Corvus Pharmaceuticals Inc (CRVS) 2019 Q4 法說會逐字稿

Good afternoon, ladies and gentlemen.

Thank you for standing by, and welcome to the Corvus Pharmaceuticals Fourth Quarter 2019 Business Update and Financial Results Webcast.

Today's conference is being recorded.

(Operator Instructions)

It is now my pleasure to turn the call over to Zack Kubow of Pure Communications.

Please go ahead, sir.

Thank you, operator, and good afternoon, everyone.

Thanks for joining us for the Corvus Pharmaceuticals Fourth Quarter 2019 Business Update and Financial Results Conference Call.

On the call to discuss the results and business highlights for the fourth quarter of 2019 are Richard Miller, Chief Executive Officer; Leiv Lea, Chief Financial Officer; and Mehrdad Mobasher, Chief Medical Officer.

The executive team will open the call with some prepared remarks followed by a question-and-answer period.

I would like to remind everyone that comments made by management today and answers to questions will include forward-looking statements.

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 Corvus's quarterly report on Form 10-Q filed with the SEC on October 29, 2019, and other filings the company makes with the SEC from time to time.

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 Leiv Lea.

Leiv?

Thank you, Zack.

I will begin with a quick overview of our fourth quarter and full year 2019 financials, and then will turn the call over to Richard for a business update.

At December 31, 2019, Corvus had cash, cash equivalents and marketable securities totaling $78 million as compared to $114.6 million at December 31, 2018.

Research and development expenses in the fourth quarter of 2019 totaled $8.9 million compared to $8.4 million for the same period in 2018.

The increase of $0.5 million was primarily due to an increase in outside CPI-006 and CPI-818 program costs, partially offset by reduced outside ciforadenant costs.

Research and development expenses for the full year of 2019 totaled $38 million compared to $38.6 million in 2018.

The decrease of $0.6 million was primarily due to reduced ciforadenant costs, partially offset by an increase in CPI-006 and CPI-818 program costs and personnel costs.

I would like to note that we continue to carefully manage our expenses and currently expect full year 2020 net cash used in operating activities to be between $39 million and $42 million compared to $37 million in 2019.

The net loss for the fourth quarter of 2019 was $11 million compared to a net loss of $10.5 million for the same period in 2018.

The net loss for the full year 2019 was $46.7 million compared to a net loss of $46.9 million in 2018.

Total stock compensation expense for the fourth quarter and full year 2019 was $1.7 million and $7.3 million, respectively, compared to $1.8 million and $7.1 million in 2018.

I will now turn the call over to Richard.

Thank you, Leiv, and good afternoon, everyone.

Thank you for joining us today for our fourth quarter and full year 2019 business update.

In 2019, we made substantial progress enrolling patients in our studies in advancing our pipeline of precisely targeted oncology therapies.

The progress provides more clarity to finding 3 areas that our product candidates address.

Number one, adenosine pathway inhibition and A2A receptor blockade and inhibition of adenosine production by anti-CD73; number two, immunomodulation of immune cells particularly B cells; and three, modulation of T-cell function through the kinase ITK.

The key highlights from the year include the following.

We continued to report encouraging data from the Phase Ib/II clinical trial of ciforadenant in combination with atezolizumab in patients with advanced refractory renal cell cancer.

Ciforadenant is the most advanced candidate in development across the landscape of the adenosine A2A receptor antagonist, with more than 300 patients receiving treatment to date.

We reported the first data for CPI-006, our novel first of its kind anti-CD73 antibody, demonstrating that it may provide a new immuno-oncology approach both via the activation of immune cells and for the inhibition of adenosine production.

The data indicates CPI-006 has potential as a monotherapy and as a combination medicine in a variety of tumor types.

In addition, we continue to develop the Adenosine Gene Signature, which we believe will be an important predictive biomarker for ciforadenant and for CPI-006.

Our work in the adenosine pathway was reinforced by multiple independent studies from industry and academia over the course of the year, adding to our confidence that our programs are positioned for success.

Outside of the adenosine pathway, at the recent American Society of Hematology meeting, we presented initial data from the dose escalation portion of our Phase I study for CPI-818, our small molecule ITK inhibitor, making it our third program in the clinic.

This continued in January with additional clinical data presented at the T-cell Lymphoma Forum in San Diego.

In 2020, we will continue advancing our clinical studies for ciforadenant for CPI-006 and CPI-818.

I will begin with an update on the recent work with ciforadenant and the Adenosine Gene Signature that gives us increasing confidence in the outlook and trajectory of our lead program.

In the January 2020 issue of Cancer Discovery, our peer-reviewed article was published on ciforadenant and the Adenosine Gene Signature authored by Dr. Larry Fong at UCSF, one of Corus's clinical trial investigators.

