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Edited Transcript of KURA earnings conference call or presentation 7-May-19 8:30pm GMT

Q1 2019 Kura Oncology Inc Earnings Call

LA JOLLA May 15, 2019 (Thomson StreetEvents) -- Edited Transcript of Kura Oncology Inc earnings conference call or presentation Tuesday, May 7, 2019 at 8:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Antonio Gualberto

Kura Oncology, Inc. - Head of Development & Chief Medical Officer

* Marc Grasso

Kura Oncology, Inc. - CFO, Chief Business Officer & Secretary

* Pete De Spain

Kura Oncology, Inc. - VP of IR & Corporate Communications

* Troy Edward Wilson

Kura Oncology, Inc. - Chairman, CEO & President

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Conference Call Participants

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* Alexander Daniel Duncan

Piper Jaffray Companies, Research Division - Research Analyst

* Chris Shibutani

Cowen and Company, LLC, Research Division - MD & Senior Research Analyst

* Jay Olson

Oppenheimer & Co. Inc., Research Division - Executive Director & Senior Analyst

* Shawn Michael Egan

Citigroup Inc, Research Division - Senior Associate

* Wei Ji Chang

SVB Leerink LLC, Research Division - MD of Emerging Oncology & Senior Research Analyst

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Presentation

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Operator [1]

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Good day, ladies and gentlemen, and welcome to the Kura Oncology First Quarter 2019 Financial Results Conference Call. (Operator Instructions) I would now like to introduce your host for today's conference, Mr. Pete De Spain, Kura's Vice President of Investor Relations. You may begin.

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Pete De Spain, Kura Oncology, Inc. - VP of IR & Corporate Communications [2]

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Thank you, Skyler. Good afternoon, and welcome to Kura Oncology's First Quarter 2019 Conference Call. Joining me on the call from Kura are Dr. Troy Wilson, our President and Chief Executive Officer; Dr. Antonio Gualberto, our Chief Medical Officer and Head of Development; and Dr. Marc Grasso, our Chief Financial Officer and Chief Business Officer.

Before I turn the call over to Dr. Wilson, I would like to remind you that today's call will include forward-looking statements based on current expectations. Such statements represent management's judgment as of today and may involve risks and uncertainties that could cause actual results to differ materially from expected results. Please refer to Kura's filings with the SEC, which are available from the SEC or on the Kura Oncology website, for information concerning risk factors that could affect the company.

With that, I will now turn the call over to Dr. Troy Wilson, President and CEO of Kura Oncology.

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [3]

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Thank you, Pete, and thank you all for joining us this afternoon. We've made considerable progress over the past quarter as we continue to focus on the operational execution of our initial registration-directed trial of tipifarnib. The treatment cohort of this global open-label non-comparative trial is designed to enroll at least 59 evaluable patients with HRAS mutant head and neck squamous cell carcinomas. And I am pleased to report that it's proceeding and on track.

Meanwhile, we've enrolled additional HRAS mutant HNSCC patients in our ongoing Phase II trial which we call RUN-HN. We plan to provide an update from RUN-HN in second half of the year. We expect that this update will include additional follow-up on ongoing patients in the trial as well as preliminary data on newly enrolled patients in both the HNSCC as well as other squamous cell carcinoma cohorts.

Our goal with our registration-directed study is to generate a data package to support an application for marketing approval in HRAS mutant HNSCC as soon as possible while we work to broaden tipifarnib's potential use to include other diseases of high unmet need.

We've also made significant progress toward the identification of farnesylated protein targets as well as the potential mechanistic linkage between farnesyl transferase inhibition and CXCL12, further supporting the development of tipifarnib in a number of CXCL12-driven hematologic and solid tumor indications.

For more on this, I'll turn the call over to Antonio Gualberto, our Head of Development and Chief Medical Officer.

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [4]

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Thank you, Troy. Among the compelling features of the tipifarnib program, when we licensed it from Johnson, were the [fine subdural] antitumor activity observed across multiple hematologic indications as well as certain solid tumors. Despite this evidence of activity, the [mechanism of action] of farnesyl transferase inhibitors has remained elusive for decades. The data we had generated in HRAS mutant HNSCC provided a strong evidence of activity in tumors driven by this exclusively farnesylated oncogene. However, many of the other tumors in which evidence of activity have been reported, such as lymphomas, myeloid leukemia, pancreatic cancer or breast cancer, do not typically carry HRAS mutations.

