Q4 2021 Epizyme Inc Earnings Call
Hello, and welcome to the episodic fourth quarter and full year 2021 financial results Conference call. At this time all participants are in a listen only mode. Following the prepared remarks there'll be a question and answer session. Please be advised that today's call is being recorded I would now turn the call over to Kristin.
Hilton Investor Relations you may begin.
Thank you operator this morning episodic issued a press release, providing a business update in addition to fourth quarter and full year 2021 financial results.
That press release can be found in the investors section of the company's website at <unk> Dot com.
On the call today are grant Bogle, President and CEO of that design and doctors should Folly, Agra wall Executive Vice President and Chief Medical and development Officer.
Joe <unk>, Vice President and corporate controller, and Treasurer, who will join us for the Q&A.
As a reminder, today's discussion will include forward looking statements related to <unk> current plans and expectations, which are subject to certain risks and uncertainties.
Actual results may differ materially due to various important factors, including those described in the risk factors section of our most recent forms 10-Q, 10-K and other SEC filings.
These forward looking statements represent our views as of this call and should not be relied upon as representing our views as of any subsequent date, we undertake no obligation to publicly update these statements.
At this time I would like to turn the call over to grant Global Grant.
Thank you Christian and good morning, everyone.
It's great to be here with you and to provide an update on our fourth quarter and full year 2021 results.
On today's call I will review company results, including commercial performance, a patchwork and provide.
Additional business commentary insights on our cash position and updated guidance for 2022.
She probably will speak to our clinical development progress with Tazemetostat and easy I'm hopeful once for all.
Our investigational set the two inhibitor in more detail.
Following our remarks, we will open the line questions.
During the fourth quarter, we reported <unk> net.
Net product revenue of $11 6 million, including $4 2 million related to the sale of Pittsburgh commercial product for third party pharmaceutical company use in clinical trials.
Tests very commercial net sales for the fourth quarter of 2021 were $7 4 million, representing an increase of approximately 42% when compared with the third quarter of 2021.
For the full year ended December 31 2021.
We reported <unk> net product revenue of $30 9 million, including $7 4 million related to the sales of Pennsburg commercial product for the third party pharmaceutical company use in clinical trials.
Cadbury commercial net sales for the full year 2021 were $23 5 million.
Free goods from our patient assistance programs represented approximately 29% of total end user demand for the fourth quarter of 2021, and approximately 24% for the full year of 2021.
Total end user demand in the fourth quarter increased approximately 14% over third quarter 2021 level.
Given primarily by increased Follicular informal lymphoma patient sales.
We continue to make progress on our commercial efforts to drive prescription growth for Chad spirit.
As a mono therapy as well as advancing or combination clinical studies, which we believe have the potential to significantly expand the value and reach a patchwork amongst physicians and patients as the data mature.
As we announced in our press release. This morning, we continue to make necessary operational changes to reduce our expenses and extend our cash runway.
All while strategically deploying our resources to areas, we believe to be the highest impact for the company and its stakeholders.
We've implemented a plan that reduces our workforce by approximately 12%.
Along with external spending.
As part of this effort.
We have also re prioritized our pipeline, including discontinuing enrollment and select studies Symphony.
Symphony to an easy H 13 O one.
The sheer folly will review in detail. We continued to study tazemetostat in combination with numerous other therapies for both Hematological and solid tumor cancers through our ongoing company sponsored studies and investigator initiated studies.
I want to recognize the contribution of the episode of employees that are being impacted today and to thank them for all their efforts to advance our company's mission and vision.
Their transition from the company is being handled appropriately to ensure that it is as smooth as possible.
For those Apozymase, who remain with the company I also wish to thank them for their commitment and support as we continue to focus and streamline the organization for the benefit of all stake holders and the future of our company.
These initiatives along with the organizational and operational changes implemented what I joined as CEO last August .
Our designed to advance our vision of transforming the lives of patients living with cancer and helping established has barrick.
That foundational therapy in F L and other cancers.
Looking ahead to 2022, we plan to continue to educate providers and to align systems of care to support the growth of <unk> monotherapy.
While further advancing key clinical trial programs.
We are pleased with the progress we are making in our development program, including the global initiation of the phase III portion of our Symphony One study.
The near complete enrollment in the licensed study.
And the progress we are making in our phase II prostate cancer study cello one.
We look forward to providing updates on these important programs as well as other activities throughout the year.
At this time I would now like to turn the call over to sure Folly, who will speak to our clinical development progress sheer folly.
Thank you Glenn and good morning, everyone.
