinical trial of MB-101 in combination with nivolumab (trade name:

Opdivo ® ) and ipilimumab (trade name:

Yervoy ® ) in patients with recurrent malignant glioma (ClinicalTrials.gov Identifier:

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NCT04003649).

We also plan to file INDs and initiate our own clinical trials for MB-103 for the treatment of patients with metastatic breast cancer to brain and for MB-105 for the treatment of patients with prostate and pancreatic cancer.

Finally, the Company is collaborating with the Mayo Clinic to develop a novel technology that may be able to transform the administration of CAR T therapies and potentially be used as an off-the-shelf therapy.

Mustang plans to file an IND application for a multicenter Phase 1 clinical trial once a lead construct has been identified.

Gene Therapies

In partnership with St.

This first-in-class ex vivo lentiviral gene therapy has been evaluated in two Phase 1/2 clinical trials involving two different autologous cell products:

an ongoing multicenter trial of the MB-107 product in newly diagnosed infants sponsored by St.

Jude and a single-center trial of the MB-207 product in previously transplanted patients sponsored by the National Institutes of Health (“NIH”).

In 2022, the NIH study was suspended as a result of the study stopping rules.

In January 2021 we received a safe to proceed “approval” from the U.S.

Food and Drug Administration (“FDA”) for our MB-107 Investigational New Drug (“IND”) application allowing us to initiate a pivotal non-randomized multicenter Phase 2 clinical trial of MB-107 in newly diagnosed infants with XSCID who are under the age of two.

In January 2022, the FDA issued a clinical hold, pending additional Chemistry, Manufacturing and Controls (“CMC”) data, on our IND application to conduct a pivotal non-randomized multicenter Phase 2 clinical trial of MB-207 in previously transplanted XSCID patients.

To date, we have not received approval for the sale of our product candidates in any market and, therefore, have not generated any product sales from our product candidates.

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As of December 31, 2022, we have an accumulated deficit of $329.4 million.

We are a majority-controlled subsidiary of Fortress Biotech, Inc.

(“Fortress”).

We are a majority-controlled subsidiary of Fortress.

CORPORATE INFORMATION

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PRODUCTS UNDER DEVELOPMENT

Gene Therapies for Rare Genetic Disorders

MB-107 and MB-207 (Ex vivo Lentiviral Therapy for X-linked Severe Combined Immunodeficiency (XSCID))

XSCID is a rare genetic immune system condition also known as bubble boy disease, in which affected patients do not live beyond infancy without treatment.

Mustang Bio’s first-in-class ex vivo lentiviral gene therapy for XSCID is currently being administered as two distinct cellular products using the same lentiviral vector in two phase 1/2 clinical trials:

(1) a multicenter trial of MB-107 in newly diagnosed patients being led by St.

Jude and including also UCSF Benioff Children’s Hospital San Francisco (“UCSF”) and Seattle Children’s Hospital (“Seattle Children’s”) (ClinicalTrials.gov Identifier:

NCT01512888) and (2) a single center trial of MB-207 at the NIH in patients who have previously undergone hematopoietic stem cell transplantation (ClinicalTrials.gov Identifier:

NCT01306019).

The most recent peer-reviewed presentations by the respective investigators for these two trials occurred at the 61st Annual Meeting of the American Society of Hematology (“ASH”) in December 2019, at which time 24 patients had been treated in total.

Eleven patients under the age of two years had been treated at St.

Jude and UCSF and thirteen patients 3 to 34 years of age had been treated at the NIH .

The existing data from these 24 patients were encouraging.

In the initial stage of accrual to the Phase 1/2 NIH trial, eight patients (referred to as Cohort A) were followed for 3 to 7 years.

Among Cohort A, seven patients aged 3 to 23 years increased host T cells chimerism from 0-2% to 28-93% and had normal T cell proliferation response.

These seven patients also normalized their IgM levels, and four of these patients were able to discontinue immunoglobulin replacement therapy.

In addition, gradual clinical benefit was observed in the clearance of chronic norovirus and associated abdominal complaints, malabsorption, and growth retardation, with six of seven affected patients being cured of their disease.

Five of six patients resolved their protein-losing enteropathy.

While the Cohort A results were impressive, the relatively inefficient transduction of hematopoietic stem/progenitor cells (“HSPCs”) required large quantities of vector.

This resulted in relatively low vector copy number in myeloid cells in some patients, with delayed immune cell recovery and persistent clinical disease, especially in the last patient treated (patient 8).

To address this, NIH developed a refined enhanced transduction (“ET”) procedure and incorporated two transduction enhancers:

LentiBOOST™ 1mg/mL and dimethyl prostaglandin 2 (dmPGE2;

In addition to the Cohort A results, the NIH presentation at the 2019 ASH Annual Meeting included data from six ET patients (referred to as Cohort B) treated from February to June 2019, including re-treatment of patient 8.

Prior to undergoing gene therapy, the patients, who were aged 12 to 36 years, had significant problems with donor T cell infiltration of liver, bone marrow and kidneys and had nearly absent B and NK cells.

The ET procedure achieved much greater transduction efficiencies than were observed in Cohort A, with greater than 10-fold less vector, and resulted in faster immune reconstitution and more significant clinical benefit by 3 months.

As noted by the investigators, longer follow-up will be required to know if the increased vector marking using the ET regimen will prove to be stable and safe long term.

In all NIH patients, the low-dose, nonmyeloablative busulfan pretreatment conditioning was well tolerated, and of a low enough intensity to avoid the need for transfusions of red blood cells or platelets.

No evidence of malignant transformation was observed.

Subsequent to the initiation of the NIH trial, eleven patients under two years old who had not previously undergone hematopoietic stem cell transplantation (“HSCT”) were treated with the ex-vivo gene therapy in a St.

Jude/UCSF/Seattle Children’s Phase 1/2 trial, resulting in highly encouraging results.

Low-dose busulfan conditioning caused non-hematologic adverse events in only two patients (mild mucositis;

mucositis, hair loss), and no patients required blood product support.

All 11 patients had robust hematopoietic recovery within 3-4 weeks post cell infusion, and the nine patients who had a follow-up of greater than 3 months achieved normal-for-age T-cell and natural killer (“NK”)-cell numbers within 3-4 months post gene therapy.

Five patients were reported to have successfully discontinued intravenous immunoglobulin (“IVIG”) therapy, of whom 3 responded to vaccines.

Median vector copy number (“VCN”) at 12 months post-gene therapy in the seven patients who had a follow-up of greater than 12 months was 2.25 VCN/cell (range:

1.24-3.03) in T cells, 0.34 VCN/cell (range:

0.23-1.25) in B cells, 1.55 VCN/cell (range 1.27-3.39) in NK cells, and 0.08 VCN/cell (range:

0.03-0.76) in myeloid cells in peripheral blood, and 0.10 (range:

0.05-0.66) in CD34+ bone marrow cells, respectively.

With a median follow-up of 23.6 months, no evidence of malignant transformation was observed.

In a press release dated February 2, 2021, Mustang Bio provided a high-level update to the two ongoing phase 1/2 trials.

That press release disclosed that all 11 patients enrolled on the St.

Jude/USCF/Seattle Children’s trial continued to do well, and 5 additional patients had been enrolled at the time of the most recent analysis in early September 2020.

At that time, follow-up for these 16 patients ranged from 3 months to 47 months.

