Chimerix Q1 2024 Earnings Call Transcript

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May 1, 2024

There are 12 speakers on the call.

Operator

Good morning, ladies and gentlemen, and welcome to the Chimerix First Quarter 2024 Earnings Conference Call. I would now like to introduce you to your host for today's call, Will O'Connor of Stern Investor Relations. Please proceed.

Speaker 1

Thank you, operator. Good morning, everyone, and welcome to the Chimerix Q1 2024 Financial and Operating Results Conference Call. This morning, we issued a press release related to our Q1 operating update. You can access the press release in our Investors section of the website. With me on today's call are President and Chief Executive Officer, Mike Endriole Chief Medical Officer, Alan Melamed Chief Operating and Commercial Officer, Tom Riga Chief Financial Officer, Michelle Laspaluto and Chief Technology Officer, Josh Allen.

Speaker 1

Before we begin, I'd like to remind you that the statements made on today's today's call will include forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and 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 a more complete disclosure of these risks and uncertainties. At this time, I'll now turn the call over to Chimerix President and Chief Executive Officer, Mike Andriole.

Speaker 2

Thanks, Will, and good morning, everyone, and thank you for joining us. I'm pleased to be joined this morning by other members of our senior leadership team to share an update on a productive quarter across several key initiatives. A primary strategic importance to Chimerix this year is the continued focus and drive of enrollment in the Phase 3 action study towards the team continued to execute at a high level during the Q1. The study remains on track for 1st interim readout next year and is reaching steady state accrual. The success of the action study, which is the most advanced trial in H3K27M mutant glioma is central to our strategy as a positive outcome likely represents approval of the 1st medicine to treat this specific disease.

Speaker 2

As the organization drives action enrollment, we are keenly aware of the significant unmet need for patients with this disease as there are no approved treatment options available that have proven a clinical benefit beyond radiation therapy in H3K27M mutant glioma. As a result, our team is continuously evaluating registration pathways globally to accelerate commercial access to dordavapron also known as ONC201 where possible. As we undertake this effort, we are also aware that having a pivotal Phase 3 study well underway is an important consideration in global regulatory conversations that contemplate accelerated approval and the ongoing maturation of action enrollment enable such discussions. To that end, I want to share a set of experience that have been complementary to our strategy and underscore the magnitude of the unmet need we see every day with this lethal disease. Late last year, I received a communication from the Australian Minister of Health inquiring about dordabapron for patients in need within his country.

Speaker 2

During this interaction, the topic of provisional approval in Australia was raised, which is similar to the accelerated approval pathway in the United States. This interaction was the catalyst to our recent pre submission meeting in Australia with the Therapeutic Goods That pathway is That pathway is a 3 step process, which begins with a pre submission evaluation of the current data set in recurrent disease as well as other program features including the status of pivotal studies. We're pleased with the outcome from this meeting and intend to advance to rivaparone to the 2nd step in the process, the provisional determination application. I'll let Alan provide more details on the process going forward. To be clear, we recognize that dorabaprone remains early in the provisional registration process.

Speaker 2

However, we are sharing the outcome of this meeting now as we are encouraged by TGA's review of the program to date and their conclusion that the Phase 2 data set does potentially meet their criteria for provisional approval. This along with the status of the Phase 3 action study supports advancement in the provisional registration process. This example is emblematic of our overall strategy to accelerate global access to doridabapone and we're eager to partner with the TGA in Australia to further advance dorabaparone towards potential provisional registration. Turning to our 2nd generation imipridone ONC-two zero six. We have increasing confidence in the safety profile, therapeutic window and potential for novel and differentiated indications from the parent compound, dordavapron.

Speaker 2

Phase 1 safety studies are not yet complete, we are nevertheless preparing development strategies for this program that we expect to share before the end of the year as we near a Phase 2 investment decision. I'll let Josh frame this process further as we look into the second half of twenty twenty four. Finally, financially, the company remains on strong footing and we continue to execute with financial discipline. Michelle will provide a full summary of our financial performance in the Q1 and insights into cash runway. I'll now turn the call over to Alan to discuss the process and path we're undertaking in Australia.

Speaker 2

Alan?

