Mirati Therapeutics Inc (MRTX) 2021 Q4 法說會逐字稿

Good afternoon, and welcome to the Mirati Therapeutics Fourth Quarter 2021 Earnings Call. My name is Sarah, and I will be the operator for today's call. (Operator Instructions)

It is my pleasure to introduce Ryan Asay, Vice President of Corporate Affairs at Mirati. Ryan, you may begin the call.

Thank you, Sarah. Welcome, everyone, to this afternoon's call. With me today are David Meek, Mirati's Chief Executive Officer; Dr. Jamie Christensen, Mirati's Chief Scientific Officer; Ben Hickey, Mirati's Chief Commercial Officer; and Vickie Reed, Mirati's Chief Accounting Officer.

Unfortunately, due to a last-minute acute stomach flu, Dr. Chuck Baum, Mirati's President, Founder and Head of Research and Development, will not be able to participate in this afternoon's call. Please note that this conference call will include forward-looking statements. Because such statements deal with future events and are subject to many risks and uncertainties, actual results may differ materially from those in the forward-looking statements. For a full discussion of these risks and uncertainties, please review our annual report on Form 10-K that is filed with the U.S. Securities and Exchange Commission.

This afternoon, we released financial results for the quarter ended December 31, 2021, and recent corporate updates. This press release is available on the Investors section of our website at mirati.com.

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

Thank you, Ryan. Good afternoon, everyone, and thank you for joining us. On this afternoon's call, I will provide some initial remarks before asking Jamie to share an update on our clinical development programs; Ben, to comment on our commercial preparedness and Vickie to summarize our financial results. I will then provide a few concluding remarks before taking your questions.

2021 was an important year of growth, progress and strong execution for Mirati. There are many achievements our team accomplished, and I'll highlight just a few of them here. We received breakthrough therapy designation for adagrasib for the treatment of previously treated KRAS G12C mutated non-small cell lung cancer. We announced positive top line monotherapy data for the registrational Phase II cohort of adagrasib's KRYSTAL-1 study and completed the submission of the adagrasib new drug application in patients with previously treated non-small cell lung cancer under the FDA's real-time oncology review pilot program.

We presented highly encouraging colorectal cancer data for adagrasib both as a single agent and in combination with cetuximab in late-line patients. We also share preliminary results from the combination of adagrasib and pembrolizumab in first-line non-small cell lung cancer, which provided strong support for our continued prioritization of this combination. We initiated several additional potentially registrational studies with adagrasib, including as a single agent in certain subpopulations of first-line non-small cell lung cancer as well as in combination with cetuximab in second-line colorectal cancer.

Beyond adagrasib, we continue to advance and expand our increasingly broad targeted oncology pipeline, including completing the submission of an investigational new drug application for MRTX1719, our MTA cooperative PRMT5 inhibitor.

In November, we bolstered our capital position with a secondary public offering which gives us increased financial strength and flexibility to continue to appropriately invest for success across our pipeline and in preparation for a potential U.S. commercial launch later this year. We continue to build our corporate capabilities where a company with strong end-to-end expertise from early discovery through drug development and commercial with strong foundational enabling functions.

We're incredibly excited about the transformational year ahead of us. We are well prepared and have the resources to achieve our bold agenda. Important potential milestones in 2022 include gaining FDA approval for adagrasib and rapidly launching our first commercial product to patients with lung cancer in the U.S., which remains our top priority. Adagrasib's profile has the potential to make a meaningful difference for patients with lung, colorectal, pancreatic and other cancers. We remain confident that adagrasib has blockbuster potential.

We expect to complete the submission of our European regulatory package for adagrasib based on our Phase II results. With adagrasib's blockbuster potential, we are advancing the broad development plan we have for adagrasib including exploring earlier lines of therapy and into additional tumors. We are aggressively moving forward the other important value drivers in our broader portfolio. We now have 3 meaningful programs in clinical development, each with a large commercial opportunity in areas of high unmet need. We're on track to reach the number of events needed to trigger the interim readout of sitravatinib's Phase III SAPPHIRE study at the second half of 2022.

We initiated a Phase I clinical study for MRTX1719, our MTA cooperative PRMT5 program and expect to submit INDs for MRTX1133, our KRAS G12D inhibitor and MRTX0902, our SOS1 inhibitor in the second half of 2022. We have established ambitious goals for ourselves this year. We see significant enthusiasm across all areas of the company as we continue to execute on these priorities and drive results with a sense of urgency and passion to transform the lives of patients with cancer.

I'm excited about our momentum and proud of the company we are building. With that, I'll turn it over to Jamie.

Thanks, David. In succession today, I will touch on our 3 programs in clinical development -- adagrasib, sitravatinib and MRTX1719, our MTA cooperative PRMT5 inhibitor. We're pleased with the progress we're making in advancing adagrasib through clinical development, and we look forward to potentially delivering it to patients in the commercial setting this year.

Earlier this month, we announced the FDA's acceptance of our NDA for adagrasib for accelerated approval under the Subpart H regulatory path for the treatment of patients with non-small cell lung cancer who harbor the KRAS G12C mutation and have received at least 1 prior systemic therapy. The target action date is December 14, 2022. We have breakthrough therapy designation status and expect to continue to have positive and collaborative interactions with the FDA through the NDA review process.

