Q1 2021 Aveo Pharmaceuticals Inc Earnings Call
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Good afternoon.
And welcome to the day of oncology first quarter 2021 financial results Conference call. At this time all participants are in a listen only mode. After the speaker's presentation there'll be a question and answer the first one.
I asked the question of at that time. Please press Star then one on your touch tone telephone.
As a reminder, today's conference call is being recorded I would now like to turn the conference of the host Mr. Eric with their Chief Financial Officer from Beth Sir. Please go ahead.
Thank you operator, good afternoon, and thank you all for joining us on today's call to discuss the value of its first quarter 2021 financial results and business update.
Im joined today by Michael Bailey, Chief Executive Officer, Mike Farrell of RSO, Chief Commercial Officer, and Dr. Michael Needle Chief Medical Officer before.
Before we begin today's call. Let me remind you that during this discussion we will be making forward looking statements within the meaning of the private Securities Litigation Reform Act of 1095 of.
These forward looking statements are subject to important risks and uncertainties, including those that are detailed in today's press release and in the risk factors section of our most recent quarterly report on form 10-Q, which is on file with the SEC that may cause actual results to differ materially from those expressed in such statements. Furthermore, we of course.
Can you that these forward looking statements represent our views only as of today and we do not assume any obligation to update these statements whether as a result of new information future events or otherwise except as required by law.
With that I'll now turn the call over to our President and Chief Executive Officer, Michael Bayley Michael.
Thank you Eric and good afternoon, everyone. Thank you for joining us on today's call.
We are excited to have the opportunity today to share with you our progress with the did the launch as well as the business and financial results for the quarter.
During this call we plan to provide you with our early launch metrics through April 30th in an effort to provide you with the snapshot of our initial launch performance.
Before we get into the details of the initial launch metrics I would like to mention the recent release of abstract titles from Masco.
At this year's meeting and we look forward to presenting updates from the Tivo three studies that explore long term patient follow up and further highlight the <unk> unique tolerability profile.
In addition, we are excited to present the results from our randomized confirmatory phase III trial for <unk>, plus or minus urban tuck in a population of head and neck patients who have progressed through all available therapies, including platinum PD, one and urban tux.
Now turning to the launch at the tip of.
The first quarter of 2021 has been a truly transformational time for aveo marked by U S. FDA approval of our first commercial product. The tinder are differentiated once daily Veg F. R T chaos.
<unk> is approved for the treatment of adults with relapsed or refractory advanced renal cell carcinoma or RCC, following two or more prior systemic therapies.
Notably this approval was based on the phase III Tivo three study, which is the first positive RCC phase III study in the setting and the first RCC phase III study to include a pre defined subpopulation of patients who received prior immunotherapy the standard of care in earlier line treatment.
Prior to the tip of disapproval the therapies used in these settings, where typically chosen based on extrapolating clinical data from earlier treatment settings and from clinical datasets that did not include prior immunotherapy.
In addition of large percentage of patients opted out of later line therapy due to concerns with Tolerability.
With the U S FDA approval of the tender the oncology community now has an evidence based treatment option with a manageable safety profile to offer patients and help address the significant unmet need.
The importance of the 10th of this new role in the treatment paradigm was underscored by a tradition to the national comprehensive cancer Networks' clinical practice guidelines or N C. C. N in March as recommended regimen for subsequent therapy.
With the FDA approval in hand, we were able to rapidly execute on the commercial launch thanks to the hard work of our commercial and medical affairs teams, leading up to the Fda's decision coupled with the full deployment of our sales organization.
While it is still early we are pleased with the initial positive indicators.
In an effort to provide you with a snapshot of our preliminary launch performance I will now turn the call over to Mike per restaurant to provide an update on the commercial launch Mike.
Thank you Michael.
As Michael mentioned, we're very encouraged by the progress we have seen thus far in the launch of protein that we.
We are pleased to share with you results from our first reported quarter as the commercial stage company as well as some more recent launched insights that we've observed in the second quarter through the end of April.
Recall that flow Tiptoe was approved on March 10th 2021 with commercial availability, formerly commencing on March 22021.
For the nine days until the end of the first quarter net product revenue was $1 1 million, which reflects inventory shipped to distributors and our 15% gross to net estimate.
It's important to note that since the close of the first quarter all of our distributors have reorder product and in fact, all of them have re ordered more than once.
