Cytokinetics Inc (CYTK) 2024 Q2 法說會逐字稿

Good afternoon and welcome, ladies and gentlemen, to Cytokinetics second-quarter 2024 conference call. (Operator Instructions)

I will now turn the call over to Diane Weiser, Cytokinetics' Senior Vice President of Corporate Affairs. Please go ahead.

Good afternoon and thanks for joining us on the call today. Robert Blum, President and Chief Executive Officer, will begin with an overview of the quarter and recent developments. Fady Malik, EVP of R&D will provide updates related to SEQUOIA's HCM and the ongoing clinical trials program for aficamten. Chris Murray, SVP of Regulatory Affairs and Quality, will provide an update from our recent interactions with FDA and EMA and the progress of our planned regulatory filings.

Andrew Callos, EVP and Chief Commercial Officer, will address commercial readiness activities for aficamten. Stuart Kupfer, our SVP and Chief Medical Officer, will provide updates regarding on the omecamtiv mecarbil, CK-586 on our earliest-stage development pipeline. Sung Lee, EVP and Chief Financial Officer, will provide a financial overview of the second quarter and review our updated financial guidance for 2024. And finally, Robert will review our corporate development strategies and review expected upcoming milestones.

Please note that portions of the following discussion, including our responses to questions, contain statements that relate to future events and performance rather than historical facts and constitute forward-looking statements. Our actual results might differ materially from those projected in these forward-looking statements.

Additional information concerning factors that could cause our actual results to differ materially from those in these forward-looking statements is contained in our SEC filings, including our current report regarding our second-quarter 2024 financial results filed on Form 8-K that was furnished to the SEC today. We undertake no obligation to update any forward-looking statements after this call.

And now I will turn the call over to Robert.

Thank you, Diane, and thanks for joining us on the call today. The second quarter was marked by significant progress and notable achievements across our later-stage clinical development programs built on the foundation of cardiac myosin modulation as well as a significant strengthening of our balance sheet and capital structure, enabling continued execution of the potential commercial launch of aficamten as well as further advancement of our pipeline.

In May, we were pleased to present the primary results from SEQUOIA-HCM in a late-breaking clinical trial session at the European Society of Cardiology's Heart Failure 2024 congress in Lisbon. As Fady will elaborate, these results met our already-high expectations. The safety and efficacy profile of aficamten that has emerged from SEQUOIA-HCM points to a potentially category-expanding opportunity as a next-in-class cardiac myosin inhibitor for patients with HCM.

During the quarter, we continued our dialogue with FDA ahead of our planned submission of an NDA. We participated in a productive Type B meeting with FDA to discuss potential strategies related to safety, monitoring and risk mitigation for aficamten. We are pleased at how these discussions went, and we're moving forward as planned. Chris Murray, SVP of Regulatory Affairs and Quality, has joined us today to provide an update on our regulatory interactions globally.

With respect to omecamtiv mecarbil, over the past year, we conducted numerous analyses of the results from GALACTIC-HF. We spoke with regulators on several occasions and we conferred with heart failure experts on the unmet need and the potentially unique role that omecamtiv may play in treating patients with heart failure.

Altogether, while we evaluated our potential next steps, what we found was a compelling opportunity for omecamtiv mecarbil to address a large and growing population of people with severe heart failure who have limited treatment options and are at increased risk of hospitalization. With high adjacency to HCM in terms of treating physicians, we believe we can deliver a high return on investment by advancing omecamtiv mecarbil with minimal increased commercial costs following the launch of aficamten, and again, should the confirmatory Phase 3 clinical trial of omecamtiv read-out positively. Furthermore, alongside CK-586, we see a synergistic opportunity from both an R&D and commercial standpoint to build a sustainable specialty cardiovascular franchise for patients and to further unlock and to potentially maximize value for shareholders.

Overall, we're proud to highlight an extensive development program for aficamten with multiple potential label-expanding clinical trials ongoing plus later-stage development programs in adjacent specialty cardiology indications with more still to come arising from our pioneering muscle biology research. We're carving out a specialty cardiology niche anchored in the foundation of our myosin platform and with our sights set on improving the lives of patients while also enhancing shareholder value.

And with that, I'll turn the call over to Fady, please.

Thanks, Robert. In the second quarter, we were very pleased to present three late-breaking clinical trial presentations in Lisbon, including the primary results of SEQUOIA-HCM and two additional analyses from the trial. The primary results, which were also published simultaneously in the New England Journal of Medicine, are consistent with our target product profile that may enable aficamten to become the cardiac myosin inhibitor of choice among physicians and patients.

The results showed that treatment with aficamten for 24 weeks significantly improved exercise capacity, increasing peak VO2 by 1.7 milliliters per kilo per minute compared to placebo with a p-value of 0.000002. This treatment effect was consistent across all prespecified subgroups, including patients receiving beta-blockers.

Subsequent improvements, all p less than 0.001 were observed in each of the 10 secondary endpoints. And patients treated with aficamten had substantial reductions in symptom burden, including a 7-point improvement in the KCCQ and 34% of the patients improving by at least one NYHA functional class compared with placebo.

Another way to evaluate the treatment benefit of aficamten is by looking at its effect on the underlying hyper contractility that's characteristic of HCM. In SEQUOIA-HCM, treatment with aficamten, resulted in a significant and substantial reduction in the post-Valsalva LVOT gradients of 50 millimeters of mercury or 60% of the baseline post-Valsalva LVOT gradient. Importantly, this reduction in LVOT gradient was paired with less than 5% of a reduction in LVEF on average. Overall, we observed rapid and substantial reductions in LVOT gradient without a negative impact on left ventricular ejection fraction, consistent with an improvement in the hyper contractility that occurs in HCM.