We look forward to presenting the full data set from the Phase II registrational cohort from the KRYSTAL-1 study, which was the primary basis of our NDA filing as well as initial clinical activity in patients with non-small cell lung cancer brain metastases from a separate cohort of patients in the KRYSTAL-1 study who had active and untreated brain metastases.

We expect to present both of these data sets at a medical meeting and are targeting ASCO as the potential venue this year. We continue to enroll patients in adagrasib clinical studies and are generating additional data in patients with a wide range of cancers. In first-line non-small cell lung cancer, we continue to explore adagrasib as a single agent in certain underserved subpopulations. These include patients harboring G12C and STK11 co-mutations as well as KRAS mutated patients with TPS scores of less than 1%. We expect to provide additional clarity on a potential pathway for accelerated approval of adagrasib as a monotherapy in these patients this year as well as sharing initial data from these cohorts in 2023.

Also in systemic therapy naive non-small cell lung cancer, adagrasib is being studied in combination trials. The most advanced and highest priority combination is with pembrolizumab, where we continue to enroll patients at the 400-milligram BID dose of adagrasib in the KRYSTAL-7 study. We plan to share an update from the ongoing Phase II KRYSTAL-7 study in the second half of this year, including the analysis of patients stratified by TPS score. We are also actively planning to start a Phase III trial evaluating the adagrasib and pembrolizumab combination in treatment-naive patients later this year. This is subject to results from the ongoing K7 study.

We also continue to enroll patients with colorectal cancer, both in late-line CRC as a single agent and in combination with cetuximab. We are also continuing to enroll the registration-enabling Phase III study in combination with cetuximab in second-line CRC patients. We're also pleased with the favorable results we recently presented at the ASCO GI Cancer Symposium in pancreatic cancer and other gastrointestinal cancers. We are continuing to enroll patients with KRAS mutations and other solid tumors and will continue to explore potential accelerated regulatory approval pathways in these patient populations.

We expect to provide additional clarity on a potential pathway for accelerated approval of adagrasib in late-line CRC as well as sharing next steps in other solid tumors, including pancreatic cancer this year. We continue to pursue a broad combination development program for adagrasib beyond the combinations with pembrolizumab and cetuximab. These include combinations with SHP2, SOS1 or CDK4/6 inhibitors, as well as VS-6766, a MEK/RAF pathway inhibitor with a unique mechanism of action.

We expect to have initial data readouts for some of these proof-of-concept combination studies in 2023 after we've generated additional data. We will continue to explore the potential of additional novel combination options beyond those we are currently evaluating.

Now moving on to sitravatinib. We are enthusiastic about the program based on the 14.9 month overall survival demonstrated in the Phase II MRTX-500 study of sitravatinib in combination with nivolumab in non-small cell lung cancer patients previously treated with checkpoint inhibitor therapy. The Phase III SAPPHIRE study is on track to reach the number of events needed to trigger an interim analysis of overall survival in the second half of 2022. If positive, this trial could be the basis of regulatory submissions for full approval in the U.S. and Europe.

Now moving on to MRTX1719. Again, this is the second generation or next-generation MTA cooperative PRMT5 inhibitor. First, we're very pleased to have advanced another program into clinical development. 1719 is based on a principle of synthetic lethality through targeting of MTAP deletions, which are present in nearly 10% of all human cancers. In contrast to first-generation PRMT5 inhibitors, 1719 is designed to selectively target the PRMT5 MTA complex. This leverages the abnormally elevated levels of MTA uniquely found in MTAP-deleted cancers. 1719 selectively targets MTAP-deleted cancer cells while sparing healthy nontumor cells. 1719 is orally bioavailable and its unique ability to bind to the PRMT5 MTA complex is predicted to spare patients from toxicities observed with first-generation PRMT5 inhibitors.

For this program, we recently initiated a Phase I clinical study and are actively enrolling patients. The clinical development plan includes moving through Phase I dose escalation, then into Phase Ib dose expansion cohorts, followed by a number of Phase II cohorts across several tumor types. These include mesothelioma, pancreatic cancer, lung cancer, malignant peripheral nerve sheath tumors, also known as MPNST, as well as a basket cohort of other MTAP-deleted tumor types. We will explore 1719 as a single agent and have a number of rational combination strategies we're developing utilizing nonclinical translational studies that would also target next year.

We expect to share initial clinical data in 2023 after we have a dose and have generated sufficient data to demonstrate clinical proof of concept. Finally, we continue to make significant progress with our preclinical programs, including MRTX1133, a KRAS G12D selective inhibitor, and MRTX0902, an in-house SOS1 inhibitor which leverages SOS1's ability to enhance the activity of KRAS inhibitors such as adagrasib. Both programs remain on track for INDs in the second half of 2022.

With that, I will turn it over to Ben.

Thanks, Jamie. I'll touch briefly on our financial strategy for a successful launch subject to FDA approval of adagrasib. We initiated our launch preparations 2 years ago, and we continue to execute on a staged approach to our launch [treatment] efforts in anticipation of a launch as early as the third quarter of this year. There are several pillars that we believe will enable us to be highly competitive. First, an aggressive unique molecular profile and 24-hour half-life have enabled us to generate meaningful clinical data across multiple lines of therapy and tumor types and includes the potential for CNS penetration, which is a particularly important characteristic in lung cancer where up to 30% of patients will develop brain metastases.