But Danny Wilson I'll pass that one O. One study we now have two molecules in clinical development has about the sad uneasy in all 414, a novel <unk> inhibitor.
During the fourth quarter, we made key progress across the development pathway.
I begin with Tazemetostat.
As we have previously discussed we believe that Tazemetostat has the potential to become a backbone of therapy, NFL and potentially other hematological malignancies and solid tumors.
Our clinical development program has been built with the aim of demand straining the clinically utility of using tazemetostat across a variety of hematological and solid tumors, both as monotherapy and then combined with other therapies.
Excited that much of the what that began several years ago is beginning to mature and we look forward to a steady stream of data in 2022 and beyond.
Speaking of the permission we are very encouraged by the Symphony one data we disclosed at the Ash annual meeting in December and I'm pleased to report that we have completed the waiting period for the protocol amendment submitted to the FDA in the Sun by specifying 800 milligram twice daily as the Tazemetostat.
Dose for the study, which allows us to open the randomized portion of the study in the U S.
As a reminder, the phase two portion of the study will evaluate tazemetostat in combination with the touch smart and you'll have to buy which we called us class.
But there are lots of practice Follicular lymphoma, who previously had been treated with at least one systemic therapy, including those who had it talks about the fracking and all have experienced progression of disease within two years plus 24.
Yeah actively engaged in global startup activities, including sites in greater China with a collaboration partner Hudson.
We are screening patients for the phase two portion and expect to enroll the first patients in the fourth quarter of 2022.
We expect to enroll approximately 500 patients in total across approximately 180 sites globally.
In addition, we continue to follow the 40 patients in the phase one B C. P that any portion of the study and anticipate longer term follow up data to be presented at the medical constantly to the P. S.
Turning to the life of study, which is the phase two study of Tazemetostat in combination with R. Chop for newly diagnosed D. N V. Seattle, our highest adult patients enrollment is now nearly complete for both ethylene and the M. D. C. S study cohort.
This is a large phase two study and as of February 28, you'll have 111 out of 122 patients enrolled in the D. M D C.
61 out of 62 patients enrolled in the FL.
The primary endpoint of the study is to evaluate complete the sponsors of Tazemetostat in combination with R. Chop.
In conjunction with lifetime anticipate presenting in terms of is that from the study India B C. L. F O patients in 2022 .
Moving to our solid tumor program Tele won an open label randomized phase two study evaluating tazemetostat, plus and Luna to might compare to <unk> monotherapy in metastatic castration resistant prostate cancer patients is progressing nicely.
The study is approximately 75% angles, the randomized portion towards the target of 80 patients.
But to complete enrolment in 2022 .
We anticipate presenting updated data from the completed 50, then enforcing an interim data, including the logical PFS.
PSA 50 from the phase two portion of the study in the second half of 2022 .
We also recently initiated a tazemetostat hematological basket study is yet one five or one a phase one one be signal finding basket study designed to investigate potential signals of safety tolerability and activity of Tazemetostat.
With this combination in patients with relapsed or proxy Hematological malignancy.
Specifically F L.
It feels like B cell lymphoma, mantle cell lymphoma and multiple myeloma.
We have entered into a clinical supply agreement with Roche for the Bispecific cohort of E. S. Athena one.
This cohort will evaluate the investigational use of Tazemetostat in combination with Muslims was about Bush's investigational T V. 'twenty PBT T cell engaging by specific antibody for patients with relapsed refractory Follicular lymphoma, who have received at least two or more prior lines of therapy.
We plan to provide updates on easiest Athena one obviously the key enrollment milestone.
Also plans to provide preliminary data from easiest Athena one in the second half of 2022.
Additionally, as John mentioned today, we announced cheaper authorization of our pipeline programs given the breath of episodic carbon doesn't matter a sad clinical development program. We have made the decision to discount to enrollment into study, including Symphony too, which is the study of Tazemetostat in combination with attached mob in third line.
Plus setting as well as easy as putting them on the solid tumor basket studies.
The decision to just sent you know these studies was based on evolving market dynamics and continued focus on optimizing that investment and eliminating potentially overlapping study.
The company will continue to follow the patients who have already been enrolled in the study.
We remain committed to the development of Tazemetostat in combination with other therapies for both Hematological and solid tumor malignancies, both an ongoing company sponsored studies as well as investigator initiated studies.
Turning to our novel first in class oral sagittal inhibitor development candidates easy I'm all for one port during the first quarter, we initiated several hundred one study a phase one b study of easy an awful month four in adult patients with lots of fracking in multiple myeloma and relapsed refractory diffuse large b cell lymphoma.
