Q3 2021 Deciphera Pharmaceuticals Inc Earnings Call
Yeah.
Unknown Executive: Good afternoon, everyone, and welcome to Decipher Pharmaceuticals' third quarter 2021 Financial Results Conference.
Good afternoon, everyone and welcome to the cipher Pharmaceuticals third quarter 2021 financial results Conference call.
Operator: Today's call is being recorded. At this time, I would like to turn the call over to Jen Robinson, Vice President of Bestor Relations. Jen?
Today's call is being recorded at this time I would like to turn the call over to Jen Robinson, Vice President Investor Relations.
Ken.
Operator: and transferred the call over to Jen Robinson, Vice President and Bestor Relations. Jen?
Thank you operator, welcome and thank you for joining us today to discuss the Cyprus third quarter 2021 financial results I'm, Jen Robinson, Vice President Investor Relations at just like that.
Jennifer Larson: Thank you, Operator. Welcome, and thank you for joining us today to discuss DeCypres' third quarter 2021 financial results. I'm Jen Robinson, Vice President of Investor Relations at DeCypherra. With me this afternoon to discuss the financial results and provide a general corporate update are Steve Herder, President and Chief Executive Officer, Stan Martin, Chief Commercial Officer, Matt Sherman, Chief Medical Officer, and Tucker Kelly, Chief Financial Officer. Before we begin, I would like to remind you that any statements we make on this call that are not, not historical facts, forward-looking statements reflecting the current beliefs and expectations of management may be subject to the safe harbor provisions of the Private Security Litigation Reform Act of 1995.
With me this afternoon to discuss the financial results and provide a general corporate update are Steve <unk>, President and Chief Executive Officer, Dan Martin Chief Commercial Officer, Matt Sherman, Chief Medical Officer, and Tucker Kelly Chief Financial Officer before we begin I would like to remind you that any statements. We make on this call that are not historical facts.
Looking statements, reflecting the current beliefs and expectations of management made pursuant to the safe Harbor provisions of the private Securities Litigation Reform Act of 1995.
Jennifer Larson: Examples of forward-looking statements made during this conference call include our expectations for our pre-clinical and clinical programs, commercialization of Kim Law, and 2021 and 2022 guidance. Forward-looking statements made on this call involve substantial risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements, and we cannot assure you that our expectations will be achieved.
Samples are forward looking statements made during this conference call include our expectations or our preclinical and clinical programs, our commercialization of <unk> and 2021 and 2020 guidance.
Looking statements made on this call about substantial risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward looking statements and we cannot assure you that our expectations will be achieved such risks and uncertainties include those set forth in our most recent quarterly report on form form.
Jennifer Larson: Such risks and uncertainties include those set forth in our most recent corollary report on Fort Form 10Q, as well as in our other FECC filings. We assume no obligation to update or revise any forward-looking statements. Following this call, a replay will be available on the company's website, www.dysifer.com. With that, I will not turn the call over to Steve Heard.
10-Q, as well as our other SEC filings, we assume no obligation to update or revise any forward looking statements. Following this call a replay will be available on the company's website Ww dot dot com with that I will now turn the call over to Steve Herbert President and Chief Executive Officer of the CFO Steve.
Steven L. Hoerter: President and Chief Executive Officer of Cypsoe. Thank you, Jen, and good afternoon, everyone. During the third quarter, we made significant progress against our strategic priorities, including both expanding the reach of Kinlock for patients with GIST around the world and providing important new data updates for the next two product candidates advancing through the pipeline and moving toward registration-directed studies. In the U.S., we have rapidly established Kenlock as the clear standard of care in fourth-line JIS, providing a strong foundation as we prepare to report top-line results from the Phase 3 Intrigue study in second-line JIS later this quarter.
Thank you John and good afternoon, everyone. During the third quarter, we made significant progress against our strategic priorities, including both expanding the reach of <unk> for patients with just around the world and providing important new data updates for the next two product candidates advancing through the pipeline and moving toward registration directed studies.
In the U S. We have rapidly established <unk> as the clear standard of care in fourth line, just providing a strong foundation as we prepare to report top line results from the Phase III intrigue study in second line Gist later this quarter.
Steven L. Hoerter: At ESMO, we presented long-term follow-up from the Phase 3 Invictus study, showing that Kenlock nearly tripled the overall survival benefit for patients in this setting. Based on the totality of the clinical data we have generated with Kenlock so far, we remain confident in the potential for Kenlock to fundamentally transform the treatment of this disease. Outside of the U.S., we continue our work to broaden the geographic reach of Kenlock.
At ESMO, we presented long term follow up from the phase III Invictus study showing that kinlaw nearly tripled the overall survival benefit for patients in this setting.
Based on the totality of the clinical data, we have generated with kinlaw. So far we remain confident in the potential for Ken lock to fundamentally transform the treatment of this disease.
Outside of the U S. We continue our work to broaden the geographic reach of Ken Lock in September we received a positive opinion from the EMA is CH empty and we expect EU approval for kinlaw in fourth line Gist later this quarter.
Steven L. Hoerter: In September, we received a positive opinion from the EMA's CHMP, and we expect EU approval for Kenlock in fourth-line GIST later this quarter. In October, we were also pleased to announce the approval of Kenlock by Swiss Medic, Switzerland's regulatory agency. This marks the seventh approval worldwide for Kenlock and our first approval in continental Europe.
In October we were also pleased to announce the approval of Ken locked by Swiss Medic Switzerland's regulatory agency. This marks the seventh approval worldwide for Ken <unk> and our first approval in Continental Europe.
Steven L. Hoerter: We are excited to bring this important new medicine specifically designed for GIST to patients in Europe who are in need of a new treatment option. Beyond Europe, our partner, Zylap, continues to execute on its launch of Kinloch and fourth Lungis in the Chinese market, where an estimated 30,000 new patients are diagnosed with this disease each year. Building on the recent regulatory approvals in China and Hong Kong, Zai received approval for Kenlock in Taiwan last quarter.
We are excited to bring this important new medicines, specifically designed for Jess to patients in Europe, who are in need of a new treatment option.
Beyond Europe, our partner XI lab continues to execute on its launch it can lock in fourth line gist in the China market, where an estimated 30000 new patients are diagnosed with this disease each year.
Building on the recent regulatory approvals in China, and Hong Kong XI received approval for Ken lock in Taiwan last quarter, we look forward to working with <unk> to provide kinlaw to just patients throughout greater China.
Steven L. Hoerter: We look forward to working with Zai to provide Kinloch to patients throughout Greater China. Later on today's call, Matt Sherman, our chief medical officer, will review the highly encouraging data updates we provided for Vimseltenib and Rabasinib at the ESMO meeting in September. We were excited to present these new data updates and disclose our plans to move forward with pivotal phase three studies for these novel product candidates. Forgimseltenib, our potential best-in-class CSF1 receptor inhibitor, we expect to initiate the Phase 3 motion study in patients with tenisinovial giant cell tumor this quarter, and for Rabastinid, our potential first-in-class TITU inhibitor, we expect to initiate We are leaders in targeting autophagy and cancer, and our old inhibitor, DCC 31116, is the first to enter the clinic in this important area of cancer research.
Later on today's call, Matt Sherman, our Chief Medical Officer will review the highly encouraging data updates, we provided for himself and Ed and robots in it at the ESMO meeting in September.
We were excited to present these new data updates and disclose our plans to move forward with pivotal phase III studies for these novel product candidates.
For consultative our potential best in class CSF, one receptor inhibitor, we expect to initiate the phase III motion study in patients with tennis and OBL giant cell tumor this quarter.
And for <unk>, our potential first in class tied two inhibitor, we expect to initiate a registration study next year.
We are leaders in targeting Autophagy in cancer, and our <unk> inhibitor. GCC 31, 2016 is the first to enter the clinic in this important area of cancer research and.
In June we initiated the phase one study of GCC 31, 2016, and we expect to present data from the dose escalation portion of this study next year in.
In October at the Triple meeting, we highlighted exciting new preclinical data with 31 2016 in combination with Egfr inhibitors for the first time, we described the upregulation of Autophagy and non small cell lung cancer preclinical models with also <unk>. The current standard of care for mutant Egfr non small cell lung cancer.
Steven L. Hoerter: In June, we initiated the phase one study of DCC 3116, and we expect to present data from the dose escalation portion of this study next year. In October, at the triple meeting, we highlighted exciting new preclinical data with DCC 3116 in combination with EGFR inhibitors. For the first time, we describe the upregulation of autophagy in non-small cell lung cancer pre-clinical models with osmurtenin, the current standard of care for mutant EGFR non-small cell lung cancer, and the significant antitumor synergy seen with the combination of DCC-31116 and osmertininine.
And the significant antitumor synergy scene with the combination of DCC 3116, and also Martin.
These data and the growing literature underscore the broad applicability of targeting Autophagy in cancer and the potential for <unk> 31, 16 to be combined with a number of targeted agents across the spectrum of solid and Hematological malignancies.
I'll now turn the call over to Dan Martin, Our Chief commercial officer to discuss the kinlaw commercial results from Q3, Dan.
Thank you Steve.
In Q3, we continued to execute on our commercial goals for kinlaw reinforcing its position as the standard of care in fourth line Gist and further strengthening the excellent Foundation. We have established ahead of our planned launch into the significantly larger second line setting.
In Q3, we achieved 21 7 million and total net product revenue globally, including $20 million in the U S. The core drivers of cannot demand remained consistent including new patient acquisition payer access and persistency.
Steven L. Hoerter: These data and the growing literature underscore the broad applicability of targeting autophagy and cancer and the potential for DCC 3116 to be combined with a number of targeted agents across the spectrum of solid and hematological malignancies. I'll now turn the call over to Dan Martin, our chief commercial officer, to discuss the Kenlock commercial results from Q3. Dan?
During the quarter, we increased our prescriber footprint by nearly 20% to approximately 530 prescribers since launch with most of this growth again coming from the community setting.
Other key performance metrics again demonstrated strong commercial execution and positive physician perceptions of kinlaw as in prior quarters, we achieved high levels of prescriber reach share voice and product awareness and prescribers again, good Kinloch high marks for efficacy safety convenience and ease of access.
Daniel C. Martin: Thank you, Steve. In Q3, we continue to execute our commercial goals for Kinlock, reinforcing its position as the standard of care in fourth-line gist, and further strengthening the excellent foundation we have established ahead of our planned launch into the significantly larger second-line setting. In Q3, we achieved $21.7 million in total net product revenue globally, including $20 million in the U. The core drivers of Kinlock demand remained consistent, including new patient acquisition, payer access, and, During the quarter, we increased our prescriber footprint by nearly 20% to approximately 530 prescribers since launch, with most of this growth again coming from the community setting.
Consistent with our guidance during our Q2 earnings call the percentage of patients receiving free drug under our patient assistance program or Paas was slightly higher than our 20% to 30% estimated range due to increased patient affordability challenges within the Medicare part D patient population.
Additionally, as expected the Q3 gross to net adjustment increased significantly versus Q2 and was in line with our projected annual average of 15%.