Second, over the past 2 years, we've attracted top talent across biotech, pharma and health care provider organizations. We've seen incredible interest in our commercialization roles, both because of adagrasib's profile and because of Mirati's unique culture and targeted oncology pipeline. This has enabled us to recruit a team with extensive experience and demonstrated success in launching some of the industry's top oncology products.

Beginning in 2020, we have built an outstanding medical affairs capability, including a significant investment in customer-facing field medical. This has resulted in ongoing engagement across top academic centers and community oncology networks and the initiation of an expanded access program. We've established an experienced value and access team who continue to engage U.S. payers managing the majority of covered lives. We've also developed marketing, analytics and insight capabilities as well as all of the foundational capabilities required for a deep understanding of customer needs and ultimately, a successful launch.

Third, because we have built our team from scratch, we've been able to optimize how the team is designed with a focus on integration and speed of execution across key functions at the account level. COVID has changed the way our industry engages with oncology providers moving from a focus on repetition of live engagements to relevance and customization based on customer preference by digital all live channels. We view this as a fundamental shift that really levels the playing field among larger pharmaceutical and biotech companies like ourselves, and positions us well for long-term commercial success.

Fourth, we have the capital necessary to invest for success both in terms of preparing for and successfully executing on the initial launch and to invest in the long-term growth and expansion of adagrasib across tumors, lines of therapy and combination approaches.

We are very enthusiastic and excited about this potential launch and being able to deliver this important treatment option to patients who are living with this type of cancer. The physicians who treat patients with lung cancer are also waiting for new options to treat their patients.

With that, I'll turn it over to Vickie.

Thank you, Ben. We ended the fourth quarter with approximately $1.5 billion in cash, cash equivalents and short-term investments, which includes net proceeds of approximately $475 million from a secondary capital raise we completed in November 2021.

Research and development expenses for the fourth quarter of 2021 were $153.8 million compared to $82.7 million for the same period in 2020. The increase in research and development expenses is primarily due to increases in expenses associated with the development of adagrasib and sitravatinib, preclinical and early discovery activities, salaries and other related costs, which includes an increase in share-based compensation expense as well as other research and development costs, including onetime costs associated with registrational manufacturing batches.

General and administrative expenses for the fourth quarter of 2021 were $43.5 million compared to $25.3 million for the same period in 2020. The increase is due to growth in salaries and other employee-related costs, which includes share-based compensation expense, professional services expense, which is primarily associated with commercial scale-up and other costs related to the growth of our business. Net loss for the fourth quarter of 2021 was $199.6 million or $3.72 per share basic and diluted compared to a net loss of $101.1 million or $2.08 per share basic and diluted for the same period in 2020. Please see our press release from earlier this afternoon for additional details about our fourth quarter and full year 2021 financial results.

David, I'll hand it back over to you.

Thanks, Vickie. I'll conclude by reinforcing what an exciting time it is for Mirati. We have a broad and sustainable targeted oncology pipeline across multiple targets and tumors and see significant long-term value in the operational and commercial synergies across our portfolio. We have the financial resources to continue to invest for long-term success. We are continuing to invest in adagrasib's U.S. launch readiness as well is in a broad development plan to enable us to optimize the blockbuster potential of this important product. Our objective is to launch and further develop a market-leading KRAS G12C inhibitor. We are investing to drive sustainable growth and ensure rapid progression across the breadth of our innovative target oncology pipeline beyond adagrasib.

In addition to the internal capabilities we have built, we are enhancing and accelerating our progress through selective partnerships. In the fourth quarter, we announced 2 nonexclusive clinical collaboration agreements. The first is with Sanofi to evaluate the combination of adagrasib with Sanofi's investigational SHP2 inhibitor. The second is with Verastem Oncology to evaluate the combination of adagrasib with Verastem's investigational RAF/MEK inhibitor. We expect to continue to be active in pursuing opportunities to accelerate and expand our pipeline through partnerships.

We are incredibly pleased with the progress we've made and look forward to the many important milestones we are approaching. I continue to be impressed by the team we have at Mirati. They have an incredible energy and passion for improving the lives of patients. I thank them for their continued efforts and focus as we work to transform the lives of patients with cancer.

With that, we're ready to take questions.

(Operator Instructions) We'll take our first question from Tyler Van Buren with Cowen and Company.

It's great to see all the progress and thank you for taking the questions. I have two. First, could you elaborate on the recent site audits or site visits that have been conducted by the FDA as part of the RTOR process? And if this is occurring earlier than expected based on your conversations with regulatory consultants. And the second question is related to the full Phase II data release at ASCO. We'll obviously look to confirm positive results that have been disclosed previously, but other than response data. Is there anything else that might be disclosed that could be differentiating? Or should we primarily look to the CNS MET data for that?

Tyler, it's David. A couple things. Regarding the -- some of the site audits that are already occurring with adagrasib, I think it's standard business. We certainly take it as a good sign that the FDA is engaged having -- being part of the pilot program for the real-time oncology review, it certainly gives the agency a head start on the review. So despite audits that are happening right now, that have happened. Some more will happen, but I think we're not going to discuss the ongoing interactions with the FDA, but we take it as a positive sign with that.