Yeah.
Easy I'm all for one fourth has been granted fast track designation by the FDA.
All patients with D. N V C N and have also granted orphan drug designation by the FDA for multiple myeloma.
We shared preclinical data on easy improvement fourth along which said one to one phase one one b clinical trial design at the 2021 ash annual meeting.
We plan to provide updates as the study would be just keep enrolment milestones along the trend and it may safety data expected from the study in 2022 .
As you can see we continue to advance the development program for Tazemetostat and easy I'm all for one voice and expect a steady cadence of data to the coming year.
The data would be important as we develop tazemetostat beyond F. N E S. Given its pipeline in a drug potential as well as potentially addressing high unmet need in multiple myeloma and there'll be still with us that day two inhibitor.
At this time I'd like to pass the call back to Glenn.
Thank you should follow.
We ended the fourth quarter with $176 $8 million in cash cash equivalents and marketable securities in January 2022, we raised an additional $79 5 million net proceeds in a public offering of common stock.
This raise as well as the cost reduction measures outlined earlier extends our runway into the back half of 2023.
Total GAAP operating expenses were $62 9 million for the fourth quarter of 2021, and $275 4 million for the full year ended December 31 2021.
Total non-GAAP adjusted operating expenses were $54 7 million for the fourth quarter of 2021, and $243 4 million for the full year ended December 31 2021.
We have revised our full year 2022 operating expense guidance due to the expense reduction measures and operational efficiencies discussed today.
We now expect 2022 total non-GAAP operating expenses of between $160 million to $180 million compared.
Compared to the prior guidance of 170 to 190 million disclosed in January of this year.
In closing I want to emphasize that all of the activities discussed today, both from a clinical development perspective, as well as an operational and organizational perspective continue to be guided by the four pillars of our strategy. These.
These include maximizing commercial adoption of testers.
Building on has your pipeline into drugs potential expanding.
Expanding our pipeline and portfolio.
And finally collaborating to expand our reach to patients and building incremental value.
We are making difficult, but necessary decisions to help ensure that we can deliver and our corporate imperatives.
I am pleased by the progress we've made and look forward to the growth and progress yet to come this year.
With that operator, you may now open the line for questions.
Thank you to ask a question you will need to press star one on your telephone to withdraw your question press the pound key.
Our first question comes from Joseph <unk> with Cowen Your line is open.
Hi, there good morning, and thank you for taking my questions. Maybe the first one just on on task in terms of the commercial setting as you look over the next year, maybe what are sort of the key drivers that.
That will kind of determine increasing sales and as youre seeing it right now.
Compared to launch our physicians using the drug in a different.
Ah patients for longer duration of earlier in the treatment paradigm kind of how is that shaking out.
Thank you Joseph.
So in answer to your question.
We continue to execute on the plan that we've laid out and.
And I'm seeing steady progress I mean in terms of of.
Really focusing on.
Engaging with health care providers and that means that they want to engage in.
And that has changed as a result of the pandemic and in many.
Clinics and hospitals that used to be open now want to engage in a more.
Digital way, which is which is fine. However, we are seeing clinics and.
In other parts of the country and so forth open up so.
We've adjusted our strategies to align with with that reality and as we've talked previously we were.
What are new.
Associates into our organization that have skill sets more in the system side of care delivery. So we are really aligning and I'm working with.
<unk> shipped within these systems to ensure that if a provider wants to used has barrick according to label.
That it's easier to do so by inclusion in and for example order sets that support appropriate prescribing.
For patients in different different settings, so those drivers of sales.
We'll continue to book I believe.
Strengthen our position and.
Lead to continued growth within our current label all the while the clinical development.
<unk> program continues to move forward and we're obviously going to talk.
And I have talked a fair amount about that so I'm excited about that because that again, we can't promote on that would not promote.
That information, but it does help inform clinicians.
But that 10 medical meetings, and so forth what the future potential of password maybe.
Perfect and then maybe just a follow up probably for Chipotle, but one of the basket studies. It was how it was discontinued but the other ones ongoing I guess can you give a little bit more information into this decision is it just based on kind of how the current standard of care is evolving.
Americas is better suited for us.
Hum tumors in terms of probability success kind of what went into that decision.
Thank you Joseph So in terms of the studies you know the reason to discontinue. These studies are based on changing market dynamics. It also we wanted to optimize our investment as that is the main one of the big reasons is M&A potentially overlapping toxicities. If you remember the solid tumor basket study that was gonna combo.
