Traws Pharma Inc (TRAW) 2021 Q3 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the Onconova Therapeutics' Third Quarter 2021 Financial Results and Business Update Conference Call. (Operator Instructions) As a reminder, this call is being recorded today, 11th of November 2021.

At this time, I would like to turn the call over to Avi Oler, Senior Vice President of Corporate Development and General Counsel.

Thank you. Good afternoon, everyone, and welcome to Onconova's Third Quarter 2021 Financial Results and Business Update Conference Call. Earlier this afternoon, we issued a press release reporting our quarterly financial results and business progress. If you have not yet seen this press release, it is available in the Investors & Media section of our website at www.onconova.com. On today's call, you'll first hear from our President and CEO, Dr. Steve Fruchtman, who will give a high-level overview on our recent progress and future outlook. Our Chief Medical Officer, Dr. Mark Gelder, will then provide a more detailed update on our recent clinical and scientific progress before handing it off to Mark Guerin, our Chief Financial Officer, to review our third quarter financial results. Following these formal remarks, we will then finish the call with a question-and-answer session.

Before passing the call off to Steve, I'd like to remind everyone that statements made by management during this conference call will include forward-looking statements under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties that can cause actual results to differ materially. Forward-looking statements speak only as of the date they are made as the underlying facts and circumstances may change. Except as required by law, Onconova disclaims any obligation to update these forward-looking statements to reflect future information, events or circumstances. For more information on forward-looking statements, please review the disclaimer in today's press release and the risk factors in the company's SEC filings.

With that, it is my pleasure to turn the call over to Steve.

Thank you, Avi. Good afternoon, everyone, and thank you for joining us, and we hope you are all remaining safe amid an ongoing but improving pandemic here in the U.S. Before we begin, we would like to say a very special fact to a group of very special people. On this Veterans Day we say thank you to all who served to keep a safe and risked their own well-being in doing so. Thank you so much.

I am pleased to update you on the progress at Onconova Therapeutics. Since our last earnings call, we have made progress across our pipeline and have achieved key milestones. We also believe our progress during the third quarter has had us on track to achieve additional milestones across our pipeline. In our lead program, evaluate ON 123300, which we recently renamed narazaciclib, we continue to enroll patients in 2 complementary Phase I trials in the U.S. and in China. As a reminder, narazaciclib is a novel, multi-kinase inhibitor, targeting CDK4 and 6 and additional kinases involved in tumorigenesis, including ARK5, which is reported to be involved in cancer cell survival and the mechanisms of how cancer cells metastasize. The 2 Phase I trials are evaluating different administration schemes for narazaciclib, both of which are based on the administration schemes of CDK4/6 inhibitors that are already approved to treat hormone receptor positive, HER2-negative metastatic breast cancer. We plan to use the results of our trials to determine narazaciclib's mechanism of dose and we remain on track to do this in the first half of 2022.

Beyond our lead program, we recently reported encouraging data from the investigator-initiated Phase I/IIa trial evaluating rigosertib in combination with the PD-1 checkpoint inhibitor, nivolumab, in patients with advanced KRAS-mutated non-small cell lung cancer. These results, which Dr. Gelder will discuss in greater detail, support the potential anticancer activity of the rigosertib-nivolumab combination differentiates rigosertib from other RAS pathway modulators that only target a particular KRAS-mutation and suggests that rigosertib may augment the efficacy of checkpoint inhibitors. We believe these findings not only bode well for the continued clinical development of rigosertib in combination with checkpoint inhibition in KRAS-mutated non-small cell lung cancer but may potentially have broad implications across several high unmet indications such as advanced melanoma.

For those of you who are interested in learning more about these data. I strongly encourage you to view the replay of our webinar announcing the data, which featured expert perspectives from the trial's principal investigator, Dr. Raj Veluswamy of the Mount Sinai Medical Center in New York and Dr. Scott Antonia, Professor of Medicine at the Duke Cancer Institute and the Director of its Center for Cancer Immunotherapy. This webinar revenue can be found on the Events & Presentations page of our website.

We also continue to make progress in our investigator-initiated study, evaluating rigosertib in recessive dystrophic epidermolysis bullosa or RDEB, complicated by squamous cell carcinoma of the skin. This is a very rare and tragic condition with a high unmet medical need. RDEB is invariably stable as there are no curative therapies available and immune oncology agents, which are the current standard of care for squamous cell carcinoma have yielded disappointing results. Dr. Gelder will speak more about the disease and ongoing trial in a few moments.

