Karyopharm Therapeutics Inc (KPTI) 2019 Q1 法說會逐字稿

Good morning. My name is Gigi, and I will be your conference operator today. At this time, I would like to welcome everyone to the Karyopharm Therapeutics First Quarter 2019 Financial Results Conference Call. (Operator Instructions) Please be advised that this call is being recorded at the company's request.

I would now like to turn the call over to Mr. Ian Karp, Karyopharm's Vice President, Investor and Public Relations.

Thank you, Gigi, and thank you all for joining us on today's conference call to discuss Karyopharm's First Quarter 2019 Financial Results and Business Update. This is Ian Karp, and I'm joined today by Dr. Michael Kauffman, our Chief Executive Officer; Mr. Mike Mason, Chief Financial Officer; Mr. Christopher Primiano, Chief Business Officer and General Counsel; and Mr. Anand Varadan, our Chief Commercial Officer.

On the call today, Michael Kauffman will provide an overview of some of our recent corporate developments. Then Mike Mason will provide an overview of the first quarter 2019 financial results. Dr. Kauffman will then discuss our key upcoming milestones and provide some summary remarks. We will then open up the call for your questions.

Earlier this morning, we issued a press release detailing Karyopharm's results for the first quarter of 2019. The release is available on our website at karyopharm.com.

Before we make our formal comments, I'll remind you that various remarks we will make today constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. These include statements about our future expectations, clinical developments and regulatory matters and time lines, the potential success of our product candidates, financial projections, and our plans and prospects.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our most recent annual report on Form 10-K, which is on file with the SEC and in other filings that we may make with the SEC in the future.

Any forward-looking statements represent our views as of today only. While we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views change. Therefore, you should not rely on these forward-looking statements as representing our views as of any date subsequent to today.

In addition, please note that any references we make to clinical trial data during today's discussion refer to interim unaudited site data, unless otherwise specified.

I'll now turn the call over to Dr. Michael Kauffman, Chief Executive Officer.

Thank you, Ian, and good morning, everyone. Thank you for joining us on today's call. I will begin with a quick overview of recent company events and developments. First, in mid-March, the FDA extended the PDUFA action date for the selinexor New Drug Application by 3 months to July 6, 2019. This extension followed the FDA oncologic drug advisory committee meeting that was convened on February 26 to review data supporting our NDA, requesting accelerated approval for oral selinexor in combination with low-dose dexamethasone for patients based on the results of the single-arm Phase IIb STORM study.

At the conclusion of the ODAC meeting, in a vote of 8 to 5, the committee recommended that the FDA wait for the results from Karyopharm's randomized open-label Phase III BOSTON study, evaluating selinexor in patients with previously treated myeloma before making a final decision regarding approval.

After the conclusion of the ODAC meeting, Karyopharm continued to have productive discussions with the FDA regarding the selinexor New Drug Application.

At the request of the FDA, Karyopharm submitted additional existing clinical information as an amendment to the NDA.

Following a review of these additional data, the FDA extended the PDUFA action date by 3 months. Since then, we've been working closely with FDA as they complete their review of the selinexor New Drug Application, and we remain deeply committed to bringing selinexor into the hands of physicians treating patients with refractory multiple myeloma.

While the FDA will consider the recommendations of the advisory committee, the final decision regarding approval of the product is made solely by the agency, and the recommendations of the advisory committee are nonbinding.

As a reminder, the BOSTON study, which was fully enrolled this past January, is evaluating selinexor in combination with Velcade, also known as bortezomib and dexamethasone, compared to Velcade and dexamethasone alone in patients with myeloma who have had 1 to 3 prior lines of therapy.

As progression-free survival is the primary endpoint, we expect to have top line results from that study by the end of 2019 or into 2020, depending on the occurrence of the progression.

In a recent meeting of the data safety monitoring board, no new safety signals were identified on the study, and based on the first interim analysis, the board recommended proceeding with the study as originally planned with no changes in patient numbers.

As we now await the conclusion of the FDA's review, we've also been very active in preparing for the potential commercial launch of selinexor in the United States.