In Q4, we expect the core drivers that can market demand to remain consistent and we expect the Pat percentage and gross to net adjustment to be in line with Q3.
Looking ahead, our team is hard at work preparing for the second line launch, where we expect to benefit from the clinical experience and positive product perceptions. We have already established since launch. In addition to the approximately 530 just traders who are prescribed kinlaw, we've reached almost 3000 additional position.
Daniel C. Martin: Other key performance metrics again demonstrated strong commercial execution and positive physician perceptions of Kinloz. As in prior quarters, we achieved high levels of prescriber reach, share voice, and product awareness, and prescribers again gave Kinlock high marks for efficacy, safety, convenience, and ease of use. Consistent with our guidance during our Q2 earnings call, the percentage of patients receiving free drugs under our patient assistance program or path was slightly higher than our 20 to Additionally, as expected, the Q3 gross net adjustment increased significantly versus Q2 and was in line with our projected annual average of 15.
Mostly in the community setting.
Where potential traders of earlier line patients.
Recent market research has also been very encouraging.
In a recent market research survey Gist treaters rated kinloch higher than Sunitinib across all product attributes tested based on their experience with the two agents. We believe can lock has the potential to establishing new standard of care in second line setting and we look forward to helping even more patients gain access to this important medicine.
I will now turn the call over to Matt.
Yeah.
Thank you Dan.
We've made tremendous progress advancing our clinical stage pipeline this year.
He used to share the encouraging results we have in each of our programs.
Certainly we're working towards our mission to discover develop and deliver important new medicines to patients for the treatment of cancer. We are rapidly advancing our clinical development programs forward.
First I'd like to start with <unk> and the phase III intrigue study comparing <unk> to submit that in patients with second line Gist.
Daniel C. Martin: In Q4, we expect the core drivers of Kinlock demand to remain consistent, and we expect the PAP percentage in gross to net adjustment to be in line with. Looking ahead, our team is hard at work preparing for the second line launch, where we expect to benefit from the clinical experience and positive product perceptions we have already established. Since launch, in addition to the approximately 530 just treaters who have prescribed Kinlock, we have reached almost 3,000 additional physicians, mostly in the community setting, who are potential prescribers of earlier lines. Recent market research has also been very encouraging. In a recent market research survey, Gist prescribers rated Kinlock higher than SunitNip across all product attributes based on their experience with the two agents.
We expect to report top line results this quarter and we remain confident in the likelihood of success in this pivotal study.
We are also excited to move forward with our next pivotal development program themselves and then our potential best in class inhibitor of sales up one arm.
This quarter, we expect to treat the first patient in the motion study the global randomized placebo controlled phase III study in approximately.
With symptomatic could UCT non amenable to surgical resection.
And the double blind period of the study eligible patients will be randomized two one to one to receive either been Sultanate 30 milligrams twice weekly or placebo for 24 weeks.
Following the evaluation of the primary endpoint of objective response rate at week 25 patients will have the option to continue work Chris over to themselves. During the open label period of the study.
I am extremely proud of our team for getting this pivotal study up and running so quickly.
It was a great unmet medical need and TCT syndrome Ultimate may offer a new best in class treatment option for these patients today. There is only one approved product for this indication.
Daniel C. Martin: We believe Kinloch has the potential to establish a new standard of care, second line setting, and we look forward to helping even more patients gain access to this important. I will now turn the call over to Matt. Thank you, Dan.
<unk>, which has a black box warning and subject to a rems program to the potentially fatal hepatic toxicity and adverse event that was thought to be an off target effect.
Interestingly most patients are using off label.
Treat their disease.
Matthew L. Sherman: We've made tremendous progress advancing our clinical stage pipeline this year, and I am pleased to share the encouraging results we have in each of our programs. Importantly, in working towards our mission to discover, develop, and deliver important new medicines to patients for the treatment of cancer, we are rapidly advancing our clinical development programs forward. First, I'd like to start with Kinlock in the Phase 3 Intrigue study, comparing Kinlock 2 submit and patients with second line gyp. We expect to report topfying results this quarter and remain confident in the likelihood of success in this pivotal study.
The net net is a week <unk>, one inhibitor, which is not approved for TCT and is listed in the MCT and guidelines based on limited data from a retrospective study that showed a lower response rate.
We are excited to announce today that we have received fast track designation for some softness from the FDA for treatment of patients with symptomatic <unk> core non medical to surgery.
This designation is designed to get important drugs to patients in need faster and is intended to help facilitate the development of the Sultanate and expedite its regulatory review.
The motion study was designed based on the exciting safety and efficacy results from the phase one two study we recently presented at ESMO This year.
We reported a 47% objective response rate across all cohorts in the phase one dose escalation portion of the study and from patients without CSF, one our treatment exposure cohort.
Matthew L. Sherman: We are also excited to move forward with our next pivotal development program, Themselta, our potential best-in-class inhibitor of CSF-1R. This quarter, we expect to treat the first patient in the motion study, the global randomized placebo-controlled phase three study, and approximately patients with symptomatic TGCT non-amendable to surgical resection. In the double-blind period of the study, eligible patients will be randomized to receive either Vimpsilininin, 30 milligrams twice weekly, or placebo for 24 weeks.
The phase two extension portion of the study.
The encouraging preliminary data from core is still early and we're looking forward to longer follow up.
Treatment with <unk> was generally well tolerated in patients with <unk>. The majority of the common treatment emergent adverse events, 15% accretive we're great two or lower.
Now turning to our other late stage clinical program with estimate.
Our potential best in class tie two inhibitor.
Planning is ongoing for a phase III pivotal study of <unk> in platinum resistant ovarian cancer. A book, we expect to initiate this study next year following feedback from health insurance.
Earlier this year, we presented exciting preliminary data at ESMO from the ongoing phase <unk> study of her desk the carbon neutral paclitaxel in heavily pretreated patients.
Matthew L. Sherman: Following the evaluation of the primary endpoint of objective response rate at week 25, patients will have the option to continue or cross over to philtinib during the open-label period of the study. I'm extremely proud of our team for getting this pivotal study up and running so quickly. There is a great unmet medical need for PGCT, and Vumsultamin may offer a new best-in-class treatment option for these patients Today, there is only one approved product for this indication, Pexidarkinic, which has a black box warning and is subject to a REMS program for potentially fatal hepatotoxicity, an adverse event that is thought to be an off-target effect. Interestingly, most patients are using off-label drugs and that to treat their disease.
The combination demonstrated promising median progression free survival was nine one months.
In addition to confirmed and unconfirmed objective response rate was 38% in the can.
First objective response rate was 29%.
Based on the published literature, the median progression free survival of single agent Paclitaxel is expected to be three to four months. While its objective response rate is expected to be 15% to 25%.
The combination was also generally well tolerated and most treatment emergent adverse events were grade one or two.
We recently received orphan drug designation in the EU for the treatment of ovarian cancer based on the positive opinion issued by the EMEA underscoring the significant unmet patient need that redemption has potential to address.
In addition to our late stage programs. We are very excited about our next generation of product candidates led by DCC 31, 16, our first in class <unk> kinase inhibitor that entered clinical development a few months ago.
<unk> kinase is the initiating factor in when you talk with you.
Matthew L. Sherman: And that is a weak CSS1R inhibitor that is not approved for TGCT and is listed in the NCCN guidelines based on limited data from a retrospective study that showed a low response. We are excited to announce today that we have received fast-track designation for Finsultonid from the FDA for treatment of patients with symptomatic TGCT who are non-amendable to surgery. This designation is designed to get important drugs to patients faster and is intended to help facilitate the development of themselfenib and expedite its regulatory review. The motion study was designed based on the exciting phase BMSC results from the phase one to study we recently presented at ESMO.
Pathway the key survival mechanism.
Sales recycled components to generate energy.
There is substantial and growing body of evidence showing the autophagy is up regulated in cancer cells to the stress of damage caused by anti cancer treatments.
And then in addition of Autophagy in combination with a variety of anti cancer agents may provide a novel approach to treatment by directly addressing one of the important escape mechanisms of plague many types of cancer therapy.
At the sites, where we have continued to generate preclinical evidence on the role of Autophagy in cancer.
At the recent Triple meeting, we presented new data demonstrating synergy with $31 16 in Egfr inhibitors are submerged in Kansas.
In non small cell lung cancer preclinical models.
In vitro data shows 31, 16 reduced autophagy that there's also the resistance mechanism after treatment with Egfr inhibitors in lung cancer cell lines.
In addition, the in vivo data demonstrated that the combination of <unk> hundred 16, with Egfr inhibitors resulted in significantly greater tumor responses in the lung cancer xenograft model compared to single agent treatment.
Matthew L. Sherman: We reported a 47% objective response rate across all cohorts in the phase one dose escalation portion of the study, and from patients without CSF1R treatment exposure, cohort A of the phase two expansion portion of the study. The encouraging pulmonary data from Color is still early, and we are looking forward to longer follow-up. Treatment within Fultoninic was generally well tolerated in patients with TGCT. The majority of the common treatments emerged as perils events, 15% or greater, were grade two or lower.
Researchers outside at the site for them also continued to add to the strong case for a potential role for <unk> inhibition in the treatment of both solid and Hematological malignancies.
When recently published study in nature cancer showed that non small cell lung cancers with an <unk> mutation, which is frequently mutated K risks are resistant to immune checkpoint inhibition, but can be re sensitize. The PD, one checkpoint inhibition of blocking the <unk> kinase and the pathogen.
Another recent study in science translational medicine showed that treatment of CML cell lines within the <unk> inhibitor and the amount of decrease growth. In addition, co treatment eliminated persistent leukemic stem cells, which drive PK or resistance in patients relapse once again, our leadership role in the field of the pathogen in cancer.
Matthew L. Sherman: Now turning to our other late speech local program, Rabasdinit, our potential best in class tied to and, Planning is ongoing for a phase three pivotal study of her gaspidinip and platinum resistant urine cancer or prox. We expect to initiate this study next year, following feedback from health inquiry. Earlier this year, we presented exciting preliminary data from ESMO from the ongoing phase 1B2 study of Erbastin of the carbonatial pachl and heavily pre-treated clotpatient. The combination demonstrated a promising median progression-free survival of 9.1 months. In addition, the confirmed and unconfirmed objective response rate was 38%.
Clothing, <unk> kinase and Vps 34 kinase physicians to say for it to make significant contributions to cancer patients in the near future.
These data provide additional support for the potential breadth of the GCC <unk> hundred 16 program, adding to the preclinical evidence supporting combination strategies with other cancer treatments, including MC Burke raft and direct <unk> inhibitors as well as PD, one PDL one checkpoint inhibitors.
Wide range of cancers.
We are actively pursuing preclinical combinations of <unk> with a variety of standard of care therapy and drugs acting by novel cancer mechanisms and look forward to reporting further on these studies next year.
Matthew L. Sherman: And the confirmed objective response rate was 29%. Based on the published literature, the median progression pre-survival of single-agent Pacal Taxa is expected to be three to four months, while its objective response rate is expected to be 15 to 25%. The combination was also generally well-tolerated, and most streaming emergent adverse events were grade one or two.
