Q4 2023 MEI Pharma Inc Earnings Call

Participants

David Walsey; SVP, Corporate Affairs; MEI Pharma, Inc.

David Urso; President & CEO; MEI Pharma, Inc.

Richard Ghalie; Chief Medical Officer; MEI Pharma, Inc.

Jay File; CFO; MEI Pharma, Inc.

Yale Jen; Analyst; Laidlaw & Co.

Stephen Willey; Analyst; Stifel

Presentation

Operator

Good day and welcome to the MEI fiscal year-end earnings call. My name is Gary and I will be the conference facilitator today. (Operator Instructions)
Please note today's event is being recorded.
I would now like to turn the conference over to David Walsey, Senior Vice President of Corporate Affairs at MEI Pharma. Please go ahead, sir.

David Walsey

Thank you, Gary. Hello and thank you for joining the MEI Pharma conference call today. My name is David Walsey and I'm Senior Vice President of Corporate Affairs for MEI. With me today on the call from MEI are David Urso, President and Chief Executive Officer; Jay File, Chief Financial Officer; and Dr. Richard Ghalie, Chief Medical Officer.
Before turning the call over to David for opening remarks, I'd like to remind you that during today's call, we'll be making forward-looking statements. Certain information contained in this communication that are not historical in nature are forward-looking statements within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements regarding the potential safety, efficacy, and regulatory and clinical progress of our product candidates, including the anticipated timing for the initiation of clinical trials and the release of clinical trial data and our expectations surrounding potential regulatory submissions, approvals, and timing thereof, our business strategy and plans, sufficiency of our cash, cash equivalents, and short-term investments to fund our operations.
You should be aware that our actual results could differ materially from those contained in the forward-looking statements, which are based on management's current expectations and are subject to a number of risks and uncertainties, including but not limited to: our failure to successfully commercialize our product candidates; the availability or appropriateness of utilizing the FDA's accelerated approval pathway for our product candidates; final data from our preclinical studies and completed clinical trials may differ materially from reported interim data from ongoing studies and trials, costs, and delays in the development and/or FDA approval, or the failure to obtain such approval for our product candidates; certainties or differences interpretation in the clinical trial results; uncertainty regarding the impact of rising inflation and the increase in interest rates as a result; potential economic downturn; activist investors; our inability to maintain or enter into and the risks resulting from our dependence upon collaboration or contractual arrangements necessary for the development, manufacture, commercialization, marketing, sales, and distribution of any products; competitive factors; our inability to protect our patents or proprietary rights and obtain necessary rights to third-party patents and intellectual property to operate our business; our inability to operate our business without infringing the patents and proprietary rights of others; general economic conditions; the failure of any products to gain market acceptance; our inability to obtain any additional required financing; technological changes; government regulation; changes in industry practice; and onetime events.
We do not intend to update any of these factors or to publicly announce the results of any revisions to these forward-looking statements. Under US law, a new drug cannot be marketed until it has been investigated in clinical studies and approved by the FDA as being safe and effective for the intended use.
With that, I'll now turn the call over to David Urso.

