Karyopharm Therapeutics Inc (KPTI) 2015 Q3 法說會逐字稿

Good morning. My name is Brian and I will be your conference operator today. At this time I would like to welcome everyone to the Karyopharm Therapeutics third-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, Brian, and good morning. Welcome to the third-quarter 2015 earnings call. This is Justin Renz and I am joined today by Michael Kauffman, the Chief Executive Officer of Karyopharm, who will provide a brief overview of the third quarter; Sharon Shacham, our Founder, President and Chief Scientific Officer, will provide an update on selinexor's clinical and regulatory progress and development plan; and Chris Primiano, our Senior Vice President of Corporate Development, General Counsel and Secretary.

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

Various remarks we make constitute forward-looking statements with 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 third 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 are happy to take a few questions following the prepared comments. I will now turn the call over to Dr. Michael Kauffman, Chief Executive Officer of Karyopharm.

Thank you, Justin, and good morning, everyone. Thanks for joining us today. Before I turn the call over to Sharon, I would like to make a few introductory comments.

First, we are making strong progress advancing our oncology pipeline and are more confident than ever in the clinical potential of our lead compound, selinexor, to improve outcomes for patients in a number of cancer settings.

While we have a lot going on, rest assured that we are very focused on the quality execution of the most important clinical studies that will enable selinexor to get to market. We expect data in late 2016, which if positive we will submit for regulatory approval as soon as possible.

I want to point out that our confidence is based on the broad and durable antitumor activity with adequate tolerability of oral selinexor that we have observed in both hematologic and solid tumor malignancies. This broad activity is consistent selinexor's known mechanism of action as a novel inhibitor of exportin 1 or XPO1, leading to the observed reactivation of tumor suppressor proteins and reductions in various oncoproteins.

More importantly, our confidence and drive are further heightened by the continued enthusiasm from the clinical community as we continue to evaluate selinexor's activity, including in combinations with other anticancer agents across a wide variety of difficult to treat cancers.

Between Company and investigator sponsored trials there are currently 43 active clinical studies evaluating selinexor. In fact, over 1,250 patients across various hematologic and solid tumor studies have been treated with oral selinexor.

To date 19 patients have remained on single agent selinexor for over 12 months with the longest for over two years without clinically significant cumulative toxicities or major organ dysfunction. As a result we believe selinexor's breadth of activity and novel mechanism of action provide multiple paths to late stage development and potential commercialization.

I am also pleased to report that we are continuing to enroll patients on schedule following the recent selinexor dose reduction in our Phase 2 SOPRA study in older patients with relapsed or refractory AML. We remain on track for interim data in mid-2016 and top-line data at the end of 2016. Preliminary evaluations of tolerability based on the recent dose reduction appear promising in this population of older patients with previously treated AML.

We hit another selinexor milestone this quarter with the initiation of the STOMP study, or selinexor and backbone treatments of multiple myeloma patients with support from Myeloma Canada.

In this multi-arm Phase 1B/2 clinical study we are evaluating selinexor plus low-dose dexamethasone in combination with a number of backbone therapies in the multiple myeloma setting. We believe that adding selinexor and dexamethasone to these activations will provide prolonged clinical benefit.

Selinexor and low-dose dexamethasone are already being combined with carfilzomib, or Kyprolis, in an investigator sponsored trial where promising preliminary data were presented at ASH 2014 and will be updated with additional patient data at ASH 2015.

Speaking of ASH, we look forward to presenting a range of data at the coming American Society of Hematology 2015 meeting in Orlando, Florida on December 5 through 8, including five oral presentations and 12 posters describing the role of both our SINE and PAK4 compounds in oncology.

Presentations include clinical and preclinical data demonstrating the activity of selinexor alone and in combination with other anticancer agents. Sharon will briefly discuss these in more detail.

In addition, we will present preclinical data on KPT-8602, a second generation SINE compound, and preclinical data on our first-in-class oral PAK4 Allosteric Modulator, KPT-9274. Early plea chemical development with KPT-8602 has demonstrated the potential for a SINE compound with distinct pharmaceutical properties allowing for daily dosing. Animal data are very encouraging and two oral presentations will cover this compound at ASH.

