Q2 2024 Corvus Pharmaceuticals Inc Earnings Call
Sure.
[music].
Unknown Executive: Good afternoon, everyone, and thank you for standing by. Welcome to the Corvus Pharmaceuticals Second Quarter 2024 Business Update and Financial Results Conference Call.
Speaker Change: Good afternoon, everyone and thank you for standing by welcome to the Corvus Pharmaceuticals second quarter, 2024 business update and financial results Conference call.
Unknown Executive: At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. It is now my pleasure to turn the call over to Zack Kubow of Real Chemistry. Please go ahead, sir.
Speaker Change: At this time all participants are in a listen only mode. Later, we'll conduct a question and answer session and instructions will follow at that time.
Unknown Executive: Total stock compensation expense for the second quarter of 2024 was $0.8 million compared to $0.5 million in the same period in 2023.
Rafael Gomez: It is now my pleasure to turn the call over does that Google for your chemistry Pease go ahead Sir.
Rafael Gomez: Thank you operator, and good afternoon, everyone.
Speaker Change: Thanks for joining us for the Corvus Pharmaceuticals second quarter, 2024 business update and financial results Conference call.
Speaker Change: On the call to discuss the results and business updates are Richard Miller, Chief Executive Officer.
Speaker Change: We chief Financial Officer.
Speaker Change: Jeff Archera Chief business Officer.
Speaker Change: Jim Rosenbalm Senior Vice President of research and Ben Jones, Senior Vice President of regulatory and pharmaceutical Sciences.
Speaker Change: The executive team will open the call with some prepared remarks, followed by a question and answer period.
Speaker Change: I would like to remind everyone that comments made by management today and answers to questions will include forward looking statements.
Speaker Change: Forward looking statements are based on estimates and assumptions as of today and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by those statements, including the risks and uncertainties described in corpus. Its quarterly report on Form 10-Q for the quarter ended June 32024.
Speaker Change: That was filed today and other filings the company makes with the SEC from time to time.
Lately: The company undertakes no obligation to publicly update or revise any forward looking statements, except as required by law with that I'd like to turn the call over to lately.
Thank you Zach I'll begin with a quick overview of our second quarter 2020 for financials, and then turn the call over to Richard for a business update.
Speaker Change: Research and development expenses in the second quarter of 2024 totaled $4 $1 million compared to 4.0 a million dollars in the same period in 2023, the net loss for the second quarter 2024 was $4 $3 million, including a noncash loss of <unk> 6 million related to Angel pharmaceuticals.
Speaker Change: Our partner in China. In addition, we recorded a noncash gain of $1 $8 million from the change in fair value of course is warrant liability during the second quarter 2024 associated with warrants that we sold as part of our financing completed in early May 2020 for.
Speaker Change: This compares to a net loss of $6 5 million for.
Speaker Change: For the same period in 2023, which included a $1 $3 million noncash loss related to Angel pharmaceuticals.
Speaker Change: Total stock compensation expense for the second quarter, 2024 was $8 million compared to <unk> 5 million in the same period in 2023.
Speaker Change: As of June 32024, Corvus had cash cash equivalents in marketable securities totaling $47 $3 million as compared to $27 1 million at December 31, 2023.
Speaker Change: This includes $33 million raised in our May financing.
Speaker Change: Based upon our current plans, we anticipate our cash provides runway into the fourth quarter of 2025.
Speaker Change: Note. The warrants we sold in May have an exercise price of $3 50 per warrant and expire on June 32025, if all of the warrants are exercised.
Speaker Change: Approximately $60 million in incremental capital.
Speaker Change: I will now turn the call over to Richard who will discuss our clinical progress and elaborate on our strategy and plans. Thank.
Unknown Executive: Thank you, Leiv, and good afternoon, everyone. Thank you for joining us today on our business update call. Now I will provide more detail on our progress, starting with Socolitinib Phase 1 clinical trial in patients with moderate to severe atopic dermatitis. The clinical trial is now open at several sites, and we will be adding additional sites based on our early encouraging experience.