The progress made in our clinical programs during the third quarter, ultimately enabled us to achieve notable milestones, and we then strengthened our balance sheet with $21 million in gross proceeds from an equity financing. We plan to use the proceeds from this financing to support the continued development of our pipeline and to potentially drive its expansion through the in-licensing of an additional complementary product candidate.

With that, I'll now hand the call over to Dr. Gelder to provide you with more detail on our clinical programs and development strategy. Mark?

So thank you, Steve, and thanks once again to all of you who have joined us today. I'll begin today with an update on the status of our lead narazaciclib program. As some of you may know, narazaciclib, formally known as ON 123300, simultaneously inhibits both the cell cycle and cellular metabolism through CDK and ARK5 respectively. This differentiates narazaciclib from currently approved CDK4/6 inhibitors and positions it as a potential treatment for patients that are refractory or have become resistant to these agents. This may be significant as CDK4/6 inhibitors generate more than $6 billion in worldwide sales in 2019 alone.

In-vitro, narazaciclib was shown to inhibit the growth in a number of cancer cell lines, including breast cancer that are resistant to palbociclib, which is the most widely prescribed CDK4/6 inhibitor; narazaciclib also inhibits CDK4 more potently than palbociclib and exhibited improved on-target toxicity in in-vivo preclinical studies, as evidenced by a decrease in neutropenia. We believe that narazaciclib's potent kinase inhibition profile and potentially improved safety profile may ultimately provide strong anticancer activity and facilitate continuous daily dosing in patients. This would provide another important point of differentiation between narazaciclib and the currently approved CDK4/6 inhibitors such as palbociclib and ribociclib. These agents are prescribed in combination with an anti-estrogen in a 3-week on, 1-week off treatment schedule due to issues tolerability, including side effects related to neutropenia or low white blood cell counts. The hope is that narazaciclib's safety and efficacy profile will initially position it as a novel treatment option for CDK4/6 inhibitor refractory patients, while also providing it with an opportunity to move to first-line therapy in the future.

We are evaluating a continuous oral daily dosing schedule in our ongoing Phase I study in the U.S. This multi-sensor trial seeks to enroll patients with advanced cancers, including, but not limited to, hormone receptor positive, HER2-negative metastatic breast cancer who are refractory to or progressing on currently approved CDK4/6 inhibitors. To date, we have completed enrollment in the first cohort with 40 milligrams orally once-a-day and are currently enrolling patients in the second cohort at 80 milligrams orally once a day. In parallel with our U.S. Phase I study, we are also advancing a Phase I study in China in collaboration with our partner, HanX Biopharmaceuticals. This trial is designed to complement our U.S. study by evaluating a 3-week on, 1-week off dosing schedule of oral narazaciclib. To date, the HanX trial has fully enrolled the third dose cohort at 120 milligrams orally once a day. The study is currently enrolling the fourth dose cohort at 160 milligrams orally once a day. No cases of Grade 3 or higher neutropenia or other dose-limiting toxicities have been seen to date in either trial.

Together, we expect findings from the complementary trials in the U.S. and China to inform the recommended Phase II dose and treatment regimen for future trials, including a Phase II basket study that will enroll patients with several different types of cancer. Based on preclinical models, one type of cancer we intend to enroll includes the hormone receptor positive, HER2-negative metastatic breast cancer patients who are resistant to the approved second-generation CDK4/6 inhibitors. We expect to initiate this trial in the second half of next year. Beyond our planned basket study, we also expect the findings from our ongoing Phase I program to inform the design of one or more additional clinical trials that will evaluate the safety and efficacy of narazaciclib in combination with other anticancer agents. These specific plans around these trials are currently under development and will be shared once they have been finalized.

Moving on, I'd now like to discuss our investigator-initiated programs, evaluating rigosertib, our RAS pathway modulator, which continues to make exciting progress. Our last earnings call, we discussed recently published preclinical data that demonstrated the ability of rigosertib to synergize with checkpoint inhibitors by reversing the immunosuppressive tumor microenvironments to the up-regulation of novel antigens such as CD40 on cancer cells. In September, we then reported very encouraging preliminary clinical data suggesting that the observed preclinical synergy between rigosertib and checkpoint inhibition may translate to patients and potentially provide meaningful clinical benefit. These data were from the Phase I/IIa investigator-initiated trial, evaluating rigosertib in combination with the PD-1 checkpoint inhibitor, nivolumab, in patients with advanced KRAS-mutated non-small cell lung cancer. I'll provide a short recap of this encouraging data now, which is topical, given that November is Lung Cancer Awareness month.

