Rain Enhancement Technologies Holdco Inc (RAIN) 2022 Q4 法說會逐字稿

Greetings, and welcome to the Rain Oncology Fourth Quarter and Full Year 2022 Earnings Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Dan Ferry of LifeSci Advisors. Thank you. You may begin.

Thank you, operator, and good afternoon, everyone.

With me today on the phone are Avanish Vellanki, Chief Executive Officer of Rain Oncology; Robert Doebele, Chief Scientific Officer; Richard Bryce, Chief Medical Officer; and Nelson Cabatuan, SVP of Finance. During today's call, Avanish will provide an update on the broader strategic vision for the milademetan franchise, Bob will review the biology and rationale of p53 reactivation as it relates to our milademetan's clinical program, Richard will provide an update on Rain's clinical strategy, and Nelson will review the financials.

Before we begin, I'd like to remind you that statements made during this conference call that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon Rain's current expectations and involve assumptions that may never materialize or may prove to be incorrect. Actual results could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties as described in Rain's Annual Report on Form 10-K for the year ended December 31, 2022, filed with the Securities and Exchange Commission and other SEC filings. All forward-looking statements made during this conference call are based on management's assumptions and estimates as of today, March 9, 2023. Rain undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after today, except as required by law.

With that, I'd like to turn the call over to Avanish Vellanki, CEO of Rain Oncology. Avanish?

Thank you, Dan, and thanks, everyone, for joining us for our fourth quarter and full year 2022 earnings highlights and corporate update. To kick things off, we'd like to remind everyone of our name change to Rain Oncology in late 2022 to mark our anticipated growth as a dedicated and focused precision oncology business. We believe our new corporate name better reflects who we are and who we intend to remain.

As Rain continues to drive forward with our late-stage clinical program, milademetan or mila, our oral small molecule inhibitor of the MDM2-p53 complex, we'd like to approach today's call by providing context around our goal of demonstrating how p53 reactivation through mila's disruption of the complex could potentially be transformative in treating a broad range of cancer patients. In the spirit of this, we anticipate the readout from our MANTRA study to potentially serve as the first validation of p53 reactivation in a Phase III clinical setting. If the MANTRA top line data are favorable, we believe it will signify that reactivation of p53 matters. This will be an important validation as we begin to think about our initiatives beyond dedifferentiated liposarcoma or DD LPS. On today's call, we'll also provide highlights from our 2022 progress and achievements.

As a bit of biology review, we all know that p53 is the good guy in the story. We want active p53 to do what it's supposed to be doing, which is to protect us from cancer. Today, there are no approved therapies in the treatment of cancer that are aimed at restoring or reactivating this innate anticancer agent. Cancer, broadly speaking, needs to find a way to get rid of p53. We all know that mutations in p53, those instances when p53 is broken and can't bind DNA to allow p53 to do what it's supposed to do, occurs in approximately half of all cancers. In the other half, where p53 itself is not broken, cancer has to find other ways to get rid of it. MDM2 is a critical means of deactivating p53 in instances when there are no p53 mutations present. Therefore, in tumors that rely on MDM2 rig cells of p53 impeding the interaction of MDM2 and p53 could be a route to restoring p53 and make protective properties. And even if MDM2 is not over-expressed, further reactivation or enhancement of wild-type p53 levels might further enhance antitumor activity of targeted therapies to address other oncogenic drivers. There are a multitude of potential indications to be considered, especially the tolerability profile of mila enables a wide-ranging set of combination partners. We believe a positive outcome in the MANTRA study would legitimize p53 reactivation as a route to treat a range of p53 wild-type cancers. And in that scenario, milademetan could be the first inhibitor of the MDM2-p53 complex to be submitted and possibly approved by the FDA and other regulatory authorities around the world. Bob will provide additional color on the p53 reactivation story, along with insights from the recent publication in the Journal of Clinical Oncology, before Richard discusses how those data support the novel dose regimen of milademetan, which is optimized to reduce toxicities associated with MDM2-p53 inhibition.