Our first area of focus for clinical development of <unk> for the treatment of Ras RAF mutated solid tumors in combination with the mechanism.
The ongoing phase one study has two parts the dose escalation phase and an expansion phase enrollment for the dose escalation phase of the study started in the second quarter of this year and will provide important single agent data for 31 team, including safety Tolerability pharmacokinetics and pharmacodynamics.
Data from this phase will also determine the go forward dose in the expansion phase of the study with <unk> 16 will be used in combination with tremendous in multiple tumor types.
Matthew L. Sherman: We recently received orphan drug designation in the EU for the treatment of ovarian cancer based on the positive opinion issued by the EMA, demonstrating the significant unmet patient need that regassive has potential to address. In addition to our late stage programs, we are very excited about our next generation of product candidates, led by DC State 3116, our first in class oak kinase inhibitor that entered clinical development a few months ago. The Oak kinase is the initiating factor in the autophagy pathway and a key survival mechanism in which it uses recycled components to generate energy.
We look forward to presenting data from the dose escalation phase next year.
We are strongly encouraged by the progress across each of our innovative programs and believe that these will make a meaningful difference in the treatment of patients with cancer.
Now I'll turn the call over to Tucker Kelly, our Chief Financial Officer to review the financial results Tucker.
Thanks, Matt I'd like to review the highlights of our third quarter financial results total revenues for the third quarter was $23 $2 million, which includes $21 7 million in net product revenue.
Net product revenues for the third quarter of 2021 includes U S sales of <unk> of $20 million and ex U S sales of Kinloch of $1 7 million the.
The gross to net adjustment in the third quarter was in line with our estimate of 15%.
Collaboration revenue for the quarter was $1 5 billion, which includes kinloch supply and royalty revenue under our agreements with XI lab for greater China.
Matthew L. Sherman: There is a substantial and growing body of evidence showing that autophagy is upregulated in cancer cells under the stress of damage caused by anti-cancer treatment. And the addition of autophagy in combination with a variety of anti-cancer agents may provide a novel approach to treatment by directly addressing one of the important escape mechanisms that plague many types of cancer therapy. Pethypherag, we have continued to generate preclinical evidence on the role of autophagy and cancer. At the recent triple meeting, we presented new data demonstrating synergy with 3116 and EGFR inhibitors of the Murninth and the fat mid and non-smusol lung cancer preclinical model.
Cost of sales for the three months ended September 30 of 2021 was <unk> 9 million, which included $2 million and cost of net product revenue for Kinloch product sales.
$7 million and cost of collaboration.
We do not expect that the cost of sales as a percentage of net product sales of Kinloch will increase significantly. After we have sold all zero cost inventory and commence the sales of inventories, which will reflect the full cost of manufacturing.
We expect to continue to sell the zero cost inventories that can lock in the U S. During the remainder of this year and into 2022.
Total operating expenses were $102 million in the third quarter of 2021 compared to total operating expenses of $79 4 million in the same periods in 2020.
Research and development expenses for the third quarter were $66 4 million compared to $49 2 million in the same period in 2020.
Selling general and administrative expenses in the third quarter with $35 5 million.
Compared to $30 1 million in the same period in 2020.
We expect that our operating expenses will increase as we continue to invest in the development of our clinical pipeline and execute on the commercialization of Kinloch in U S and prepare for potential commercial launch in Europe.
Matthew L. Sherman: In Detroit, data showed that 3116 reduced autophagy that develops a resistance mechanism after treatment with EGFR inhibitors and lung cancer cell lines. In addition, the in vivo data demonstrated that the combination of 3116 with EGFR inhibitors resulted in significantly greater tumor responses in the lung cancer xenograph model compared to single agent treatment. Researchers outside of Decipher have also continued to add to the strong case for a potential role of Tough gene inhibition in the treatment of both solid and hematological malignancies.
We ended the third quarter in a strong financial position and remain well capitalized with cash cash equivalents in marketable securities of approximately $392 million, which together with our anticipated product royalty and supply revenues, we expect will be sufficient to fund our operations into the first half of 2023 with that I'll now turn the call back over to Steve.
Sure.
Thank you Tucker as we enter the last quarter of 2021 I'm excited about what we've accomplished so far this year and the progress we've made across the company. We are well positioned for long term success as we prepare to launch <unk> in Europe and report the results from the Phase III <unk> study. In addition, we continue to advance the rest of our pipeline of first in class and best in class product.
Matthew L. Sherman: A recently published study in Nature Cancer showed that non-small cell lung cancers with an LKB1 mutation, which is frequently co-mutated with KRAS, are resistant to immune checkpoint inhibition that can be resensitized to the PD1 checkpoint in the vision after blocking the oak kinase and apothea. Another recent study in science translational medicine shows the treatment of CML cell lines with an autophagy inhibitor and a matinid decreased growth.
Candidates and we look forward to updating you on our future progress operator, I'd now like to open the call for Q&A.
And thank you.
As a reminder to ask a question you will need to press star one on your telephone to withdraw your question press the pound key.
These standby, we compile the Q&A roster and our first question comes from Chris Raymond from Piper Sandler.
Matthew L. Sherman: In addition, co-treatment eliminated persistent leukemic stem cells which drive TKI resistance in patient relapse. Once again, our leadership role in the field of autophagy and cancer, including O-Kinase and VPS-34 Kines, positions to Pfeiffer to make significant contributions to cancer patients in a near future, These data provide additional support for the potential breadth of the DCC 3116 program, adding to the pre-concil evidence supporting combination strategies with other cancer treatments, including MEC, ERC, RAS, and direct K-RAS G12C inhibitors, as well as PD1, PDL1, checkpoint, inhibitors, and a wide range of cancer.
Your line is now open.
Hey, Thanks for taking the questions just a couple quick ones.
Commercial questions here.
Dan I heard you talk about a lot of the metrics but.
I'm not sure I heard you talk about this last quarter I think you were indicating there was some intra patient dose escalation that was going on.
Past progression.
I'm just wondering if you could talk Directionally are you seeing that pick up is it. The same is there any sort of dynamic to that.
Especially since you had that data at <unk>.
It was published I think in July.
And then maybe just sort of another sort of <unk>.
Broader question I guess and I get this question. This is probably the most asked question I hear from investors is just thinking about.
How quickly can mark became standard of care in fourth line Gist.
Really maxing out the opportunity in three quarters.
How should we be thinking about.
The dynamic in the second line setting.
Obviously, it's a different.
Matthew L. Sherman: We are actively pursuing pre-clinical combinations of 3116 with a variety of standard of care therapies and drugs acting by novel cancer mechanisms and look forward to reporting further on these studies next year. Our first area of focus for clinical development of 3116 is for the treatment of rass-raft mutated solid tumors in combination with a neck inhibitor.
Sort of dynamic given that Theres, an established option.
In second line, but just kind of talk about sort.
The velocity.
Penetration.
Between fourth and second that you might be.
Anticipating assuming.
Obviously positive data this quarter.
Hey, Chris just see so let me let me take the first part of that and then I'll turn it over to Dan.
To address the other part of your question. So you referenced the IPD data from both Invictus, our randomized phase III study the fourth line study as well as from the Phase one and we were really pleased to see both of those datasets published in the peer reviewed literature is manuscripts over the course of the summer months and as you know from the data and certainly the feedback that we've heard from <unk>.
Thomas Patrick Kelly: The ongoing phase one study has two parts, the dose escalation phase and an expansion phase. Enrollment for the dose escalation phase of the study started in the second quarter of this year and will provide important single-agent data for 316, including safety, tolerability, pharmacokinetics, and pharmacodynamics. Data from this phase will also determine the go-forward dose in the expansion phase of the study where 3116 will be used in combination with fermentant and multiple tumor tumors. We look forward to presenting data from the dose escalation phase next year.
Leaders they view the PFS two data that we generated upon dose escalation as being very meaningful clinically for patients, especially when you look at the data as a fraction of the benefit the patients received as measured by PFS. One. So we're really encouraged by the data as you might remember in the phase one study the dose escalation part.
The study we didn't actually reach a maximum tolerated dose, which we're proud nib and we dose patients up to 400 milligrams daily. So we feel as if we have ample headroom for dose escalation and I think that's been evidenced.
Thomas Patrick Kelly: We are strongly encouraged by the progress across each of our innovative programs and believe that these will make a meaningful difference in the treatment of patients with cancer. I will now turn the call over to Tucker Kelly, our chief financial officer, to review the financial results. Thanks, Matt.
Evidenced by the data from <unk> from the phase, one and certainly even at that higher dose. The drug is remains well tolerated. So we're encouraged by the data and that underscores the efficacy of the product and just Dan do you want to address the rest of Christine's question with respect to what Youre seeing in the actual market in terms of utilization of IPG.
Thomas Patrick Kelly: I'd like to view the highlights from our third quarter financial results. Total revenues of the third quarter were 23.2 million, which included 21.7 million in net product revenue of Kenraud. Net product revenues for the third quarter of 2021 include U.S. sales of Kinlocks of 20 million and ex-US sales of Kinlock of 1.70. The growth to net adjustment in the third quarter was in line with our efforts of 15.
Sure absolutely thanks, Chris for the questions.
So on the IPD front.
As Steve said, the data has been really well received by.
The Kols in particular, who view this as a really meaningful benefit for patients and so there's certainly been interest there.
Thomas Patrick Kelly: Collaboration revenue in the quarter was $1.5 million, which included Kinglock supply and royalty revenue under our agreements with Zylaab for Greater China. Cost of sales for the three months ended September 30th, 2021 was $0.9 million, which included $0.2 million in cost of net product revenue for Kinloch products and cost of collaboration. We do not expect that the cost of sales as a percentage of net product sales of Kinloch will increase significantly after we have sold all zero-cost inventories and commence the sales of inventories, which will reflect the full cost of manufacturing.
<unk>.
The challenge, though is that of course. This is an off label. Those so we're not able to promote that we only of course per month consistent with our label dose.
And so.
What we see in the marketplaces relative.
Relatively consistent use which is.
A smaller portion.
Our overall dosing the vast majority of doses or at the labeled dose.
A couple of thoughts on this.
From a payer perspective.
What we see it's sort of inconsistent we see.
Some claims are approved for the.
The IBD dosing and others are not and it has not been added to the NCC guidelines thus far.
Thomas Patrick Kelly: We expect to continue to sell the zero-cost inventories of Kinlock in the U.S. during the remainder of this year and into 2022. Total operating expenses were $102 million in the third quarter of 2021, compared to total operating expenses of $79.4 million in the same period in 2020. Research and development expenses in the third quarter were 66.4 million compared to 49.2 million in the same period in 2020. Selling general and administration expenses in the third quarter were 35.5 million compared to 30.1 million in the same period in 20.
Remains to be seen if and when that will happen.
If it is and.
And if we think that could provide some momentum with respect to not only demand for use of that.
Dosing regimen, but also the access side of the equation.
So we'll just have to see how that plays out, but thus far and pretty consistent.
As a relatively small overall portion of our.
Dosing.
With respect to your second question.
Uptake in the second line.
Yeah, we've been incredibly pleased with the rapid uptake that we've seen in the fourth line and we just continue to see as I underscored in the prepared remarks, just tremendous support and belief in can lock in.