Through April 30th a total of 49 commercial prescriptions have been filled through our specialty pharmacy and specialty distributor partners and Additionally, 75 protiviti. The free one month patient experienced starter kit samples have been requested and delivered representing a potentially important leading.
Or for future prescriptions.
Well we're in the early days of this launch we believe we are off to a strong start.
We continue to focus on educating the community and raising awareness of how <unk> can help fill the unmet need in the treatment continuum.
Key to this effort is establishing for tiptoes differentiation, including its distinct characteristics as a potent highly selective long half life verger of receptor Teekay I as well of sharing the unique dataset of establishing tivo three.
Our commercial outreach spans prescribers across all settings from major academic centers to the community.
While the COVID-19 restrictions have slowed our ability to reach all of our customers as quickly as we would like the reception to Protiviti has been very positive.
Net need Israel and of reach expense deeper in the RCC market every day, we're in the field.
As with any new launch initial prescriptions take time to fill as we establish of reimbursement. We've had very few of reimbursement rejections and continue to improve our coverage and thus reduce the time from physician prescription to patient use.
Our quick start program has been effective of getting patients on active treatment quickly and avoiding any interruption of patient care will benefit verification is underway.
I will now turn the call over to Michael needle to discuss progress with the remainder of our clinical development programs Michael.
Thank you Mike.
While we are keenly focused on executing on growth from 10 of this launch we continue to make meaningful progress advancing the bounds of our clinical pipeline.
In addition to the current monotherapy approval. We are also focused on the evaluation of 2000 and the Ami.
No therapy combination setting the introduction of immunotherapy VEGF receptor teekay of high combinations marked a significant evolution in the treatment landscape of first line RCC.
We believe that this benefit could extend of the relapsed refractory setting with an effective well tolerated combination.
In March we were pleased to announce our clinical trial collaboration and supply agreement with Bristol Myers Squibb to evaluate the rosin and in combination with the volume man or Opdivo, Bristol Myers Squibb's anti PD one therapy.
And the planned phase III to needs of two trial for patients with advanced relapsed refractory RCC following prior immunotherapy exposure.
Recall that we previously assessed this combination in the phase one two to needle study, which demonstrated a favorable tolerability and prolonged PFS in both treatment naive and previously treated patients with advanced RCC, we look forward to furthering our understanding of the activity and Tolerability of this combination.
<unk> following prior immunotherapy.
The recently received FDA feedback on the trial design and we are working with the agency to finalize the study design.
We are targeting to commence enrollment and to me from two in mid 2021.
We also remain on track to complete enrollment later this year and the phase II portion of the phase one b two deductive trial of <unk> in combination with durable Lou Matt or intimacy.
Astrazeneca is PD L. One therapy.
Patients with the pattern of cellular carcinoma HCC.
At the <unk> Gi cancer Symposium in January we shared data from the phase one of the portion of the trial no debt.
Some of the toxicities were observed with the combination, which demonstrated a 29% partial response rate and 71% disease control rate the.
These findings were compatible with the Bevacizumab and tens of Elysium of combination, which is an emerging standard in the care of the same center.
With a five year survival rate of less than 5% zone.
Non metastatic HCC represents an area of high unmet need.
We believe provide from the past the potential to serve as an attractive the Jefferies. After teaching of ought to be used in combination with immunotherapy in this disease.
Moving to cycle the truth of Mad are H D. F C met inhibitor.
In January we announced completion of enrollment in the randomized confirmatory phase III study of <unk>, which is the NAV.
As a single agent or in combination with Cetuximab for Botox and Egfr targeted antibody.
And metastatic head and neck squamous cell carcinoma patients, who have failed prior immunotherapy chemotherapy and cetuximab. This.
This study was designed to confirm findings from the phase one two study of cycle of twos of man and Cetuximab or the.
The combination was well tolerated and resulted in a disease control rate of 67%.
Well as prolonged PFS and OS compared to historical control.
We will present results from the phase II study at the upcoming Astro meeting in June with a fee.
Phase III go no go decision from FICO, Tuesday night, and head and neck squamous cell cancer to follow as a reminder, in September 2020, when the regained full global rights to <unk> and have initiated a clinical manufacturer to supply the potential phase III clinical trial and the.
Head and neck squamous cell cancer and consider additional development beyond that.
Progress also continues from early stage programs, 80, 380, and even two or three.
480, 380, our G. D. F 15, inhibitory antibody that we are developing as the potential treatment for cancer Cachexia a.
