Q3 2023 Chimerix Inc Earnings Call
Participants
Michelle LaSpaluto; IR & Vice President Strategic Planning; Chimerix, Inc.
Mike Andriole; President & CEO; Chimerix, Inc.
Joshua Allen; Chief Technology Officer; Chimerix, Inc.
Allen Melemed; Chief Medical Officer; Chimerix Inc
Naureen Quibria; Analyst; Capital One Securities Inc
Soumit Roy; Analyst; Jones Trading
Troy Langford; Analyst; TD Cowen
Presentation
Operator
Good morning, ladies and gentlemen, and welcome to the Chimerix third- quarter 2023 earnings conference call. I would now like to introduce you to your host for today's call, Michelle LaSpaluto, Vice President of Strategic Planning and Investor Relations at Chimerix. Please proceed.
Michelle LaSpaluto
Thank you, [Jhon]. Good morning, everyone, and welcome to the Chimerix third quarter 2023 financial and operating results conference call. This morning, we issued a press release related to our third quarter update. You can access the press release in our Investors section of our website. With me on today's call are President and Chief Executive Officer, Mike Andriole, Chief Medical Officer, Allen Melemed, and our Chief Technology Officer, Josh Allen.
Before we begin, I would like to remind you that the statements made on today's call include forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties and other factors. These risks and uncertainties and other factors could cause actual results to differ materially from those referred to in the forward-looking statements. Please refer to our filings with the SEC for more complete disclosure of these risks and uncertainties.
At this time, I would now like to turn the call over to our President and Chief Executive Officer, Mike Andriole,
Mike Andriole
Thank you, Michelle, and good morning, everyone. The third quarter was marked by continued execution across our pipeline, including continued enrollment in our global Phase 3 ACTION study of ONC201, and Phase 1 dose escalation studies for our second-generation compound ONC206.
I'll start with ONC201 and the ACTION study. We now have 113 sites open across 12 countries and tracking ahead of our prior guidance of activating 100 sites by September 30. Enrollment is progressing with site activation, and we continue to expect first and second interim overall survival data as well as PFS data in 2025.
Geographically, we now have about an equal number of sites activated in Europe as the US. This past September, we participated in the European Association for Neuro-Oncology Conference, also known as EANO in the Netherlands. And at that conference, we hosted a symposium on the current diagnosis treatment strategies and clinical trials for H3 K27M mutant glioma, and engage with the neuro-oncology community broadly to drive ongoing awareness and interest in the action study.
I was very pleased with the level of enthusiasm across the European community for this program and the degree of support from so many investigators who recognize the very high unmet need in this patient population. I was also reminded of the value to our industry of being back in person at medical conferences following the pandemic as attendance Adiana was at a new record high and we have seen a nice increase in site activity across Europe in the weeks since that conference ended.
That increases in addition to already strong engagement prior to EANO, we are now turning to North America, the annual meeting for the Society for Neuro-Oncology also known as SNO will occur in Vancouver, Canada in just a couple of weeks where we are also planning a large presence. I'll let Josh comment on our plans around this conference. So we're looking forward to seeing many of our investigators in the action study as well as other program collaborators later this month.
Our efforts in enrolling the ACTION study are also underpinned by a robust publication strategy that includes a recently published manuscript in cancer discovery this quarter. Which focused on frontline ONC201 survival data and further expand its mechanism of action.
Data from this peer-reviewed publication further strengthens our confidence in the ACTION trial and also further supports its enrollment. I'll let Josh speak more to the details included in this recent manuscript. As we continue to enroll the ACTION study, we're also simultaneously preparing the company and the market for ONC201's potential commercialization.
To that end we're in the process of finalizing recruitment of a Chief Commercial Officer, and I'm excited that that process is nearing completion. In fact, I expect to announce the hiring of that individual before the end of the year.
Turning briefly to ONC206, the protocol amendments for each of our dose escalation studies have been approved as expected during the third quarter. These amendments allow for a more intense dosing schedule that includes twice-a-day dosing up to three consecutive days weekly in order to increase the duration of therapeutic exposure.
We expect the continual 72-hour exposure of ONC206 to potentially generate additional monotherapy activity, both in CNS tumors and potentially tumors outside of the CNS based on emerging in vivo data. The PNOC in NIH studies are enrolling at the more frequent dose levels, and we expect dosing to be complete in the first half of 2024.
