Karyopharm Therapeutics Inc (KPTI) 2015 Q2 法說會逐字稿

Good morning. My name is Sabrina and I will be your conference operator today. At this time I would like to welcome everyone to the Karyopharm Therapeutics second-quarter 2015 financial results conference call. Mr. Justin Renz, Executive Vice President, Chief Financial Officer and Treasurer of Karyopharm Therapeutics, please begin your conference.

Thank you and good morning. Welcome to the second-quarter 2015 earnings call. This is Justin Renz and I'm joined today by Dr. Michael Kauffman, the Chief Executive Officer of Karyopharm, who will provide a brief overview of the second quarter,

Dr. Sharon Shacham, our Founder, President, and Chief Scientific Officer, who provide an update on selinexor's clinical and regulatory progress and development plans, and Chris Primiano, our Vice President of Corporate Development, General Counsel, and Secretary.

Earlier today we issued a press release detailing Karyopharm's results for the quarter ended June 30, 2015. The release is available on our website at Karyopharm.com.

Various remarks we make constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements about our future expectations, clinical developments, and regulatory timelines, the potential success of our product candidates, financial projections, and our plans and prospects.

Actual results may differ materially from those indicated by these statements as a result of various important factors, including those discussed in the Risk Factors section of our Quarterly Report on form 10-Q for the second quarter of 2015, which is on file with the SEC as of this morning, and any other filings we may make with the SEC.

Any forward-looking statements represent our views as of today only. We may update these statements in the future but we disclaim any obligation to do so. Therefore, you should not rely on these forward-looking statements as representing our views as of any date subsequent to today.

We're happy to take a few questions following our prepared comments. I will now turn the call over to Doctor Michael Kauffman.

Thank you, Justin, and good morning. This is Michael Kauffman, the Chief Executive Officer of Karyopharm.

Before I turn the call over to Sharon, I would like to make a few introductory comments.

First, I'm delighted with the progress we're making with selinexor since it first entered the clinic three years ago. We, and a growing number of enthusiastic physicians, are learning a great deal about selinexor's activity across a wide variety of difficult to treat cancers.

In addition, we and the investigators are learning ways to optimize the dose, schedule, and side effects of selinexor across this broad array of tumors which have permitted some patients to remain on selinexor for over a year, the longest now for more than two years.

The breadth and durability of selinexor's anticancer activity support the broad applicability of nuclear export inhibition for the treatment of neoplastic diseases.

We presented data describing the clinical benefit of selinexor across multiple solid and hematologic malignancies at some of the most significant medical conferences in the field of oncology this quarter including the American Society of Clinical Oncology or ASCO, the annual meeting of the European Hematology Association, or EHA, and the international conference on malignant lymphoma or ICML. Sharon will go through the content and importance of these data in more detail as well as provide an update on our clinical progress as we continue to execute our selinexor development plan.

We selected four hematological malignancies with high unmet medical need for further study, based on response rates and durability observed in our Phase 1 studies. We've recently initiated enrollment in the fourth of these trials called STORM, a Phase 2 study in patients with quad refractory multiple myeloma and we're making steady progress in enrolling patients in three other trials including SOPRA, an acute myeloid leukemia or AML, SADAL, in diffuse large B cell lymphoma or DLBCL, and SIRRT in Richter's Transformation.

In the fourth quarter of 2016, we look forward to reporting preliminary topline data from SOPRA, SADAL, and SIRRT, with interim data on STORM in mid-2016. We continued to observe good clinical activity in these indications and we are making important adjustments to some of our early and later phase trials based upon our continued learning on how to optimize selinexor dosing across different tumor types.

Sharon will provide additional detail in a moment, but we're now adjusting the selinexor dosing in our SOPRA study, a Phase 2b randomized clinical trial of single-engine oral selinexor versus physicians' choice in older patients with relapsed or refractory AML where overall survival is the primary endpoint.

In particular, we're reducing the dose in SOPRA by approximately 35% from 55 milligrams per meter squared previously now to a fixed dose of 60 milligrams, which corresponds to approximately 35 milligrams per meter squared. Dosing will remain twice-weekly and the topline data are now expected in Q4 2016 with interim data in mid 2016.