Speaker 3

Thanks Mike and good morning everyone. As Mike mentioned, our development strategy is to accelerate access to dabbagrofen as quickly as possible for patients in need around the world. We expect that the vast majority of countries will require positive results of our Phase III action study as this is designed to provide a definitive assessment of safety and efficacy in a randomized trial in the frontline setting of H3K27M mutant diffuse glioma. That being said, as action enrollment advances, we are exploring options for early approval in the recurrent setting where regulatory pathway is allowed. The recent interaction with the TJ in Australia was very supportive of moving to the next step in the provisional registration process based on 3 attributes.

Speaker 3

1, a high unmet need in HCK27M mutant glioma 2, the encouraging Phase data in the recurrent setting and additional supportive data and 3, our current progress in the ACTUEN study. We find the outcome of this meaningful validating to the program and complementary to our broader strategy. The unmet need here is undeniable and the potential of being this promising treatment of the patient sooner is inspiring to me as a pediatric oncologist. We will work collaboratively with the TGA as her dapical and advance into the next step in the process over the coming months. Once the provisional determination application is submitted, the review process is expected to last about a month.

Speaker 3

If successful, an application for provisional registration will be submitted and that review process will take approximately 1 year. We expect the filing could be submitted by the end of 2024 with potential commercial availability in 2026. Our organization is preparing NDA submission in parallel to the execution of the action study to ensure readiness for early stopping scenarios at upcoming interim efficacy analyses. The potential to submit to TJ is complementary to the regulatory work already in progress. Tom will have much more to say about the specific commercial opportunity and plans as those timelines and activities come into focus later this year.

Speaker 3

With that, I'll turn the call over to Josh Allen to discuss ARG206. Josh?

Speaker 4

Thank you, Alan, and good morning, everyone. In addition to dordavapron, we are also excited about our earlier stage programs. Regarding Phase 1 evaluation of ONCT206, dose escalation remains on track to report preliminary safety and pharmacokinetic findings this summer. As a reminder, the compound is being evaluated in pediatric and adult patients with advanced CNS tumors. Dose escalation on a once per week basis with doses ranging from 50 to 3 50 milligrams has completed without limiting safety signals and is now being evaluated on an intensified dose schedule of twice per day for 3 consecutive days per week.

Speaker 4

This intensified dose schedule was selected based on observations that the majority of advanced cancer model maximize their response to ONC-two zero six at or prior to this duration of exposure. While dose escalation studies are inherently adaptive with variable timelines, we remain on track to report preliminary safety and exposure data this summer at dose levels anticipated to be within the therapeutic range. Ensuring that a potential new treatment is present at therapeutic concentration for an adequate amount of time, while being adequately safe in humans is the primary aim of Phase 1 evaluations. Establishing this is critical prior to the next step in clinical development, which will be aimed at efficacy evaluation in carefully selected patient population. Non clinical investigations continue in parallel to Phase 1 to identify and prioritize opportunities for future clinical efficacy evaluation.

Speaker 4

These include tumors that occur both within and outside of the central nervous system that do not harbor the H3K27M mutation, but do rely on disease drivers that are directly addressed by the therapeutic mechanism of ONC-two zero six. We are leveraging the dordapopro clinical experience as well as the vast knowledge of the multidimensional mechanism of our compounds that impact critical aspects of tumor biology. These include reversal of epigenetic disease drivers, degradation of specific oncogenic proteins and inactivation of the central pro survival signaling pathways. We are delighted that some of these concepts are showing promise in the lab and we look forward to providing more details in the context of a Phase 2 investment decision financial results.

Speaker 5

Thank you, Josh. Earlier today, we issued a press release containing our financial results for the Q1 of 2024. Chimeraus' balance sheet at March 31, 2024 included $188,200,000 of capital available to fund operations and no outstanding debt. We remain highly disciplined in the financial management of the company. Our rolling 4 quarter burn rate of $58,000,000 at the end of Q1 twenty capital efficient Phase 3 companies in our peer group.

Speaker 5

Our approach is to retain strong discipline and gate investment as we evaluate commercial models in the different territories. We continue to expect our cash balance to be sufficient to support operations into 4Q 2026. Turning to our results for the Q1 of 2024, the company reported a net loss of $21,900,000 or $0.25 per basic and diluted share compared to a net loss of $21,400,000 or $0.24 per basic and diluted share in the Q1 of 2023. Research and development expenses of $18,800,000 were flat compared to the same period in 2023. General and administrative expenses decreased to $5,500,000 for the Q1 of 2024 compared to $5,700,000 for the same period in 2023.

Speaker 5

With that, I will now turn the call back over to Mike for closing remarks.

