Syros Pharmaceuticals Inc (SYRS) 2021 Q1 法說會逐字稿

Good morning, and welcome to Syros Pharmaceuticals First Quarter 2021 Financial Results Conference Call. (Operator Instructions) Please be advised that today's call is being recorded.

At this time, I would like to turn the call over to Naomi Aoki, Vice President of Corporate Communications and Investor Relations at Syros.

Thank you. This morning, we issued a press release with our first quarter 2021 financial results, along with anticipated future milestones and recent accomplishments. This release is available on the Investors and Media section of Syros' website at www.syros.com. We will begin the call with prepared remarks by Dr. Nancy Simonian, our Chief Executive Officer; and Joe Ferra, our Chief Financial Officer. We'll then open the call for questions. Dr. David Roth, our Chief Medical Officer; and Dr. Eric Olson, our Chief Scientific Officer, are also on the call and will be available for Q&A.

Before we begin, I would like to remind everyone that statements we make on this conference call will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our annual report on Form 10-K, our quarterly report on Form 10-Q that we filed this morning and any other filings that we may make with the SEC in the future.

In particular, the extent to which the COVID-19 outbreak continues to impact our operations, and those of third parties on which we rely, will depend on future developments which are highly uncertain and cannot be predicted with confidence. Any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements.

I would now like to turn the call over to Nancy.

Thank you, Naomi, and good morning, everyone. Thank you for joining us today to review our first quarter 2021 progress and recent business highlights.

At Syros, we believe that people with cancers and monogenic diseases deserve better. At the heart of everything we do is our dedication to deliver new medicines that provide a profound benefit for patients with these difficult-to-treat diseases. With that mission front and center, we are advancing a differentiated portfolio of product candidates, each with the potential to set a new standard of care. We remain laser focused on executing against the strategy we laid out last year with the aim of rapidly maturing Syros into a commercial stage company. That strategy is rooted in 3 priorities: advancing a leading portfolio of targeted therapies for hematologic disorders; building on our leadership in selective CDK inhibition for difficult-to-treat cancers; and leveraging our foundational gene control discovery engine to fuel a robust and sustainable pipeline to support our long-term growth.

Let me begin with our targeted hematology portfolio. We have 2 clinical stage programs, SY-1425 and SY-2101 for targeted patient populations in higher risk myelodysplastic syndrome, acute myeloid leukemia and acute promyelocytic leukemia. Together, these programs position us for 2 potential new drug application filings in higher-risk MDS and APL in 2024 with additional opportunities beyond that time frame.

We recently began dosing patients in our Phase III clinical trial of 1425 in combination with azacitidine in RARA-positive patients with newly diagnosed higher-risk MDS. The trial will compare the complete response rate of 1425 and azacitidine to placebo and azacitidine. If successful, the trial could enable an NDA filing in 2024. The trial marks a tremendous milestone for Syros as our first registration-enabling study and for patients with MDS who remain woefully underserved despite advances in hematologic malignancies more broadly.

Hypomethylating agents, or HMAs, which are the existing standard of care for MDS, provide limited efficacy and many patients continuing to suffer mortality and morbidity from disease-related cytopenias. Aside from HMAs, no new therapies for MDS have been approved in over a decade. There is a clear need for new options that can deliver benefit to the thousands of people living with MDS and improving their quality of life. We believe that the combination of 1425 and azacitidine is ideally suited to address this need.

In clinical studies, 1425 has shown single agent activity in relapsed or refractory higher-risk MDS. And in combination with azacitidine, 1425 led to a 67% composite complete response rate in RARA-positive patients with low blast count AML, which is close to higher-risk MDS on the disease continuum. Importantly, the combination of 1425 and azacitidine has been well tolerated with no evidence of increased toxicity relative to either as a single agent. Importantly, there was no increase in neutropenia or anemia, which is so important in treatments for patients with MDS. Taken together, these data suggest that the combination is highly differentiated. 1425 is an oral agent that in combination with azacitidine has the potential to deliver high rates of complete remission without introducing additive cytopenias for a targeted subset of higher-risk MDS patients.

Turning to our efforts in AML, we remain on track to initiate a randomized Phase II trial evaluating the triplet regimen of 1425 plus venetoclax and azacitidine in the second half of this year. This trial will compare the composite complete response rate of the triplet of 1425 ven/aza to ven/aza alone. Despite the emergence of ven/aza as the standard of care in newly diagnosed AML, 1/3 of patients remain refractory to frontline therapy, and recent studies suggest that these patients are enriched for a monocytic form of the disease. Our data show that most RARA-positive patients, including those who have achieved complete responses with 1425, have this monocytic form of AML.

