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Edited Transcript of CYTK earnings conference call or presentation 26-Apr-18 8:30pm GMT

Thomson Reuters StreetEvents

Q1 2018 Cytokinetics Inc Earnings Call

South San Francisco Apr 30, 2018 (Thomson StreetEvents) -- Edited Transcript of Cytokinetics Inc earnings conference call or presentation Thursday, April 26, 2018 at 8:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Andrew A. Wolff

Cytokinetics, Incorporated - Senior VP & Chief Medical Officer

* Ching W. Jaw

Cytokinetics, Incorporated - Senior VP & CFO

* Diane Weiser

Cytokinetics, Incorporated - VP of IR & Corporate Communications

* Fady Ibraham Malik

Cytokinetics, Incorporated - EVP of Research & Development

* Peter S. Roddy

Cytokinetics, Incorporated - Senior VP & CAO

* Robert I. Blum

Cytokinetics, Incorporated - CEO, President & Director

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Conference Call Participants

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* Chad Jason Messer

Needham & Company, LLC, Research Division - Senior Analyst

* Charles Cliff Duncan

Piper Jaffray Companies, Research Division - MD and Senior Research Analyst

* Ishmael Izakiel Gyimah Asante

Morgan Stanley, Research Division - Research Associate

* Jason Nicholas Butler

JMP Securities LLC, Research Division - MD and Senior Research Analyst

* Vernon Tolentino Bernardino

Seaport Global Securities LLC, Research Division - MD of Equity Research & Equity Research Analyst

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Presentation

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Operator [1]

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Good afternoon, and welcome, ladies and gentlemen, to the Cytokinetics First Quarter 2018 Conference Call. At this time, I would like to inform you that this call is being recorded. (Operator Instructions)

I will now turn the call over to Diane Weiser, Cytokinetics' Vice President of Corporate Communications and Investor Relations. Please go ahead.

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Diane Weiser, Cytokinetics, Incorporated - VP of IR & Corporate Communications [2]

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Good afternoon, everyone, and thank you for joining us today. Robert Blum, our President and Chief Executive Officer, will kick off the call with a few introductory comments about the current state of our business. Fady Malik, our EVP of Research and Development, will provide updates on our cardiac muscle program focused on the Phase III development program for omecamtiv mecarbil as well as preclinical development of our next-generation cardiac sarcomere activator and our cardiac sarcomere-directed compound. Andy Wolff, our SVP and Chief Medical Officer, will then share updates on our skeletal muscle program focused on the development of reldesemtiv. Pete Roddy, our SVP and Chief Accounting Officer, will provide a financial overview for the quarter; and Ching Jaw, our SVP and Chief Financial Officer, will recap our 2018 financial guidance as well as strategies to extend our cash runway before Robert concludes with additional perspectives on our company outlook and up upcoming milestones.

Please note that portions of the following discussion, including our responses to questions, contain statements that relate to future events and performance rather than historical facts and constitute forward-looking statements for purposes of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements may include statements relating to our financial guidance and goals, our strategic initiatives, our collaborations with Amgen and Astellas, clinical trials and the potential for eventual regulatory approval of our product candidates. Our actual results may differ materially from those projected in these forward-looking statements. Additional information concerning factors that could cause our actual results to differ materially from those in these forward-looking statements is contained in our SEC filings, including our most recent 10-K and 8-K. We undertake no obligation to update any forward-looking statements after this call.

And now, I will turn the call over to Robert.

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [3]

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Thanks, Diane, and thanks again for everyone for joining us on the call today. In the first quarter of 2018, we made key progress advancing our muscle biology directed drug candidates now in mid- and late-stage clinical trials across a spectrum of diseases and conditions of impaired muscle function. We continued protocol development and other readiness activities in collaboration with Amgen for the second Phase III clinical trial of omecamtiv mecarbil in patients with heart failure. We're finalizing preparations to ensure readiness to begin this trial on a time frame to be agreed soon. As a reminder, this trial will be conducted by Cytokinetics, mostly at Amgen's expense under our collaboration, while Amgen continues to conduct GALACTIC-HF, the Phase III cardiovascular outcomes clinical trial. That trial continues to enroll with patients randomized to date having a risk profile consistent with the trial design, and Fady will elaborate on that program in a moment.

As recently announced, during the quarter, we also completed enrollment of Cohort 2 in our Phase II clinical trial of reldesemtiv in patients with SMA under our collaboration with Astellas. And now, we look forward to reporting data later in this quarter at the Cure SMA Conference. Additionally, we continue to enroll patients in FORTITUDE-ALS and Astellas continued to enroll clinical trials of reldesemtiv in patients with COPD and also in elderly subjects with limited mobility. Andy will provide updates on that program shortly.