The article presents the safety and efficacy results from 68 patients with advanced refractory renal cell cancer and for the first time in publication describes the identification and the potential to use the Adenosine Gene Signature as a biomarker for predicting response to therapy with ciforadenant and potentially adenosine blockade in general.

This study and the Adenosine Gene Signature were recently highlighted at the ASCO Genitourinary Symposium meeting in San Francisco in February.

Briefly, here are some of the key facts related to the Adenosine Gene Signature.

The signature has now been confirmed by other academic and industry groups.

The signature appears to identify a subtype of renal cell cancer that has a poor prognosis.

A group of patients that is unresponsive to anti-PD-1 therapies with a very low response rate and extremely poor PFS of less than 3 months, even in first-line setting.

Patients with high adenosine signature were generally low for an angiogenesis signature.

The angiogenesis signature is an established biomarker, which predicts response -- favorable response to angiogenesis inhibitors.

What this means is that the adenosine signature identifies a group of renal cell cancer patients, we estimate that this is about 50% of patients, that did poorly with current therapies.

The signature identifies a myeloid cell population in the renal cell cancer tumor microenvironment that functions as an immunosuppressive cell.

This now highlights this myeloid cell population as a potentially new target for immunotherapy.

That is targeting the myeloid component of the tumor microenvironment.

The Cancer Discovery article demonstrates that in patients with high levels of Adenosine Gene Signature expression, there was a statistically significant association with tumor regression with ciforadenant treatment.

Adenosine signature-positive patients achieved a 17% response rate by RECIST versus 0% in signature-negative patients.

These patients also demonstrated more durable progression-free survival with a tail on the curve for the adenosine signature-positive patients.

The data indicates that the Adenosine Gene Signature may be useful as a predictive biomarker to select patients more likely to respond to ciforadenant and that resistance to anti-PD1 may be reversed by ciforadenant in these patients.

It also suggests that the signature can identify patients with low expression of the angiogenesis gene signature, which can bring a poor response to anti-angiogenesis agents.

This double enrichment gives the Adenosine Gene Signature exciting potential as a biomarker that identifies patients that will do better with ciforadenant and have unfavorable outcomes with standard-of-care TKIs, tyrosine kinase inhibitors.

The article was further highlighted in the Journal's editorial by Dr. Michail Sitkovsky, Professor of Immunology at Northeastern University.

In addition to acknowledging the pioneering research, he noted that antitumor activity was seen in highly resistant patients.

We have already enrolled approximately 25 additional renal cell cancer patients with the goal of confirming the value of the adenosine signature.

We are also working on refining the signature and very good progress is being made in that area.

We intend to update both the clinical and biomarker data at the ASCO Annual Meeting in June.

With these additional data, we feel we will be positioned to initiate a late-stage trial based on the Adenosine Gene Signature in second, third or later line renal cell cancer patients.

There remains an unmet need for these patients and we anticipate that the signature will be capable of identifying a patient group that is likely to do better with ciforadenant compared to standard therapies.

We also presented data on ciforadenant in prostate cancer at the ASCO GU Cancer Symposium in February.

We are in the very early stages of this trial with a median follow-up of only 3.2 months.

The highlights from that data include, as mentioned, median follow-up of about 3.2 months, there was 1 partial response by RECIST.

This patient had a PSA drop from 98 to less than 1. 10 additional patients had tumor regression, not yet meeting the criteria for partial response, and 7 patients have confirmed stable disease exceeding 6 months.

Many of these patients with minor response and stable disease are continuing on therapy, and it is possible that their responses may deepen.

We intend to update this data at ASCO in June.

One other important finding reported in this presentation was gene expression profiling of tumor biopsies demonstrated a statistically significant correlation of tumor CD73 expression with the Adenosine Gene Signature.

This correlation supports the relevance of adenosine in prostate cancer, its production by CD73 and the expression of adenosine-induced immunosuppressive gene.

Let me turn now to CPI-006, our anti-CD73 antibody.

We continue to be enthusiastic about this novel immunomodulatory antibody.

We most recently presented data from the Phase I/Ib study at the Society of Immunotherapy of Cancer meeting in November.

Similar to prior results presented at ASCO, we are seeing activity in renal cell, prostate and non-small cell lung cancers with an acceptable safety profile.

We also continue to see dramatic effects on circulating immune cells with B-cell and T-cell mobilization and redistribution.

These cells are specifically activated into antibody producing cells, both in vitro and in vivo.

And these effects are adenosine independent and are related to the immunomodulatory agonistic properties of the antibody.

We are not aware of any other agents, antibody or small molecules targeting CD73 that has exhibited these properties.

It should be noted that interest in the role of B cells in immunotherapy has intensified.

Recent papers in Nature have shown that tumor infiltration with B cells are an important predictor of response to immuno-oncology therapies.

This gives us added confidence and interest in CPI-006.