Our clinical strategy while starting in DD LPS, based on the totality of the data present at the time of licensing the program in 2020 will aggressively move to larger patient populations based on the experience we have gained with mila in the clinic. We point out that after our initial indication in DD LPS, targeting approximately 1,400 patients per year in the US, our subsequent studies in the MANTRA-2 basket study targets 8,000 patients per year in the US and our third planned study, the MANTRA-4 study will target over 40,000 patients per year domestically. That pattern should convey how we approach creating value for the mila franchise and as we evaluate the potential of both monotherapy and combination opportunities across the approximately 50% of the cancer population possessing wild-type p53 tumors. I'll ask Bob and Richard to talk in more detail around recent data presented and the clinical strategy for milademetan.

I do want to comment briefly, however, on our preclinical research program focused on developing an inhibitor of RAD52. We have made a strategic determination to terminate this program. Based on data we have generated for the RAD52 research effort, we do not anticipate a meaningful probability of success. Therefore, we are electing to focus our resources on identifying new indications for milademetan or additional precision oncology programs via external licensing or internal development that may represent a more efficient deployment of capital for Rain.

In the prior quarter, we also remind you that we further improved our cash position with a $50 million registered offering concurrent with the release of the early MANTRA-2 data. We're excited to welcome several new large healthcare focused funds to Rain as part of that financing. Our year-end cash position of approximately $130 million provides a runway to complete all current ongoing and planned clinical trials of milademetan. This includes the Phase III MANTRA trial in DD LPS, for which data is expected in the second quarter of this year. It includes the ongoing Phase II MANTRA-2 basket trial and the planned Phase I/II MANTRA-4 basket trial, which we expect to commence by midyear.

With that, I'd like to turn it over to our President and Chief Scientific Officer, Dr. Bob Doebele. Bob?

Thanks, Avanish. Let's start by continuing the discussion around the rationale for p53 reactivation for the treatment strategy in cancer. MDM2 is a negative regulator of p53, blocking p53 transcriptional activity, promoting p53 export from the nucleus and ultimately targeting the p53 protein for degradation. Thus, dysregulated MDM2 can provide an alternate and important mechanism for p53 loss in tumor cells and therefore, facilitates oncogenicity. MDM2 upregulation can occur through a number of different mechanisms, including MDM2 gene amplification, MDM2 over-expression and/or MDM2 regulator loss. p14ARF is a negative regulator of MDM2 activity and is included by the CDKN2A gene, which is lost in a large percentage of cancers.

In January of this year, we published clinical trial data from the prior Phase I study of milademetan in the Journal of Clinical Oncology or JCO. This detailed the results of the first-in-class human Phase I study of milademetan that evaluated the safety, PK/PD and preliminary efficacy in patients with advanced liposarcoma, solid tumors or lymphomas. These results indeed showed restoration of p53 levels and activity in patients with various cancers. Tumor biopsies of patients treated with milademetan showed increased p53 protein levels and increased expression of p53 gene targets such as p21. Additional pharmacodynamic marker testing showed an exposure-dependent increase in the p53 target gene MIC-1 or GDF15 in patient blood samples following treatment with milademetan. Although all tested DD LPS patients had MDM2 amplification, median PFS and DD LLPs patients did not differ by levels of key biomarkers, including MDM2 or CDK4 copy number nor by mRNA expression levels of MDM2, CDK4 or MDM4. These data are consistent with our preclinical data showing that while MDM2 amplification is an important biomarker, higher levels of gene amplification do not correlate with increased milademetan sensitivity or improved clinical outcomes with MDM2 inhibitor treatment.

Moving on to the MANTRA-2 basket study. We continue to enroll patients with MDM2-amplified p53 wild-type solid tumors and plan to expand to additional sites worldwide with the goal of targeting full enrollment of approximately 65 patients across a range of solid tumors. Regarding the upcoming MANTRA-4 study, there is significant biological rationale to pursue combination of milademetan in an immune checkpoint inhibitor, in this case, Roche's atezolizumab or tecentriq. CDKN2A includes a critical regulator of the MDM2-p53 pathway, P14 RF. Loss of the CDKN2A gene therefore leads to increased MDM2 activity and decreased p53 levels in tumors. Preclinical work confirms that cancer salines with both CDKN2A loss and wild-type TP53 are sensitive to milademetan. Furthermore, CDKN2A loss is associated with poor clinical outcomes in patients with non-small cell lung cancer, bladder cancer and melanoma treated with immune checkpoint inhibitors even in those patients with favorable predictive biomarkers such as high PD-L1 or high TMB. Reactivation of p53 has been shown to lead to enhanced immune surveillance due to increased MHC Class I antigen presentation, interferon gamma signaling and other mechanisms. Based on this rationale, we are excited to launch the MANTRA-4 study in patients with CDKN2A loss and wild-type TP53, a population that could include more than 40,000 patients with solid tumors annually in the US.