In addition to the presentations and posters at ASH, Karyopharm is hosting a special event in Orlando on Monday, December 7 at 8:00 p.m. Eastern Time in which we and key opinion leaders in the field of hematology oncology will discuss the significant potential for broadening the foundation for SINE-based therapy across multiple cancers.

In additional to Sharon and myself our guest speakers will include Dr. Andre Jakubowiak, the director of the myeloma program at the University of Chicago; Dr. Gert Ossenkoppele, Professor of Hematology at the VU University Medical Center in Amsterdam; and Dr. Jeffrey Rubnitz, Director of the leukemia lymphoma division at St. Jude's Children's Research Hospital. We expect this to be a highly engaging and informative event which will be webcast for those who cannot attend in person.

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

Thank you, Michael. I will now provide an update on our selinexor development activities and plans. Let me also emphasize a point that Michael made. While we and our clinical investigators are conducting a large number of trials, we remain extremely focused on prioritizing our most valuable and later stage trials and driving them towards successful outcome.

As Michael also mentioned, based on striking preclinical synergy in animal models of myeloma, we recently initiated the STORM trial in which we are evaluating selinexor and low dose dexamethasone in combination with other active agents in patients with previously treated multiple myeloma. We plan to report preliminary top-line data for this study in 2017.

This STOMP study complements the already ongoing investigator sponsored trial of selinexor plus carfilzomib and dexamethasone with updated results being presented at ASH by Dr. Jakubowiak. We anticipate that these studies will inform the design of randomized studies of selinexor added to the backbone therapies in multiple myeloma which would serve as the basis for full approval in multiple myeloma.

In addition, Karyopharm is actively enrolling patients in four later phase hematologic malignancies studies evaluating selinexor: one in older patients with relapsed refractory AML, SOPRA study; the second in patients with relapsed refractory DLBCL stable study; the third with selinexor in combination with dexamethasone in patients with refractory multiple myeloma, STORM study; and the fourth in patients with Richter's transformation, [third] study.

Based on our extensive Phase 1 experience with single agent selinexor, we believe 60 mgs twice-weekly is the most appropriate dose in several settings and an oral presentation supporting the selection of this does for both efficacy and tolerability in specific indications is being presented at ASH 2015.

In patients with heavily pretreated multiple myeloma in our STORM study selinexor is viewed at 80 mgs twice weekly in combination with 20 mgs of dexamethasone. In addition, we will continue to evaluate the use of 60 mgs versus 100 mgs of selinexor in our ongoing SADAL study in patients with heavily pretreated DLBCLs.

As noted previously, the SOPRA study in older patients with AML will now use the 60 mgs twice weekly dose and we look forward to reporting preliminary top-line data from this study in the fourth quarter of 2016. Moreover, our SEAL study in patients with Richter's transformation is evaluating the 60 mg dose of selinexor.

Finally, selinexor is being combined with a number of other anti-cancer agents and appropriate dose selections are being determined in ongoing Phase 1/2 studies.

On the solid tumor front, Karyopharm is currently conducting a variety of single agent and combination studies. In addition, based on promising data observed in a Phase 1 study and following an FDA meeting confirming our trial design, a randomized blinded placebo-controlled Phase 2/3 trial in liposarcoma, our SEAL study is planned to commence before the end of this year.

As Michael highlighted, there continues to be significant excitement for the investigator to assess the use of selinexor in a variety of oncology settings. So at that end a number of investigators sponsored or Company sponsored clinical trials evaluating the potential of selinexor in combination with other chemotherapy or targeted agents are currently ongoing or planned.

Of note, this past weekend preclinical data demonstrating the antitumor benefit of combining selinexor with immunotherapy in aggressive melanoma models were presented at the Society for Immunotherapy of Cancer annual meeting in Maryland.

Karyopharm researchers in collaboration with Dr. Greg Lesinski, from Ohio State University presented preclinical data demonstrating that the combination of selinexor with anti-PD-1 or anti-PD-L1 immune checkpoint inhibitors exerts considerable antitumor and immuno stimulating activity in two aggressive murine melanoma models.