Steven L. Hoerter: We expect that our operating expenses will increase, so we continue to invest in the development of our clinical program, execute on the commercialization of Kinlock in the U.S., and prepare for potential commercial launch in Europe. We ended the third quarter in a strong financial position and remain well capitalized, with cash, cash equivalence, and marketable securities of approximately $392 million, which, together with our anticipated product, royalty, and supply revenues, we expect will be sufficient to fund our operations into the first half of 2023.
And really high scores across the board not just by users, but even more broadly as we've made more and more progress in reaching the community setting.
So really pleased with the progress thus far and we think it bodes extremely well for our second launch planned second line launch.
As I mentioned we've reached.
An additional 3000.
<unk> two are likely to be treaters of earlier line patients.
Beyond the 530 or so that have prescribed it to date and we.
We reached of course, we only message our fourth line indication to those.
Steven L. Hoerter: With that, I'll now turn the call back over to State. Thank you, Tucker. As we enter the last quarter of 2021, I'm excited about what we've accomplished so far this year and the progress we've made across the company. We are well positioned for long-term success as we prepare to launch Kenlock in Europe and report the results from the Phase 3 Treat Study. In addition, we continue to advance the rest of our pipeline of first-in-class and best-in-class product candidates, and we look forward to updating you on our future progress. Operator, I'd now like to open the call for Q&A.
Physicians to be clear because you never know where our fourth line patients is going to appear but the awareness that we've developed in that broader sense.
Potential future prescribers, we think sets us up extremely well and as I mentioned in the prepared remarks on the market research that we're seeing now suggests that just based on general experience and perceptions of the two drugs that actually many gist treaters.
Right Kinloch significantly higher than students. So for all of these reasons, we think that.
We're really well set up for second line, we think.
On a relatively rapid uptake, it's certainly possible.
The only other things I'll mentioned that will be things. We work through of course is as you mentioned there is an established therapy and we think that.
Operator: and things.
Operator: As a reminder, to ask a question, you'll need to press star 1 on your telephone. So write your question, press the pound key. Please stand by while we compile the Q&A roster. And our first question comes from Chris Raymond, from Pipe.
We will need to continue to reach and continue to impact the community more and more because we think that earlier line setting will be that much more.
<unk>.
The domain of the community physicians. So those are things that will be very focused on driving at launch, but we think for all the reasons listed we've got a great opportunity for a rapid penetration into second line pending data from intrigue.
Christopher Joseph Raymond: Hey, thanks for taking the questions. Just a couple quick ones, commercial questions here.
Daniel C. Martin: Dan, I heard you talk about a lot of the metrics, but I'm not sure I heard you talk about this. Last quarter, I think you were indicating there was some intrapatient dose escalation that was going on, you know, past progression. Just wondering if you could talk directionally. Are you seeing that pick up? Is it the same?
Great. Thank you.
And thank you and our next question comes from Jessica Fye from Jpmorgan. Your line is now open.
Hey, guys. Good evening, Thanks for taking my question.
Couple from me.
Where do you estimate your penetration rate stands in Portland, just at this point.
<unk>.
Separately can you talk about the next steps following the top line results for entry. So how soon could you file.
Daniel C. Martin: Is there any sort of dynamic to that, especially since, you know, you had that data at ASCO? It was published, I think, in July.
Sure.
And I appreciate those earlier kind of comments about that.
And reaching more community physicians, but how much additional SG&A if any do you envision what would be needed to support a second line launch.
Christopher Joseph Raymond: And then maybe just sort of another sort of broader question.
Christopher Joseph Raymond: I guess, and I get this question, this is probably the most asked question I hear from investors, is just thinking about how quickly Kim Locke became standard of care and fourth line gist.
Steve Jess Thanks, Thanks for the question, but let's try and work our way through <unk> and churn. So I think I'll take the.
Over the last two here and then I'll turn it over to Dan to talk a little bit about what we're seeing in the market in terms of penetration, how we view that but with respect to the topline once we report out the intrigue results in our next step of course would be to prepare our filing both in the U S as well as in Europe.
Christopher Joseph Raymond: you know, really maxing out the opportunity in three quarters.
Christopher Joseph Raymond: How should we be thinking about, you know, the dynamic in the second line setting? Obviously, it's a different, you know, sort of dynamic given that there's an established option in the second line, but just kind of talk about it.
And our.
Our goal would be to of course get those filings in over the course of the subsequent months and I think probably looking back to the timeline that we experienced with Invictus for the initial fourth line filing is probably a good proxy to use with respect to the U S filing and we would of course hope to.
Christopher Joseph Raymond: The sort of velocity of
Christopher Joseph Raymond: of penetration between fourth and second that you might be anticipating, assuming obviously positive data this quarter. Hey, Chris, and Steve.
The European filing shortly thereafter with respect to SG&A and what you expect in terms of additional investment for a second line launch we don't expect at all and don't plan to increase the size of our footprint from a commercial or medical affairs perspective, we're right sized for the opportunity already in there.
Steven L. Hoerter: Hey, Chris, it's T. So let me take the first part of that, and then I'll turn it over to Dan to address the other part of your question. So you reference the IPDE data from both in Victus, our randomized phase three study, the fourth month study, as well as from phase one. And we were really pleased to see both of those data published in the peer-reviewed literature as manuscripts over the course of the summer months.
As Dan has noted we're already calling on the physicians in the community who treat patients with just you would see both fourth line patients as well as second line patients. So we wouldn't expect to see any increase in terms of head count of course will be the additional investment in terms of.
Steven L. Hoerter: And as you know from the data and certainly the feedback that we've heard from thought leaders, they view the PFS2 data that we generated upon dose escalation as being very meaningful clinically for patients, especially when you look at the data as a fraction of the benefit that patients received as measured by PFS1. So we're really encouraged by the data. As you might remember, in the phase one study, the dose escalation part of the study, we didn't actually reach a maximum tolerated dose of repretinib.
Marketing and promotional dollars. So as we start that launch process in the second line post data from intrigue.
Andy will cover off on the penetration question.
Sure absolutely thanks, Jess for the question.
So we continue all signs continue to point to being very highly penetrated within that fourth line opportunity, we do any number of surveys.
I've mentioned before that the data to derive a shares and perfect in the space.
So we leverage any number of surveys physician surveys, but we also will go out and do what are called chart audit survey as well, we're actually have positions pull their charts and show us who's getting what and the fourth line setting and by all accounts it continues to be.
Steven L. Hoerter: And we dose patients up to 400 milligrams daily. So we feel as if we have ample headroom for dose escalation, and I think that's now evidenced by the data from Invictus and from phase one.
They're very highly penetrated clearly viewed as the standard of care in fourth line and <unk>.
Steven L. Hoerter: And certainly, even at that higher dose, the drug remains well tolerated, so we're encouraged by the data and that underscores the efficacy of the product ingest. Dan, do you want to address the rest of Chris's question with respect to what you're seeing in the actual market in terms of utilization of IPDE? Sure, absolutely.
One physician, even told US lately recently excuse me that he would use it as a.
Must use a must use agent in the fourth line setting.
Okay. Thanks can I just add a couple follow ups.
Comment on the proportion of your patients who are on free drug right now it seems like it's running a little high this quarter and you talked about the same.
Daniel C. Martin: Thanks Chris for the questions. So on the IPDE front, you know, as Steve said, the data has been really well received by the KOLs, in particular, who view this as a really meaningful benefit for patients. And so there's certainly been interest there. The challenge, though, is that, of course, this is an off-label dose, so we're not able to promote that. We only, of course, promote consistent with our labeled dose. And also, you know, what we see in the marketplace is a relatively consistent use, which is a smaller portion of our overall dosing; the vast majority of doses are at the labeled dose.
In truth for fourth quarter.
Should we expect that dynamic to persist through 2022 or to come back down to the range that you've talked about that 20% to 30% range and then one R&D question. How long do you project it will take to enroll that motion trial.
Thanks for the questions just Andrew do you want to take just the first question about percentage and persistency is of that and then Matt if you'd like to take the motion question.
Yeah, absolutely. Thank you.
Good question, Jeff. Thanks, So as we mentioned on the.
Q2 earnings call, we did expect that path would.
Daniel C. Martin: And a couple thoughts on this, you know, from a payer perspective, what we see is sort of inconsistent. We see some claims are approved for the IPDE dose, and others are not. And, you know, it has not been added to the NCC, and guidelines thus far remain to be seen if and when that will happen.
Continue to be at or perhaps slightly above the top end of our 20% to 30% range in Q3, and then likely in Q4 as well and the reason for that.
Is the way the Medicare part D drug benefit our drug program works is that if a patient goes on free drug free drug program. They need to remain on free drug through the balance of the calendar year. So there is that I don't know if seasonality is the best term for it but there is that dynamic to the program.
Daniel C. Martin: If it is, and if we think that could provide some momentum with respect to not only demand for the use of that dosing regimen but also the access side of the equation. So, you know, we'll just have to see how that plays out, but thus far, it's been pretty consistent as a relatively small overall portion of our dosing. With respect to your second question about uptake in the second line, yeah, we've been incredibly pleased with the rapid uptake that we've seen in the fourth line.
Once you're into Q3.
Have a sense for where you are likely to wind up.
As you round out the year. So that's why we've been able to provide the guidance that we have.
And it's played out pretty much exactly as we anticipated thus far.
Going forward, though.
It does as we've said all along it.
Daniel C. Martin: And we just continue to see, as I underlined in the prepared remarks, just tremendous support and belief in Kinlock and, you know, really high scores across the board, not just by users but even more broadly as we've made more and more progress in reaching the community settings. So really pleased with the progress thus far, and we think it bodes extremely well for our planned second line launch. As I mentioned, we've reached an additional 3,000 physicians who are likely to be treating earlier line patients beyond the 530 or so that have prescribed it to date.
It does we do expect it to vary somewhat quarter to quarter. These are that along with gross to net or things that can vary quarter to quarter, we think that overall, our 20% to 30% estimated range is still.
Very much the guidance that we would give over the whole of the year.
Hi, Jeff This is Matt so in regards to your question about the motion study, we're very excited about the <unk> data that we recently presented at ESMO showing a combined 47% response for the <unk>.
Cohorts in both the escalation and the expansion phase.
Clearly the 120 patient motion study will be a randomized study.
Daniel C. Martin: And we reached, of course, we only message our fourth line indication to those physicians to be clear, because you never know where our fourth line patient is going to appear. But the awareness that we've developed in that broader set of potential future prescribers, we think sets us up extremely well. And as I mentioned in my prepared remarks, the market research that we're seeing now suggests, just based on general experience and perceptions of the two drugs, that actually many just treaters rate Kinlock significantly higher than students.
In about 40 countries.
Just as a benchmark we were able to enroll about 40 patients in approximately six months and the.
Part one of the core.
Please go into study so really excited about the interest from the investigators the high response rates.
These are multiple countries around the world, we expect that this enrollment should be very good enrollment rates.
Thank you.
Yes.
Okay.
And thank you.
And our next question comes from Michael Schmidt from Guggenheim. Your line is now open.