Regarding having the data published at ASCO, so we're announcing for the first time that we expect the data to be released at ASCO. We'd say stay tuned for the data. We're going to announce a full data set for the cohort A of the registrational trial and that will be presented at ASCO. We're presenting that data set as well as we intend to present brain mets data at the same time.

And next, we'll move on to Gena Wang with Barclays.

This is [Fershuta] on for Gena. Can you hear me okay?

Yes.

First, I just had a quick clarification, and then I have a follow-up question. Did I hear correctly that for the monotherapy 1L first-line data sets both STK11 and TPS low, these data sets will be presented sometime in 2023?

Yes. This is Jamie. That would be our goal. And just to note that these are 2 separate cohorts or studies. One of them is with KRAS mutation and STK11 co-mutation. The other one is in KRAS mutation with TPS score less than 1%. And yes, we would be planning on presenting that next year.

Okay. Great. Then the other follow-up I had is for the PD-1 combo data set in the second half for the 400-milligram cohort, is it fair to assume that the number of patients can be at least in the 20- to 30-patient range given that at that time point, you have at least 3 quarters minimum to enroll patients?

So it's David. I'll jump on that and ask Jamie to elaborate. So what we're going to do is we're enrolling that trial right now as we announced in the fall when we switch the protocol to 400 milligrams BID plus full dose pembrolizumab. The trial is actively enrolling. We're encouraged with the ongoing recruitment. So what we're going to do is we're going to get to a data set. We think it will be a meaningful number of patients.

We can look at the safety and tolerability of the combination. Maybe we'll have a couple scans [behind us], but it will be a meaningful number of patients and well into the double-digit range for that patient population. That will inform us going into the Phase III program. And as you know, we're already actively preparing for that Phase III start, and we'll use that data to make that decision to jump into Phase III. Jamie, anything else? Okay. Does that help, Fershuta?

No, that's helpful.

Next, we'll move on to Gavin Scott with JPMorgan.

Just a follow-up on the PD-1 combo. I guess are there any molecular underpinnings that would suggest a better response in patients previously treated with PD-1 or PD-1 chemo. I guess I'm just asking in the context that you've highlighted that your registrational trial has 98% patients there, while LUMAKRAS has around 80%. So just curious on your thoughts.

Yes. This is Jamie again. I think it's hard to fully answer that question today based on the information we have in hand, especially as it relates to prior therapies. Would just say as a reminder that there is data out there suggesting the STK11 and KEAP1 co-mutations as unmet medical need for chemo immunotherapy, the response rates, PFS and OS are fairly low there. That's partially the premise of us going after the STK11 co-mutated subpopulation. If we continue to see strong activity there, we would suspect that the unmet medical need with standard of therapy would be a logical discussion point with the agency around making sure that we're developing the drug in a setting with enhanced unmet medical need.

We're also looking at the TPS less than 1% population. Would say that we follow both Amgen's data and, of course, ours. There's no reason to believe to date that the response rate wouldn't be at least as good as the rest of the population and the TPS less than 1%, on a kind of subset of patients. So that remains as an effort for us as a monotherapy.

And I would just say that we do believe, based on preclinical data, that the KRAS inhibitor could reawaken the immune response in tumors that may be somewhat immune cold, again, citing those patient populations that I mentioned earlier. So I do believe that these populations like the STK11, KEAP1 and TPS less than 1% would be subject to treatment with both combination therapies as well as monotherapies. And in fact, we'll be pursuing both angles there. And if that didn't answer your question, please let me know.

And next we move on to Umer Raffat with Evercore ISI.

This is Eric on for Umer. Just 2 quick questions. The first on the PRMT5. With the IND submitted, what sort of details can you share on the trial design? And what's the expected safety or PD profile versus competitive agents?

Sure. Yes. First, regarding the trial design. We are utilizing the agency's guidance around 2019 on multi-cohort studies. And these studies are essentially designed to allow rapid development in multiple settings for targeted therapies that are essentially targeting subsets of patients. So in a way, this study will be the first study and also a Swiss Army knife of studies with different objectives.

Number one is we will be pursuing dose escalation for the first part of the study. We're pleased with the outcome of our toxicology studies, which allow us to start with a reasonably high dose in patients that would be approaching therapeutic concentrations. Once we establish a recommended Phase II dose or perhaps multiple doses, we would be breaking into Phase Ib studies where we would be evaluating the monotherapy activity in any patient with an MTAP gene deletion to get an enhanced understanding of dose-dependent tolerability as well as antitumor activity.

As soon as we're confident in moving forward with a recommended Phase II dose, then we would be opening Phase II expansion cohorts. And they're essentially the 4 cohorts that I had mentioned, the pancreatic ductal adenocarcinoma, non-small cell lung cancer, including both adeno and squamous cell cancer as well as the 2 kind of more niche indications, mesothelioma and malignant peripheral nerve sheath tumors. And finally, 1 additional cohort, which would be a catch all. Anybody who doesn't have 1 of those first 4 primary malignancies. And we'll be looking at expanded activity in all of these different patient sets as a monotherapy.

So I would say that's part 1. Part 2 is we are interested in combinations. I'm not going to go into much detail today, but I will say that the ongoing studies in the preclinical setting have pointed to a couple of interesting codependencies with PRMT5 inhibition that would be the substrate to start rational combinations as soon as we identify a recommended Phase II dose. So that would also potentially be part of the first-in-human study or depending on how we aggressively pursue could be also a separate study.