In December 2018, at the American Society of Hematology Annual Meeting, we reported preliminary data from our Phase II trial of tipifarnib in later stage peripheral T-cell lymphoma. The data showed a significant association between CXCL12 expression and clinical benefit as well as clinical proof of concept in angioimmunoblastic T-cell lymphoma, an aggressive form of PTCL often characterized by high levels of CXCL12 expression. At the same time, we reported results from an ancillary nonclinical study which indicated that high CXCL12 expression is, in fact, a negative prognostic factor for a standard of care PTCL therapy. We also showed that tipifarnib can downregulate CXCL12 secretion in models of bone marrow stroma.

The preliminary result reported attached validated our observation that the CXCL12 pathway is a therapeutic target of tipifarnib and provided a potential pass to expand the development of tipifarnib well beyond HRAS mutant solid tumors by using CXCL12-related biomarkers to enrich for patients most likely to benefit from tipifarnib treatment. Importantly, CXCL12 [and its] receptors are known to contribute to metastasis. And elevated CXCL12 expression is known to be a poor prognostic factor in patients with certain tumors, including pancreatic cancer.

We are increasingly encouraged by our growing body of CXCL12-related data. And now the standing question however still remains, what are the molecular mechanisms that relay the inhibition of the farnesyl transferase enzyme with the observed antitumor activity of tipifarnib in patients with high CXCL12 expression? As previously stated, despite the fact of the number of large pharma companies and academic investigator have worked on farnesyl transferase inhibition for many years, no clear mechanism [of such] in the clinic have been defined.

Last month, at the American Association for Cancer Research Annual Meeting, we reported new findings suggesting that the gene expression of the exclusively farnesylated protein RHOE and PRICKLE2 is strongly associated with CXCL12 expression in bone marrow stroma. We believe this finding may help us identify a molecular mechanism connecting farnesyl transferase inhibition with the targeting of the CXCL12 pathway by tipifarnib.

In addition, an analysis of a subset of patients from a previously conducted Phase II trial in relapsed/refractory lymphomas identified CXCL12 expression as a potential biomarker of clinical benefit from tipifarnib in patients with diffuse large B-cell lymphoma as well as mycosis fungoides, the most common form of cutaneous T-cell lymphoma. These findings provide further evidence supporting the inhibition of the CXCL12 pathway as the mechanism of [action] mediating the activity of tipifarnib in the clinic. We believe that CXCL12 pathway biomarkers provide a core mechanism basis to enrich for clinical benefit across multiple hematological and solid tumors indications.

Now we look forward to providing additional data from the 2 cohorts in our ongoing Phase II trial of tipifarnib in last-stage -- later-stage PTCL, including durational response data from the AITL cohort and additional data from the CXCL12-positive PTCL cohort. I am pleased to report that these data have been accepted for oral presentation at both the European Hematological Association Annual Congress and the International Conference on Malignant Lymphoma, both in June.

Meanwhile, we continue our way, first, to further elucidate the biology of farnesyl transferase and the specific molecular mechanism [for action] of tipifarnib, including the identification of genetic mutations potentially associated with elevated CXCL12 expression, and we expect more to say on that at EHA and ICML next month as well.

With that, I'll turn the call back over to Troy.

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [5]

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Thank you, Antonio. I continue to be very encouraged by the progress our team continues to make with the tipifarnib development program. The discovery of CXCL12-related biomarkers offers the potential to significantly expand the therapeutic opportunity for tipifarnib as a treatment for patients with cancer.

Our development strategy for tipifarnib in CXCL12-driven tumors follows a similar approach that has served us well in our development of tipifarnib for the treatment of patients with HRAS mutant HNSCC. Namely, as we consider potential CXCL12-driven indications, we would seek to prioritize those for which there is the potential for rapid clinical development and an opportunity to move into earlier lines of therapy. Other key elements of this strategy include optimizing dose and schedule, validation of biomarkers that enrich for clinical benefit, evidence of durable clinical benefit and securing patent protection and/or regulatory exclusivity.