Similar to previous reports, the therapy continued to be well tolerated in all patients, and stable vector marking was noted in

all lineages, with successful engraftment of genetically-modified T-, B-, & NK-cells.

All patients cleared pre-existing infections, no new severe infections were noted, and all patients were outpatients.

Finally, there was no evidence of malignant transformation at a median follow up of 2 years.

The February 2, 2021, press release further disclosed that, of the 6 Cohort A patients who were alive at the time of the 2019 NIH data readout and who did not undergo repeat therapy, 3 patients were able to discontinue chronic intravenous immunoglobulin (IVIG) and experienced sustained restoration of humoral responses to immunization.

The remaining 3 patients had reduced IVIG requirements.

All chronic norovirus infections were resolved, and the quality of life of all patients had improved significantly.

The original 6 patients in Cohort B also continued to do well, with the longest follow-up being 22 months.

Two additional patients were successfully treated with transduction enhancers, for a total of 8 patients in Cohort B.

As was the case in Cohort A, no serious adverse events related to treatment were reported other than hematologic related to low-dose busulfan conditioning, and there was no evidence of malignant transformation.

MB-110 (Ex vivo Lentiviral Therapy for RAG1 Severe Combined Immunodeficiency (SCID))

In partnership with LUMC, our RAG1-SCID gene therapy program (MB-110) is being conducted under an exclusive license to develop a first-in-class ex vivo treatment for a rare genetic immune system condition.

Severe combined immunodeficiency due to complete recombinase-activating gene-1 (RAG1) deficiency is a rare, genetic severe combined immunodeficiency disorder due to null mutations in the RAG1 gene resulting in less than 1% of wild type V(D)J recombination activity.

Patients present with neonatal onset of life-threatening, severe, recurrent infections by opportunistic fungal, viral and bacterial micro-organisms, as well as skin rashes, chronic diarrhea, failure to thrive and fever.

Immunologic observations include profound T- and B-cell lymphopenia, low or absent serum immunoglobulins, and normal natural killer cell counts.

As is the case with other types of SCID, RAG1-SCID is fatal in infancy unless immune reconstitution is achieved with hematopoietic stem cell transplantation (HSCT).

MB-110, which includes low-dose conditioning prior to reinfusion of the patients’ own gene-modified blood stem cells, is currently being evaluated in a Phase 1/2 multicenter clinical trial in Europe.

The ongoing clinical trial has enrolled its first patient, and additional clinical sites are expected to be added in the near future.

The RAG1-SCID program has been granted Orphan Drug Designation by the European Medicines Agency.

Mustang also established an ongoing partnership with Frank J.

Staal, Ph.D., professor of Molecular Stem Cell Biology and molecular immunologist at LUMC, whose laboratory developed the therapy.

Staal will continue the development of additional lentiviral gene therapies in his lab, to which Mustang Bio has rights under the agreement.

CAR T Therapies for Hematologic Malignancies

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Of these malignancies, we are currently investigating CD123 as a target for adoptive cellular immunotherapy in BPDCN, since high CD123 expression is associated with enhanced cell proliferation, increased resistance of these cells to apoptosis, and poor clinical prognosis.

Depending on the early results in this patient population, we may broaden the inclusion criteria to include AML and high-risk MDS (“hrMDS”).

CD123 is overexpressed in the vast majority of cases of AML and hrMDS and in essentially all cases of BPDCN.

Acute myeloid leukemia is a cancer of the myeloid line of blood cells characterized by rapid growth of abnormal white blood cells that accumulate in the bone marrow.

Depending on the early results in this patient population, we may broaden the inclusion criteria to include AML and high-risk MDS (“HR-MDS”).

CD123 is overexpressed in the vast majority of cases of AML and HR-MDS and in essentially all cases of BPDCN.

AML is a cancer of the myeloid line of blood cells characterized by rapid growth of abnormal white blood cells that accumulate in the bone marrow.

AML is the most common form of acute leukemia.

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The Surveillance, Epidemiology, and End Results (“SEER”) Program of the National Cancer Institute].

AML standard of care involves chemotherapy to induce remission followed by additional chemotherapy or hematopoietic stem cell transplant.

Allogeneic stem cell transplantation is the preferred treatment for AML following a second remission.

AML standard of care involves chemotherapy to induce remission followed by additional chemotherapy or a hematopoietic stem cell transplant.

Allogeneic stem cell transplantation (“allo-SCT”) is the preferred treatment for AML following a second remission.

It can lead to a 5-year disease-free survival in 26% of patients.

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MDS and AML lie along a disease continuum, with distinction between the two largely made based upon the percentage of myeloblasts, which are immature cells with large nuclei, nucleoli, and a scant rim of dark blue cytoplasm, suggesting an underlying malignant hematologic disorder.

In the current World Health Organization (“WHO”) classification system, blast forms must account for less than 20% of the total cells of the bone marrow aspirate and peripheral blood in order to meet the criteria for MDS.

MDS prognosis is often assessed using the revised International Prognostic Scoring System (“IPSS-R”), which takes into account cytogenetics, percentage of bone marrow blasts, and the degree of anemia, thrombocytopenia, and neutropenia.

This System categorizes patients into very low, low, intermediate, high, and very high risk MDS.

High risk and very high risk MDS are generally progressive in nature and can easily progress to AML.

High risk and very high risk MDS are characterized by more

unfavorable cytogenetics, bone marrow blast percentages greater than 5% but under the 20% threshold for AML, and worse cytopenias (anemia, thrombocytopenia, and neutropenia) – all of which cumulatively generate an IPSS-R score of >4.5 to 6 for high risk MDS and >6 for very high risk MDS.

Furthermore, they are generally progressive in nature and can easily progress to AML.

Treatment is stratified according to medical fitness in a manner similar to that for older patients with AML.

Patients who are medically fit or of intermediate fitness are generally evaluated soon after diagnosis to determine their suitability for allogeneic hematopoietic cell transplantation.

Patients who are medically fit or of intermediate fitness are generally evaluated soon after diagnosis to determine their suitability for allo-SCT.

For patients who are not candidates for intensive treatment, care is focused on relieving symptoms and improving the quality of life and might involve lower intensity treatment, for example, with azacitidine, decitabine, or targeted therapy.

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After a relapse, second remissions with conventional chemotherapy are difficult to achieve.

Allogeneic hematopoietic stem cell transplant (“allo-SCT”), especially if offered in first remission, may result in longer remissions.

allo-SCT, especially if offered in first remission, may result in longer remissions.

The current recommendation is for BPDCN patients to be evaluated for an allo-SCT as soon as possible and to begin searching for a donor.

The use of CAR T immunotherapy in relapsed BPDCN, AML, and hrMDS patients may offer the potential to achieve a complete or longer lasting remission.

We have developed CD123-targeted CAR T cells designed to be activated, to proliferate, and to kill CD123-expressing tumor cells [Mardiros A et al .

The use of CAR T immunotherapy in relapsed BPDCN, AML, and HR-MDS patients may offer the potential to achieve a complete or longer lasting remission.

COH investigators have developed CD123-targeted CAR T cells designed to be activated, to proliferate, and to kill CD123-expressing tumor cells [Mardiros A et al .

2013;122(18):3138-3148].

The therapy is designed to recognize and eliminate malignant cells, leading to remission in patients with relapsed or refractory BPDCN, AML, and hrMDS, and could serve as a bridge to potentially curative allogeneic stem cell transplant.