As you may recall, we previously reported the GBM response on the once a week schedule starting at Dose level 2, and that patient's response remains ongoing as the patient's dose level has increased. Since these studies began enrolling. Again, I'm also happy to report we have observed no dose-limiting toxicities thus far.
Before I turn the call over to Josh, I'd like to reiterate our deliberate disciplined approach to capital allocation. We ended the quarter with $217 million in cash and equivalents, which is on plan to meet our previous guidance of approximately $200 million in cash at the end of the year.
We continue to expect our cash balance to be sufficient to support operations into the end of 2026, and through each of the expected action clinical endpoints. For more details on our third quarter balance sheet and income statement, please refer to the press release which we released earlier today.
With that, I'll turn the call over to Josh to provide additional color on our recent publication in Cancer Discovery and our recent engagements with the neuro-oncology community.
Josh?
Joshua Allen
Thank you Mike. So we continue to see benefit from our connections to the global neuro-oncology community. As Mike mentioned, over the last quarter, we held a symposium at the European Association for Neuro-Oncology conference in the Netherlands. There, we met with leading neuro oncologist and active clinical trial investigators in addition to holding a symposium for presentations by thought leaders related to H3 K27M-mutant glioma, including the ACTION study.
Later this month, we will be similarly present at the Annual Society for Neuro-Oncology meeting in Vancouver, where we are planning a large presence, including a symposium on future directions of the diagnosis and treatment of H3 K27M-mutant glioma, as well as supporting our collaborators who will be making a series of oral presentations on preclinical and clinical studies of ONC201, in different treatment settings.
We're looking forward to seeing many of our investigators and collaborators in person as we drive continued engagement in the ACTION study and keep a close eye on emerging treatment strategies in molecularly- defined glioma.
In addition to these larger Neuro- Oncology conferences, we also remain actively engaged on the scientific front, including presentation of non-clinical data that reflect our deepening understanding of the novel mechanism of action of methadone at the AACR Special Conference in Cancer Research for brain cancer held in Minneapolis just a few weeks ago.
As Mike mentioned, our research manuscript co-authored by numerous academic investigators in Chimerix recently published in the journal Cancer Discovery that reflects several years of clinical translational and mechanistic investigations of ONC201 as a first-in-class therapy for H3 K27M-mutant glioma. The manuscript describes data that support a range of important conclusions for ONC201 and H3 K27M-mutant glioma that span its mechanism of action, its biological activity within patients' tumors and its clinical activity that extends beyond the prior efficacy analyses in the recurrent setting.
Starting with the mechanistic finding, the data provide a step-by-step understanding of why ONC201 is uniquely poised to address this disease that starts with the engagement of its [clip, P]. binding target in the mitochondria and ends with reversal of the H3 K27M trymethyl [loss] event in the nucleus. Reversal of this epigenetic hallmark is remarkable as it is the direct consequence of the H3 K27M mutation and is thought to be the path of physiological driver of the disease.
These findings were consistent across disease models and importantly, reversal of H3 K27M trymethyl loss was robustly evident across all tumor biopsies obtained from ONC201 treated patients.
Turning to clinical outcomes, the survival of H3 K27M mutant glioma patients who received ONC201 the frontline setting following radiotherapy, which I'll notice is the same setting of the ACTION trial was reported as 21.7 months from diagnosis, in contrast to 12 months for patients who did not receive ONC201.
Favorable survival outcomes among ONC201 treated patients were consistently observed across a variety of sensitivity and subgroup analyses. It is worth noting that while the previously disclosed results for ONC201 in the recurrent setting were skewed towards adult patients in Thalamic primary tumor locations. This front line data set described in the manuscript were skewed towards pediatric patient and Brainstem tumor locations.
Aggregately these findings demonstrate that ONC201 is the first-in-class therapy for H3 K27M mutant glioma that consistently reverses the major driver of the disease pathology and appears to be associated with compelling outcomes in uncontrolled trials across multiple clinical settings.
These findings boost our confidence in the prospective randomized controlled evaluation of ONC201 the ongoing action study, which is further strengthened by inclusion of dose intensification to twice-weekly dosing.
With that, I'll turn the call back over to Mike for closing remarks.