Results from the trial's preliminary readout showed that 2 out of 7 evaluable patients achieved a resist-defined partial response with another patient showing stable disease, which gives objective response and disease control rates of 29% and 43%, respectively. In addition, the study doublet of rigosertib and nivolumab was well tolerated and the maximum tolerated dose of the doublet was not reached. Taking a closer look at the study design and data. There are several key points that have generated a high level of enthusiasm from key opinion leaders and which speak to just how encouraging these initial findings are.

The first point is related to the patient population enrolled in the study. These patients were extensively pre-treated with 9 of 12 having failed at least 2 prior lines of therapy and all enrolled patients failed at least 1 line of prior therapy with a PD-1 checkpoint inhibitor. This is significant as PD-1 is the target of nivolumab, which was administered in combination with rigosertib. The fact that we were able to achieve responses in patients who previously failed therapy targeting the PD-1 checkpoint by combining an anti-PD-1 therapy with rigosertib provides encouraging evidence of rigosertib's ability to synergistically combine with checkpoint inhibitors and augment their efficacy in KRAS-mutated cancers. This is important as KRAS mutations are the predominant genetic driver of non-small cell lung cancer, and there is currently a lack of effective treatment options for these patients who failed to adequately respond to checkpoint inhibitor therapy.

A second key finding from the preliminary data readout that I would like to highlight is related to the underlying varied KRAS-mutations of patients achieving a partial response or stable disease, each of which was different. This speaks to rigosertib's mechanisms of action, which is not specific to a particular KRAS variant such as G12C. This provides an important point of differentiation between rigosertib and other RAS pathway modulators, targeting particular KRAS variants such as G12C and potentially positions rigosertib to be more broadly applicable.

Lastly, I should note that the observed radiographic responses were seen in both the lung or the primary tumor site and at multiple metastatic sites, which are the major cause of death for these patients. Collectively, the preliminary data from this Phase I/IIa study, together with the preclinical data we discussed on our last earnings call, suggests that rigosertib may synergize with checkpoint inhibition and that rigosertib checkpoint inhibitor combinations may be applicable not only to KRAS-mutated non-small cell lung cancer but to other indications where PD-1 or PD-L1 inhibitors are the standard care, such as melanoma.

Looking ahead, the Phase I/IIa non-small cell lung cancer trial continues to enroll patients as part of the expansion phase at the highest dose of oral rigosertib as defined in the protocol. We and the principal investigator intend to complete the trial per protocol and anticipate reporting additional data from the study in 2022. In parallel, an additional study that will allow for further dose escalation is also under consideration since the maximum tolerated dose of the rigosertib-nivolumab doublet was not reached in the ongoing trials dose-escalation phase, which has been completed. Based on the data from these 2 trials, we hope to identify the doublet to recommended Phase II dose and better inform its clinical development.

Beyond the investigator-initiated KRAS-mutated non-small cell lung cancer trial, we intend to further leverage the immunotherapeutic effects of rigosertib through a separate investigator-initiated study evaluating rigosertib in combination with a PD-1 checkpoint inhibitor in advanced recurrent malignant melanoma. This trial is supported by both the encouraging preliminary data from the non-small cell lung cancer trial and by the preclinical melanoma studies that were featured in the peer review publication out of Vanderbilt that we discussed on our last call. We and the investigators are currently finalizing the protocol for this trial. It will be submitted to the FDA and expect that it will be initiated in the first half of 2022.

Moving on. I'd like to speak very briefly about the investigator-initiated trial evaluating rigosertib monotherapy in advanced squamous cell carcinoma associated with recessive dystrophic epidermolysis bullosa, or RDEB. As Steve mentioned, this is an ultra-rare condition with an extremely high unmet medical need as it is invariably fatal. It is caused by a loss of expression of the key protein collagen VII, which causes extreme skin fragility and chronic wound formation. Over time, many patients develop squamous cell carcinoma with the over-expression of Polo-Like Kinase 1, or PLK1. The scientific rationale for the ongoing trial of rigosertib in this indication, which was suggested by a leading expert on RDEB comes from the drug screens that identified rigosertib as the most potent inhibitor of Polo-Like Kinase 1, or PLK1 testing. We've seen promising evidence of rigosertib's clinical activity in this indication to date and plan to provide additional updates on the trial's data as it matures as well as at a medical meeting in the upcoming months.