David Urso

Thank you, David, and thank you all for joining us today. On today's call, I'll make some opening remarks and then turn the call over to Richard Ghalie, our Chief Medical Officer, to review our progress. Jay File, our Chief Financial Officer, will then provide some brief financial comments before moving to Q&A.
Before getting started, I want to welcome Jay. He was just appointed our CFO as of August 1. So this is his first earnings call at MEI and we're very happy to have him on the team.
With that said, I'll make a brief statement regarding the termination of the merger agreement with Infinity Pharmaceuticals before moving on to review our business. Regarding that proposed transaction, while we believe the potential upside of the Infinity merger was compelling for MEI stockholders, we value the perspective of our stockholders. With the proposed transaction behind us, we're committed to pursuing our two promising clinical-stage programs as a standalone company.
Looking ahead over the next few quarters, we see important opportunities in the continued progress of our two clinical-stage oncology programs, voruciclib and ME-344. I would like to use this call to provide an update on the status of these programs and why we're optimistic about their potential.
Both of our assets represent novel mechanisms of action. Voruciclib is an oral CDK9 inhibitor and ME-344 is a mitochondrial inhibitor that inhibits the OXPHOS pathway. We are investigating the potential of these compounds to overcome resistance mechanisms to standard-of-care therapies: the BCL2 inhibitor, venetoclax or voruciclib; and the VEGF inhibitor, bevacizumab, in the case of ME-344.
The ongoing advancement of each program is based on nonclinical, and in the case of ME-344, clinical data supporting proof of principle for the respective combinations. We chose these combination approaches based on clear hypotheses to address the known resistance mechanisms of each standard-of-care therapy, clear medical need, and significant commercial opportunities.
We are working with some of the leading oncologists in the country in both of our clinical studies, and we're pleased with their level of engagement and interest in our programs. We expect data readouts from each program in the coming months.
With respect to voruciclib, as previously reported, we've seen promising data from our ongoing Phase 1 study. Recall that voruciclib has a selective CDK9 inhibitor, regulates the transcription of MCL-1, and through that mechanism, also potential to address a known venetoclax resistance mechanism. The ongoing Phase 1 study is evaluating voruciclib as a single agent and in combination with venetoclax, which is standard of care in AML and used in other hematologic malignancies as well.
Richard will provide more detail shortly. But in brief, voruciclib alone and in combination with venetoclax has been generally well tolerated in the Phase 1 study to date with no significant myelosuppression in patients with B-cell malignancies or AML. The results further demonstrate encouraging early clinical activity in heavily pretreated patients that progressed on venetoclax who were administered voruciclib monotherapy and at the initial dose level in combination with venetoclax. The planned voruciclib data readout in early 2024 is expected to include data from the dose ascending cohorts in the Phase 1 study evaluating voruciclib plus venetoclax in patients with AML.
Here are some of the leading KOLs we are working with. We're pleased with how the study is enrolling.
As for pending ME-344, we're pursuing a novel approach to cancer therapy with the combination of ME-344 and OXPHOS inhibitor that inhibits the production of ATP and mitochondria, and bevacizumab, a VEGF inhibitor, which inhibits the production of ATP through glycolysis to deprive cancer cells of the energy needed to proliferate.
Bevacizumab is an established standard of care in multiple solid tumors, including colorectal cancer. Our ongoing Phase 1b study is evaluating metastatic colorectal cancer patients with ME-344 plus bevacizumab. This novel approach to treatment has also generated enthusiasm among our investigators in the ongoing study.
In earlier clinical studies, ME-344 was generally well tolerated at the dose we're currently investigating and there was evidence of clinical activity as a single agent. We had a first look at the potential for this combination in a 42-patient controlled window of opportunity clinical study in HER2 negative breast cancer patients waiting for mastectomy.
Richard will discuss the decrease in the proliferation in biomarker, Ki-67, observed in that study. We expect that the ME-344 data readout planned in the first half of 2024 will include initial safety and efficacy data from the first 20-patient cohort in the Phase 1b study evaluating ME-344 in combination with bevacizumab in patients with metastatic colorectal cancer.
We believe that the potential value of both programs is notable given that the addressable market opportunities for voruciclib in combination with venetoclax and ME-344 in combination with bevacizumab are significant. Venetoclax is currently used across AML, CLL, and double-hit DLBCL and generated approximately $2 billion in 2022 worldwide sales.
Venetoclax sales are continuing to grow and are expected to generate $3.4 billion by 2028. Avastin and bevacizumab biosimilars are used to treat a variety of cancers, including colorectal cancer and ovarian cancer. 2022 worldwide Avastin and bevacizumab biosimilar sales reached $2 billion in 2022 and are expected to grow to $3.3 billion by 2028.
In short, MEI's pipeline is promising and presents substantial opportunity for delivering novel therapeutics for patients and value creation for MEI stockholders. Voruciclib and ME-344 have the potential in combination with current standard-of-care therapies to overcome known resistance mechanisms and improve patient outcomes.
Each program is supported by nonclinical, and in the case of ME-344, clinical data, demonstrating antitumor activity and mechanistic proof-of-concept for the combinations being evaluated. We anticipate reporting data for voruciclib early in calendar 2024 and in the first half of 2024 for ME-344. We look forward to these data readouts and the next steps these data will form.
I will now turn the call over to Richard Ghalie, our Chief Medical Officer, to provide additional details on our pipeline. Following Richard's remarks, Jay File, our Chief Financial Officer, will provide a brief financial overview before moving to Q&A.