Sharon will also be providing details of our plans to move forward with a Phase 2-3 study in patients with liposarcoma. We remain the only clinical stage XPO1 inhibitor and we are gaining a growing understanding of how to optimize the activity of oral selinexor across a variety of cancer indications.

I also want to highlight that we are making progress with our pipeline beyond selinexor. We have been granted a US patent for KPT-350, an oral sign compound being developed for the treatment of inflammatory and autoimmune seasons. This patent, which will expire in 2032, covers the composition of matter for TPG 350 as well as certain other compositions and related metrics.

We've also been granted a US patent for certain SINE compounds, including selinexor and KPT-335, which is also known as [vertinexor]. This patent, which will expire in 2032, includes methods for treating viral infections, inflammatory disorders, as well as cancer.

I now turn the call over to Doctor Sharon Shacham to provide an update on our clinical development plans for selinexor and our other SINE compounds. Sharon?

Thank you, Michael. I will now provide you with a little update of our clinical development plans for selinexor.

To date, over 1,000 patients across various hematologic and solid tumor, Karyopharm and investigator-sponsored studies have been treated with oral selinexor. As Michael mentioned, several patients have remained on single agent selinexor over 12 months and the longest for over two years. We continue to observe broad endurable antitumor activity of selinexor in both hematologic and solid tumor cancers consistent with selinexor's known mechanism of action in the novel inhibitor of exportin 1, also called XPO1.

Selinexor's breadth of activity and novel mechanism of action provides multiple paths to late stage development and potential commercialization. Between Company and investigator-sponsored trials, there are currently 43 clinical studies listed on clinical trials [ongoing] related to selinexor. We presented highlights from some of the studies with selinexor, both of single agent and in combination in several medical consensus during the quarter, and we have submitted abstract for other during the ongoing remainder of the year, including the American Society for Hematology or ASH 2016 annual meeting in December.

I will now provide an update on selinexor development activities in three respects. First in hematological malignancies, second in solid tumors, and third in combination studies that we do not cover elsewhere in this discussion.

In hematologic malignancies, we are actively involving patients in four late stage clinical trials of selinexor. The first trial, called SOPRA, or Selinexor in Older Patients with Relapsed/Refractory AML is enrolling patients older than 60 years of age who have received one prior line of therapy and who are ineligible for intensive chemotherapy and transplantation.

The second trial is called SADAL for Selinexor Against Diffused Aggressive Lymphoma. It's enrolling patients with relapsed/refractory DLBCL.

And the third trial, called SIRRT is for Selinexor in Initial and Relapsed/ Refractory Richter's Transformation. Preliminary topline data from this study is anticipated in the second half of 2016.

As Michael highlighted, we are continuing to learn how to most effectively manage selinexor. In particular, about one year ago we initiated our Phase 2 SOPRA study in older patients with relapsed refractory AML who are ineligible for intensive chemotherapy and transplantation.

We chose a selinexor dose of 55 milligrams per meter squared which caused corresponds to about 100 milligrams in most patients. The fifth dose was a maximum tolerated dose in the AML [culled] of our phase 1 clinical trial in hematological malignancies.

In July 2015, we amended SOPRA to reduce the dose from 55 milligrams per meter squared to a 6 dose of 60 milligrams which corresponds to approximately 35 milligrams, a reduction of approximately 35%. Dosing will remain twice-weekly. This change was implemented based on ongoing safety and tolerability evaluation in the SOPRA study as well as maturing data from the AML patients in the Phase 1 first [in humans] clinical trial of selinexor.

The SOPRA study uses a 2 to 1 randomization of AML patients to either selinexor or physicians' choice. This does adjustment has been implemented based on ongoing data from the SOPRA study itself as well as maturing data from the ongoing Phase 1 study of selinexor and patients with AML.

In the SOPRA study, as of the end of July 2015, there have been eight reports of sepsis in seven patients receiving 55 milligrams per meter squared of selinexor as compared with two reports of sepsis in two patients receiving physician choice. Given the 2 to 1 randomization, we would expect to see twice as many cases of sepsis on the selinexor arm, compared with the physician choice arm.

However, although the numbers are small and sepsis is often observed in patients with AML, the incidence of sepsis in these elderly AML patients appears to be higher than that of the control arm in the patients receiving selinexor.