Richard Miller: Thank you Leif and good afternoon, everyone. Thank you for joining us today for our business update call.
Unknown Executive: We anticipate sharing interim data from the initial cohorts in the fourth quarter. Additionally, we plan to begin patient enrollment in our Socolitinib Registrational Phase 3 clinical trial in relapsed PTCL in September of 2024. We are working with or in advanced discussions with a number of leading centers in the United States, Australia, Canada, and South Korea. The study is designed to enroll 150 patients randomized to Socolitinib or standard of care, which will be either Pralotrexate or Bolinistat.
Richard Miller: [noise] Corvus is pioneering the development of selective ITK inhibition as a new therapeutic modality for a broad range of immune diseases and cancer.
Speaker Change: <unk> our next generation ITK inhibitors has a unique mechanism of action, which works upstream to modulate key T cell signaling pathways. This mechanism is particularly relevant for immune and inflammatory diseases because it results in the modulation of multiple cytokines.
Speaker Change: That are the targets of current approved therapies.
Speaker Change: The emerging clinical evidence from our atopic dermatitis trial and our ongoing preclinical work supports the potential for socal at nib and selective ITK inhibition and several large patient population, including diseases, such as atopic dermatitis asthma psoriasis inflammatory bowel diseases.
Speaker Change: Scleroderma in other fibrotic diseases.
Speaker Change: We continue to gain confidence in our ITK inhibitor program, which we believe is now demonstrating activity in a broad range of diseases.
Speaker Change: On lymphoma and solid tumors.
Speaker Change: Our main focus continues to be advancing our lead ITK inhibitor Sokol at nib.
Speaker Change: The opportunity for ITK inhibition immune diseases is particularly exciting given its profile as a well tolerated oral medication the emerging clinical evidence from our atopic dermatitis trial.
Speaker Change: Our ongoing preclinical work and a wide range of immune diseases.
Speaker Change: In cancer, we remain on track to begin enrollment in our planned Registrational phase III clinical trial of so called <unk> for patients with relapsed peripheral T cell lymphoma in the third quarter.
Speaker Change: And our confidence in this trial continues to grow as another patient in our phase one <unk> trial experienced continued tumor regression and recently achieved a complete response after previously having a partial response at first follow up.
Speaker Change: Now I will provide more detail on our progress starting with socal. It in its phase one clinical trial in patients with moderate to severe atopic dermatitis.
Speaker Change: The clinical trial is now open at several sites and we will be adding additional sites based on our early encouraging experience.
Speaker Change: The trial is designed to enroll 64 patients with moderate to severe atopic dermatitis that have progressed on at least one prior therapy the.
Speaker Change: This study is randomized placebo controlled and blinded to patients and treating physicians.
Speaker Change: There will be four sequentially enroll cohorts of 16 patients with patients in each cohort being randomized three to one two different dosing regimens of socal at nib or placebo given for 28 days.
Speaker Change: Primary endpoint is safety and Tolerability and efficacy as measured using the clinically validated measurements of improvement in eczema area and severity index score also known as easy.
Speaker Change: And the investigator global assessment.
Speaker Change: The first cohort, which utilizes the lowest sokol at nib dose of 100 milligrams PID is currently enrolling and we have a few patients that now have completed the 28 day treatment regimen and follow up.
Speaker Change: While the patient and physician are blinded to the treatment assignment. The corvus team is not blinded to the trial results and I can report that although very early we see signs of clinical activity.
Speaker Change: So far treated patients have shown substantial improvement in easy scores at 28 days and corresponding changes in serum cytokine levels that are consistent with socal it nips mechanism of action.
Speaker Change: This is encouraging given this is the lowest dose cohort.
Speaker Change: Also we continue to find that the drug is well tolerated with no significant safety issues reported to date.
Speaker Change: There continues to be high interest in the trial and our novel drug we anticipate sharing interim data from the initial cohorts in the fourth quarter.
Speaker Change: The early preliminary data from these initial patients demonstrate important findings in serum cytokine levels that support the potential use of ITK inhibition in other immune diseases.