A recent manuscript published by Dr. Caroline Coats and colleagues in the Journal of the American Heart Association, detailed the safety and dosing results from SEQUOIA-HCM and expanded and reinforced these initial observations. The paper comprehensively describes the key results of SEQUOIA-HCM that were tied to its aspirational pharmaceutic profile and engineered into aficamten.

Specifically, these analyses show that aficamten rapidly reduced LVOT gradients within two weeks of treatment initiation without the need for either treatment discontinuation or interruption during the dose escalation phase. Additionally, the pharmacokinetics were generally linear with low variability once the target dose was attained, and that led to very little change in LVEF during the maintenance phase of treatment, essentially indistinguishable from placebo in that regard.

The effectiveness of down titration for LVEF less for -- LVEF less than 50% and the reversibility of its pharmacodynamics were convincingly demonstrated. Importantly, there were no associated heart failure events.

The goal of treatment in HCM is not only to reduce the LVOT gradient but it's also the normalized left ventricular ejection fraction. As the paper outlines, patients treated with aficamten with the largest excursions in LVEF from baseline -- 20% or higher -- all had baseline LVEF greater than 75%. None of these individuals had an LVEF below 50% at any visit. That's the largest reductions in LVEF occurred in the participants with the most severe hyper contractility, consistent with the objective of treatment.

The upcoming European Society of Cardiology meeting in London will have six presentations relating aficamten, including for late breakers and two oral presentations. Results from SEQUOIA-HCM related the KCCQ, cardiac structure, function, and biomarkers will be presented.

Alongside that, we'll be presenting an integrated safety analysis from FOREST-HCM and data related to the withdrawal of standard-of-care medications. We believe the totality of these presentations will importantly elaborate on how aficamten is achieving our target product profile.

Moving on to the ongoing clinical trials program for aficamten, we're pleased to report that we're on track to complete enrollment in MAPLE-HCM during this quarter. In fact, we are no longer seeking new patients to enter screening. As a reminder, this clinical trial is evaluating the potential superiority of aficamten as monotherapy compared to metoprolol as a monotherapy in obstructive HCM.

We expect that completing enrollment this quarter should enable results to read out in the first half of 2025, ahead of when we hope to be launching aficamten commercially, and if positive, will represent a potential label-enhancement opportunity and provide evidence on how aficamten could be positioned as first-line therapy relative to beta blockers in practice guidelines.

Enrollment in ACACIA-HCM, the pivotal Phase 3 clinical trial of aficamten in patients with symptomatic non-obstructive HCM has progressed substantially, and we continue to activate clinical sites during the quarter. Enrollment is brisk and remains consistent with our current projections. We look forward to continuing to enroll patients in the [ACACIA-HCM] through this year with the goal of completing patient enrollment in 2025.

Recently, the European Journal of Heart Failure published a short report with data from 34 patients within HCM through 36 weeks of treatment in FOREST-HCM, the open label extension clinical trial. This is the first data we have on extended treatment with aficamten in patients with nHCM. Aficamten appeared generally well tolerated with patients experiencing substantial improvements in symptom burden, NYHA functional class and NT-proBNP. There were no drug discontinuations due to adverse events.

These results suggest that longer-term treatment with aficamten can be both safe and effective in patients with nHCM. And we look forward to hopefully building on these findings with more data from FOREST-HCM and of course, seeing the results from ACACIA-HCM when available.

Our fourth ongoing clinical trial of aficamten is CEDAR-HCM, evaluating a pediatric population of patients with symptomatic oHCM which we opened to enrollment in the second quarter. CEDAR-HCM provides an opportunity to further extend the potential utility of aficamten, an additional segment of the broader HCM population as may further elaborate a next-in-class profile.

Finally, during the quarter, we started a Phase 1 study evaluating the pharmacokinetics, safety, and tolerability of aficamten in healthy Japanese and Caucasian participants to gather evidence that we believe will be required for potential approval of aficamten in Japan, again, expanding where aficamten may be able to have a meaningful, positive, and differentiated impact on patient lives.

Now I'd like to invite Chris Murray to provide an update on the regulatory front for aficamten.

Thanks, Fady. I'm pleased to join today's call to share updates on our regulatory progress during the past quarter. As Robert mentioned, ahead of our planned NDA submission for aficamten, during the quarter, we participated in the Type B meeting with FDA during which we discussed strategies related to safety monitoring and risk mitigation in support of our NDA submission.

As a reminder, two earlier meetings with the FDA were completed in February, including a first meeting to review the results of the SEQUOIA-HCM and a second pre-NDA meeting to cover specific topics related to our submission. This more recent third meeting provided the important opportunity to elaborate on the safety and pharmaceutic properties of aficamten and discuss how they may inform approaches to manage risk and gain insight into FDA's perspective on this matter.

We are very pleased with the progress we've made with FDA in this series of meetings. And FDA has continued to gain engagement ahead of the submission of the NDA for aficamten. While we understand that risk mitigation will ultimately be a review topic with FDA, following our recent Type B meeting, we plan to propose a distinct risk mitigation approach specific to aficamten with the NDA.

Another important outcome of our recent Type B meeting was that the agency agreed to a protocol amendment for the ongoing open-label extension trial, FOREST-HCM, reducing the frequency of echo monitoring required during the treatment maintenance phase. The amendment allows patients with oHCM to now undergo echo monitoring every six months instead of every three months during maintenance treatment if their LVEF is above 55%, and there's an absence of other conditions that may impact systolic function.

