This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk10: Good day and thank you for standing by. Welcome to the AGIOS Pharmaceuticals Incorporated's Q3 2023 Earnings Conference Call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand is raised. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Mr. Chris Taylor, VP Investor Relations and Corporate Communications.
spk08: Please go ahead.
spk07: Thank you, Operator. Good morning, everyone, and welcome to AGO's third quarter 2023 conference call. You can access slides for today's call by going to the Investors section of our website, agios.com. On today's call, I am joined by our Chief Executive Officer, Brian Goff, Dr. Sarah Hewins, Chief Medical Officer and Head of Research and Development, Sveta Milanova, our Chief Commercial Officer, and Cecilia Jones, Chief Financial Officer. Before we get started, I would like to remind everyone that some of the statements we make on this call will include forward-looking statements. Actual events and results could differ materially from these expressed or implied by any forward-looking statements as a result of various risks, uncertainties, and other factors, including those set forth in our most recent filings with the SEC and any other future filings that we may make with the SEC. And with that, I'll turn the call over to Brian.
spk13: Thanks, Chris. Good morning, everyone, and thank you for joining us. Our vision for AGIOS is to build a leading hematology franchise with approvals spanning multiple indications, an expanded portfolio fueled by disciplined business development, and advancement of an internal pipeline aligned with our core expertise in rare disease. We're excited to speak with you today to review our progress thus far this year and highlight a number of important near-term clinical and regulatory milestones in the months ahead. Our momentum has been building and our accomplishments have been many, clinically, commercially, and in strategic business development. Most importantly, we've meaningfully advanced our pipeline through excellent execution and clinical development, generation of consistent and compelling clinical data, and investigators' enthusiasm for the potential of PK activation in our lead indications. In addition to the milestones achieved to date, I am pleased to announce that we have recently dosed the first patient in the phase three portion of the rise-up study of midipivet in sickle cell disease and completed enrollment of the phase three activate kids T study of midipivet in pediatric PK deficiency ahead of schedule. With this progress, we are on track to deliver six mid to late stage data readouts by the end of 2025, including three by the end of next year. and we remain well-positioned to generate significant value over both the near and long term. Sarah will provide a detailed update on her progress in R&D in just a few minutes. As you'll hear from Sveta, we remain encouraged that the durable efficacy observed in the clinical trials of midipivet in PK deficiency has continued to translate to a low discontinuation rate among patients in the real world. Importantly, we continue to maximize the current launch in PK deficiency while strengthening our commercial capabilities to support anticipated future launches in meaningfully larger patient populations, including a potential launch in thalassemia in 2025. As you'll hear from Cecilia, we ended the third quarter with approximately $872 million in cash and investments on the balance sheet. We are very pleased to have added a promising early-stage siRNA asset from L-nylin last quarter, and we continue to explore opportunities to expand and diversify our pipeline in a disciplined fashion. We're also keenly tracking Servier's progress toward FDA approval of boracitinib, given our retained economics. Looking at the path ahead, we are on track to achieve each of our remaining 2023 milestones and advanced priorities for next year. Specifically, we're focused on reporting top-line data from the Phase IIa study of AG946 in lower-risk MDS by year-end. And also, by the end of this year, we plan to file the IND for our pH stabilizer for the treatment of phenylketonuria, or PKU. Our other priorities moving into next year include preparing for two Phase III data readouts for energized and energized T in thalassemia next year, ramping enrollment in the phase three portion of the rise-up study of midiPIVAT in sickle cell disease, and completing enrollment in the phase three activate kid study of midiPIVAT in pediatric PK deficiency. Overall, I'm very pleased with the significant progress we've made in 2023, and I look forward to finishing the year strong. With that, I'll now turn the call over to Sarah.
