TRACON Pharmaceuticals Inc (TCON) 2023 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to TRACON Pharmaceuticals third quarter 2023 earnings conference call. (Operator Instructions)

女士們、先生們，美好的一天，歡迎參加 TRACON Pharmaceuticals 2023 年第三季財報電話會議。 （操作員說明）

During today's call, we will be making certain forward-looking statements, including statements regarding expected timing of clinical trials and results, regulatory activities, financing opportunities, future expenses, and cash runway into 2024, our development plans and strategy, potential cost savings deliverable through our product development platform or PDP, ability to enter into additional licensing agreements, and expectations regarding the envafolimab treatment continuing to generate a double-digit objective response rates.

在今天的電話會議中，我們將做出某些前瞻性聲明，包括有關臨床試驗的預期時間和結果、監管活動、融資機會、未來費用和2024 年現金跑道、我們的發展計劃和策略、可實現的潛在成本節約的聲明透過我們的產品開發平台或 PDP、簽訂額外許可協議的能力以及對 envafolimab 治療繼續產生兩位數客觀緩解率的期望。

These statements are subject to various risks that are described in our filings made with the Securities and Exchange Commission, including our annual report on Form 10-K for the year ended December 31, 2022, and subsequently, quarterly reports on Form 10-Q.

這些聲明面臨我們向美國證券交易委員會提交的文件中所述的各種風險，包括我們截至 2022 年 12 月 31 日的 10-K 表格年度報告以及隨後的 10-Q 表格季度報告。

You are cautioned not to place undue reliance on these forward-looking statements. And unless required by applicable law, we disclaim any obligation to update such statements.

請您注意不要過度依賴這些前瞻性陳述。除非適用法律要求，否則我們不承擔更新此類聲明的義務。

Now, I'd like to turn the call over to Dr. Charles Theuer, President and CEO of TRACON Pharmaceuticals. Dr. Theuer?

現在，我想將電話轉給 TRACON Pharmaceuticals 總裁兼執行長 Charles Theuer 博士。特伊爾博士？

Good afternoon, and thank you for joining TRACON's third quarter 2023 financial results and business Update Call. I will begin with an update on our pipeline and then review our recent activities. Following that, Scott Brown, our Chief Financial Officer, will discuss our financial results for the three and nine months ended September 30, 2023. Finally, we will conclude by taking your questions.

下午好，感謝您參加 TRACON 2023 年第三季財務業績和業務更新電話會議。我將首先介紹我們的管道的最新情況，然後回顧我們最近的活動。隨後，我們的財務長 Scott Brown 將討論我們截至 2023 年 9 月 30 日的三個月和九個月的財務表現。最後，我們將回答大家的問題。

I'll begin with an update on our continued progress with the ongoing ENVASARC pivotal trial. In September, the data monitoring committee reviewed interim safety and efficacy data from 46 patients in cohort C of single-agent ENVA treatment. The objective response rate in the initial 46 patients treated with single-agent ENVA was 13% by investigator review and 8.7% by blinded independent central review.

我將首先介紹我們正在進行的 ENVASARC 關鍵試驗的最新進展。 9 月，數據監測委員會審查了單藥 ENVA 治療 C 組 46 名患者的中期安全性和有效性數據。根據研究者審查，最初 46 名接受單藥 ENVA 治療的患者的客觀緩解率為 13%，根據盲法獨立中央審查，客觀緩解率為 8.7%。

The response rate assessed by central review, all of which were confirmed responses, more than satisfied the prespecified futility rule and ENVA monotherapy was generally well tolerated.

中央審查評估的緩解率全部為確認緩解，超過了預先設定的無效規則，ENVA 單藥治療通常具有良好的耐受性。

Importantly, median duration of response by central review was greater than 6 months. The DMC recommended the study continue as planned. And since then, more than 20 additional patients have enrolled.