The therapy is designed to recognize and eliminate malignant cells, leading to remission in patients with relapsed or refractory BPDCN, AML, and HR-MDS, and could serve as a bridge to potentially curative allogeneic stem cell transplant.

The manufacturing process genetically modifies T cells isolated from peripheral blood mononuclear cells in order to express a CD123-specific, hinge-optimized, CD28 co-stimulatory domain-expressing CAR.

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This is also the first clinical trial under a Mustang IND in which a patient was dosed with cells processed in our manufacturing facility.

In December 2022, we announced that the safety review team (“SRT”), after thoroughly reviewing the safety data from Dose Level 1 (100 x 10 6 CAR T cells), unanimously recommended dose escalation to Dose Level 2 (300 x 10 6 CAR T cells).

We anticipate initiation of Dose Level 2 cohort in 2023.

MB-104 (CS1 CAR T for Multiple Myeloma and Light Chain Amyloidosis)

CS1 (also known as CD319, CRACC and SLAMF7) was identified as an NK cell receptor regulating immune functions.

CS1 (also known as CD319, CRACC and SLAMF7) was identified as a natural killer (“NK”) cell receptor regulating immune functions.

It is also expressed on B cells, T cells, dendritic cells, NK-T cells, and monocytes.

CS1 is overexpressed in multiple myeloma (“MM”) and light chain amyloidosis (“AL”), which makes it a good target for immunotherapy.

A humanized anti-CS1 antibody, elotuzumab (Empliciti™), has

shown promising results in clinical studies and was initially approved by the FDA in 2015 in combination with lenalidomide and dexamethasone for the treatment of patients with multiple myeloma who have received one to three prior therapies .

A humanized anti-CS1 antibody, elotuzumab (Empliciti™), has shown promising results in clinical studies and was initially approved by the FDA in 2015 in combination with lenalidomide and dexamethasone for the treatment of patients with multiple myeloma who have received one to three prior therapies .

Despite great advances in treatment, MM remains an incurable malignancy of plasma cells.

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CD20 is a B-cell lineage-specific phosphoprotein that is expressed in high, homogeneous density on the surface of more than 95% of B-cell NHL and CLL.

CD20 is stable on the cell surface with minimal shedding or internalization upon binding antibody and is present at only nanomolar levels as soluble antigen.

CD20 is stable on the cell surface with minimal shedding, internalization, or modulation upon antibody binding and is present at only nanomolar levels as a soluble antigen.

It is well established as an effective immunotherapy target, with extensive studies demonstrating improved tumor responses and survival of B-NHL patients treated with rituximab and other anti-CD20 antibodies.

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Thus, there is strong rationale for testing CD20 CAR T cells as an immunotherapy for NHL.

More than 70,000 new cases of NHL are diagnosed each year in the United States, and more than 19,000 patients die of this group of diseases annually.

Most forms of NHL including follicular lymphoma, mantle cell lymphoma, marginal zone lymphoma, lymphoplasmacytic lymphoma, and small lymphocytic lymphoma, which account collectively for ~45% of all cases of NHL, are incurable with available therapies, except for allogenic hematopoietic stem cell transplant (“allo-SCT”).

More than 80,000 new cases of NHL are diagnosed each year in the United States, and over 20,000 patients die of this group of diseases annually.

Most forms of NHL including follicular lymphoma, mantle cell lymphoma, marginal zone lymphoma, lymphoplasmacytic lymphoma, and small lymphocytic lymphoma (“SLL”), which account collectively for ~45% of all cases of NHL, are incurable with available therapies, except for allo-SCT.

However, many NHL patients are not suitable candidates for allo-SCT, and this treatment is also limited by significant rates of morbidity and mortality due to graft-versus-host disease.

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Chronic lymphocytic leukemia/small lymphocytic lymphoma (CLL/SLL) is a mature B cell neoplasm characterized by a progressive accumulation of monoclonal B lymphocytes.

CLL is considered to be identical (i.e., one disease with different manifestations) to the non-Hodgkin lymphoma SLL.

CLL is considered to be identical (i.e., one disease with different manifestations) to the NHL SLL.

The malignant cells seen in CLL and SLL have identical pathologic and immunophenotypic features.

The term CLL is used when the disease manifests primarily in the blood, whereas the term SLL is used when involvement is primarily nodal.

CLL/SLL is the most common leukemia in adults in Western countries, accounting for approximately 25 to 35 percent of all leukemias in the United States.

It is estimated that 21,250 new cases of CLL/SLL will be diagnosed in the United States in 2021.

CLL/SLL is considered to be mainly a disease of older adults, with a median age at diagnosis of approximately 70 years;

CLL is the most common leukemia in adults in Western countries, accounting for approximately 25 to 35 percent of all leukemias in the United States.

It is estimated that 18,740 new cases of CLL will be diagnosed in the United States in 2023.

CLL is considered to be mainly a disease of older adults, with a median age at diagnosis of approximately 70 years;

however, it is not unusual to make this diagnosis in younger individuals (e.g., from 30 to 39 years of age).

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In addition, many patients will require a change in therapy due to intolerance.

Patients with CLL are generally elderly with a median age older than 70 years, and due to the relatively benign course of the disease in the majority of patients, only selected patients are candidates for intensive treatments such as HCT.

Since patients with CLL are generally elderly with a median age older than 70 years, and due to the relatively benign course of the disease in the majority of patients, only selected patients are candidates for intensive treatments such as allo-SCT.

Innovative new treatments with a favorable safety profile are therefore urgently needed for patients with relapsed and refractory disease.

Fred Hutch has an open IND for a Phase 1/2 clinical study to evaluate the anti-tumor activity and safety of administering CD20-directed third-generation CAR T cells incorporating both 4-1BB and CD28 co-stimulatory signaling domains (MB-106) to patients with relapsed or refractory B-cell NHL or CLL (ClinicalTrials.gov Identifier:

Under their IND, Fred Hutch is currently conducting a Phase 1/2 clinical study to evaluate the anti-tumor activity and safety of administering CD20-directed third-generation CAR T cells incorporating both 4-1BB and CD28 co-stimulatory signaling domains (MB-106) to patients with relapsed or refractory B-cell NHL or CLL (ClinicalTrials.gov Identifier:

NCT03277729).

Secondary endpoints include safety and toxicity, preliminary antitumor activity as measured by overall response rate and complete remission rate, progression-free survival, and overall survival.

The trial will also assess CAR T cell persistence and determine the potential immunogenicity of the cells, and Mustang together with Fred Hutch will determine a recommended Phase 2 dose.

Fred Hutch intends to enroll approximately 30 subjects on the trial, which is being led by principal investigator Mazyar Shadman, M.D., M.P.H., Assistant Member of Fred Hutch’s Clinical Research Division.

This IND was submitted on February 24, 2017, with Fred Hutch as the sponsor.

The IND was amended in 2019 to incorporate an optimized manufacturing process that had been developed in collaboration with Mustang.

Due to the expected increased potency of the CAR-T cells, the dose in the first cohort treated with this optimized manufacturing process was reduced back to the cohort 1 dose of 3.3 x 10 5 CAR T cells/kg.

The first patient treated in this cohort had follicular lymphoma that had relapsed after initial therapy, maintenance therapy, and two salvage regimens.

