Q1 2024 Aadi Bioscience Inc Earnings Call
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Speaker Change: Good day and thank you for standing by welcome to the Eddie Bioscience first quarter 2024 earnings Conference call.
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Audrey Gross: I'll turn the call over to Audrey gross head of corporate communications for Eddie Bioscience Best gross please go ahead.
Audrey Gross: Thank you good morning, and welcome to the added Bioscience conference call to provide an operational update and review our results for the first quarter of 2024.
Audrey Gross: On the call is such a deep limit, our president and CEO, Scott <unk>, our CFO and our Chief Medical Officer, Dr. Loretta.
Audrey Gross: Today, we will provide an overview of operational activity and financial results for the first quarter of 2024.
Audrey Gross: We will open the line for questions at the end of the call following closing comment.
Audrey Gross: A quick reminder, that statements made on the call today will include forward looking statements.
Audrey Gross: Actual events or results could differ materially from those expressed or implied by any forward looking statements as a result of various risks and uncertainties.
Audrey Gross: And other factors, including those set forth in the risk factors section of our annual and quarterly filings with Securities and Exchange Commission, which can be found at www SEC Gov or on our website at www dot antibody.
Audrey Gross: In addition, any forward looking statements made on this call represent our views only as of today may eight 2024 and should not be relied upon as representing our views as any subsequent date, we specifically disclaim any obligation to update or revise any forward looking statements with that I will turn the call over to Dave for <unk>.
Audrey Gross: Statements.
Dave: Good morning, everyone and thank you for joining us today to review, our financial and operational results for the first quarter of 2024.
Dave: At <unk>, we're focused on unlocking the full potential of MTR inhibition by uniquely combining technology and the potent <unk> inhibitor sterilized.
Dave: We believe napster wireless has the potential to deliver deeper inhibition of the MTR pathway and ultimately better outcomes for people living with cancers that are dependent on that pathway.
Audrey Gross: Today I'm pleased to announce that our registration intended precision one trial is now fully enrolled across a broad array of tumor types.
Audrey Gross: This is an important milestone as we seek to understand the potential napster alignment for patients with solid tumors harboring, either <unk> or <unk> and activating alterations.
Audrey Gross: Sizeable market.
Audrey Gross: Our latest internal analysis indicates there are approximately 16000 patients with these mutations across a variety of tumor types with mutations roughly evenly split between genes. Each mutation represents a potential multibillion dollar total addressable market for <unk> lines.
Audrey Gross: TST, one or <unk> driven cancers are found across a wider range of tumor types clustering and long gastrointestinal general urinary breast and gynecological locations and are often difficult to treat.
Audrey Gross: We believe precision one is a cutting edge trial testing, our innovative therapy napster alignment in these cancers.
Audrey Gross: Although precision was designed as a single trial each arm independently evaluated providing us with the ability to assess what our separately from the other given this design precision one can effectively be viewed as two separate studies each with its own outcome. As a reminder, in Q4, we provided top line results from a planned interim and evaluation.
Audrey Gross: For the first 40 patients enrolled in precision one.
Audrey Gross: These data demonstrated sustained tumor reductions in a heavily pretreated population based on investigator assessed responses in the first 40 patients across both arms.
Audrey Gross: Of note for the TST. One are we reported an investigator assessed overall response rate of 26%, which was within the range of our expectations.
Audrey Gross: These responses appear to be early deep and durable, which is especially noteworthy given this heavily pretreated population with a median of three prior lines of therapy.
Audrey Gross: Lastly, these responses were seen across four different tumor types potentially supporting a tumor agnostic indication.
Audrey Gross: I want to highlight that ongoing conversations with experts reinforce our view of the clinical significance of the responses. We reported from the first interim analysis, especially in.
Audrey Gross: Late line treatment in both patient groups. We continue to believe that should these results hold or improve and larger group of patients we have a path to submission and potential approval for <unk> mutations.
Audrey Gross: With the trial now fully enrolled we remain on track for our next plant interim readout, which is expected in Q3 of 2020 for this highly anticipated analysis will include a total of 80 patients who have been followed for a minimum of six months and we'll evaluate the primary endpoint of this study.
Audrey Gross: Independently assessed overall response rate as opposed to our December now interim analysis, which reported investigator assessed responses.
Audrey Gross: Looking ahead, we expect the study to be completed by the end of 2024 with full data in 2025.