AML is a heterogeneous disease, and we believe many patients will present upfront with both monocytic and non-monocytic leukemia cells. By employing a triplet strategy that combines 1425 with ven/aza, we simultaneously target both monocytic and non-monocytic leukemia cells from the outset, potentially benefiting patients who are refractory to ven/aza while reducing the emergence of resistant disease. We look forward to initiating the trial later this year and reporting initial data in 2022.

Turning to the second program in our hematology portfolio, 2101 is a novel oral form of arsenic trioxide in development for the treatment of APL, which is a genetically defined form of AML. We believe 2101 could significantly impact the lives of people with APL. IV ATO, the current standard of care, offers a cure rate of over 80%, but it comes with an enormously heavy treatment burden. As an oral therapy, we believe that 2101 could dramatically reduce this treatment burden without sacrificing efficacy. We plan to initiate a dose confirmation study in the second half of this year, followed by a Phase III study in 2022. If successful, this study could enable an NDA filing in 2024.

Before moving to our broader portfolio, I want to take a moment to highlight the targeted hematology KOL event series that we announced this morning. Over the course of the next several months, we will be hosting 3 webcast conference calls focused on our hematology programs. In May, Dr. Amy DeZern of Johns Hopkins will join us to speak about higher-risk MDS. In June, Dr. Daniel Pollyea of the University of Colorado School of Medicine will present on unfit AML. And in July, Dr. Farhad Ravandi of the MD Anderson Cancer Center will speak about APL. We are very much looking forward to these webinars and hope you will join us to learn more about the unmet needs in MDS, AML and APL as well as the opportunities for 1425 and 2101 to set new standards of care for people with these diseases. Additional details on each call will be announced shortly.

Turning to our focus on CDK7 inhibition. We continue to enroll patients in our Phase I dose escalation study of SY-5609, and we remain on track to announce updated dose escalation data, including clinical activity data in the third quarter. As a reminder, the dose escalation is enrolling patients with advanced breast, colorectal, lung, ovarian or pancreatic cancer or with solid tumors of any histology that harbor RB pathway alterations. We are exploring various dosing regimens of 5609 as both a single and combination agent, and we expect to move into the expansion phase of the Phase I trial in the second half of 2021.

In parallel, we continue to invest in our gene control discovery engine with the goal of fully exploiting the power of our platform to advance additional programs in cancer and monogenic diseases, and we remain on track to name our next development candidate in 2022.

As we've shared before, our most advanced preclinical program targets CDK12, another member of the transcriptional CDK family. Preclinical studies show a synthetic lethal relationship between PARP and CDK12, which are both involved in DNA damage repair, opening up several opportunities for combining a CDK12 inhibitor with PARP inhibitors as well as other drugs that cause DNA damage or inhibit its repair.

In addition to our work on sickle cell disease with Global Blood Therapeutics, we are also making good progress with our second monogenic disease program in myotonic dystrophy type 1, or DM1. Our goal here is to develop a trinucleotide repeat modulator to decrease the expression of the toxic copy of the DMPK gene. As we continue to advance this program, we are gleaning key insights that could apply to other nucleotide repeat disorders. This has the potential to unlock massive opportunity. More than 40 genetic disorders are caused by nucleotide repeat expansion, a kind of mutation in which simple DNA sequences repeat an increasing copy number and induce disease like DM1, Huntington's disease or Fragile X syndrome.

All in, I believe we are in an incredibly strong position as we thoughtfully and strategically advance an industry-leading pipeline across key areas of unmet need in cancer and monogenic disease. Since our founding, we have remained laser focused on building a synergistic portfolio where insights gleaned in one program can be applied to advance our next wave of efforts, and where we can capitalize on our expertise as well as our clinical and commercial investments to advance multiple programs forward in parallel. We are entering a catalyst-rich period for Syros and look forward to updating you further as we continue to move through clinical development.

With that, let me turn the call over to Joe to review our first quarter 2021 financial results.

Thank you, Nancy. We continue to operate from a position of financial strength. We ended the first quarter with $222 million in cash, cash equivalents and marketable securities compared to $174.0 million as of December 31, 2020. This increase reflects gross proceeds of $75.6 million from our public offering, which closed in January 2021, partially offset by cash used to fund our operations in the first quarter. Based on our current plans, we believe our cash position is sufficient to fund our business into 2023, enabling aggressive investment in each of our 3 strategic areas of focus.

We recognized revenue of $4.8 million in the first quarter compared to $2.4 million in the first quarter of 2020. This $4.8 million consisted of $4.0 million under our collaboration with Global Blood Therapeutics and $0.8 million under our collaboration with Incyte. In the first quarter of 2020, we recognized $2.2 million from our collaboration with GBT and $0.2 million from our collaboration with Incyte.

R&D expenses were $20.0 million in the first quarter of 2021 compared to $14.6 million for the same period in 2020. This increase was primarily due to the continued advancement of our clinical programs, including the addition of SY-2101 and an increase in employee-related expenses.