The demonstrated ability of milademetan to reactivate p53, both in cancer models and patients as well as our early MANTRA-2 trial results have demonstrated that the MDM2 p53 complex matters in cancer biology. We have shown that milademetan, an inhibitor of the MDM2 p53 complex restores wild-type p53. Thus, milademetan should not be limited to liposarcoma as it may become part of a broader strategy to reactivate p53 in numerous tumor types that harbor wild-type p53. Ultimately, up to 50% of cancers may be addressable by disrupting the MDM2 p53 interaction. Given the critical importance of p53 and the large number of patients potentially affected by MDM2 mediated p53 loss, there is a great interest in targeting the MDM2-p53 complex to restore p53 activity.

And finally, as Avanish mentioned, we have terminated the RAD52 preclinical research program. Although the RAD52 pathway is likely to be critical in BRCA-deficient tumors, we did not achieve meaningful success with our early research efforts around this target because we determined that the current biochemical assays to screen novel RAD52 inhibitors did not correlate with the desired cellular effect of potency and selectivity. While we continue to evaluate additional avenues to innovate with biomarker-driven precision therapeutic strategies, we believe a better use of resources from the research team will be to evaluate the additional potential for milademetan across new indications in addition to evaluating other novel cancer targets.

At this point, I will hand it over to our Chief Medical Officer, Richard Bryce, to discuss additional updates around Rain's clinical trial pipeline. Richard?

Thank you, Bob, and good afternoon, everyone.

As both Avanish and Bob iterated, we recently published in the JCO the results from the Phase I first-in-human study of milademetan that evaluated the safety, PK, PD and preliminary efficacy in a range of tumor types, including dedifferentiated liposarcoma. We have adopted a novel intermittent dosing schedule of 260 milligrams daily given for three out of 14 days. Preliminary results from this study demonstrated encouraging single-agent activity in DD LPS, prompting our randomized Phase III MANTRA trial from which we expect top line data in the second quarter of 2023. Among the 53 DD LPS patients in the Phase I trial published in the JCO, the median progression-free survival of all patients regardless of dose and schedule was 7.2 months, which is already longer than that observed with the current standards of care of trabectedin or eribulin of approximately two months. And as previously discussed, for those patients who received the optimized dosing schedule of milademetan, the median PFS was 7.4 months. And within this cohort of 16 patients, when we exclude the five treatment-naive patients, the median PFS was actually 8.0 months. We believe these data further support the opportunity for milademetan to exhibit a favorable outcome in the pivotal MANTRA study.

Moving on to our Phase III MANTRA study. We previously announced that we had completed enrollment of 175 patients five months ahead of our prior year-end 2022 guidance. We believe the accelerated enrollment completion speaks to the tremendous unmet need in patients with DD LPS for which milademetan offers a targeted therapeutic strategy relative to standard cytotoxic options. We continue to affirm our expectations for top line data in the second quarter. As a reminder, this is an event-driven trial, requiring at least 105 progression events to trigger the primary PFS analysis. And our revised guidance to top line data readout reflects the number of PFS events taking longer to occur than originally anticipated. Rain met with the FDA and EMA prior to the start of the MANTRA study regarding the potential filing for marketing authorization. And we anticipate that if the MANTRA data are supportive, we would intend to submit an NDA to milademetan in DD LPS in the United States with similar submissions in Europe and possibly other regions as well.