Phase one study in healthy volunteers is now underway following the fda's acceptance of our IND application earlier this year.
Guide us on our safety and dosing profile ahead of our advance into cancer patients.
Finally for 82 O three are the three inhibitory antibody in March we were pleased to share that we will regain full global rights to a V. Two O three following the voluntary termination of our collaboration and license agreement with can bridge.
We expect to provide an update on clinical development plan in the second half of this year.
With that I will hand, the call over to Eric to discuss first quarter 2021 financial results.
Eric.
Thanks, Mike.
We ended the first quarter of 2021 with cash cash equivalents and marketable securities of $121 4 million compared with $61 8 million at December 31, 2020. We also have an additional $10 million of available credit from Hercules, which gives us up to a $130 million of total potential of.
Payable of capital. This figure includes the approximately $78 million, we added to our balance sheet. During the first quarter of 2021, consisting of a $20 million drawdown under our previously announced $45 million loan and security agreement with Hercules capital $3 1 million from warrant exercises as of March 31 2002.
The one $3 4 million in stock sales under our at the market sales agreement with SBB marriage, and $51 6 million in net proceeds from a public offering of our common stock.
Net product revenue for the first partial quarter of 2021, which consisted of a total of nine calendar days was $1 $1 million.
Research and development expense for the first quarter 2021 was $5 $8 million compared with $7 8 million in the first quarter of 2020.
Selling general and administrative expenses for the first quarter of 2021 was $15 1 million compared with $3 7 million in the first quarter of 2020.
The net loss for the first quarter of 2021 was $22 million.
Or a net loss of 81 per basic and diluted share compared with the net loss of $8 $4 million for the first quarter of 2020 or a net loss of 52 cents per basic and diluted share.
We continue to expect that our commercial spend will be approximately $40 million per the year.
Gross margin should continue to be in the mid to high 80% range.
R&D should be around $40 million for existing pipeline plans. During 2021. In addition quarterly G&A should approximate the levels seen during the first quarter for the remainder of the year.
We expect that our existing cash cash equivalents and investments and available credit under the Hercules facility will be sufficient to fund our launch and current pipeline plants.
Overview of results for the first quarter 2021 are available in our quarterly form 10-Q, I will now turn the call back over to Michael Bayley Michael.
Thanks, Eric before we open the call for Q&A I'd like to take a moment to thank the entire aveo team for their hard work and unwavering dedication to our mission to improve the lives of patients with cancer.
With the U S commercial launch of the tip of the now fully underway, we are thrilled to be able to bring this exciting new therapy. The patients battling relapse of refractory kidney cancer, who are in dire need of an effective and well tolerated treatment options.
Looking ahead, we look forward to continued progress with the commercial launch of the Tuesday here in the U S. As well as the continued advancement of the remainder of our pipeline programs. We believe we are well positioned for success and look forward to providing updates on our progress in the coming quarters. We will now open the line to Q&A.
Operator.
Thank you again like the asked the question please.
And then one on your Touchstone telephone against the asked the question. Please press Star then one.
Our first question comes from Stephen Wiley of Stifel. Your line is open.
Yes. Good afternoon, thanks for taking the questions and congrats on the progress of.
Appreciate some of the early metrics here and I know, it's early days, but.
Is there any color that you can provide or any commentary that you can speak to just with respect to I guess, where you see initial traction and I know that you talked in your opening comments about the.
The lack of.
The lack of evidence based treatment options of this I guess third line plus setting or are you seeing patients switched off of.
You know I guess kind of an older Teekay thats been recycled into later line without evidence or are most of the scripts that you're seeing written are these.
Patients, who are kind of new to third line.
Hey, Steve Thanks for the question this is Michael Bailey.
I'm going to pass this over to Mike give you a little color, we don't have quantitative.
Dallas is at this point.
The detailed but I think the color might be helpful.
Great. Thanks for the question Steve So.
As you said it is very early so all we have at this point is really anecdotal information about the setting and prior treatments, but I will say, we are hearing of patient starts and in all of the relevant setting so what I mean by that are we.
I've seen patients immediately following frontline combination treatment.
We've seen the more traditional third and fourth line use and we've also seen some patient starts and more of a very late line, who may have opted for no further therapy, where folks who've been on available.
Considering hospice so across the gamut.