Hi, This is Paul on for Michael Thanks for taking our questions.
Just a couple on entry from US ahead of the readout.
Maybe your current thoughts on the expected genetic breakdown of second line patients in the study in terms of primary or secondary kit mutations.
Daniel C. Martin: So, for all of these reasons, we think that we're really well set up for second line, and we think a relatively rapid uptake is certainly possible. The only other things I'll mention that will be things we work through, of course, is that, as you mentioned, there is an established therapy. And we think that, you know, we'll need to continue to reach and continue to impact the community more and more because we think that earlier line setting will be that much more the domain of community physicians.
Then as a follow on any additional color on how you view. The exon 13 14 population in terms of taking share in central performance of quite a lot of precedent would be really helpful. Thank you.
Great Steve. Thanks, Thanks for the question with respect to genetic profile and just in what we would expect to see in the second line population.
I'll ask Matt to kind of follow up on this but what we would expect to see in the second line population when the intrigue studies and shrink as a 450 patient study. So we would expect the patient population to be very representative of what a second line patient population would look like generally and as reported in the literature and so in terms of primary mutations we would expect.
Daniel C. Martin: So those are things that we will be very focused on driving at launch, but we think, for all the reasons listed, we've got a great opportunity for rapid penetration into the second line pending data from Intrigue.
See about 70% of patients with kit exon 11 may.
Jessica Fye: And thank you. And our next question comes from Jessica Fy from J.P. Morgan. Your line is now open.
Maybe up to 15% of patients with a kit exon nine.
And then you would expect to see 5% to 6% of PDGF, our alpha mutated patients and then the balance would be wild type patients. So that's generally when you look at the literature references what you what you see in the literature in terms of expectations for a population and just in terms of distribution of primary mutations Matt is there anything else you would add.
Jessica Fye: Hey guys, good evening, thanks for taking my questions. A couple from me: where do you estimate your penetration rate stands in fourth line just at this point? Separately, can you talk about the next steps following the top line results for Intrigue? So, how soon could you file?
Add to that in terms of secondary mutations.
Yes, I think we would just also highlight the recent publication we had on the Invictus. Some phase three quick one study that was published in clinical cancer research just back in.
Steven L. Hoerter: And appreciate those earlier comments about reaching more community positions, but how much additional SG&A, if any, do you anticipate would be needed to support a second line launch? Great, it's Steve, Jess. Thanks for the questions. Let's try and work our way through these in terms. I think that I'll take the last two here, and then I'll turn it over to Dan to talk a little bit about what we're seeing in the market in terms of penetration and how we view that.
September.
Highlights is the distribution of both primary and secondary mutations in the fourth line setting and really there is a quite extensive mutational heterogeneity.
The $4 70, and Thats also been seen in the phase one study we get an earlier.
Look at some of the second third fourth line patients also sharing many of these patients harbor up to five mutations so interest.
To note there.
Broad spectrum agents with just kinloch will be necessary to recover this broad spectrum.
Mutational burden that is.
Patients Harbor.
Great. Thank you.
And thank you.
And our next question comes from young gang from Jefferies. Your line is now open.
Steven L. Hoerter: But with respect to the top line, once we report out the intrigue results, our next step, of course, would be to prepare a filing both in the U.S. as well as in Europe. And, you know, our goal would be, of course, to get those filings in over the course of the subsequent months. And I think looking back to the timeline that we experienced with Invictus for the initial fourth line filing is probably a good proxy to use with respect to the U.S. filing.
Thank you.
So Steve in your prepared remark you.
You said.
Thank you Sidney good data and made this corner.
So should we assume that the data is going to be in December.
Yes, hi, good afternoon. Thanks, Thanks for joining the call so with respect to our guidance on intrigue topline results. While we've said very consistently is quarter. Four so we have not refine to that guidance to be any specific time within Q4, we just said quarter four this year.
So what you may have heard me say it was later this quarter.
Steven L. Hoerter: And we would, of course, hope to make the European filing shortly thereafter. With respect to SGNA and what to expect in terms of additional investment for a second line launch, we don't expect at all and don't plan to increase the size of our footprint from a commercial or medical affairs perspective. We are the right size for the opportunity already, and as Dan has noted, we're already calling on physicians in the community who treat patients with Jess, who would see both fourth-line patients as well as second-line patients. So we wouldn't expect to see any increase in terms of headcount.
Given the already in Q4.
Okay. Thank you and then.
In the study in terms of a tumor imaging scan.
CNA trades of phases, three imaging scans every six week cycle for the first six months cycle than every other cycle later.
The cycle.
<unk>.
Pfizer is a second phase three trial I think a scan was done on day 28.
Or 10 month cycle.
Could there be some more frequently so.
Want to ask you.
Steven L. Hoerter: Of course, there'll be an additional investment in terms of marketing and promotional dollars as we start that launch process in the second line post data from intrigue. Dan, do you want to cover off on the penetration question? Sure, absolutely.
Sure the retro now for your checking every six weeks.
Cyclists scanning.
In your trial aside from patient convenience.
Okay. Thanks for the question, Yeah, just give us a satisfying timeshare and then do you think that every six week cycle reverses.
I have a 28 day cycle potentially.
Potentially impact PFS. Thank you kind of think correction.
Daniel C. Martin: Thanks Jess for the question. So we, you know, continue to see all the signs that point to being very highly penetrated within the fourth line opportunity. We do any number of surveys. You know, I've mentioned before that the data to derive a share is imperfect in the space.
No Thats alright, and thanks, Thanks for completing the thought and the question Matt would you like to take that.
Sure Steven.
And so yes, you are right in the.
Intrigue phase III studies, what we have is the <unk>.
<unk> cycle of every other cycle with a six week cycle and that's related to the dosing of Sunitinib that patients are being administered so it doesn't.
Daniel C. Martin: So we leverage any number of surveys, physician surveys. But we also will go out and do what are called chart audit surveys. And we'll actually have physicians' polar charts.
Four weeks of drug and then the choice of rest period and that constitutes one cycle. So it's very typical for companies to to use that type of cycle.
For a follow up scans for patients.
Daniel C. Martin: and show us, you know, who's getting what in the fourth line setting. And by all accounts, you know, it continues to be very highly penetrated, clearly viewed as the standard of care in fourth line. And one physician even told us recently, recently, excuse me, that, you know, he views it as a quote, "must use" agent in the fourth line system.
Most importantly is that the same for both arms of the study, even though recruitment is a continuous dosing.
The interval for skin consumer close the two arms of the study and that prevents any bias in terms of the.
Time too.
Such as the progression free survival.
But if I remember, maybe I am maybe im mistaken, but I thought the size of the trial and <unk> phase three trial for certain.
To my imaging was done on day 28.
Daniel C. Martin: Okay, thanks. Can I just add a couple follow-ups? The comment on the proportion of your patients who are on free drugs right now seems like it's running a little high this quarter, and you talked about the same being true for the fourth quarter. Should we expect that dynamic to persist through 2022 or to come back down to the range that you've talked about, that 20 to 30% range? And then one R&D question: how long do you project it will take to enroll the motion in the trial?
Tim on cycles.
There are many times what it takes for me as well.
Uh huh.
Yes, Dan I don't know we'd have to go back and look at their critical design or look at the FDA documents.
Their actual schedule, but it's for us it's probably more importance is recognized.
Every.
Every six weeks is a very frequent interval for measuring tumor progression fragmenting standards of living standard protocols, which is a four week cycle measure every other cycle. So thats an every eight week basis. So every time, we think it can vary.
Pretty reasonable or aggressive interval to measure.
Jessica Fye: Thanks for the questions, Jess. Do you want to take Jess's first question about Pat Persimidge and the persistency of that? And then Matt, if you'd like to take the motion question, Yeah, absolutely. Thank you.
First the six cycles.
Okay. Thank you. Thank you for the clarification and the last quick question on <unk>.
<unk> himself Nick so.
The FHFA motion trial enrolled.
Enrolling patients who are not amenable to surgery. So can you actually.
Quantify what percent of the fees paid for them over patients are not a matter of a dispensary in general Thank you.
Daniel C. Martin: So, good question, Jeff, thanks. As we mentioned on the Q2 earnings call, we did expect that PAP would continue to be at or perhaps slightly above the top end of our 20 to 30% range in Q3 and then likely in Q4 as well. And the reason for that is the way the Medicare Part D drug benefit or drug program works is that if a patient goes on the free drug program, they need to remain on free drugs through the balance of the calendar year.
So high units Steve. Thanks for the question so at ESMO Investor event. Once we after we presented the data at ESMO from the Phase one two study with some sell today that Matt referenced this earlier during the Q&A and also in the prepared remarks, we were really pleased to see the high 40, 47% response rate you saw on that and that.
Patient population across the phase, one and phase II portions of the study so really encouraging activity that we saw.
Dan Martin also spent some time talking a little bit about what we see today in the market in terms of how these patients are being treated.
Daniel C. Martin: So there is that, I don't know if seasonality is the best term for it, but there is that dynamic to the program that, you know, once you're in Q3, you have a sense for where you're likely to wind up, you know, as you round out the year. So that's why we've been able to provide the guidance that we have, and it's played out pretty much exactly as, you know, we anticipated thus far.
<unk> talked a little bit about patient journey and how these patients who are not amenable to surgery.
Through so maybe I'll ask Dan to comment on that in just a second but before I do I think the one point that I would make and I think that Matt mentioned this in his prepared remarks is surprisingly in <unk>. Despite having an approved treatment for these patients picks of darden.
Daniel C. Martin: Going forward though, as we've said all along, it does, we do expect it to vary somewhat quarter to quarter. These, along with Gross-Sinette, are things that can vary quarter to quarter. We think that overall, our 20 to 30% estimated range is still very much the guidance that we would give, you know, over the whole.
That drug yet when we look at it claims analysis in the U S actually isn't the market share leader that's not the standard treatment. That's used for these patients it's actually a net net gleevec. Despite the fact that in that and that was not approved for this use and the data to support its use actually shows a very low response rate in these.
So we think that speaks to the unmet medical need.
Matthew L. Sherman: Hi Jess, yeah, this is Matt. So in regards to your question about the motion study, we're very excited about the phase one-two data that we recently presented at ESMO, showing a combined 47% response rate across all cohorts in both the escalation and the cohort A expansion phase. And without planning the 120 patient motion study, it would have been a randomized study in about 40 countries. Just as a benchmark, we were able to enroll about 40 patients in approximately six months.
<unk> and I think that was really reinforced by the FDA granting <unk> fast track designation. So we were pleased to announce that as well today.
Dan would you like to comment just on patient journey.
Sure absolutely. Thank you and thanks for the question.
So what we will review that ethanol was a lot of work that we've done not only with Kols, but also as Steve mentioned with a lot of use claims work to really try to understand the.
Patient journey and also to try to size the both the incident and prevalent.
Populations that we think are.
Matthew L. Sherman: in Part 1 of the, or Core A of the phase 1-2 study. So really excited about, you know, the interest from the investigators with the high response rate and now opening this up in multiple countries around the world. You know, we expect that this enrollment should be very good. Thank you. And thank you. And our next question comes from Michael Smith, from Guggenheim. Your line is now open.