The protocol amendment was based on the overall safety and tolerability profile observed in the development programs thus far. As we've reported, there have been no treatment interruptions attributed to aficamten observed in FOREST-HCM to date. The approach to echo monitoring now implemented in FOREST-HCM reflects a potential real-world, risk-based approach for how clinicians could manage patients who are taking aficamten.

As previously communicated, FDA has agreed to are submitting the NDA on a rolling basis, which will provide FDA the opportunity to potentially begin their review of completed modules sooner. I am happy to share today that we initiated the first part of the rolling submission in July and that we are on track to complete the rolling submission during this third quarter.

Alongside our work enabling us to submit the NDA to FDA this quarter, we are also continuing to prepare our MAA for submission to the European Medicines Agency. During the quarter, we participated in pre-submission meetings with the EMA and national agencies in the EU during which we confirmed our plan to submit an MAA in the fourth quarter of this year, and we aligned on the content of the submission.

In parallel, we have participated in recent pre-submission meetings with the Chinese Center for Drug Evaluation and are coordinating with our partners Ji Xing to support plans to submit an NDA in China later this year. Altogether, Cytokinetics is taking big steps forward to ensure submissions for aficamten across major geographies globally.

Now I will turn it over to Andrew.

Thanks, Chris. In the second quarter, we finalized our market development campaign for aficamten, which we plan to launch next month at HFSA and continue to design the overall patient treatment experience inclusive of our specialty pharmacy distribution strategy and patient support program.

With the results from SEQUOIA-HCM in hand, we also advanced several market research studies to better understand the impact of the results on the trial -- of the trial and our potential product positioning, value propositioning, and market opportunity. I'm encouraged by the results I'm seeing from recent preference share research, which will ultimately be informed by our label and distinct risk mitigation approach.

During the quarter, we also continued our engagement with US payers. Recently, our payer account management team began pre-approval information exchange with key payers to review the results of SEQUOIA-HCM and the economic burden of obstructive HCM, and we expect to continue these interactions through our PDUFA date. We also initiated development of payer value dossier for both the US and Europe, which will define the overall value proposition in support of our planned reimbursement.

At the same time, we work to finalize plans for size, structure and alignment of the field-based sales teams, leveraging HCM diagnosis and treatment claims. I'll remind you that we are taking a disciplined and gated approach to spending as we expect to build our commercial infrastructure. We currently have onboarded a newly completed field sales leadership team, but that only represents a small percentage of our overall sales infrastructure. And we plan to hire a full sales team in 2025 in close proximity to the potential regulatory approval of aficamten.

We also continued progress in our European commercial planning activities related to positioning, branding, distribution, launch strategy, and reimbursement focused on Germany as the first country in which we would expect to launch aficamten with other key countries in Europe to follow. We're eager to continue to ramp up our commercial readiness activities through this year and into 2025.

To remind you, our plan is to continue to build a specialty cardiology franchise where we believe there is great potential to compete and succeed. Unlike a broader cardiology approach, the special cardiology interactions are focused on concentrated prescriber base across a subset of cardiologist, a limited distribution model, high-touch patient support services, and a large opportunity to address unmet patient need all pointing to the potential for higher return on investment. We're well on our way to building towards the future as we'll be led by aficamten.

With that, I'll turn the call over to Stuart.

Thanks, Andrew. I'll start with omecamtiv mecarbil. In our interactions with FDA, while the agency concluded that the results from GALACTIC-HF were not alone sufficient for approval, they were supportive of the conduct of an additional clinical trial of omecamtiv mecarbil.

As you recall, in GALACTIC-HF, the cardiovascular outcomes trial in more than 8,000 patients, we observed significant risk reduction of heart failure outcomes with omecamtiv mecarbil on top of standard of care, the magnitude of which was doubled in a large pre-specified subgroup of high-risk patients with lower ejection fraction. Heart failure risk and treatment benefit increased even further in those patients with more recent heart failure hospitalizations, higher NT-proBNP and lower blood pressure.

Given that the sub-group of lower injection fraction was over 4,000 patients, we're very confident in the potential benefit of treatment with omecamtiv mecarbil as an add-on therapy to standard of care in patients with severe heart failure. Planned confirmatory Phase 3 clinical trial will enroll approximately 2,000 HFrEF patients with severe heart failure and will include pragmatic design elements that enable us to be both smaller and more efficient than GALACTIC-HF, including less stringent safety monitoring requirements, a run-in period to enrich for more adherent patients and simplified entry criteria. We're preparing to begin this trial in the fourth quarter of this year.

Shifting now to our additional cardiac myosin inhibitor, CK-586. I'll remind you that we described this mechanism in some detail at the 2023 Biophysical meeting. We pursued optimization of the lead series that produced CK-586, because it had a different mechanism of action than aficamten. CK-586 does not bind to the motor domain of myosin like aficamten, but instead binds to the regulatory light chain of myosin and is a partial inhibitor of the myofibril ATPase. We still consider CK-586 to be a cardiac myosin inhibitor with its own distinct mechanism of action, and we're advancing it into further clinical development for HFpEF.

During the second quarter, we announced top-line data from the Phase 1 study showing that CK-586 was safe and well tolerated in healthy participants with generally linear pharmacokinetics at single doses from 10 to 600 milligram. At the highest single dose of 600 milligrams, the mean decrease in LV ejection fraction compared to placebo was less than 5%.