She achieved a complete response (“CR”) on Day 28, and no cytokine release syndrome (“CRS”) or neurologic toxicity was observed.

While this initial success using the optimized MB-106 process is important, additional clinical testing is necessary, and accrual to the trial continues.

In December 2020, at the 62 nd American Society of Hematology Annual Meeting, Mustang and Fred Hutch announced interim data in patients with relapsed or refractory B-cell NHL from the ongoing Phase 1/2 clinical trial of MB-106 at Fred Hutch.

Data presented by Fred Hutch reported on an initial seven patients treated without response and without significant CAR T cell expansion or persistence.

Among these 7 patients there was one occurrence of CRS (CRS;

grade 3 – unexplained alkaline phosphatase elevation in the setting of fever), and there were no occurrences of immune effector cell-associated neurotoxicity syndrome (“ICANS”).

Subsequently the trial was put on hold while Fred Hutch collaborated with Mustang to undertake a major modification in the cell manufacturing process.

Following IND amendment to implement this modified cell processing, 9 patients – 7 with follicular lymphoma and 2 with mantle cell lymphoma – were treated at 4 different dose levels ranging from 1 x 10 5 CAR T cells/kg to 3.3 x 10 6 CAR T cells/kg.

The overall response rate was 89% (8/9), the complete response rate was 44% (4/9), and there was good expansion and persistence of CAR T cells.

All complete responses were ongoing at the time of data disclosure.

One patient experienced a grade 1 episode of CRS, and no patients experienced ICANS.

Mustang plans to file an IND at the end of the first quarter of 2021 to enable the initiation of a multicenter Phase 1/2 trial of MB-106.

In December 2021, we announced MB-106 data presented at ASH2021.

Mazyar Shadman of Fred Hutch updated interim data showing a 95% overall response rate, 65% complete response rate and favorable safety profile from the ongoing Phase 1/2 clinical trial for NHL and CLL.

No patient experienced CRS or ICANS ≥ grade 3.

Secondary endpoints of this study include safety and toxicity, preliminary antitumor activity as measured by overall response rate and complete remission rate, progression-free survival, and overall survival.

The study is also assessing CAR T cell persistence and the potential immunogenicity of the cells.

Finally, the study was designed so that Mustang together with Fred Hutch could determine a recommended Phase 2 dose.

Fred Hutch intends to enroll approximately 50 subjects in the study, which is being led by Principal Investigator Mazyar Shadman, M.D., M.P.H., Assistant Member of Fred Hutch’s Clinical Research Division.

The Fred Hutch IND was amended in 2019 to incorporate an optimized manufacturing process that had been developed in collaboration with Mustang.

In May 2021, we announced that the FDA had approved our IND application allowing for initiation of a multi-center Phase 1/2 clinical study of MB-106 in patients with relapsed or refractory B cell NHL or CLL (Clinicaltrials.gov Identifier:

NCT05360238).

In November 2021, Mustang was awarded a grant of approximately $2 million from NCI of the National Institutes of Health.

This two-year award will partially fund the Mustang-sponsored multicenter trial to assess the safety, tolerability and efficacy of MB-106.

CAR T Therapies for Solid Tumors

MB-103 (HER2 CAR T for GBM & Metastatic Breast Cancer to Brain)

HER2/neu (“HER2”) is a growth-promoting protein on the outside of all breast cells.

Breast cancer cells with higher-than-normal levels of HER2 are called HER2-positive (“HER2+”).

These cancers tend to grow and spread faster than other breast cancers.

Breast cancer is the most commonly diagnosed cancer in women, with over 42,000 women in the United States expected to die from advanced metastatic disease in 2023.

Approximately 20% to 25% of breast cancers overexpress HER2, which is an established therapeutic target of both monoclonal antibodies (mAbs) and receptor tyrosine kinase inhibitors.

With the advent of effective mAbs directed against HER2, the median overall survival of patients with metastatic HER2+ breast cancer has improved.

However, management of metastatic disease in the brain and/or CNS – observed in up to 50% of HER2+ breast cancer patients – continues to be a clinical challenge in large part due to the inability of mAbs to sufficiently cross the blood-brain barrier.

Although small-molecule inhibitors of HER2 exist and have been clinically approved, their single-agent efficacy in the context of metastatic disease to the brain has been limited.

While HER2-targeted therapy in combination with conventional agents has shown some promise for the treatment of patients with metastatic breast cancer, control of brain metastases remains a significant unmet clinical need, as most patients survive less than two years following CNS involvement.

Recent advances in cellular immunotherapy approaches have underscored the potential for potent antitumor immune responses and clinical benefit against solid cancers, and these approaches may be effective in the treatment of HER2+ cancers – in particular breast cancer – that have metastasized to the brain.

Likewise, HER2 has been suggested as a suitable target for GBM, wherein elevated HER2 protein levels have been correlated with impaired survival.

CAR T cell immunotherapy is being actively investigated for the treatment of solid tumors, including HER2+ cancers.

Our academic partners at COH have developed a second-generation HER2-specific CAR T cell therapy for the treatment of brain and/or leptomeningeal metastases from HER2+ cancers, as well as for the treatment of refractory/relapsed HER2+ GBM.

COH’s preclinical data demonstrate effective targeting of breast cancer brain metastases with intraventricular delivery of CAR T cells expressing HER2-CARs that contain the 4-1BB costimulatory domain.

COH is evaluating the safety of this HER2-specific CAR T cell therapy in two ongoing Phase 1 clinical trials that commenced in the fourth quarter of 2018 (ClinicalTrials.gov Identifier:

NCT03389230 for HER2+ GBM;

ClinicalTrials.gov Identifier:

NCT03696030 for HER2+ brain metastases).

MB-105 (PSCA CAR T for Prostate & Pancreatic Cancers)

PSCA is a glycosylphosphatidylinositol-anchored cell membrane glycoprotein.

In addition to being highly expressed in the prostate it is also expressed in the bladder, placenta, colon, kidney, and stomach.

This gene is upregulated in a large proportion of prostate cancers and is also detected in cancers of the bladder and pancreas.

The gene includes a polymorphism that results in an upstream start codon in some individuals;

this polymorphism is thought to be associated with a risk for certain gastric and bladder cancers.

Prostate cancer may be amenable to T cell-based immunotherapy since several tumor antigens, including prostate stem-cell antigen (“PSCA”), are widely overexpressed in metastatic disease.

Our academic partners at COH have developed a second-generation PSCA-specific CAR T cell therapy that has demonstrated robust in vitro and in vivo anti-tumor activity in patient-derived, clinically relevant, bone-metastatic prostate cancer xenograft models.

COH is evaluating the safety of this PSCA-specific CAR T cell therapy in an ongoing Phase 1 trial treating patients with PSCA+ metastatic castration-resistant prostate cancer (ClinicalTrials.gov Identifier:

NCT03873805).

In October 2020,we announced initial data from this Phase 1 clinical trial in patients with PSCA-positive castration-resistance prostate cancer (“CRPC”).

In the presentation at the 2020 Annual Prostate Cancer Foundation Scientific Retreat, the COH principal investigator reported results from a highly refractory patient treated with MB-105 who experienced a 94 percent reduction in prostate-specific antigen (“PSA”), a nearly complete reduction of measurable soft tissue metastasis by computerized tomography, and improvement in bone metastases by magnetic resonance imaging.