In the first quarter, we continued to advance potential drug candidates arising from our research pertaining to both cardiac and skeletal muscle, alone and in collaboration with our partners. We'll have more to say about the specific mechanisms of these compounds and their potential patient populations that they may serve at an R&D Day we're planning for the second half of this year.

I continue to be optimistic about Cytokinetics' opportunities this year. The results we expect to see from the Phase II clinical trials program of reldesemtiv will shed light on what we believe may be the potential to impact a spectrum of diseases and conditions of impaired muscle function, from rare neuromuscular diseases to diseases associated with aging, those characterized by muscle weakness that affect a growing population of aging baby boomers. With these data in hand, we and our partner, Astellas, can hopefully begin building the path forward towards those Phase III programs and advancing key objectives of Cytokinetics' Vision 2020.

Now, let me turn the call over to Fady so he can first update you on omecamtiv mecarbil.

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Fady Ibraham Malik, Cytokinetics, Incorporated - EVP of Research & Development [4]

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Thanks, Robert. GALACTIC-HF, the Phase III cardiovascular outcomes clinical trial being conducted by Amgen under our collaboration is proceeding well, with regulatory approvals now complete in 35 countries participating in this trial and all countries and sites in those countries currently enrolling patients. As Robert mentioned, we're pleased to note that the trial is on track and enrollment is proceeding towards 50% completion, with patients randomized to date having a risk profile consistent with the trial design.

In collaboration with Amgen, our teams are regularly reviewing patient characteristics and enrollment data by region, as well as accrual of the cardiovascular deaths and heart failure events that comprise the primary composite endpoints. Additionally, the data monitoring committee for GALACTIC-HF has been meeting regularly and reviewing data arising from the trial. There have been no major changes to the trial following these reviews. We expect to complete enrolling patients with chronic heart failure in GALACTIC-HF in approximately 1 year.

We also continue protocol development, feasibility assessments, regulatory interactions and other readiness activities for a second Phase III clinical trial of omecamtiv mecarbil that is planned to be conducted by Cytokinetics in collaboration with Amgen. As a reminder, this trial will focus on the potential effect of omecamtiv mecarbil on exercise performance in patients with heart failure, which could distinguish omecamtiv mecarbil from other medicines used for the treatment of heart failure.

During the quarter, we convened an advisory board meeting to review the study design and received positive and constructive feedback. We also conducted proprietary market research to better understand physician perceptions of increased exercise capacity. We found that more than 80% of key opinion leaders and nearly 70% cardiologists view this as highly beneficial and a clinically meaningful end point. Further, 67% of internists, who increasingly are seeing and treating these patients, viewed increased exercise capacity as a potential added benefit of omecamtiv mecarbil, addressing a significant unmet need to improve patient quality of life. Our goal is to finalize preparations to ensure readiness to begin this trial in a time frame to be agreed upon soon.

Together with Amgen, we are working on a development plan for a next-generation cardiac muscle activator that we have advanced from our research collaboration.

And now, I will turn the call over to Andy for updates and perspectives on our skeletal muscle program with a focus on reldesemtiv.

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Andrew A. Wolff, Cytokinetics, Incorporated - Senior VP & Chief Medical Officer [5]

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Thanks, Fady. Our clinical operations teams, both here and at Astellas, were quite productive in the first quarter, conducting a broad Phase II clinical trials program for reldesemtiv in neuromuscular and non-neuromuscular diseases characterized by impaired muscle functions. I'll first provide an update on progress against the 4 clinical trials underway under our collaboration with Astellas and then touch on our plans to transition patients currently receiving tirasemtiv in VIGOR-ALS, the open label extension trial for patients who completed VITALITY-ALS, to a managed access program.

As Robert mentioned, and as recently announced, data from our Phase II clinical trial of reldesemtiv in patients with SMA will be presented by Dr. John Day, Professor of Neurology and Pediatrics at Stanford Medical Center and the principal investigator of the study, at the 2018 Annual Cure SMA Conference on June 16 in Dallas. The study has enrolled 70 patients, 39 in Cohort 1 and 31 in Cohort 2. As a reminder, enrollment in this study was stopped short of the intended goal of 72 patients after a blinded analysis of variability for the change from baseline of several of the efficacy measures demonstrated at the trial appears to have sufficient statistical power to detect differences versus placebo in the efficacy endpoints. Given the evolving therapeutic landscape in SMA, moving forward expeditiously to understand if there is a potential effect of reldesemtiv on the function of patients with SMA is critical. It is important to remember that this is a Phase II exploratory hypothesis-generating trial with no single primary endpoint. The results will inform what may be a path forward for reldesemtiv in this patient population, and we look forward to sharing the data with the SMA community.

FORTITUDE-ALS, our Phase II clinical trial of reldesemtiv in patients with ALS, continues to enroll with more than 150 patients randomized as of April 19. We are adding sites in Australia and Europe with the expectation that they will contribute to overall enrollment. Over the past several months, senior members of our team have visited nearly every site participating in FORTITUDE-ALS to engage with our investigators, who continue to be optimistic about the potential of reldesemtiv in their ALS patients. Our goal is to complete enrollment this summer and we remain on track to report data in the second half of this year.