Audrey Gross: In addition to precision one the phase III trials for two promising MTR driven cancer targets continue to enroll well as a reminder, on these two trials. The first is evaluating the therapeutic potential of napster alignments, and advanced or recurrent endometrial type endometrial cancer or EC.
Audrey Gross: In combination with aromatase inhibitor letrozole.
Audrey Gross: And Dmitry all cancer is the most common cancer of the female reproductive track and one of the few cancers with increasing mortality.
Audrey Gross: There was an estimated 10000 cases diagnosed annually in the U S alone prior clinical studies of <unk> inhibitors combined with Letrozole have yielded promising results and recent changes in the recommended standard of care for early stage disease creates a potential opportunity for this combination to be used in the first and second line settings.
Audrey Gross: The second trial is evaluating napster alignments in neuroendocrine tumors are net net is a rare with approximately 3500 cases a year.
Audrey Gross: Historically low response rate to the treatment with oral <unk> or other agents.
Audrey Gross: Nonetheless, our used clinically and recommended in treatment guidelines in preclinical animal models Napster alignments demonstrated proved target suppression relative to other <unk>.
Audrey Gross: Warranting further explanation of Napster alignments in the clinical setting for nets.
Audrey Gross: We're excited about this trial because it provides the opportunity to demonstrate what we believe is napster alignment. This best in class efficacy in a known <unk> sensitive tumor type.
Audrey Gross: Over activation and Dysregulation of the <unk> pathway is commonly found in various tumors and a unique delivery and excellent safety profile of Napster wireless provides the opportunity to combat these difficult to treat cancers as such we think these are promising indications and are eager to present initial data from these open label studies later this year.
Audrey Gross: As a final update to our development plans today, we announced that we have terminated our collaboration and supply agreement with Marathi now BMS.
Audrey Gross: That was evaluating the combination of it at aggressive <unk> selective inhibitor, <unk> and K Ras mutant non small cell lung cancer and other solid tumors at our request.
Audrey Gross: Actually agree with BMS to discontinue this early stage trial, which enables us to prioritize the valuation thats your alignment.
Audrey Gross: Ongoing phase II trials for the promising indications of EC.
Audrey Gross: Turning now to <unk> <unk> continues to perform well with net product sales for the quarter of $5 4 million for a bit of context. This is a decrease from prior year and reflects Q1 changes in distributor ordering patterns and fewer new commercial patient initiation in Q1 than historical average.
Audrey Gross: <unk>.
Audrey Gross: Swings in what is actually a very small number of patients may be due in part to cannibalization of top accounts, where we're seeing robust enrollment into our current clinical trials.
Audrey Gross: We believe this will correct itself in the subsequent quarters and we expect a return to sales growth in Q2.
Audrey Gross: The euro has cemented its position as the preferred treatment for malignant comma. After just two years on the market, we have high penetration across academic and community settings and have seen a consistent addition of new accounts ordering <unk> every quarter.
Audrey Gross: Now with more than 200 accounts ordering since launch we are proud of the impact Bureau has had and will continue to have for patients with this rare and aggressive cancer.
Audrey Gross: With sustained commercial success of <unk> cash runway into Q4, 2025, and a catalyst heavy 12 months ahead of US we are well positioned to realize our ambition to become a multi indication precision oncology company.
Audrey Gross: I will now turn the call over to Scott for updates on our financial progress Scott.
Scott: Thanks, Dave.
Scott: We ended the first quarter 2024, with $88 3 million in cash cash equivalents and short term investments.
Scott: Responsible capital management, including measures implemented in early 2024 to streamline our operations and reduce costs continue to support a healthy balance sheet that will fund operations into Q4 2025 based on current plans.
Scott: <unk> net product sales were $5 4 million for the first quarter, representing an eight 8% decrease from the prior year period.
Scott: As Dave mentioned this decrease was due in part to distributor ordering patterns in Q1, which we expect will correct in future quarters as well as lower commercial patient initiations.
Scott: Research and development expenses for the quarter increased to $13 6 million compared to $11 million in the prior year quarter.
Scott: This increase is primarily related to the continued progress of the ongoing precision one trial, which is now fully enrolled and the programs and endometrial cancer and Thats.
Scott: Selling general and administrative expenses for the first quarter were $10 6 million compared to $11 2 million in the same period in 2023.
Scott: This decrease is due mainly to reduced legal and consulting expenses versus the prior year offset in part by severance costs related to the streamlining of our operations.