Combination MB-101 (IL13Rα2 CAR T Cell Program for Glioblastoma) and MB-108 (HSV-1 oncolytic virus C134) as a Potential Treatment for IL13Rα2+ Relapsed or Refractory Glioblastoma (GBM) and Anaplastic Astrocytoma (AA).

An attractive novel approach to control glioblastoma is adoptive cellular immunotherapy utilizing CAR T cells.

CAR T cells can be engineered to recognize very specific antigenically distinct tumor populations and to migrate through the brain parenchyma to kill malignant cells.

In addition, oncolytic viruses (“OVs”) have been developed to effectively infect and kill cancer cells in the tumor, as well as modify the microenvironment to increase tumor immunogenicity and immune cell trafficking within the tumor.

Due to these properties, OVs have been studied in combination with other treatments to enhance the effectiveness of immunotherapies.

Preliminary anti-tumor activity has been observed in clinical studies administering the OV (MB-108) and CAR T cell therapy (MB-101) as single agents;

however, the combination has not yet been explored.

To determine if the combination of both therapies will result in a synergistic effect, investigators from COH developed preclinical studies in orthotopic GBM models in nude mice.

Christine Brown from City of Hope presented these preclinical studies at the American Association for Cancer Research 2022 annual meeting.

It was observed that co-treatment with C134 OV and IL13Rα2-directed CAR-T cells gave no adverse reaction and, more notably, that pre-treatment with C134 re-shaped the tumor microenvironment by increasing immune cell infiltrates and enhanced the efficacy of sub-therapeutic doses of CAR-T cell therapy delivered either intraventricularly or intratumorally.

These preclinical studies aimed to provide a deeper understanding of this combination approach to support the potential benefit of a combination study that will evaluate C134 OV (MB-108) and IL13Rα2-directed CAR-T cells (MB-101).

We received Pre-IND Written Responses from the FDA in May 2022, and we expect to file an IND for the combination trial of C134 oncolytic virus (MB-108) and IL13Rα2-directed CAR- T cells (MB-101) in 2023.

In the planned Phase 1 clinical study, we intend to evaluate the combination of CAR-T cells (MB-101) and the C134 oncolytic virus (MB-108) in patients with IL13Rα2+ high-grade gliomas.

The proposed design of this study will investigate increasing doses of intratumorally administered MB-108 followed by dual intratumoral (ICT) and intraventricular (ICV) administration of MB-101.

MB-101 (IL13Rα2 CAR T Cell Program for Glioblastoma)

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More than 13,000 new glioblastoma cases were predicted in the U.S.

Malignant brain tumors are the most common cause of cancer-related deaths in adolescents and young adults aged 15-39 and the most common cancer occurring among 15-19 year-olds in the U.S.

Malignant brain tumors are the second leading cause of cancer-related deaths in adolescents and young adults aged 15-39 and the most common cancer occurring among 15-19-year-olds in the U.S.

While GBM is a rare disease [2-3 cases per 100,000 persons per year in the U.S.

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We are developing an optimized CAR-T product incorporating enhancements in CAR-T design and T cell engineering to improve antitumor potency and T cell persistence.

We include a second-generation hinge-optimized CAR containing mutations in the IgG4 linker to reduce off-target Fc interactions (Jonnalagadda M et al.

These include a second-generation hinge-optimized CAR containing mutations in the IgG4 linker to reduce off-target Fc interactions (Jonnalagadda M et al.

Molecular Therapy.

2015;23(4):757-768.).

We also include the 4-1BB (CD137) co-stimulatory signaling domain for improved survival and maintenance of CAR T cells.

Finally, we incorporate the extracellular domain of CD19 as a selection/tracking marker.

In order to further improve persistence, either central memory T-cells (T CM ;

Arms 1 – 4) or enriched CD62L+ naïve and memory T cells (T N/MEM ;

Arm 5) are isolated and enriched.

The manufacturing process limits ex vivo expansion, which is designed to reduce T cell exhaustion and maintain a T CM or T N/MEM phenotype.

These CAR modified T CM and T N/MEM cells are shown to be more potent and persistent than earlier generations of CAR T cells, based on experiments with CAR Ts in mouse xenograft models of GBM.

Our academic partners at COH have an open IND to assess the feasibility and safety of using T CM or T N/MEM enriched IL13Rα2-specific CAR engineered T cells for clinical study participants with recurrent/refractory malignant glioma (ClinicalTrials.gov Identifier:

2015;23(4):757-768.), a 4-1BB (CD137) co-stimulatory signaling domain for improved survival and maintenance of CAR T cells, and the extracellular domain of CD19 as a selection/tracking marker.

In order to further improve persistence, either central memory T-cells (T CM ) or enriched CD62L+ naïve and memory T cells (T N/MEM ) are isolated and enriched.

Our manufacturing process limits ex vivo expansion, which is designed to reduce T cell exhaustion and maintain a T CM or T N/MEM phenotype.

Based on experiments with CAR-Ts in mouse xenograft models of GBM, these CAR-modified T CM and T N/MEM cells have been shown to be more potent and persistent than earlier generations of CAR-T cells.

Our academic partners at COH have completed a Phase 1 study to assess the feasibility and safety of using T CM or T N/MEM enriched IL13Rα2-specific CAR-engineered T cells for clinical study participants with recurrent/refractory malignant glioma (ClinicalTrials.gov Identifier:

NCT02208362).

This IND was submitted in October 2014, with COH as the sponsor.

COH has enrolled and treated 65 patients as of

December 31, 2021.

In the annual meeting of the American Association for Cancer Research in April 2018, our collaborators at COH presented the preliminary data for patients enrolled on Arm 2 of the protocol (the “Intracavitary Arm”).

The investigators reported that the CAR T cells were well-tolerated, meaning that no dose-limiting toxicities had been seen to date.

In 2016 the investigators reported on a patient that they determined had a complete response to treatment based on the imaging and clinical features set forth by the Response Assessment in Neuro-Oncology Criteria (“RANO”).

As of May 2022 COH had enrolled and treated 65 patients.

Preliminary data for patients enrolled in Arm 2 of the protocol (the “Intracavitary Arm”) were presented at the annual meeting of the American Association for Cancer Research in April 2018.

The data indicated that the CAR-T cells were well tolerated, and no dose-limiting toxicities had been observed.

In 2016 COH reported that a patient had achieved a complete response to treatment based on the imaging and clinical features set forth by the Response Assessment in Neuro-Oncology Criteria (“RANO”).

This result was published as a case report in the New England Journal of Medicine (Brown CE et al.

2016;375:2561-9).

As described in the paper, a patient with recurrent multifocal glioblastoma received multiple infusions of IL13Rα2-specific CAR T cells over 220 days through two intracranial delivery routes – infusions into the resected tumor cavity followed by infusions into the ventricular system.

As described in the paper, this patient diagnosed with recurrent multifocal glioblastoma received multiple infusions of IL13Rα2-specific CAR-T cells over 220 days through two intracranial delivery routes – infusions into the resected tumor cavity followed by infusions into the ventricular system.

Intracranial infusions of IL13Rα2-targeted CAR-T cells were not associated with any toxic effects of grade 3 or higher.

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however, the patient’s disease eventually recurred at four new locations that were distinct and non-adjacent to the original tumors, and biopsy of one of these lesions showed decreased expression of IL13Rα2.