The PK/PD relationship for CK-586 appears to be even shallower than aficamten, and it has a shorter half-life. We plan to present these data in full at a medical meeting this quarter. And because the top-line findings are supportive of advancing the program, we're preparing to start a Phase 2a clinical trial in fourth quarter of this year in patients with HFpEF. We're pleased with the profile of CK-586 and believe it may further solidify our leadership in cardiac myosin modulation and our specialty cardiology franchise.

Finally, I want to provide an update on CK-136. During the second quarter we completed analyses of data from the Phase 1 study, which met its primary objective to assess the safety, tolerability, and pharmacokinetics of single and multiple doses of CK-136 in healthy participants. There were no safety signals or negative effects observed in the Phase 1 study.

However, in light of our recent decision to advance on the omecamtiv mecarbil, which is also the sarcomere activator, and after a review of the Phase 1 data and other strategic priorities by our portfolio review committee, we did not identify a compelling opportunity for CK-136 relative to omecamtiv mecarbil. As a result, we've decided to discontinue further development of CK-136.

And with that, I'll pass it to Sung.

Thanks, Stuart. We're pleased to report our second quarter of 2024 financial results. Starting with the balance sheet, we finished the second quarter of 2024 with approximately $1.4 billion in cash, cash equivalents and investments compared to $634.3 million at the end of the first quarter of 2024. The quarter-over-quarter increase was primarily driven by the execution of a public offering of common stock in the second quarter that resulted in net proceeds of $563.2 million after deducting underwriting discounts and commissions.

In addition, we entered into a $575 million strategic financing agreement with Royalty Pharma in May that delivered $250 million upon signing. The upfront amount is comprised of $100 million funding for a confirmatory Phase 3 clinical trial of omecamtiv mecarbil, $50 million investment in a Phase 2a clinical trial of CK-586 in HFpEF, $50 million term loan to support the potential commercial launch of aficamten in obstructive HCM, and $50 million for shares of common stock in a private placement. The remaining $325 million is comprised of a term loan of up to $175 million that we have the option to draw upon the satisfaction of certain conditions and an investment by Royalty Pharma of up to $150 million in a Phase 3 clinical trial of CK-586 should Royalty Pharma choose to opt in to fund the trial in exchange for an increase in their revenue interest in CK-586.

We believe the overall financing package comes with an attractive and market-competitive cost of capital and combined with the net proceeds from the equity financing, positions us well to support the commercial launch of aficamten, expand its development program and advance our pipeline.

Moving on to the income statement. Total revenues in the second quarter of 2024 were $0.2 million compared to $0.9 million for the same period in 2023. R&D expenses in the second quarter of 2024 were $79.6 million compared to $83.2 million for the same period in 2023. The decrease was primarily driven by the timing of clinical trial activities and wind-down activities for COURAGE-ALS, which ended in the first quarter of 2023.

G&A expenses in the second quarter of 2024 were $50.8 million compared to $39.7 million for the same period in 2023. The increase was primarily driven by investments towards commercial readiness and personnel expenses. Net loss for the second quarter of 2024 was $143.3 million or $1.31 per share basic and diluted, compared to a net loss of $128.6 million or $1.34 per share basic and diluted for the same period in 2023.

Now I'd like to turn to our updated financial guidance for 2024. We expect GAAP operating expenses to be between $555 million to $575 million, compared to the previous range of $535 million to $555 million. Non-cash operating expense comprised of stock-based compensation and depreciation, which is included in GAAP operating expense, is now expected to be between $105 million to $110 million compared to the previous range of $105 million to $115 million.

Non-GAAP operating expenses, which exclude stock-based compensation and depreciation, is expected to be between $445 million to $470 million compared to the previous range of $420 million to $450 million. Net cash utilization is expected to be between $400 million to $420 million compared to the previous range of $390 million to $420 million. The increase in GAAP and non-GAAP operating expenses is primarily being driven by the initiation of the Phase 2a trial of CK-586 and the Phase 3 trial of omecamtiv mecarbil.

With that, I'll hand it back over to Robert.

Thank you, Sung. As Sung summarized, we're in an advantaged financial position with a fortified capital structure that, we believe, will carry us through the potential commercial launch of aficamten and also allow us to continue to conduct potential label in category, expanding global clinical trials of aficamten, all while also advancing our later-stage development pipeline, including omecamtiv mecarbil and CK-586 focused to one area of biology in adjacent cardiology specialty segments.

To that end, we recently reaffirmed our intentions to advance our commercial strategies and build our specialty cardiology franchise. However, as we stated in an 8-K issued during the second quarter, we also recognize our fiduciary responsibilities to consider all potential opportunities to maximize shareholder value. This may take the form of building our business in the ways we've outlined today or it may involve M&A.

We fully understand our obligation to shareholders, and we will consider alternatives. But the way we can ourselves plan to maximize shareholder value today is by building enduring value in our pipeline and becoming a category leader anchored by aficamten. We also envision leveraging our R&D and financial strength to augment our pipeline with potential external opportunities.

To that end, during the quarter, we were pleased to welcome a new member to our Corporate Steering Committee, Isaac Ciechanover, over who joins us as Executive Vice President, Corporate Development and Chief Business Officer. Isaac previously served as CEO of Atara Biotherapeutics. He led business development at Celgene and held partner positions at leading venture capital firms.

Isaac will be responsible for expanding the company's presence into new geographies, catalyzing external R&D activities and mapping out potential new business objectives, which may include potential divestitures and spin-out companies as well as potentially M&A, both buy-side and sell-side and other business combinations. Isaac brings with him a wealth of knowledge and expertise for which we're grateful as we continue to build Cytokinetics.