Scott: Net loss for the first quarter was $18 3 million compared to $15 2 million in the first quarter of 2023.
Scott: For more information on our financial performance in the first quarter a detailed discussion of the results reported on this call will be provided in our Form 10-Q to be filed later today.
Scott: I'll now hand, the call back over to Dave for his closing comments Dave.
Dave: Thanks, Scott proud.
Dave: Proud of the strides we've made already this year, we're making tremendous progress against our clinical development plans with two sizeable markets and TST, one at TCT and activating alterations as well as other MTR driven cancers, we look forward to providing the highly anticipated <unk> interim analysis from precision one in the third quarter and to sharing an early look.
Dave: Our phase III trials later this year.
Speaker Change: Now we can open the line for questions operator.
Speaker Change: Thank you at this time, we will conduct a question and answer session. As a reminder to ask a question you will need to press star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again, please standby, while we compile the Q&A roster.
Speaker Change: Yeah.
Speaker Change: Okay.
Roger Song: Our first question comes from Roger song with Jefferies. Please go ahead.
Roger Song: Okay.
Roger Song: Great. Thanks, Thanks for the update and taking my question, maybe just quickly on the ECC and <unk>.
Roger Song: <unk>.
Roger Song: I'm curious about the deal.
Roger Song: The expectation into the initial data readout.
Roger Song: Later this year.
Roger Song: Particularly.
Roger Song: The patient.
Roger Song: Patient numbers, how much efficacy, we're going to see versus the.
Roger Song: The safety and et cetera.
Speaker Change: <unk> for that data update will be comp. Thank you.
Speaker Change: Great. Thank you Roger.
Speaker Change: So on the EC and net trial remember that these are.
Speaker Change: Two part phase two studies in the initial part ones and.
Speaker Change: Enroll approximately 10 patients in each trial.
Speaker Change: We anticipate we'll be able to report out early efficacy data and safety data.
Speaker Change: Those initial part ones by the end of this year.
Speaker Change: Alright, anything you would add to that.
Speaker Change: Only that the recruitment is going well.
Speaker Change: As anticipated and I don't think we're going to have any problem or reaching the ensign has been determined.
Speaker Change: Women two stage design.
Speaker Change: Yes, I think we are on target to report out results update.
Speaker Change: Yes, Roger we're very encouraged by both of these trials on bulk because theres been great interest in the community in.
Speaker Change: In these combinations.
Speaker Change: And exploring the potential of napster alignment is to improve upon what has been seen before with prior <unk> inhibitors. In these both of these basis. So.
Speaker Change: Hopefully, we'll see that pull through as we report out the first parts of this data.
Roger Song: Thanks Scott.
Speaker Change: Yes. Thank you.
Speaker Change: That's very helpful and in terms of the barrel.
Speaker Change: The sales trajectory understanding the <unk> seems that they've been kind of off compared to historical average, but any color around that.
Speaker Change: The parameters in terms of the first and then use duration on.
Speaker Change: Treatment and there may be some repeat dosing for those.
Speaker Change: <unk> patients and then maybe you also curious what's the feedback from the field from your position and results.
Speaker Change: Some impact to that barrel.
Speaker Change: Sales. Thank you.
Speaker Change: So two parts to that in a sense. So let me cover first on the parameters. We look at in terms of physician adoption awareness first line uses et cetera. All of those were extremely strong for us.
Speaker Change: As latest we've looked at that data and so we see no real changes in the communities of attitude towards the Aro and its use in Tacoma.
Speaker Change: We are in a more steady state situation with incremental sales growth and we expect some variation.
Speaker Change: Quarter to quarter to occur and as I think we indicated a little bit in Q4, we expected Q1 could be a lower quarter for us in this in the course of this year.
Speaker Change: Importantly, we remain.
Speaker Change: <unk> adoption remains very robust and it is really a small swing in new patient starts that has impacted.
Speaker Change: Crow here about half of that impact is driven by what we see in demand with new patient starts and some of our largest centers.
Speaker Change: These also correlate with the largest centers, where we've enrolled a large number of patients in precision one over the course of the last six to nine months and recall that we have usually anywhere around 90 patients commercially on drug at any one time and over the last nine months, we've recruited 80 patients.
Speaker Change: Into the precision <unk> trial, so typically clinical trials of the same scale and magnitude as the commercial business, but in this case that is that as we're more aligned in terms of what we're doing in the clinical trial side versus what's happening on the commercial side, maybe I'll just let Scott talk about the.