Importantly, from a mechanistic perspective when added to an anti-PD-L1 antibody, selinexor increased the number of NK cells and helper (inaudible) lymphocyte and increased T cell activation or compared with anti-PD-L1 alone. Based on this encouraging preclinical data we look forward to investigating the activity of selinexor with immune checkpoint inhibitors in the clinic in the near future.

Based on promising preclinical data for KPT-8602, our second SINE compound which will be reported at Ash 2015, we have filed an investigational new drug, or IND, application with the Food and Drug Administration for KPT-8602. Pending agency review we plan to initiate clinical study with KPT-8602 in multiple myeloma in early 2016.

As Michael mentioned, we have seen some early encouraging preclinical signals with KPT-8602 indicating that it may have a tolerability profile that could potentially enable increased or more frequent dosing.

And finally, we also plan to file an IND for our oral PAK4 Allosteric Modulator, KPT-9274, and pending agency review initiate clinical development in patients with heavily pretreated solid tumors or lymphoma in the first half of 2016.

So, as you have heard, we are quite pleased with the growing interest in and progress with oral selinexor across a very broad array of malignancies. In addition, we look forward to evaluating the activity of our early stage and quality compound including KPT-8602 and KPT-9274. We look forward to continuing to provide you with updated results as they become available. Now I will turn the call back to Justin.

Thank you, Sharon. Since we issued a press release earlier today outlining our third-quarter ended September 30, 2015 financial results, I will just review the highlights, then speak to our cash balance and our financial guidance.

Karyopharm reported a net loss of $30.4 million or $0.85 per share for the quarter ended September 30, 2015. That compares with a net loss of $19.7 million or $0.61 per share for the same period in 2014. We recognized stock-based compensation expense of $3.5 million and $2.9 million for the quarters ended September 30, 2015 and 2014 respectively.

Our third-quarter net cash burn from operating activity was approximately $25.3 million. Research and development expense was $25.9 million in the third quarter of 2015 compared to $16 million for the same period in the prior year. While general and administrative expenses were $4.8 million in the third quarter of 2015 compared to $3.8 million for the third quarter of last year.

Our increase in expenditures was primarily related to the significantly expanded clinical development activities for our lead drug candidate, selinexor, KPT-330, which Sharon just highlighted. As Michael mentioned earlier, by December we expect to have over 40 actively enrolling clinical studies including 10 Phase 2s.

Cash, cash equivalents and investments as of September 30, 2015, totaled $230.2 million compared to $256 million at the end of June. We expect to end 2015 with a cash balance greater than $200 million. Based on our current operating plans we expect our existing cash will fund our R&D programs and operations well into 2018 including moving our later phase clinical studies to their next data inflection points.

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, this has clearly been a very productive period for Karyopharm. Many of the ongoing selinexor clinical studies are enrolling at a brisk rate while new studies, primarily in combination with other anticancer agents, continue to ramp up and come online.

We are looking forward to sharing additional data on our pipeline of first-in-class oncology therapeutics at the upcoming ASH meeting in early December, including selinexor activity in combination regimens across hematologic malignancies and continuing to execute against our many development goals during the remainder of the year.

To reiterate, our primary focus is to execute our most advanced studies enabling Karyopharm to commercialize selinexor while also understanding how to maximize selinexor to benefit the greatest number of patients. With that, operator, we are ready to take questions. Operator?

(Operator Instructions). Michael Schmidt, Leerink Partners.

On the AML SOPRA study I was wondering if there are any additional insights from the first 100 patients that you treated at the high-dose that [were gained] and whether you had any plans to present any of that data?

Yes, the totality of the data from SOPRA, we'll present it when the trial has completed. Given that this is potentially a registration trial, it is a randomized trial, as you know, with a survival endpoint. It is totally inappropriate and certainly not appreciated by regulators to present piecemeal data.

But we are happy very with very, very preliminary observations, we are happy with what we've seen so far with the dose reduction, and we remain on track with the timelines that we discussed during the call.

Okay, great. And then on the upcoming ASH conference, I was wondering if you had some more color on the multiple myeloma trial in particular if any -- any additional information on how many patients might be included in that data set. And also, can you remind us what the bar is for that combination in the landscape in multiple myeloma? Thank you.