G&A expenses were $5.7 million in the first quarter of 2021 compared to $5.1 million for the same period in 2020. This increase was primarily due to an increase in employee-related expenses.

Finally, we reported net loss for the first quarter of $14.2 million, or $0.23 per share, compared to a net loss of $17.2 million, or $0.39 per share, for the same period in 2020.

With that, I will turn the call over to the operator for questions. Thank you all very much.

(Operator Instructions) Our first question comes from the line of Phil Nadeau with Cowen and Company.

Congrats on the progress. A few questions from us. First on the Phase III in HR MDS, what's the most recent count for sites that are enrolling patients today? And have you experienced any COVID-related issues in getting sites open and recruiting?

Thanks, Phil. David, do you want to take that?

Sure. So as you know, we've recently initiated the trial and we're actively dosing patients. We haven't specifically guided to the specific number of sites or patients at this time. But I do want to remind you that as we move forward, if all works out with a successful outcome, we are anticipating the potential to file an NDA in the 2024 time frame. As it relates to COVID, we're managing through COVID. I think that there are no specific challenges that we've confronted that we don't feel can be mitigated, and we remain on track moving forward right now.

Great. Then second, on 5609, could you give us some sense of how many patients will be in that Q3 update, maybe what the duration of follow-up is likely to be and also some sense of the efficacy measures that you'll be able to disclose at that time?

So for 5609, we are planning for a data update in the third quarter of this year. And that update will include more information around the safety and tolerability, the PK and PD that we've reported on previously, and we're also going to have a focus on the clinical activity. We haven't specifically guided to the numbers of patients that would be included in that presentation, but I think you can anticipate we'll report the available data we have to us at the time of the presentation.

Great. And then last question. For that update, is there a specific form? Is that likely to be in conjunction with a medical meeting, or will it likely be a Syros event itself?

So our general practice has been to report data from trials at medical meetings. So that's been sort of our standard practice. Obviously last year with COVID, there were big questions on would that generally change. But I think we -- that's the general approach we've been taking.

Our next question comes from the line of Jason Butler with JMP Securities.

I just had 2. You've had the -- for several months now. Just wondering if you've had the opportunity for any dialogue with regulators or with KOLs to confirm your development plans and the approval path.

Jason, sorry, you cut out a little bit. For which program? I missed it. You cut out.

For 2101.

For 2101. Okay. I think -- we certainly have had and I think we've shared with you discussions with many KOLs. I think that I would just say there is a huge amount of interest and enthusiasm I think which really speaks to the big need for an oral therapy in APL, just given how burdensome the IV is. So we've had a lot of input. And as you know, we're going to have one of those KOLs speak at an upcoming event, I believe it's in July, from MD Anderson, Ravandi, Dr. Ravandi. He -- but there's a lot of interest and enthusiasm. In terms of regulatory updates and discussions, I think we've shared with you that when we acquired the asset Orsenix, had had discussions with the agency and sort of developed a plan that we're kind of -- is on our current operating assumptions on that. So clearly, as we move forward and we have any further updates, we'll certainly apprise you of those.

Okay. Great. And then second question on 1425. In the triple combo with ven/aza, are you screening for patients with monocytic cells or stratifying on that basis? And then just thinking forward to how that could change the standard of care, are patients typically screened for monocytic cells today, or would you not envisage that to be necessary? You wouldn't need to do that in clinical practice?

Yes. No, good question. So we are focused on RARA-positive newly diagnosed unfit AML for that study. And so we are not specifically looking for patients who have monocytic features. We're screening for RARA. What we showed at the ASH meeting was that the majority of the patients who were RARA-positive were indeed those monocytic type patients. But we don't foresee a need to further screen for those additional features since the vast majority of the RARA-positive patients are indeed those patients. So that simplifies things for us greatly, which is really nice. And we really do anticipate that this could significantly address a newly created unmet need, because about 1/3 of patients don't respond to the ven/aza combo, and the majority of which are considered these types of patients. As far as the patient analyses when they come in, they're classified that way more traditionally just based on the appearances of the cells or certain cell surface markers or genetic expression levels. Sometimes these are done as part of the routine workup. They're not consistently done. Certainly in the research setting that's been done and has helped us make this connection.

(Operator Instructions) Our next question comes from the line of Mark Breidenbach with Oppenheimer.

I'm just wondering if you can offer any early observations from the patient screening success rate in the Phase III MDS trial. I guess I'm just wondering if you see any potential challenges in finding RARA-positive MDS patients who also qualify for high-risk classification by IPSS criteria?

