Q2 2019 Earnings Call
Good day, ladies and gentlemen, thank you for standing by welcome to counter a fine.
Second quarter 2019 earnings conference call.
At this time, all participants on a listen only mode.
Later, we will conduct a question and answer session and instructions will follow at that time.
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As a reminder, this conference maybe recorded.
At this time I would like to turn the conference call over to Jennifer Mcnealey you may begin.
Thank you Olivia good afternoon, everyone welcome to our second quarter 2019 conference call.
Joining me today are Susan Molineaux, our founder President and CEO , Keith Orford, Chief Medical Officer, and Stephanie Wong Senior Vice President of Finance.
[noise], we've issued our press release and it can be accessed through our website at <unk> Dot com.
Before we begin.
I would like to remind you that today's discussion will include statements about our future expectations plans and prospects that constitute forward looking statements for the purpose of the safe Harbor provisions under the private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those indicated by these forward looking statements as a result of various important factors, including those in the risk factors discussed in the risk factor section of our quarterly report on Form 10-Q filed with FCC.
In addition, any forward looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date.
While we may elect to update these forward looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views change.
Please note this call is being recorded and with that I'll turn the call over to Susan.
Thanks, Jennifer.
Good afternoon, everyone and thank you for joining us today on our second quarter 2019 conference call.
I Calithera, we're building an integrated biotechnology, helping to develop novel small molecule uncle metabolism drug.
Drugs that are targeting tumor and immune cell metabolism pathways for the treatment of cancer and other diseases.
Hi building a pipeline of novel therapeutic product candidates, we are creating multiple opportunities to positively impact clinical outcomes for patients and drug development programs towards commercialization.
We currently have four programs in our pipeline and our productive R&D team continuously evaluate new targets and new molecules for consideration as novel development Kennedy.
In the second quarter, we achieved clinical proof of concept for our could have an ace inhibitor telesat positive topline results from the randomized phase two and try to study.
With the completion of the secondary offering in this quarter. We believe we are well positioned to execute on our strategy and advance our pipeline.
[laughter] positive phase two in Trotta proof of concept study is our first randomized study would tell us that.
Yeah, it's like demonstrating to tell Glenn Fabs active as a treatment for clear cell renal cell carcinoma or RCC.
Provide validation for our lead program.
Combined with favorable I must tell Glenn it's had doubled the median progression free survival compared to ever alignment with placebo in heavily pretreated patients with renal cell carcinoma.
It reduced the risk of death or disease progression by 36%.
In addition, consistent with our previous clinical experience tells us that had a well tolerated safety profile in combination with Everolimus.
So Glen Sather suffer selective good heavens sakes inhibitor to enter the clinic and is now the first to demonstrate clinical activities for the treatment of cancer.
Based on the compelling activity observed in this randomized proof of concept study, we believe tell a blend of staff has the potential to provide a novel treatment option for patients and physicians treating RTC and potentially in the future patients with other cancers.
Tumor metabolism has been a focus of our company since its inception.
Tell Glenn if that blocks the metabolism of glutamine I keep pathway for the growth and survival of mini cells.
Signal transduction inhibitors, such as ever line is an inhibitor of M. tour for Cabozantinib, a tyrosine kinase inhibitor for Teekay I blocked the metabolism of glucose in many cancer cells.
Dual inhibition of glucose and glutamine metabolism results in synergistic anti tumor activity as demonstrated in preclinical tumor models.
Based on this common mechanism of action tell Glenn if that has the potential to be combined with either teekay eyes or mtwo inhibitors. Two classes of drugs that are used to treat RCC today.
We are excited about the results in the and try to trial showing that telling glenna SAP is active in the b part renal cell carcinoma.
That is of particular importance to us because we are continuing to invest in RCC.
We are currently enrolling a second larger RCC trial, combining tell Glenn if that causes then it.
That trial called can Tata, it's a global randomized double blind placebo controlled pivotal trial designed to evaluate the efficacy and safety of telecom Monistat in combination with the composition it.
Compatible enroll approximately 400 patients and is designed to be a potential registration trial.
We are on track to enroll can Tata by year end and to report topline results in the second half of 2020.
We also continue to invest in Tel Atlanta step beyond renal cell carcinoma.
We have broadened our clinical development program for telephone if that to two new clinical trial collaboration with Pfizer as well as multiple investigator sponsored trials or ice tea.