Yes, as you know, there were eight patients presented in the abstract, all of whom are extremely heavily pretreated, really had gone through available agents and were refractory to proteasome inhibitors and in almost all cases quite refractory to carfilzomib in their most recent or nearly most recent therapy.

Six of those eight patients showed a response that is a PR or better, one of the patients had a minor response which means at least a 25% reduction, and one patient was not evaluable remains a denominator.

We expect to have a few more patients in this study. And assuming the data continue to show the robust and durable activity that we have seen so far, we are thinking about our plans to move ahead with such a combination in the future and we hope to update those plans at ASH.

And so, you mentioned the new I guess basket trial in multiple myeloma looking at different -- a variety of different combinations, the STOMP trial. I guess would you wait for that data to come in before looking at additional combinations? Or it sounded like (inaudible) he might be in a position to move ahead with a registration directive trial pre -- prior to results from that study coming in.

One of the underlying strategic beliefs that we have, and based on the broad activity of this drug, is that the reactivation of tumor suppressor proteins is generally applicable to nearly any combination therapy, that is we should provide at least additive and possibly synergistic activity.

Given what we have seen so far with kyprolis and assuming that those data hold up, we think this is a very compelling combination that we may move ahead with. That said, obviously we want to explore further particularly with the IMiD compounds, both Revlimid and Pomalyst, and will be looking at those. But this is -- these are additional options we believe.

We do believe that the data with proteasome inhibitors, which we have seen clinically and, by the way, is consistent with what we saw pre-clinically, is quite compelling and deserves further attention. So I don't think it will be an either/or.

Okay, great. Thank you so much.

Brian Abrahams, Jefferies.

I wanted to follow up a little bit more on sort of the multiple myeloma go forward path and prioritization. I guess I am wondering might you still expect single agent from selinexor and highly refractory myeloma patients to be a first approval based on the STORM study, perhaps expanding that out.

Or is the focus really now more on getting more information about combinations and then doing a full registrational study with any particularly promising combos?

Yes, again, I think our approach is really a dual pronged one, as you allude to. It should be clear that the STORM study would be designed if it did show sufficient activity and we don't know what that is. We don't know -- we all know what the previous bar at FDA was. This would be an initial approach in myeloma, but this would be for an accelerated approval based on the surrogate endpoint of response rate.

Either way we would still need to have a full approval strategy to confirm such an approval. And in addition, as you are all aware, Europe tends not to appreciate single arm studies terribly and generally require randomized studies.

So, we believe that combination studies in a randomized setting would serve for both full approval in US as well as in Europe. Again, STORM could serve potentially for accelerated approval here and we are continuing to press on with that study as well.

Got it. And then you mentioned some thoughts around combinations with checkpoint inhibitors in some of the preclinical data that you are seeing. And we know you are looking at Richters, I think there was some very early promising data for the PD-1s in that indication in the ASH abstracts.

Just sort of wondering where you're thinking in terms of potential checkpoint combos. Are you thinking more along the lines of solid tumor settings or might you think about some of the heme malignancies as well there?

So for the Phase 1 portion we probably will follow up in the solid tumor (inaudible) PD-1 and (inaudible) is already approved -- the PD-1 inhibitors are already approved. And then once we have the recommended Phase 2 dose of selinexor in combination with PD-1 inhibitors then we can evaluate it in a range of indications including hematological indications.

Got it. And then just one last question on 8602, it sounds like that is progressing pretty well. Just wondering if you could talk any more specifically about some of the differences there that could enable -- that you alluded to earlier that could enable a wider therapeutic window.

Is it a different manner by which it hits the target or is it more a matter of the PK/PD profile of that versus selinexor that could have differentiated clinical properties? And I will hop back in the queue, thanks.

So, we will present a lot of it at the oral presentation of 8602 at ASH. But in general 8602 is more reversible, still bioequivalent to XPO1, similar to selinexor, but is more reversible than selinexor. And in addition to that, it has lower or significantly lower brain penetration, which might allow for more frequent dosing.

Thanks.

Whitney Ijem, JPMorgan.

Thanks for taking the questions. I guess in terms of what we will see for SOPRA in the interim data versus the top-line next year, I mean will we be getting sort of efficacy and safety data in an interim look or what should we be expecting there in terms of the differences between those two readouts?