Recently, we have found evidence that some of our patients are producing antibodies to their tumor following therapy with CPI-006.

Although preliminary, this is a very exciting and important finding.

In terms of the ongoing study, we have now selected the optimum dose of 18 milligrams per kilogram every 3 weeks for monotherapy and in combination with ciforadenant.

We recently opened the CPI-006 in combination with pembrolizumab arm of the study, and we expect to see and open the last arm of this study, which is CPI-006 plus ciforadenant plus pembrolizumab, a triplet regimen.

Finally, a quick update on CPI-818, our ITK inhibitor.

As mentioned in my opening remarks, we presented the first data on this program at ASH in December and at the T-cell Lymphoma Forum in January.

We have now reached a dose that substantially inhibits the target, so we are now positioned to evaluate potential efficacy.

The Phase I portion of the study has met our expectations as we have determined safety, PK, receptor occupancy, and we have selected a dose.

Early signs of antitumor activity have been observed.

In summary, we continue to believe Corvus is well positioned with worldwide commercial rights to 3 unique candidates in the clinic and a leadership position in the adenosine pathway.

In addition, the further characterization and confirmation of the Adenosine Gene Signature increases our confidence that we can identify the patients most likely to benefit from therapy with ciforadenant.

We intend to share meaningful updates on this program at ASCO in June.

I will now turn the call back over to the operator for questions and answers.

Operator?

(Operator Instructions) We will take our first question Charles Butler with ROTH Capital Partners.

Richard, 2 questions, really.

One is around the antibodies produced in patients that you've been able to cultivate, patients treated with 006.

Question is, have you found any common antibodies among those patients to date and same thing about antigens.

That's #1 and number two, when will we actually see up -- and you may have said this, so forgive me if -- that I missed it.

When will we see updates with the 006 data set?

Okay.

Let me take the -- your first question on the antibodies.

So we have observed low-titer antibody responses in a few of these patients.

In 1 patient, we've been able to identify the antigen.

And it is -- I'd rather not say what the antigen is right now.

But it is a bona fide lung tumor antigen.

Something that you would be very familiar with.

So what we need to be doing now, of course, is serially monitoring these patients and trying to figure out what happens to their titer of this antibody.

Now in addition to that, we, like many others, are isolating B cells from patients and looking at individual B cells and trying to dissect out what these antibodies might be reacting with.

As I think you're aware, the Nature papers back a month ago or so highlighting the importance of B cells infiltrating tumors has been more important in terms of predicting response in C cells really heightened our motivation in this area.

And as you know, I'm a former antibody guy, so I love antibodies.

And they seem to work pretty well in a lot of different things.

So we're really excited about the potential importance of the humoral immunity part of I/O therapy.

But really, it's very early in this work and so we don't have a lot of information yet as to what the importance of those antibodies are and what they might do.

Now in terms of data on 006, ASCO is going to be, I think -- I mentioned ASCO is going to be mostly about 444 in renal and the biomarker.

I think 006 work will wait till SITC in November.

We'll next go with Mara Goldstein from Mizuho.

Just 2 questions.

And the first is really on the adenosine signature.

And just understanding how you will incorporate that into the clinical trials that are ongoing and how you see that from a clinical practice perspective.

And then just on 818, I probably missed.

But can you confirm the dose that you're settled on?

Okay.

Let's take the first question.

So as I mentioned in my remarks, we've already enrolled an additional approximately 25 patients, which had the aim of confirming what we described in the Cancer Discovery paper.

And so far, we don't have all the data in on those 25 patients, it appears to be holding up very nicely.

We're now meeting with KOLs and lots of good thought leaders in the renal cell cancer area.

Probably in a few months, we'll be in a position where we'll talk about how we will incorporate this biomarker into our clinical trial plans.

But I can tell you, Mara, that it will be a very important part of our clinical trial.

Now your question on 818.

We've recently enrolled patients at 600 milligrams BID.

We've just gotten through the DLT period on that.

We don't see any dose-limiting toxicity at that dose.

We've confirmed very substantial receptor occupancy.

And we're following those patients now.

I think that this does -- we have a few other measurements we have to make in addition to receptor engagement, some other functional assays that we'll be looking at.

And also, even though you make it through the DLT period, it is nice to get a little bit more follow-up on these patients because you don't want to see side effects beyond the DLT period.

But I think that a dose of -- I think that we have a dose of now 400 to 600.

We will next go with Jeet Mukherjee from Jefferies.

This is Jeet on for Biren.

Richard, just wanted to maybe get a little bit more color on those 25 additional RCC patients you said you had.

I just was wondering if you had any details in terms of maybe how these patients compare to the existing patients that we've already seen.

And I have a couple of follow-up questions.

Well, I mean pretty much the same kind of patients.

We did restrict the number of prior therapies a little more because, of course, in our original 68 patients, being a Phase I study, and thank you for raising this point, there were all kinds of typical Phase I patients in this.