I'm proud of our accomplishments this past quarter. And as you've heard, we're especially pleased with the progress we made with FDA relating to the NDA submission for aficamten and its potential for a distinct risk mitigation profile., if approved for commercialization.

Before we move to questions, however, I want to emphasize that due to the proprietary and confidential nature of our discussions with FDA, we do not intend to provide further details about our meetings with FDA, and we do not plan to present further updates on these matters, knowing that answers to any remaining questions will depend on FDA review.

Now I'd like to recap our upcoming milestones. For aficamten, we expect to present additional results from SEQUOIA-HCM at the European Society of Cardiology Congress later this month. We expect to submit an NDA to the FDA in Q3 2024 and MAA to the EMA in Q4 2024 and to coordinate with Ji Xing to support the planned NDA submission to the MMPA in China in the second half of this year.

We expect to complete enrollment in MAPLE-HCM in this third quarter 2024. We expect to continue enrollment in ACACIA-HCM throughout 2024, with objective to complete enrollment in 2025. We expect to continue enrollment in CEDAR-HCM this year to continue the Phase 1 study of aficamten in Japanese and Caucasian participants this year, and we expect to continue advancing our go-to market strategies for aficamten through the year.

For omecamtiv mecarbil, we expect to start a confirmatory Phase 3 clinical trial in the fourth quarter 2024. For CK-586, we expect to present primary data from the Phase 1 study at a medical meeting in this third quarter 2024 and to start a Phase 2a clinical trial in the fourth quarter 2024. And for preclinical development and ongoing research, we expect to initiate clinical development with a fast skeletal muscle troponin activator later this year and continue ongoing preclinical development and research activities directed to additional muscle-biology-focused programs through the remainder of the year.

And operator, with that, we can now open up the call to questions please.

Thank you (Operator Instructions)

Salim Syed, Mizuho.

Good afternoon, Robert. Thanks for taking the question, and congrats on the progress. I guess -- and want to welcome Isaac to the company.

I had a question on just that related matter with Isaac joining, is it possible to just give us how your framework into thinking here -- I know there was no 8-K or press release that I came across, but it seems like something that's important to the business. So just maybe the cadence of the business development activities we should be expecting and primarily and updated thoughts around aficamten Europe, if that's in the cards. Or was this more gated to potentially doing business development around the omecamtiv mecarbil? Thank you.

Yeah. So certainly, this doesn't change the way we're thinking about aficamten, either in Europe or in North America. And I do believe that our ongoing business development activities with respect to aficamten in Japan are already well on track.

The bringing on board of Isaac really speaks less to those matters and more to what I would fall under corporate development as opposed to business development. And I foresee where Isaac is going to take the lead as we think about what geographies we might want to increase our footprint in as a ongoing R&D and commercial enterprise and even more so to augment how we think about muscle biology, both buy-side and potential sell-side activities, meaning the following: we think that as a pioneer and a leader in this space, we're in a good position to imagine new possibilities and opportunities both to monetize the things we're currently doing and combine with potential others.

As we've discussed and many investors have asked in the past, how do we think about spinning out companies? How do we think about potentially being an aggregator of technologies? I wouldn't expect anything meaningfully large, for instance. I don't think this factors into how we're thinking about spending in a meaningfully large way. But I do think it ties to how we capitalize on our leadership in this space and maintain that ongoing leadership. And I believe that Isaac will be a great architect to working with R&D colleagues for how that strategy can ultimately be implemented less so this year and more in years to follow. I hope that answers your question.

Akash Tewari, Jefferies.

Hey, good afternoon. I realize you can't talk about your meeting with the FDA, but how much should we read into this protocol amendment on FOREST, which now allows a six-month echo for patients with an LVEF of above 55. Shouldn't this strongly predicts what in the REM should ultimately be? And is there a possibility of the FDA won't require a REMS at all pending more follow-up data from FOREST.

And maybe, Robert, if I could sneak in one more. You talked about why you might spin off some assets. Can you talk about why it might be preferable to spin off certain assets ahead of, let's say, pending M&A, if let's say, there is an overlap in a company that has a HFpEF portfolio. I'm thinking specifically about CK-586 five and spinning that asset off. Thank you.

Yes, I wouldn't interpret my earlier comments to suggest that we're thinking about spinning off any later-stage clinical programs as we believe our specialty cardiology franchise is the way that we do maximize shareholder value, whether that's on our own or through as you asked, potential M&A. But I do think there's a lot of value in what we're doing preclinically and otherwise, as we're expanding beyond specialty cardiology that could ultimately be monetized in other ways and as could benefit from funding in other ways.

As it relates to your question pertaining to FDA, again, I'll underscore -- I'm not really in a position to elaborate on the meeting. But however, we do believe FOREST represents a real world evaluation of aficamten, and we're pleased that FDA foresees, much like we do, how for having been monitoring echos on a more frequent basis in FOREST for a long time and having accumulated quite a lot of data, data that isn't contributing from a clinical standpoint, any meaningful changes in the way these patients are managed, FDA seemed amendable to our recommendation that we changed the frequency by which echo monitoring needed to occur.

So that's encouraging. But ultimately, I don't think I'll go so far as to make a direct correlation as you're asking between that change and what FDA may choose to do with respect to a potential risk mitigation profile. That's perhaps connecting of the dots that I'm unwilling to do on this call.

Fady, is there anything more that you might want to add on that matter?