spk03: Thanks, Brian. We have made tremendous progress advancing our industry-leading pipeline of PK activators so far this year, and I'd like to thank our research and development team for their dedication and relentless focus on improving patient lives. Reflecting this progress, we are very excited for the upcoming ASHE Annual Meeting in December and look forward to interacting with many stakeholders on our progress in PK deficiency, thalassemia, sickle cell disease, patient advocacy, and more. We anticipate sharing additional details of our ASH abstracts when they go live later this morning. As some of you may have noticed in the online program for ASH, for the first time, Congress organizers have dedicated an educational session to PK activation as a treatment for hereditary hemolytic anemias entitled, Energizing the Red Cell, Novel Therapy for Hereditary Hemolytic Anemias. The session will include presentations from leading KOLs on the therapeutic potential of PK activation in PK deficiency, sickle cell disease, and thalassemia. As leaders in PK activation, we were obviously thrilled to see this recognition. As Brian mentioned, we recently dosed the first patient in the Phase III portion of the RISE-UP study of metapivatin sickle cell disease, and the team is working diligently to bring sites on board. The importance of our efforts was reinforced just a couple weeks ago as Brian and I had the opportunity to participate in the Sickle Cell Disease Association of America National Convention in the D.C. area. We were able to further strengthen our connection with the sickle cell disease patient community by listening to the everyday challenges these patients face in their lives and reinforce Adjo's commitment through patient advocacy and clinical progress. Switching to our second PK activator, AG946. Given the accelerated enrollment of the Phase IIa study in lower-risk MDS, we expect to report top-line data from this study by the end of this year. As a reminder, MDS is a heterogeneous group of rare hematological malignancies characterized by ineffective erythropoiesis, commonly leading to anemia. Importantly, lower-risk MDS accounts for approximately 70% of MDS cases and shares core pathophysiological features with other hematological diseases in our pipeline. This phase 2A is a 16-week study in 20 patients, and the primary endpoints are hemoglobin response, defined as an average increase of at least 1.5 grams per deciliter from baseline from week 8 to week 16, and or transfusion independence, defined as remaining transfusion-free for at least eight consecutive weeks. The primary objective of these studies is to establish proof of concept for AG946 in participants with low-risk MDS and, through analysis of the results, determine if any protocol adjustments would be appropriate as we contemplate proceeding with Phase 2b. As Brian mentioned briefly, we are on track to achieve all of our remaining 2023 milestones. We expect to file the IMD for our phenylalanine hydroxylase, or pH stabilizer, to address the underlying cause of phenylketonuria, or PKU, by the end of the year. In our pediatric studies, enrollment in the Phase III Activate Kids T study of metapivatin children with PK deficiency who are regularly transfused is now complete, several months ahead of schedule. In the complementary study, the Phase III ACTIVATE KIDS study of metapivatin children with PK deficiency who are not regularly transfused, our team achieved our goal of enrolling at least half of the patients in the study by year end and is now focused on completing enrollment. Finally, the TEMPR-6 siRNA that we recently in-licensed from Alnylam has been integrated into our portfolio, and our team is excited to begin advancing that program as a potential disease-modifying treatment for polycythemia vera. Looking ahead to next year, we expect to report top-line results from the Phase III energized and energized T studies of metapivate in thalassemia. Together, these studies are evaluating metapivate across all thalassemia subtypes, including both alpha and beta thalassemia and patients encompassing the full range of transfusion burden. For Energize, our primary endpoint of hemoglobin response defined as an equal or more 1 gram per deciliter increase in average hemoglobin concentrations from week 12 through week 24 compared with baseline. For energized T, the primary endpoint is transfusion reduction response, defined as a 50% or greater reduction in transfused red blood cells units with a reduction of equal or more than two units of transfused red blood cells in any consecutive 12-week period through week 48 compared with baseline. The design of these trials allows us to demonstrate clinical meaningfulness in a variety of ways via hemoglobin increase supported by a reduction in fatigue and or transfusion reduction. Following the strong pace of enrollment, we expect data from the Energize study in the first half of next year and data from Energize T in the second half of next year. With that, I will now turn the call over to Sveta.