Moving to the non-neuromuscular trials, Astellas has nearly completed enrollment in the Phase II clinical trial of reldesemtiv in patients with COPD, and more than 20 patients have now been enrolled in the Phase Ib study of reldesemtiv in elderly adults with limited mobility toward a goal to enroll 60 patients. We expect results from the COPD trial in the second half of 2018 and expect Astellas to conduct an interim analysis of data from the Phase Ib study in elderly adults in Q4 2018. Skeletal muscle activation remains an exciting, viable and potentially versatile mechanism to explore across the spectrum of rare neuromuscular diseases as well as then impaired muscle function associated with aging that impacts the growing population of aging baby boomers. We look forward to results from these trials later this year and to advancing a potential Phase III development program in collaboration with Astellas. We are pleased to continue pursuing this novel mechanism with a shared vision.

Finally, I'd like to update you on the status of VIGOR-ALS, the open-label extension clinical trial of tirasemtiv for patients who completed VITALITY-ALS. During the quarter, we convened an advisory board of ethicists, patient advocates, trial investigators and experts in pre-approval access to assess whether and how best to continue providing tirasemtiv to those people living with ALS currently in VIGOR-ALS. Informed by this advisory board, we decided to close VIGOR-ALS and transition to a managed access program to provide continued access to tirasemtiv for patients still receiving treatment. The managed access program will include only patients still receiving tirasemtiv in VIGOR-ALS and not any other patients with ALS. We are grateful to the advisers who helped inform a strategy that we believe is in the best interest of patients in VIGOR-ALS who want to remain on tirasemtiv.

And now I will turn the call over to Pete to provide an update on our financials.

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Peter S. Roddy, Cytokinetics, Incorporated - Senior VP & CAO [6]

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Thank you, Andy. After I provide updates on our cash, our revenue and a little on the impact of the new accounting rules on revenue recognition for our strategic alliances with Amgen and Astellas, spending in R&D and G&A, Ching will review our guidance for 2018 and related financial strategies. More details on the financial results are included in the press release itself.

We ended the first quarter with $255.5 million in cash, cash equivalents and short-term and long-term investments. Regarding revenue from our strategic alliance with Amgen, as you'll recall, we exercised our option to fully co-invest $40 million in the Phase III development program of omecamtiv mecarbil in exchange for a total incremental royalty from Amgen of up to 4% on increasing worldwide sales of omecamtiv mecarbil outside Japan. Payments we made to fund that option in 2016 and 2017 reduced research and development revenues for those years. Under the new accounting guidance, these payments no longer reduce our revenue. We recognized a so-called contract liability as of January 1, along with the corresponding adjustment to our retained earnings. As of March 31, we had 2 more payments of $6.3 million in Q2 and Q3, and then will have paid all $40 million of our coinvestment commitment. Once we initiate the second Phase III clinical trial with omecamtiv mecarbil, which Cytokinetics will conduct, we'll see R&D revenue from Amgen for reimbursement of the related expenses.

All of our revenue in the first quarter 2018 came from our strategic alliance with Astellas. First, we recognized R&D services of $3.6 million and license revenues of $1.7 million from the ongoing development activities in ALS and SMA. Our first quarter 2018 R&D expenses were reduced to $22 million from $26 million in the fourth quarter of 2017. About 78% of our R&D expenses were attributable to our skeletal muscle contractility programs, which include both expenses associated with development and clinical trials for reldesemtiv and tirasemtiv; 9% to our cardiac muscle contractility programs; and 13% to our other research activities. These percentages approximate what we've seen in prior quarters with as-expected increases for reldesemtiv that are reimbursed by Astellas and appropriate decreases in spending for tirasemtiv. Our first quarter 2018 G&A expenses fell to $9 million from $10 million in Q4 '17, as expenses that we incurred in 2017 for commercial readiness for tirasemtiv were reduced. As mentioned in our last call, our commercial planning colleagues went to great lengths to, where possible, make planning commitments contingent upon potential positive results of VITALITY-ALS.

I'll stop there and Ching will share an update on our financial strategies.

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Ching W. Jaw, Cytokinetics, Incorporated - Senior VP & CFO [7]

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Thanks, Pete. I would like to reiterate our financial guidance for 2018 and remind you of our strategy to extend our cash runway through GALACTIC-HF, what we believe to be most valued catalyst for the company.

The company anticipates cash revenue for 2018 will be in the range of $17 million to $23 million, operating expenses will be in the range of $105 million to $115 million and net cash utilization will be approximately $100 million. This guidance is unchanged from the one we gave in February as Q1 spending is in line with our internal expectations. With the current cash of $255.5 million, this represents over 24 months of cash runway given our 2018 guidance.