In contrast, there were 17 cases of febrile neutropenia on the selinexor arm versus nine on the control arm. That is similar rates. In addition, with our Phase 1 data arm maturing and apparent increase in incidence of sepsis in patients receiving doses of selinexor -- at high doses given twice-weekly with relapsed or refractory AML was noted in our Phase 1 clinical trial in hematological malignancies.

Importantly, this increased risk was not observed in patients with other hematological malignancies all with solid tumors and is thus far only observed in elderly AML cases.

Furthermore, doses of selinexor at 60 milligrams twice-weekly were not associated with any increase in sepsis or other infection-related events in patients with heavily treated AML in the Phase 1 study.

Finally, the majority of the patients with AML in the Phase 1 study, who showed a response to selinexor treatment, including patients with complete remission received selinexor at doses of approximately 60 milligrams or below. As a result of the change in dose, the SOPRA study will now have an interim assessment in May 2016 with topline data expected in the fourth quarter of 2016.

Because we have apparent increased risk of sepsis at high doses of selinexor, we are restricted to the AML cohort of course our Phase 1 studies, we are continuing to treat patients with both 100 milligrams and 60 milligrams doses of selinexor in our SADAL study in patients with relapsed or refractory DLBCL. This study is ongoing and enrolling topline data continue to be expected in the fourth quarter of 2016.

In July 2015 we amended the protocol SIRRT, a Phase 2 clinical study of single agent oral selinexor in patients with Richter's Transformation, an aggressive form of lymphoma, to include patients with newly diagnosed Richter's Transformation. There is no standard of care for patients with Richter's Transformation and these patients have an extremely poor prognosis.

As a result of these factors and in order to improve patient accruals, in consultation with key opinion leaders in the area, we determined that there was a compelling rationale to amend the SIRRT protocol to also include patients who are not yet received chemotherapy to treat Richter's Transformation.

We are now implementing the revised protocol across SIRRT study sites in the United States and Europe. And doses in selinexor in SIRRT continues to be 60 milligrams twice-weekly and haves not been altered.

In addition to the studies previously mentioned, we have initiated a single arm phase 2 study in patients with quad-refractory multiple myeloma called STORM, a selinexor treatment of refractory myeloma, based on previously reported oncology data in heavily pretreated patients with multiple myeloma and in consultation with key opinion leaders. The study will initially enroll 80 patients whose myeloma is refractory to bortezomib, carfilzomib, lenalidomide, and pomalidomide.

In addition, about 25% of the patients will have myeloma refractory to an anti-CD38 monoclonal antibody such as daratumumab. Selinexor is being dosed at 80 milligrams twice-weekly, equivalent to about 45 milligrams per meter squared along with 20 milligrams of dexamethasone, given with each dose of selinexor. If the data from those 80 patients are promising, we may expand the size of the study for a potential submission to regulatory authorities. We plan to present the initial data on these patients in the middle of 2016.

We are trying to initiate a global clinical study to evaluate a combination of selinexor with dexamethasone with backbone therapies including bortezomib, pomalidomide, or lenalidomide in patients with multiple myeloma. The study will be divided into two phases.

The first phase will be conducted to determine the maximum tolerated dose of selinexor when combined with these therapies. The safety of selinexor will also be evaluated when given orally once weekly, or twice weekly. Once the recommended phase 2 dose is established, an expansion phase will begin in which additional patients for each treatment arm will be involved.

Similarly, we plan to initiate the study of selinexor in combination with rituximab with backbone therapies in patients with DLBCL after multiple relapse by the end of 2015. These backbone therapies include gemcitabine plus oxaliplatin, then domascin, oral lietoposide, lenalidomide, and [nintedanib]. What's the recommended Phase 2 dose of the most active conversation is identified, it will be carried into an expansion phase in patients with heavily treated DLBCL.

As Michael mentioned, our enthusiasm for initiating this study with selinexor in hematological malignancies is supported by selinexor's extensive clinical activity which has been presented at multiple medical meetings in the past several months. For example we presented clinical data further supporting selinexor's potential benefit in the treatment of hematologic malignancies, including (technical difficulty) selinexor's single agent and in combination with chemotherapy in DLBCL and AML at a recent 20th Congress of the European Hematology Association.