spk05: Thank you, Sarah. Our commercial organization remains focused on maximizing the opportunity of the current launch in PK deficiency, which will lay the foundation for potential future launches in thalassemia, sickle cell disease, and lower risk In the third quarter of 2023, we generated $7.4 million in net pyrokine revenue, a 10% increase over the prior quarter. A total of 160 patients have completed a prescription enrollment form, including 13 in the third quarter of 2023, a 9% increase versus the second quarter. This translated into net 100 patients on therapy at the end of Q3. We continue to observe PES conversion timeline in the range of four to six weeks. Patients on therapy continue to stem from a growing and diverse prescriber base of 142 physicians and represent a broad demographic and disease manifestation range that is consistent with the adult PK deficiency population. We continue to expect slow and steady uptake over time and variability quarter over quarter. This is due to the ultra rare nature of this disease and the long lead time between identifying a potential prescriber and then converting into a PEF and ultimately a patient on therapy. We remain focused on efficiently identifying providers likely to treat adult patients with PK deficiency and continue to be encouraged with the persistency of patient treatment. All of our work to build capabilities in targeting analytics, physician awareness and education, and patient access is helping to build a strong foundation to maximize the opportunity of potential future launches in meaningfully larger patient populations. The first of these anticipated launches is in thalassemia, where MitaPivot has the potential to become the first therapy to improve hemolytic anemia and ineffective erythropoiesis across the full range of disease subtypes, including alpha and beta thalassemia, and transfusion-dependent and non-transfusion-dependent thalassemia. Importantly, unmet need across thalassemia subtypes remains high. Approximately 60% of thalassemia patients in the US do not have an approved treatment option. As highlighted on this slide, in contrast to PK deficiency, the thalassemia market in the US is better established, with a higher diagnosed prevalence and higher disease awareness. PK deficiency is an ultra-rare disease, which includes approximately 3,000 patients with an estimated diagnosis rate of 30%. In contrast, thalassemia impacts approximately 8,000 patients in the US. The diagnosis rate for thalassemia is high, given the availability of targeted newborn screening. In addition, thalassemia has well-established ICD-10 codes. The availability of claims data in thalassemia will allow us to utilize the capabilities we're building today to inform our segmentation, targeting, and education efforts for launch. Analyzing this data, we have identified that approximately half of the adult thalassemia patients are treated at less than 150 affiliated hematology and oncology academic and community practices. Therefore, we plan to focus our initial launch efforts on thalassemia centers of excellence and these affiliated academic and community practices. As the launch progresses, we anticipate expanding to additional community practices with regularly monitored patients. With the potential future launches in thalassemia and sickle cell disease approaching, We are very excited by the prospect of expanding the range of patients we serve. And with that, I'll now turn the call over to Cecilia.
spk04: Thanks, Vera. A third quarter 2023 financial results can be found in the press release we issued this morning. And more detail will be included in our 10Q, which will be filed later today. Let me now take a moment to provide some context and highlight a few key points. Third quarter 2023 net pyroclan revenue was $7.4 million, an increase of $0.7 million compared to Q2 2023. Driven by the variability that Seta spoke to a moment ago, third quarter revenue was lower than we anticipated. Given the ultra rare nature of the disease and long lead times associated with initiating patients on therapy, we continue to expect slow and steady growth and quarter to quarter variability as we move forward. Consistent with other rare disease launches, growth to net is expected to be in the 10 to 20% range on an annual basis. Cost of sales for the quarter was $0.6 million. R&D expenses were $81.8 million for the third quarter, an increase of $16.9 million compared to the third quarter of 2022. This increase was primarily driven by the $17.5 million upfront payment to Alnylam for the 10.6 assets. SG&A expenses were $25.8 million for the third quarter, a decrease of $3.3 million compared to the third quarter of 2022. That was primarily driven by decreases in stock-based compensation expense and professional fees. As a reminder, as part of the divestiture of our oncology business to survey, we retain rights to a potential $200 million milestone upon FDA approval of oracidinib, and 15% royalties on potential U.S. net sales. We ended the quarter with cash, cash equivalents, and marketable securities of approximately $872.4 million. We expect that this balance, together with anticipated product revenue, interest income, and the potential Roroxidinib milestone, will enable the company to fund our operating expenses and capital expenditures through several value-creating milestones, and at least into 2026. This guidance does not include cash inflows from potential royalties from Boracay-Denez, commercializing MetaPivot outside of the U.S. through one or more partnerships, or other potential strategic business or financial agreements. We remain focused on creating shareholder value, including by proactively managing our cost base and deploying a disciplined cash allocation approach as we prepare to support potential future launches of PyroKind. As we move toward additional potential value creating milestones in the near term, I am confident that our strong balance sheet will enable us to execute from a position of strength as we continue to pursue ways to create shareholder value. I will now turn the call back over to Brian for his closing remarks.
spk13: Thanks, Cecilia. So far this year, we've made significant progress towards achieving our vision for Agios. And I look forward to the catalyst rich period ahead of us with readouts in three mid to late stage studies expected by the end of next year. As always, we'll continue to strive to be responsible stewards of our balance sheet and evaluate meaningful opportunities for value creation. Finally, I'd like to thank all of our employees for their hard work and dedication to our mission of transforming the lives of patients living with rare diseases and all of our partners, including the patients, physicians, caregivers, and participants in our clinical development programs. With that, we'll open the call for questions.