重要的是，中央審查的中位反應持續超過 6 個月。 DMC 建議研究按計劃繼續進行。從那時起，又有 20 多名患者入組。

We are on track to complete accrual of the ENVASARC pivotal trial in the fourth quarter of 2023 and expect to release updated response rate data before the end of the year.

我們預計在 2023 年第四季完成 ENVASARC 關鍵試驗的應計，並預計在年底前發布更新的回應率數據。

As a reminder, in order to statistically exceed the 4% objective response rate of Votrient, the only FDA-approved treatment for patients with refractory UPS or MFS, the primary endpoint in ENVASARC must show objective responses in 9 out of 80 patients or an 11.25% objective response rate confirmed by central review.

提醒一下，為了在統計上超過Votrient（FDA 批准的治療難治性UPS 或MFS 患者的唯一治療方法）4% 的客觀緩解率，ENVASARC 的主要終點必須在80 名患者中的9 名中顯示出客觀緩解率，或11.25經中央審查確認的客觀答覆率%。

Median duration response of greater than 6 months is a key secondary endpoint. Our goal in ENVASARC is to demonstrate that ENVA has the potential to be both safer and more efficacious than Votrient, a drug with a black box warning for fatal liver toxicity.

超過 6 個月的中位反應持續時間是關鍵的次要終點。我們在 ENVASARC 中的目標是證明 ENVA 有可能比 Votrient 更安全、更有效，Votrient 是一種帶有致命肝毒性黑框警告的藥物。

Based on data from trials of other checkpoint inhibitors in refractory UPS or MFS, we are targeting a 15% response rate for single-agent ENVA. Furthermore, we plan to approach the FDA to discuss a BLA filing strategy as soon as we determine nine responses.

根據其他檢查點抑制劑在難治性 UPS 或 MFS 的試驗數據，我們的目標是單藥 ENVA 的緩解率為 15%。此外，我們計劃在確定九項答覆後立即與 FDA 聯繫，討論 BLA 備案策略。

As a reminder, we have received Fast Track designation for ENVA in the sarcoma subtypes of UPS and MFS that have progressed on one or two prior lines of therapy and received orphan drug designation in soft tissue sarcoma based on activity observed in ENVASARC.

提醒一下，我們已獲得ENVA 在UPS 和MFS 肉瘤亞型中的快速通道指定，這些亞型在先前的一到兩個治療方案中取得了進展，並根據ENVASARC 中觀察到的活性獲得了軟組織肉瘤的孤兒藥指定。

These designations provide important advantages that might expedite regulatory review and commercialization of ENVA.

這些指定提供了重要的優勢，可以加快 ENVA 的監管審查和商業化。

ENVASARC is designed to provide safety and efficacy data in the refractory sarcoma subtypes of UPS and MFS. We also have a strategy for the approval of ENVA in frontline sarcoma. Doxorubicin is the most common therapy used for the treatment of newly diagnosed sarcoma patients. We therefore plan to initiate a trial of ENVA and doxorubicin in the frontline setting of the common sarcoma subtypes, including UPS and MFS following the completion of enrollment in the pivotal ENVASARC trial.

ENVASARC 旨在提供 UPS 和 MFS 難治性肉瘤亞型的安全性和有效性資料。我們還有一個批准 ENVA 用於第一線肉瘤治療的策略。阿黴素是治療新診斷的肉瘤患者最常使用的療法。因此，我們計劃在關鍵 ENVASARC 試驗完成入組後，在常見肉瘤亞型（包括 UPS 和 MFS）的第一線環境中啟動 ENVA 和阿黴素的試驗。

The goal of that trial will be to determine the subtypes of sarcoma that best respond to the combination of ENVA and doxorubicin. Assuming positive results in the ENVASARC pivotal trial and potential accelerated approval of ENVA, we expect the FDA will require a randomized trial to demonstrate a survival benefit. We expect this potential Phase 3 post-approval trial will compare single-agent doxorubicin to doxorubicin with ENVA with PFS at the endpoint.