Speaker Change: Distributor situation and then I would like to go to Loretta to talk a little bit about the.
Speaker Change: Physician responses to precision one.
Scott: Yes sure. Thanks, Dave Yes on the on the inventory side as we noted we saw some swings in distributed inventory.
Scott: In the quarter, which is an.
Loretta: The unusually low level at the end of Q1 based on what we've seen in recent quarters and so we do expect that that's going to that's going to work itself out over the next few quarters.
Speaker Change: And then on the right I just want to comment maybe on.
Speaker Change: What we saw from investigators on the precision one interim results from their response and particularly.
Speaker Change: How that bled through to recruitment.
Speaker Change: Well.
Speaker Change: The responses that we saw.
Speaker Change: At the first interim actually.
Speaker Change: <unk> had virtually no impact on our crew.
Speaker Change: The community remains very supportive of this study we didn't Miss a beat.
Speaker Change: Frankly, given the very advance stage. Many of these patients remember that the median of prior therapies was three to three and a half with many patients having received more than five prior regimens. So.
Speaker Change: To the community to treat these patients the responses that we saw looked pretty good.
Speaker Change: And so everyone remains enthusiastic and we have not missed a beat in terms of our impact we had small uptick so.
Speaker Change: No.
Speaker Change: I don't know if thats what.
Speaker Change: Maybe that's the reality.
Speaker Change: I always want you to say the reality Loretta Thank you.
Loretta: Yeah, Thanks, Raj or any other questions.
Speaker Change: No. That's helpful. Thank you. Thank you for taking my question.
Speaker Change: Operator next.
Loretta: Thank you one moment for our next question.
Speaker Change: Our next question comes from Joe Catanzaro with Piper Sandler. Please go ahead.
Joseph Michael Catanzaro: Hi, everybody I. Appreciate you taking my questions just had a couple of quick ones. Maybe first following up on the Aero sort of commercial dynamic I guess I'm trying to understand this cannibalization sort of phenomenon that youre, describing it sounds like and maybe I'm just misunderstanding it.
Joseph Michael Catanzaro: But it sounds like youre, saying enrollment into precision one pulled away.
Speaker Change: Commercial coma patients and I'm trying to understand why that's the case.
Speaker Change: That's the case.
Speaker Change: And again, maybe I'm just totally misunderstanding. It so any help there I appreciate it and I have maybe one or two follow ups yeah sure.
Speaker Change: So Joe it's hard for us to tell exactly.
Speaker Change: What patients end up where what we saw is that the orders coming through this isn't.
Speaker Change: IV product and therefore, we don't get.
Speaker Change: Physician level data, but we get institutional level data and what we saw was a correlation between reductions in commercial business that some of our.
Speaker Change: Largest accounts that often were highly correlated with our.
Speaker Change: Precision sites.
Speaker Change: Some of our largest enrolling precision sites.
Speaker Change: At a patient level, we don't know exactly how that plays out, but we would anticipate that maybe a few of those patients.
Speaker Change: Sure.
Speaker Change: Spontaneous use like non docomo patients that were being treated commercially.
Speaker Change: And that position.
Speaker Change: Physicians took the opportunity instead of enrolling those patients in a commercial on a commercial basis may have enrollment into the clinical trials. So it's not the coma patients into the clinical trials because that's obviously an exclusion criteria in this case.
Speaker Change: And remember that we're talking about swings of 10 patients that create the gap that we saw in Q1 or last 10 patients or less that create the gap that we saw in Q1.
Speaker Change: And so it takes very few sets of decisions actually to sweeten the business that way.
Speaker Change: And so now with precision fully enrolled et cetera, the only option for patients that are looking for that last line opportunity in.
Speaker Change: <unk>.
Speaker Change: Non promoted indication would be to go back to that commercial business.
Speaker Change: Okay got it that's helpful.
Speaker Change: Just two quick clinical question I know you guys have said this would be your expectations, but wondering if you could confirm that within precision one the sort of baseline features for the full population aligns with the first 40 patients meaning.
Speaker Change: Heavily pretreated diverse set of tumor types and then for the <unk> decision to terminate that was that based on any data that has emerged out of that trial.
Speaker Change: Sure.
Speaker Change: So the.
Speaker Change: On the baseline population.
Speaker Change: From what we can see it's consistent with what we've seen before but obviously, we haven't fully evaluated the data to that and that will only come when we do the interim analysis on.