spk10: Thank you. As a reminder, to ask a question, you will need to press star 11 on your telephone. Please stand by while we compile the Q&A roster. Your first question comes from the line of Divya Rao from TD Cowan. Your line is now open.
spk02: Hey, guys. Thanks for taking my question. This is Divya on for Mark. Congrats on the quarter. Just in terms of the MDS readout, could you give us a little bit more color on the scope of that readout? And does the team have any, I guess, internal bar for what success looks like and what's needed, what you need to see before moving into the phase three portion?
spk13: Thanks, Divya. Sarah, you want to take that?
spk03: Sure. As we mentioned, so we have sped up the enrollment of this program, allowing us to create a readout this year, by the end of this year. And what you can expect is sort of consistent how we've handled top line data results in the past. So more to come on that. Obviously, full details will always guard for a medical meeting. So that would be in the works, too. In regards to your question For do we have a bar? Yes, we do have a bar Now this is a face to a so of course we're looking at this study to provide us learnings and as we've mentioned we will make sure that the data is Reviewed and that we set up face to be for maximum success and I just want to take an opportunity to acknowledge again that this is Sarah and her team delivering and
spk13: because this was originally something that we were expecting next year and it rolled a lot faster than we expected. So we're very much looking forward to the readout.
spk02: Thank you.
spk13: Sure.
spk10: Your next question comes from the line of Salveen Richter from Goldman Sachs. Your line is now open.
spk09: Hi, this is Lydia on for Salveen. Kind of going on to the last question, could you just lay out the opportunity for AG946 and how it fits within the broader pipeline and in the context of pyrokine?
spk13: Yeah, maybe I'll take that one. First of all, I think we're in a great position to have more than one PK activator. And for a number of reasons, IRA is actually one of them that gives us a lot of optionality. As you know, we're currently pursuing 946 in two different pathways. Sarah just talked about one, which is our pursuits of low-risk MDS, and we're very excited to have the opportunity to get the data readout. The other is we're pursuing 946 in sickle cell disease in a Phase I study, and the main intent there is to get data in another hemolytic anemia, and based on what that readout looks like at the right time, That'll guide us as to what else we would like to do with 946. But again, from an overall perspective, a franchise perspective, we have a lot of optionality and several different opportunities in front of us.
spk08: Please stand by.
spk10: Your next question is from the line of Tess Romero from JP Morgan. Your line is now open.
spk06: Good morning, guys. Thanks so much for taking our question. Can you give us a sense of the type of analyses we will get in the fuller presentation of Rise Up at a medical meeting later this year that are beyond what we saw in the top line? Thank you.
spk03: Sure, thanks, Des. So, as you can expect from us, as we always do for our data readouts, we will provide you with more detail on our secondary endpoints, because we did not provide that yet in the press release. So, you'll see more detail around hemolytic parameters, things like that, and then, of course, safety as well. For our usual approach, we stick to our intent to treat, so you will see exactly the primary and secondary endpoints the way we had described them in the protocol.
spk06: Okay, looking forward to Ash Abstracts in a little bit here, and thanks for taking our question.
spk13: We are too. Thanks, Tess.
spk10: Your next question comes from the lines Greg Renza from RBC Capital Markets. Your line is now open.
spk01: Hi, this is support on for Greg and congrats on the progress. I have a question on AG946. First, can you remind us, and you mentioned earlier that there's a heterogeneity in the low-risk MDS, but can you remind us the difference between patients with non-transfused or low burden of transfusion versus high burden of transfusion that we included in phase 2B and why the mechanism of 946, you know, could address both populations? And secondarily, I know there was a question from the bar for success earlier, but can I ask the question in a different way? I was wondering if we should look for those early data, you know, with 30% to 40% RBC transfusion independent as a bar, you know, for competitiveness. Thank you.
spk03: Thanks for the question. So these are, I'll start with the last. So you can't really compare trial to trial. They're not designed like head-to-head comparisons. They're different in the population enrolled. They're different in the duration of the trial. So I don't think you can just take a bar from another trial and apply it to the next. In regards to the population, so the first part is a short duration trial in which we chose to focus on a population that is less transfused so we can truly examine what happens there. And then the 2B is a longer trial in which we feel comfortable to enroll a higher burden, transfusion burden population. It's really just a numerical cutoff between all of those different populations and that's it.