Ultimately, we believe CXCL12 pathway biomarkers could enable registrational strategies for tipifarnib in multiple hematologic and others -- and solid tumor indications with high unmet need. In the meantime, we look forward to providing additional prospective data from our ongoing Phase II trial of tipifarnib in CXCL12-positive PTCL next month followed by an update from our RUN-HN trial in the second half.

Now let's quickly turn our attention to our emerging pipeline programs beginning with our ERK inhibitor KO-947. KO-947 is a potent and selective small molecule inhibitor of ERK which we're advancing as a potential treatment for patients with tumors that have dysregulated activity in the MAP kinase pathway. Our preclinical data suggests that KO-947 has antitumor activity in KRAS or BRAS mutant adenocarcinomas as well as certain subsets of squamous cell carcinomas. We continue to evaluate dosing regimens for KO-947. Our goal is to reach a recommended Phase II dose or a maximum tolerated dose, and we believe we remain on track to accomplish that goal later this year. We would anticipate providing data on the Phase I trial when available.

Our third product candidate is KO-539, a potent and selective small molecule inhibitor of the menin-mixed lineage leukemia, or menin-MLL, protein-protein interaction. We've generated preclinical data that support the potential antitumor activity of KO-539 in genetically defined subsets of acute leukemia, including those with rearrangements or partial tandem duplications in the MLL gene as well as those with oncogenic driver mutations in genes such as NPM1. Our Investigational New Drug application for KO-539 has been cleared by FDA, and we're preparing to initiate our Phase 1 clinical trial in relapsed or refractory AML shortly.

With that, I'll now turn the call over to Marc Grasso for a discussion of our financial results for the first quarter of 2019.

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Marc Grasso, Kura Oncology, Inc. - CFO, Chief Business Officer & Secretary [6]

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Thank you, Troy, and good afternoon, everyone. I'll provide a brief overview of our financial results here on the call and invite you to review our 10-Q filed today for a more detailed discussion.

Research and development expenses for the first quarter of 2019 were $10.4 million compared to $11.6 million for the first quarter of 2018. The decrease in R&D expenses for the quarter was primarily due to a decrease in clinical development activities related to our Phase II trials of tipifarnib offset by an increase in clinical development activities related to our registration-directed trial for tipifarnib.

We continue to strengthen the research and development team with key hires in the areas of clinical operations and regulatory affairs. General and administrative expenses for the first quarter of 2019 were $4.6 million compared to $3.4 million for the first quarter of 2018. The increase in G&A expenses was primarily due to increases in noncash share-based compensation and personnel costs. Net loss for the first quarter of 2019 was $13.9 million or $0.37 per share compared to a net loss of $14.6 million or $0.46 per share for the first quarter of 2018.

As of March 31, 2019, we had cash, cash equivalents and short-term investments of $165.5 million compared with $179 million as of December 31, 2018. We remain well funded for our upcoming milestones and expect that our current cash, cash equivalents and short-term investments will be sufficient to fund current operations into 2021.

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

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [7]

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Thank you, Marc. This concludes our prepared remarks.

But before we jump into Q&A, let me just quickly lay out our anticipated near-term milestones: for tipifarnib, additional data from our Phase II trial in AITL and CXCL12-positive PTCL at EHA and ICML in June; additional data on biomarkers associated with elevated CXCL12 expression at EHA and ICML in June; additional data from our Phase II trial in HRAS mutant HNSCC and other HRAS mutant SCCs in the second half of 2019; and additional data from our Phase II trial in chronic myelomonocytic leukemia in 2019; for KO-947, data from our Phase I dose escalation trial in the second half of 2019; and for KO-539, initiation of our Phase I trial in mid-2019.

With that, operator, we're now ready for questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Your first question comes from the line of Jonathan Chang with SVB Leerink.

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Wei Ji Chang, SVB Leerink LLC, Research Division - MD of Emerging Oncology & Senior Research Analyst [2]

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Congrats on getting oral presentations at EHA and ICML. First question, as we look ahead to EHA, can you help set investor expectations on the upcoming PTCL data in terms of how many more patients, how much more follow-up, et cetera, will there be versus the data we got at ASH? And what do you see as the benchmarks in PTCL? And what would you consider a win in the upcoming data?

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [3]

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Thanks, Jonathan. I'm going to ask Antonio to address your 2 questions.