Finally, before handing off the call to Mark Guerin to talk about our financials, I'd like to reemphasize one point. While we are, of course, very interested in the outcomes of the ongoing investigator-initiated studies and plan to continue evaluating opportunities to potentially initiate additional studies in this nature, we remain committed to preserving our primary focus and resources on narazaciclib. We believe this strategy is the best way to ensure the efficient advancement of our lead program while positioning us to generate value through rigosertib's continued development in high unmet need indications.

And with that, I'll turn the call over to Mark Guerin for a discussion of our Q3 financial results. Mark?

Thanks, Mark, and good afternoon, everyone. I'll begin with a quick review of our third quarter expenses, and then I'll discuss our cash position and cash runway.

Research and development expenses for the third quarter of 2021 were $1.8 million, and this compares with $4.2 million for the third quarter of 2020. The decrease was primarily related to higher expenses related to the INSPIRE study in the 2020 period. General and administrative expenses for the third quarter of 2021 were $2.3 million, and this compares with $2.1 million for the third quarter of 2020. The increase was primarily related to expenses for investor relations, proxy solicitation and fees related to our AGMs and special meeting by proxy in 2021.

We reported a net loss for the third quarter of 2021 of $3.5 million or $0.22 per share on 16 million weighted average shares outstanding. This compares with a net loss for the third quarter of 2020 of $6.2 million or $0.52 per share on 12.1 million weighted shares outstanding. Cash and cash equivalents as of September 30, 2021, were $59.4 million versus $19 million as at December 31, 2020.

Our average quarterly operating cash burn in 2021 has been $4.3 million. We believe that our cash position will be sufficient to fund our ongoing clinical trials and business operations through the achievement of significant milestones, including pursuing corporate development opportunities and should be sufficient for more than 2 years.

This completes my financial review. I'll now turn the call back to Steve.

I'd like to thank both Mark's for the thorough review you just heard. In summary, we have multiple key near-term milestones and value drivers ahead of us. In our lead narazaciclib program, we expect our Phase I studies in the United States and China to continue progressing and anticipate selecting a recommended Phase II dose in the first half of next year. This would then be followed by the initiation of our Phase II basket trial, as Dr. Gelder described, including indications such as hormone receptor positive, HER2-negative metastatic breast cancer in the second half of 2022.

In rigosertib investigator-initiated program, we expect to report additional data from the ongoing KRAS-mutated non-small cell lung cancer trial in 2022. We also expect an additional investigator-initiated study evaluating rigosertib in combination with a PD-1 inhibitor in advanced melanoma patients to begin in the first half of the next year.

Finally, we continue to actively evaluate strategic licensing opportunities to enhance our product portfolio. As with all of our decisions, any decision on this front will be driven by excellent science and the potential, the clinical benefit in an indication with an unmet medical need.

So with that review of our clinical progress and our financial results, we'd like to open the call for questions. Operator?

Thank you. (Operator Instructions) And our first question is from Dr. Charles Zhu of Guggenheim Securities.

I had one on narazaciclib. As you look towards potentially identifying a recommended Phase II dose in the first half of next year, how and when are you guys thinking about disclosing these data? And given your potentially differentiated mechanism of action, how would you set expectations about that data?

Thanks, Charles, and I'll ask Dr. Gelder to take that question. Mark?

Yes. So I think that the data will be disclosed initially at a medical meeting of some sorts followed by a publication. But the data will be disclosed at a medical meeting. And in terms of the second question, I think that we are currently considering several different buckets or baskets for the basket trial, i.e., tumor types to evaluate. And we're continuing to refine that list over time based on the kinase inhibition profile that we have with narazaciclib and will also be influenced to some degree by hints of activity or different signals that we see during the course of the Phase I study. And then, we will, as that information gets further distilled and it becomes more set in stone, so to speak, then we will make that public. But Steve, I don't know if you want to comment further.

No. I think as usual Mark was comprehensive. Of course, we're looking for signals in the Phase I efficacy trial. And once we create the bucket trial, which will probably be mono-narazaciclib, but we also will be looking at the potential for combinations of narazaciclib, be that with an anti-estrogen, be that with an immuno-oncology drug, we will be considering those approaches as well.