In addition, tell Glenn if that is part of a broad and CIO sponsored seat have clinical investigation program.
Our internal drug discovery team continues to produce novel drug candidates with the potential to be highly differentiated new therapies in areas of unmet needs.
Our two new internally discovered novel small molecule drug candidates are both entering clinical development in 2019. The first one is C.V. 280, an oral arginase inhibitor for the treatment of cystic fibrosis, which is already in phase one studies and the second one is TV seven away and oral small molecule cdseventy three inhibitor for the treatment of cancer.
As our programs forward in development, we look forward to a number of important milestones.
In the second half of the year, we look forward to completing enrollment in our Registrational can top trial evaluating tell is less pad for the treatment of patients with immuno cell carcinoma as well as the presentation of data from our Archon Ace inhibitor program I N C. B 001158 at the 2019 ESMO conference in Barcelona, and with that I will pass the call over to Keith for an update on clinical program.
Thank you Susan.
Let's begin with a more detailed update until monistat aren't we termination inhibitor and our most advanced product candidate.
We are currently focused on forging a clinical and potentially commercial path for told Monistat in renal cell carcinoma.
The program includes two randomized clinical trials of kind of told when a stat for the treatment of RCC.
As Susan mentioned, the phase two and trying to trial of Entrada trial until when a stat in combination with ever lightness in late line patients recently met.
When a staff.
In the trial tell going to set minutes primary endpoint and doubled median progression free survival in heavily pretreated patients with advanced renal cell carcinoma.
When added to everolimus versus ever alignments with placebo.
We plan to submit the results for presentation at a medical meeting and can better update you on timing in the future.
We are also actively enrolling contardo a global trial of telegraphed as that in combination with Cabozantinib in second and third line RCC patients can Tata is a randomized placebo controlled trial in approximately 400 patients and has registration potential.
It is designed to evaluate the efficacy and safety of tell when asked that in combination with cabozantinib versus placebo plus cabozantinib in clear cell RCC patients who have previously received one or two prior lines of therapy.
Including at least one prior anti angiogenic agent or the Ipilimumab Nivolumab combination.
Patients are being randomized in a one to one ratio to either telephone a stat, plus cabozantinib or placebo plus cabozantinib.
Patients will be stratified Fi MDC risk category.
And prior treatment with anti PD, one PDL one therapy.
The prior the primary endpoint is progression free survival by independent review overall survival will be assessed as a key secondary endpoint.
We are pleased with the enrollment rate of the trial and we remain on track to report topline results of can Tata in the second half of 2020.
Late last year, we announced two new clinical trial collaborations to evaluate Pfizer's CDK four six inhibitor palbo cyclic also known as Ibrance.
And the PARP inhibitor tell as operator also known as Health center each in combination with Calitheras Glutaminase inhibitor.
So when the staff.
Preclinical data suggests that tells us that synergizes with PARP inhibitors to impair DNA synthesis enhance DNA damage and block of cancer cells proliferation in both HIV positive and HIV negative cancer models.
We recently initiated a phase one two clinical trial of the combination of tell Glenn the stat plus tell is offered in patients with RCC and CNBC.
The trial will evaluate the potential of tell when a sense is sensitized tumors dissolved tell us operate in patients regardless of mutations in the BRC gene.
Tell when the staff also synergizes with CDK four six inhibitors by enhancing cell cycle arrest and blocking cancer cell proliferation.
In July we opened a phase one two clinical trial of the combination of tell when a stat plus palbo cycling in patients with kras mutated colorectal cancer, CRC and patients with kras mutated non small cell lung cancer.
And at CLC.
We are pleased that each of these protocols are now open and enrolling patients into the dose escalation cohorts.
Next the originates program.
Hi, NCB zero Zero 11, 58 also known as 11 58 is an investigational first in class immuno oncology metabolic checkpoint inhibitor targeting argenis, an immunosuppressive enzyme secreted by myeloid derived suppressor cells or Mds fees to block T cell activation in tumors and 58 is being developed with insight in a co development co commercialization collaboration.
The program is progressing well and is actively enrolling multiple 11 58 trials. The first trial, we would like to highlight is evaluating 11 58, as a monotherapy and in combination with Pembrolizumab.
The second clinical trial is evaluating 11 58 in combination with each of three chemotherapy regimens FOLFOX, Jim cited being cyst platinum or Paclitaxel.
Primary endpoints include safety safety and the objective response rate.