Mike Andriole
Thanks, Josh. During the third quarter, we've continued to execute our plan with a focus on bringing ONC201 to patients as soon as possible. We're beginning to prepare our organization to potentially launch ONC201 and are excited about the promise to further broaden our pipeline in the future by advancing ONC206 and or through business development. With that, operator, we'll open the call question.
Question and Answer Session
Operator
(Operator Instructions) We will pause for just a moment to compile the Q&A roster. Thank you.
Maury Raycrof, Jefferies.
Hi, this is James on for Maury. Congrats on the progress and thanks for taking our question. Can you talk more about the progress on site initiation, enrollment, feedback from investigators, specifically in Western Europe and also Canada? And can you bookend timeframes for when you could reach full enrollment of the 450 patients needed for the study?
Mike Andriole
Sure. And thanks for the question, James. Engagement in Western Europe, actually across all of Europe, has been strong, I think, as evidenced by the speed of site activations to date in that part of the world. I'd say Canada has been a little bit slower, but from a regulatory perspective, that's not entirely unusual. But engagement at sites with investigators has been quite strong in both geographies.
In terms of when we would expect full enrollment in the study. We haven't given that guidance, but continue to reinforce our guidance to have first interim efficacy overall survival data in the first half of 2025. So you might expect it would be similar timeframe. If you just look at the number of events required to hit that in timelines.
Got it. Thanks. And where are you in enrollment for the consecutive dosing Phase cohorts, ONC206? Do you anticipate that you would press release that data at an earnings call have a separate event of that or would you present that data at an upcoming medical conference?
Mike Andriole
Yes, good question. We've got two separate arms, Pediatric, Recurrent. Frontline and the Pediatrics. PNOC study and then a separate, obviously study with the NIH. So for three different in a way arms ongoing with that Phase 1 studies, James. And so we're not going to give a play-by-play on where we are with each one, but all three are enrolling and we continue to expect that will have enrollment completed in the first half of '24.
I think that will likely top line the safety data to the extent that there's efficacy insights that we can gather from that. We'll do that at that time. But I want to probably set expectations that if you look at the least the parent compound ONC201 and the recurrence setting, there was an 8.3-month time to onset of response.
And so there's a natural lag between maturity of those patients into our response and when we might have safety data. So there's probably a two-step process in terms of identifying safety data and an additional insight from an efficacy, a responder perspective.
The other insight I'll make is some of those patients who will qualify for those studies may have seen ONC201 previously. And so we could have resistance mechanisms built in that would make assessing response more difficult.
We also have some patients in the PNOC study that are in the frontline setting and therefore, confounding a response assessment, really making the money valuable for response. And so we're really focused on the recurrent setting in patients who are naive to the methadone class and assessing response. So we'll look at the totality of the data at the time, but I think that's likely the top line safety data first and that we would press release and then followed perhaps by mature and efficacy data.
Great. Thank you for taking our questions. I'll hop back in the queue.
Mike Andriole
Sure.
Operator
Naureen Quibria with Capital One. Please go ahead.
Naureen Quibria
Hi, good morning. Thanks for taking my question. I guess I'll start first with ONC206, the patient response --the GBM patient responder, you see the patients still on study, you know, how long has the patient been on therapy? And can you comment on what dose, how many doses they've received the different level?
Mike Andriole
The patient's been -- yeah Naureen, well first, thanks for the question, Naureen. That patient has been on study for about a year and a half at this point. So it's been quite some time, a very durable response. They have continued to dose escalate.
Last I heard I'll ask Allen or Josh to weigh in on this, but I my understanding is they graduated to dose level four. It was the last piece of information I had on that patient. Josh, do you have other insights?
Joshua Allen
Not much to add I know that that patient has had dose escalated at least twice since the initial dose level at 100 milligrams. I know the investigators reported a deepening of response at that dose escalation has occurred in that patient, which is very encouraging.
But overall, I think the macro messages we're compelled by this idea that ONC206 continues at the preclinical level to show signs of efficacy outside of H3 K27M mutant glioma. Clearly, that was a strong indication that can translate at least in that patient.
As Mike has pointed to, we look forward to continuing execution at this intensified dose schedule and taking a careful look within the response valuable population in the study. To see what the path forward looks like outside of H3 K27M. So great news for that one patient and look forward to see more of that.