Issuance, but we do have a nice T that we are combining and part in those indications. So our goal is to get that data and really be able to get that data from that I S. T and that'll actually be important because once we know how it combines we can think about next steps and starting up a different trial in combination with PARP.
All we are very committed both in solid tumors and heme malignancies with Tesla. That's why we have the prostate cancer study as well. So we are committed to that and we believe that cosmetic as important board for solid and heme malignancies.
Perfect. Thank you very much.
Thank you Joseph.
Thank you. Our next question comes from Peter Lawson with Barclays. Your line is open.
Great. Thanks for taking my questions just just.
Thinking about revenues, what's the average duration of use of Tazemetostat.
I guess.
We could get by the end of the year.
So Peter we've not guided to that in the past.
And it is what here's what I can say about duration of use.
It is.
And that general trend increasing quarter over quarter.
And we would expect that mainly for two reasons. One is the data matures. So the more patients we get on Taz in them a longer we followed them.
See the duration of therapy increases the second is we do see trends and this sorry, Joe I didn't answer this question.
Directly when you asked it but we do see trends in our our tracking studies the two studies.
Help us guide market shares prediction projections and so forth we.
We do see trends, where physicians are tending to use has.
Earlier in lines of therapy.
Most of our uses third line plus but were seeing even growing use within the second line setting.
Albeit it is a small portion of that of the use today, so as as they move into earlier lines of treatment.
We would expect that that those patients would would stay on therapy longer. So it's it's a journey.
Trends are moving in the right direction and and.
So I believe.
Theres No reason, we would think that it would not continue in that direction for a period of time.
Thank you and then a question for valley really around the basket studies.
And that's been shut down should we read into that particular indications that.
Sure and a benefit from Tazemetostat.
Anything you can kind of help us kind of guide as to where you potentially see a benefit.
Beneficial activity.
Mr.
Sure. Thank you Peter Yeah. So in terms of looking at test like I think based on the mechanism of action and we have presented some preclinical data. We believe pads like you know can combined with many of the agents quoted human solid tumors. We have shown that in combination with our jobs and we've shown that with our square we have shown that the doxorubicin and he met him.
And then in solid tumors, we have shown with the IV and ends as well in prostate in terms of that basket study what I would it was more an effort do you know how we optimize our development and if there isn't overlapping study how do we get to that is effective and that's why as I mentioned, we have an ongoing study that is enrolling patients in combination with <unk>.
And we would get data from that study as well, but I I believe that based on the prostate study as well as we otherwise DS and <unk> studies in combination there's a potential in both indications.
Pennsylvania.
And Peter if I might add because this is I think really important for those on the phone to take away. The changes we've made to our operating expense guidance really have been done with a goal of ours.
Streamlining the organization removing.
Complexity removing.
Some layers of management where appropriate.
But that also involves simplifying.
Certain things that are under way, especially when we can get the data.
In a more efficient way, which is what really drove us in the heme I mean excuse me in the solid tumor basket study as well as quite frankly symphony too.
And if you look at the use of single agent Rituxan in the third line setting.
It is not significant in fact, its going down. So we felt that this was the most efficient decision and should know way.
B views, especially in the solid tumor area that we're not excited about taz is potential there, but we've got not only a large phase II trial underway in terms of cello, one that will continue to read out in prostate cancer. We've got other work underway in that with Isps and so forth. So I hope that puts it a little bit more into perspective.
Great. Thank you that really helps just seemed pretty one final question.
We get updated data this year is that kind of.
Year end update that we should be thinking about.
So in terms of Symphony one as you know that we presented a data at ash last year for the safety lead in portion of the study and you know as you know it's in second line and beyond to really continue follow those patients and three provide data this year and we haven't really guided on exactly the timing, but we will continue to provide in my eye and conferences.
As the data matures for Symphony run.
For the safety running portion of the study.
The important partners Peter that I want to highlight is that we have gotten clearance in terms of submitting the protocol amendment for 800 milligrams B I D and the phase II portion of the study and we are actively in the global startup and screening patients for that in my portion of the study as well.
Perfect. Thank you so much thanks for the updates.
Thank you. Our next question comes from Michael Yee with Jefferies. Your line is open.
Hey, Good morning, guys. This is Michael.
Thank you for taking our questions and I know, it's challenging to move the company forward in this environment I have two questions. The first is going to be.
041 for you.
You guys have initiated the first in human study, what do you expect will be or should be good data.
<unk> and multiple myeloma and then do you fully expect responses in those two paths allergies.
What's the bar that Youre looking for that would be.
<unk> tremendous study forward.