該試驗的目標是確定對 ENVA 和阿黴素聯合治療反應最佳的肉瘤亞型。假設 ENVASARC 關鍵試驗取得積極結果並且 ENVA 可能會加速批准，我們預計 FDA 將要求進行隨機試驗來證明生存獲益。我們預期這項潛在的 3 期核准後試驗將比較單藥阿黴素與阿黴素與 ENVA 的比較，終點為 PFS。

This trial would be expected to enroll patients with UPS and MFS as well as other sarcoma subtypes shown to respond to therapy with ENVA and doxorubicin. We expect to discuss the design of a frontline trial with the FDA at the time or expected pre-BLA meeting to review the expected submission of data from ENVASARC for potential accelerated approval of ENVA in refractory sarcoma.

該試驗預計將招募 UPS 和 MFS 以及其他肉瘤亞型患者，這些患者對 ENVA 和阿黴素治療有反應。我們預計將在當時或預期的 BLA 前會議上與 FDA 討論一線試驗的設計，以審查 ENVASARC 預期提交的數據，以加速批准 ENVA 治療難治性肉瘤。

It is important to understand the sales potential of sarcoma with ENVA at parity pricing is not solely the forecasted $200 million in peak annual ENVA revenues anticipated following approval in refractory UPS and MFS. Our clinical development strategy is designed to create the opportunity for ENVA to broadly benefit patients with sarcoma in the frontline, adjuvant and neoadjuvant settings by seeking supplemental BLAs.

重要的是要了解肉瘤與 ENVA 以平價定價的銷售潛力不僅僅是在難治性 UPS 和 MFS 獲得批准後預計 ENVA 年度收入高峰為 2 億美元。我們的臨床開發策略旨在透過尋求補充 BLA 為 ENVA 創造機會，使第一線、輔助和新輔助環境中的肉瘤患者廣泛受益。

We will now turn to our DNA damage repair inhibitor, TRC102, that is financially supported through a cooperative research and development agreement with the National Cancer Institute. The NCI is sponsoring an ongoing randomized Phase 2 trial assessing TRC102 in stage three non-squamous non-small cell lung cancer in combination with chemo radiation.

我們現在將轉向我們的 DNA 損傷修復抑制劑 TRC102，它透過與國家癌症研究所的合作研發協議獲得財務支持。 NCI 正在贊助一項正在進行的隨機 2 期試驗，評估 TRC102 聯合化療治療第三期非鱗狀非小細胞肺癌的療效。

The two-arm trial will enroll 78 patients to assess the benefit of adding TRC102 to current standard of care treatment of pemetrexed, cisplatin, and radiation therapy followed by consolidated durvalumab maintenance treatment.

這項雙臂試驗將招募 78 名患者，以評估將 TRC102 添加到目前培美曲塞、順鉑和放射治療的標準護理治療中，然後進行綜合 durvalumab 維持治療的益處。

The primary endpoint of the trial is PFS, and the trial is designed to detect an improvement in PFS at one year, from 56% to 75%. Nine sites are open for enrollment in the US and final results are expected in 2025.

該試驗的主要終點是 PFS，該試驗旨在檢測一年後 PFS 的改善，從 56% 提高到 75%。美國有 9 個地點開放報名，預計最終結果將於 2025 年公佈。

I will now shift from our pipeline update to discuss our product development platform of CRO-independent research, which we call our PDP. We continue to expect to execute a license of our PDP to one or more companies this year, with the ideal partner being a company with an emerging pipeline who plans to conduct multiple trials. This offering would include our platform of advanced clinical trial management, data management and safety reporting that we expect would enable our collaborator to potentially conduct trials at a cost of less than one-third of what they may otherwise pay a CRO.