We and our partner Incyte plan to present solid tumor data in an oral presentation at the ESMO meeting in late September .
CB to 80 is a novel origination hitter in the development.
In development for the treatment of cystic fibrosis.
Under our collaboration agreement with Incyte, we retain worldwide rights to develop Arjun ace inhibitors in specific non oncology rare disease indications, including cystic fibrosis.
Our business has been proposed to be critical in the pathophysiology of system cystic fibrosis and several other non oncology diseases CF patients have neutrophil infiltrates in their lungs, and these neutrophils secrete high levels of Argenis, hi originates activity depletes arginine, which in turn depletes nitric oxide.
Nitric oxide or in a row.
Is known to have potent anti microbial activity and has been shown to improve lung function when administered to CF patients.
We hypothesize that inhibition of Argenis with CV to 80 can restore normal Argentine and an o. levels and improved lung function and CF patients.
In February we announced that we filed denying the application for CB to 80 with USS DNA and initiated a phase one clinical trial.
This first in human Phase, one trial, which we plan to complete this year is evaluating the safety Tolerability and pharmacokinetic profile of oral CB to 80 in healthy volunteers.
Our next Onco metabolism drug candidate to CB seven away, an orally bio available small molecule inhibitor of Cdseventy three an enzyme in the immunosuppressive adenosine pathway.
Cdseventy three suppressed as immune activation by converting extra cellular ATP into adenosine.
CB seven away a potent oral inhibitor of Cdseventy three has both single agent activity and activity in combination with anti PD, one and standard chemotherapy in preclinical animal models, we plan to initiate clinical studies with CV seven away in 2019.
With that I'll pass it over to Stephanie for an update on our financials.
Thank you Keith and good afternoon, everyone sees our financial results for the second quarter 29.
As noted in today's press release.
Before we review our results.
Alright, there ended the quarter well capitalized following our secondary offering in June in which we raised gross proceeds of $58 million. We believe our cash position enables us to drive a clinical program and meaningful value inflection point.
And investments were 153.2 million at June Thirtyth 2019.
R&D expenses were 20.9 million for the quarter ended June 32009, compared with 17.3 million for the same period prior year.
Increase of 3.6 million was primarily due to 1.5 million increase in the telegraph that program, including ARCC and Tata trial, an increase of 1.5 million in the 11 15 program and an increase of zero point $7 million.
80 program.
PNM expenses were 4 million for the three months ended June Thirtyth 2019, compared with 3.5 million for the same period prior year.
Increased 0.5 million was related to higher professional services.
Net loss from operations for the three months ended June Thirtyth, 2019, with 24.2 million or 15 cents per share.
And with that I will now return the call back over.
Thank you Stephanie and with that operator, we are happy to open the line for questions.
Thank you ladies and gentlemen at this time if you have a question. Please press. The Star then the number one key on your touched on telephone.
If your question has been answered all your we soon will be yourself from the queue. Thanks.
The pound key to prevent any background noise. We ask that you. Please place your line on mute.
Your question has been stated.
One moment for our first question.
And our first question coming from the line of Jonathan Chang.
From.
The Leerink your line is open.
Hi, guys. Thanks for taking my questions and grass and all the progress.
First question can you help set expectations ahead of the ESMO presentations that our generics program in terms of how much data and how much are the data will be.
Yes, Hi, Jonathan Yes, so we will be presenting data from the 101 study.
And just to remind you that the one on one study is.
Studying 11 58.
Monotherapy as well as the Pembrolizumab combination across a variety of.
Cohorts, so we will be presenting.
Monotherapy data monotherapy cohorts as well as.
The some of the combination cohorts just as a reminder, the study continues to enroll.
And so we will present data on a subset of the cohorts based in part on the maturity of those data.
Got it.
Second question on the recent positive and try to update can you help us contextualize the data disclosed in terms of the patient population in this study and how should we be thinking about historical benchmarks for ever line.
Right so.
So yes. This is a very heavily pretreated.
Poor prognosis population.
And so these were most of these patients had received two prior tyrosine kinase inhibitor therapies.
They were.
Weighted toward intermediate and poor prognostic categories.
And then in general were.
Well just heavily pretreated relative to data that had been previously published so this was the I would say the first data set and this new population of patients receiving ever Linus.
Prior data would have suggested something in the range of three and a half months for the PFS for Everolimus in a second line population.
And this was again later line more heavily pretreated.