spk08: Thank you. Yeah.
spk10: Our next question comes from the line of Greg Harrison of Bank of America. Your line is now open.
spk12: Hey, good morning. Thanks for taking the question. How are you thinking about the incremental commercial opportunity in pediatric PKD? How well are these patients characterized and what efforts remain on your end for identification? And would you expect a launch here to have a similar cadence to what you've seen in adults?
spk05: Hey, thanks for the question. Absolutely. So when you look at the PKD patient population in totality, we know we expect to have about 3,000 to 8,000 patients in the U.S. and EU5, so it's around 3,000 patients in the U.S. 80% of those are estimated to be the adult patient population, so it's about 20% of the pediatrics. Given the outer rare nature of the disease, we would expect a very similar launch dynamics. Having said that, we'll be on the market for a lot longer with a higher experience with pyrokine and understanding of the disease. So we'll be hoping to reach these patients as quickly as possible.
spk13: And Greg, I'll just add to that, in addition to the commercial opportunity that Sveta is talking about. We also think it's really important to have these studies conducted and completed in PKD because it gives a really nice signal of safety as we look ahead to these meaningfully larger opportunities that we talk about all the time, thalassemia, sickle cell disease. So that's the other dimension of this that I think for the community, the investigators, the patients who will be watching, we're very enthusiastic about getting those data readouts.
spk12: Thanks, that's helpful. Are you able to provide any additional color on discontinuations at this point in the launch? And if you can't quantify it now, is there any time in the future where we'd be able to expect that?
spk05: So as we've said in the past, we continue to make progress with the launch and learn every day. Given the ultra rare disease nature of TKD, We would expect to see slow and steady progress over time, but also variability quarter over quarter. I can tell you that very importantly, we continue to see strength in patient persistency. We get positive provider feedback and payer support for the product. So the discontinuation rates continue to remain low. We are dealing with small patient numbers, and that's why you might see some of the changes in the matrixes here.
spk03: And to add to that, the discontinuation in the clinical trial for, you know, also is low, and that allows us to really study maintenance of effect in the different open-label extensions that we have ongoing as well, and that remains encouraging.
spk12: Got it. Thanks again for taking the question. Thank you, Greg.
spk10: Your next question is from the line of Daniel Brill from Raymond James. Your line is open.
spk11: Hey, guys. This is Alex for Daniel. Another question on 946 ahead of MDS data. I'm just curious what your updated thoughts on how big you think the thrombocytopenia risk is of the toxicity signal. I know you're not using the same dose where it emerged, but it's kind of curious if there's anything particular about MDS that could make these patients more susceptible to that signal. Thanks so much.
spk03: Sure. Thanks for the question. So to start with the second part of your question, so thrombocytopenia is indeed more common in patients living with MDS because they can be prone to develop pancytopenias, which includes you know, a decrease in platelets as part of their disease. And indeed, many of the therapies have thrombocytopenia as an additional adverse event reported. To your point, we did observe thrombocytopenia at the high dose, you know, the 20 milligram dose in healthy volunteers. Right now, we are studying five milligrams in the MDS patient population, and we're working to really understand the safety profile and efficacy profile of the drug, so more to come on that after we have a database log.
spk13: And Sarah often adds the phrase that this is, it's monitorable, it's manageable, and it's reversible, which is very encouraging as well.
spk03: Indeed. That's the thing we hear really from physicians as well, because this is something that actually occurs within the organ system that they're very comfortable with, right? They're treating all of these hematological conditions. The fact that thrombocytopenia is something that can be picked up on lab draws and then mitigated by a potential discontinuation is a very reassuring thing.
spk08: Thank you.
spk10: Now I would like to turn the call back to Brian Goff for closing comments.
spk13: Well, thank you all very much for participating in today's call. As you heard this morning, our team has great conviction in our potential to deliver transformative new therapies for patients and significant long-term value for shareholders. And I'm really proud of the efforts, the continued efforts from our team. So we appreciate your interest in Agios and very much look forward to speaking with you soon. Thanks a lot.
spk10: This concludes today's conference call. Thank you all for participating. You may disconnect.
Disclaimer