With enrollment in this Phase 1 study nearly complete, COH has established the recommended Phase 2 dose, schedule and route of administration, as well as optimal T cell selection.

Results from this study have laid the foundation for 3 new MB-101 studies:

enrollment in this Phase 1 study completed, COH has established the recommended Phase 2 dose, schedule and route of administration, as well as the optimal T cell selection.

Results from this COH study have laid the foundation for 3 new MB-101 studies:

MB-101 with or without nivolumab and ipilimumab in treating patients with recurrent or refractory glioblastoma (currently enrolling patients;

ClinicalTrials.gov Identifier:

NCT04003649);

NCT04003649) sponsored by COH;

MB-101 in treating patients with recurrent or refractory glioblastoma with a substantial component of leptomeningeal disease (currently enrolling patients;

ClinicalTrials.gov Identifier:

NCT04661384);

MB-101 in combination with the C134 oncolytic virus (MB-108) in treating patients with recurrent or refractory glioblastoma (IND filing expected in the second half of 2022).

This combination will be referred to as MB-109.

MB-103 (HER2 CAR T for GBM & Metastatic Breast Cancer to Brain)

HER2/neu (“HER2”) is a growth-promoting protein on the outside of all breast cells.

Breast cancer cells with higher than normal levels of HER2 are called HER2-positive (“HER2+”).

These cancers tend to grow and spread faster than other breast cancers.

Breast cancer is the most commonly diagnosed cancer in women, with over 42,000 women in the United States expected to die from advanced metastatic disease in 2020.

Approximately 20% to 25% of breast cancers overexpress HER2, which is an established therapeutic target of both monoclonal antibodies (mAbs) and receptor tyrosine kinase inhibitors.

With the advent of effective mAbs directed against HER2, the median overall survival of patients with metastatic HER2+ breast cancer has improved.

Although small-molecule inhibitors of HER2 exist and have been clinically approved, their single-agent efficacy in the context of metastatic disease to the brain has been limited.

Likewise, HER2 has been suggested as a suitable target for GBM, wherein elevated HER2 protein levels have been correlated with impaired survival.

CAR-based T-cell immunotherapy is being actively investigated for the treatment of solid tumors, including HER2+ cancers.

Our academic partners at COH have developed a second-generation HER2-specific CAR T-cell for the treatment of brain and/or leptomeningeal metastases from HER2+ cancers, as well as for the treatment of refractory/relapsed HER2+ GBM.

COH is evaluating the safety of this HER2-specific CAR T cell therapy in two Phase 1 clinical trials that commenced in the fourth quarter of 2018 (ClinicalTrials.gov Identifier:

NCT03389230 for HER2+ GBM;

ClinicalTrials.gov Identifier:

NCT03696030 for HER2+ brain metastases).

MB-105 (PSCA CAR T for Prostate & Pancreatic Cancers)

PSCA is a glycosylphosphatidylinositol-anchored cell membrane glycoprotein.

In addition to being highly expressed in the prostate it is also expressed in the bladder, placenta, colon, kidney, and stomach.

This gene is upregulated in a large proportion of prostate cancers and is also detected in cancers of the bladder and pancreas.

The gene includes a polymorphism that results in an upstream start codon in some individuals;

this polymorphism is thought to be associated with a risk for certain gastric and bladder cancers.

Prostate cancer may be

amenable to T cell-based immunotherapy since several tumor antigens, including prostate stem-cell antigen (“PSCA”), are widely overexpressed in metastatic disease.

COH is evaluating the safety of this PSCA-specific CAR T cell therapy in a Phase 1 trial treating patients with PSCA+ metastatic castration-resistant prostate cancer (ClinicalTrials.gov Identifier:

NCT03873805).

In October 2020,we announced initial data from the Phase 1 clinical trial in patients with PSCA-positive castration-resistance prostate cancer (“CRPC”).

In a presentation at the 2020 Annual Prostate Cancer Foundation Scientific Retreat, the COH principal investigator reported results from a highly refractory patient treated with MB-105 who experienced a 94 percent reduction in prostate-specific antigen (“PSA”), near complete reduction of measurable soft tissue metastasis by computerized tomography, and improvement in bone metastases by magnetic resonance imaging.

We believe additional data could potentially be provided in the second half of 2022.

NCT04661384) sponsored by COH;

MB101 in combination with the C134 oncolytic virus (MB108) in treating patients with recurrent or refractory glioblastoma or anaplastic astrocytoma (IND filing expected in 2023).

This combination therapy, to be administered in a phase 1 two-center trial under Mustang IND, will be referred to as MB-109.

Technology to Convert GBM from an Immunologically Cold Tumor to an Immunologically Hot Tumor

MB-108 (HSV-1 oncolytic virus C134)

C134 is a next-generation oncolytic herpes simplex virus (“oHSV”) that is conditionally replication competent;

MB-108 is a next-generation oncolytic herpes simplex virus (“oHSV”) that is conditionally replication competent;

that is, it can replicate in tumor cells, but not in normal cells, thus killing the tumor cells directly through this process.

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In addition to this direct oncolytic activity, the virus promotes an immune response against surviving tumor cells, which increases the antitumor effect of the therapy.

The virus expresses a gene from another virus from the same overall virus family, human cytomegalovirus, that allows it to replicate better in the tumor cells than its first-generation predecessors.

The virus expresses a gene from another virus from the same overall virus family, human cytomegalovirus, which allows it to replicate better in the tumor cells than its first-generation predecessors.

However, the virus has also been genetically engineered to minimize the production of any toxic effects for the patient receiving the therapy.

To improve this virus over its first-generation predecessors, modifications have focused on improving viral replication and spread within the tumor bed and on enhancing bystander damage to uninfected tumor cells.

These effects cumulatively should result in converting an immunologically cold tumor to an immunologically hot tumor, which Mustang anticipates will increase the efficacy of its IL13Rα2-directed CAR T for the treatment of GBM.

UAB is the clinical trial site for the Phase 1 trial of MB-108, and the site has initiated a Phase 1 trial that began enrolling patients in 2019 (ClinicalTrials.gov Identifier:

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Secondary objectives are to obtain preliminary information about the potential benefit of MB-108 in the treatment of patients with recurrent malignant gliomas, including relevant data on markers of efficacy, including time to tumor progression and patient survival.

In 2021, we intend to combine MB-108 with MB-101 to potentially enhance efficacy in treating GBM.

This trial has been on clinical hold since October 2020 due to toxicity at the highest dose level, and UAB expects FDA clearance in the first half of 2021 in order to resume enrolling patients at a lower dose level.

As a result of this clinical hold, as well as COVID-19 virus-related accrual delays in 2020, we expect that IND filing for the combination trial of MB-108 with MB-101 (MB-109) will be delayed until the fourth quarter of 2022.

This trial has been on clinical hold since September 2022 due to toxicity, and UAB expects FDA clearance in 2023 in order to resume enrolling patients at a lower dose level.

In Vivo CAR T Platform Technology

Mustang is collaborating with the Mayo Clinic to develop a novel technology that may be able to transform the administration of CAR T therapies and potentially be used as an off-the-shelf therapy.

The technology, developed by Larry R.

Pease, Ph.D., principal investigator and former director of the Center for Immunology and Immune Therapies at Mayo Clinic, is a new platform to administer CAR T therapy using a two-step approach.

First, a peptide is administered to the patient to drive the proliferation of the patient’s resident T cells.