Richard Ghalie

Thank you, David. And I'll begin first by discussing voruciclib, a selective oral CDK9 inhibitor drug candidate. The mechanism of action of voruciclib is depicted in this cartoon. Voruciclib block the transcription of MCL-1 and meet at the Pol II level of DNA transcription. In addition, voruciclib block -- it includes the stabilization of the NIC protein, which has a downstream effect on that pathway. In a moment, I will give more detail to the meaning of these two targets.
voruciclib had a favorable PK and PD profiles that allow its use orally because it's bioavailable. It is selective to CDK9 compared to other CDK as shown to the table -- on the table to the right where they have more binding affinity and longer residence time for CDK9 compared to the other CDK.
In addition, voruciclib had more selectivity to CDKs compared to other candidates. Voruciclib is potent with an IC50 ranging from 0.2 to 1.7 micromolar in a variety of cell line tested. And interestingly, it concentrates in tumors over plasma which is relevant in patients with solid tumors or lymphoid malignancies with tumors.
Now let's focus on the two targets of interest. The protein MCL-1, it is known that its increase is associated with poor prognosis in patients with acute myeloid leukemia or AML and in a variety of B-cell malignancies. In addition, upregulation of MCL-1 is an established mechanism of resistance to venetoclax. As venetoclax inhibit BCL2, it can lead to stabilization of MCL-1 leading to resistance to venetoclax over time.
Independently and separately, we also know that MYC is overexpressed in a variety of cancers and tend to be associated with poor prognosis. In addition, the MYC pathway include KRAS mutation, which would be relevant for the discussion about the potential role of voruciclib.
Let's begin first on the aspect of inhibition of MCL-1. As mentioned, it is relevant for AML and B-cell malignancies and as a way to address venetoclax resistance. MEI focus its initial development in the hematologic malignancy beginning with AML. The reason we selected AML is because venetoclax-based therapies are standard of care and approved in elderly patients who are unfit to receive intensive chemotherapy. Based on the NCCH guidelines, it has been established also as the center of care in a variety of market research, including the one sided on the right.
In addition, ongoing studies are being conducted to establish the role of venetoclax as part of the standard of care in chemotherapy eligible patients. Our hypothesis is voruciclib combined to venetoclax has the potential to restore sensitivity to venetoclax, and therefore, improved durability of response.
This slide summarizes the nonclinical data that support the combination of voruciclib and venetoclax in AML. This is in murine xenograft model. In panel A, it shows suppression of MCL-1 well level. In panel B, it shows that either agent all alone has activity in AML, but the combination is synergistic with further increase in apoptosis level. And that corresponds to an improve in survival in the model depicted here in AML. We have similar data with the combination with venetoclax in CLL and diffuse large cell lymphoma models.
Now moving to describe the Phase 1 study. This is a typical Phase 1 dose escalation expansion study in patients with relapsed-refractory AML and B-cell malignancy in the first stage, which is the monotherapy dose escalation and in patient with relapsed and refractory AML for the combination with venetoclax stage.
As part for Phase 1 studies, its endpoints consists of safety, pharmacokinetic. We are also collecting samples for biologic correlate primarily to look at the BH3 profiling and MCL-1 expression as well as molecular mutation analysis. And we will also collect, of course, activity data.
The monotherapy dose escalation component has been completed with 40 patients enrolled, and we are now currently enrolling in the combination with venetoclax group in patients with AML. As mentioned, this is a two-stage component. First, a dose escalation going from 50 milligram every other day upward. And as of now, we have completed enrolment at the 150-milligram dose level.
Once (inaudible) dose that is confirmed to have well tolerated as well as evidence of activity, then we will proceed to expansion cohort. Currently, there is one contemplated and additional expansion cohort will be discussed with the FDA. In total, this study will enrol over 100 patients with hematologic malignancies, including approximately 70 patients and the combination with venetoclax.