現在我將從管道更新轉向討論我們獨立於 CRO 的研究的產品開發平台，我們稱之為 PDP。我們仍然期望今年向一家或多家公司執行我們的 PDP 許可，理想的合作夥伴是擁有新興管道併計劃進行多項試驗的公司。該產品將包括我們先進的臨床試驗管理、數據管理和安全報告平台，我們預計該平台將使我們的合作者能夠以不到他們向 CRO 支付的費用三分之一的成本進行試驗。

A license of the PDP would be expected to allow a partner to run clinical trials as we do at TRACON for an estimated cost of approximately $100,000 per patient. As the typical CRO charges $300,000 or more per patient, the potential savings from licensing our PDP on a 100-patient trial could be up to approximately $20 million for a partner, in addition to the expected advantages of increased speed of trial execution and pace of enrollment that we enjoy at TRACON by running trials using our in-house team.

預計 PDP 許可證將允許合作夥伴像我們在 TRACON 所做的那樣開展臨床試驗，每位患者的估計成本約為 100,000 美元。由於典型的CRO 對每位患者的收費為30 萬美元或更多，因此，除了提高試驗執行速度和試驗進度的預期優勢外，在100 名患者的試驗中獲得PDP 許可可為合作夥伴節省高達約2,000 萬美元的潛在成本。我們透過使用我們的內部團隊進行試驗來享受 TRACON 的註冊服務。

Turning now to an update on the arbitration work from I-Mab. As you may remember, we collected $22 million from I-Mab in July in satisfaction of the arbitration award, of which $4.4 million were disputed and had been held in a client trust account by our attorneys predicated on discussions as the amount of success-based deferred legal fees the firm was due.

現在談談天境生物仲裁工作的最新情況。您可能還記得，我們​​在7 月從天境生物收取了2200 萬美元來滿足仲裁裁決的要求，其中440 萬美元存在爭議，並由我們的律師根據討論作為基於成功的金額存放在客戶信託帳戶中。公司應繳納的遞延法律費用。

In September, we successfully received $2 million from the client trust in addition to the write-off of approximately $300,000 in invoices from the attorneys. This brings the total amount of net proceeds from the arbitration to $9.1 million, and the matter is now closed.

9 月份，我們成功從客戶信託收到了 200 萬美元，此外還沖銷了律師提供的約 30 萬美元的發票。這使得仲裁淨收益總額達到 910 萬美元，該案現已結束。

At this time, Scott will provide an update on our financials.

此時，斯科特將提供我們財務狀況的最新資訊。

Thank you, Charles, and good afternoon, everyone. Collaboration revenue was $0 million and $9 million for the three and nine months ended September 30, 2023, compared to $0 million for the comparable periods of 2022. The increase in revenue for the nine month period is related to the prespecified $9 million termination fee for the TJ4309 license in conjunction with the previously announced arbitration outcome with I-Mab.

謝謝查爾斯，大家下午好。截至2023 年9 月30 日的三個月和九個月，合作收入分別為000 萬美元和900 萬美元，而2022 年同期為000 萬美元。這九個月的收入增長與預先指定的900 萬美元終止費用有關。TJ4309 許可以及先前宣布的與天境生物的仲裁結果。

TRACON's research and development expenses were $2.3 million and $10.8 million for the three and nine months ended September 30, 2023, compared to $4.1 million and $10 million for the comparable periods of 2022. The decrease in the three-month period was due to enrollment only in cohort C of ENVASARC with the corresponding termination of cohort D of the ENVASARC pivotal trial.

截至2023年9月30日的三個月及九個月，TRACON的研發費用分別為230萬美元及1,080萬美元，而2022年同期的研發費用分別為410萬美元及1,000萬美元。三個月期間的減少僅是由於註冊人數所致ENVASARC 隊列 C 中，ENVASARC 關鍵試驗隊列 D 相應終止。

General and administrative expenses were $1.3 million and $5.5 million for the three and nine months ended September 30, 2023, compared to $2.3 million and $12 million for the comparable periods of 2022. The decrease was due to lower legal expenses.