I think the FDA's acceptance of our protocol amendment for FOREST and the consequent every six months of echo are reflective of the data that we've generated to date. So I would expect those data will sort of be important in their review of our NDA.

(Operator Instructions)

Jeffrey Hung, Morgan Stanley.

Hey, this is Mike on for Jeff Hung. Thanks for taking our question. Looking at HCM and just thinking more generally, physicians are likely aware of the benefits of CMIs at this point, but uptake remains more gradual. And a lot of these patients are still coming in on a prior beta blocker.

So thinking about that, how do you think about the results for MAPLE? And is that what's needed to take positions CMIs as frontline and really see that broad rapid uptake? Thanks.

I'll ask Fady to respond to that, please.

Well, that's a good question. I think the reason we designed and executed MAPLE was primarily to provide evidence for the use of aficamten as first-line therapy and not only just with regards to symptom improvement and improvement in function as we hope to demonstrate straight up against beta-blockers, but also looking at the differences in how the heart remodels, how does it affect the wall thickness, some of the things we've seen with chronic dosing of cardiac myosin inhibitors, no one's ever really characterized whether those things occur with beta blockers.

And we think the data in aggregate would suggest not only a functional and symptomatic improvement, but we will also show some evidence of disease modification. So all those things, I think, should contribute eventually changing the standard of care and from a beta-blocker first to a CMI.

Roanna Ruiz, Leerink Partners.

Hi, afternoon, everyone. So maybe tagging on to the discussion about MAPLE. I was curious if you could elaborate a bit more. It sounded like you mentioned that you could leverage some of the MAPLE data or initial results to help provide that to the FDA while they're reviewing aficamten's filing? And is there any impact that could happen with aficamten's possible labeling as well?

I'll take that. Roanna, I think what I did say in my section was that the data would be available prior to approval of aficamten, not that we would include them necessarily in our application, because the application will already have been in underway. But so then we hope with publication of the data would be available around the time of aficamten's potential approval. And I think the data are exciting and they just will provide another point of reference for physicians and our commercial colleagues to show the benefits of this mechanism of action.

Got it. And physicians would be able to reference this as well, right?

Well, if it gets published, they certainly will as I expect it will.

Paul Choi, Goldman Sachs.

Hi. Good afternoon and thank you for taking our question. Robert and Fady, I want to ask your view just on sort of next stages and planning of developments for both HFpEF and HFrEF in the context of recently positive GLP-1 data and just your thoughts there as to how that might be a potential treatment target in the algorithm or modality for them for heart failure, and just your thoughts on planning trials for 586 and omecamtiv mecarbil down the road here. Thank you very much for taking our questions.

Yeah, thanks for that question. I think it's a very important one in light of what we believe to be complementary mechanistic work that we're doing that is rooted in myosin modulation and as can provide an opportunity that would be sitting alongside of other therapies, but also for patients who may not benefit in the same way from those other therapies.

For that, I'll turn to Fady to elaborate.

Well, I think like many background therapies, they begin to treat certain population – a segment of the population that is responsive to them. Obviously, they're focused on the patients that have significant obesity. There are lots of HFpEF and HCM -- or rather HFpEF and HFrEF patients that are not obese and for whom you're not expecting really to see uptake of the GLP and GIP agonist.

So I think it's mostly just refining the patient populations so that there's not a moving target. You'd rather not have, just as we do with other background therapy, we require them to be stable on their background therapy before entering the trial. And similarly, a patient that wasn't entertaining beginning a GLP-1 probably wouldn't be eligible to continue or to be enrolled in our trial at least until they had reached some stable weight and still continue to meet the eligibility criteria. So there's sort of standard ways to deal with that that I think come we will certainly imply.

Maybe just to add one comment -- and while we are pleased to see some of these innovations in HFrEF and HFpEF, I think it's sometimes lost on analysts and investors, how unacceptably high the residual morbidity and mortality remains in these patients and especially how many patients still can't tolerate standard of care. And this is where we do believe opportunities exist for myosin modulation alongside of those therapies.

So we're looking forward to evaluating omecamtiv and also CK-586 five in places and in patients where they may not benefit from these other modalities and mechanisms.

Kripa Devarakonda, Truist Securities.

Good afternoon, Robert. Thank you so much for taking my questions. Your slides seem to indicate CMI preference share for aficamten in eligible patient population is about 60%. I was wondering about the potential of patients to switch from mavacamten to aficamten if especially they're concerned about safety or not satisfied with the efficacy. That may not be your base case, but was just wondering whether based on your market survey or are survey of KOLs, you see this as a possibility. Thank you.

Yeah. You and other analysts have done work in that regard that we find compelling as it relates to potential switches, but for which as Andrew can now elaborate and as you pointed out, that's not core to our strategy. But maybe, Andrew, you want to speak to that?

Yeah, certainly. So I guess a couple of things. One is we expect the vast majority of patients, probably over 80% of the market to be available and not on a CMI treatment when aficamten -- if it were to be approved.

Second, we will focus on new patients, educating physicians on the aficamten and the differentiation of aficamten. Our research tells us that it will probably expand the market. So more patients -- more physicians and more patients on a CMI and it'll expand share.

We're not going to talk about switches. We're not going to go for switches if patients are stable. And mavacamten or any other product work for them, then that will be up to the physician and the patient and that dialogue if they want to make a switch.

Yasmeen Rahimi, Piper Sandler.

Good afternoon, Robert. [Sung Gu] on for Yaz. Thanks for taking our question. For omecamtiv mecarbil, could you provide a little bit additional color on what are the rate-limiting steps or gating steps left to kick off the study?