Moving on to the MANTRA-2 basket study of milademetan in patients with MDM2-amplified tumors. We provided an update on the last quarter's call with the latest data cutoff date of October 26, 2022. And at that time, we reported two unconfirmed partial responses and two near PRs. Using the same three out of 14-day dosing schedule in this study, safety was consistent with what was reported in the prior Phase I study, with no new safety signals being observed. The toxicity profile and adverse event frequencies are consistent with the previous experience at this dosing schedule and also published in the JCO paper earlier referenced. We view these early data is encouraging with respect to both antitumor activity and safety, particularly in this histologically and genetically diverse set of patients. For our initial protocol, we are continuing to enroll up to 65 patients, and we'll be expanding the study to new sites, including several outside the US. At present, we have 12 active sites in the United States.

We are not providing guidance on the next data update from the MANTRA 2 study at this time. We previously stated that it would be most logical to present an update from the MANTRA 2 study when the data reveal the path forward. The MANTRA 2 study was designed with milademetan monotherapy across all solid tumors exhibiting a certain degree of MDM2 amplification. And if the data support meaningful confirmed responses across a range of cancers, we would intend to pursue a discussion with the FDA to better understand the requirements for a tumor-agnostic registrational filing. That is the preferred part, let's call it Path A. The timing of those discussions with the FDA, if at all, will be driven by the data. Path B, on the other hand, might represent a scenario where data suggests preferential activity in one or more tumor types, but not broad sensitivity. In this scenario, Rain might consider implementing tumor-specific expansion cohorts in the MANTRA-2 trial as part of a protocol amendment. In the event that milademetan were to not show sustained meaningful monotherapy activity across a broad range of tumors, Path C see might involve evaluation of a combination strategy. The most logical time to present an update on the MANTRA-2 trial will therefore be when we are better informed by the data to better understand which of those three potential parts might be the most appropriate way forward.

On to MANTRA-4. This is a Phase I/II trial designed to enroll 30 patients with wild-type p53 advanced solid tumors that also exhibit loss of function of the CDKN2A gene. This strategy could target over 40,000 patients per year in the US. We expect the start of MANTRA-4, our second tumor-agnostic basket study in the middle of the year. This trial will be our first combination regimen with milademetan using a checkpoint inhibitor, in this case, Roche's Tecentriq or atezolizumab. We recently pushed back the start of MANTRA-4 from the first quarter to middle of the year to accommodate the FDA's suggestions around this trial protocol study design.

With multiple clinical strategies for milademetan underway and in planning, we are excited by all the emerging and potential new clinical data and the associated potential commercialization opportunities and benefits to patients while providing a potentially best-in-class MDM2 inhibitor for patients across multiple tumor types.

With that, let me now turn it over to Nelson to review our financial results. Nelson?

Thank you, Richard, and good afternoon, everyone. I am pleased to provide an update of our financial results for the fourth quarter and full year ended December 31, 2022. I would also like to invite you to review our Form 10-K filed today for more details.

For the three months and the year ended December 31, 2022, Rain reported a net loss of 22.7 and $75.7 million, respectively, as compared to a net loss of 18 and $51.4 million for the same periods in 2021, respectively. Net loss per share for the three months and year ended December 31, 2022 was $0.70 and $2.71, respectively, as compared to a net loss per share of 0.68 and $2.65 for the same periods in 2021, respectively.

Research and development expenses were 19.1 and $61.4 million for the three months and year ended December 31, 2022, respectively, as compared to 14.7 and $40.8 million for the same periods in 2021, respectively. The increases were primarily related to clinical trials cost per mila, higher payroll-related costs for our R&D personnel and various other R&D costs per mila. Non-cash stock-based compensation expenses included in R&D expenses were approximately 1 and $3.8 million in the three months and year ended December 31, 2022, respectively, as compared to 1.1 and $2.5 million in the same periods in 2021, respectively. General and administrative expenses were 4.5 and $15.7 million for the three months and year ended December 31, 2022, respectively, as compared to 3.4 and $10.7 million for the same periods in 2021, respectively. The increases were primarily due to the higher payroll-related costs for Rain's G&A personnel, outside consulting, legal costs and various third-party G&A costs. Non-cash tax-based compensation expense included in G&A expenses were approximately 0.3 and $1.1 million for the three months and year ended December 31, 2022, respectively, as compared to 0.2 and $0.6 million for the same periods in 2021, respectively. Total non-cash stock-based compensation expenses were approximately 1.3 and $4.9 million for the three months and year ended December 31, 2022, respectively, as compared to 1.3 and $3.1 million for the same periods in 2021, respectively.