And and so that so the result of approximately two months PFS.
Actually it was not a surprise to our investigators when we reviewed the demographics in fact, we reviewed the Democrat demographics prior to having that the.
The actual data unblinded and they let us know that it's likely going to be a short PFS for this population.
Got it thanks for the color.
And when can we expect to see a presentation of the and try to data.
So our practice is to submit data to a medical meeting and then disclose acceptances in line with the meetings embargo policy.
So when we have more information we will let you know.
But we plan to disclose more data either in the upcoming months of this year or the first quarter of next year.
Got it and just one last question any guidance and cash runway post the recent offerings.
We haven't updated guidance, but as you know we ended the year at 136.2 million and at that time, we expect that utilized cash of 75 to 85 million ton that was back in January the guidance hasn't been updated and that didn't include the 58 million that we just raised in June . However, I can say, we are well capitalized to continue and milestones in each of our four programs, including that can type of trial.
Got it thanks very much for taking the question.
Thank you.
Our next question comes from the line of Mohit Bansal with Citigroup. Your line is open.
Great. Thanks for taking my question and congrats on all the progress from my side as rose.
Before I turn it off good one question relating to the Doctor 30 and.
How how should we compare and contrast, the patient population that you're enrolling in the drug overdoses contract.
Good data and then can you just remind us again about your thought about the fall wrinkles to conduct a study what you're expecting from the controller.
Thank you.
So the second question.
I think I missed.
It's Richard the powering of the study how your body and can Digest study and how how you're assuming control what are you assuming for control versus treatment out there. Thank you.
Okay, Yeah, great. So yes to the patient populations between these two studies are.
Similar and that they are both RCC clear cell RCC patients, but they are a significantly less pre treated and that comes out of study. So we're focused on really where that can tata where I'm sorry recovers dancing and is currently approved which is primarily in the second line setting. So these patients are required to have received one or two prior therapies. So their second or third line. They will have received.
As few as zero she can't prior to chaos, if they if they had previously received the Ipilimumab Nivolumab Io combination in front line or they could have received one or two T.K. So zero to two ticket prior teekay eyes, we would expect.
Most of these patients at least many of these patients to have received prior Io.
And but but less heavily pretreated in terms of prior prior to chaos.
In terms of the.
The control arm you know this is a similar population to to the Meteor study and then the Meteor study the Cabozantinib PFS was in the range of seven and a half months.
There are some differences again, we have some some subset of patients will.
Uh huh, becoming in straight off of it the nivo.
And those patients you might expect to do.
Somewhat better than than historical data on the other hand. We also you know there are other factors at play in terms of.
You know what the distribution a prognostic categories are and so forth. So it's hard to predict but we're we're expecting it will be somewhat.
Somewhat longer maybe slightly longer than what was seen in the meteor study, but probably not substantially.
Got it then if I may ask one more.
The identity data coming in as well.
Should we expect more lets say they see responses at this kind of agent or do you think the response, we will be more pronounced in a combination.
Exactly.
So from mechanism of action. Thank you very much.
Yeah, you are feeling has been that on that.
This would be this Asian as an Io therapy as most new Io therapy is being developed.
They are more likely to be active in combination with PD one.
And so that's really our primary focus in terms of our our development plan and so that's that's really where I would focus but.
But I would say responses are data the question that I think if we were to see responses.
I think it would be nice proof of concept for the molecule and nice support that Arjun ace inhibition on its own has activity but.
What will be able to talk more about that.
At ESMO.
Great. Thanks for taking my question.
Thanks.
And our next question coming from the line of Matt <unk> with William Blair. Your line is open.
Hi, Good afternoon. Thank you for taking my questions as well.
One on the margin is program just how much that is in the abstract sense, obviously that'll be coming first.
More of a place holder as their actual.
Kinda results in there I believe they're coming towards the end of September .
A little before the conference itself.
HM.
I think that the abstract is indicative and focuses on most of the day then it will be talking about and of course, there will be an update on a couple of months I mean, it is an ongoing trial. So it sounds like fluid end depends upon what we see as they get closer to as now, but I think the abstract focus will be similar to the focus of that presentation.
Got it thanks, Susan So I know you guys are still trying to figure out where to bring the and try to result, so it's still a dependent on that but do you think the full data presentation will have and look at the overall survival results I know there weren't mature.
When you guys topline to.
A couple of months ago.