Sure. And there are not many. Fady and the team have been working very diligently to get ready to start this study, and I'll ask him to speak to those in some detail.

I'll start and ask Stuart to elaborate. But the trial, essentially, as we've indicated before, we've had regulatory interactions. We have generally agreed on the protocol. So it's a matter of putting up the operational aspects of the trial. If you'll remember, we also use a plasma concentration assay that we have to also stand up again. So it's mostly operational at this point.

And I'll ask Stuart if he's got anything to add to that.

Just to add to that, we were really in a position where we've learned a lot, of course, from GALACTIC-HF. We had this huge database that informs the appropriate target population and optimizes study design for this new trial even further and helps us to essentially run a study that's even more efficient. And focusing on a high-risk population also needs more arranged trial. So I think we're in a good position to start in the fourth quarter.

Charles Duncan, Cantor.

Hey, Robert and team. Congrats on the good progress and recent meeting with the agency. I had a quick question on MAPLE enrollment. Yeah, it looks like it's going to be done soon. Comments from Fady, though, suggested absolutely anticipate that to be post approval. And so I guess I'm wondering if you could provide a little bit of color on what you anticipate to be the timeline to review for afi. Are you assuming a rapid review and approval or is it possible that the MAPLE results could be requested or included upon the initial NDA?

I think you might have misheard what Fady said about the timing. And his point was that we expect MAPLE results to come in prior to when we might anticipate approval of aficamten. But Fady, is there anything else you want to add?

Yeah. I think I said in my prepared remarks that we would expected in the first half of 2025. You can kind of do the math and guess to where in the first half it may land. But whether we get priority review or standard review, that still lies ahead of when we might have a potential approval. And so I would expect those data to be in the public domain but not necessarily contribute to the filing.

Now I should add there will be a safety update during our review, and we'll include blinded safety data. But that's the extent of which the MAPLE data would contribute to an NDA.

Mayank Mamtani, B. Riley Securities.

Good afternoon and thanks for taking our questions. This is actually William on for Mayank. When thinking about on, say, a non-CMI cardiac sarcomere modulator, how should we expect treatment effects to cross an of obstructive HCM patient? Or if hyper contractility is the main etiology, should we expect these to be the same or vastly different? Just to love to hear your thoughts on that.

Well, I think from a non-CMI -- I don't really know whether one exists. So we can't really speculate on how they might -- how it might address the hyper contractility in HCM. We think all of the current drugs being evaluated in clinical trials bind to myosin, and they modulate myosin's function in ways that reduce the number of active cross bridges and subsequently reduce the contractility of the sarcomere.

So they may have differences in the way -- in their exposure response relationship or other differences, obviously, that leads to different clinical profiles. But I can't really speculate on something that doesn't maybe exist.

I guess the other mechanism that's being explored or SGLT2 inhibitors in HCM. And I think there certainly is some context to believe that there is there is a potential for them to show effectiveness. I mean, we've seen SGLT2 inhibitors have promise in HFpEF, preserved ejection fraction heart failure.

But they -- in HCM -- obstructive HCM, certainly, the issue is really that gradient and reducing it. And it's not clear to me how effective an SGLT2 will be in that population as opposed to maybe nHCM that's more of a mimic and a closer approximation to the HFpEF population.

Jason Butler, Citizens JMP.

Hi, Robert. Thanks for taking the question. Just another one on the omecamtiv study. Just when we think about the targeted patient population and the positive data you've already generated, how should we think about enrollment timelines? And is there any comparison to the prior study here in terms of potential enrollment timelines?

Yeah. So I'll ask Fady and Stuart to speak to this, but we're talking about a subset of the market, but for which the event rate is especially high and for which the unmet need is not being addressed by drugs currently being studied in other clinical trials. So we foresee that this will be a study that will be embraced by investigators for which they already are telling us, they have lots of patients that meet the criteria that we're outlining.

But I'll remind you that from the advanced heart failure patients in GALACTIC were the subject of a publication. Mike Felker was the lead author. And there you can see high morbidity, high mortality, and for which the economic value there could be especially important.

So Fady and Stuart, do you want to talk about enrolling that population in a study? Stuart, why don't you go ahead.

Thanks, Robert. As Robert pointed out, we are targeting a high-risk population, and those patients have a higher unmet need. And it's also the sub-group of patients we observed in GALACTIC-HF that had a larger magnitude of treatment benefit.

So the advantage of course, is that we can run a smaller trial. We've already mentioned that the target population will be about one-fourth the size of GALACTIC-HF. And that's again because of the higher event rate that we expect. And so we can run a smaller, more lean and hopefully faster trial.

And if you sort of consider a contemporary trial such as the VICTORIA trial, then I think that's a good analogue. That trial was ran just a little over three years from first patient in to study closure. And so I think that's kind of the way we're thinking about how the study will proceed.

Sean McCutcheon, Raymond James.

Hi, guys. Thanks for the question. Can you speak to the importance of dosing optimization, specifically in the context of the 36-week, non-obstructive cohort in FOREST? Thinking about the necessity of getting patients to those higher doses maybe as a advantage you have over your competitor, what's your interpretation of how this has and potentially will impact the KCCQ results? Maybe speak to the prior KCCQ data and how it's informed your powering assumptions for ACACIA? Thanks.

Right. So firstly, I'll start by referring you back to the Coats manuscript that spoke to in his prepared remarks. And what we think SEQUOIA underscored, which was that following a principle of targeting the lowest effective dose and step-wise progression, each dose level can be associated with incrementally higher plasma-drug concentration and incremental efficacy.