Naureen Quibria
Great. And thanks, Josh. And maybe this one's for you or Allen. Do you -- can comment on what type of data on this patient and any of the preclinical type of data that we presented at the upcoming SNO conference.
Mike Andriole
Go ahead, Josh, I think you're closest to that. Go ahead.
Joshua Allen
I'll start with SNO, Naureen and just mentioned that we expect at least three oral presentations to occur at SNO on ONC201 two of them are related to positioning until one as a combinatorial backbone, right? Given the DMGs, right? Given the signal from the monotherapy that this drug has produced its safety profile, its oral administration, et cetera.
Really physicians that is an ideal backbone therapy. So some of the mechanistic data, pre-clinical rationale and been available emerging clinical safety and outcomes associated with [200], as a backbone therapy will be presented in SNO. I think that's going to be the subject of a couple of those studies. So you'll expect to see more of that at SNO.
Naureen Quibria
Terrific. Okay. And just one more. Can you just remind me with the ONC206 trials that are ongoing, the dose escalation. Is it just post radiation or do they receive a little bit of Temozolomide as well?
Mike Andriole
There are arms that have -- that are in the frontline setting post radiation and also arms that are at recurrence. I believe Temozolomide is allowed prior to initiation of [ONC206]
Allen Melemed
Mike, I can answer that. The Phase 1 studies, it's a little more open on the inclusion criteria as we are trying to get safety for this patient population. I think bonuses if we did some signs of activity needed evaluate where we are seeing this activity, and that will help us decide vertical for future.
Naureen Quibria
Okay. Thanks so much.
Operator
Soumit Roy, Jones Research
Soumit Roy
Good morning, everyone, and congratulations on all the progress. On ONC206, excuse me. Could you remind us the dose escalation is going to be with 100 milligram dose level twice weekly? And how much does exposure increase do you expect on the prior schema?
Mike Andriole
Yes, Soumit, I'll have Josh, perhaps contribute to this, too. But we have a slide in our deck that essentially lays out the dose frequency and schedule. So the next two dose levels following reactivation of this new protocol are evaluating similar. Essentially similar exposures and dose levels that were given once a week, but doing it fractionated over three days and then escalating up from there. Big picture, we'll end up at about four times the dose on a weekly basis if we make it all the way to dose level 11, Josh, anything to add?
Joshua Allen
No, I think you covered it.
Soumit Roy
Okay, So and then with the time to response being about eight months or so, and I'm expecting this patient just got the dose escalation part just got initiated. So the data is most likely we are thinking end of '24. Is that a correct assumption? The efficacy data?
Mike Andriole
I think to the extent that we have valuable efficacy data, it will come in likely after completion of of the safety analysis. Right, Soumit and so we'd expect that, as we said in the first half or middle part of next year. And we'll share what efficacy insights response insights we have at that time. And we'll update that during the course of the year as those patients continue to be followed.
Soumit Roy
And one last question, in terms of the location of the tumor itself, we should expect a broad range, right between anything between the PON, DIPG, Stem?
Mike Andriole
Yeah this is looking at primary CNS tumors. So it's going to be a fairly heterogeneous patient population.
Allen Melemed
The only exception is -- Soumit this is Allen. The only exception as we are excluding patients, how you typically see with [CNS] disease [or] looking outside of that, but otherwise the broader sort of CNS disease.
Soumit Roy
Understand that. Thank you so much and congrats again on the progress.
Mike Andriole
Thanks, Soumit.
Operator
Joel Beatty, Baird.
Good morning. Hi, this is Ben on for Joe. Thanks for taking our questions. First question is what expense trajectory do you expect over the next few quarters?
Mike Andriole
Hi Ben. I'm sorry to clarify. Was that expense trajectory you asked?
Yes sir.
Mike Andriole
Yes, it will be it will be similar. I would expect if you look at our first half run rate in terms of cash burn in 2023. And this latest quarter, we're averaging $15 million, $16 million, $17 million a quarter. I would expect that to continue over the next couple of quarters (multiple speakers)
I was just going to add as we begin to prepare for commercialization, you might see an uptick in expense. But I would say in the grand scheme of things, there would be just at the margin.