As we have stated, our goal is to manage our cash through the GALACTIC-HF results without relying on dilutive financing. In addition to judiciously manage our spending, we will look for opportunities to raise non-dilutive capital through potential collaboration deals for our unpartnered cardiac sarcomere directed program, which we expect to advance to Phase I later this year. We also are eligible to receive collaboration milestone payments over this time.

We are proud to have raised an equivalent amount of capital from collaborative partners and capital markets throughout our company's history. As always, we will take a strategic and risk-mitigated approach to our financials and we are confident that we will continue to maintain a strong cash position while we advance our pipeline.

With that summary, I will now turn the call back over to Robert.

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [8]

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Thank you, Ching. So as you've heard, we made good progress in the first quarter of 2018, advancing our pipeline of muscle biology directed drug candidates. With 5 potential therapies moving through various stages of development, Cytokinetics continues to demonstrate leadership in areas of science and biology. We are powering innovation in diseases like SMA and ALS and also have opportunity to bring meaningful new approaches to the treatment of heart failure, COPD and frailty.

In Q1, we were thrilled to welcome Dr. Rob Califf to our Board of Directors. I've known Rob for many years and I'm quite gratified and excited to have him join our board. His expertise in cardiology and global clinical research will no doubt strengthen our overall ability to execute against our Vision 2020. His advice will be especially valuable regarding omecamtiv mecarbil in our Phase III clinical trials program in collaboration with Amgen as well as our preclinical compounds directed towards other severe cardiac diseases.

As always, we celebrate and acknowledge the brave people for whom we do all of this. This quarter, we joined the global Rare Disease Day initiative, an international campaign led by the European Organisation for Rare Diseases and the National Organization for Rare Disorders and shined a light on the innovative research powering therapeutic advances for people living with rare diseases.

Now, let me recap our expected milestones for 2018. For omecamtiv mecarbil, we expect to complete enrollment of patients with chronic heart failure in GALACTIC-HF in approximately 1 year. And we expect to finalize preparations for the second Phase III trial of omecamtiv mecarbil in 2018, which is intended to evaluate its effect on exercise performance in patients with heart failure.

For reldesemtiv, we expect results from a Phase II clinical study of reldesemtiv in patients with SMA in Q2 2018. We expect results from a Phase II clinical trial of reldesemtiv in patients with ALS in Q4 of 2018. We expect results from a Phase II clinical trial of reldesemtiv in patients with COPD in the second half of this year, and we expect Astellas to conduct an interim analysis of data arising from a Phase Ib clinical trial of reldesemtiv in adults with limited mobility by the end of the year.

For preclinical research, we expect to advance 1 development compound under our collaborations with Amgen and Astellas to Phase I in 2018. We also expect to advance an unpartnered cardiac sarcomere-directed compound through IND-enabling studies in 2018 to enable initiation of Phase I, also in 2018. And we expect to continue research activities under our joint research program with Astellas directed to the discovery of next-generation skeletal muscle activators.

Operator, with that, we can now open the call up to questions, please.

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Questions and Answers

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Operator [1]

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(Operator Instructions) And our first question is from the line of Matthew Harrison with Morgan Stanley.

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Ishmael Izakiel Gyimah Asante, Morgan Stanley, Research Division - Research Associate [2]

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This is Ishmael on for Matthew. Can you just walk us through how you'll be comparing the SMA data you'll generate to the data from SPINRAZA? And are there any specific endpoints or markers that you think are more relevant than others? And secondly, we understand enrollment is on track for ALS and data set for this year. However, are there any scenarios where the readout could be pushed to 1Q '19? Also, any commentary regarding tolerability on a blinded basis or patients on the higher dose, will be highly appreciated?

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [3]

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Sure. Lots of good questions. Let me try to start and then I may turn it over to my colleagues. With regard to reldesemtiv in SMA, clearly, this is a different mechanism of action than is nusinersen and as we've combed the literature, we think that the preclinical data with regard to nusinersen speak more to what's functional protein expression and less to functional measures that we'll be evaluating in our program. So it's difficult to make a comparative statement in any like models. In this Phase II study, as you know, we're looking at patients receiving both the low dose and a higher dose versus placebo, and within each of those groups, cohorts are divided, ambulatory and non-ambulatory, and within each, 2:1, drug versus placebo. So with regard to the assessments we're making, they really are functional assessments as I'll ask my colleagues to elaborate here in a moment. And in that way, I don't think you can make a comparative statement with regard to nusinersen. The patients in our study, to be clear, are not receiving nusinersen. Our study began before nusinersen was approved. And maybe I'll ask Andy and Fady to speak to what are those functional assessments and what we might expect from the study.