So we did try to get a little better patients.

And of course, the other big thing in these additional 25 patients was that you had to have sales in I/O and in TKI.

And the reason we did that is obvious in the last year or 2, it has now become a standard practice to give a TKI in I/O either first-line or first and second line.

So those are the differences.

Got it.

That's helpful.

And then just 2 other questions that I had was heading into ASCO, how many more patients worth of data could we expect for ciforadenant in prostate cancer.

I believe, on the ASCO GU poster, it had said that there was perhaps some follow-up plan at the 2020 ASCO meeting.

So just wanted to know maybe how many more patients we can expect there for that indication.

And will these patients be stratified by Adenosine Gene Signature?

Okay.

Prostate cancer patients, I think they were, what, 33 or 35 patients on GU ASCO poster.

I mentioned the follow-up is short.

I mean our main goal now is we're following those patients and trying to get more follow-up.

We did not stratify for adenosine signature in that.

Obviously, we're going to be looking at that.

I mentioned this relationship of CD73 in adenosine signature, which is an interesting observation, but doesn't get exactly to your point.

So -- but it does seem that since CD73 makes the adenosine and adenosine generates the Adenosine Gene Signature, all fits together very nicely.

But basically, I think what you're going to see at ASCO in our prostate cancer is a little bit more biology and more follow-up.

Okay.

Got it.

And then just my last question was on 006.

When do you anticipate opening the combination dosing on with pembro?

It's open.

It's open?

Okay.

Yes.

All right.

Any other questions?

(Operator Instructions) We'll head to our next question from Swayampakula Ramakanth from H.C. Wainwright.

This is RK from H.C. Wainwright.

Most of my questions have been asked, but recently written -- we noted that from clinical trials that within the new study of ciforadenant as a single agent and also as a combination with daratumumab reacts with multiple myeloma.

Can you give us a little bit of a background and update on that?

Yes.

Thank you for that question because I often neglect talking about that.

So the rationale for that study, which is being conducted at Johns Hopkins Medical School, which is perhaps one of the best myeloma groups in the world, the rationale is that daratumumab, of course, is anti-CD38 antibody.

CD38 turns out to be another important source of adenosine.

And there -- I won't go into the biochemistry, but NAV is broken down.

And one of the byproducts of that is adenosine.

And -- so the strategy is simply to combine an adenosine antagonist, like our ciforadenant, with daratumumab in patients who have failed dara.

So this is a really nice study where patients who are going through dara will get our A2A inhibitor added to it initially as a monotherapy, because remember, our A2A antagonist as opposed to everyone else's has demonstrated monotherapy activity, single-agent activity in many tumors.

So we want to look at myeloma cells, and we have some in vitro evidence for that.

And then I think within a month, they come in with the daratumumab.

And the idea there is you're trying to restore responsiveness to an otherwise resistant patient.

And of course, we're looking at bone marrow biopsies and blood and looking at their Adenosine Gene Signature and all the usual things.

So the rationale is basically CD38 is a good source of adenosine, and we want to come at that 2 ways.

There's very nice publication on that, that showed I think it was out of MD Anderson in various animal models that -- what they showed is that if you block A2A receptor in A2A receptor together with anti-CD38, you get synergistic response in those tumors.

They also looked at gene expression in patients and human biopsy samples and found that in CD38-resistant patients, there was an increase in A2AR, A2A receptor expression.

So that's the scientific rationale.

We're excited about that study because it gives us a lot of potential things that we can measure and there is a lot of good information.

We will next go with Tony Butler from ROTH Capital Partners.

Richard, the standard 25 patients in the (inaudible) my apologies to it.

They would be patients who have not previously seen I/O in TKI or who have?

Tony, it's hard to hear you, but the 25 patients I mentioned, they have seen, they have failed TKI in I/O.

Okay.

They have failed.

So they have seen.

Okay.

I just wanted to make sure.

Yes, yes.

We have seen.

Yes.

No, we are clearly focusing on the patient population.

Look, our strategy is very simple.

We're going to go late-line in existing patients, where endpoint's going to be attained presumably faster and so forth.

And then, of course, move up earlier as we get more experience.

Now the interesting thing is, is that with the success of I/O first line renal and second line, there are many, many more patients who are surviving to see second, third, fourth line.

So that is definitely becoming -- as we predicted, by the way, it is becoming a new entity or a serious patient population with unmet need.

It appears there are no questions at this moment.

I'd like to give the conference back over to the moderator for any additional closing remarks.

Okay.

This is Richard Miller.

Thank you all for participating in this call.

We thank you for those great questions.

Look forward to updating you on future calls.

And of course, hopefully, see you at our ASCO meeting.

Thank you very much.

This concludes today's call.

Thank you all for your participation.

You may now go ahead and disconnect.