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [4]

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Yes. Thank you. So thank you, Jonathan, for the call. So the data that we presented at AHS indicated proof of concept in AITL, and if you recall at that time, we were still enrolling the CXCL12-positive cohorts. So without getting into the details, the intention is to provide data on both of the cohorts. And the only thing I can tell you is that there's certainly excitement from investigators, and the data was sufficient to drive 2 oral presentations at the lymphoma meeting at [atika]. So certainly, there was a strong interest from those in the field in the outcome of the data that was shown in the [astra].

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Wei Ji Chang, SVB Leerink LLC, Research Division - MD of Emerging Oncology & Senior Research Analyst [5]

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Got it. And I guess, how much new data would there be in the abstract versus the ASH presentation? Or should we expect it to largely be a placeholder for the upcoming presentation?

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [6]

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So that actually is a good question. So I can tell you that what we are expecting, basically, or what I will be expecting maybe addressing your initial question is to -- for the trial to have reached its objectives. And as you -- if you recall, the intention was we saw a level of activity, we saw selection and then we were attempting to reach proof of concept with certain level of selection, either based on histology or based on the marker. And again, based on that outcome, the data had driven 2 oral presentations.

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [7]

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But Jonathan, just to add to your question, given the timing of those abstracts, I mean those -- I don't know that I'd say they're placeholders, but the data has continued to mature since then. So I wouldn't be expecting in June to see a more mature data set than perhaps what's described in the abstracts.

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Wei Ji Chang, SVB Leerink LLC, Research Division - MD of Emerging Oncology & Senior Research Analyst [8]

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Got it. And maybe just one more question. Can you talk about the current status of the KO-947 ERK inhibitor Phase I study? Where are you in the dose optimization process? And how close or far are we seeing initial clinical data?

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [9]

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So this is -- it's a good question. As you know, it's quite a difficult target. There have been others that they have abandoned those programs. So the one thing that I can tell you is that we have sufficient confidence to continue escalating. What we want to make sure is that we have the appropriate regimen either for the extension cohort or a Phase II. So there are no reasons for us. There are no stops in the escalations. We are just trying to see -- trying to optimize what is the best regimen. So if that may happen by the end of the year, but the intent is to get that recommended Phase II dose and then select the patients based on the markers that were suggested by our preclinical data.

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Operator [10]

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Our next question comes from Chris Shibutani with Cowen.

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Chris Shibutani, Cowen and Company, LLC, Research Division - MD & Senior Research Analyst [11]

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I guess on menin inhibitor, can you give us a sense for perhaps a little bit of a preview on how you're framing the clinical development there? I believe there are -- there's another one that's also approaching the clinic and so I think we'll be keen to observe sort of what the different strategies and differentiation could be. Any additional insight would be helpful to kind of keep us engaged and tease us a little. That would be great.

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [12]

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So as you know, we appear to be ahead of others. We have an IND that was submitted, have been cleared by the FDA. [We are on a] start-up basis, it's a question of how soon you open your studies. And -- but I can tell you that, that will happen shortly. We don't have major delays. This is just a question of IRB paperworks, contracts, et cetera. It is a standard dose escalation, has some adjacent design, but it's not -- there are no major differences in what you will expect on a Phase I dose escalation, it's a refractory AML population, and our initial intent is not to select molecularly. Although at some point, we will look for those MLL rearrangements and NPM1 mutated population, where you are expecting to get activity. I don't know if that answered your question...

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [13]

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And as we think...

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [14]

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Go ahead.

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Chris Shibutani, Cowen and Company, LLC, Research Division - MD & Senior Research Analyst [15]

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Yes. So that's helpful. I think as we think about how AML, the landscape has changed quite rapidly over the past years with multiple new agents. Many of the physicians and also folks in drug development are thinking about it in terms of potential for combinations. And I'm wondering, if you can speak to the pathway and whether you not -- you believe that it'd make sense to contemplate potential combinations even at a pretty early stage of your development. And if so, is there a logical potential set of other agents to combine with when you think about either kind of mechanistically or as you anticipate what the clinical paradigm could be. And I realize that, that's evolving, but insights there, particularly regarding combination, that would be helpful.