This is a brief summary of the data observed in the monotherapy dose escalation. Primary data were presented at the ASH 2021 and additional data and final data were presented at some subsequent scientific meeting. In total, 40 patients were enrolled, all heavily pretreated with a median of 3, prior therapy ranging from 1 to up to 8 therapies in one patient.
Two-dose schedule evaluated initially daily continuously in 16 patients. And we have, at that time, pivoted to evaluate voruciclib on a 14-days on, 14-days off therapy, and a 28-day cycle. And the reason for this pivot is because we have seen in the daily dosing two patients' pneumonitis that we felt were confounded by patient having developed differentiation syndrome, seen an AML patient receiving targeted therapy, as well as prior allogeneic transplant with graft versus host disease.
When we switch to the two weeks on, two-weeks off schedule, we're able to dose escalate up to 200 milligram without seeing DLTs. We stopped dose escalation not because of safety reasons, but because we wanted to start pivoting to the combination with venetoclax, our target combination regimen.
With the monotherapy, we have seen patient having evidence of anti-tumor activity, including one patient with AML who has a morphologic leukemia-free state achieved and 5 of 10 patients with AML at the 200-milligram dose who have stable disease.
Importantly, we have seen in our collective laboratory studies done with collaboration at academic centers a decrease in MCL-1 and MYC using a single cell RNA sequencing from three patients with CLL and two patients with AML.
So overall, voruciclib as a monotherapy at a dose of up to 200 milligram only 14-days on, 14-days off schedule was well tolerated, had no DLT. We did not see drug-related neutropenia. We did not see Grade 3 or higher drug-related toxicity and no patients were discontinued due to drug-related toxicities.
As mentioned, we are now enrolling in the venetoclax combination. Up to now, we have not seen DLTs. The PK analysis of the earlier dose levels do not show drug-drug interactions. And we are seeing evidence of clinical activity at the low dose evaluated today, manifested by reducing transfusions, improved counts, response observed in some patients, and over 85% of patients continuing beyond cycle one, the DLT windows. Keep in mind, this is observed in patients who have been heavily pretreated with a median of two prior therapy, including venetoclax.
Now let's turn the focus to voruciclib effect on MYC. As mentioned, MYC is overexpressed in a variety of cancer and tend to be associated with poor prognosis. There is no current treatment approved for MYC-mutated tumors. CDK9 inhibition lead to reduced transcription of MYC and stabilization, thus, going to have a potential treatment effect.
We have clinical data from the initial studies conducted in patients with solid tumors about the prior sponsor. Two studies were conducted: one using a two-weeks on, one-week off schedule; and the other one using a daily continuously schedule.
Relevant to the discussion today is in the daily continuous scheduled study, samples were obtained from 25 patients with a variety of solid tumors and tested on a 10-gene biomarker with sample obtained at baseline and with each subsequent course of therapy. We have seen a decrease in ischemic expression in 60% of the patient tested in that study.
And here are shown on the two illustrative example of two patients circled are the MYC gene that will be evaluated, showing a decrease in MYC over time with each course of therapy. At MEI, we have further expanded the evaluation of that effect on MYC and KRAS by evaluating a number of cell lines listed here, including colorectal cancer and other tumors that had variety of KRAS mutation, G12C, but also others. And shown to the panel to the right is a dose response relationship between voruciclib dose and suppression of tumor growth in three different cell lines with different KRAS mutation.
And lastly and of interest is combination of voruciclib with the KRAS inhibitor, sotorasib. This experiment was conducted in a pancreatic tumor cell model. This is intralesion of infusion of one or a combination of drug. And the readout is shown to the panel to the right where we see two types of analysis. One is the standard pathology with an HA staining that shows the control arm, either agent alone. And to the bottom-right panel, the combination showing an evidence of cell death, pyknotic cells, and also in the fluorescent staining, an increased number of cells died.
So that is my summary for the voruciclib program. Now I'm turning to description of ME-344, a mitochondrial inhibitor drug candidate. This is a very interesting and novel mechanism of action where the inhibition of the mitochondria is a dual effect: one on OXPHOS, and two, on purine synthesis, reminding that purine synthesis is made at the surface of mitochondrial cells.