In January, we hired our commercial sales force of approximately 60 sales representatives and 8 nurse liaisons. Should selinexor receive FDA approval by the updated July 6 PDUFA date, our commercial team will be in an excellent position to support a successful United States launch.

In parallel to the U.S. activities, we announced in early January that we have submitted a marketing authorization application to the European Medicines Agency, requesting conditional approval for selinexor in the same triple-class refractory myeloma indication as in the United States.

As a customary part of the marketing application review process, we received a consolidated list of questions from the EMA in early May 2019. To provide adequate time to evaluate the application and allow us to respond to the questions and feedback, the EMA has switched the application from an accelerated review to a traditional review. We expect to receive a decision on the application by the end of 2019.

Shifting gears now to our selinexor development programs beyond myeloma.

For diffuse large B-cell lymphoma following a presentation of positive top line results from the Phase IIb SADAL study at ASH 2018, and the receipt of Fast Track designation from the FDA during the fourth quarter of 2018, we are now working towards a New Drug Application and marketing authorization application submissions requiring accelerated and conditional approvals -- requesting accelerated and conditional approvals, respectively, for patients with relapsed to refractory DLBCL who've received at least 2 prior multi-agent therapies and who are ineligible for stem cell transplantation, including CAR-T therapies.

We are working with both the FDA and EMA to determine the appropriate timelines for these submissions and expect to have some greater clarity, following the FDA's decision on our New Drug Application requesting accelerated approval for oral selinexor in myeloma.

Next, I'd like to discuss some recent developments for our selinexor program in endometrial cancer, where there are currently no approved therapies for the treatment of patients in the maintenance setting following initial chemotherapy.

During the first quarter, an investigational New Drug Application was submitted and accepted by the FDA for a randomized, blinded Phase II/III study, titled the SIENDO study, evaluating selinexor versus placebo as a maintenance therapy in patients with advanced or recurring endometrial cancer following their initial platinum-based treatments. The primary endpoint in the SIENDO study is progression-free survival. This study was previously an investigator sponsored trial and has subsequently transitioned to a company-sponsored study.

We are targeting complete enrollment in this study in 2020.

We have also seen further progress across a number of additional clinical programs. Two selinexor abstracts have been selected for presentation at the upcoming American Society of Clinical Oncology or ASCO meeting 2019 in late May and early June in Chicago. The first will be an oral presentation describing results from the Phase II KING study evaluating single-agent selinexor in patients with recurrent glioblastoma. And the second will be a poster presentation with discussion describing additional overall survival from the STORM study in patients with heavily pretreated myeloma.

And finally, on the corporate front, we recently appointed Tina Clark Beamon as Chief Compliance Officer. Tina formerly served as Executive Director of Compliance and Ethics at Alexion Pharmaceuticals. She brings to the company 21 years of healthcare industry experience, and her appointment reflects our ongoing commitment to maintaining the highest compliance and ethics standards as we transition to a commercial state organization.

With that, I'll now turn the call over to Mike Mason for an overview of the first quarter financials. Mike?

Thank you, Michael. Since we issued a press release earlier today with the full financial results, I will just focus on some highlights.

As of March 31, 2019, cash, cash equivalents and investments, including restricted cash, totaled $265.1 million compared to $330.9 million as of December 31, 2018.

For the first quarter of 2019, license and other revenue was $0.2 million compared to $10 million for the first quarter of 2018.

The revenue in 2018 was from the $10 million upfront payment for the asset sale of KPT-350 to Biogen in the first quarter of 2018.

For the first quarter of 2019, research and development expense was $38 million compared to $41.3 million for the first quarter of 2018. We expect R&D expense to decrease going forward in 2019 compared to the first quarter of 2019, largely due to reduced spend from the BOSTON and SADAL trials.

General and administrative expense for the first quarter of 2019 was $27.1 million compared to $7.6 million for the first quarter of 2018. The increase was due primarily to the hiring of the Karyopharm commercial team and related commercial launch preparation activities to support the potential U.S. commercial launch of selinexor.

Assuming a commercial launch by July, we expect G&A expenses for the remainder of 2019 on a quarterly basis to be relatively consistent with Q1 2019.