This is followed by the administration of a viral CAR construct directly into the lymph nodes of the patient.

In turn, the viral construct infects the activated T cells and effectively forms CAR T cells in vivo in the patient.

Successful implementation may lead to an off-the-shelf product with no need to isolate and expand patient T cells ex vivo .

Preclinical proof-of-concept has been established, and the ongoing development of this technology will take place at Mayo Clinic.

Mustang plans to file an IND application for a multicenter Phase 1 clinical trial once a lead construct has been identified.

Gene Therapies for Rare Genetic Disorders

MB-107 and MB-207 (Ex vivo Lentiviral Therapy for X-linked Severe Combined Immunodeficiency (XSCID))

XSCID is a rare genetic immune system condition that occurs almost exclusively in males, in which affected patients do not live beyond infancy without treatment.

Mustang Bio’s first-in-class ex vivo lentiviral gene therapy for XSCID has been administered as two distinct cellular products using the same lentiviral vector in two phase 1/2 clinical trials:

(1) an ongoing multicenter trial of MB-107 in newly diagnosed patients being led by St.

Jude and including also UCSF Benioff Children’s Hospital San Francisco (“UCSF”) and Seattle Children’s Hospital (“Seattle Children’s”) (ClinicalTrials.gov Identifier:

NCT01512888) and (2) a single center trial of MB-207 at the NIH in patients who have previously undergone hematopoietic stem cell transplantation (ClinicalTrials.gov Identifier:

NCT01306019).

MB-207 (previously transplanted patients):

The last peer-reviewed presentation by the NIH Principal Investigator, Dr.

Harry Malech, occurred at the 61st Annual Meeting of the American Society of Hematology (“ASH”) in December 2019, at which time 24 patients had been treated in total.

Eleven patients under the age of two years had been treated at St.

Jude and UCSF and thirteen patients 3 to 34 years of age had been treated at the NIH .

The existing data from these 24 patients were encouraging.

In the initial stage of accrual to the Phase 1/2 NIH trial, eight patients (referred to as Cohort A) were followed for 3 to 7 years.

Among Cohort A, seven patients aged 3 to 23 years increased host T cells chimerism from 0-2% to 28-93% and had normal T cell proliferation response.

These seven patients also normalized their IgM levels, and four of these patients were able to discontinue immunoglobulin replacement therapy.

Five of six patients resolved their protein-losing enteropathy.

While the Cohort A results were impressive, the relatively inefficient transduction of hematopoietic stem/progenitor cells (“HSPCs”) required large quantities of vector.

To address this, NIH developed a refined enhanced transduction (“ET”) procedure and incorporated two transduction enhancers:

LentiBOOST™ 1mg/mL and dimethyl prostaglandin 2 (dmPGE2;

1µM) into the manufacturing process from MB-207.

As noted by the investigators, longer follow-up will be required to know if the increased vector marking using the ET regimen will prove to be stable and safe long term.

No evidence of malignant transformation was observed.

In a press release dated February 2, 2021, we further disclosed that, of the 6 Cohort A patients who were alive at the time of the 2019 NIH data readout and who did not undergo repeat therapy, 3 patients were able to discontinue chronic intravenous immunoglobulin (IVIG) and experienced sustained restoration of humoral responses to immunization.

The remaining 3 patients had reduced IVIG requirements.

All chronic norovirus infections were resolved, and the quality of life of all patients had improved significantly.

The original 6 patients in Cohort B also continued to do well, with the longest follow-up being 22 months.

Two additional patients were successfully treated with transduction enhancers, for a total of 8 patients in Cohort B.

As a result of the study stopping rules, the NIH study was suspended in 2022 due to the presence of clonal expansion in the myeloid lineage in 10% of the treated patients, although to date there have been no observations of insertional mutagenesis or malignancies.

All patients continue to be followed and remain clinically stable with no significant hematological anomalies.

Upon review of these data, the FDA agree that the risk-benefit ration of both MB-107 and MB-207 remains favorable to support moving forward with the Mustang-sponsored multicenter clinical trials once Mustang has appropriately addressed other items flagged by the Agency.

The IND for MB-207 was submitted to the FDA in December 2021.

In January 2022, the FDA issued a clinical hold, pending additional CMC data.

In order to lift this clinical hold and receive an FDA safe-to-procced for the IND, we believe the most critical activities will be

to (1) perform process validation manufacturing runs using healthy donor material and (2) ensure qualification of all assays related to the product release.

Following completion of these activities and the earliest release of the clinical hold by FDA, we expect to enroll the first patient in a pivotal multicenter Phase 2 clinical trial in 2023.

MB-207 received Orphan Drug Designation from the FDA in September 2020.

The FDA also granted Rare Pediatric Disease Designation for MB-207 in August 2020.

If Mustang’s BLA for MB-207 is approved, the Company may be eligible to receive a priority review voucher for this product as well, which can also be redeemed to obtain priority review for any subsequent marketing application and may be sold or transferred.

The European Medicines Agency (“EMA”) granted Advanced Therapy Medicinal Product (“ATMP”) classification to MB-207 in April 2020 and Orphan Drug designation in April 2021.

MB-107 (newly diagnosed patients):

Interim Phase 1/2 data on treatment of newly diagnosed infants under the age of two with the same LV vector used in MB-107 were updated at an oral presentation at the American Society of Gene & Cell Therapy (“ASGCT”) 25 th Annual Meeting held from May 16-19, 2022.

The data included 23 infants with XSCID treated with the LV vector at a median age of 3 months (range:

2 months to 14 months) with a median follow-up of 2.4 years (range:

1.4 months to 5.4 years), making it the largest known cohort of infants treated with LV gene therapy with the longest follow-up.

Transduced autologous bone marrow CD34+ cells were generated for all patients with a median vector copy number (VCN) of 0.81/cell (range:

0.16-1.81), and a median CD34+ cell dose of 9.61x10 6 /kg (range 4.40-18.95).

Prior to the infusion of cells, patients received busulfan targeted to a cumulative area-under-the-curve (cAUC) of 22 mg*hr/L.

Severe adverse events occurred in three patients (two patients with pancytopenia and hemolytic anemia, and one patient with delayed neutrophil engraftment), and all resolved.

Seventeen of 18 patients with a follow-up of > 6 months achieved robust immune reconstitution [median CD3+ 2,545/µL, CD4+ 1,568/µL, CD4+/CCR7+/CD45R0- 1,416/µL].

In these 17 patients, T cells matured appropriately as assessed by normal T cell receptor excision circles (TRECs) and TCRvβ repertoire diversity and were functional as judged by phytohemagglutinin activation (“PHA”).

All patients were alive with stable vector marking in all cell lineages.

In addition, 15 patients had discontinued intravenous immunoglobulin, and 12 patients had been successfully immunized.

No evidence of clonal expansion or malignant transformation was observed.

The MB-107 timeline has been extended due to unanticipated issues related to the materials used in manufacturing.

These issues were communicated to the FDA and the Company received a written response on August 26, 2022.

The FDA response provided additional direction enabling us to effectively continue to work with our outside suppliers.

We are working towards enrolling the first patient in a pivotal multicenter Phase 2 clinical trial under our IND in 2023.

MB-107 received Orphan Drug Designation in August 2020 and Rare Pediatric Disease and Regenerative Medicine Advanced Therapy (“RMAT”) designations in August 2019.