Speaker 2

Thanks, Michelle. In closing, our primary strategic importance for Chimerix this year is the continued focus and drive of enrollment in the Phase 3 action study for which the team continues to execute at a high level. Additionally, we continue to explore pathways which may accelerate access to dordavapone for patients with this ultra rare and lethal disease. More broadly, we're excited about the profile of ONK-two zero six that is potentially emerging and look forward to reporting preliminary safety and PK data later this summer. At Chimerix, we're devoted to filling gaps in the treatment paradigm in oncology.

Speaker 2

Despite advances in the field of genetically defined tumors, there remains a significant unmet need, particularly in neuro oncology and we're focused on bringing potential new medicines to these patients in need. I'd like to take this opportunity to thank our dedicated team at Chimerix as well as the doctors, patients, patient advocates and caregivers for their unwavering commitment as we move closer to bringing life altering new medicines to the patients we serve. With that, John, we'll open the call to questions.

Operator

Thank

Speaker 6

I was going to start off with just enrollment for the Phase 3. Seeing that you added 5 additional sites since your Q4 update, does that include some of the higher volume ex U. S. Sites and geographies? And can you provide perspective on whether you're seeing a meaningful change in the enrollment event rates in the study or do you think you'll require more sites to further optimize enrollment?

Speaker 2

Hi, Maury. It's Mike. Appreciate the question. The additional 5 sites that have been added recently were sort of part of the initial tranche of sites. So not including the additional sites that we talked about last quarter.

Speaker 2

And that's probably going to be less than 10 in any event. It's really strategic for markets where we're seeing patients travel great distances. So those aren't necessary to achieve our enrollment projections and we continue to expect 1st interim OS in 2025.

Speaker 6

Got it. Okay. That's helpful. And then, for getting your filing application submitted to the Australia TGA, Got a couple of questions there. I guess, what are the gating factors for the application and submission?

Speaker 6

When and how often do you plan on meeting with the TGA prior to the filing? And what do you anticipate the TGA will want to see as it relates to progress in the Phase 3 action study? Is it just the status of Phase 3 enrollment? Or do you expect the approval will be contingent on the interim OS data that you get in 2025?

Speaker 2

Yes. Great question, Maury. Yes. So in terms of what's needed for the application, our ongoing interactions, look, the next step in the process is a preliminary determination application. We'll initiate that here over the summer and then they'll evaluate that assuming that we move to the final step in the process.

Speaker 2

The provisional application will new drug application. So the overlap between the work we're already doing within the company for creating that document and the submission in Australia. As Alan alluded to earlier, there's a lot of overlap between those two things. In terms of progress and enrollment, their key consideration is making sure that they'll have definitive safety and efficacy data during the provisional registration period. I think they've already seen enough to feel comfortable with that.

Speaker 2

And so continued trajectory on the trajectory we're on is, I think assumed and of course, we expect there is going to be additional tailwinds to that, which we've already talked about. Other parts of your question that I missed? There are several.

Speaker 6

Yes. Just how often you plan on meeting with TGA prior to filing and when those meetings could take place and will you provide updates to the public after those meetings?

Speaker 2

Yes. Certainly, there's ongoing collaborative interactions with TGA, particularly as we move through this next second phase of the process, the preliminary determination application. And then we expect to meet with some degree of frequency heading into the 3rd step in the process assuming that we get that far. So Alan, I don't know if there's any additional regulatory interactions that you would comment there, but I think that covers it.

Speaker 3

And the only thing I'll add, this is Alan, is that the submission is not contingent on the Phase 3 trial data. It's to ensure that the trial is well underway at the time of approval for them to make a decision.

Speaker 6

Got it. Understood. Okay. Thanks for taking my questions. I'll hop back in

Speaker 7

the

Operator

queue. The next question comes from the line of Noorin Quibria from Capital One. Please go ahead.

Speaker 8

Hi, good morning. Congrats on the progress and thanks for taking my questions. I guess sort of following up on what Maury just asked regarding the well, sort of on the accelerated approval in Australia, the potential for that. Just curious what the commercial opportunity might be in Australia? And also, if you could talk a bit more about other territory that you might be considering along the same lines?

Speaker 2

Yes. So thanks, Noreen for the call or for the in Australia. So look, in terms of other countries, we're focused on the action study first and foremost, as I mentioned, is our key strategic priority. We are evaluating a handful of other countries that have a pathway. As you can imagine, strategically, the timeline of when you could potentially submit there is an important variable as we think about that because we're just around the corner from potential first interim on the action study next year.