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [16]

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Yes. It's a very good question. So I will say that you don't need to turn your back on the monotherapy for the simple reason that they're not specific therapies against the adult NPM1 mutated population. Now it's also true that NPM1 may be concurrent to other mutations. So you may have -- find patients, for example, that have NPM1 mutations and FLT3 mutations. So that give you opportunities on combination, although not as exciting, you should -- need to consider combination with the standard of care. So the way I will put it, you want to get your recommended Phase II dose monotherapy and pending whether you get or not early responses, you can consider combination both with the standard of care or with targeted agents for those that may be targeting the co-mutations that may appear with NPM1.

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Chris Shibutani, Cowen and Company, LLC, Research Division - MD & Senior Research Analyst [17]

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Great. And then lastly, for Troy, just on IP-related to tipi. I think in your current slide deck, you talk about some of the patent estate efforts that you've had, including where you outlined that you believe that you have for HRAS mutant out to 2036 and CXCL12 expressing out to 2037. From a pragmatic standpoint, are those the rough time lines that you're encouraging investor community to think about in terms of what the IP could go out to in terms of exclusivity?

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [18]

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Sure, Chris. So maybe just taking a step back before I answer your question. What we've brought to the table is an ability to connect the biomarkers, the disease and the dosing schedule. And if you look at the patents that have issued and the patent applications that are pending, that's the theme that runs throughout. That's the sort of inventive step, if you will. And we have been, I think, quite successful at getting patents issued not only in the U.S. but now they're beginning to issue in outside the U.S. We are guiding, as we show in the quarter presentation, we are imagining patent protection under multiple overlapping patents out, as you say, to 2037 or 2038 in the U.S., potentially even longer in Europe. And I think there's reason for optimism.

There really has never been a drug like this that, although it was in development, the exact molecular mechanisms were not known. And so that's given us a lot of sort of fertile ground. And I think you'll continue to see interesting developments from our patent portfolio throughout this year and into next year. So it's definitely something that is marching along very much hand in hand with the development strategy as that's playing out successfully.

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Operator [19]

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Our next question comes from Joel Beatty with Citi.

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Shawn Michael Egan, Citigroup Inc, Research Division - Senior Associate [20]

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This is Shawn Egan calling in for Joel. And I think I got one Troy and then one for Antonio. First, with more of a clarification question, for AIM-HN, the registrational study, if you hit the 15 confirmed responses are reject null, just kind of wondering how you'll roll that data out and then what will happen with that study kind of going forward. Will you continue to enroll patients to see if you reach your target objective response rate?

And then for Antonio, I know a more comprehensive update on the pancreatic study is forthcoming. But I'm just kind of wondering how you'll be able to leverage your recent pain analysis as a means of enrichment. Is pain objective enough to use as like an enrollment criteria? Or have there been any progress kind of tethering that your KRAS hypothesis.

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [21]

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Shawn, thanks for the questions. Let me take the -- your questions around AIM, and then Antonio can address the questions relating to the pancreatic data from ASCO GI. So with respect to AIM-HN, you're correct. The study is intended to enroll at least 59 evaluable patients. However, as we've said, if there -- if the -- if there are 15 confirmed objective responses, the study eliminates the null hypothesis and is a positive study. At that point, we would expect that the DSMB would notify the company that the trial had met its primary efficacy endpoint. We would, in turn, need to notify FDA, and we would likely also announce that publicly.

It would be our expectation that the trial, if enrollment was not complete, the trial would continue to enroll patients. But that would give us an opportunity to begin a dialogue with agency around next steps toward a submission very much in a manner in which our Phase II trial in HRAS mutant head and neck achieved proof of concept prior to the completion of enrollment and we were able to go and have an end of Phase II meeting with the agency. It's a very analogous situation.

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [22]

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So thank you for that reference. I mean the data that we presented at ASCO GI brought some excitement to the pancreatic investigators. So you are referring to pain. So pain actually, we use it as a connection with CXCL12 expression and is mostly potentially -- it will suggest a kind of like locally advanced population that is a good setting. But we have further [seen] analysis, I don't know if you recall, there was a relationship between CXCL12 expression and the real allele frequency of KRAS. And that can also be very helpful on the metastatic setting that, that could be potentially [done] -- early as possible for the registration.

So our intent is that -- to move potentially in a medical needs setting, could be potentially a second line, and to select the patients based on molecular tools. So we can really see at selection patient, for example, in KRAS, lower than 5% allele frequency that give you 30% of the population, which is a big chunk of patients, and potentially then apply CXCL12-related marker to determine where you select a little bit better on how you can identify the patients that develop responses or better clinical benefits.