For the first quarter of 2019, we reported a net loss of $66.2 million or $1.09 per share compared to a net loss of $38.5 million or $0.78 per share for the first quarter of 2018.

Net loss includes stock-based compensation expense of $3.9 million and $4.2 million for the first quarters of 2019 and 2018, respectively.

Based on current operating plans, which assume a selinexor commercial launch by July 2019, we expect our full year operating expense to be between $200 million and $250 million, excluding stock-based compensation.

Additionally, we expect our existing cash, cash equivalents and investments will be sufficient to fund operations into the second half of 2020.

If the FDA decides to delay its approval decision for selinexor until the BOSTON data are available, we will reevaluate our spending expectations for 2019 and update the investment community at the appropriate time.

I'll now turn the call back over to Michael for concluding remarks. Michael?

Thank you, Mike. Before moving to the Q&A, I'd like to provide an overview of our key upcoming milestones.

For our first selinexor NDA, we continue to work collaboratively with the Food and Drug Administration towards the July 6, 2019, PDUFA date and prepare for a potential commercial launch by midyear.

We are continuing to work closely with the EMA in support of our MAA, requesting conditional approval for selinexor in patients with triple-class refractory myeloma, with an expected decision by the end of 2019.

For our next potential indication in relapsed or refractory DLBCL, we plan to submit an NDA to the FDA with a request for accelerated approval, and we'll be working with the FDA over the coming months to determine the most appropriate timing for submission.

We also plan to submit an [MAA in Europe] with a request for conditional approval for oral selinexor in this patient population.

For the pivotal Phase III BOSTON study, enrollment is completed -- was completed in January, and top line data are expected by the end of 2019 or into 2020, depending on the occurrence of progression events on the trial. If positive, these data could support regulatory submissions in 2020 in second-line myeloma.

Next, the various arms of the Phase Ib/II STOMP study continue in myeloma, and we look forward to presenting updates from the various combination arms at future medical meetings.

And finally, we will continue to progress our solid tumor programs in liposarcoma and endometrial cancer.

In closing, I'd just like to say that we remain deeply committed to working with the patients, physicians, regulators and the overall myeloma community with the goal of bringing selinexor to the market as a new treatment option for patients who are in dire need of novel therapies to treat their highly refractory disease.

I'll now turn the call over to the operator for questions.

(Operator Instructions) And our first question is from Brian Abrahams from RBC Capital Markets.

My first question is on the ongoing regulatory discussions and the BOSTON study. I'm curious what efficacy data would you be able to provide to the FDA from the ongoing BOSTON study without compromising the integrity of that trial? And what mechanisms and processes might be in place to do that?

And I'm curious what -- I guess, what degree of maturity of data would be available just based on the trajectory of enrollment, which I know completed in January ahead of the July PDUFA? And I had a follow-up.

Yes. So point one and very important is the FDA has specifically asked us not to disclose what data they requested and what data they reviewed in their review of the application.

Separately and independently of that, what we have said is that our data safety monitoring board, which meets periodically throughout the trial did review and go through the first interim analysis, which includes both a safety review, including an analysis of fatalities on each arm of the trial, and in addition, certain efficacy data, which is assembled by a third-party, and we are -- for which we are blinded as a company.

Based on the safety review, they found no new safety findings and no concerns about any potential imbalances on the trial. And on the efficacy side, what we know is that the DSMB did not recommend any alteration to the sizing of the trial, suggesting that -- and they did not indicate that the trial is futile. So that the trial is proceeding along the lines for which it was originally designed.

And can you provide any more details on sort of the parameters around that interim with respect to what the bar might have been for futility or for resizing?

We don't disclose those data, but what you can glean from the statistical parameters in the study is that we're looking for approximately a 30% improvement in the overall progression-free survival in the study, and that's the primary endpoint. And as you know, the key secondary endpoint is the overall response rate.

That's really helpful. One more from me, if I could. I wonder if you could give us any more detail on how the EMA review process is going and maybe just qualitatively, the nature of their questions.