Speaker 2

So if we intend to evaluate or pursue a pathway that we're evaluating, we'll update the market at that time. Tom, comments on commercial potential on Oscar

Speaker 9

proposition of submission here by the end of the year. And along with that process and it runs in sequence and potentially in parallel is a process with the Australian regulators for pricing access and reimbursement, the HTA process. So that market is more analogous to those in Southern Europe and very much different than U. S. Prices are lower.

Speaker 9

But as we have studied this particular market, there is some room for optimism when we evaluate the criteria for how those evaluations are the criteria for how those

Speaker 7

evaluations are conducted and we see attributes of

Speaker 9

ONC201 that could be potentially very interesting from a commercial perspective. I think those issues are 1, 1st in class product in an area of high unmet medical need. I think second is ultra rare disease. And third, and I think of significant importance is that there is not an anchor product that's currently approved to treat this area of illness. So early, but we do see some optimism from a commercial standpoint.

Speaker 9

I think that coupled with the high unaided awareness that exists in country today within our action sites along with the efficient network that exists in the neuro oncology community in Australia could make for a very lean and efficient commercial model. We do not foresee significant investment from a human capital perspective on behalf of Chimerix. We will be looking for in country collaborations and we'll have much more to say about that as we progress in the process.

Speaker 8

Got it. That's helpful. Thank you. I guess one more from me on ANG206 the dose escalation trials. I know you're not commenting on what stage is that, but let's say in terms of both the trials, are they moving at the same pace?

Speaker 8

For instance, if you have adult data and the pediatric is incomplete, will you still report data from one trial if the other is incomplete in that timeframe?

Speaker 2

Thanks, Noreen. Josh, would you like to answer that?

Speaker 4

Yes. Thanks for the question, Noreen. I mean both trials and adult and pediatrics are proceeding in parallel. There's some nuances in the exact design and kind of how they play out in different ways. But at the end of the day, I think what you can expect to see on the next quarter is us provide an update on key safety and pharmacokinetic information from both of the studies.

Speaker 4

I think across the different dose levels and cohorts, etcetera, I think we would expect to have an experience that's around 75 patients. It's going to be a little pediatric skewed, I'd say about 2 thirds of that aggregate population just because the pediatric trial has enrolled in a couple of settings in contrast to the adult study. So you can expect to see safety and PK information represented from both trials.

Speaker 8

Okay, terrific. Thanks. Thanks for taking my question.

Operator

The next question comes from the line of Soumit Roy from Jones Research. Please go ahead.

Speaker 10

Good morning, everyone, and congratulations again on progress on every front. A quick question on with the approval of Davonstorafenib, is there any overlap between H3K27 and BDAF alteration? Or are you expecting any change in enrollment pace across both for 206 or 201?

Speaker 2

Great question, Shumit, and contemporary one. I'll ask Josh to comment on that specifically. But before I do, I just want to pause and congratulate day 1 on that approval. It's a meaningful milestone for the field of neuro oncology. I think by our account, that's the 3rd genetically defined approval in the field in the last several years and after a girth of innovation over the last quarter century that's a really significant milestone and quite meaningful for pediatric patients with low grade glioma.

Speaker 2

So congratulations to that team and we're excited for the field. Josh, do you want to talk about the overlap between H3K27M and BRAF?

Speaker 10

Yes. Thanks, Mike. And I think well said

Speaker 4

to the congratulations for day 1. Yes, I think first and foremost, the thing to point out is that H3P27M doesn't really co occur with other actionable mutations, and that includes the BRAF fusions in B600E population. So these are populations of patients that really don't overlap. The final thing I would point out, Shnev, is just that in the unlikely event that you do have a patient that has co occurrence, I would just highlight that the accelerated approval for toberafenib was in the relapsed or recurrent setting and our Phase III trial is focused in the frontline setting. So again, co occurrence would be exceedingly rare based on the available evidence.

Speaker 4

If there are, there's actually an opportunity to sequence therapy following the action.

Speaker 10

The other thing is, I don't know if you can provide any color as you are expanding globally. Is the percent H3K10 mutation is still according to your initial market survey of 8% to 9% to 10% or is it changing depending on U. S. Versus ex U. S?

Speaker 10

And the second one is, are you seeing in ex U. S. Territories any difference in prior treatment or how patients are being handled? Last time you mentioned ex U. S.