So we do have with those tools and strategy, and we are currently in discussion with several KOLs, and our intent is to initiate a pancreatic study proof of concept this year.

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Operator [23]

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Our next question comes from Tyler Van Buren with Piper Jaffray.

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Alexander Daniel Duncan, Piper Jaffray Companies, Research Division - Research Analyst [24]

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This is Alex on for Tyler. Two questions for you. First, given the significant opportunity for tipifarnib, how are you thinking about which indications to prioritize for internal development or for partnership? And secondly, on the 947 program, with the recent excitement in programs that target KRAS and bearing in mind, of course, we don't the clinical data yet, how would you compare the potential for single-agent activity between KRAS and ERK inhibition? Or in other words, would you expect one to be more powerful than the other? And secondly, would it make sense for the KRAS inhibitor program to combine with your ERK inhibitor in combination therapy to improve clinical outcomes.

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [25]

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Sure. So those are 2 pretty meaty questions. With respect to your first question on prioritization of indications, it's a great question. It's something that we're talking about a lot about internally. I think we're quite encouraged by the way in which the CXCL12 hypothesis seems to be playing out.

We've shown prospectively validated AITL retrospective looks at AML, pancreatic, potentially, DLBCL, and now we're going to see again prospective data initially in PTCL and then later in the year in CMML. All of those indications have in common the, CXCL12 pathway seems to be driving the disease. One of the things that we've tried to focus on and we alluded to this in the prepared remarks is you want to get that initial anchoring indication that allows you to drive a smaller trial with a higher likelihood of success and gives you, really, a foothold to be able to become either part of the standard of care or displace the standard of care.

Where I think we're increasingly encouraged, that we see multiple opportunities for that, and we'll have more to say probably a little bit later in the year after we're able to share with you an update on our PTCL studies as Antonio mentioned at EHA and the congress in Lugano.

With respect to your second question, it's a good question. And there are 2 very, very different agents. And so it's hard to draw comparisons, particularly in the absence of data. The promise of the KRAS inhibitors, the G12C inhibitors, is that you are inhibiting an oncoprotein directly, and as a consequence of that, you have the potential for a reasonable therapeutic window. You do have to worry about mutations and resistance.

ERK, on the other hand, is a central actor where inhibiting both the -- where inhibiting the wild-type protein that is really a chokepoint for dysregulations in that pathway. And we've talked about it in the past, but there are 2 different -- 2 sort of distinct ways forward: One is you identify with ERK populations where you can drive meaningful single-agent activity. The other is that you identify opportunities where you drive clinical benefiting combination.

As far as we can tell, we're still optimistic that both of those are possible. We would, of course, want to gravitate toward single-agent monotherapy for the reasons that smaller companies can just do that more attractively.

Is there an opportunity to combine a KRAS inhibitor and an ERK inhibitor? Certainly. But I think -- there's an opportunity to combine an ERK with a number of different agents. But as Antonio mentioned, key to that is that you really have to understand what is your recommended Phase II dose and how best to use your agent, and then you can figure out how best to deploy it in a combination setting.

So we're very much keeping that question in the forefront of our mind as we work to finish out this Phase I setting and hopefully position 947 for the next step of development.

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [26]

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So the things that -- the other thing that we learned is that strategies are not necessarily mutually exclusive. So you can work on tipifarnib, on a pancreatic indication that could be most likely a combination and will require randomized trials. Some may take several years, but it will give you a large commercial opportunity. And in parallel, you can pursue an AITL or diffuse large B-cell lymphoma subset as monotherapy that translate to a registration. And for a company like us, having one registration lined up after another have a tremendous value.

So you could do both strategies in parallel and pursue anchoring indications that you can expand, then you can do label expansion at the same time that you have this kind of like big commercial opportunity that it is also developing on the background.

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Operator [27]

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(Operator Instructions) Our next question comes from Jay Olson with Oppenheimer.

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Jay Olson, Oppenheimer & Co. Inc., Research Division - Executive Director & Senior Analyst [28]

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Maybe if I could ask you to look ahead into the future, assuming that tipifarnib gets approved for an HRAS mutant population, could you help us understand what percent of that population is going to be treatable and what we should expect for our peak penetration levels? Since this is a very targeted indication, should we expect to see a high penetration level?