Speaker Change: Many of these changes are consistent with those that we have seen in preclinical studies in other inflammatory diseases and suggest that so call it and it could be effective in these diseases.
Speaker Change: We anticipate reporting on some of this work at the American College of Rheumatology meeting in November.
Speaker Change: We are gaining more evidence that social internet and selective ITK inhibition may be an important new treatment approach for a range of immune and inflammatory diseases.
Speaker Change: This is further supported by recent work from the lab of Professor Avery August at Cornell University.
Speaker Change: August is a preeminent immunologist and one of the world's leading authorities on ITK.
Speaker Change: These investigators demonstrated that ITK controls the fate of inflammatory th 17 cells. When ITK is inhibited by Socal at nib, the maturing th 17 cells convert or switch to T. Reg cells that suppress inflammation.
Speaker Change: So call it nib treatment in an asthma model of mice with allergic airway inflammation significantly reduced the percentage of th 17 cells in the lung, resulting in an increase in the ratio of T regulatory cells to th 17 cells.
Speaker Change: These studies confirm and extend our understanding of the role of specific ITK inhibition in inflammation and a relevant to many immune diseases.
Speaker Change: We also continued to advance our second and third generation ITK inhibitors, which we are further optimizing for use in treating immune and inflammatory diseases.
Speaker Change: We are focusing our preclinical development on asthma, psoriasis, scleroderma inflammatory bowel diseases, and fibrotic diseases with a host of additional indications.
Speaker Change: Indications identified for future work.
Speaker Change: Now for an update on so-called for peripheral T cell lymphoma or <unk>.
Speaker Change: While we are no longer enrolling new patients in our phase one trial. The data continues to evolve as patients on therapy complete their scheduled follow up assessments.
Speaker Change: In the most recent data cutoff from July 2015, we had one additional patient who demonstrated continued tumor regression achieving a complete response after having a partial response at the first follow up visit.
Speaker Change: With this update the objective response rate or <unk> for the phase III eligible patients remains nine out of 23 or 39%, but the number of complete responses has increased two 6% or 26% complete response rate.
Speaker Change: Although not studied head to head the complete response rate for Socal Lytton at that 26% is more than double that seen with Belinda stat or prelate Trek state. The standard Chemotherapies for <unk> that will be the comparator in our phase III trial <unk>.
Speaker Change: Similarly, the <unk> disease control rate progression free survival and overall survival for this group compares favorably to the results seen with <unk> or <unk>.
Speaker Change: The median PFS for patients which is the primary.
Speaker Change: Endpoint for our phase III trial is $6. Two months. This is substantially better than our reported results for the standard agents, which is one 6% and three five months for Belinda Stat, and Prowler Trek safe respectively.
Speaker Change: Durability of our responses is impressive with some of the earlier enroll patients now maintaining their responses for more than 24 months.
Speaker Change: We plan to begin patient enrollment in our so-called Aetna Registrational phase III clinical trial in relapsed <unk> in September of 2024.
Speaker Change: There are currently no FDA fully approved agents for the treatment of relapsed PTC L and the FDA has granted orphan drug designation and fast track designation for <unk> for the treatment of relapsed T cell lymphoma.
Speaker Change: Recently, we received a pediatric waiver from FDA, which means that we will not be required to conduct clinical trials in a pediatric population for this indication.
Speaker Change: We are working with or are in advanced discussions with a number of leading centers in the United States, Australia, Canada and South Korea. This study is designed to enroll 150 patients randomized in socal at nib or standard of care, which will be either <unk> or willingness that.
Speaker Change: We anticipate about 40 centers will participate in the trial the vast majority will be in the United States. Some of this study centers include MD Anderson Memorial Sloan Kettering City of Hope, Washington University and other high profile institutions. We are delighted to have the participation of leading academic centers.
Speaker Change: With extensive experience and expertise in conducting clinical trials in T cell lymphomas.