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Andrew A. Wolff, Cytokinetics, Incorporated - Senior VP & Chief Medical Officer [4]

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Well, there are numerous functional assessments. The Hammersmith scale is probably the most commonly used in several trials of patients with SMA, and that's the one that we're using in addition to Revised Upper Limb Module assessing upper limb function is probably one of the more standard measures of pulmonary function, including maximal expiratory pressure, inspiratory pressure and vital capacity. I think those are the ones that are probably most easily recognizable. Also, we're looking at respiratory function as well. But I think one of the key differentiators between the data that have emerged with SPINRAZA is primarily in SMA Type I. The use has been in patients, young children in the early years of their condition. In this trial, we've been studying patients 12 years and older that are generally have stable disease. And we're looking for functional improvement rather than trying to ameliorate the decline in their function as the treatment with SPINRAZA does in the earlier patient group.

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [5]

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Clearly, the commercial availability of nusinersen is a watershed moment for the treatment of SMA and it's abundantly clear that, that approach as well as other gene-directed approach like that of the gene therapy offer great promise. But we truly do see that this oral drug candidate may afford a complement for those patients living longer with impaired muscle function and weakness. So that's truly the therapeutic hypothesis that we'll be looking to understand with these data from this hypothesis-generating study. Your next question related to reldesemtiv in ALS, and I think you asked the question, what's the possibility that this may get pushed out. And I think based on having attended an investigators meeting yesterday at the AAN, I can say that there is a good deal of enthusiasm around this study. There aren't a lot of other competing studies right now for ALS, and I think with enrollment now proceeding well in over 50 centers across North America and soon also in other countries, we think we're on track to see data by the end of the year. We're still enrolling the study, and therefore, the possibility does exist that we would see that it gets pushed into 2019, but that's not our expectation right now based on where we stand. And your last question related to tolerability and while we remain blinded, we are as you know, looking at blinded data, and I think we are encouraged by the fact that the tolerability of reldesemtiv continues to hold for what we believe to be a better tolerated compound relative to tirasemtiv as should be expected given that it was designed specifically to engineer away some of the liabilities of tirasemtiv we know for it crossing the blood brain barrier. So, so far so good based on what we can tell from blinded data and we'll look forward to seeing those unblinded data later this year. I think that covered off on your questions. Operator, we can now go to the next one.

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Operator [6]

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Our next question is from the line of Chad Messer with Needham & Company.

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Chad Jason Messer, Needham & Company, LLC, Research Division - Senior Analyst [7]

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I was wondering if we could maybe discuss a little bit more the objectives of the omecamtiv exercise tolerance Phase III that you want to run and how you're going to use that to differentiate versus other heart failure treatments. Is it the case that other heart failure treatments don't help exercise tolerance or just that they haven't measured it? And if there's any sort of examples of what kind of endpoints would be possible to measure in a heart failure population for exercise tolerance? Any kind of examples of what might even be possible, that would be very helpful.

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Fady Ibraham Malik, Cytokinetics, Incorporated - EVP of Research & Development [8]

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Sure, I can speak in some generalities and later this year we'll speak more specifically about what the study will be designed to do. But your first question really is whether current therapies have demonstrated or have they even been studied in terms of their effects on exercise tolerance and indeed, they have. Beta blockers, for instance, have been studied and data published on several different papers that -- and don't improve exercise tolerance in these -- in heart failure patients. Beta blockers have a kind of a negative effect on skeletal muscle function directly. Obviously, over time, they have not very positive effect on cardiac function and so the overall effect is relatively neutral. The ACE inhibitors have also been examined in this way a long time ago, and in fact, I think ACE inhibitors -- one of the ACE inhibitors is the only heart failure drug that has a labeled claim in -- for exercise -- improvement of exercise tolerance. The MRAs haven't really been looked at in a rigorous fashion. And other therapies, probably the most key one is -- are device therapies such as cardiac resynchronization therapy. There, exercise improvement was the basis of approval of the first device, the first cardiac resynchronization device in heart failure. So I'd say that the data -- the effect on exercise is mixed across different heart failure therapies. There are different ways of measuring exercise tolerance that have been employed, 6-minute walk time is one mechanism for measuring exercise tolerance and has its challenges. Cardiopulmonary exercise testing is a quantitative way of looking at exercise tolerance. It has positives and negatives as well. There are also newer ways of looking at activity a.k.a. Elan and Apple Watch or some sort of device that measures steps or how often people are active and moving around as a way to look at activity over several days in a row rather than just a specific instance of testing someone. And so you'll see, I think, as we articulate the details of the protocol, we'll have solid ways of assessing exercise -- quantitative ways of assessing exercise performance. We'll employ some of these newer measures, and we'll also be looking at patient symptoms in heart failure as it related to their improvement in exercise performance. Does that...

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Chad Jason Messer, Needham & Company, LLC, Research Division - Senior Analyst [9]

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All right. Great. Yes, that's was very helpful and I appreciate that you actually prompted me to check my own Apple Watch and see how my heart rate's doing. So I appreciate that.