And for that reason, we're especially pleased to see that we're not seeing dose discontinuations on any dose relating to low EF nor dose down titrations on the lower doses. Only when you get to higher doses, are we seeing an occasional dose down titration associated with an excursion in EF, but for which that's accompanied by larger magnitude effects on gradient. So that's the underlying therapeutic hypothesis that we think SEQUOIA answered that question very well.

As it relates to translation to nHCM -- maybe I'll ask Fady and Stuart to speak to that, please.

Well, so I think in nHCM, the hypothesis really is improving on the hyper contractility of the nHCM state. And it's a -- quite a variable population. Some patients will need more; some patients will need less. So having a drug that can be titrated quite easily and we can use a full range, if you will, of doses in order to maximize potential treatment effect in the patients, but also not have some concern potentially of overdoing it, having it back off or stop the drug and so forth, is very useful.

And the data that we saw in both the open-label extension in FOREST that I referred to that's been published as well as the published data from REDWOOD show pretty remarkable effect on symptoms, KCCQ, and biomarkers. So in designing ACACIA, we took into account what we thought would be the effect size that we observed in the Phase 2 study REDWOOD cohort for REDWOOD.

When SEQUOIA came out that helped us, if you will, solidify the fact that the placebo effect in that study was -- it was in the range that we expected because the cohort for -- in REDWOOD was not placebo-controlled. And so we took that all into account, and we think we powered it adequately with about 400 patients. Maybe I'll stop there for now.

John Gionco, Needham & Co.

Hi, Robert. This is John on for Serge today. Thanks for taking our question. We just wanted to touch on whether you guys had any updated thoughts or learnings from mavacamten launch regarding the HCM market opportunity and how you may be able to improve on their launch trajectory when the time comes for you guys. Thanks.

Thank you for the questions. So firstly, we should emphasize that we think that the Q2 sales for mavacamten addressed a lot of the lingering questions relating to the Q1 numbers. And we think that they're demonstrating exactly what one should expect from a launch of a drug that is meeting the needs of certain patients in certain centers. We think that it's an impressive -- a quarter-to-quarter growth.

With that said, as Andrew highlighted, there's still, we believe, over 90% of eligible patients who aren't receiving a cardiac myosin inhibitor. And that number will be perhaps still over 80% when we hopefully will come to market. And we do believe that the next in class profile of aficamten should be expected hopefully to be expanding the category for the benefit of more patients to be receiving benefit of cardiac myosin inhibition and from more physicians prescribing.

Perhaps I could ask Andrew to comment on what he's hearing in the marketplace and how our next-in-class profile for aficamten may hopefully deliver on market need.

So when I think about launch trajectory, clearly, it's going to be making sure that we educate cardiologists starting to engage and get broader utilization outside of centers of excellence and HCM experts, making sure we can support patients from a patient support service point of view as well as affordability. So we're really focused on all those elements to make sure that our launch trajectory is what we're expecting.

In terms of what we're hearing from the market, they certainly welcome a second option, an alternative in the CMI arena. We certainly think that's going to expand utilization of CMIs and continue to engage the community.

Rohan Mathur, Oppenheimer.

Hi, this is Rohan on for Leland Gershell. Thanks for taking my question.

Just on CK-586, are there any learnings from the aficamten studies that might inform design of the Phase 2 trial for 586 with respect to how health safety and efficacy findings might be evaluated, given that it's a greater severity of disease in HFpEF population. Thank you.

Just so I'm clear, your question relates to aficamten nHCM as informs 586 in HFpEF. Is that right?

Yes.

Fady, you or Stuart want to take that?

Yeah, Stuart, you want to go ahead and answer?

Well, the short answer is there's a lot -- we learned a lot from the aficamten program, not only in non-obstructive HCM, but of course, in obstructive HCM. But clearly the non-obstructive HCM population that is more relevant in terms of the patients with HFpEF that we're targeting, the main focus here is on improving diastolic function and essentially calibrating what we think sort of a decrease in cardiac contractility would improve that diastolic function.

And now we have some sense -- some understanding of, I'd say, the magnitude of the decrease, an ejection fraction that might confer a potential benefit in terms of diastolic function and how that would translate, of course, into symptomatic and functional improvement. And what goes along with that, of course, is what we had observed in the non-obstructive population is a very favorable safety profile that corresponds with the evidence of improved efficacy. So we'll certainly translate those observations into designing optimizing study design and targeting the populations we think that could benefit the most.

And I'm showing no further questions at this time. I would now like to turn the conference back to Robert Blum, President and CEO, for closing remarks.

Thank you, operator, and thanks to everybody for joining us on this Q2 earnings call today, an especially important call in light of some of the things we've been talking about. Given the advancement of aficamten, we're especially pleased that we've initiated the rolling submission of the NDA, and we're on track to complete that this quarter and especially coming away from the meetings we've had with FDA, that we believe inform strategy as pertains to risk mitigation and other matters that will be considered in light of the review.

We're also especially pleased that we've fortified the capital structure of the company, and that we are putting it to good use in a capital efficient way as it relates to both on the omecamtiv and CK-586. And we look forward to updating shareholders as we advance our go-to-market strategies for aficamten and also as it relates to later-stage pipeline.

With that, we'll also point to presentations later this month at the European Society of Cardiology and look forward to speaking with you after those. Operator, we can now conclude the call, please.

This concludes today's conference call. Thank you for participating. You may now disconnect.