截至2023 年9 月30 日的三個月和九個月，一般和行政費用分別為130 萬美元和550 萬美元，而2022 年同期為230 萬美元和1,200 萬美元。減少的原因是法律費用減少。

Our net income was $10.8 million for the three months ended September 30, 2023, and our net loss was $4 million for the nine months ended September 30, 2023, compared to net losses of $6.4 million and $22.1 million for the comparable periods of 2022.

截至2023年9月30日的三個月，我們的淨利潤為1,080萬美元，截至2023年9月30日的九個月，我們的淨虧損為400萬美元，而2022年同期的淨虧損分別為640萬美元和2210萬美元。

We recorded other income of $13 million in the three and nine months ended September 30, 2023, due to the arbitration award being collected in the third quarter. Included in the $22 million arbitration award was the $9 million prespecified termination fee payable by I-Mab under the TJ4309 agreement, which we recognized as revenue in Q2 of this year.

由於仲裁裁決在第三季收取，截至 2023 年 9 月 30 日的三個月和九個月，我們錄得其他收入 1,300 萬美元。 2200萬美元的仲裁裁決中包括天境生物根據TJ4309協議應支付的900萬美元的預先指定終止費，我們將其確認為今年第二季度的收入。

Turning to the balance sheet. At September 30, 2023, our cash, cash equivalents and restricted cash totaled $7.8 million compared to $17.5 million at December 31, 2022.

轉向資產負債表。截至 2023 年 9 月 30 日，我們的現金、現金等價物及限制性現金總計 780 萬美元，而 2022 年 12 月 31 日為 1,750 萬美元。

With that, I will turn the call back over to Charles.

這樣，我會將電話轉回查爾斯。

Thank you, Scott. As you have heard, our corporate strategy is proceeding as planned. Allow me to recap two key expected events.

謝謝你，斯科特。正如您所聽到的，我們的企業策略正在按計劃進行。請容許我回顧一下兩個關鍵的預期事件。

First, later this quarter, we expect to report updated response rate data from the ENVASARC pivotal trial.

首先，我們預計將在本季稍後報告 ENVASARC 關鍵試驗的更新回應率數據。

Second, later this quarter, we expect to license our unique product development platform to enable one or more companies to benefit from our capabilities and realize for themselves the substantial clinical trial time and cost savings we enjoy at TRACON while allowing TRACON to generate nondilutive capital.

其次，本季度晚些時候，我們預計將獲得我們獨特的產品開發平台的許可，使一家或多家公司能夠從我們的能力中受益，並為自己實現我們在TRACON 享受的大量臨床試驗時間和成本節省，同時允許TRACON 產生非稀釋資本。

Thank you for your time and attention, and we are now available to answer your questions.

感謝您的時間和關注，我們現在可以回答您的問題。

(Operator Instructions) Ed White, H.C. Wainwright.

（操作員說明）Ed White, H.C.溫賴特。

Hi Charles and Scott. So just on the blinded independent central review that we've seen so far of 8.7%, is it possible for that number to go up based on the investigator review, meaning can some of the investigator review patients be converted to a BICR patient?

嗨查爾斯和斯科特。那麼，就目前我們所看到的 8.7% 的盲法獨立中央審查而言，這個數字是否有可能根據研究者審查而上升，這意味著一些研究者審查的患者可以轉變為 BICR 患者嗎？

So I think, yeah, there are two important datasets, Ed, and thanks for your question, so within the initial 46 patients, that was the basis for the DMC review in September. T

所以我認為，是的，有兩個重要的數據集，Ed，感謝您的提問，所以在最初的 46 名患者中，這是 DMC 在 9 月審查的基礎。時間

o your point, there were 6 responses by investigator review, four of those who were confirmed by central review. It is possible that a patient in that database could subsequently become a response by central review, but I think more importantly is consideration of the next 20-plus patients that enrolled since that time.

o 你的觀點是，調查員審查後有 6 則回复，其中 4 則得到了中央審查的確認。該資料庫中的患者有可能隨後成為中央審查的回應，但我認為更重要的是考慮自那時以來登記的接下來的 20 多名患者。

And that's really, I think, the focal point of the update we expect to provide later this year. And our goal in that case would be to see the response rate by central review with the additional patients to recover to the endpoint of the study, which is a low double-digit response rate.