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [10]

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Glad we could be of service, Chad.

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Operator [11]

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

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Jason Nicholas Butler, JMP Securities LLC, Research Division - MD and Senior Research Analyst [12]

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Just 2 on the SMA study. Could you, just a clarification point, start with -- is it fair to assume we should not expect to see a top line press release before the conference in the middle of June?

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [13]

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Yes. It's a good question. Based on the fact that this is a hypothesis-generating study, not hypothesis-testing study, our current view, absent having seen the data, is that it may not rise to the level of materiality prompting the need to disclose the top line data. And having a look at all of these different endpoints and not knowing obviously the totality of those data, it's difficult to understand how we might summarize it strictly by top line announcement. That said, until we see the data, it's hard to know for sure. And based on where we think we are relative to last patient, last visit database lock and data analyses, it's going to be tough coming up right against the Cure SMA meeting. So currently, we're not anticipating that there would be a top line release in the days to weeks leading into that meeting, but that could change if we feel prompted based on the data themselves as we now prepare to see it.

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Jason Nicholas Butler, JMP Securities LLC, Research Division - MD and Senior Research Analyst [14]

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Okay, that was helpful. And then, can you just walk us through your -- the dose selection, what drove dose selection for the first 2 cohorts? Whether you think that there is an opportunity to go to higher doses and when you look at the blinded tolerability, do those data support going -- the potential to go to higher doses?

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Andrew A. Wolff, Cytokinetics, Incorporated - Senior VP & Chief Medical Officer [15]

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Well, the doses were selected based on the Phase I study you might remember where we stimulated the fibular nerve of healthy volunteers and found concentrations that were clearly associated with increases in skeletal muscle force production in those volunteers. The drug does appear to be well-tolerated if you look at the blinded data, and I wouldn't rule out the possibility that we may choose to go higher, but that will be based not only on tolerability, but what we see in terms of efficacy when we unblind the study.

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [16]

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Yes, at some point, we get to limits on what we can practically deliver in the way of drug, but we do have what we think is a considerably more well tolerated fast skeletal troponin activator and that seems to be borne out by these data, albeit still blinded. So we do think that we're within the pharmacodynamic range of what was evaluated in Phase I healthy volunteers, and therefore, we do believe that we're getting proper exposures in order to be able to see a signal of activity here across these different endpoints.

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Operator [17]

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Our next question is from the line of Charles Duncan with Piper Jaffray.

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Charles Cliff Duncan, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [18]

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I had a couple actually on ome and then reldesemtiv. So just quickly kind of going back to an early set of questions regarding the new Phase III that you guys will be conducting, I'm really intrigued with that in terms of if you can provide any more color on potential time frames, would you anticipate being able to be in the clinic with that study this year? And is it possible that, that data could -- or that study could actually read out before the GALACTIC-HF study?

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [19]

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So, yes, good questions. With regard to timing, as we mentioned, it really is something that still needs to be agreed, and there are couple of things that are factoring into that time line to agreement. One is just understanding from some ongoing regulatory interactions that we've got a final protocol and we understand, from the standpoint of feasibility of the study, what's going to be required in order to make it happen. And then we have to just sort through a couple of practical issues with Amgen in order to ensure that we're well coordinated and integrated with respect to drug supply systems, safety reporting and all of those kind of things that are getting ironed out. So I do think that there's a possibility that this could start later this year, and therefore, we're readying for that possibility, but there still needs to be some of these things to get finalized in order for that to occur. In terms of the time frame, the study is going to be substantially smaller than the GALACTIC study, but we have conducted feasibility assessments and working together with CROs, we understand sort of what to expect in terms of enrollment rates, number of centers, et cetera. And the goal is to, while starting this study later than GALACTIC, ensure that it's finishing before or at least concurrent with GALACTIC so that we have data from both studies in the same general time frame. And that's going to enable us to be in a position where both studies could hopefully form the basis of regulatory submissions. That's the intention.

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Charles Cliff Duncan, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [20]

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Okay. And that's very helpful. And then when you consider the patient population, I know that you're still finalizing this, but could you characterize at all the types of patients that you would anticipate being able to enroll in that study?

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Fady Ibraham Malik, Cytokinetics, Incorporated - EVP of Research & Development [21]

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Yes. I mean, these are going to be patients that will be similar to those that we're studying in GALACTIC with a couple important exceptions. One is, we obviously don't want patients that have been hospitalized in the recent past to when they are randomized because hospitalization changes your exercise tolerance. We're looking for patient population where they have a more stable baseline. They'll have reduced ejection fraction like patients in GALACTIC and they'll need to demonstrate reduced exercise tolerance prior to being enrolled.