<unk> likely to be eligible.
For our drugs upon launch and so on.
What we laid out was that we think there are about 14 to 18000.
Patients who are diagnosed annually in the U S with <unk> now that's both localized and diffuse and as you mentioned it is true that diffuse patients tend to have a higher recurrence rate and localized but there are a lot more localized patients and so both contribute to a population that would be.
Current after surgery, we think there is somewhere in the order of 2000 2400 a year.
Who would recur after their first surgery now some of those patients may go on to get additional surgeries.
Paul Jeng: Hi, this is Paul on behalf of Michael. Thanks for taking our questions. Just a couple of questions on intrigue from us ahead of the readout. First, maybe your current thoughts on the expected genetics.
<unk> received some benefit but ultimately it is this population as they progressed where.
Systemic therapy becomes a focus systemic therapy delivered by medical oncologists and so we've estimated that the incident Rx treated population.
Paul Jeng: Breakdown of second-line patients in the study in terms of primary or secondary
Paul Jeng: in terms of primary or secondary kit mutations. And then, as a follow-on, any additional color on how you view the Exxon 13, 14 population, in terms of patient share and potential performance of Klinlock for students, would be really helpful. Great, I call it Steve.
Within the U S. It's about 13% to 1400 patients annually.
And then given that this is a non lethal disease.
Believe that there is a meaningful prevalent population.
And we estimate that to be about 8000.
Patients.
8000 patients with it.
Around the time that we would be launching and that consists of patients who are on <unk>.
Therapy currently and those who.
Steven L. Hoerter: Thanks, thanks for the question with respect to the genetic profile in GIST and what we'd expect to see in the second line population. I'll ask Matt to kind of follow up on this, but what we'd expect to see in the second line population in the intrigue studies, you know, intrigue is a 450 patient study, so we would expect the patient population to be very representative of what a second line patient population would look like generally and as reported in the literature.
We're recently on in the prior several years, so that's kind of a summary of how that how it.
<unk>.
And a little bit about the.
We think the market opportunity size wise and as Steve mentioned, while picks at Heartland is really important.
<unk> from sort of a regulatory and development point of view.
It really has struggled with uptake and we think about.
A lot of patients out there actually receive imatinib and other T guys because of the issues there.
Pixar profile.
<unk>.
Steven L. Hoerter: And so in terms of primary mutations, we would expect to see about seven, 70% of patients with a kit Exxon 11, maybe up to 15% of patients with a kit Exxon 9. And then you'd expect to see 5% to 6% of PDJFR alpha mutated patients, and then the balance would be wild-type patients. So that's generally when you look at the literature references, what you see in the literature in terms of expectations for a population just in terms of the distribution of primary mutations. Matt, is there anything else you would add to that in terms of secondary mutations? Organization?
So in your trial when you say patients two one not.
Then I'd like a surgery, that's not a really firsthand.
Timer.
Heart surgery or is that the patients are where the cells are there previously and relapsed. So that they are not eligible for sunshine anymore.
So it could be see if it could be either right. So it could be patients who present with a tumor and based on tumor location.
Or based on other.
Maybe a medical history of the patient the patients not eligible for a surgical intervention and so therefore, they become eligible for systemic treatment or it could be patients that have had a lengthy journey with the disease and have undergone multiple surgeries Susan become eligible and we've shared previously some vignettes from the phase one experience and we have.
Both of those types of patients in fact in the phase one two study.
Theres a vignette is at the moment, who was diagnosed some years ago that had undergone multiple multiple surgeries I think including a total joint replacement and then we had another patient who is newly diagnosed non amenable to surgery.
Matthew L. Sherman: Yeah, I think we just also highlight the recent publication we had on the Invictus Phase 3, Fourth Line study that was published in clinical cancer research just back in September. And what that highlights is the distribution of both primary and secondary mutations in the fourth line study. And really, there's quite extensive mutational heterogeneity in the Fourth Line setting, and that's also been seen in the Phase 1 study when we had an earlier look at some of the second-line, third-line, fourth-line patients, also showing that many of these Patients harbor up to five unique mutations. So it's interesting to note that, you know, broad-spectrum agents such as Kimlock will be necessary to really cover this broad spectrum of mutational burden that these patients harbor.
So that's the spectrum.
Okay. Thank you very much.
Yeah.
Yeah.
And thank you and our next question comes from Ren Benjamin from JMP Securities. Your line is now open.
Hey, good afternoon, guys. Thanks for taking the questions.
Just to piggyback off of just asked regarding next steps for the intrigue study I guess.
After the data is reported I'm pretty confident of the next steps at that point, but kind of between now and call. It the end of the year can.
Can you just kind of take us through.
I guess, how youre getting the data is this something thats coming in daily or weekly do you just wait for an email from the DSM V that says Hey, this is what the results are how long.
Eun Kyung Yang: And our next question comes from Yun Yang, from Jeffries. Your line is now over.
Database cleanup cleanup might be just any sort of color.
Steven L. Hoerter: Thank you. So, Steve, in your prepared remark, you said phage-3 intrigue data late this quarter.
In regards to that.
Yes, Steve Thanks for the question. So let me try and answer that in general terms, so with any study of this nature.
Eun Kyung Yang: Yeah, Ian, good afternoon. Thanks for joining the call. So with respect to our guidance on intrigued topline results, what we've said very consistently is quarter four. So we have not refined that guidance to be any specific time within Q4. We've just said quarter four of this year.
Time to event endpoints of course, the sponsor needs to wait for the number of events to accumulate in the study before proceeding with the data cleaning and then being able to lock the database and do the statistical analysis, and then report out the top line and the timelines associated with each of those steps.
Steven L. Hoerter: So what you may have heard me say was later this quarter, given that we're already in Q4. Okay, thank you. And then in the study, in terms of a tumor imaging scan, so in Intrigo phase three, imaging scans are done every six-week cycle for the first six cycles, then every other cycle later, every other cycle. In Pfizer's phase three trial, I think the scan was done on day 8, 28 of all treatment cycles, and could be done more frequently. So just want to ask you the rationale for you choosing every six-week cycle scanning in your trial aside from patient convenience. Thank you for the question. Yeah, sorry for the interruption.
Of course can vary just based on complexity of the study number of subjects in the study and the like so there is.
Those are the key steps that are taken before any sponsor would be prepared to report out top line results.
Okay and just.
I don't know when's the last time.
Is get the data, but I guess base based on the last time, you feel very confident that this can't slip into the first quarter or second quarter, just because of a delay of events you feel you feel pretty confident about the fourth quarter.
Hum bookends that you've created.
Yes. Thanks for the question Ryan that's exactly why we reiterated today our guidance of reporting out topline results for intrigue in Q4 of this year.
Eun Kyung Yang: And then do you think that every six-week cycle versus every 28-day cycle would potentially impact PFS? Thank you. Sort of for interruption. No, that's all right, Ian. Thanks for completing the thought and the question. Matt, would you like to take that? Sure, Steven. Hi you.
Got it.
And then just switching gears to the EU preparedness and the launch activities I know we've talked about this in the in the past, but can you just.
Remind us kind of what those are the key EU markets that you're targeting and as we think about.
Matthew L. Sherman: And so, yes, you're right, in the Entree Phase 3 study, what we have is a scanning cycle of every other cycle with a six-week cycle. And that's related to the dose of pseudinibnib that patients are being administered. So the Sudinididid dose is 12, medicine, and a two-week rest period, and that constitutes one cycle.
The EU launch should we be using maybe the U S ramp in fourth line as a good proxy or should we be looking more at the rest of the world revenues as you know it was kind of more of a proxy.
Yes. Thanks for the question, Brian So let me, let me try and address each of those components. So for US our focus is on the five largest markets in Europe. So by five largest I'm, including the U K. Despite the fact that the U K of course is no longer part of the European Union, but those are the five markets principally that we would be targeting with our team as.
Matthew L. Sherman: So it's very typical for companies to use that type of cycle for follow-up scans for a patient. But what's probably most important is that it's the same for both arms of the study, even though reprintedinidinidin is a continuous dosing drug. You know, the interval for scanning would be the same across the two arms of the study. And that prevents any bias in terms of the time to move in such as a progression-free survival event.
We've spoken about previously our goal always has been to put in place a nimble focused team in Europe to address the fourth line launch in that territory, and we would expect to see that launch.
Cascade over time across markets from early launch markets to later launch markets and what really drives the timing is achieving market access so in some markets like Germany, we're able to price freely. So that allows us to launch very quickly and in other markets. If you think about southern European markets as an example, Italy and Spain.
Matthew L. Sherman: But if I remember correctly, maybe I'm mistaken, but I thought that Pfizer's trial, in Fisor's A3T trial for Surton, tumor imaging was done on day 28, of all trim and cycle, does diminish every six weeks as well because it tweaks off. Yeah, that I don't know.
Eun Kyung Yang: We have to go back and look at the protocol design or look at the FDA documents about their actual schedule. But it's, you know, for our state, it's probably more important to recognize that it's pretty, every six weeks is a very frequent interval for measuring tumor progression. In fact, many standards, like many standard protocols, if the four-week cycle measures every other cycle, so that's on an every eight-week basis.
The pricing and reimbursement negotiations can take longer and so that those launches would occur.
Later period of time once we achieve market access in those territories and so the way we think about our build is in a very efficient way our organizational build is in a very efficient way to ensure that we're only adding the human resources that we need at the time, when we expect to get market access and a key territory now with respect to uptake.
It's a great question and I think touching on it I think it was the question that Chris May have asked earlier one of the reasons that we think that we've seen such rapid uptake of <unk> in the fourth line setting in the U S is based on the strength of the data. So as you know we reported long term follow up recently at ESMO, which showed with longer.
Eun Kyung Yang: So every six weeks is a very, you know, pretty, you know, reasonable or aggressive interval to measure for those first six cycles. Okay, thank you. Thank you for the clarification. And the last question is on himself, Nip.
Eun Kyung Yang: So in the phagery motion trial, you are enrolling patients who are not amenable to surgery. So can you actually quantify what percent of diffused forms of a patient are not amenable to surgery in general? Thank you.
Term follow up an overall survival benefit and Ken lock on that 18 months versus about six months in the placebo arm. So I need a tripling in the overall survival benefit for patients. So I think the strength of the data certainly helps us in terms of being a compelling factor for physicians as they think about treatment options for their patients.
Steven L. Hoerter: Hi you and Steve, thanks for the question. So at our ESMO investor event, after we presented the data at ESMO from the Phase 1-2 study with Femselton, and Matt referenced this earlier during the Q&A and also in the prepared remarks. We were really pleased to see the high 47% response rate we saw in that patient population across the phase 1 and phase 2 portions of the study, so really encouraging activity that we saw.
And as we know in the fourth line setting there are no good options aside from Ken locked for these patients and so when you combine the unmet need with the strength of the data. We think that's a key factor or key set of factors thats driving rapid uptake of the drug in that setting. So in Europe, I think it's premature for us to comment on what we might see.
See in in European markets, I think each market will be slightly different.