As of December 31, 2022, Rain had $130.5 million in cash, cash equivalents and short-term investments. Rain will not provide guidance on cash runway at this time. We will continue to assess our cash runway and provide further guidance, if appropriate, after the release of our MANTRA top line results in the second quarter of this year. As of December 31, 2022, RAIN had approximately 36.3 million shares in common stock outstanding.

With that, I'll now turn the call back over to Avanish.

Thanks, Nelson. With that, we'll be happy to answer any questions. Operator?

Thank you. We will now be conducting a question-and-answer session. (Operator Instructions) Our first question is from the line of Michael Schmidt with Guggenheim Partners.

I had a follow-up on your comments regarding MANTRA- 2. I think you mentioned some different potential clinical avenues you could take in the future depending on how the data pans out. I guess can you comment a little bit about how enrollment in this study has been going since you lowered the MDM2 amplification cut-off recently. I know you've added some more sites as well. And then, I guess, how many patients worth of data would you need to see to feel comfortable to determine next development steps for the basket study.

It's Avanish. Let me take that one. So in terms of how many more patients are we going to need to see before we figure out the next step, that's a hard one to answer before we see the data. It's certainly going to be highly dependent on the data. And certainly, I think it may be reasonable to think that the more patient data that we have, the more confidence we're going to have in the next step. So that may be a function of how much confidence we want to have, which we can't comment on today without seeing the robustness of the results.

In terms of the first part of your question in terms of where we sit today with enrollment, we have said previously that since the initial interim update, we have seen an acceleration of enrollment, but we're not providing clarity today on where that enrollment currently sits. But we certainly did see an uptick since that initial update back in November and the dropping of the copy number threshold, as previously stated.

And then just on MANTRA, I mean as we are closing out the first quarter soon, have you reached or can you comment if you have reached the number of required events at this point? And if not, are you planning to disclose that publicly?

No, we are not disclosing whether or not we've hit the number of events and we don't plan to.

Our next question is from the line of Joe Catanzaro with Piper Sandler.

Maybe one following up on the last one. I appreciate you're not going to disclose when you hit events, but wondering if you could comment around your expectations around the amount of time it will take to lock the database, clean the data and run the stats. And then maybe just a follow-up on MANTRA-4. Just curious if that trial is taking into consideration any prior exposure to prior immune checkpoint inhibitor? And if so, what are some of those considerations?

So regarding the MANTRA, yeah, I mean there's a sort of standard seven weeks between sort of database cleaning and then having the final data set ready for analysis. And as you can imagine, I mean, this is a complex study with a number of different vendors involved with various components of the study. So it will take several weeks to do that. And beyond that, I'm not really going to comment on, within our control and some is with the external vendors to finalize and transfer their databases.

I think your second question concern MANTRA-4. So the study is designed for checkpoint immune refractory patients. So they all have failed resistant or refractory to prior IO therapy before they come on to our trial in combination with atezolizumab.

Our next question is from the line of Soumit Roy with Jones Research.

One question on MANTRA-2 trial, the basket study. How extensive are the background genomic mutation status analysis are you doing? Are you just primarily focusing on the known obvious mutations in pancreas or breast and lung or is it fairly extensive.

It's actually a very extensive analysis. So you'll recall that we're using Tempus as our diagnostic vendor. So all patients are getting the Tempus xT test, which is currently comprised of more than 600 genes really comprehensive and covers almost all cancer-related genes.

Got it. And are you doing any parallel preclinical analysis with those kind of co-mutations in the system to see if there is a p53 activation without adding any combination agent?

We've published several models already, some which have co-alterations and we believe that there is a reason to think that there should be activity even in patients with co-alterations.

Next question is from the line of Jeff Jones with Oppenheimer.

Two questions. In the basket trial, what type of signal are you looking for that would be considered supportive of approval down, call it, Path A?

And then a follow-up question to Bob's discussion on the mechanism of action. Something I only caught part of. You had mentioned that higher levels of MDM2 amplification didn't necessarily correlate with higher sensitivity. Could you give a little more detail on that?