The relevance of that mechanism is illustrated the panels to the right, which I will simplify by saying that mitochondria generate ATP, which are essential for producing energy for cells. And that is done through the OXPHOS pathway. Blocking the OXPHOS with ME-344 would lead to a decrease in ATP source of energy and eventually, by a cascade of event, to potentially cell death.
Separately, purine biosynthesis is done, as I said, at the surface of mitochondria, which ME-344 can block to reenact essential to cell proliferation and blocking purine biosynthesis could lead to a decrease in cell growth and proliferation.
This is a simple panel of over 200 cell lines that were tested for ME-344 activity in vitro. And as one can see, ME-344 is potent at the nanomolecule level and nearly all cell lines tested, except a few. MEI conducted two Phase 1 studies: one at the single-agent dose escalation to determine the safety, efficacy, and PK, and that study led to the determination that recommended Phase 2 dose for further development is 10 milligram per kilogram.
The next study evaluating ME-344 with the chemotherapy, topotecan, in a couple of type of solid tumors. 48 patients enrolled this study, myelosuppression due to topotecan was observed. We had disease stabilization at 49% of the patients. However, MEI decided to pursue the development of ME-344 in a different direction on the basis of biology.
However, before I go to that, this is a table summarizing the safety profile of ME-344 as a single agent in the Phase 1 study, pointing to the fact that neuropathy was seen only at doses higher than 10 milligram per mg kilogram was the dose limiting toxicity. It was not reported at lower doses.
Now let me describe the new strategy that we would like to employ ME-344 in combination with the anti-angiogenic agents, primarily Avastin or bevacizumab. This stems for a simple observation that when Avastin is administered to patient, it blocks the glycolytic energy pathway, leading to effect on cell growth.
However, cells are (technical difficulty) versus the ATP I mentioned earlier. Therefore, it is plausible that combining ME-344 to block the mitochondria's energy and VEGF inhibitors like Avastin with now having possibly of synthetic lethality and therefore, improving anti-tumor control.
This hypothesis was tested initially in animal models, of which I present two: one, a colorectal cancer model; and one, a breast cancer model using ME-344 in combination with oral VEGF inhibitor, nintedanib and regorafenib. And seen on this slide is a decrease in tumor growth with the combination compared to either agent alone and improve survival in colorectal model.
This led to a study by collaborators at the NCI Spain in Madrid, a multicenter study, a proof-of-concept study evaluating ME-344 and bevacizumab in patients with breast cancer. The recent breast cancer was selected because that is a window of opportunity for this type of mechanistic study where patients between diagnosis and definitive surgery has a period of time where this study could be conducted.
It was a randomized control study in 41 patients. Group A receive bevacizumab with ME-344, just one cycle, and Group B received bevacizumab alone. The readout was a PET scan to look at tumor vascularization and tumor biopsy, looking primarily at the biomarker of tumor proliferation called Ki-67.
Results are illustrated on this slide. Group A, again, is the combination of ME-344 and bevacizumab in green. As you can see, looking at all patients enrolled on this study, there was a significant decrease of Ki-67 compared to an observed with bevacizumab alone.
Focusing now on the subset of patients in this study who had a tumor normalization -- vascularization normalization by PET, this effect is further enhanced. This led us to the decision now to proceed in a clinical trial with clinical readout. And we selected colorectal cancer as the first study to evaluate the combination because it's an unmet need and Avastin is used in that setting.
So this is a Phase 1/2 study in patient relapsed colorectal cancer after failure of all standard therapy. Primary objective is progression-free survival. Second objective are survival and safety. The study is conducted in separate cohort, beginning with cohort 1 and using the same dose and schedule that was used in the breast cancer study.
20 patient will be enrolled and the readout will be four months after the last patient is enrolled. And considered as a positive outcome is a PFS at four months of 20% or higher. Then that will lead to evaluation of a second cohort and subsequent dual cohort to be discussed with the FDA.
With that, I conclude the clinical update, and we'll turn it to Jay File to talk about the financial overview.