Then I think your last question was related to the molecular aspects and the PK/PD relationship, relative to first-generation inhibitors. And one thing that has come out as interesting in our preclinical studies is suggesting that the maximally effective dose of a PRMT5 inhibitor with this particular mechanism of action is really associated with near completely inhibiting symmetrical dimethylarginine. The primary pharmacodynamic marker or molecular marker which PRMT5 works through to regulate histones and gene expression.

So we do believe that near complete or complete inhibition of SDMA for the full dose interval is going to be critical. And do view the key differentiated factor with second -- first versus second-generation inhibitors is essentially the ability to achieve that near complete inhibition. First-generation inhibitors are somewhat limited by neutropenia, thrombocytopenia anemia. And although they're able to achieve pretty good SDMA inhibition, in our measure, it's -- the full inhibition is going to be critical to drive monotherapy activity. Therein lies, I think, the value proposition and premise for development of this class of drugs. I think I hit all the key points. Did I miss anything?

No, no, that's all. And just 1 follow-up question. Are there any updates to the commercial readiness plans given the longer review time line or any change in competitive dynamics there?

Sure. It's David. Regarding the commercial launch preparedness, I tell you, we're real excited about where we've come so far. We plan on being launch-ready by Q3 this year. And that did -- we've got a medical affairs organization already in the field. We have a value and access team in the field. We have sales management in the field. This time line gives us even more time to prepare for a highly successful and rapid launch. So that's the approach we're taking right there for the launch planning, and we'll be really, really ready to go and look forward to a rapid launch and building a blockbuster. Ben, anything you want to add to that?

No. I think you framed it pretty well. No big changes. We'd get to sharpen things a little more. We've got a few more interactions with our customers and really understand some of the dynamics going on, and we feel very confident. So I think a little bit more time hopefully means that we can sharpen things even further.

And next, we'll move on to Salveen Richter with Goldman Sachs.

This is Andrea on for Salveen. Two questions for us, please. The first, maybe as a follow-up to the prior question on the CNS data that you're expecting at ASCO. Just wondering if you could help to frame expectations into this read and how meaningful you think this will be when you think about demonstrating differentiation against LUMAKRAS?

Sure. Yes, we look closely at, of course, the properties of our drug and we are aware of formerly presented LUMAKRAS data. So I think a few key points about adagrasib. Both preclinically and clinically, we've studied the ability of the drug to get into the CNS. And we previously commented on what's called a Kpuu value, which is essentially the level of drug in the cerebrospinal fluid relative to the free fraction adjusted plasma concentrations at a comparable time point. And we've seen Kpuu values approaching 0.5, which is meaningful. Just a couple of kind of bars that Ben said, osimertinib is an example of a drug that has a Kpuu value of about 0.3 and, very robust activity against brain metastases.

The 2 drugs in the ALK inhibitor space, alectinib and lorlatinib, are agents with Kpuu values of greater than 5 and have very strong CNS penetrants and again, have demonstrated activity in patients with brain metastasis that is pretty different or differentiated relative to first-generation inhibitors. So in the EGFR space, let's note that erlotinib and afatinib are agents with response rates of around 10% in intracranial metastases and lung cancer patients.

And then the crizotinib is an agent with about a 27% response rate in the ALK inhibitor space, again, a non-brain penetrant inhibitor. You may be aware that osimertinib, lorlatinib, alectinib are all agents that have demonstrated intracranial response rates fairly consistent with their activity in peripheral disease. So suggesting that if the drug can get into the CNS it can be differentiated and demonstrate essentially robust activity there.

As mentioned in the call, we believe we will have a substantial number of patients to talk about at the ASCO meeting or wherever we land and essentially there, I would note that we've had the open cohort with active brain metastases or untreated brain metastases. We will be talking about that. We'll also be talking about subset analysis from our cohort A patients, which essentially have treated or controlled brain metastases. And again, I think that the number of patients that we'll have to talk about will be meaningful to at least appraise the preliminary activity of the drug in this setting.

Got it. And then for a second question, maybe for Ben. Just with the fourth quarter LUMAKRAS sales being lighter than some had expected, despite diagnosis and patient identification being pretty robust, just curious what your sense is for what is slowing physician uptake here? And is there anything you can do to drive additional utilization when adagrasib is on the market?

Sure. Thanks for the question. I think just as a reminder, with a novel class coming to bear, the people have to be reminded that most of the testing, almost 80% of it, does occur in the front line. So those patients now with the benefit of the 189 regimen, it's still taking 18 to 24 months for these patients to actually come into second line or beyond therapy. So that does take some time. And secondarily, we've done a lot of work about understanding the local dynamics and understanding that it does also take a while for the patients to be identified in the EMR. So physicians to see that it's an actual mutation and to be able to take action on it.

So we expect that the market will take a little while to mature. We see it continuing to mature and those patients becoming available in second line and beyond. And I think that as we come to market, hopefully, later this year, physicians will be looking for the preferred KRAS G12C inhibitor. So we are -- sometimes being second to market is not always the best, but sometimes it has its advantages. And in this case, having some of the testing already, the foundational work completed, that's been something that we have not been -- have not focused on so much to date.

