Rigel Pharmaceuticals Inc (RIGL) 2016 Q1 法說會逐字稿

Good afternoon, and welcome to Rigel Pharmaceuticals Earnings Conference call for the First Quarter 2016. (Operator Instructions)

I would like to remind you that this call is being recorded for replay purposes from Rigel's website. (Operator Instructions)

And now I will turn this conference over to our first speaker, Dolly Vance, who is Rigel's Executive Vice President, Corporate Affairs and General Counsel.

Hello, and welcome to our quarterly earnings conference call. The financial press release for the first quarter of 2016 was issued a short while ago and can be viewed on the News section of our website at www.rigel.com.

As a reminder, during today's call, we may make forward-looking statements regarding our financial outlook and our regulatory and product development plans. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found in our most recent quarterly report in Form 10-Q on file with the SEC. Any forward-looking statements are made only as of today's date, and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances.

At this time, I would like to turn the call over to our CEO, Raul Rodriguez.

Thank you, Dolly, and good afternoon. During our earnings call in March, I spoke about the excitement at Rigel as we prepare for the top line results from the fostamatinib studies later this year. The last few months had been very busy. In fact, I'm happy to report that we have achieved our objectives for the first quarter of the year. Both of the ITP Phase 3 studies have completed patient enrollment and are ongoing. Based on that enrollment and the time required to organize the data, we expect a mid-year readout for the first of these two studies and the readout for the second study to follow shortly thereafter.

In the meantime, we are making significant progress towards becoming a commercial enterprise. Our clinical and regulatory affairs teams are preparing sections of the NDA for fostamatinib and ITP. We hope to submit the NDA application to the FDA by the end of the first quarter of 2017.

In addition, we are actively engaged in planning for the commercial launch of fostamatinib in the U.S. This will include hiring key people to build our commercial and medical affairs capabilities in the upcoming months.

Beyond ITP, the next fostamatinib project is autoimmune hemolytic anemia. During the first quarter, we announced that we have initiated the Phase 2 clinical trial for this indication. We expect an initial readout of results at the end of this year.

We also announced the arrival of Anne-Marie Duliege as our Chief Medical Officer. In a very short time, Anne-Marie has assumed responsibility for the completion of the fostamatinib Phase 3 studies as well as for the NDA submission. These activities are key to Rigel's future success in launching the commercial product. I've asked Anne-Marie to join us on this call to provide some insights into ITP and autoimmune hemolytic anemia and I -- we will turn the call over to her in a few minutes.

But first, I'd like to ask Ryan Maynard, Rigel's CFO, to report on the financial results from the first quarter.

Thank you, Raul. For the first quarter of 2016, we reported a net loss of $17.5 million or $0.19 per share compared to a net loss of $18.2 million or $0.21 per share in the first quarter of 2015. Revenues of $5 million this quarter were all related to the continued amortization of the upfront payment and FTE fees earned from our deal with Bristol-Myers Squibb. We reported total costs and expenses of $22.6 million in this quarter compared to $20.4 million in the first quarter of last year. The increase in costs this quarter were primarily due to the increase in research and development costs for our Phase 3 ITP and Phase 2 autoimmune hemolytic anemia programs with fostamatinib. As of March 31, 2016, we had cash and investments of $103.6 million, which we expect to be sufficient to fund our operations into the third quarter of 2017.

At this time, I'd like to introduce Anne-Marie Duliege, Rigel's Chief Medical Officer, joining us today remotely.

Thank you, Ryan. I'd like to start out by saying how pleased I am to be part of this great team at such an important transitional time in Rigel's history. As Raul said, we have a lot of work to do and some of it involves making sure that investors, physicians and patients understand fostamatinib's potential.

The physicians treating patients with ITP and autoimmune hemolytic anemia are primary hematologists and hemato-oncologists. These are a small group of specialists. ITP is a rare autoimmune disease, in which the patient's body destroys the platelets at a rapid rate. The platelet count in a normal healthy adult is generally above 150,000 platelets per microliter, but patients with ITP can have platelet counts falling below 30k, putting them at risk for instantaneous or trauma-induced hemorrhage. Patients with chronic ITP have increased mobility as evidenced by their increased bleeding risk and rate of hospitalization. In addition, the disorder's bleeding risk does translate into potentially higher than average mortality rate for adults with chronic ITP.