Jay File

Thank you, Richard. As reported earlier today, as of June 30, 2023, MEI had $100.7 million in cash, cash equivalents, and short-term investments with no outstanding debt. We believe our cash balance is sufficient to fund operations for at least the next 12 months and through the reporting of clinical data readouts from the ongoing and planned voruciclib and ME-344 Phase 1 and Phase 1b clinical programs, respectively.
I look forward to any questions on the broader set of financial information reported earlier today during the Q&A portion of the call. I'll turn that back to David.

David Urso

Thanks, Jay. As you've heard today, I believe we have two exciting programs with expected data readouts beginning with voruciclib early in calendar 2024 and in the first half of 2024 for ME-344. With the promising pipeline and capital to support our near-term development plans, we're excited about the potential to create stockholder value and deliver improved therapeutic options for patients.
Before we turn to Q&A, I'd like to briefly acknowledge that two of our stockholders, Anson and Cable Car, have initiated a consent solicitation process and separately submitted three director candidates to stand for election at the company's Annual Stockholder Meeting this year. We have had several conversations with Anson and Cable Car as part of ongoing efforts to resolve the situation and remain open to further discussion. We will appropriately address the actions of these stockholders in due course.
For the purposes of this earnings call, we are here to discuss our programs and upcoming milestones. We ask that you please keep your questions to these topics.
I'll now ask the operator to provide the instructions for asking questions and then open the call for Q&A.

Question and Answer Session

Operator

(Operator Instructions)
Yale Jen, Laidlaw & Company.

Yale Jen

Good afternoon and thanks for taking the question as well as providing a clear view of what's happening currently. Maybe I start with a housekeeping question that you got about $100 million cash. And in the press release, you suggested that you have 12 months, maybe a little bit longer runway.
Given that you are still in Phase 1 -- 1/2 study, should we anticipate it to be a more conservative estimate or any additional thoughts behind that in terms of the runway? And I have some follow-up as well.

David Urso

Thanks, Yale. This is David. I would say it's conservative in the sense that we've got all the capital we need to do the Phase 1 programs as we're currently -- they're currently planned and as we have some ideas about augmenting them.
But going into Phase 2 is really data driven. And so it's really impossible to speculate about the next phase of development for these programs. So I think it's an appropriate guidance in that respect. It's at least 12 months and covering the current work that we're doing. So you could characterize it as being, I guess, somewhat conservative, but we did say at least 12 months.

Yale Jen

Sure. And maybe just in terms of -- again, the housekeeping one, which is the top line. I understand the prior deals are completed. So should we anticipate some top line coming just because of the amortization? Or we should anticipate that to be stopped in the early and near term?

David Urso

I'm sorry, could you repeat? We are having a little bit of trouble following the question. Could you please repeat it?

Yale Jen

Sure. In terms of the top-line revenue that you have this quarter, my question is that would that continue -- will it continue for the subsequent fiscal year or simply these revenue numbers just the amortization of the prior revenue received?

David Urso

Yeah. I mean, all the revenue we're recognizing is all KKC driven from our collaboration with them. So it's not anticipated to continue into the future.