This data includes updated survival data from an ongoing Phase 1B clinical trial of single agent selinexor in heavily treated patients. In this study that was DLBCL patients who responded the selinexor demonstrated a median overall survival of greater than 10 months with a median that was not yet reached in progression-free survival of 24 months. Significantly longer than the 27 DLBCL patients who did not achieve a response with an overall survival of 3.5 months in progression-free survival of 1.2 months.

At the same meeting, preliminary Phase 2 results from an ongoing clinical trial of selinexor in combination with chemotherapy regimen of (inaudible) [rubecin] and ROC in 18 invaluable patients with relapsed or refractory AML demonstrated a 56 overall response rate including nine patients with complete remission and one patient with partial remission.

This preliminary data for selinexor in combination with a very intensive chemotherapy regimen suggests that selinexor will be combinable with a variety of other anticancer agents. We also presented clinical and preclinical data from an ongoing Phase 1 clinical trial with single agent selinexor in DLBCL patients with mixed BCL2 and OBSBCL [six translocation] at the 13th International Conference on malignant lymphoma or ICML.

DLBCL with these translocations represent an area of significant unmet medical need associated with poor prognosis and limited standard of care treatment options.

In this study, 14 relapsed refractory DLBCL patients with triple, double, or single hit milligram BCL two and/or BCL six translocations demonstrated clinically meaningful activity with a 43% overall response rate, meaning a partial response of better including two completed responses, four partial responses, and two additional patients achieving stable disease.

Preclinical data was also presented at ICML and demonstrated selinexor's potency in double DLBCL cell line in vitro and in an aggressive device [xenograph] model of triple ADLBCL with 84% tumor growth inhibition.

On the solid tumor front, we are very pleased to report that we recently met with the FDA concerning development of selinexor and liposarcoma, a particularly difficult to treat cancer with a very limited therapeutic option. Based on the encouraging data we presented at ASCO -- in patients with relapsed progressive liposarcoma, which I will describe in a moment, we are planning to initiate a Phase 2-3 study of single agent selinexor versus placebo to treat liposarcoma in the second half of 2015. This trial will utilize a progression-free survival primary endpoint.

In addition, as you know, Karyopharm is actively enrolling patients in the three selinexor Phase 2 solid tumor studies. The first trial, our SIGN study, is in gynecologic malignancies. The second trial, our KING study, is in glioblastoma multi-forma, and the third trial, our SHIP study, is in metastatic prostate cancer.

Preliminary data from SIGN and KING studies were presented at ASCO this year and we will summarize this data shortly. Our fourth Phase 2 solid tumor study in those patients with relapsed or refractory squamous cell tumors. Enrollment to the head and neck [core] of these studies has been completed and due to slower accrual in the lung and esophageal squamous carcinoma cohorts, we're terminating further enrollment to these arms and finalizing the studies.

Additional trials in selinexor in combination with various chemotherapies are ongoing and will include patients with squamous cell carcinoma.

We presented formative clinical data with single agent oral selinexor in an ongoing Phase 2 and Phase 1B clinical study across multiple solid tumors at the most recent ASCO annual meeting including antitumor activity in disease control in patients with recurrent glioblastoma, advanced sarcomas, heavily pretreated gynecological cancers, and across multiple malignancies in aging patients.

Highlights of these data include in patients with recurring glioblastoma, we reported antitumor activity and [brain penetration] at clinically relevant drug labels. With a [30%] overall response rate and a 438 percentage control rate. In patients with advanced sarcoma, including liposarcoma, we reported durable anticancer activity, including longer progression-free survival the last bioregimen. Median (inaudible) was 136 days compared with 54 days on the last bioregimen.

In heavily treated ovarian endometrial and cervical cancer, we reported promising antitumor activity or disease control of course with disease control rate of up to 62% in several patients remaining on study for up to 12 months. And antitumor activity in a Phase 1 study evaluating selinexor across a variety of advanced malignancies in aging patients.

In terms of combination studies, there are currently a number of investigator-sponsored and Company-sponsored trials, ongoing or planned, evaluating the potential of selinexor in combination with other chemotherapy or targeted agents in both hematologic and solid tumor cancers.

In addition to the studies we discussed earlier, some of the key selinexor combination studies with preliminary data expected with the next year include the following. Carfilzomib and dexamethasone in multiple myeloma where a preliminary clinical evidence of combination. Antitumor activity was presented at last year's annual meeting of the American Society of Hematology.