Finally, the FDA designated MB-107 a Rare Pediatric Disease in August 2020.

The FDA grants Rare Pediatric Disease Designation for serious and life-threatening diseases that primarily affect children ages 18 years or younger and affect fewer than 200,000 people in the United States.

If Mustang’s BLA for MB-107 is approved, the Company may be eligible to receive a priority review voucher, which can be redeemed to obtain priority review for any subsequent marketing application and may be sold or transferred.

This program is intended to encourage development of new drugs and biologics for the prevention and treatment of rare pediatric diseases.

The EMA, granted Priority Medicines (“PRIME”) designation to MB-107 in July 2021, and ATMP classification to MB-107 in April 2020 and Orphan Drug designation in November 2020.

MB-110 (Ex vivo Lentiviral Therapy for RAG1 Severe Combined Immunodeficiency (SCID))

Under an exclusive license and in partnership with LUMC, MB-110, a first-in-class ex vivo treatment for RAG1 SCID, is under development.

Severe combined immunodeficiency (“SCID”) due to complete recombinase-activating gene-1 (RAG1) deficiency is a rare, genetic disorder due to null mutations in the RAG1 gene resulting in less than 1% of wild type V(D)J recombination activity.

Neonatal patients present with life-threatening, severe, recurrent infections by opportunistic fungal, viral and bacterial micro-organisms, as well as skin rashes, chronic diarrhea, failure to thrive and fever.

Immunologic observations include profound T and B cell lymphopenia, low or absent serum immunoglobulins, and normal natural killer cell counts.

As is the case with other types of SCID, RAG1-SCID is fatal in infancy unless immune reconstitution is achieved with hematopoietic stem cell transplantation (HSCT).

The ongoing clinical trial has enrolled its first patient, and additional clinical

sites are expected to be added in the near future.

The RAG1-SCID program has been granted Orphan Drug Designation by the European Medicines Agency.

Mustang also established an ongoing partnership with Frank J.

Staal, Ph.D., professor of Molecular Stem Cell Biology and molecular immunologist at LUMC, whose laboratory developed the MB-110 therapy.

Staal will continue the development of additional LV gene therapies in his lab, to which Mustang Bio has rights under the agreement.

INTELLECTUAL PROPERTY AND PATENTS

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The portfolio of rights licensed from COH now includes patents and application directed to CARs targeting IL13Rα2, CD123, CS1, HER2, and PSCA, as well as rights related to modified CAR hinge regions and methods of preparing CAR T cells in particular subpopulations of cell and administering CAR T cells.

The intellectual property licensed thereunder relating to IL13Rα2-targeting CARs includes granted patents in the U.S., Australia, China, Europe, Russia, Japan, Hong Kong, Israel, and Mexico, and this patent family further includes pending applications in the U.S., Australia, Brazil, Canada, China, Europe, South Korea, Russia, Japan, Israel, Mexico, and New Zealand.

The intellectual property licensed thereunder relating to IL13Rα2-targeting CARs includes granted patents in the U.S., Australia, China, Europe,

Russia, Japan, Hong Kong, Israel, and Mexico, and this patent family further includes pending applications in the U.S., Australia, Brazil, Canada, China, Europe, South Korea, Russia, Japan, Israel, Mexico, and New Zealand.

Any patents issuing from the IL13Rα2-targeting CAR will expire no sooner than 2035.

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In addition to patent protection, we may utilize orphan drug regulations or other provisions of the Food, Drug and Cosmetic Act of 1938, as amended (the “FDCA”), to provide market exclusivity for certain of our product candidates.

Orphan drug regulations provide incentives to pharmaceutical and biotechnology companies to develop and manufacture drugs for the treatment of rare diseases, currently defined as

diseases that exist in fewer than 200,000 individuals in the U.S., or diseases that affect more than 200,000 individuals in the U.S.

Orphan drug regulations provide incentives to pharmaceutical and biotechnology companies to develop and manufacture drugs for the treatment of rare diseases, currently defined as diseases that exist in fewer than 200,000 individuals in the U.S., or diseases that affect more than 200,000 individuals in the U.S.

but for which the sponsor does not realistically anticipate will generate a net profit.

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In October 2020, the Company entered into a Clinical Research Support Agreement for the IL13Rα2-directed CAR T program for adult patients with leptomeningeal glioblastoma, ependymoma or medulloblastoma (the “IL13Rα2 Leptomeningeal CRA”).

Pursuant to the terms of the IL13Rα2 Leptomeningeal CRA, the Company made an upfront payment of approximately $29,000 and will contribute an additional $150,000 per patient in connection with the on-going investigator-initiated study.

Pursuant to the terms of the IL13Rα2 Leptomeningeal CRA, the Company made an upfront payment of approximately $29,000 and will contribute an additional

$150,000 per patient in connection with the on-going investigator-initiated study.

Further, the Company agreed to fund approximately $200,000 annually pertaining to the clinical development of the IL13Rα2-directed CAR T therapy.

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Pursuant to the SRA, the Company funded research in the amount of $0.3 million for the program.

In November 2022, the SRA was amended to include additional funding of $0.6 million.

Spacer License

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Pursuant to the IV/ICV License, in March 2017, the Company paid COH an upfront fee of $0.1 million.

COH is eligible to receive a

milestone payment totaling approximately $0.1 million, upon and subject to the achievement of a milestone, and an annual maintenance fee.

COH is eligible to receive a milestone payment totaling approximately $0.1 million, upon and subject to the achievement of a milestone, and an annual maintenance fee.

Royalty payments in the low single digits are due on net sales of licensed products.

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Royalty payments in the mid-single digits are due on net sales of licensed products.

The Company is obligated to pay COH a percentage of certain revenues received in connection with a sublicense ranging from the mid-teens to mid-thirties, depending on the timing of the sublicense in the development of any product.

The Company is obligated to pay COH

a percentage of certain revenues received in connection with a sublicense ranging from the mid-teens to mid-thirties, depending on the timing of the sublicense in the development of any product.

CS1 CRA (multiple myeloma)

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Royalty payments in the mid-single digits are due on net sales of licensed products.

Fred Hutchinson Cancer Research Center

Fred Hutchinson Cancer Center

CD20 Technology License

Effective July 3, 2017, Mustang entered into an exclusive, worldwide licensing agreement with Fred Hutch for the use of a CAR T therapy related to autologous T cells engineered to express a CD20-specific chimeric antigen receptor (the “CD20 Technology License”).

Pursuant to the CD20 Technology License, the Company paid Fred Hutch an upfront fee of $0.3 million and owes an annual maintenance fee of $50,000 on each anniversary of the license until the achievement by the Company of regulatory approval of a licensed product using the CD20 Technology.

Pursuant to the CD20 Technology License, the Company paid Fred Hutch an upfront fee of $0.3 million and owes an annual maintenance fee of $50,000 on each

anniversary of the license until the achievement by the Company of regulatory approval of a licensed product using the CD20 Technology.

Additional payments are due for the achievement of eleven development milestones totaling $39.1 million.

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In November 2020, the CD20 CTA was amended to include additional funding of approximately $1.8 million for the treatment of five patients with chronic lymphocytic leukemia (“CLL”) and other research costs.

In January 2022, the CTA was amended to increase funding by approximately $2.2 million for the treatment of additional patients.

What changed 10-K

Item 1. Business