Okay, and then I know you had mentioned I think that maybe COVID-19 is kind of impacting your ability to reach all of the accounts, but I guess.
Of the internal target of high priority accounts that you have.
What proportion of those have you reached in part of the split between academic and community prescribers.
Steve So we're not reporting the specific reach numbers at this point.
But what we are seeing is as we expected launching in COVID-19. The restrictions have slowed our ability of bit to reach our customers as quickly as we would like.
The pre COVID-19 world, So nothing unique to us.
But that said of the reception to tiptoe has been very positive.
And every day were out there we get a little deeper into the targets. So you can imagine initially we're focused on the highest tier targets and will continue to work our way through the list and as we gain adoption. We can go deeper and deeper overtime into the the community setting where they still have these patients but fewer on an account basis.
Okay, and then maybe just lastly on <unk>. Two is there anything that you can say just with respect of the regulatory feedback that you've received in.
Whether or not that's just the function of.
Trial design or protocol specific.
Questions.
Questions or issues that the agency might have.
Yeah.
Like again.
We're not going to comment specifically on the regulatory feedback, but I think.
With our guidance and say, we're responding to their questions and we still feel like we're on track for.
Midyear start.
Wonderful thanks for taking the questions and congrats.
Thank you.
Thank you. Our next question comes from common cause of the of Baird. Your line is open.
Hi, good afternoon. Thanks, so much for taking the questions and congrats on all the time.
At the corner.
One of the sample program that you're doing can you talk about logistically, how that's gone with the rollout and how many doses each sample in Queens.
Yeah, Mike do you want to take that one.
Sure Great. Thanks, Colin for the the question so our sample program or as we call it the.
Patient experience program.
At full one month's supply bottle that can be requested by the physicians treating kidney cancer patients.
We have because of this virtual and in person setting we can get of signature live first sample request, we can do it remote the AR.
Zoom type of setting.
And that simply goes back to us and it gets mailed to them within a day or two so they get the physical product and again, it's a full.
One month supply of drug. So the reception has been fantastic people are very excited to have the opportunity to get their hands on the drug habit and their sample closet and the next time they have an appropriate patient day, they get the patient experience opportunity for themselves. So as we mentioned we've distributed through the end of April of about 75 of these patients.
<unk> experienced start kit so.
It's a full month supply so it will take a little while to see the conversion rate of those into commercial prescriptions, but we think this could very well be of good leading indicator of interest.
Yes, Kelly do just as a reminder of why this is an important program growth.
Feedback, we've gotten from physicians, who have used the drug as they get a very good impression.
Certainly of the Tolerability when.
When they get a chance to actually try the drug. So the this is the program that we can try to encourage that early trial, hopefully that will turn into long term usage.
Great. Thank you that's very helpful.
I know, it's still early I know you mentioned, 15% gross to net any insights into how that's looking so far into Q versus what your expectations are.
Thank you Wendy trove of them.
Yes, it's very early I don't think we have any updated estimate for Q2 at this point I think the 15% per Q1 is.
All of that we've calculated to this point.
Makes sense.
For the.
The day that the trial in each of them.
Can you comment on enrollment in the phase two and when we might see data from that study and then also what the path kind of look like.
Yeah.
That could make it on the takeout.
Sure.
We actually don't provide updates on the on the enrollment although we still feel we are on track to complete enrollment by the end of the year.
The options really going forward.
Obviously, the obviously we are currently in the first line and we could we could consider for the first line of work.
Let the possibility actually is to look at what to do in the second line of following the Tesla for example.
Hum.
Obviously, there's the low approved theres nothing really been tested in that setting and this is actually not unlike what we're doing with to me go too.
These are conversations that we are having and will continue to have with our partner AZ.
They're in this half half of us so.
It's open for further thought.
Yes, just as a reminder, kelly in the.
We did report the phase one data at <unk> Gi, we had at 29% response rate and 71% disease control, which is comparable to what debt because I saw in that setting. So we're encouraged by that what we're seeing and as Mike said.
If we can complete the enrollment of as planned I would expect to be getting data reported.
Early 2022.
Awesome, that's really helpful and that's likely because of that.
And one of my question the faculties map update at <unk> can you remind us what the powering was part of that study.
Like did we report that.
No that's.
Not from there to make sure I'm not on mute.
That's not really the design of the study of the way. The study was designed was almost as if it was too was to phase two is wrapped up in one one was five of the Tuesday of single agent. The other words, the combination and in both cases the combination with Cetuximab.