Speaker 10

Patients have more temozolomide usage. Anything else you are seeing that could affect the action expected results?

Speaker 2

Yes. Thanks, Sumit, for the question. I'll take the first one on just the ex U. S. Percent of the mutation.

Speaker 2

And I'll ask Alan to talk about what we're seeing in terms of different standards of care, if any, broadly speaking geographically. On your first one, Shumit, the percentage with H3K27M in terms of incidents, we have no reason to conclude that it's different country to country or within different races. In fact, our proportion of enrollment relative to where we have sites is almost uniform globally and it's kind of consistent with that conclusion. So no reason to expect any geographic differences in terms of the mutation. Alan, would you like to comment on the standards of care?

Speaker 3

Thank you for the question, Sumit. In general, the standard of care worldwide is still radiation therapy for these patients. There's a slight difference that you may see in the U. S. Some patients are receiving proton beam radiation, but as a whole, it's still radiation as the mainstay.

Speaker 3

There are some patients who are receiving temozolomide, this is typically more in the adult setting. Pediatric patients globally do not, but there is a little higher incidence of prior tinosolomide even in the pediatric patients globally.

Speaker 10

Thank you and congratulations again.

Operator

The next question comes from the line of Joel Beatty from Baird. Please go ahead.

Speaker 10

Hi, this is Ben Paluch

Speaker 7

on for Jobe. Thanks for taking the question. On the future development path of ONC-two zero six, would it be possible to give us a sense of what's being contemplated? Is that a monotherapy? Is that a combination therapy potentially with tumor treating fields?

Speaker 7

Or is that maybe non CNS solid tumors?

Speaker 2

Thanks, Ben, for the question. Josh, would you like to comment?

Speaker 4

Sure. Thanks for the question. I mean, I think the short answer to the question is prioritization is given to opportunities for monotherapy development. At least initially, the focus is on solid tumors that don't harbor the H3K27M mutation. And the opportunities are inclusive of, but not restricted to CNS tumors.

Speaker 4

So I wouldn't pigeonhole this drug to the specific combination that you just mentioned there. I'll highlight there's in line with this, if you're looking for more specificity, right, there's several positive in vivo studies with monotherapy ONC-two zero six in histologically defined indications that are published and summarized in our corporate deck. Those examples include GBM medulloblastoma, uterine cancer, breast cancer and certain kinds of neuroendocrine tumors such as paraganglioma. I mentioned in my prepared remarks some of the specific mechanistic considerations that we're using to guide some of these monotherapy activity potentials and how we identify and prioritize them. And really, the goal of that is to further refine those opportunities for indications that are either defined by or enriched for specific biomarkers of OX206 that we think could represent meaningful opportunities for clinical development.

Speaker 7

Great. Thank you.

Operator

The last question comes from the line of Troy Langford from TD Cavan. Please go ahead.

Speaker 11

Hi, congrats on the progress and thanks for taking our question. So just with respect to the next steps for ONC-two zero six, do you believe any of these future studies for the program could constitute pivotal studies in the selected patient populations? Or do you think you all are more likely to do smaller single arm Phase 2 studies first followed by a larger controlled Phase 3 study similar to what you did with dorabaparum?

Speaker 2

Sure. Thanks for the question. I'll let Josh speak to that. I think in short, it may well depend on the direction of the program and the indication pursued. But Josh, would you like to comment further?

Speaker 4

That's exactly right. Our goal in the near term is going to be to make sure that the drug is able to get into humans at adequate therapeutic concentrations for an adequate amount of time and be well tolerated. We think if we can achieve that and update everyone on this

Speaker 7

in the middle of the year, that that's going to be sufficient to open up a lot

Speaker 4

of additional opportunities for further development. And totality of the exact nature of that sort of registration opportunity, like Mike said, the trial design, what the exact next steps are and the exact endpoints are, are very much something that we're thinking about right now and are tailored to the specific opportunity. But obviously, we're going to be focused on identifying clear monotherapy signals and the most efficient path to approval possible for that disease if we see confirmation of that activity.

Speaker 11

Great. Thanks for all the extra color.

Operator

As there are no further questions at the queue at this time, I would like to turn the call over back to Mike Andrille.

Speaker 2

Thanks, John. Thank you everyone for your time this morning and we look forward to updating you in the coming months.

Operator

This concludes today's conference call. Thank you for your participation. You may now disconnect.

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