Are -- were they sort of asking some of the same questions that -- and for some of the same data that FDA was? Or might we think about the European process as being a bit different just given the way they look at or -- and their preference for oral drugs in this disease. And I'll hop back in the queue.

Yes. I think it's safe to say that our -- generally speaking, there are no surprise questions at all from the Europeans. They largely follow the FDA's questions. And just given the size of this application and the timing of everything and the questions coming back, we'll be able to turn this around in a time frame that gives us an answer by the end of the year.

Our next question is from Maury Raycroft from Jefferies.

This is Mitchell on for Maury. So I wanted to ask if you're able to give any kind of context around the -- what the FDA was looking for? Is it more on the safety side or the efficacy side as well?

Yes. The FDA was quite responsive to us after the conclusion of the ODAC meeting. I think one of the lines that I am happy to share with you that they said was that they not only look at the total vote, but they look at the contents of the comments in the votes. And I think there were several members of the ODAC committee that seem to understand myeloma in great detail and had some comments that seem to resonate with the FDA regarding the selinexor efficacy on safety data.

I think the FDA was just looking for additional reassurance that some of these comments were correct. And I will add that the underlying theme with the -- what was ongoing at the time regarding venetoclax in its Phase III with venetoclax Velcade dex versus Velcade dex. FDA was continuing to conduct its own analyses throughout our review process and during our ODAC process.

And about 2 weeks after ODAC, FDA released a clinical hold or put on, implemented a clinical hold in venetoclax. And I think there has just been a heightened sensitivity around both efficacy and safety in myeloma. And FDA was doing its appropriate due diligence on all new drugs being developed in this area.

Okay. That's helpful. And then are you able to say if they requested any additional data beyond BOSTON or is it limited just to that?

No. I can't speak to any of the data, specifically, what they requested, but it was a very fulsome review of the entire dataset. And again, with the backdrop of venetoclax and other results in myeloma they were doing their appropriate diligence to make sure that they understood fully the behavior of our compound.

Our next question is from Jonathan Chang from SVB Leerink.

This is David Ruch on for Jonathan. First question, could you help set investor expectations on the KING data coming at ASCO since it's been a while since we've seen those?

Yes. To put it in perspective, the KING study was conducted in patients with previously treated in progressive glioblastoma multi-forming, that is GBM, which is a Type 4 glioma. And these patients really have no known treatment options of benefit. This was a single-agent selinexor study, which included a dose-lining component, et cetera. And what we're looking for is both responses and disease stabilization, and those will be reported at ASCO in the oral presentation.

Great. And could you provide any further context on the EMA decision, specifically to switch from the accelerated review to traditional? And do you expect the EMA's decision by the end of 2019 regardless of what happens in the interim?

We think that the EMA certainly watch ODAC very carefully, but they had their own set of questions. It's -- as I mentioned before, this was a large application. This was one of the largest safety databases with over 1,000 patients treated with hematologic malignancies in the safety database for selinexor. This was much bigger than most other accelerated approval safety databases in myeloma or other diseases.

So I think it's the large amount of data. It's a diversity of diseases, it's a large number of questions, a lot of which are very similar to what the FDA has answered. So we weren't surprised at all, just the size of the data package.

Great. And then regarding timing?

We think the Europeans are pretty good about making sure that they stay on their timelines. Remember that the EMA process does depend on the company's ability to return information in a timely fashion. So a part of the extension here was because they wanted to -- they had a large number of questions. None of -- again, none of which were unexpected, but they wanted to make sure that the company had plenty of time to return the answers.

Our next question is from Arlinda Lee from Canaccord.

It's [Dan] on for Arlinda. But I'm just wondering if you can provide a little bit of additional color on FDA discussions and maybe questions since the panel. Was there anything that, in your mind, stood out that might have caught the FDA's attention to as far as questions or concerns or comments made by any of the panel members that might them -- might have made them take another look, as it were?

Yes. Look, we can all dance around this. The FDA is taking another look or we wouldn't have had the 3-month PDUFA extension. I think that there was, unfortunately, and this has been the trend, it's difficult to get myeloma doctors on the panel who haven't worked with companies -- with the companies, and so are not conflicted.