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Charles Cliff Duncan, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [22]

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Okay. And then -- I appreciate that Fady. And then moving on to reldesemtiv. Yes, lots going on in the SMA -- was that AAN, sorry, I missed you Robert, clearly, very exciting times for that area. But it did seem like there's a complete lack of kind of work with, I'll call it, later-stage patients or older patients. And I guess I'm wondering when you think about the evolving treatment paradigm there and you mentioned that your study started before nusinersen was actually approved. How do you think about the opportunity? I know this is really a study meant to generate a hypothesis, but right now, could you see yourselves moving forward in SMA given the feedback that you've gotten with KOLs?

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [23]

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So the answer to that question is yes. We and Astellas are looking at these data as hopefully being therefore informing the path to Phase III and regulatory submissions that would lend support for movement to Phase III based on these data. Our expectation is that with nusinersen as well as gene therapy and other SMN-directed therapies that there's going to be an increasingly large population of patients living longer with SMA, but with residual weakness. And this mechanism should, hopefully, based on the therapeutic hypothesis, address those limitations, if not afford them improvements and increases in function over time. And it should be quite complementary both with regard to mode of administration, but also mechanism of action. So we're quite optimistic, and I know Astellas shares that same alignment with us, that this could be quite promising for a new approach to the treatment of these patients, expecting that this population grows over time, as well.

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Charles Cliff Duncan, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [24]

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Last question, and I appreciate you taking all the questions, is on reldesemtiv potential in ALS. Our diligence has suggested that, frankly, investigators were really quite disappointed. And I guess, I'm trying to gauge whether or not that's because of the paucity of really interesting innovation within ALS or if it's really driven by mechanism. So you said that you met with people, you felt good about the enrollment and interest in the trial. Do you have any further learnings from VITALITY and can you give us any insights on why there is continued interest in reldesemtiv within the ALS community?

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [25]

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Yes, I'll start and then ask Andy as well to join in. When you said folks were disappointed, I'm assuming you meant with regard to the results from VITALITY-ALS. Surely, we were disappointed as well. But a couple of things to note about that trial and now that we've had some time and distance from that trial, while -- why it may read more optimistically for reldesemtiv. We've been pouring over a lot of additional analyses, some prespecified and others, post-hoc analyses with respect to that trial. And there are couple of things that stand out. One is, clearly, the tolerability issues with tirasemtiv confounded the interpretation of those results. When looked at on an intent-to-treat basis, we had only a modest treatment effect observed with tirasemtiv versus placebo, and that was clearly disappointing and not sufficient for submission to regulatory authorities, but at least encouraging enough that there was some activity there that bore further investigation. When we look at the as-treated population and recognizing about 1/3 of the patients were not able to continue their treatment and dropped out based on mostly mild tolerability issues, but still sufficiently a nuisance that they dropped out. When you look at the as-treated population, we saw a borderline statistically significant effect that was durable over time. And that suggests to us that there is a biologic activity for this mechanism of action. And as we've talked to investigators and between me and Fady and Andy and others here at the company, we visited over 50 different clinical centers participating in FORTITUDE-ALS in this first quarter. And as we had conversation after conversation, it was extremely encouraging that mechanistically, that sites see benefit and merit to the approach we're taking with reldesemtiv, recognizing that it should be more well tolerated and also potentially more potent. And as such, I think there is enthusiasm because this is a compound for which mechanistically there is over 1,000 patients that have been studied in ALS and we've seen consistent effects that bore out for this approach. That's uncommon in ALS in as much as generally speaking in clinical trials, we've known very little about the mechanism and how it may translate to a therapeutic effect given how little we know about the etiology of this disease. So given all of that, I'd say relative to other clinical trials, there is more support, more interest, more enthusiasm for this trial than is the case otherwise and we're hopefully going to be in a position to enroll adequate numbers of patients. This will be a roughly 450 patient study. That, by itself is larger than most Phase III studies in neuromuscular diseases, and this Phase II trial really should inform what we hope will be support for movement into Phase III. The other thing to mention is in our VITALITY-ALS trial, we had a slower-than-expected decline in those patients who received standard of care and placebo, and that's something that we're still trying to get our arms around. Some data were presented today at AAN from another sponsor bearing out that the placebo event rate in studies with ALS is different in 2018 than perhaps it was in 2015 and 2016. The good news is, we believe we have, even as that may be the case in the FORTITUDE study, adequate statistical power to bear out the expectations in the therapeutic hypothesis. But it's a dynamic space that we are staying very close to, and as such, I think the FORTITUDE-ALS study is, amongst the clinical researchers, the most important study that should read out this year.

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Charles Cliff Duncan, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [26]

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That's helpful. And Robert, one last question regarding that event rate. Do you think that, that is the kind of typical thing that you see with more intensive therapy and perhaps even better awareness often attributed to being involved in a clinical trial? Or do you think the -- there's some organic shift in terms of how patients are reacting to current standard of care in ALS?

