Oncternal Therapeutics Inc (ONCT) 2021 Q3 法說會逐字稿

Greetings. Welcome to the Oncternal Therapeutics, Inc. Q3 2021 Financial Results Call. (Operator Instructions) Please note, this conference is being recorded.

I will now turn the conference over to your host, Rich Vincent, CFO. Thank you. You may begin.

Thank you, Alex. Good afternoon, everyone, and thank you for joining us today. Joining me on the call this afternoon are our President and CEO, Dr. James Breitmeyer; and our CMO, Dr. Salim Yazji. We welcome all of you. Today's call includes a business update and discussion of our third -- 2021 third quarter financial results and upcoming milestones, which will be followed by Q&A.

Today's press release and a replay of today's earnings call will be available on the Investor Relations section of Oncternal's website for at least the next 30 days. We also filed our 10-Q for the third quarter 2021 earlier today.

Please note that certain information discussed on today's call is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. We will be making forward-looking statements during this call about future events such as our business and product development strategies and future financial and operating performance. Our actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with our business. These forward-looking statements should be considered in conjunction with and are qualified by the cautionary statements contained in today's press release and our SEC filings, including our Form 10-Q for the quarter ended September 30, 2021.

This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, November 4, 2021. We undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances occurring after the date of this conference call.

With that, it's my pleasure to hand the call over to our CEO, Dr. Jim Breitmeyer.

Thank you, Rich, and good afternoon, everyone. At Oncternal, we are committed to developing novel treatments for patients with cancer who have critical unmet medical needs. We're advancing a recently expanded and robust product pipeline with clinical and preclinical product candidates that target several such cancer indications. Our development efforts focus on biological pathways implicated in cancer genesis and progression.

I'd like to discuss ROR1 first. We believe we have one of the most advanced and diverse pipelines targeting ROR1 based on our deep expertise and experience with this target. Our lead asset, ROR1-inhibiting antibody, cirmtuzumab, we're announcing today has a new generic name and its INN will be zilovertamab from now on. We will be presenting updated results from our ongoing Phase Ib/II clinical trial with zilovertamab plus ibrutinib in patients with mantle cell lymphoma or chronic lymphocytic leukemia at the American Society of Hematology Annual Meeting in Atlanta in December of this year.

You may have noticed that interim results in our abstract, which were based on June data, are available as of today on the ASH website, and we look forward to presenting updated data during our ASH poster presentation on December 13.

Our ongoing interactions with the U.S. FDA regarding potential registration pathways for zilovertamab are progressing well, and we expect to agree on a pivotal study design for patients with mantle cell lymphoma, MCL, in the coming months. ROR1 remains an increasingly visible target in the oncology space since it was the subject of M&A activity, including the acquisition of VelosBio by Merck & Co. and NBE-Therapeutics by Boehringer.

VLS-101, which is now known as MK-2140, is VelosBio's ROR1-targeting antibody drug conjugate, or ADC, and was originally invented and developed at Oncternal. This ADC utilizes zilovertamab as the ROR1-targeting moiety.

We also continue to collaborate on 2 investigator-sponsored clinical studies of zilovertamab at UC San Diego. First, a Phase Ib clinical trial of zilovertamab in combination with paclitaxel for the treatment of women with HER2-negative metastatic or locally advanced, unresectable breast cancer has completed enrollment. Second, a Phase II clinical trial of zilovertamab in combination with venetoclax, a Bcl-2 inhibitor in patients with relapsed/refractory CLL, is ongoing and enrolling patients.

With respect to our ROR1-targeting cell therapy programs, we continue to advance them toward the clinic as planned. For our lead autologous CAR-T program, which we have selected -- for which we have selected ONCT-808 as the lead, we have made tremendous progress in GMP process development with our CDMO collaborators and are completing IND-supporting preclinical studies with leading academic institutions to enable the submission of the first IND in the first half of 2022.

We also made progress regarding potential second-generation allogeneic cell therapy programs. We established a partnership with Celularity to evaluate placental cell-derived therapies targeting ROR1. And we strengthened our partnership with the Karolinska Institutet in Sweden, including recently joining NextGenNK, the institute's competence center for the development of next-generation NK-based cancer immunotherapies.

We also recently announced that we have engaged a group of industry-renowned experts in the cell therapy field to serve as our cell therapy Scientific Advisory Board and to support our efforts to bring safer and effective ROR1-targeting cell therapies to patients faster. We at Oncternal and our newly formed SAB are very excited about the potential of our cell therapy programs targeting ROR1, which may allow for the selective targeting of tumor cells that express ROR1 while relatively sparing healthy tissues.

In another program, we also advanced the development of ONCT-216, which was formerly designated TK216, our investigational targeted small molecule inhibitor of the E26 transformation-specific, or ETS, family of oncoproteins. We look forward to the oral presentation of an interim clinical data update next week at the Connective Tissue Oncology Society, or CTOS, 2021 Virtual Annual Meeting.