Rigel's FIT Phase 3 study is evaluating fostamatinib versus placebo in 150 adult patients with chronic ITP across two identical studies. The primary endpoint for both studies is the achievement of a stable platelet count equal or greater than 50,000, over several blood draws performed from midpoint to endpoint of the study. The current standard of care for adults with chronic ITP includes a handful of available treatment. Steroids are typically prescribed as the first line of therapy, potentially followed by intravenous immunoglobulin, rituximab, thrombopoietic agents and splenectomy as deemed necessary.

The challenge for physicians treating patients with chronic ITP is that the therapies don't always work in all patients and that we cannot predict why. Hence, physicians and patients are seeking new alternatives with different mechanisms of actions that are safe, effective and convenient for chronic use.

Fostamatinib mechanism of action, which targets the underlying immune cascade responsible for destroying platelets, offers a novel therapeutic approach with an orally available agent. If the FIT studies demonstrate the efficacy and safety profile of fostamatinib that we anticipate. And if the FDA approves fostamatinib, physicians and patients will have a much-needed new option.

Patients with autoimmune hemolytic anemia are even less well served by current therapies and tend to be quite ill. Under the care of the same group of hematologists and hemato-oncologists as the ITP patients, this group suffers from dangerously low red blood cell count and can be highly anemic.

Our Phase 2 proof-of-concept study is currently recruiting patients. The first cohort of this open label study will evaluate the safety and efficacy of fostamatinib in 17 patients. It will provide useful insight into our plans and designs for future clinical studies. As Raul mentioned, we are working to have results from this cohort readout by the end of this year.

Finally, the last indication currently under clinical investigation in the fostamatinib program is IgA nephropathy. The Phase 2 study is ongoing and recently expanded its reach into Asia. The preliminary results of the first cohort are expected by the end of this year, and I will look forward to sharing more information about our clinical programs with you in the future.

And now I will turn the call back to Raul.

Thank you, Anne-Marie, and it's delightful to have you with us. As you can detect, we are very enthusiastic about the fostamatinib opportunity. One of the questions we frequently receive is, how will the drug fit in the treatment paradigm for ITP? First, we have been conducting extensive market research on ITP, and we have a good understanding of the physician and patient experience with the multiple lines of therapy currently available, only two of which are actually approved for this indication. Physicians and patients are concerned that patients are not achieving acceptable and stable platelet counts in the long term. This, despite efforts to manage their disorder, and thus, there is a need for a new therapeutic that works differently where the other currently available agents may not have.

We view fostamatinib and ITP as a key addition for refractory patients. We know that this molecule has a potent and novel mechanism of action and a very well-defined safety profile. It's entirely reasonable to imagine a scenario in which fostamatinib enters the market, if and when approved by the FDA, and is given to patients who are TPO-experienced, but have been unsuccessful or unsatisfied with those prior therapies. We think this is an attractive position for fostamatinib in this indication.

In regards to autoimmune hemolytic anemia, there is reason to believe -- to expect that fostamatinib could play a significant role in helping patients with this disease. We based our expectations on the following facts. First, there are no currently approved therapies for autoimmune hemolytic anemia. Existing therapies are off label and consist of steroids, IVIg and other agents used to treat ITP. Second, there is very limited pharmaceutical development underway in this disease area, so we know that this is a patient population that is largely underserved. If fostamatinib proves safe and efficacious in this autoimmune hemolytic anemia, this treatment may play a very central role in the treatment of these diseases. Clearly, we're enthusiastic about the synergies that exist between ITP and autoimmune hemolytic anemia, including their shared physician audience. In the upcoming months, we look forward to having a significant -- having significant answers and insights into fostamatinib's potential in both of these indications.

While our priorities and resources are largely focused on advancing fostamatinib towards commercialization, we've also been working on moving our IRAK, Mer, other immune and immuno-oncology projects forward into the clinic. Recently, our researchers have given presentations on these topics at the AACR meeting and will soon be presenting at the immunology conference in Seattle later in May.