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Andrew A. Wolff, Cytokinetics, Incorporated - Senior VP & Chief Medical Officer [27]

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I don't know what it is, but I don't think it's just due to being in a clinical trial because these patients are progressing at a rate that is different from other patients in clinical trials that are fairly recent and that used very similar entry criteria that produced very similar baseline characteristics. But then despite the similar baseline characteristics, our patients went on to progress meaningfully more slowly than patients in recent but earlier trials. So there does appear to be something different in the population. It may be just that ALS care in general has become better. But it's difficult for us to actually put our finger on any one thing that would support that view.

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Operator [28]

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Next question is from the line of Vernon Bernardino with Seaport Global.

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Vernon Tolentino Bernardino, Seaport Global Securities LLC, Research Division - MD of Equity Research & Equity Research Analyst [29]

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Regarding the VIGOR-ALS study, it's good that some of these patients who want to remain are going to be able to continue receiving tirasemtiv. How long have the longest patients now been on tirasemtiv? And what are the long-term expectations, if there are any, as far as these patients that may provide you insight into tirasemtiv as well as reldesemtiv?

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Fady Ibraham Malik, Cytokinetics, Incorporated - EVP of Research & Development [30]

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Well, so I think the answer to the first part of the question, how long have they been on, some have been on as long as 2.5 years. Just to remind you, VITALITY-ALS included about a little over a year of exposure and then we certainly started VITALITY-ALS. It took us about 1 year to enroll that trial. So without having a calendar in front of me, I'd say we have about 2.5 years’ worth of continuous exposure in some patients. The -- we're not expecting necessarily to get any data out of them per se as we transition them to a managed access program. We'll -- obviously, as we conclude VIGOR, we will look to see if there are any interesting findings in the open-label extension, but I think the main thing that we get out of it is the mechanism of action appears to be very safe, well-tolerated for a long, long time in this patient population and we know that now having conducted VIGOR and VITALITY.

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [31]

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So there are approximately 90 to 100 of these patients that are still receiving tirasemtiv in VIGOR who appear interested in converting over to a managed access program. And to be clear, we have indicated that we've suspended the development of tirasemtiv. This is not with the goal of resurrecting the development of tirasemtiv as much as it's to do the right thing by these patients who believe that tirasemtiv is serving them well and in as much as they have committed to our clinical research, we want to reciprocate by making tirasemtiv available to them for so long as they want to stay on it. And I do think this affords us insights into the long-term tolerability for this mechanism, but that was less of concern to us. We believe that for those patients who did tolerate tirasemtiv in VITALITY-ALS, as I mentioned before, they appear to have benefited from it and want to stay on it. And I think that is most important because from our standpoint, that reads positively on what we might expect from reldesemtiv in FORTITUDE-ALS.

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Vernon Tolentino Bernardino, Seaport Global Securities LLC, Research Division - MD of Equity Research & Equity Research Analyst [32]

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No, that's a great segue because part of my thought is mechanistically, reldesemtiv is different. But you also have some follow-on compounds, just wondering if it also informs you as far as structures that may be similar to tirasemtiv that have improved tolerability or it's just really a stop -- very hard to stop here as far as that structural history?

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Fady Ibraham Malik, Cytokinetics, Incorporated - EVP of Research & Development [33]

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Yes, I think the -- we've continued to develop additional compounds with the same mechanism of action, bind in the same place, but they don't have any structural relationship necessarily to tirasemtiv.

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [34]

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We understand the SAR around this pretty well with different lead series having advanced but with the goal with reldesemtiv and others to ensure that they don't cross the blood brain barrier. Why we had these tolerability issues with tirasemtiv is not a mystery. We believe we do have an understanding as to what mechanistically is contributing to the off-target effect, and we believe we have successfully engineered that away with reldesemtiv and also the follow-on compounds as your question suggests.

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Vernon Tolentino Bernardino, Seaport Global Securities LLC, Research Division - MD of Equity Research & Equity Research Analyst [35]

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Yes, perfect. The only other question I have is regarding omecamtiv. So as you know, I often ask you about Entresto and Novartis' plans for that. At this point, it's just one more Phase III study that you have planned for omecamtiv?

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [36]

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That's correct. We and Amgen have agreed on these 2 studies, GALACTIC and this other one. That's not to say that in the future there might not be other studies that we might also agree on, but these are the ones that we're pointing to today.

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Operator [37]

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And there are no other questions in the queue. I'll turn it back over to management for any closing remarks.

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Robert I. Blum, Cytokinetics, Incorporated - CEO, President & Director [38]

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Thank you, operator. And thank you to everybody who participated in this call today. Q1 was obviously a very important quarter for us. We continue to be enthusiastic about our prospects for this year and afterwards. And with that, we will conclude the call. We appreciate your continued support and interest in our company. Operator, with that, let's close the call, please.

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Operator [39]

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