Unknown Executive: Outside of our atopic dermatitis and PTCL trials, we're also planning a so-called solid tumor trial as a single agent in relapsed renal cell cancer, representing a new approach to immunotherapy of this disease. The study is enrolling at MD Anderson, Vanderbilt, Duke, and the University of Pennsylvania.
Speaker Change: Outside of our atopic dermatitis and PTC L. Trials. We're also planning a so-called had solid tumor trial as a single agent in relapsed renal cell cancer, representing a new approach to immunotherapy of this disease.
Speaker Change: We also continue to advance our other clinical stage development programs.
Speaker Change: We have been one of the leaders in the development of adenosine <unk> receptor antagonism for the treatment of cancer with <unk>. This includes our phase <unk> clinical trial that is being conducted in collaboration with the kidney cancer Research consortium.
Speaker Change: The trial is evaluating <unk> as a potential first line therapy for metastatic renal cell cancer in combination with <unk> and <unk>. The study is enrolling at MD Anderson, Vanderbilt, Duke and the University of Pennsylvania.
Speaker Change: The results from the trial and supported published preclinical research demonstrates the potential of the combination of an anti <unk> four antibody with sypher, a dent into produced striking antitumor efficacy that is better than what has been observed when combining CFO with anti PD ones in July.
Speaker Change: A new patent covering our work with Sephora denim was issued in the United States and foreign counterparts are pending.
Speaker Change: As of the most recent data analysis on May 31, 32 patients were enrolled in the trial continues to meet our Prespecified statistical hurdle for continuation, which is the achievement of at least a 50% improvement in the deep response rate of 32%, which is associated with it.
Speaker Change: <unk> and <unk> combination alone.
Speaker Change: IP and relapsed non small cell lung cancer is underway in China.
Speaker Change: Summarizing the outlook for the remainder of 2024, we have important clinical milestones for Socal at Nib that we expect will increase awareness of the unique mechanism of action with ITK inhibition and its potential to address a wide range of indications.
Speaker Change: Upcoming milestones include four so call it mid <unk> number one starting our Registrational phase III clinical trial of <unk> in <unk> in September number two reporting interim results from our so called <unk> phase <unk> atopic dermatitis trial in the fourth quarter, followed by final data in early 2025.
Speaker Change: <unk> number three free present preclinical data in other immune diseases other immune disease indications at the ACR meeting in November number four initiate a phase II clinical trial with so called <unk> in solid tumors in the fourth quarter with initial data anticipated in the second half of 2002.
Speaker Change: 25.
Speaker Change: For <unk> reporting additional data from the phase <unk> trial in frontline renal cell cancer in the fourth quarter and reporting data in prostate cancer at the <unk> meeting in November.
Speaker Change: Our current cash runway our current cash gives us runway into late 2025, allowing us to execute on these important milestones and further demonstrate the value of our programs and in particular, the significant opportunity for ITK inhibition in immunology and in cancer.
Unknown Executive: Thank you, Leav, for those questions. I would expect that by the fourth quarter, we would be able to report safety and efficacy data on the first two cohorts of our clinical trial. The first two cohorts are enrolling patients treated at 100 milligrams BID and then 200 milligrams once a day. Of course, we're trying to move to once daily dosing. In terms of setting the bar for what we would consider success, I would say having a majority of the patients easy scores above 50% improvement.
Speaker Change: Yes.
Speaker Change: I would say, having a majority of the patients easy scores above 50% improvement.
Unknown Executive: Remember, this is a 28-day treatment, so that's a pretty good score in a short period of time. I would expect that data to be comparable to that seen in early clinical trials with Dupixent and other competitive products. So we're looking to be competitive. We think we have a certain advantage in the long term with an oral drug, a very good safety profile, and a novel mechanism that's going to be applicable to a range of immune and inflammatory diseases.
Speaker Change: Remember this is a 28 day treatment. So that's a pretty good score in a short period of time.
Speaker Change: I would expect that data to be comparable to that was seen with early clinical trials with <unk> and other competitive products. So we're looking to be competitive. We think we have certain advantage in the long term with an oral drug very good safety profile and a novel mechanism, that's going to be applicable to a range of immune and inflammatory.