Yeah. It's you know again, we'll present hi, Matt if we will present the data when they are mature and so the timing of the presentation may impact you know whether or not the west data will be presented but.
It's certainly possible that Oh, I stay will be in that presentation.
Thanks, Keith and then lastly.
I wanted to get your thoughts on the.
Pavel cyclical combo in the K recipe in populations, particularly given now the recent K AMG 510 results and just kind of activity in the space with some of these inhibitors.
So maybe that's only one.
Specific aerospace station. So maybe that's kind of a thing where you can take but just curious how you're thinking about that landscape I guess.
Yeah, Matt obviously, the data have been impressive but.
They are restricted to a specific kras mutation and it is you know there is a unique aspect of the binding site that makes them, particularly susceptible and so whether or not other kras mutations will be as.
Susceptible to to inhibition I think is an open question. So.
So were still confident that K Ras remains an important.
Unmet need.
As you know, it's it's one of the most frequently mutated aka genes in cancer and we continue to remain interested in it thats a target.
Population.
Thanks, Keith do you think we see some initial data from the two Pfizer combo studies next year.
Well you know that services. This is the design of this study is going to be an open label dose escalation followed by open label expansion cohorts. So I would think it's possible that by the end of the year, we might have some data that we could present, but it's early right now to you know to know.
But obviously this is not a blinded randomized study so it's possible that we would be able to do that by the end of next year.
Thanks, and last question, obviously this year.
You know positive and try to results plus also expansion to two novel combinations.
Especially on the back of the positive trial results you know the true randomized data do you see.
Looking for additional indications with Douglas that additional combinations or kind of happy with the trials ongoing right now I want to see that can Todd results.
What do you think a broad strategy wise for the next year.
Oh, that's good question that we are continuing to look at other possible trial to start and one probably have the highest interest to us.
Is that continuing to examine the.
Try a pathway that keep nurse.
Passed away that's involved in managing oxidative stress and good bye and synthesis and so I think you're aware.
We and others have data, saying that that's a population that quite quickly Tammany sensitive and in addition interactive is an interesting presentation at ASCO looking back retrospectively at lung cell trials showing that this population that's poorly on current therapy, suppose PD, one and chemotherapy. So I'm, we're aware that data and were considering possible ways to address questions in trials in the future.
Great and I know it's interesting thanks Susan.
That's all from me.
Thanks, Matt.
Our next question coming from the line of Kim.
With Wells Fargo. Your line is open.
Units.
Jim.
This would be one to eight.
Which is good.
Yeah.
When do you expect.
Sure.
Oh the question, but it's a little hard to hear it was a I'll just confirm its when is the first cystic fibrosis trial.
Starting and.
The design of the trial is that true and what is the trial look like and when when would you think you'll be able to stop.
Right. So so as we mentioned we're currently.
Running studies in healthy volunteers, I'm evaluating safety and PK and so forth and patient studies will.
Include patients with CF patients.
Irrespective of.
Of their mutation status that we'll be able to enroll patients.
Across all.
All CF mutation backgrounds and irrespective of their current therapy on.
On the sea of GR modulators.
So the population will be broad.
And we'll we'll include an evaluation of.
Safety likely in a dose escalation.
As well as an evaluation of both Biomarkers and.
Sort of fear endpoints of efficacy.
Is that something you think you can start early next year first half of next year.
Yeah, that's that's I think that's a reasonable assumption.
Thank you and then.
On seven or eight obviously cdseventy three.
Inhibitors.
Dropped off.
Oh, okay.
Yes.
Oh, Okay I'm sure he has removed himself from the queue.
Oh.
We can give him one more minute to dial in.
Sure as a reminder, ladies and gentlemen to ask a question. Please press the Star then the one Keith.
[noise].
[noise] [noise].
Our next question coming from the line of Jonathan Chen with SVB Leerink. Your line is open.
Hi, guys. Thanks for taking the follow up just a quick question to fill the void.
Oh did you provide any color on how enrollment in the country to study is going or has the pace of enrollment been sort of consistent with your plans initially.
Yeah, we've been very happy with enrollment.
Across all regions. So I I would say we're on track.
Got it thank you.
Thank you and at this time I'm showing no further questions I would like to turn the call back over to Jennifer Mcnealey for closing remarks.
Thank you Libya and thank you all for joining us today have a great evening.
[noise].
Ladies and gentlemen, thank you for your participation in today's conference. This concludes the program you may all disconnect everyone have a great day.