Yes. I would add to that, that certainly, we're going to benefit by LUMAKRAS doing those market shaping -- building the market shaping of KRAS G12C testing. And by the time we are approved we think a lot of this will be behind us, and we can then focus our efforts on communicating and educating the physicians on the clinical profile of adagrasib as a G12C inhibitor for their patients.

Next, we'll take our next question from Evan Seigerman with BMO Capital Markets.

Just a few for you guys with the update. So can you expand on the bar for monotherapy in the frontline setting in patients with both the TPS less than 1% and the STK11 co-mutation. And have you had conversations with the regulators as to kind of what they're looking for here? And then I have 2 follow-up questions.

Sure. Regarding your first question, noting, first of all, KEYNOTE-189 as it relates to TPS score. So KEYNOTE-189, as you may recall, the overall patients had a response rate of around 48%. And then when they did the subset analysis, the response rate was 32%. And essentially, that represents our bogey or no hypothesis to improve upon for the TPS scores of less than 1% with KRAS co-mutations.

Secondly, the STK11 KRAS subset, the bogey there has mostly been defined by academic analyses at major cancer centers. And I think the numbers that are coming out for STK11, patients that have also a KRAS co-mutation is that the response rate there is going to be about 20% to 25%. So again, that's essentially what we need to improve upon.

Now I think when you look at prior drug approvals in the first-line setting, that also sets a bit of a precedent or a bar for us to shoot for. And so there have been drug approvals with response rates in the first-line setting of over 55%, perhaps over 60% in some cases. And so if you take those 2 parts of the equation together, you would expect to be able to hit a 55% to 60% response rate or higher would give a clear differentiation from how standard of care performs in those particular patient populations.

We have had ongoing discussions with the agency. They will, of course, never quote a particular number that we need to exceed. They call that a review issue. But I think they encouraged us if should we present or provide compelling data in the target response rate ranges with reasonable duration of responses that we would generally be in range to submit for those particular patient sets. So that's really where we stand today. All of our discussions with the agency are considered preliminary and now the rest of our program is data-driven.

That's quite helpful. And then when you kind of talk about planning for a Phase III PD-L1 combo, can you expand like what that actually means? And also touch on when the study may start and what you're waiting for here?

So let me start, it's David, and that is, first of all, regarding the preparation for the Phase III protocol. We want to be aggressive, and we want to move fast. We realize that the opportunity in the frontline setting is significant for that patient population. And we want to be the first G12C inhibitor to be studied in combination and ultimately approved and launched and available to patients over time. So that's why we're planning for success with 400 milligrams BID plus pembro. So we don't like to do things sequentially here. We like to do things in parallel and move as fast as we can. So that's the first part of that question. I'll turn it over to Jamie to...

Yes, I certainly agree. I mean we need to be poised for success here. And let's note that planning a Phase III study and it's opening globally is an equation of greater than 9 months. So essentially, we are actively planning to be able to open that study. With regard to the statistical hypothesis, I think we know what part of that equation is, and that is how KEYNOTE-189 as a control regimen would perform in KRAS mutated patients. So we're essentially basing some of our clinical trial design assumptions on that.

And then as you know, we have the ongoing KRYSTAL-7 study to help inform how adagrasib and pembrolizumab will perform initially with respect to tolerability, dose intensity and otherwise, but also at least with regard to initial response rate. And with that data, we would be able to make some additional assumptions around the clinical trial design. So that's really where we stand at this point. We've been encouraged with what we've seen from the small number of 400 mg BID patients and are looking to better understand that as the year comes along.

And next, we'll move on to Michael Schmidt with Guggenheim.

Just a follow-up on the first-line cancer monotherapy, the 2 cohorts. I guess in your preliminary discussions with the FDA, have you had any conversations about the sample size of cohorts, how many patients are targeted to be enrolled in either of these 2 cohorts? And then the other question was really about your potential plans in pancreatic cancer. Should we consider a third-line accelerated approval strategy potentially? Or are there opportunities to perhaps move into an earlier setting in PDAC?

Sure. Yes. Regarding the 2 cohorts, so we essentially know what the no hypothesis are. For PD-L1 less than 1%, it would be de facto around 32% response rate with a meaningful duration of response. For the STK11 subpopulation it would be somewhere in the 20% to 25% range, again, with a meaningful duration of response. As noted in the discussions with the agency, they will not give us a number what we need to accomplish with regard to response rate or duration of response, but we do have prior experience with the approval of other targeted therapies as monotherapies in these settings.

And essentially, if we use those as targets, the number of patients necessary to get approval wouldn't be unreasonable. We also recognize that we have a significant safety database as a monotherapy from all the other additional work we're doing. So I can't really give you a number today, but we essentially believe that the enrollment of a kind of approvable data set could be in the range of other accelerated approvals or monotherapies for targeted therapies in the non-small cell lung cancer setting.

For your question on pancreatic cancer, I think you're aware of the data we presented at ASCO GI earlier this year. So just to note when you look at standard of care, maintaining a 50% response rate and a progression-free survival or duration of response north of 6 to 7 months is actually meaningful even for first line. Now it would be challenging for us to start a development program in treatment-naive patients.

So we'll continue to focus on second and third-line patients. As we get more and more data, we'll wait for that to mature along with a better understanding of the durability of response. And otherwise, we think if that data holds up, again, along with the safety database that we've generated and other types of cancer that an accelerated approval would be a possibility in either one of those settings. And really, the ongoing generation of data will help further inform that path.