Yale Jen

Okay. Maybe the last question here is in the clinical side over voruciclib Phase 1 data readout. What should we anticipate specifically in terms of type of data? Would that -- other than the safety, would that be PK and would that be any biomarker or other aspect? Could you provide a little bit of color on that?

Richard Ghalie

Yes, this is Richard. Yes, it will be a combination of safety data primarily since this is the primary endpoint in Phase 1 study. Perhaps a recommended Phase 2 dose. There will be also PK data and biomarker analysis. All of them will be available.

Yale Jen

What specific -- would you already have some biomarker in mind? If so, what that might be?

Richard Ghalie

All right. So I've mentioned it when I present the monotherapy dose escalation, the biomarker that we are evaluating, our BCL1 profiling, particularly MCL-1 expression. We are looking at multiple molecular biomarkers such as MYC. And we will be looking at potentially other biomarkers that are relevant and directly to the effect of CDK9 on the target.

Yale Jen

Okay. Okay. Great. Yeah, I'll get back to the queue. And thanks for the color.

David Urso

I mean, I guess we could also say that just from a clinical perspective for the cohort 1 from ME-344, we will be looking at PFS. And for the voruciclib expansion cohort that's in our protocol right now, we'll be looking at how large. So those are just standard clinical endpoints for the two respective diseases.

Yale Jen

Actually, let me -- if I can maybe just follow up as well on that. You said a 20% or higher of the threshold. So moving forward for ME-344 study cohort 1. What other factors determine that? The 20% was the number for the cutoff?

David Urso

So that was a requirement or a gate that we reached in collaboration with the clinicians. We really need to dig into exactly what the patient population is before we really know what the meaning of that threshold is. It obviously depends on exactly the experience of each patient.

Yale Jen

And maybe again, one more question here, which is that: if compared to what your prior study in the breast cancer or non-small cell lung, was there any comparable number to that PFS?

Richard Ghalie

Yeah. This is Richard answering. So it's really two very different approach to therapy here. In the Phase 1 study in combination with chemotherapy, we were really looking at cytotoxic effect and looking at response as the primary endpoint.
Here, we are really looking at a different approach, whether it's synthetic lethality by combining VEGF inhibitor with them mitochondria inhibitor, and therefore, the response rate is less relevant. More relevant would be the time to progression.
Again, it's a very different disease. So it will be hard to compare breast cancer -- or rather I'm sorry, colorectal cancer on one hand with a prior study, which was done in ovarian cancer and small cell lung cancer.

Yale Jen

Okay, great. That's very helpful. Thank you, all. I appreciate it.

Operator

Mr. Willey, your line is open on our end or perhaps, you haven't muted on yours.

Stephen Willey

No, thanks for taking the questions. Maybe just one on voruciclib, one on 344, and then just a modeling or financial question. So on voruciclib, what's your expectations just around venetoclax retreatment, post-progression in the context of AML?
And I guess I ask the question because there's not a lot of data that's out there in the public domain on sort of re-treatment experience. In CLL, that's shown that you can resensitize patients to venetoclax -- with venetoclax alone. I'm just kind of curious, as you think about the data you're going to be generating, what's good, what's interesting? What is your working assumption around venetoclax retreatment response rates?

David Urso

Yeah. I mean, in the initial experience with venetoclax in the relapsed-refractory AML population was pretty limited. I think was like 19 patients and they saw about a 20% response rate. But as you know, that was in a venetoclax naïve population. Now everybody is getting venetoclax.
But I think when we talk to our advisors, it's still around the same threshold is what they would be excited by. I think it's a big deal if you can bring back response to a patient that progressed on venetoclax. And 20% to 30% response rate in that -- in this relapsed population, I think, would get everybody excited.

Stephen Willey

Okay. And then 344, I think per clintrials.gov (sic - "clinicaltrials.gov"), it doesn't list any of the approved salvage regimens as allowable prior therapy. So are we to assume that these patients are going to be Lonsurf and regorafenib naïve?