Dr. Clifton Mo was the sole myeloma expert on the panel. And certainly, from our perspective, he did an excellent job summarizing the 6 or 7 major FDA concerns and really doing a nice job allaying those concerns at least in his mind why this drug had extraordinary activity and deserved accelerated approval in his mind based on what the FDA presented and what -- based on what Karyopharm presented.

In particular, he indicated this was the most heavily pretreated population ever studied in any trial. And it was the most aggressive myeloma that has been reported on to date. He indicated that while the drug certainly had more dose reductions than most of the other drugs in myeloma, the fact that this was a patient population that was so heavily pretreated really was not surprising and given the comorbid conditions of these patients both because of their myeloma and because of their accumulated toxicities from other drugs.

Finally and also because they're older patients with lots of other diseases, he wasn't surprised by that. And he says as an oncologist that he could easily handle these dose reductions. I think he allayed some concerns that our serious adverse event rate was higher with this drug, and he indicated that in his mind, it was similar to the other small molecules that are already approved in earlier-stage myeloma patients. And he indicated that the kinds of infections that were seen in our trial are, unfortunately, no different than what is seen in essentially all other myeloma trials. It's just the nature of this disease and the immunocompromise for myeloma.

So I think they listened to him a lot. I think they listened to Dr. Harrington on the statistics side who was pretty convinced that this compound had clear single-agent activity, even though it's used with low-dose dexamethasone. And I think they have been convinced by the panel and by additional data provided, that the low-dose dexamethasone is contributing little or nothing to the actual ORR in the study.

(Operator Instructions) And our next question is from Eric Joseph from JP Morgan.

This is Turner on for Eric. A couple questions from us. Michael, I think you've previously cited mature duration of response as a gating factor to SADAL filing. How should we be thinking about the level of sensitivity around DOR that we initially saw reported at ASH in 2018, given the number of censored events?

And then second part to that, what would be viewed as clinically meaningful or data that you could file on with respect to DOR and PFS looking towards the first half '20 submission?

Sure. Good point. So remember that an accelerated approval, response rate and duration of response are important. There have been no drugs, no small molecule drugs approved in DLBCL period. And the small molecule drugs that are sometimes used such as Revlimid, and to some extent, ibrutinib, are mainly restricted to the ABC subtype of the disease, and unfortunately, have single-agent durations of response better in the 4-month range, which are not considered -- in lymphoma are not considered durable. I would comment side -- on the side that in myeloma, 4 months in a refractory population is considered quite important.

In lymphoma, they're looking for -- typically, they're looking for at least 6-month durations of response, and we consider that our goal for this study. And then looking for response rates that are above the 20% to 25% rate in these patients who have no other options. So I think those are the basis.

I think we will update in the future, I hope, on the SADAL results because you're correct that one of the reasons the FDA asked us to just hold on the application until we had mature data was because of the number of censored events on the DOR. We want to make sure we cross that 6-month line with the vast majority of patients already having crossed that line as opposed to being early on.

So we'll have to wait and see in terms of public disclosure of data, but we are excited, and we remain confident on these kinds of durations that are north of 7 months for our drug with response rates in the high-20s to 30% are real. And will hold up, and that we'll be able to submit the application.

Could we potentially anticipate some data, sometime this year maybe at EHA or ASH?

We could potentially anticipate that.

Okay. And then one last one from us. SIENDO is now a company-sponsored trial, which requires, obviously, a certain amount of investments. How is this bearing impact on the P&L that hasn't been incorporated into prior guidance? And I'm just kind of curious how has your thinking changed with respect to the probability of success and the indication to convert to a company-sponsored trial versus an IST?

Yes. I'll just start, and then I'll turn it over to Mike for the budgetary question. I think we're increasingly excited about the potential for this drug in that indication, and we want to move it faster than is possible with an investigator-sponsored trial. So that was the reason for what was done. And the lead investigator is still Ignace Vergote in Europe, and he's been a huge supporter of this program and will continue to be. Let me turn it to Mike.