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [29]

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[I, honestly, would list] but the high penetration for the simple reason that in a setting of a said line where you are expecting 5% response rate, if you are reaching 50% response rate on a setting in which those patients had no responses, you are immediately displacing the standard of care. And seeing that the standard of care could be immunotherapies, they are not necessarily cheap. We are not displacing cisplatin. So I can see that you can expand vertically, moving all the way to the front line, trying to pursue a neoadjuvant setting. And then you can expand horizontally on those settings in which maybe the allele frequency is not the best for monotherapy, but you can add to the combination in immunotherapy, you can add to the combination with cetuximab. And then you are being carried by those agents because the reality is that either the mutation is at very high frequency from the get-go and is driving the tumor or appear later as a mechanism of resistance .

So that's data that is published, half from those progressions on cetuximab, they are RAS-mediated. At least half of those, they're going to be HRAS. So you can delay the resistance to the standard of care. So that gives you another 5% -- at least, 5%, 10% of the population that if you're [don't] do selection directly, combination obviously is much larger potential.

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Jay Olson, Oppenheimer & Co. Inc., Research Division - Executive Director & Senior Analyst [30]

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Okay. Great. That's very helpful. And then maybe as follow-up, just thinking about this CXCL12 population, you had identified at AACR, CXCL12 expression as a potential biomarker of clinical benefit in patients with DLBCL and a subset of CTCL. And apologies if I missed this, but are these indications on the horizon for development? And how will you prioritize them?

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Antonio Gualberto, Kura Oncology, Inc. - Head of Development & Chief Medical Officer [31]

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So first of all, I'm just going to reiterate that we are very excited. Obviously, we have the data coming at EHA and ICML, and this is being chaired by a number of investigators and KOL. And that give us a beachhead in lymphoma. So since that we will only in T-cell lymphomas. The data – the anecdotal data in mycosis fungoides give us the opportunity. So -- sorry, just backing up, even within peripheral T-cell lymphoma, we know that -- and this had been shown by Tom Witzig -- that skin lesions were disappearing in the initial data that he presented in 2011. So that together with now responses in CTCL, that show you that there's also activity in cutaneous T-cell lymphoma. That actually doubled the population of T-cell lymphoma.

Diffuse large B-cell lymphoma is obviously more interesting. Why? Because it's five times the size. There's more competition. But there's obviously a high unmet medical need and a very large population.

So we need to decide exactly, do we do basket studies. Do we do very targeted registration, is something that we are still discussing internally and with others. But we are going from a beachhead to a large opportunity. I mean there will be companies that they would just develop in this area on lymphoma by itself.

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [32]

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Yes, Jay, just to add to Antonio's comments, what we're trying to do is to demonstrate very clear Phase II proof of concept in these indications. So we started with HRAS mutant head and neck. You saw AITL at ASH last year. We're highlighting obviously the presentations in June and to the back half of the year, the CMML data. Those are giving us beachheads into the CXCL12-positive indications.

And then as Antonio mentioned, we said it a couple of times in a couple of different ways, it's a -- this is -- I put this in our basket of high-class problems. Can we pursue accelerated registrations as a monotherapy and in the meantime be laying the groundwork for these potentially much larger indications? We're -- rest assured, we're doing both and we're doing it in the context of tipifarnib being the only drug candidate we know of that has the clinical proof of concept on the CXCL12 pathway.

So we're trying to be thoughtful and stake out a near-term and intermediate-term and a long-term opportunity. And that's what's increasingly coming into focus.

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Operator [33]

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At this time, I'm showing no further questions. I'd like to turn the call back over to Troy for any closing remarks.

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Troy Edward Wilson, Kura Oncology, Inc. - Chairman, CEO & President [34]

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So thank you all once again for participating in the call today. We'll be at the Deutsche Bank Health Care Conference in Boston tomorrow and the Bank of America Merrill Lynch Health Care Conference in Las Vegas next week. And we look forward to seeing many of you there. In the meantime, if you have any additional questions, please feel free to contact Pete, Marc or myself.

Thank you again, and have a good evening, everyone.

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Operator [35]

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Ladies and gentlemen, thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.