The additional Phase II expansion cohort is now open and enrolling Ewing sarcoma patients and is evaluating single-agent ONCT-216 using an intensified dosing regimen designed to increase the amount of ONCT-216 that is administered over time.

Now I'd like to provide an introduction to the latest addition to our pipeline. We have designated ONCT-534 as the lead candidate in our preclinical dual-action androgen receptor inhibitor, or DAARI, D-A-A-R-I, program. ONCT-534 was originally developed by the University of Tennessee and was acquired by Oncternal as part of our reverse merger with GTx in 2019.

A substantial body of evidence from in vitro and in vivo studies has been developed that strongly suggests that ONCT-534 is active on both the end terminus and the ligand-binding domains of the androgen receptor, in addition to causing degradation of the receptor. The molecule is active in preclinical prostate cancer models that are resistant to current standard of care therapies such as enzalutamide and abiraterone. We believe ONCT-534 may have the potential to address the significant unmet need for men with prostate cancer caused by tumor resistance mechanisms, including those involving expression of androgen receptor splice variants such as AR-V7.

With that, I will now turn the call over to Rich Vincent to review our financial results and upcoming milestones.

Thank you, Jim. In October 2017, CIRM awarded an $18.3 million grant to researchers at the UC San Diego School of Medicine to advance our Phase Ib/II clinical trial, evaluating zilovertamab in combination with ibrutinib for the treatment of patients with B-Cell Lymphoid Malignancies, including MCL and CLL. We are conducting this study in collaboration with UC San Diego and expect to receive approximately $14 million in development milestones under research subawards throughout the award period.

In conjunction with this award, our grant revenue was $2.4 million -- $2.1 million for the third quarter ended September 30, 2021. Our total operating expenses for the quarter ended September 30, 2021 is $11.8 million, including $1.5 million in noncash stock-based compensation. Research and development expenses for the quarter totaled $9 million, and general and administrative expenses totaled $2.8 million.

Net loss for the third quarter was $9.6 million or a loss of $0.19 per share, basic and diluted. As of September 30, we had $97.4 million in cash and cash equivalents. We believe these funds will be sufficient to support our operations into 2023.

As of September 30, we had 49.4 million shares of common stock outstanding.

With respect to upcoming milestones for our zilovertamab program, we expect a clinical data update for the ongoing Phase Ib/II study in MCL and CLL during the 2021 ASH Annual Meeting on December 13, an update regarding our ongoing FDA interactions regarding potential registration pathways for zilovertamab in patients with MCL.

For ONCT-216, we will report updated clinical data from our Ewing sarcoma Phase I/II study next week during the 2021 CTOS Annual Meeting. On the cell therapy front, we are advancing our autologous ROR1 CAR-T cell program, ONCT-808, and plan to submit the first IND in the first half of 2022.

We are also looking forward to hosting an R&D Day on January 25, 2022, where we will provide a comprehensive strategic update on all of our programs and key development priorities. This will include insights from key opinion leaders in the field of MCL therapies, cellular immunotherapies as well as androgen receptor resistance in prostate cancer.

Now I will turn the call back over to Jim.

Thank you, Rich. In closing, we are very encouraged by the progress on all our programs. We continue to have a strong balance sheet, and we have a very strong management team. There are important catalysts for the company in the months and quarters ahead, including particularly agreement with FDA on a registration path for zilovertamab, clinical data readouts for zilovertamab and ONCT-216 and advancement toward the clinic for our ROR1-targeting autologous CAR-T therapy candidate, ONCT-808, as well as for our dual-action AR inhibitor prostate cancer candidate, ONCT-534.

I look forward to updating you in the coming banking conferences and at our R&D Day on January 25. Thank you for joining us today.

With that, I'll turn things back to Alex for the Q&A portion of this afternoon's call.

(Operator Instructions) Our first question comes from the line of Hartaj Singh with Oppenheimer & Co.

Just a couple of questions. Jim, I know you're going to smile on this one because you always get it. So I have to ask it. With zilovertamab, you've been having, I guess, FDA interactions, and you have been indicating that you will give an update to investors in the next few months. Has your thinking changed with these interactions as to what the parameters or the contours of the clinical development plan could look like in MCL? So that's number one. Any updates there?

And then number two, your ROR1 CAR-T cell therapy, the IND is planned for the first half of 2022. What kind of clinical development plan do you foresee once that IND comes through? Is it going to be sort of a dose escalation to dose expansion? What kind of tumors basket study, et cetera? Would love to get some color there.

Sure, Hartaj. And so I think that the interactions with FDA have been open, collegial and very helpful. And so what I'd say has evolved with the -- the latest information that we provided them was the clinical results from the ASCO meeting. And I'm sure you'll recall that the -- some particular clarity in the ASCO data set emerged that zilovertamab plus ibrutinib is providing a very encouraging progression-free survival compared to ibrutinib alone. And so that entered into our discussions with them and plays into study design for registration studies that we're discussing with them.

I think we've discussed on previous calls that we are considering that it's likely to be a randomized study of BTK inhibitor alone versus BTK inhibitor plus zilovertamab. And so with encouragingly stronger results for complete response and overall response and progression-free survival, that gives us some very interesting material for negotiating trial designs.