Richard Ghalie

This is Richard. So you're right; this is not listed on Clinical Trials, but the protocol is really abiding with what the FDA wanted. So patients should have received and progressed on or did not tolerate standard chemotherapy, which, as you know, platinum based, [energy based], 5-FU.
And in addition, if they have a mutation that is addressable, like BRAF, they have to receive it. If they are eligible for checkpoint inhibitors, they should have receive it or not tolerate it. And on this end, they could enrol in this study. So we may have patients who have received regorafenib and/or Lonsurf or not. So it's not a requirement. But we anticipate that some patient, and in fact, would have received them in this study.

Stephen Willey

Okay. And then maybe just to follow up on the 20% four-month PFS rate that's required to gain the enrolment of stage 2. I guess when you look -- I think it was what the SUNLIGHT study that was just published, I think they saw a six-month PFS with Avastin and Lonsurf of north of 40%, and then I think with Lonsurf alone close to 20%.
So I'm just trying to, I guess, maybe think about the threshold that you're establishing here in the context of some of the historical data that's out there.

Richard Ghalie

You're absolutely right about this. The reported -- the Phase 3 study, in fact, that was reported at ASCO GI came in when we were just launching this study. So just let me explain where the 20% threshold of came, but then also what it means for us going forward.
The 20% threshold was driven by the monotherapy kinase inhibitor, so the regorafenib Phase 3 study. And the our advisors, which is, as you may know, is the Academic GI Cancer Consortium, who was running that trial, said that they would like to see something upwards of maybe double of what we've seen with regorafenib alone in this patient population.
So that's where the 20% came. This is not our ceiling; this is the floor. We need to see at least something better than that to go to Phase 2, to the cohort 2.
A separate question that you're asking is if we just get 20% only, is this enough? Would we get excited knowing that Lonsurf and bev has a 40% PFS at months four to six. And you're right. I think the answer to that is going to be: it depends who we enrol.
If we enrol patients that failed Lonsurf or Lonsurf and bev or another TPI, that would get us excited will be very different than if we have patients who really failed prior chemo immunotherapy -- I'm sorry, prior chemotherapy with bev and then they come on that study.
So I'm not trying to dodge the answer. I'm trying to say it will be determined by the kind of patient we enrol. Not unlike what David mentioned about voruciclib. If we see response in voruciclib, a progression on voruciclib, there will be -- the excitement level will be very different if we see response on -- a patient who responds to venetoclax and then progress then went back on the combination responded.
So if it's primarily driven by the patients we enrol, as is often the case in Phase 1 studies. We enrol, we look at the data, we analyze, and we make solution based on what we see.

Stephen Willey

Okay. That's helpful. And then just, lastly, I guess when you look at the 4Q R&D number implied from what you reported year end, it looks to be demonstrably down sequentially, I think sub-$3 million. How should we think about that number just going forward? And is that somehow impacted by the Kyowa transaction, some true up there? Or is that just a true number per the quarterly report and that's just going to accelerate as you guys do more clinical development here? Thanks.

Jay File

Yeah. It's Jay. I'll take that. So yeah, you're correct in your assessment. We're not giving specific guidance as to R&D into the next fiscal year. But I will tell you: of that, about 52.5 of R&D, about 26 of that was specifically related to zandelisib.
We do know that that trial continues to wind down. We do expect that to run out at about October timeframe and probably not incur expenses any more than a million, less than that most likely. The Q4 activity is just seeing the continued wind-down of coastal and title in Q4.
And like I said, we expect that to go ahead and wind down. And then in addition to some of the other cost reductions that we've made throughout the second half of the year, overall, R&D, yeah, you're right. It will be down significantly from the prior year.

Stephen Willey

Okay. Thanks for taking questions.

Jay File

Sure.

David Urso

Thank you.

Operator

This concludes our question-and-answer session. I would like to turn the conference back over to David Urso for any closing remarks.

David Urso

Thank you for joining the call today, and we appreciate your participation.

Operator

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