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Edited Transcript of CRIS earnings conference call or presentation 5-Nov-19 1:30pm GMT

Q3 2019 Curis Inc Earnings Call

LEXINGTON Nov 21, 2019 (Thomson StreetEvents) -- Edited Transcript of Curis Inc earnings conference call or presentation Tuesday, November 5, 2019 at 1:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* James E. Dentzer

Curis, Inc. - President, CEO, Secretary & Director

* Robert E. Martell

Curis, Inc. - Head of Research & Development

* William Steinkrauss

Curis, Inc. - CFO

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Presentation

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Operator [1]

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Good afternoon. And welcome to the Curis' Third Quarter Earnings Call. (Operator Instructions) Please note this event is being recorded.

I would now like to turn the conference over to the company's Chief Financial Officer, Bill Steinkrauss. Please go ahead.

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William Steinkrauss, Curis, Inc. - CFO [2]

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Thank you, and welcome to Curis' Third Quarter 2019 Earnings Call. Before we begin, I would encourage everyone to go to the Investors section of our website at www.curis.com to find our third quarter 2019 earnings release and related financial tables.

I would also like to remind everyone that during the call, management will be making forward-looking statements, which are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and actual results may differ materially.

For additional details, please see our SEC filings.

Joining me on today's call are Jim Dentzer, President and Chief Executive Officer; and Bob Martell, Head of R&D. We will also be available for Q&A at the end of the call.

I'd now like to turn the call over Curis' CEO, Jim Dentzer.

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James E. Dentzer, Curis, Inc. - President, CEO, Secretary & Director [3]

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Thank you, Bill. Good morning, everyone. And thank you for joining us today for our third quarter 2019 earnings call and business update. Our mission at Curis is to develop the next generation of targeted cancer drugs to help patients live longer, healthier lives. This involves leveraging our translational biology, precision medicine and clinical development expertise to select the right targets, design the right drugs and then study the right patients.

This quarter, we've made significant progress across our clinical programs for our novel first-in-class cancer therapeutics with our fimepinostat and CA-4948 studies enrolling well and on track for data readouts before the end of the year.

And so I'd like to begin this call by reviewing the data we announced earlier today from our CA-170 program in mesothelioma. As a reminder, CA-170 is the first oral small molecule targeting VISTA and PDL1 and the only candidate of its kind in the clinic.

Earlier today, we announced initial efficacy data from our Phase I study of CA-170 in mesothelioma patients with high VISTA expression in conjunction with the Society for Immunotherapy of Cancer 2019 Annual Meeting in National Harbor, Maryland.

A quick reminder about the study design. Our Phase I study was designed to evaluate the safety, recommended Phase II dose and maximum tolerated dose of CA-170. Secondary endpoints of this trial were pharmacokinetic or PK and anticancer activity. Exploratory endpoints included biomarkers and pharmacodynamic, or PD, effects. The study enrolled 12 patients with mesothelioma across 6 study sites within the U.S. and U.K., randomizing patients into 2 cohorts. The high-dose cohort received 1,200 milligrams twice daily of CA-170, while the low-dose cohort received 200 milligrams twice daily of CA-170. Patients who did not respond or experienced disease progression at the 200-milligram twice-daily dose were then crossed over to the high-dose cohort.

Now to the data. Of the 12 patients enrolled, 11 patients have discontinued treatment with no partial or complete responses observed per Response Evaluation Criteria in Solid Tumors or RECIST.

11 patients were on treatment for at least one post-baseline disease assessment. And of the 11 evaluable patients, 7 had a best response of stable disease. This includes 2 of 3 patients at the 200-milligram twice-daily dose with a mean duration of 64 days and 5 of 8 patients assigned to or escalated to the 1,200-milligram twice-daily dose with a mean duration of 115 days.

While in this population, stable disease for an extended period is certainly better than quick progression. We do not feel these data warrant additional study of CA-170 as a monotherapy therapeutic in mesothelioma.

It is our strategic imperative to focus our team and our capital on our clinical development programs, where we believe our candidates have the greatest potential to serve as novel effective therapies for patients with cancer.

Although we did not observe single-agent efficacy in this mesothelioma trial, we believe that CA-170, particularly as a PDL1 antagonist, may be effective in other cancer situations. We also continue to believe that VISTA is an important and scientifically validated target with significant potential as a therapeutic approach for difficult-to-treat cancers.