Great. That's super helpful. And then I guess on the identification of biomarkers for ONC206 for future efficacy studies, would you expect the biomarkers to be similar to the biomarkers you showed for ONC201 Cancer Discovery publication or something different?
Mike Andriole
Yes, really good question, then I'll let Josh weigh in on that. Josh?
Joshua Allen
Yeah Ben great, great question. And as you would expect from, we've been working on ONC201 alone in this platform for a number of years now, and we're expecting to leverage all of that molecular information we've gathered from those efforts important into the ONC206 program.
So what I'll say is we're really excited about what we're seeing with ONC206. We've been working hard in the lab ourselves and with collaborators and have generated a growing body of compelling in vitro and in vivo efficacy that we're excited about.
As we've mentioned, the potency increase and the alternative engagement of additional target engagement interactions we've seen with ONC206 relative to ONC201. While that may not be a meaningful opportunity for H3 K27M mutant glioma, given that ONC201 is having on target saturation there. We think there's a lot of other opportunities outside of H3 K27M, both within the CNS and outside of the [CNS] that can be addressed by ONC206.
So we're seeing signs of that in preclinical studies. Clearly, we've reported on this one responder early in dose escalation in the Phase 1, for ONC206 that endorses that hypothesis. And what we're looking to do now is take some of these molecular biomarkers, some of which you're pointing to but good ideas can come from anywhere.
So we're trying to take for all of those ideas we have for specific molecular driver alterations in cancer that could be associated with ONC206 heightened activity and test some of those hypotheses against the de-compelling preclinical activity we're seeing so that we can run towards actionable alterations in follow-on trials. If that's appropriate.
So good question. Good thinking, and we're hard at work testing a lot of these theories that include what we've learned from ONC201 and ONC206 over years.
Great. Thanks for the insights also from us.
Operator
Troy Langford,TD Cowen
Troy Langford
Hi. Congrats on the progress this quarter and thanks for taking our questions. First one just on ONC206. So with respect to the Phase 1 dose escalation work, do you have any Phase 1 work for both the NIH sponsored study in the PNOC sponsored study to complete around the same time. And if not, would you need to wait for both of those to finish before you move forward with the program?
Mike Andriole
Yes, good question, Troy. We do expect them based on what we know right now to complete around the same time. I don't think we have any insight there. They would be materially different, of course, as we get closer and to the final dose levels, assuming that we don't have a safety event that would stop us earlier. At a particular dose level -- right now are planning for them to complete around the same time if that should change, then, of course, we'll update you accordingly.
(multiple speakers), Allen is going to add. Allen?
Allen Melemed
The only thing I would add is that on ONC206. So it's really how quickly can fill the cohort close the cohorts and then opening new cohort. So there's high demand here.
Troy Langford
Okay. Great. And then just other one on ONC206. So with respect to some of the expansion opportunities for that compound, just provide any color around how you think about balancing investment into some of those other areas with the need to preserve the cash runway for the ACTION study?
Mike Andriole
Yes. Great. Great question. And so as we think about capital allocation, we have earmarked some capital on balance sheet for Phase 2 studies that could be ONC206. Could be another compound may be it may be that could be in-licensed as we've said in prior quarters Troy, the bar for business development, continues to be high because we continue to see early preclinical and clinical data with 206 that continues to raise the bar for anything else we would pull in and allocate capital to.
Clearly if we the more substantial of a Phase 2 study, we might run with ONC206 would shorten the runway. And well, we'll evaluate that when we make that decision.
To what extent would we shorten the runway? What are access to other dilutive or nondilutive capital and in particular and any additional insight we might have on milestone payments that might be forthcoming from Emergent BioSolutions, with respect to the TEMBEXA divestiture we made last year all factor into that calculus.
But it starts with how much conviction do we have in the data to date on ONC206, both preclinically and clinically and sharing that data with the market, making sure that conviction is shared externally as well.
Troy Langford
Great. Thanks for all the extra color, and that's all for me.
Mike Andriole
Sure.
Operator
I will now turn the call back over to Mike Andriole for closing remarks.
Mike Andriole
Thanks, John. Thank you, everyone, for your time this morning. For those of you attending the SNO conference this month. Please stand by our booth. Otherwise, we look forward to updating you again in the coming months.
Operator
Ladies and gentlemen, that concludes today's call. Thank you all for joining You may now disconnect.