And then on the patient population was like the phase one patients who had failed so.
Some of them the actual criteria for calling.
Calling a one of the two or either of the two arms positive.
Does a progression free survival that excluded two months, where the lower confidence bound was less than two months. So that's that's the actual powering of such as it is there is no real powering for comparison.
Obviously, what we'll be able to reported as our debt partner should be fair.
With Doctor Baumann will report Azgul will be.
Additional to that.
<unk> rates.
And mediums the usual but.
It wasn't really powered to compare the two arms.
That's really helpful. Thank you.
Thank you.
Next question comes from RK with H C. Wainwright Your line is open.
Thank you good afternoon, Michael Eric and Mike.
Glad to see the frontline scripts come in the first full month.
Of launch.
Could you.
You know the measure.
If you are able to do this but what percentage of the scripts are all of these.
The first time steps of that.
The orders within that and also Oh, it's cooked has just like what you said on the.
On the samples.
Is it more just of a what is the.
A number of sales or is it a month.
Months strength or is it more than a month.
Drug made script.
So Mike you want to take the like the rest of them.
Sure. Thanks for the question RK so.
As you can imagine this early on we haven't yet had time for patients who need of refill. This is still reporting on essentially all of our first.
Five weeks of launch.
So the it's all been new patient starts for prescriptions, we do have a few physicians who have started more than one patient.
But the majority of its starting their first patient and the number of pills.
Pills or the the duration of the prescription is 28 day. So it's we're dose three weeks on one week off for 28 day cycles through each of these prescriptions is essentially a one month supply.
Okay and then.
Then.
You know of.
Of the 75 samples.
There.
In your own thinking and of what percentage of current conversion.
Would you consider assets.
The successful.
The <unk>.
Successful at this point.
Yeah.
That's the trick question Mike.
[laughter], yeah, great Great question RJ.
Our understanding is we believe the physicians who put through the effort to request the sample intend to use it I think the the the.
Bigger question I guess for us and what we'll be watching is just the time.
And how long they have possession of it if they are busy practice. They may have the patient come in or patient of mine at that moment. If there are lower volume practice. They may have some patients who are now on an earlier treatment of and they want to use it for the an accident, it's just going to be a matter of.
When that patients current therapy is no longer working and they want to make that switch.
So we think again, they're only going through the effort to request. These samples because they intend to use them. We just don't know exactly when the right patient is going to present for that particular position.
Okay.
And then on the.
The test I'm in the third line.
For RCC accounts or something.
To date has been on the clinical studies the until towards the reduction.
So what are you doing.
In terms of not on the establishing of market for.
For the therapy, but also trying to see if.
You can expand.
The market for the third line.
Mike you want to comment on that.
Sure.
Again, we feel we're in a very solid position, having the first approval specifically in the setting.
And when.
When we look at the market today, the third and fourth lines of about a $300 million market prior to our approval.
We see from the decision resources data that only about half of patients in third and fourth line that could be treated are going onto active treatment and those who are treated or treated for an average duration of only about four months. So we think there's a lot that <unk> can do here and we're very excited by the early traction that we've seen in the mark.
And we're getting great reception to our story and our customers are certainly confirming the unmet need as we understood. It in the setting and again the team is doing a fantastic job and we look forward to continued progress.
Okay and last question from me on day, one our T.
T D.
Two.
You know the.
The study's also looking at advanced relapsed refractory patients but.
Uh huh.
How different is this patient population and the T V or to come back to what you were looking at in two of three.
Yeah. Good question RK. It's simply stated basically these patients are going to be second or third line versus Tivo three was third or fourth line.
You also would have to have.
Immunotherapy immediately prior.
So where that was the subpopulation of the Tivo three is the entire population here so we'd expect to see.
Lots of the.
The Io Io combinations of PD, one <unk> combinations as the immediate prior therapy to this study and we think that keeping the io pressure on makes a lot of sense.
With the Tolerability of <unk>, we think the combination.
Could prove to be a.
A nice advance for patients.
Thanks, Thanks for taking all of my questions.
Thanks, Okay.
Yeah.
Thank you I'm showing no further questions at the time I like to turn the call back over to Michael Barrett for any closing remarks.
Thank you all for joining us today and thank you for your continued support we're excited about the.
The next coming quarters, so stay tuned.
Thank you all for joining us today and thank you for your continued support in the August.
From that.
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