Speaker Change: Tori diseases.
Speaker Change: Okay, great. So another question, which you talked about you're going to either immune diseases. So in terms of <unk>.
Speaker Change: The dose that you cannot be using do you expect that to be the same or slightly different based on the conditions.
Speaker Change: I would expect them to be.
Speaker Change: The same I don't expect that we're going to see gross differences in dosing remember we have a very precise way to measure the pharmacodynamic effects of our drug we can actually measure how much of the active side of the target is occupied by our drug and we're also beginning to get a handle on other.
Speaker Change: Biological functional assays.
Speaker Change: Such as the production of different cytokines, so I don't expect to have variability from disease to disease.
Unknown Executive: Okay, great. Thank you.
Unknown Executive: The Phase I Eta Bidermatitis Study Enrollment.
Speaker Change: Why it goes into balance sheet. He adds the first solid tumor in any three Canadian call about the rationale to support that.
Speaker Change: Okay.
Unknown Executive: Okay. Good question.
Speaker Change: Okay. Good question.
Unknown Executive: So, first of all, remember, socolitinib or specific ITK inhibition results in what's called Th1 skewing. This, of course, was predicted based on genetic knockout studies done 20 years ago, and with the motivation for us making a highly selective drug that blocks Th2, Th17 and induces what are called Th1 helper T cells, which lead to the production of an increase in CD8 killer cells.
Speaker Change: So first of all remember.
Speaker Change: So call it <unk> specific ITK inhibition results in what's called Th one skewing.
Speaker Change: This was of course was predicted based on genetic knockout studies done 20 years ago and was the motivation for us, making a highly selective drug that blocks th th 17 induces water call th one helper T cells those lead to the production of.
Speaker Change: An increase in CVA killer cells, we have shown in animal models and this has been shown by.
Unknown Executive: We have shown in animal models, and this has been shown by other investigators, that we induce a host anti-tumor response, not just against T-cell lymphomas, but in mice, we've seen activity against renal cell cancer, against GI tumors, against lung tumors, melanoma, and B-cell lymphoma. Other investigators have shown activity against other solid tumors. Now the reason we picked renal cell cancer in the clinical trial is, number one, renal cell cancer is a so-called immune-responsive disease.
Speaker Change: By other investigators that we induce a host anti tumor response, not just against T cell lymphomas, but.
Speaker Change: In mice, we've seen we've seen activity against renal cell cancer against Gi tumors against lung tumors melanoma and B cell lymphoma.
Speaker Change: Other investigators have seen other other solid tumors now the reason we picked renal cell cancer in the clinical trial is number one renal cell cancer is a so called immune responsive disease. We didn't want to go we wanted to go after a disease, where we knew that the immune system was important in our control.
Unknown Executive: We didn't want to go; we wanted to go after a disease where we knew that the immune system was important in controlling the tumor. We also had mouse data that showed us that sopalitin had worked really well in tumors that were resistant to anti-PD-1 therapy. So, there's clearly a need for therapies in renal cell that have a different mechanism of action and potentially can improve that PFS even longer and result in an improvement in survival.
Speaker Change: Selling the tumor.
Unknown Executive: So, renal is a good disease, but it's a good question. You could also say study melanoma, study lung cancer, you know, there are gastric cancers, there are plenty of other immune responsive tumors, but we were in a good position to do renal, and we had a very strong rationale for that.
Speaker Change: Be able to.
Speaker Change: The more efficiency expand the program. Thank you.
Speaker Change: Okay, well, we're really excited about the results both in lymphoma and in an early results and immune disease not to mention <unk>.
Mr. Archera: <unk> preclinical data, we're going to push <unk> forward and immune diseases and cancer as fast as we can of course, we have a lot of partnering discussions ongoing and Mr. Archera, Our chief business offers officers busily working away on those but we're pushing both fronts forward as.
Mr. Archera: As quickly and as fast as we can we will talk to partners.
Speaker Change: And we will determine as we get into these discussions based on.