So as we get into the markets will be in a better position to talk about what we're seeing what we see in terms of rapidity of uptake and how physicians are viewing the drivers they get hands on experience with it.
Steven L. Hoerter: Dan, Martin also spent some time talking a little bit about what we see today in the market in terms of how these patients are being treated and talked a little bit about the patient journey and how these patients who are not amenable to surgery flow through. So maybe I'll ask Dan to comment on that in just a second.
Great.
I guess one final one for me.
Can you talk.
Is there any thoughts from your end regarding a biomarker strategy.
For the.
The inhibitors of I'll cover the Autophagy.
We're targeting Autophagy inhibition. So there are there is there are tumors selection of a patient selection model, where you can look for enhanced.
Levels of Autophagy that wood.
Steven L. Hoerter: But before I do, I think the one point that I would make, and I think that Matt mentioned this in his prepared remarks, is surprisingly common in TGCT, despite having an approved treatment for these patients, pexidartinid. And that drug, when we look at claims analysis in the U.S., actually isn't the market share leader, and it's not the standard treatment that's used for these patients. It's actually a matnib, Glevec, despite the fact that amatnip is not approved for this use, and the data to support its use actually shows a very low response rate in these patients.
Results in our patient selection for clinical studies.
That's a great question, Ron I mean.
We certainly are evaluating that I think however, pre clinically we certainly haven't seen any indication that there would be a selection strategy that seems to be a fairly.
Widespread.
Sort of Upregulation of Autophagy in solid tumors as well as now in CML based on what's been reported in the literature and I think what's changing for us and what's evolving for US with this program specifically as we're starting to see not only in the data that were generating internally, but also the data in the literature as Matt spoke to in his prepared remarks, we're seeing that this.
This mechanism of escape seems to be a very common when when tumors are treated with targeted therapies. So we reported our own preclinical data looking at Austin Merkin had been fascinated and mutant Egfr lung cancer models at the Triple meeting.
Steven L. Hoerter: So we think that speaks to the unmet medical need in TGCT, and I think that was really reinforced by the FDA granting Vimseltoniv Fast Track designation. So we were pleased to announce that as well today. Dan, would you like to comment just on the patient journey? Sure, absolutely. Thank you and thanks even for the question.
As we referenced in the prepared remarks, there have been other groups that have published now on the literature looking at <unk> mutant non small cell lung cancer, a separate group published on data looking at Autophagy in CML.
And the effect of Imatinib on up regulation of Autophagy. So we're encouraged by what we see as broad confirmation of the mechanism and the role that this places an escape mechanism and both solid and liquid tumors and so for US I think the challenge now is continuing of course to progress with the phase one dose.
Daniel C. Martin: So what we reviewed at ESMO was a lot of work that we've done, not only with KOLs but also, as Steve mentioned, with a lot of U.S. claims work to really try to understand the patient journey and also to try to size the, both the incident and the prevalence, populations that we think are, you know, likely to be eligible for our drugs upon launch. And so what we laid out was that we think there are about 14 to 18,000 patients diagnosed annually in the U.S. with TGCT. Now, that's both localized and diffuse.
Escalation study, but also thinking about what the potential broad applicability tells us in terms of how our clinical program may evolve over time. So we're really encouraged by what we're seeing in and certainly very pleased to be the leader in this space and to have the leading program first into the clinic.
Great. Thanks for taking the questions.
And thank you.
And our next question comes from Robyn <unk> from <unk> security.
Daniel C. Martin: And as you mentioned, it is true that diffuse patients tend to have a higher recurrence rate than localized patients, but there are a lot more localized patients. And so both contribute to a population that would be recurrent after surgery. We think there are somewhere in the order of 2,000 to 2,400 a year who would recur after their first surgery. Now, some of those patients may go on to get additional surgeries and receive some benefit, but ultimately, it's this population, as they progress, where systemic therapy becomes a focus, systemic therapy delivered by medical oncologists. And so we've estimated that the incident RX-treated population within the U.S. is about 13 to 1,400 patients annually.
Line is now open.
Hi, This is Alex unoccupied Robyn thanks for taking the question can.
Can you walk us through any market research that you've done that touches upon how physician used frequent locks in the second line setting would be affected by price.
Students going generic and is there any indication that generic student attacks the bar so to speak quickly mark at all.
Yeah.
So thanks for the question. So we of course and Dan referenced this earlier, we've done quite a bit of market research.
With physicians in the U S to understand their perception of kinlaw relative to suit. Some even just based on the data that we've generated so far in the fourth one and of course from the Phase one study in the second line cohort and as Dan referenced earlier, we are quite encouraged by what we see in terms of physician response, there Dan or Theres, some details that you'd like to offer in terms of.
How we're thinking about <unk> and its profile relative to kinloch.
Sure.
Daniel C. Martin: And then, you know, given that this is a non-lethal disease, we believe that there is a meaningful, prevalent population, and we estimate that to be about 8,000 patients, 8,000 patients around the time that we would be launching. And that consists of patients who are on systemic therapy currently and those who were recently on it in the prior several years. So that's kind of a summary of how it flows and a little bit about what we think the market opportunity is size-wise.
A little bit extra color, Steve mentioned, we have done quite a bit of research. Thus far of course, the outcome of intrigue will be.
A really important part of.
Understanding exactly.
How it will stack up with Sutent in the eyes of Treaters and of course, we will do additional research after we have those results but.
We've done quite a bit of work, thus far and what comes back really consistently is that.
There are concerns with students AE profile and it's a drug that can be hard to give them hard to take for patients and so on.
Steven L. Hoerter: And as Steve mentioned, while Pekidartinidnid is a really important consideration from sort of a regulatory and development point of view, you know, it really has struggled with uptake. And we think about, you know, a lot of patients out there actually receive a matinib and other TKIs because of the issues that Pettin PicsDartNNine profile presents. So in your trial, when you say patients who are not amenable to surgery, is that not a really first timer for surgery, or is it patients who have had surgery previously and are relaxed so that they are not eligible for surgery anymore? So it could be, you know, Steve, it could be either, right?
Physicians, both academic and community of really rooting for kinlaw.
And intrigue and they really want to use it in the second line in fact, we just did some.
Research as I mentioned in my prepared remarks, where we asked positions gist treaters for there.
Basically to rate the product attributes of Kinloch and Sutent side by side and what we saw was that cannot came out on top on an every attribute we tested and by a fair amount in fact.
Nearly all of the attribute scoring was statistically significantly higher FERC Kinloch. So I think what that tells us is that.
Clinicians are really eager to use can lock in the second line and I think that's why there's so much anticipation and I'm looking forward to the intrigue results as it relates to generic.
Steven L. Hoerter: So it could be patients who present with a tumor and based on tumor location or other, maybe medical history of the patient, the patient is not eligible for surgical intervention. And so, therefore, they become eligible for systemic treatment. Or it could be patients that have had a lengthy journey with the disease and have undergone multiple surgeries who then become eligible. And we've shared, you know, previously some vignettes from the phase one experience. And we have both.
We think that at the end of the day, most clinicians make their decisions based on the clinical evidence and so a positive head to head study will put us in great position with treaters.
And we think also with payers, while obviously payers look to.
Different.
Factors value and cost and such at the end of the day the gold standard for demonstrating head to head values, a head to head clinical trial in and that's what we have so we look forward to the readout of intrigue and we believe you know pending positive results will be in a really good position.
Steven L. Hoerter: of those types of patients, in fact, in the phase one-two study. There's a vignette of a woman who was diagnosed some years ago that had undergone multiple surgeries, I think, including a total joint replacement. And then we had another patient who was newly diagnosed but not amenable to surgery.
A successful launch in the second line.
Sounds good thanks, and one more if I can I think we've touched on this before but it's been another quarter and when you interact with doctors what are you seeing with our doctors to use student in the second mine.
And is it hasn't been different from label at all.
Yeah. Thanks for the question, so I thought I'd be happy to take that so we've done quite a lot of work looking at how physicians you sit down and I assume your question really relates to dosing schedule is that correct.
Steven L. Hoerter: And thank you. And our next question comes from Ren Benjamin, from JMP Security. Your line is now open. Hey, good afternoon, guys. Thanks for taking, Just to piggyback off of what just asked, regarding next steps, Steve, for the intrigue study, I guess not after the data is reported, I'm pretty confident of the next steps at that point, but kind of between now and, you know, call at the end of the year, can you just kind of take us through, you know, I guess how you're getting the data, is this something that's coming in daily or weekly, do you just wait for an email from the DSMB that says, you know, hey, this is what the results are, how long database clean-eye cleanup might be, just any sort of color
Yes, exactly yes, yes, so what we see is really a mixed bag. So there isn't any one standard dosing schedule thats use of suits arent. So you see everything from the labeled dose and schedule of 50 milligrams four weeks on two weeks off all the way down to patients who were getting 25 milligrams per day, and we think thats, probably just reflective.
The tolerability challenges that are often seen with sunshine.
Alright, Thanks for taking my question.
Thank you.
And our next question comes from Brad Canino from Stifel. Your line is now open.
Great afternoon, and congrats on the additional approvals for Kim Mark one on intrigue and then one on the pipeline as I've been having my conversations heading into the intrigue data one of the sticking points remains at a high rate of censoring you announced back in early 2020. So.
Reni John Benjamin: Yeah, Ren and Steve, thanks for the question. So, you know, with any study of this nature, that's a time-to-event endpoint. Of course, a sponsor needs to wait for the number of events to accumulate in the study before proceeding with data cleaning and then being able to lock the database and do the statistical analysis and then report out the top line.
Just like to ask what is your level of confidence.
That you have the censoring will not add bias to the PFS measure for either drug arm.
Yeah. Thanks for the question Brian. So so this isn't something that we spend a lot of time thinking about so we announced the addition of patients at the beginning of last year. We're really pleased with the conduct of the study and how the team has navigated intrigue during the pandemic in particular in following regulatory guidance from regulators around.
Reni John Benjamin: And the timelines associated with each of those steps, of course, can vary just based on the complexity of the study, the number of subjects in the study, and the So those are the key steps that are taken before any sponsor would be prepared to report out the top line results.
The world.
We're pleased with how things have been conducted and looking forward to reporting at the topline.
Okay I appreciate that and then on the call you spoke at length about the ORC inhibitor. It sounds like you have pretty grand ambitions for multiple combination therapy trials, so Steve how.
Are you thinking about value creation for shareholders with this asset given that youre already in three phase III programs and spending on those is the orca inhibitor program that would be better to out license and co develop and if so at what stage or do you think you can establish some R&D collaborations for free drug where you're sure day.
Steven L. Hoerter: Okay, and just, you know, I don't know when the last time you guys got the data, but based on the last time, you feel very confident that this can't slip, you know, into the first quarter or second quarter just because of a delay in events. You feel pretty confident about this fourth quarter, you know, bookends.
Ada, but retain the cost and the value for the asset. Thanks.
Yes. Thanks for the question, Brian So as we mentioned in the prepared remarks, we're really excited about the old program and the potential broad applicability and Matt spoke to this in some detail based on the data we reported at the Triple meeting and of course, what's been reported in the literature and so we do believe that the program has the potential to have very broad applicability in a range of solid and liquid tumors.