Sure, yes. So the cost for that program for SIENDO are in the expense guidance that we gave this morning, which is again between $200 million and $250 million of OpEx for 2019.

Just to add to that quickly, I think it's important to take any of these, especially these new programs in the context of what potential market size we're looking at. There are currently no maintenance therapies available, approved, at least, for patients with endometrial cancer. This is in stark contrast to ovarian cancer where PARP inhibitors have been important and life-extending therapies in the maintenance setting.

So we're looking to do that. We -- as you know, our drug has a broad mechanism of action. So we don't have any particular genotype specified for uterine cancer, but following initial platinum-taxol therapy, our drug would come in as maintenance therapy for those patients, which is the vast majority who receive -- who obtain at least a partial response or a complete response to their initial therapy.

We think that -- we estimate the size of these markets are well north of $500 million and could be as high worldwide as $1 billion. So these are -- this is a substantial market with a substantial unmet medical need.

Our next question is from Ying Huang from Bank of America Merrill Lynch.

This is Alec on for Ying. My first is on selinexor in DLBCL. Do you view the NDA submission in DLBCL as contingent upon approval in multiple myeloma, given they are quite different diseases? And SADAL, like STORM, it's a single-arm study. So I guess how do you plan to frame the NDA given the FDA's preference for randomized controlled studies.

Yes. Let me start with the second question. The difficulty in DLBCL is that for patients who are not eligible for transplant or those that have progressed following either transplant or CAR-T therapy, there are no approved therapies. And there is frankly no standard of care, and a quick look at the NCCN guidelines will verify that.

So it's virtually impossible to design a study that has an appropriate control arm. People have tried in the past. And they've even tried sort of dealer's choice or physician's choice control arms. And they just don't accrue and there's little interest. So we designed the SADAL study with the goal to show single-agent selinexor activity, which in and of itself is a very important demonstration.

The reason for us giving a little bit of a wait and see on the exact SADAL filing is because we don't want to end up in a situation where we have another ODAC around a single-arm trial in DLBCL like we did in myeloma. So we want to work with the FDA, and we are working with the FDA to make sure that we're all on the same page as they review this.

I should mention about 80% of the NDA for SADAL has already been reviewed by FDA in terms of safety data. So what they're really reviewing is the efficacy data from the SADAL study and any updated data from ongoing trials that we would provide. And so we want to make sure we're completely walking together with FDA and not end up with a difficult ODAC.

If we do have to delay it until the BOSTON top line data are available, we could, but we are thinking that if we have good discussions with FDA and move forward with the myeloma approval, they would be open to an independent SADAL NDA, which will come in before the BOSTON data.

Okay. Great. And as you're sort of in a holding period here waiting for the approval on multiple myeloma, how are you managing the prior commercial ramp? Mostly, I guess I'm wondering how you're utilizing the sales team right now. And if the PDUFA were to be delayed further, how do you plan to manage G&A expense for the rest of the year?

Yes. This is Mike. I'm going to turn it over to Anand Varadan, our Chief Commercial Officer. Anand?

Yes. Thank you for the question. So the -- first of all, our full field organization is hired and in place and trained to the extent it's possible on the disease state and in terms of the customer base and the like.

And they've also now -- we're using this time frame before approval to engage with customers in an appropriate way. So to educate them, for example, around the mechanism of disease. They have materials in order to do that and to really make sure that they understand the role of SINE technology and around nuclear export, as it plays a role within cancer because that's a new area in terms of mechanism that's not necessarily familiar to this customer base.

They're also using this time to really profile these -- the customers and to try to understand what the movement of patients are through their various practices, where they're likely to be given the label that we would anticipate or the kinds of labels that we might be able to anticipate for selinexor when it's approved as well. So we can be in the strongest possible posture to have a strong ramp for the commercial uptake after approval.

At this time, I'm showing no further questions. I would like to turn the call back over to Michael Kauffman for closing remarks.

Just to say, thank you, everybody, again, for joining today's call, and have a great day. Bye-bye.

Ladies and gentlemen, thank you for your participation in today's conference. This concludes the program. You may now disconnect.