Mr. Archera: The economics, the data et cetera, which you know how to expand these.
Speaker Change: Appropriately.
Speaker Change: Excellent. Thank you.
Speaker Change: Thank you and your next question comes from the line of $80 <unk> up from the 11, Brian. Please go ahead.
Brian: Hi, Richard and team congratulations on the progress.
Brian: Quarter, and congratulations with converting one PR to CR, so you're about six years.
Speaker Change: Cdpr snow and usually we get by source, usually we'll get the majority of the patients getting PR some.
Unknown Executive: So we do not yet have, I would say, a specific biomarker to predict responsiveness. Although in our phase 3 trial, where we'll have more patients, we do have biopsies. We do also have a research program that is going to be looking, using all kinds of very sophisticated techniques, looking at sequencing of the tumor, sequencing of the host infiltrate in these tumors, and of course, circulating normal blood cells to try to figure out what is predictive.
Unknown Executive: I might also add that almost all of the patients on our trial are so-called GATA3 positive. GATA3 is a transcription factor that's called the master regulator of helper T cells or Th2 cells. GATA3 positive tumors are known, it's in the literature, to be a very poor prognostic sign, very poor. In fact, my colleague Ryan Wilcox at the University of Michigan published a paper a few years ago in PTCL where GATA3 positive patients who went to the hospice did just as well as those that got chemotherapy.
Unknown Executive: Thank you. Very helpful. And another question I have is about second-generation ITK inhibitors. So could you remind us what is going to be different with socolizumab and when do you think they will enter the clinic?
Speaker Change: So with the Socal it named and when when do you think they will enter the clinic.
Speaker Change: So the second and third generation ITK inhibitors.
Speaker Change: Some have similar chemical structures with just slight changes.
Speaker Change: Some are very different chemical structures. Some are covalent some are non covalent reversible.
Speaker Change: We've been examining those.
Speaker Change: Each of those agents in various biologic assays that we have and we see some differences in their impact on for example, th two versus th 17 versus th one so I would say we're still in the process now of identifying the next generation four.
Speaker Change: For IND, enabling studies I think we're 12 months to 15 months away from.
Speaker Change: From studies in immune or inflammatory diseases.
Speaker Change: In the meantime, we blast forward with Socal in nib in immunology immune diseases and cancer.
Speaker Change: Alright. Thank you. Thanks, so much and congrats on the progress in school.
Speaker Change: Yeah.
Speaker Change: Thank you once again should you have a question. Please press Star then the number one on your telephone keypad. Your next question comes from the line of Jeff Johnson from Oppenheimer. Please go ahead.
Jeff Johnson: Good afternoon, guys. Congrats on all the progress it's great to see it.
Unknown Executive: Quick question on the AD data. Any thoughts on how you'll be presenting this? Will this be at a conference or is this something you might do more informally by press release or investor call?
Unknown Executive: All right. Great. Thank you very much, guys.
Speaker Change: <unk> readout for that study.
Speaker Change: So first of all the phase III registration trial I said it will start in September not by since December.
Speaker Change: And so that trial enrolled 150 patients there is an interim analysis.
Speaker Change: At 65 events PFS events.
Speaker Change: That's probably a year away. After we start the trial 18 months to complete enrollment two years to get the data less than two years to get the data.
Speaker Change: Top line data.
Speaker Change: Okay. Thank you very much.
Speaker Change: Yes.
Speaker Change: Yeah.
Unknown Executive: Thank you. There are no further questions at this time.
Speaker Change: Thank you there are no further question at this time.
Unknown Executive: Okay. Operator, thank you. Thank you, everyone, for participating in our call. We look forward to updating you on future conference calls. Thank you very much.
Speaker Change: Okay operator.
Speaker Change: Operator. Thank you. Thank you everyone for participating in our call. We look forward to updating you at future conference calls. Thank you very much.
Speaker Change: Yes.
Speaker Change: Thank you that does conclude our conference for today. Thank you all for participating you may all disconnect.
Speaker Change: Sure.