Reni John Benjamin: Yeah, thanks for the question, Ren. That's exactly why we reiterated today our guidance of reporting out top-line results for Intrigue in Q4 of this year.
Potentially in combination with a variety of different targeted agents. So we're looking forward to continuing to follow the science here and to prioritize where we want to take the <unk> inhibitor in combination with other agents and you'll be hearing more from us I'm sure in the coming months in terms of how we might decide to prosecute that but with respect to <unk>.
Steven L. Hoerter: Got it. And then just switching gears to EU preparedness and launch activities. I know we've talked about this in the past, but can you just, you know, remind us kind of what those are, the key EU markets that you're targeting? And as we think about, you know, kind of the EU launch, should we be using maybe the U.S. ramp and fourth line as a good proxy, or should we be kind of looking more at the rest of the world's revenues as kind of more of a proxy? A proxy server.
Entering specifically it would just be premature for me to comment on that but we're excited about the program and the opportunity to build long term value.
Steven L. Hoerter: Yeah, thanks for the question, Ren. So, let me try and address each of those components. So for us, our focus is on the five largest markets in Europe. So by the five largest, I'm including the UK, despite the fact that the UK, of course, is no longer part of the European Union.
Okay. Thank you.
And thank you.
And I am showing no further questions I would now like to turn the call back over to Steve <unk> for closing remarks.
Alright. Thank you very much thanks, everyone for joining us on today's call and thank you for your continued support and we look forward to keeping you updated on our continued progress and I Hope you all have a great evening.
Steven L. Hoerter: But those are the five markets, principally, that we would be targeting with our team. As we've spoken about previously, our goal has always been to put in place a nimble focus team in Europe to address the fourth line launch in that territory. We would expect to see that launch cascade over time across markets from early launch markets to later launch markets, and what really drives the timing is achieving market access. So in some markets, like Germany, we're able to set prices freely.
Yeah.
This concludes today's conference call. Thank you for participating you may now disconnect.
[music].
Steven L. Hoerter: So that allows us to launch very quickly, and in other markets, if you think about southern European markets, as an example, Italy and Spain, the pricing and reimbursement negotiations can take longer. And so those launches would occur at some later period in time once we achieve market access in those territories. And so the way that we think about our build is in a very efficient way; our organizational build is in a very efficient way to ensure that we're only adding the human resources that we need at the time when we expect to get market access in a key territory. Now, with respect to uptake, it's a great question. And I think, you know, touching on, I think it was a question that Chris may have asked earlier.
Steven L. Hoerter: You know, one of the reasons that we think that we've seen such rapid uptake of repretin and Kinlock in the fourth line setting in the U.S. is based on the strength of the data. So, as you know, we recently reported long-term follow-up recently at ESMO, which showed with longer-term follow-up, an overall survival benefit in the Kenlock arm of 18 months versus about six months in the placebo arm. So you're tripling the overall survival benefit for patients.
Steven L. Hoerter: So I think the strength of the data certainly helps us in terms of being a compelling factor for physicians as they think about treatment options for their patients. And as we know, in the fourth-line setting, there are no good options aside from Kinlock for these patients.
Steven L. Hoerter: So when you combine the need met with the strength of the data, we think that's a key factor or a key set of factors that's driving rapid uptake of the drug in that setting. So in Europe, I think it's premature for us to comment on what we might see in European markets. I think each market will be slightly different. So as a very important, so as a very mature, we get into the markets, we'll be in a better position to talk about what we're seeing, what we see in terms of rapidity of uptake and how physicians are viewing the drug as they get hands-on experience with it.
[music].
Reni John Benjamin: Great. And here's, I guess, one final one for me. Can you talk, you know, are there any thoughts from your end regarding a biomarker strategy for the inhibitors of ALC or the autophagy inhibitors targeting autophagy inhibition? So is there, is there a tumor selection or a patient selection model where you can look for enhanced levels of autophagy that would result in a patient selection for clinical selection? Studies.
Steven L. Hoerter: That's a great question, Ron. I mean, we certainly are evaluating that. I think, however, preclinically, we certainly haven't seen any indication that there would be a selection strategy that seems to be a fairly widespread, you know, sort of upregulation of autophagy in solid tumors as well as now in CML based on what's been reported in the literature. And I think what's changing for us and what's evolving for us with this program specifically is that we're starting to see not only in the data that we're generating internally but also in the literature, as Matt spoke to in his prepared remarks, that this mechanism of escape seems to be very common when tumors are treated with targeted therapies.
Steven L. Hoerter: So we reported our own preclinical data looking at osmurtinib and fatnib and mutant EGFR lung cancer models at the triple meeting. As we referenced in the prepared remarks, there have been other groups that have published now in the literature looking at LKB1 mutant osmulsel in lung cancer; a separate group published data looking at autophagy in CML and the effect of a matlip on upregulation So we're encouraged by what we see as broad confirmation of the mechanism and the role that this plays as an escape mechanism in both solid and liquid tumors.
Steven L. Hoerter: And so for us, I think the challenge now is continuing, of course, to progress with the phase one dose of salilation study, but also thinking about what this potential broad applicability tells us in terms of how our clinical program may evolve over time. So we're really encouraged by what we're seeing and certainly very pleased to be the leader in this space and to have the leading program first into the clinic. Thanks for taking the time to answer the question.
Robin Karnascus: And thank you. And our next question comes from Robin Karnascus, from Chilist Security.
Alex Sinagos: Hi, this is Alex Sinagos, Robin. Thanks for taking the question. Can you walk us through any market research that you've done that touches upon how physicians used for Quinlock in the second line setting would be affected by price and a student going generic, and is there any indication that a generic student affects the bar, so to speak, for Claymock at all?
Steven L. Hoerter: So we, of course, and Dan referenced this earlier, we've done quite a bit of market research with physicians in the U.S. to understand their perception of Kinlock relative to Sutton, even just based on the data that we've generated so far on the fourth one and, of course, from the phase one study in the second line cohort. And as Dan referenced earlier, we're quite encouraged by what we see in terms of physician response there. Dan, there are some details that you'd like to offer in terms of how we're thinking about Sutent and its profile relative to Kinloch. Sure, just a little bit of extra color.
Daniel C. Martin: As Steve mentioned, we have done quite a bit of research thus far. Of course, the outcome of the intrigue will be, you know, a really important part of understanding exactly how it will stack up with Sutton in the eyes of treaters. And, of course, we'll do additional research after we have those results, but we've done quite a bit of work thus far. And what comes back really consistently is that, you know, there are concerns with students' A.E. profile, and it's a drug that can be hard to give and hard to take for patients.
Daniel C. Martin: And so physicians, both academic and community, are really rooting for Kinlock and intrigue, and they really want to use it in the second line. In fact, we just did some research, as I mentioned in my prepared remarks, where we asked physicians, just therapists, you know, for their, basically to rate the product attributes of Kinlock and Sutton side by side. And what we saw was that Kinlock came out on top on every attribute we tested, and by a fair amount. In fact, nearly all of the attribute scoring was statistically significantly higher for Kinlock.
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Daniel C. Martin: So I think what that tells us is that, you know, clinicians are really eager to use Kinlock in the second line, and, you know, I think that's why there's so much anticipation and looking forward to the intrigue results. As it relates to generic suitant, we think that, at the end of the day, most clinicians make their decisions based on the clinical evidence. And so a positive head-to-head study will put us in a great position with treaters.
Daniel C. Martin: And we think also with payers, while obviously payers look at different factors, you know, value and cost and such, at the end of the day, the gold standard for demonstrating, you know, head-to-head value is a head-to-head clinical trial, and that's what we have. We look forward to the read out of intrigue, and we believe, you know, pending positive results, we will be in a really good position for a successful launch on the second line.
Alex Sinagos: Sounds good, thanks. And one more, if I can. I think we've touched on this before, but it's been another quarter, and, you know, when you interact with doctors, what are you seeing with how doctors treat you, the student on the second line, and if it hasn't been different from the label at all?
Daniel C. Martin: Thanks for the question. I'd be happy to take that.
Daniel C. Martin: So, you know, we've done quite a lot of work looking at how physicians use Souten, and I assume your question really relates to dose and schedule. Is that correct?
Alex Sinagos: Yeah, exactly. Yeah, so what we see is really a mixed bag. So there isn't any one standard dose or schedule that's used for Sutton. So you see everything from the labeled dose and schedule of 50 milligrams, four weeks on, two weeks off, all the way down to patients who are getting 25 milligrams per day. And I think that's probably just reflective of the tolerability challenges that are often seen with Souttenant.
Daniel C. Martin: Thank you for taking my question. Thank you. And our next question comes from Brad Canino, from Firms Defle. Your line is
Bradley Patrick Canino: Your line is now open. Great afternoon, and congratulations on the additional approvals for Kinlock. One on Intrigue and then one on the pipeline. You know, as I've been having my conversations heading into the intrigue data, one of the sticking points remains the high rate of censoring you announced back in early 2020. So I'd just like to ask, what is your level of confidence that you have that the censoring will not add bias to the PFS measure for either drug arm? So thanks for the question, Brad. This isn't something that we spend a lot of time thinking about.
Steven L. Hoerter: So, you know, we announced the addition of patients at the beginning of last year. We're really pleased with the conduct of the study and how the team has navigated intrigue during the pandemic, in particular, and following regulatory guidance from regulators around the world. So we're pleased with how things have been conducted and looking forward to reporting at the top line. Okay, I appreciate that.
Bradley Patrick Canino: And then on the call, you spoke at length about the ALK inhibitor. It sounds like you have pretty grand ambitions for multiple combination therapy trials. So, Steve, how are you thinking about value creation for shareholders with this asset, given that you're already in three phase three programs and spending on those? Is the ALK Inhibitor program something that would be better to outlicense and co-develop, and if so, at what stage? Or do you think you can establish some R&D collaborations for free drugs where you share data but retain the cost and the value of the assets? Thanks.
Steven L. Hoerter: Yeah, thanks for the question, Brad. As we mentioned in the prepared remarks, we're really excited about the ALC program and its potential broad applicability. And Matt spoke to this in some detail, based on the data we reported at the triple meeting and, of course, what's been reported in the literature. So we do believe that this program has the potential to have very broad applicability in a range of solid and liquid tumors, potentially in combination with a variety of different targeted agents.
Steven L. Hoerter: So we're looking forward to continuing to follow the science here and to prioritizing where we want to, to take the ALK inhibitor in combination with other agents. And you'll be hearing more from us, I'm sure, in the coming months in terms of how we might decide to pursue that. But with respect to partnering specifically, it would just be premature for me to comment on that. But we're excited about the program and the opportunity to build long-term value.
Steven L. Hoerter: And thank you, and I am showing no further questions. I would now like to turn the call back over to Steve Hoarder for closing remarks.
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Steven L. Hoerter: Great, thank you very much. Thank you everyone for joining us on today's call and thank you for your continued support. We look forward to keeping you updated on our continued progress. I hope you all have a great evening.
Operator: This concludes today's conference call. Thank you for participating. You may now disconnect.
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