So in terms of the threshold, again, it's a bit of a guessing game, but based on several agnostic approvals by the FDA for targeted therapies. We believe that the response rate probably needs to be in the range of around 30%, obviously, with reasonable durability. So that's the benchmark for an agnostic path for MANTRA 2.

In terms of the MDM2 copy number, we've received a lot of questions about whether higher copy number may lead to better sensitivity. And I think you'll recall several pieces of evidence that suggest that no, there is no correlation. As long as you have some level of MDM2 amplification that may be still an unknown target what that level is, but higher levels don't necessarily predict for that. So we looked in the U101 study and looked at clinical outcomes versus copy number and patients with higher copy numbers in liposarcoma did not fare better than patients with lower copy numbers of MDM2. We've also seen no correlation yet also in the MONTRA-2 study. And then you'll recall that we've also said that in preclinical data, there's no correlation between copy number and sensitivity to milademetan. So as long as we're above a certain threshold for amplification, greater amplification doesn't seem to predict for better outcome.

Our next question is from the line of Yigal Nochomovitz with Citigroup.

I had three quick questions. On MANTRA 2, I think you mentioned that the Part C scenario would involve potential combos. I'm curious what you could say more there in terms of which combos, whether you'd use the atezo or something else?

And then on RAD52, I'm just curious did you expand a little bit on the lessons learned from that program. I think you mentioned something about the assay sensitivity not necessarily correlating with potency, if I understood that correctly, and how that might help you with target selection in the future?

And then third on MANTRA, I know you have to hit the 105, and you can't comment. But can you say the frequency with which you're actually checking the events these days? Is it weekly, every few weeks? And is it possible that you might exceed the 105 at the point where you actually do the analysis?

I'll take the first one around the potential combos. I'll hand the rest of your question over to Bob and then have Richard address the frequency of checking the MANTRA events. So for the first part for MANTRA 2, the Path C, it doesn't necessarily just need to be atezolizumab for additional combinations. I think we will refer you to some of the recent discussed data in combination with other non-IO combination partners such as MEK inhibitors. So we will certainly look to other combinations that are far more broad reaching than just atezolizumab and just other IO strategies. But we're not ready to comment specifically on what we're planning to do there without knowing which path we're going to go down.

For RAD52, I'll turn it over to Bob.

Yeah. So Yigal, in terms of the RAD52 program, just to give a little bit more clarity, the goal of our screening was to identify biochemical assays that would predict potency in BRCA-deficient but not BRCA expressing cell lines. So again, potency and selectivity. Unfortunately, none of the existing assays that we used, we're able to give that. And so we weren't able to meaningfully progress candidate chemical compounds further based on that lack of valuable screen. Obviously, we think it's an important target still perhaps given more time and not a need to prioritize other programs, we might have continued, but we believe that it would take a significant amount of time to get to a meaningful drug in that space.

Time and money. And the third question with regards to the frequency of MANTRA checking the number of events, Richard?

So currently, we have the data transfers from the central readers, the blinded independent review committee every two weeks. The events are relatively infrequent at the tail end as you would expect. And so the second part of your question was could we potentially analyze greater than 105 events, Absolutely. It will depend on how many north, if you like, of 105, which is the minimum will be in that data transfer.

Our next question is from the line of Sam Slutsky with LifeSci.

Two from my end. I guess, first, for the control arm assumption of three months in the ongoing MANTRA study, I realize that there's literature showing about a two-month PFS with trabectedin and DD LPS, which you referenced. Could you remind us if there's other data that have been published or trabectedin and DD LPS specifically? If so, what have they shown? And then is there any notable difference on inclusion, exclusion between MANTRA and prior studies?

Yeah. So obviously, the literature that we're referring to in the 2.2 months is the prospective registrational trial of trabectedin. We believe that's the most useful data-set. All other data that has been published has either been small, single institutional studies or retrospective data, which is never as rigorous or unbiased as a Phase III registrational trial. So there may be some variations there, but we believe the largest study and the most meaningful in a prospective study of trabectedin and that led to its registration.

Got it. Okay. And then assuming that lower milademetan ultimately gets approved for DD LPS, just remind us how big of a sales force you think you'll need in the US and then how you're thinking about ex-US strategy?