我認為這確實是我們預計在今年稍後提供的更新的重點。在這種情況下，我們的目標是透過中央審查查看其他患者的緩解率，以恢復到研究終點，即兩位數的低緩解率。

And if you don't hit that low double-digit response rate, would you still proceed to the frontline study? Or would you just not proceed at all the development of the drug?

如果你沒有達到兩位數的低迴應率，你還會繼續進行第一線研究嗎？或者您根本不會繼續進行藥物的開發？

It's a great question. I think the key focal point right now is really focusing on ENVASARC. So our focus right now is completing the enrollment of ENVASARC, assessing the updated response rate data in the patients that have enrolled subsequent to the DMC review that was announced in September.

這是一個很好的問題。我認為現在的重點是 ENVASARC。因此，我們現在的重點是完成 ENVASARC 的註冊，評估 9 月宣布的 DMC 審查後註冊的患者的更新緩解率數據。

And based on that, our expectation is to recover the double-digit response rate. But further development of envafolimab in, for instance, the frontline setting is predicated on achieving that response rate in the current ENVASARC trial.

基於此，我們的期望是恢復兩位數的回應率。但 envafolimab 在第一線環境中的進一步開發取決於目前 ENVASARC 試驗中達到的緩解率。

Okay. Thanks, Charles. And perhaps just a question on the PDP. How should we be thinking about the potential revenue from that? Would there be revenue generated if the license deal was signed this year? Or is it possible that if a deal was signed this year, you wouldn't record revenue until next year?

好的。謝謝，查爾斯。也許只是關於 PDP 的問題。我們該如何考慮由此帶來的潛在收入？如果今年簽署授權協議，會產生收入嗎？或者，如果今年簽署了協議，您是否有可能要到明年才能記錄收入？

Excellent question. So our expectation is to license the platform to one or more companies and to receive revenue in the same time frame. Non-dilutive capital is a basis for licensing the know-how that enables a company to really become a CRO-independent company as we are and see some significant savings.

很好的問題。因此，我們的期望是將平台授權給一家或多家公司，並在同一時間範圍內獲得收入。非稀釋資本是獲得專有技術許可的基礎，使公司能夠像我們一樣真正成為獨立於 CRO 的公司，並看到一些顯著的節省。

So we both expect the license to one or more companies to happen this year, but also we expect the non-dilutive capital that would accompany that license to come in this year as well. So I appreciate the question.

因此，我們預計今年將向一家或多家公司發放許可證，而且我們也預計伴隨該許可證而來的非稀釋資本也將在今年發放。所以我很欣賞這個問題。

Thanks, Charles. And last question, if I may.

謝謝，查爾斯。最後一個問題，如果可以的話。

Yeah.

是的。

With the cash of $7.8 million, what is your cash runway?

擁有 780 萬美元現金，您的現金跑道是什麼？

So our runway right now is into 2024, with the expectation that by consummating a license deal or deals and additional non0dilutive capital will push us further into 2024 based on the deals being consummated.

因此，我們現在的目標是 2024 年，預計透過完成一項或多項授權交易以及額外的非稀釋性資本，我們將在完成交易的基礎上進一步推動我們進入 2024 年。

Okay, great. Thanks for taking my questions.

好的，太好了。感謝您回答我的問題。

Really appreciate the questions. Thank you, Ed. It was a pleasure.

真的很感謝這些問題。謝謝你，艾德。這是一種樂趣。

(Operator Instructions) At this time, I would now like to turn the conference back over to Dr. Theuer for closing remarks.

（操作員指示）此時，我想將會議轉回由 Theuer 博士進行閉幕致詞。

Thank you very much. We appreciate your time and attention, and look forward to speaking with you again next quarter.

非常感謝。我們感謝您的時間和關注，並期待下個季度再次與您交談。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。