And our next question is from Joe Pantginis of H.C. Wainwright.

This is [Matt] on for Joe. So just quickly, we are wondering if and maybe what kind of in-licensing you guys might be looking at? And if any of that could be complementary to some of the current assets you guys that are making some pretty great progress in your pipeline?

Avi, would you like to answer [Matt's] question, please?

Sure. Sure. Thanks for the question, [Matt]. And we're quite excited about our existing programs of narazaciclib and rigosertib. Dr. Gelder and Dr. Fruchtman between them and how they have been a part of over a dozen oncology drug approvals. We're excited about our existing programs. So when we look about adding the complementary program, as Dr. Fruchtman stated in his remarks, we're looking at what fits best in the portfolio as another shot on goal for a quarter there expanding the pipeline and look forward to updating our progress on that in the future.

And our next question is from Dr. Robert LeBoyer of NOBLE Capital.

Thank you for the great comprehensive summary of the products. In Dr. Gelder's summary of narazaciclib, there were some points about the comparison with palbociclib. Could you just clarify the differentiating factors and the different targets that you had discussed just briefly?

I'll ask Dr. Gelder to take that and also Dr. Cosenza after Mark's comments may want to add to that how narazaciclib compare to the CDK4/6 agents.

Yes. So if we look at narazaciclib, and we then look at palbociclib, and we look at the in-vitro kinase inhibition profiles. In terms of the inhibition of CDK4, ON 123 or narazaciclib is actually a little more potent than is palbo. If we look at CDK6, narazaciclib is less potent than is palbo. And this may be the underlying cause or may be responsible for the decrease in neutropenia that we have seen pre-clinically in the mouse model when we compare narazaciclib or ON 123 and palbo. We'll have to see how this plays out in the Phase I study, the dose-escalation study, we'll have to look carefully at the AE profile or safety profile, et cetera. There are several other kinases that ON 123 or narazaciclib hits that either a palbociclib doesn't hit at all or it hits much more weakly or less potently based on the in-vitro kinase profiles, and these include things like ARK5, FLT3, CD DFR, et cetera, et cetera. So there are, when you look at them side by side, there are several kinases that we have activity against the palbo just does not. So I'm not sure if this has answered your question or not. If not, I'm happy to try and expand a little bit further or Steve may want to expand further as well.

Well, actually, perhaps Steve Cosenza would like to add something based on our preclinical studies to date. Steve, do you have anything to add to more comments?

Sure. Thank you. That's a great question, Robert. The differentiating point based on in vitro data, as Dr. Gelder had spoke to previously is that of all the CDK4/6 inhibitor, ribociclib is the most specific, palbociclib is following the most specific. And then you have abemaciclib and narazaciclib, which are both -- would be considered multi-kinase inhibitors. And on side-by-side testing, there are differences among those 2, especially about palbociclib. And we believe that the differentiating points can be found in those targets, both for efficacy and for toxicity profiles.

In the published data that we have, you can see that cell lines treated with palbociclib versus 123 or narazaciclib is that we induce apoptosis. We inhibit the AKT and mTOR pathways, which are important for tumor cell survival. And these are not done in palbociclib. So we induce a more set of toxic type of treating tumor cells whereas palbo and ribo and abe induce more of a sort of static; abemaciclib also induces a fantastic effect in certain tumor cell lines, much like 123 or narazaciclib. And again, we believe these are based on targets. However, amongst the 4 CDK4/6 inhibitors, we are the only one that induces and inhibits, not induce but inhibits ARK5. And ARK5 is a very interesting target. There are no known approved inhibitor for ARK5. However, this is a very important target for tumor cell survival, not so much proliferation of tumor cells, but survival of tumor cells in hypoxic conditions. So we believe this will be very beneficial as part of our mechanism of action.

Okay. Great. You actually did answer the question. I was really interested in how narazaciclib compares in terms of the targets, the potency and the breadth of targets with the approved drugs. So thank you very much.

Thank you. And I am showing no further questions in the queue. At this time, I'd like to turn the call back to the speakers for any closing remarks.

Thank you, Laurie, and to all our participants today, and thank you for participating in today's update call. We look forward to executing on our business plan and to keep you appraised of all of our progress. We appreciate your continued interest in our programs and your insightful questions. Thanks again, and have a lovely evening, and we hope to interact with all of you again soon. Take care.

And ladies and gentlemen, thank you for your participation on today's conference call. This concludes today's event, and you may now disconnect.