Sure. And we have analyzed our screening of well over 350 patients sometime back -- and the data continues to trend consistently over time in patients with AML or higher-risk MDS who've been previously eligible for our studies. And we see a 30% rate of RARA positivity. So 30% of patients have this. And we foresee no specific challenges or obstacles to identifying 30% of patients who are higher-risk MDS. Those patients are out there, and they're very excited about the opportunity to participate in a trial that offers an oral medicine, which is really convenient, because keep in mind, these higher-risk MDS patients are typically still managed in the outpatient setting. And when you are enrolling in studies that require you get an IV drug, it's sort of -- it's an extra burden. So I think that's very appealing. And having a targeted agent in that kind of disease space is also very exciting, in particular, given the data that we've shown where we have such a high response rate in AML and as high or even higher in the lower blast count AML, which is more closely aligned with the high-risk diagnosis. So I think our data sets, the nature of our drug and the tolerability profile all support enthusiasm for the investigators to direct patients into our study.

Our next question comes from the line of Zegbeh Jallah with ROTH Capital Partners.

Congrats on the progress. Just had a real quick question here just about any additional efforts to kind of educate clinicians on the RARA biomarker, especially since you're seeing that it particularly could be predictive of patients that may not respond to venetoclax. And then any additional progress on your companion diagnostic?

I'm going to have David answer that.

Sure. So I would say that it's really important that there continues to be increasing awareness of our study. And I think the availability now of the data that we shared at ASH, coupled with the outreach that we've done to initiate a global study, has really helped us a great deal in communicating our data, our results and our hopefulness for this drug in helping patients in the future. And so I think we've already made some really good progress in explaining that. And I can say the data that we shared, that poster on the correlation of our biomarker with a resistance phenotype to venetoclax has really caught people's attention, because the physicians are really looking for why doesn't that work and how can we still address those patients? We don't typically select for them, but now there may be other options. So the idea that one could select for RARA positivity and channel those patients to our drug has really captured their imagination. And I think we're seeing that in the interest in participating in our study. So we're working really hard to get that word out, and we think that the data are helping us do our job.

Yes, I would just add, Zegbeh, as you know, we're -- we have these 2 KOL events. The first one is this month on higher-risk MDS with Amy DeZern and then in June in AML. So I think that will be a great opportunity for you to hear directly from the KOLs in terms of how they think about this.

Okay. And there was one other question you had about the companion diagnostic. And I know that we've shared with you that we had enrolled the RARA-negative patients early on in that study just to make that observation that there was indeed a selection advantage. The biomarker itself is operating as we had anticipated, and it's enriching for patients who are likely to respond. And we're making great progress toward the development of a commercial companion diagnostics such that it's available coordinately with the approval and launch of the drug.

Congrats on the progress. I'm looking forward to the KOL events.

Our next question comes from the line of Ted Tenthoff with Piper Sandler.

I wanted to ask a little bit about sort of the discovery efforts. And appreciating that you guys are kind of moving down the chain a little bit here and development has become such a bigger part of the company. But I still want to understand, I feel like there's so much still to do with this platform. So maybe can you give us some updates on what's going on, on the discovery side and even future potential partnerships?

So Ted, thanks for that. And we couldn't agree more. I think -- I'm going to have Eric address your question, but we have made just tremendous progress and insights with our gene control platform. And interesting to see so many other companies cropping up today in exactly that same space. But we've been doing this for 7, 8 years, and I think are just -- have gleaned so many great insights in terms of how to develop important new drugs. So Eric, let me turn the meat of the question over to you.

Sure. Thanks, Ted, for the question. Obviously, I'll just kind of take it in a couple of parts. First is our early pipeline itself. And as Nancy said in her remarks, CDK12 is looking like a really, really interesting target. We think there's a great opportunity to be combining a molecule like that with other DNA damage or DDR agents such as PARP inhibitors. And our collaboration with Global Blood Therapeutics has really, really allowed us to kind of accelerate our drug discovery capabilities in this platform space of how do you turn up or how do you turn down a gene. As you know, that program is designed to multiple approaches to find small molecules that will turn up the expression of fetal globin. And then kind of a third area is the whole field of kind of transcription and gene regulation as it impacts diseases across several different therapeutic areas is really exploding. This, what we said early at the company, this 98% of the genome that doesn't code for genes. There's just been an explosion of information over the last few years on what that other genome is doing and more specifically how it's linked to specific diseases. And we're actively looking at all of that data and thinking about brand new programs. So it's a very rich and exciting time to be in kind of the gene control space. So a lot of future, but also executing on the programs that are right in front of us.

There are no further questions. I will now turn the call back to Nancy Simonian for closing remarks.

Thank you, operator, and thank you, everyone, for joining us this morning. We are grateful for your continued support as we execute against our 3 strategic priorities and look forward to updating you further as we pursue our ultimate goal of maturing Syros into a fully integrated biopharmaceutical company and delivering a portfolio of targeted small molecule medicines that profoundly impact the lives of patients.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.