So we will take a deep look at the patient data from Phase I and from the Phase II study conducted by our partner, Aurigene, to evaluate the potential of CA-170 in other indications.

We have also gained valuable insights from this study on VISTA as a target, which will help us to determine how we may better address VISTA in the future. We will provide guidance on next steps for CA-170 and our work on VISTA once we have them, and we look forward to updating you.

Now I'd like to give a brief overview of our 2 other clinical candidates, and then I'll turn the call over to Bob for more detail.

As many of you know, we're currently evaluating CA-4948 in patients with relapsed/refractory diffuse large B-cell lymphoma, or DLBCL, and Waldenström's macroglobulinemia in an ongoing Phase I dose escalation study. We announced encouraging initial data earlier this year and are on track to report updated safety and efficacy data from this study before year-end. And as we announced last quarter, we're planning to initiate a separate Phase I trial of CA-4948 in patients with acute myeloid leukemia and myelodysplastic syndrome.

We are also advancing our ongoing Phase I study of fimepinostat, a mix suppressor in combination with venetoclax, a BCL-2 suppressor, for patients with DLBCL. We remain on track to report initial safety data from this study in the fourth quarter of 2019.

And with that, I'll turn the call over to Bob.

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Robert E. Martell, Curis, Inc. - Head of Research & Development [4]

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Thank you, Jim. Hello, everyone, and thanks for coming and joining us this morning. I'll start with fimepinostat, our anti-MYC program, which targets both the genetic transcription and protein degradation of MYC. Fimepinostat uniquely targets MYC through simultaneous inhibition of both PI3 kinase and HDAC, 2 enzymes that are essential to manifest MYC derangement in cancer.

As you may know, MYC levels are enhanced in many malignancies through a variety of mechanisms. We and others have shown synergy in targeting both HDAC and PI3 kinase simultaneously, but we have the advantage in fimepinostat of targeting both enzymes within the same molecule, and we have shown clinically that both enzymes are inhibited.

In clinical studies to date in patients with MYC-altered DLBCL, fimepinostat has shown a 23% overall response rate and a median duration of response of 13.6 months as a single agent, many patients received clear benefit even in the Double-Hit population of DLBCL, a patient group with the most challenging prognosis.

We decided to combine fimepinostat with venetoclax, an anti-lymphoma agent in our Phase I study for 2 main reasons: first, since the strong benefit of fimepinostat is somewhat delayed due to its mechanism of action, adding an anti-lymphoma agent allows us to create a bridge for patients with rapidly growing lymphomas, slowing this growth long enough to allow fimepinostat's benefit to take hold.

Second, Double-Hit lymphoma, one of the deadliest types of lymphoma, is defined by alterations in both MYC and BCL-2. Since venetoclax is a rapidly acting drug that targets BCL-2, its combination with our mix suppressor fimepinostat is, we believe, an ideal combination to target this type of lymphoma. This has been supported in preclinical models of Double-Hit lymphoma, where we've observed dramatic synergy with this combination.

Our Phase I study is designed to evaluate the safety and tolerability, the pharmacokinetics and the pharmacodynamics and the anticancer activity of the fimepinostat and venetoclax combination in patients with relapsed or refractory DLBCL, including those with Double-Hit lymphoma.

We are enrolling patients in 2 cohorts in this study. In the first cohort, patients receive 30 milligrams of fimepinostat and 400 milligrams of venetoclax daily. These are doses that have already demonstrated clinical activity as single agents.

In the second cohort, patients will receive full doses of each agent, 60 milligrams of fimepinostat and 400 milligrams of venetoclax daily.

We plan to continue dose escalation until the recommended Phase II dose has been identified, and we expect to report initial data from the study later this year.

Moving on to CA-4948. CA-4948 is a first-in-class orally available small molecule inhibitor of IRAK4, a critical component of the myddosome in the TLR pathway, which leads downstream to B-cell proliferation. Oncogenic IRAK4-L is also produced as a result of spliceosome mutations found in many cases of AML and MDS. Dysregulation of this pathway is known to cause cancer, yet there are currently no approved therapies targeting this pathway.

With CA-4948, we have a potential therapeutic that could serve to block this cancer causing pathway.

In preclinical models, CA-4948 represses TLR and TLR -- I'm sorry, TLR and IL-1 receptor signaling pathways as well as cytokine production in vitro and exhibits anti-tumor activity in DLBCL tumor xenograft models as well as in patient-derived xenografts. Our ongoing Phase I dose escalation study of CA-4948 in patients with relapsed/refractory DLBCL and Waldenström's macroglobulinemia is designed to evaluate the safety and tolerability of CA-4948 in addition to PK/PD and anti-cancer activity with the goal of identifying the dose with which to move on to Phase II.