The interim analysis will include both efficacy and tolerability data, about 50% of the events in the study.

Got it. And then as we think about your cash burn guidance, I guess I assume STOMP and SEAL are included in that. As you look to bring 8602 and the PAK4 inhibitor into the clinic, I guess are those trials included or how should we be thinking about how that may change looking towards next year?

Sure. Both are included in the burn guidance for next year, yes.

Great, thanks for taking the questions.

Catherine Hu, Bank of America.

On 8602 given the improved safety profile, should we think of that as being used more in combinations going forward versus selinexor?

And then also on the R&D -- not giving guidance for next year, but should we expect a step-up next year or a lot of these new -- given a lot of these new studies are starting, or will it be pretty minimal?

And then just lastly, given you have shown some very encouraging data for the lower dose to reduce the AEs, do you think there is more room to reduce the dose particularly when using combination regimen? Thanks.

So, hi, Catherine, Justin, I will speak to the guidance first. So, our R&D expenditure estimates for 2016 will be slightly less than 2015. In 2015, as we have just discussed today, we had a lot of activities in terms of getting studies up and running as well as we put some of our treasure towards CMC and those costs will all be reduced in 2016.

So, we will be able to accommodate getting 9274 and 8602 going well in 2016 as well as continuing the various clinical studies of selinexor with an overall reduced burn.

Great. The dosing -- we'll let Sharon just briefly discuss it, but this will be covered at ASH in an oral presentation.

So we have an oral presentation at ASH about the recommended Phase 2 dosing and we will present a lot of data there to show that the dose of selinexor single agent is 60 mg and it has optimal tolerability as well as efficacy. In combination we are evaluating a range of doses, usually at 60 mg or just below it and some of these are already reported at ASH and more will be reported in future meetings.

And then lastly, the question on 8602, just to caution -- let's not get too far ahead of ourselves. We don't have any data yet in humans. So we will have to wait and see how that profile of the drug plays out, whether the reverse -- slightly improved reversibility or more reversibility will have any effect on efficacy or not. And then the tolerability around the blood brain barrier.

So we will assess this. We chose multiple myeloma because the readout is so quick. And then we will be able to plan for how we use selinexor and then 8602 in different indications. So we will have to wait on that.

Great, thanks much.

(Operator Instructions). Michael King, JMP Securities.

Apologize if these -- if you addressed these in the formal remarks; I have been kind of hopping on to a bunch of different calls this morning. But, two questions. First is just on PAK4, when do you expect to have the first molecule in humans?

And then I want to say it was yesterday at the triple meeting, John Byrd from Ohio State talked about -- I guess it is an IST that is looking at selinexor in combination with ibrutinib. And I just wonder if you might address the goals and expectations for that study? Thanks.

So, for your second question, this is a study, the study that John Byrd referred to as an investigator sponsored study that is being conducted at Ohio State and in Utah and it is looking at a combination of selinexor with ibrutinib.

We will evaluate in two different populations, in CLL and separately in patients with non-Hodgkin's lymphoma. The goal will be to identify a recommended Phase 2 dose for selinexor and then to do an expansion on both -- in both indications.

Would these be high risk patients in CLL, Sharon?

You can imagine that most of the patients -- some of these patients -- these patients have not then fitted with ibrutinib before. So they are coming at a relevant early stage and we are not separating high risk to not high risk in the dose escalation part of the study.

In the expansion we will of course characterize all of them and we will look at the activity of selinexor in high-risk patients and not.

And then PAK4?

Can you remind me the questions (multiple speakers)?

Well, I thought (multiple speakers) would be first in humans on PAK4.

It will be towards the end of Q1/early Q2. This is when we are planning to initiate the Phase 1 study in patients with solid tumors and lymphoma, or lymphoma.

Okay, great, thanks for taking the question.

Thank you, there are no additional questions. I will now turn the call back to Dr. Michael Kauffman, Chief Executive Officer of Karyopharm, for closing comments.

Thank you very much. Again, we appreciate everybody's time this morning and that concludes our 2015 third-quarter conference call. Have a good day, everyone.

Ladies and gentlemen, this does conclude today's program. You may all disconnect. Everybody have a wonderful day.