Bortezomib and dexamethasone in multiple myeloma in constant induction has already begun. In addition, a study of selinexor in combination with bortezomib and dexamethasone in patients with at least one prior therapy whose myeloma is not refractory to bortezomib is expected to begin in the second half of 2015.

Gemcitabine in AML which began in 2014 and carboplatin and paclitaxel in patients with relapsed or refractory ovarian or endometrial cancers which has initiated enrollment. Other additional combination studies in both solid and hematologic malignancies have commenced or will begin shortly. A full list of ongoing impending studies is available at clinical trials (inaudible).

In conclusion, we are quite pleased with the interest in and progress with selinexor across a very broad area of malignancies. Our program is now moving to include combination studies with the associated anticancer agents, both of which are based on strong [cosmetic] mechanisms and [xenograph] support. We look forward to continuing to provide you with updated results as they become available.

Now I'll turn the call over to Justin.

Thank you, Sharon. Since we issued a press release earlier today outlining our second quarter ending June 30, 2015 financial results, I'll just review the highlights and then speak to our cash balance in our financial guidance.

Karyopharm reported a net loss of $32.7 million or $0.92 per share for the quarter ended June 30, 2015. That compares with a net loss of $16.4 million or $0.55 per share for the same period in 2014.

We recognized stock-based compensation expense of $4.5 million and $3.9 million or quarters ending June 30, 2015 and 2014, respectively. Our second-quarter net cash burn from operating activities was approximately $28.2 million.

Research and development expense was $27 million in the second quarter of 2015 compared to $13.2 million for the same period in prior year, while general and administrative expenses were $6.2 million in the second quarter of 2015 compared to $3.3 million from the second quarter of last year. This increase in expenses is primarily related to the significantly expanded clinical development activities for our lead drug candidate, selinexor, which Sharon just highlighted in the increase in general and administrative expenses resulting primarily from an increase in personnel costs including headcount in stock-based compensation expenses, along with the additional cost of operating as a public company.

Cash and cash equivalents and investments as of June 30 totaled $256 million compared to $285.3 million as of March 31.

Based on our current operating plans, we expect our cash flow from our R&D programs and operations into 2018 including moving our later phase clinical studies to their next data inflection points. We expect to end 2015 with a cash balance greater than $200 million.

I will now turn the call back over to Michael to provide a brief summary before we take some questions.

Thank you, Justin.

In summary, we continue to make strong progress evaluating the vast potential of XPO1 inhibition as our aggressive selinexor development program continues in 2015 and beyond. After demonstrating the single agent activity of selinexor in solid tumors at ASCO in June, we have submitted a number of abstracts for consideration to the American Society of Hematology which is holding its annual meeting in Orlando Florida later this year.

There, we look forward to sharing with you the breath, depth, and combined ability of selinexor in difficult to treat hematological indications.

With that, operator, we are ready to take questions. Operator?

(Operator Instructions) Mike King, JMP Securities.

I had a few, so I will just try to keep it to the most pertinent. I would love a little bit more elaboration if you could on AML just as far as the level of neutropenia upon enrollment in these patients. Is it comparable to the other levels of neutropenia in your other hematologic malignancy trials? Or does it have anything to do with prior therapy, etc.? Any clues that you might help us with -- understand where the subsidy increase in sepsis is coming in this population versus any of your other patient populations?

Patients with AML, especially elderly AML, has significant higher numbers of numbers of sepsis. They are very sensitive to both sepsis and febrile neutropenia that we mentioned as well as other infections.

We analyzed all the data and based on our data from SOPRA study, the level of other infections as well as febrile neutropenia is similar between selinexor and the physician choice arm. However as we mentioned in the studies in the rate of incidence of sepsis was higher on the selinexor arm versus physician choice and this was selective to sepsis and not to other types of infection. When we analyze the doses it seems -- based on the Phase 1 data, essentially as this occurs only at doses that -- only at high doses, around 100 milligrams or 55 milligrams per meter squared.

Right, I got that. But is this because those higher doses are creating greater levels of neutropenia or what is the --? What is the putative trigger for that?