Speaker Change: On the fully.
Speaker Change: Cleaned and completed dataset.
Speaker Change: <unk>.
Speaker Change: And on the Marathi decision that decision had nothing to do with efficacy or safety that we saw in that trial.
Speaker Change: And in fact, we have very little data from that trial so far.
Speaker Change: And it's more it's very much a financial and the strategic decision to focus on.
Speaker Change: Endometrial program as well as the net program, where we're really excited about the potential for napster alignment in those indications.
Speaker Change: Yes.
Speaker Change: Thanks, Joe any other questions.
Speaker Change: Thank you Amit.
Speaker Change: Okay.
Speaker Change: Thanks, Joe.
Speaker Change: Go on to the next question next.
Speaker Change: Our next question comes from Tara Bancroft with TD Cowen. Please go ahead.
Speaker Change: Right.
Tara Bancroft: Hi, Good morning, So just wanted to follow up on.
Tara Bancroft: On the last question that Joe asked so how much difference in cost savings can we expect now over the next year or two now that you're you're ending this agreement.
Speaker Change: Sure Scott do you want to comment on outlook.
Scott: Outlook for spending.
Scott: Yes, Sarah Thanks for the question, Yes, we haven't shared that information specific information on the individual program there will be savings.
Scott: But we haven't we haven't shared that information.
Speaker Change: Okay. Thanks.
Speaker Change: Thanks, Terry or anything else.
Terry: No I'm good thank you very much.
Speaker Change: Operator, we can move to the other questions. Our next question comes from AHU Demir with Ladenburg. Please go ahead.
Ahu Demir: Good morning. Thank you for taking my questions two from US first one follow up to Roger's question could you provide more guidance on the EC program, what are the benchmarks and what would success look like in this interim analysis for this setting.
Ahu Demir: Super Thanks for the question.
Ahu Demir: Would you like to comment on that.
Speaker Change: Sure good morning.
Ahu Demir: So.
Ahu Demir: Hi, how are you.
Speaker Change: So this is it.
Speaker Change: It's a simon two stage design.
Speaker Change: <unk>.
Speaker Change: The first cohort.
Speaker Change: 10 patients.
Speaker Change: We're pretty far along in accruing those folks and the second the second portion.
Speaker Change: There will be an additional 19 patients for a total of 29 patients in the study.
Speaker Change: It's.
Speaker Change: It's designed.
Speaker Change: Q.
Speaker Change: To show on the basis of overall response, we're looking for a response rate that exceeds 20%.
Speaker Change: Our expectation of course is that it may be higher.
Speaker Change: That would be that would give you the kind of guidance I think youre looking for.
Speaker Change: That sounds great. Thanks. Thanks, Laura My second question is regarding to Milan to collaborations based on our scientific understanding there's a strong rationale between albumin uptake also therefore <unk> update uptake in Ras mutated cancers. So curious if you will be obtaining.
Speaker Change: The clinical data and do you plan to pursue this setting in the future any rest mutated cancer any ask Rick on that site.
Rick: I think we will see how the data comes in on the patients that were enrolled in the trial and make that decision at a later point in time right now we have no plans to.
Speaker Change: Expand into that area.
Speaker Change: Got it okay. Thanks for taking my questions.
Speaker Change: Thank you operator any other questions I'm.
Speaker Change: I am showing no further questions at this time I would like to turn it back to Dave for closing remarks, great. Thank you well thanks, everyone for joining the call. This morning, Thanks to Scott Loretta and Audrey for.
Speaker Change: Supporting this and I wanted to remind everyone that we really had great progress over the course of this year, particularly around our clinical study and development programs. We have now fully enrolled our precision one trial and look forward to our two thirds interim analysis in quarter three of this year, which will be a major milestone for us and determine.
Speaker Change: Where we go next with GSE, one Ntsc two mutant <unk>.
Speaker Change: <unk>, which are really large opportunity for us to expand the <unk> portfolio. We're also really excited about the progress we've seen EC and nurse enrollment and look forward to up early updates on those programs. Later this year and then finally, we expect to return to growth for <unk> in Q2 of 2024 and look forward to.
Speaker Change: Sharing updates on that as we progress our commercial business.
Speaker Change: Otherwise thank you for joining the call today, and we look forward to further updates as we go through the year. Thanks, everyone by now.
Speaker Change: Thank you for your participation in today's conference. This concludes the program you may now disconnect.
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