So that's your first question. Let me turn over to Salim, our Chief Medical Officer, to discuss the potential shape of a CAR-T clinical development program.

Yes. Thank you, Jim. So actually, yes, we are very excited about the CAR-T program. And what we're planning to do is a Phase I dose escalation to get to a recommended Phase II dose as well as we will be using most likely the B-cell malignancy patients at the first in-human study.

Great. And the B-cell malignancy -- I mean, just from your preclinical modeling, are there any tumor types that you expect to be -- that you think could be more useful for 808 versus others?

Well, I mean, in the B-cell malignancy, we're looking at mantle cell, we're looking in ALL. We're probably going to look into diffuse large B-cell lymphoma. So that's what we'll be looking for as a first try.

Great. And then just last question from me, which is on the HER2-negative breast cancer. Any updates there that you plan in 2022? And I'll jump back in the queue.

Okay. Thank you, Hartaj. Go ahead, Salim.

Yes. Sorry, Jim. Yes. Let me remind you that the breast cancer study is an investigator-sponsored study, and the timing of the data release is usually in the PI's hand. However, with that said, Jim has mentioned earlier, the study has been fully enrolled and hopefully will be published soon.

Our next question comes from the line of Carl Byrnes with Northland Capital Markets.

Congratulations, by the way, on your progress. Just real briefly, do you have any thoughts in terms of the timing of IND-enabling studies for ONCT-534? And then also, to the extent you can speak on the research collaboration with Celularity and also the Karolinska Institutet, which you recently announced, in terms of when you might see identified candidates there.

Carl, thank you. And I think I can handle both of those questions. So for 534, we have selected the molecule, and with -- and you're familiar with the drill on getting to an IND that in the early going, manufacturing is usually rate-limiting to get to material -- representative material that you can use for your IND-enabling studies. And so we're not ready to guide on when the IND might be ready to submit. But with the -- but I think that the -- you can expect that there will be IND-enabling studies underway next year, certainly.

And then with the -- with Celularity and the Karolinska, we will also be expecting to have data emerging from those collaborations next year. Again, we're not guiding specifically because we're not in control of the work that's being done in those laboratories. But I will say that we're feeling quite upbeat about both of those.

And the -- overall, what I'd say is that you can expect the next-generation cell therapy to be running somewhere very roughly around a year behind the lead autologous CAR-T program.

Our next question comes from the line of Kumar Raja with Brookline Capital Management.

I'm [Shubhendu] calling in for Kumar. Appreciate the update. With respect to the preclinical results of the CAR-T program, I was wondering if you could give some color to the persistence of ONCT-808 CAR-T cells in the body. And I'm just trying to get an idea of how long-lasting the therapy will be. And also, what percentage of antigen escape do you estimate for ONCT-808 that could be important for a cancer relapse scenario?

Thank you. Those are both good questions. And so as far as persistence goes, we're -- you're probably aware of some work that was done by investigators at the University of Washington in Seattle at the Hutch with a ROR1 CAR-T that had rather short persistence. And we think we understand why that was. It is -- we think it's because they used a rabbit antibody fragment to target ROR1. And as a result of that, the CAR-T that they administered had foreign antigen rabbit protein on the surface and we think contributed to low persistence. The -- we expect the -- our ROR1 CAR-T, which will have a fully humanized targeting moiety on the outside, to escape this immune clearance and have a significantly longer persistence.

The antigen escape question is a great one because CD19 escape is -- has emerged as a very significant problem in the CAR-T space. And so we are hopeful that ROR1-targeting will circumvent some of that CD19 problem. The reason we're hopeful about that is that CD19 is not an essential component to the B-cell malignancy's biology or survival.

In contrast, ROR1, which is not normally expressed on adult B-cells is conferring survival and aggression and invasion characteristics to the cell. It's an active signal transducer. And so if -- and it's been shown that if you suppress ROR1 from a ROR1-expressing tumor, the resultant ROR1 negative cells are not very malignant. They are -- they have lower tumor-forming potential and a lower aggression pattern. So we're hopeful that ROR1-negative escape will be less common than it has been with particularly CD19.

That was very useful. You mentioned that the initial plan is to test ONCT-808 in B-cell malignancies. I was just wondering if there are any -- if you are thinking in terms of testing it in solid cancers as well.

Salim, do you want to talk about that?

Yes. Absolutely. So I think our first generation will be in the B-cell malignancy. And as we will develop our ROR1 cell therapy, I think a solid tumor will be targeted as well.

Thank you. Ladies and gentlemen, we have reached the end of the question-and-answer session. I will now turn the call over to Dr. Jim Breitmeyer for closing remarks.

All right. Thank you, everybody. We appreciate your interest and attention for our third quarter release and overview. We look forward to seeing you, we hope, at our January 25 R&D Day, which will provide a review of our pipeline and priorities and offer insights from key opinion leaders in MCL and CAR-T and androgen receptor biology.

With that, thank you, and goodbye.

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.