We're enrolling patients across 9 study sites in the U.S. with at least 3 patients enrolling for dosing cohort. We've dosed patients in continuous 21-day cycles, initially at 50 milligrams once daily and has since escalated all the way up to our current dose of 400 milligrams twice daily. Through the 200-milligram twice-daily dose, CA-4948 demonstrated a clean safety profile, dose proportional PK and strong evidence of pharmacodynamic inhibition of signaling of this oncogenic pathway.

And as we announced last quarter, we have seen evidence of anti-tumor activity in several patients across dose levels with greater activity observed as the doses increased. This initial data is quite encouraging, and we are continuing to dose escalate until we define the maximum tolerated dose and determine the recommended dose for Phase II studies.

This study is progressing well, and we expect to present updated data on CA-4948 at an upcoming medical meeting.

Lastly, as Jim mentioned, we plan to initiate a separate Phase I trial of CA-4948 in acute myeloid leukemia and myelodysplastic syndrome. We plan to provide further updates on this program as we finalize the study protocol and initiate our first trial in these indications.

So that sums up our ongoing clinical programs for fimepinostat and CA-4948, and we are greatly looking forward to reporting data on both candidates before year-end.

I'll now turn over the call to Bill to discuss this quarter's financial results. Bill?

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William Steinkrauss, Curis, Inc. - CFO [5]

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Thank you, Bob. Now for an update on our financial results. For the third quarter of 2019, we reported a net loss of $6.4 million or $0.19 per basic and diluted share as compared to a net loss of $7.2 million or $0.22 per basic and diluted share the same prior year period.

Revenues were $2.9 million for the third quarter of 2019 as compared to $2.8 million for the same period in 2018. Revenues for both periods comprised primarily of royalty revenues recorded on Genentech and Roche's net sales of Erivedge.

Operating expenses were $8.2 million for the third quarter of 2019 as compared to $9.3 million for the same period in 2018.

Research and development expenses of $5.1 million for the third quarter of 2019 as compared to $5 million for the same period in 2018. The increase was primarily driven by increased costs related to clinical activities for CA-4948.

General and administrative expenses were $2.9 million for the third quarter of 2019 as compared to $4.1 million for the same period in 2018. The decrease in general and administrative expenses was driven primarily by lower personnel, legal and consulting costs during the period.

Other expense was $1.1 million for the third quarter of 2019 as compared to $0.8 million for the same period in 2018.

For the third quarter of 2019, net other expense primarily consisted of imputed interest expense related to future royalty payments, whereas in 2018, the expense related to interest accrued on Curis Royalty's debt obligations.

As of September 30, 2019, our cash, cash equivalents and investments totaled $28 million and there were approximately 33.2 million shares of common stock outstanding. We anticipate that our existing cash, cash equivalents and investments should enable us to maintain our planned operations beyond our upcoming data catalysts for fimepinostat and CA-4948 and into the second half of 2020.

Now I'd like to open the call for questions. Operator?

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Operator [6]

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(Operator Instructions) This concludes our question-and-answer session. I would like to turn the conference back over to the company's President and Chief Executive Officer, James Dentzer, for any closing remarks.

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James E. Dentzer, Curis, Inc. - President, CEO, Secretary & Director [7]

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Thank you, operator. We made significant progress this quarter and have continued to execute on the goals we laid out for our company at the end of 2018. Although we did not observe single-agent efficacy in our CA-170 mesothelioma study, we remain intrigued by the role of VISTA in cancer. We plan to evaluate the translational science and clinical pharmacodynamics of CA-170 as well as the patient data from the Phase I study to determine our plan for future clinical development. We also continue to believe that VISTA is an important and scientifically validated target that is worth studying further, and we'll update you on our progress as we seek to address VISTA as a therapeutic approach for difficult-to-treat cancers.

As we turn to the last few months of the year, we're focused on advancing our clinical programs with fimepinostat and CA-4948 and are on track to report data from both programs before year-end.

Before we close, I'd like to thank all of the patients and families who participate in our clinical trials as well as our team at Curis and our partners at Aurigene for their commitment and support.

Thank you for joining us on our call today, and we look forward to updating everyone again soon.

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Operator [8]

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The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.