One of the topics that will be presented is our work on developing a novel class of Nrf2 activators that may have therapeutic effect in inflammatory and neurodegenerative disorders. We have identified an orally bioavailable lead candidate that which has shown positive results in preclinical studies in a Murine model of multiple sclerosis. In addition, we are actively pursuing collaborations for select projects, including fostamatinib in Europe and in Asia.

As Rigel mentioned earlier, we have a good cash position. We continue to manage our resources wisely and we have enough cash to carry us for 12 months after the Phase 3 studies are reported. This does not take into account any new collaborations or possible financings. In fact, any new deals or collaborations or milestones from our current collaborations would further extend this runway. By the end of the year, we will have pivotal information on fostamatinib's potential in ITP and these two other indications.

In anticipation of the data, Rigel's focus for the remainder of 2016 includes planning and building a commercial organization for the potential launch of fostamatinib in the U.S. And in addition, we will continue to focus on growing the R&D pipeline beyond fostamatinib, while monetizing select pipeline assets through attractive partnerships. It's an exciting time to be part of the Rigel team, and we hope you also agree.

Now let's open the call up for questions.

(Operator Instructions) Our first question comes from Anupam Rama of JPMorgan.

Just a quick one from me. Can you remind us of what your assumptions are around the placebo response for the ITP trials? And what gives you confidence in this? Thanks.

Sure. I could take a shot at that and, Anne-Marie, feel free to chime in as well.

We expect a very low placebo response rate in the Phase 3 studies, and this is -- comes from the experience that Amgen had with its similar trial design for its Nplate product. They did a very similar design looking at multiple readouts in the second half of their study, much as we're doing, and they also saw a very low placebo response rate.

Our next question comes from [Sandy Yang] of Jefferies.

This is Eun. You mentioned that data from two Phase 3 studies will be admitted this year. But based on the completion of patient enrollment, do you expect that data readout to be about two months apart between the two studies?

Eun, thanks for the question, Eun. The first study will happen mid-year, and the second study will be a couple of months after that.

So once the last patient treatment is over, the six months of treatment is over, how soon can you clean up the data and report the top line?

Probably about six weeks, plus or minus two.

Okay. Now are you currently in discussions for ex-U. S. partner?

Ex-U. S. partnerships?

Yes.

We are initiating those discussions now with parties that might be interested. Europe being perhaps the first priority, since we think that, that is most similar to the U.S. I think, we definitely will need the data before we sign any deals, obviously. But right now, in advance of having the data, we want to establish relations, good introductions, to potential parties. So we will be having those meetings very shortly.

Okay. And then question on hemolytic anemia. So you mentioned that we are going to be seeing 17 patient data by end of this year, and then you will start the discussion with the FDA regarding the scope or the protocol for pivotal study. But from talking to KOLs, is it fair to assume that the percentage of patients, the hemoglobin levels going above 10 grams per deciliter would be a good primary endpoint for this study for registration?

We haven't had a discussion with the FDA about that being the pivotal readout in a pivotal study. So it's premature to say that, that's what it will be.

Sure. But how about KOL?

We have had some discussions with KOLs, and it was with their suggestion, concurrence and support that we went ahead and did the design of the Phase 2 study as we had, looking at hemoglobin levels, just trying to get patients with hemoglobin levels above 10. And so clearly, there are KOLs who support that.

Okay. Thank you.

Sure. Thank you for your questions.

(Operator Instructions) I show no further questions in the queue at this time. I will now turn the call over to Mr. Rodriguez.

Thank you. Well, it's been a very exciting quarter, and I think a successful quarter for Rigel. And clearly, very interesting times, and I think a bright future for the rest of the year in terms of getting the data from these various additional studies on fostamatinib. So we continue to appreciate your continued interest and support for Rigel, and we look forward to keeping you up-to-date on our progress. Thank you so much.

Thank you, ladies and gentlemen, for attending today's conference. This concludes the program. You may all disconnect. Good day.