So again, it's a smaller patient opportunity, we think, in the range of 25 to 35 sales reps in the US would be sufficient. And the strategy currently entails pursuing commercialization effort in the US from Rain, but partnering ex-US.

Our next question is from the line of Graig Suvannavejh with Mizuho Securities.

I had a couple. But one, if you could just remind us with the MANTRA study, the powering assumptions and what you need to show in order for the trial to be considered to win? Is it simply just stat fig? Is there some other elements of whatever you need to see that would make it a clear win? That would be helpful.

And then my second question just has to do with the timing of when you'll get the readout. I know that the guidance is second quarter, but just wanted to get your thoughts again on how confident you feel that second quarter is the appropriate timeline and that it won't potentially slip further?

We're not going to provide any additional granularity beyond the second quarter timeline. And currently, we are highly confident that it will be in that quarter. So hopefully, that addresses the second part of your question.

Richard, if you want to review the powering assumptions for MANTRA.

Sure. So as we've previously disclosed, Graig, the study is powered at 94% to show a hazard rate of 0.50. So we're estimating within the study three months versus six months difference that is 94% and then the standard 5% type 1 error two-sided type 1 era.

And maybe just a quick follow-up. I was curious as to the comments from a financial side of things. So I guess this is for Nelson. Just the comments around, I guess, the withdrawing of cash runway guidance versus the prior guidance from the third quarter that you had runway to 2025. It's something I haven't really seen before. And I know you had some prepared comments, but I'm just curious as to why you decided to change the language per se, especially in light of the recent equity raise.

So that really is predicated on the proximity of the top line results for MANTRA, knowing the extent of the activities that we need to do after that. The prior guidance that is relevant anymore. So as I've said in the prepared comments, we will continue to evaluate this in the top line data, and we'll provide further guidance after that is appropriate.

And just to follow up on that, Graig. There's been no meaningful change in terms of our expected cash burn rate. So we don't want to convey that we are withdrawing guidance because of some meaningful change in the business. It's just that given a very near-term large catalyst, which will influence the path forward.

Our next question is from the line of Mitchell Kapoor with H.C. Wainwright.

I wanted to start off with MANTRA 2 and just talk about those patients. So you've shown efficacy in patients with a median of four prior lines of therapy. But I wanted to kind of relate that to the population that you continue to enroll and trying to understand, are they more or less healthy? And does a higher copy number have anything to do with this disease parity?

I'll turn that question over to Bob in terms of the profile of the patients on MANTRA 2. But just as a broad comment, we're not providing any meaningful detail around what we're seeing in terms of the patients being enrolled just yet. So we can give you a lot of color, but I'll turn it over to Bob to add any additional color you can add.

Yeah. If I can understand your question, well, we haven't changed any of the other inclusion exclusion other than copy number. So that's unlikely to change the number of prior lines of therapy. We know that MDM2 gene amplification as a whole carries a worse prognosis. But again, we don't think that the change in copy number is going to necessarily affect the kind of clinical status of the patients in terms of prior lines of therapy or other in meaningful clinical characteristics.

And then on MANTRA 4, just wanted to understand a little bit of the rationale for the pushback. I know you had mentioned that FDA recommendations were some of the reasons, but could you just comment a little bit more on why that might be?

So I mean, there's nothing contentious there. Broadly speaking, I mean, I won't go into the fine detail, but broadly speaking, there was some helpful suggestions around the -- essentially the inclusion criteria and some stocking rules, which we were very happy to implement and incorporate into the protocol. So that was essentially it. Nothing major or contentious at all.

Our next question is from the line of Tony Butler with EF Hutton.

Two very brief questions, if I may. One is, what is the rationale or may ask the rationale for utilizing a PD-L1 antibody. I mean I recognize you've got a supply agreement with Roche versus a PD-1 antibody. And I say this really for a couple of reasons, but one is in your K, you do make a comment about nonclinical data in immune-competent mouse models in CRC with CDKN2A loss did demonstrate some common control activity within a PD-1. So that's question one.

And the second question is in patients that actually respond to milademetan, let's assume that these are in liposarcoma patients and then at some point, progress, do they progress because there's a second site mutation or do you have a hypothesis as to where that exists or is there some other explanation?