Yeah sure. So I mean, just kind of combining very odd for easy them Oh full run for as you know we are starting our first in human study dose escalation in spite of the study where we will escalate in board to multiple myeloma myeloma therapy, Seattle, We initiated the study last year, we are screening patients and hope to hold up.
Patient very quickly the goal in the first in human portion of the theatres to get toward doors that are safe and get preliminary activity in biomarker is and once we have that dose then we plan to expand into cohorts, where we would like to evaluate especially the default 14 classification, we have shown some pizza nickel data at ash last year.
We should specifically other activity in deep a 14 multiple myeloma, which is a big unmet need in myeloma and so our goal is to evaluate in that particular biomarker, which could be a faster path to registration in that portion of the study. Additionally, we look at 90 414, multiple myeloma as well as looking at how we do it.
If you look at Biomarkers and things like that so the goal is for us to get to a dose where just safe and then eventually expand in myeloma and evaluate did Michelle if needed.
Okay, great. Thank you and then you had mentioned that you had updated data from <unk> at some point in 2022.
Give me a little bit more guidance when we can expect that was that going to be.
Is that going to be at.
G U conference.
When can we expect that.
So the cello wasn't just dumping the start that we had presented the data for the safety run in the 21 patients at ESMO last year.
We continue to follow this patient, including an illogical BFS B is a 50 time to PSA 50 progression. Our goal is to provide that data second half of this.
This year. Additionally, we also mentioned that we have enrolled about 75% of the patients. The randomized portion of the phase two study a golar.
Goal is to provide some interim data second half of this year as well so as we continue enrolling patients as we have more follow up we'll get more further on the timing exact timing of the presentation.
Got you Thanks, and just one small last question you mentioned that you initiated the global Phase III study in collaboration with the Hutch met or are there any milestone payments given two <unk> one at the start of that enrollment.
No go ahead, so I think in terms of the startup activities. We are in the process of starting activities vault <unk> globally in terms of opening sites as you know, it's a big trial and it's about our you know our goal is to get the sites up and we are screening patients right. Now so that is the status both in China globally, adding U S. But.
Pass onto grabbed and tons of last time. So in terms of the collaboration remember we see we received a $25 million upfront payment of which.
That was the signing of the agreement and.
Yes, we're working on the global phase.
Phase III startup within China, and there are further milestones and also expense offsets that would occur.
Unconvincing of that but.
That's really where we're at right now.
Wonderful thank you for taking my questions.
Hum.
Thank you and as a reminder, if you would like to ask a question press. The Star then the one key on your Touchtone telephone.
Our next question comes from David Nearing Garden with Wedbush. Your line is open.
Thanks for taking my questions I have two first stop for life.
Yeah I'll have you.
Survey of doctors or.
Discussions.
With folks on what would be a.
I hate to say a quote unquote convincing but you know kind of a convincing you know overall response rate that would.
Yeah.
And maybe increase acceptance or use in earlier lines of therapy, and then for something that one could you just remind us if you have an interim look planned.
On that is as part of the trial design. Thanks.
Yeah. So to answer your first question David.
First question in terms of life as you know this this is a frontline trial in high risk FL NDA Bcl patients in terms of looking at the endpoint, we normally look at CRH and upfront trials and so you know as based on the data published with Lysol. The Sia read in Hydrous DLP Seattle Ah is.
Is about between 60% to 70% and that's how we have designed the trial. So the goal is to enroll as you know we had almost an ROE of nearly completely enrolled in that trial. So the goal is to be able to get that data interim data. This year and report on that and we have talked to like that has a big database, where they are you know look at patients who are.
Hi desk in a fun and it'll be sad because they bought a big unmet need and so the goal is to be able to inform physicians about that data and think about the next steps in the frontline <unk> patients in the indications.
In the second question regarding our Symphony one we do have to interrupt planned in this study the first interim as we've guided is basically based off the 100 responders, which is about 100 patients based on how we are seeing a response rate and which is a purity and Jim. The second interim is based on 65% of PFS events.
So those two and the second is dramatically is important because you have an opportunity to claim efficacy as we've aligned with the agency as long as it meet the protocol defined criteria.
Got it thank you.
Thank you and there are no other questions in the queue I'd like to turn the call back to grant Bogle for any closing remarks.
I just would once again like to thank everyone for joining us today and I'd like to thank the colleagues both should finally and Joe as well as the entire episode team for their hard work and dedication to moving our organization forward.
We look forward to providing updates in the coming months and speaking with many of you at the upcoming Cowen Conference next week have a great day. Thank you operator.
Thank you. This concludes today's conference call. Thank you for participating you may now disconnect everyone have a great day.
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