Yes, just to clarify, patients with AML unlike the patients on our other studies come in with grade 3 or 4 neutropenia. Many of them have almost no normal neutrophils. They have blasts which are not effective against infection so essentially everyone coming into any AML study has almost no functioning normal neutrophils. So they start off with neutropenia.

As you noted, the febrile neutropenia rates on both arms were the same. Selinexor is fairly selective for leukemic blasts over normal neutrophils but if you have no normal neutrophils it's not going to matter. So (multiple speakers)

These are patients that are normally prophylax as well as with antibiotics, right, Michael?

Yes. And so sampling the sale study as reported at the last EHA in patients -- and these are inpatients in with relapsed or refractory AML, when we treated selinexor even with high-dose chemotherapy, we didn't see an increase in sepsis based on the small number of patients in the study.

Okay. All right, switching very quickly to sarcoma, Sharon, you said in the formal remarks that the endpoint is going to be PFS. Can you say anything about -- I assume these are patients that are going to come in previously untreated or will they have had some prior docs or some other active agent? And maybe tell us about the size of the study if you can and what expected PFS might be.

So the population of the study will be patients with liposarcoma with one prior therapy or more. In terms of the PFS, we expect about three months' improvement in PFS in patients with selinexor versus placebo.

And the placebo PFS would be expected to be what roughly?

Around two months.

Oh, okay.

Two to three months. The cycle in this study will be six weeks, so scans will be happening around every six weeks.

And the number of patients you expect to enroll?

It's about 200. Randomization will be 2 to 1 on selinexor versus placebo and we will allow crossover from placebo to selinexor.

You will allow crossover?

Yes.

Okay. Thanks for taking the questions.

Michael Schmidt, Leerink Partners.

Hi. It's Jonathan Chang standing in for Michael Schmidt. Thanks for taking my question.

I'm curious as to -- could you talk about your confidence in the 16 milligram fixed dosing and AML? And also your experience with a 16 milligram fixed dose across other indications?

Sure. Actually now we have evaluated 60 milligrams and it is the dose that we're using in the majority of our studies. We evaluated a level of the other side effects as well -- such as anorexia, fatigue, and nausea at 60 milligrams and responded to be a very tolerated dose while maintaining efficacy rates when we look at the accumulating data in both solid tumors and hematological malignancies.

Specifically in AML, both in the patients -- the small number of patients in the SOPRA study that we see 60 milligrams as well as data from the phase 1 study, we didn't see an increase in sepsis rate at this dose.

All right, thank you. And I think you mentioned this before but I might've missed it but can you remind me? Was there any sepsis observed in the AML combination study presented at EHA and what the dosing regimen was there?

The [sales] study which is the only study combination that we published so far, we used selinexor in combination with 7 and 3. The dose of selinexor was 30 milligrams per meter squared and there was no -- it's a small dose. Small number of patients that we published at [EI] if this was an interim analysis. But in the small number of patients, we didn't see an increase in sepsis rate.

And just as a reminder, these are end patients. All are treated prophylactic with antibiotics, antifungal, and other.

Great, thanks. And maybe just one last one. I'm curious to know when the sepsis occurred during the course of treatment?

So, it's a very good question, Michael. When we looked at the data, it can happen very early as you can expect in elderly patients with relapsed AML or it can happen in cycle 2, cycle 3, and so on. So there wasn't specific timing of the sepsis.

All right, thank you very much.

Arlinda Lee, MLV.

I -- actually on the ASH data that you guys presented -- have submitted abstracts for, can you maybe comment on what kind of durability response data you will have and tolerability? Particularly for AML. And if you have additional information on the sepsis -- anything at all that you guys are seeing there? Thank you.

Arlinda, I guess you will have to wait a month or two until the abstract at the ASH will be available in two or three months. We can't disclose this at this point as the abstract were neither abstract -- we don't know if they were accepted or not.

Okay. Will we be seeing information -- additional information on the sepsis, even though --?

At the upcoming ASH, there is no update on SOPRA study specifically. There was the update other ASPs and they will include both safety and durability.

Great, thank you.

Thank you. I'm showing no further questions at this time.

Thank you very much, operator. With that, we will close the call. This concludes our second-quarter 2015 conference call and thank you for participating, and we will speak with you soon.

Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may all disconnect. Everyone have a great day.