Sorry, let me just say something Michael, just on the frontline lung cancer with the STK11 co-mutation and the patients with the TPS score of less than 1%, we're already moving very aggressively in that patient population as well because that represents about 40% of the first-line non-small cell lung cancer patients with the G12C mutation. So the unmet need is high and the opportunity is great in that patient population.

That makes sense. Just to clarify, are we thinking 100 patients per cohort in first-line non-small cell lung cancer or something lower than that, just given that you already have a certain amount of data in other [present].

Right. Again, I mean, please take my response in the spirit that this is a review issue and it remains undefined. So in a way, we've developed our statistical hypotheses and are targeting those hypotheses. And ultimately, depending on how the data shakes out, that would determine the number of patients necessary probably to present a convincing argument to the agency. But would just say, if you looked at this as a purely statistical argument, the number would be under 100. Again, assuming response rates of 55% to 60% or higher and assuming that the no hypotheses of 20% to 25% in STK11 or 32% in essentially the TPS less than 1% were the assumptions beyond those statistical hypotheses.

And next, we'll move on to Ben Burnett with Stifel.

I had just a quick question on the CNS data. Just given the timing potentially at ASCO, is this something that might be included in the adagrasib drug label, if it's approved?

Yes. Great question, Ben. We're certainly going to have that dialogue with the agency as the data emerges, we'll have that with the agency. We'll try to have as much data as possible, put in the label, both preclinical and clinical data. No guarantees. We're certainly moving to get adagrasib approved as fast as possible. So I'd say as a minimum, the data will be published. If it's not available in the label, we certainly would like to go for a compendia listing, listing in the guidelines, clinical pathways until we're able to catch up with the label.

Okay. Understood. That's helpful. And if I could just kind of piggyback on the pancreatic discussion that we were just having. I guess what level of evidence is -- are KRAS G12D tumors equally as addicted as G12C tumors in pancreatic cancer. Just trying to get a sense for what to expect from a good G12D inhibitor in the setting? And if the adagrasib data might be somewhat predictive here. Any thoughts there?

Yes, I think that's a really interesting question. We've been looking at that as well. And I think there are some commonalities between G12C mutations in panc versus G12D. I think one of those observations is that, these appear to be the founding genetic event in this class of cancers going back kind now 20 years looking at the sequence of genetic events that move kind of pancreatic ductal adenocarcinoma from kind of pancreatic intraepithelial neoplasia, which is a very early lesion, those are caused by KRAS mutations. So at the very least, we would expect the founder mutation to demonstrate that the vast majority of tumor cells, if not all of them, are going to have the KRAS mutation. It's not going to be a heterogeneous or late acquisition of a genetic event.

Number two is when we look at disease modeling preclinically, we have tried to get our hands on every possible G12C pancreatic ductal adenocarcinoma model, looking both at topically and orthotopically with regard to implantation. We've logged certainly at -- a number of G12D models. And the data stacks up pretty well. The majority of those models are decreasing in tumor size at least 30% off and greater than 50%. So we have a paper that will likely be accepted here shortly, and it goes over the data in pancreatic ductal adenocarcinoma models for MRTX1133 and 11 -- 8 out of 11 of those models responded by tumor regression of at least 30%, often again, higher than that.

And then finally, if you look at kind of DepMap project drive and a lot of these large kind of functional genomic studies that have looked across hundreds, if not over 1,000 different tumor cell lines looking at the systemic knockdown of genes, both -- certainly G12D pops up as one of the strongest DepMap hits, including the enrichment for pancreatic ductal adenocarcinoma lines. It's one of the strongest dependencies found in those studies, if you look closely at DepMap mining. So you take those kind of 3 pieces of information and triangulate, we do believe that G12D is a very strong driver in panc and that there is likely some read-through for adagrasib.

And the patient population is significantly longer -- significantly larger, the G12D patient population of pancreatic, so prevalence is significantly greater than it is for G12C mutations patients.

Yes, just to build on David's comment, 36% of pancreatic ductal adenocarcinoma patients are going to have a G12D mutation. I believe the overall U.S. prevalence is around 40,000. All of those are a strong unmet medical need.

We'll move on to Maurice Raycroft with Jefferies.

This is Kevin Strang on for Maury. Just first on the Phase III, could you give any color into how the enrollment is going and whether or not you plan to open on any more sites than the 115 you have listed right now? And then how confident you are that you'd be able to enroll this prior to the December PDUFA.

Yes. A couple things. It's David, and Jamie can jump in too. For the confirmatory trial for adagrasib in second-line non-small cell lung cancer, for that, we're really encouraged by the increase in enrollment. With that, we've expanded the trial. It's a global trial at this time. So we've added a number of U.S. sites -- excuse me, European sites. Our partner Zai is helping us in Asia. So the recruitment is going well. Just for clarity, that trial does not need to be fully enrolled prior to an approval. That's per FDA regulations. However, we'll be well underway and we are well underway and will be very well recruited by the time we think adagrasib should be approved later this year. Jamie?

The only thing I would add too is that with the trial now opening globally, that's a major catalyst for enrollment. Those sites are really opening up in mass now, and we can certainly see an uptick in enrollment associated with the global opening of the trial.