I'll turn the first part of the first question, the nonclinical rationale for the IO combination with Mila to Bob before turning it asking Richard to comment on the reason for the PD-L1 versus the PD-1. Let's address that first question first. Bob?

Yeah. So in terms of patients progressing on milademetan, and I think this could apply to our MANTRA study with liposarcoma patients or really any patients. I would say we are not expecting second site mutations within MDM2. The binding pocket that our drug binds to is the same pocket that p53 binds too. So mutation there, we believe, would be likely to disrupt binding with p53. So that's I think unlikely, but something we can look at. The expected resistant pathway, and there's been some both preclinical and clinical evidence for this is the emergence of p53 mutations. There could be other mechanisms as well, and we have the ability to monitor and look at those resistance mechanisms through the use of ctDNA analysis.

And I believe that was your second question, Tony. So on the first part, I think you're asking about the nonclinical support that we have for the combination of an IO agent and milademetan. Is that right?

Yes. But in the K, Avanish says an AP PD-1, so I'm trying to split anti-PD-1 from PDL1. And if there was a rationale for one over the other because you have chosen atezo in the MANTRA 4 study.

Yeah. As you know, PD-1 and PD-L1 really target two sides of the same binding interaction. So we don't see a meaningful difference between the two clinically or pre-clinically. That's the short answer.

I think there are some clinical models, which suggest that there are differences, RCC being one and clearly one being another. But it's irrelevant maybe as it applies to where these are at least being tested. So I'm grateful for that, Bob.

Our next question is from the line of Kumar Raja with ROTH Capital Partners.

Again with regard to the MANTRA 2, part B where you are thinking about one or two histologies, how do we get there given that we are seeing such a diverse histology in the interim data.

So the question was with respect to Path B of the scenarios we're considering for MANTRA 2, how do we get there because we've already seen activity across multiple tumor types. Did I restate that correctly?

Yes. And also trying to get a sense like whether you think that there will be -- you'll be reaching for some populations there or just trying to get a sense how we get from like seven or eight to like one or two.

As a reminder, we showed two early unconfirmed PRs. One of those patients with the PR was going to remain unconfirmed because of a death due to COVID. And then we had two near PRs. So as of the cutoff back in October, so four different tumor types with encouraging activity. Now since that moment in time, we're not reviewing any additional patient data, but we'd want to make sure that we see meaningful confirmed responses, again, preferably across a range of tumor types. Now I think scenario B, Path B, as we highlighted, suggested that if we start seeing confirmed responses with meaningful durability in a couple of tumor types, maybe a few tumor types that would be the scenario where we also do not see confirmed responses in a range of other tumor types. So from the point of interim data release, again, we're not providing you any additional color on this call, but I think we would want to see confirmed responses with meaningful durability of response. And if we see that only in a few tumor types, that would be the Path B that we highlighted.

And also in terms of the patient population size, right, like looks like breast and lung cancer as well as bladder, those are the predominant ones with greater than eight copy numbers. So how should we think about it?

So it's still too early to tell, but I'll ask Bob to review for the MDM2 AMP patient frequencies, what the top tumor types are just in terms of absolute patient numbers, but we are too early to make a call on where it's going to go.

Yeah, you'll recall that the top three tumor types are breast, lung and bladder. So those three tumor types comprise about 75% of all the MDM2 amplified patients. Obviously, they have a very large incidents in their own right. And for the majority of MDM2 amplified patients fall into one of those three tumor histologies. The remaining 25% obviously are made up of multiple different tumor types.

Thank you. As there are no further questions at this time, I would like to turn the floor back over to Avanish Vellanki for closing comments.

Thanks, operator, and thanks to everyone that dialed into our call today. As a reminder, we expect top line data from the pivotal Phase III milademetan trial in dedifferentiated liposarcoma in the second quarter of this year. We also anticipate the start of the Phase I/II basket study, the MANTRA-4 study in patients with p53 wild-type advanced solid tumors that have CD that have lost CDKN2A gene function around middle of the year. So we believe this will be an exciting year for Rain and the mila program, and we look forward to providing further update after the first quarter of 2023. Thank you.

Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.