Does that answer your question, Kevin?

Yes, it does. And then just a quick one on -- you've opened a couple new arms for your KRYSTAL study on (inaudible) for cetuximab combinations in small cell and PDAC. You've spoken before about -- and you've shown data for CRC. Can you just talk about your rationale for pursuing that combination in these indications?

Sure. EGFR and EGFR family have turned out to remain among very top combinations that we've observed preclinically is a very strong link to EGFR biology and KRAS. Certainly, that's been demonstrated first in colorectal cancer, but we also believe it to be important in lung and pancreatic cancers as well. So essentially, we want to double down and make sure that we are covering all of the options to be able to block both of those pathways. And due to the success of cetuximab and CRC, it certainly opened up some interest for us to look at that in other malignancies as well. So that's really the basis of us looking at that.

And next, we'll take Mike Ulz with Morgan Stanley.

Just 1 quick one for me on adagrasib in terms of your combination strategy beyond the PD-1 and cetuximab, you'd mentioned providing some of that data next year. But I'm just curious if you can remind us what dose of adagrasib you're using there? Is it the 600-milligram dose? Or are you considering using 400 as well?

Generally, when we started dose escalation, we're starting with 400 and then if that looks promising, we can go up from 400. So I would say we have combination trials ongoing right now with the 400 dose, and we have some combination studies that have escalated up to 600. So we're essentially looking at both. And just to say that we've done some analysis of the 400 dose with regard to PK exposures.

And as you can imagine, we constantly look at things like exposure response analysis in any of the clinical data sets that we've generated, and are highly confident that 400 mg BID is covering the target quite well. So any combination that we move forward with in a 400-milligram dose level, whether it be pembrolizumab or otherwise, the data exposure response, PK overall look quite promising at that dose level.

I assume we have time for 1 last question.

We'll take 1 last question from Yigal Nochomovitz with Citi.

This is Carly on for Yigal. We have 2 questions. First, I think you mentioned that you've begun medical affairs activities in preparation for the launch. So we're just curious if there are certain aspects of adagrasib's differentiation that you believe are resonating most with physicians, whether it's the PK properties, long half-life CNS penetrants or something else, any additional context you could provide there would be helpful.

And then the second question is just on G12D. We were just hoping to get an update on where you stand with the formulation work for that program.

So David, Ben and Jamie will answer this. Regarding medical affairs, medical affairs has been in the field since 2020. So they're rapidly approaching 2 years in the marketplace, so preparing the market for adagrasib as well as a KRAS G12C inhibitor. And the part of the story that the physicians find very appealing is the unique molecular profile. The 24-hour half-life, the time on target that adagrasib has reading to overall response rates, so physicians have been very appreciative and very excited about the 42% response rate that we have in our registration trial. So that's going over very well.

Also, the unique molecular profile Jamie spoke about earlier regarding CNS and brain mets and the activity we have there is also very appealing to physicians. So there's a couple data points regarding the medical affairs organization, the impact they're having. And Ben, other comments you would add.

I would just add one, doing a magnificent job and we have folks in both the U.S. and the EU focused on driving enrollment in the studies. From what we hear consistently back is that they are enthused by the molecular profile and 24-hour half-life. They do believe that that's part of the story and why we've seen some consistent results around response rates across tumors. And then on the brain mets from -- obviously, from a preclinical data, they're enthused and looking forward to seeing more of the clinical data. But they certainly ask us a lot about that data and are looking forward to the upcoming data presentation.

Okay. Yes. And on the G12D front, so I think as we've previously communicated, G12D, 1133 checks a lot of the boxes with respect to potency, metabolic stability, solubility and otherwise. But the intrinsic oral bioavailability is fairly low. And we initially started developing this as a standard IV formulation, but just weren't really satisfied with the duration of target coverage necessary to drive monotherapy activity. So we've shifted our gears into long-acting injectables.

One example of a long-acting injectable is a liposome-based formulation. And we've been, I think, encouraged by the preclinical data we've seen thus far, where we see strongly differentiated PK properties essentially extending the half-life of the 1133 in preclinical species that we've evaluated to date. And that is associated with achieving longer duration of target coverage.

And if we can set that up in a way where we can deliver the drug once a week or somewhere in that range, clinically, I think it's going to be more clinically feasible for us to develop that as a formulation approach. We do have other long-acting injectables that we're looking at as well. And those are also in process.

And then finally, we have discovered that there are some ways to enhance oral bioavailability or oral absorption of the drug. Those are ongoing, and I'd say, exploratory at this point, but if we can make progress there, it's possible that in addition to the long-acting injectable IV that we're advancing towards the IND track that there may be a life cycle strategy with other formulations that we could eventually move forward with this as well.

Yes. Thank you, everyone, for joining us today. And also thank you very much for your questions. As you got told from the team, we're really excited about the future of Mirati. We're well on our way to creating a leading biotech company with one of the most exciting and tangible target oncology portfolios in biopharma. There's a relentless focus at Mirati on translating novel science into innovative therapies that bring help to patients, and we look forward to speaking with many of you and sharing additional updates as we continue to progress toward our mission to discover, design and deliver breakthrough therapies to transform lives of patients with cancer and their loved ones.

Thank you. And that does conclude today's teleconference. We do appreciate your participation. You may now disconnect.