Aptose Biosciences, Inc.

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Good day, and thank you for standing by. Welcome to the Aptos Biosciences, Inc. reports results for the second quarter of 2022. At this time, all participants are in a listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during that session, you'll need to press star one one on your phone. Please be advised that today's conference is being recorded, and I would now like to hand the conference over to Ms. Susan Pietropalo, Ms. Pietropoulos, please go ahead.

Thank you, Chris. Good afternoon and welcome to the Aptos Biosciences Conference call to discuss financial and operational results for the second quarter ended June 30, 2022. Earlier today, Aptos issued a press release relating to these financial results. The news release as well as related SEC filings are accessible on Aptos' website. Joining me on today's call are Dr. William G. Rice, Chairman, President, and CEO, Dr. Rafael Behar, Senior Vice President, Chief Medical Officer, and Mr. Fletcher Payne, Senior Vice President and Chief Financial Officer. Before we proceed, I would like to remind everyone that certain statements made during this call will include forward-looking statements within the meaning of U.S. and Canadian securities laws. Forward-looking statements reflect Aptos' current expectations regarding future events, but are not guarantees of performance, and it is possible that actual results and performance could differ materially from these stated expectations. They involve known and unknown risks, uncertainties, and assumptions that may cause actual results, performance, and achievements to differ materially from those expressed. To learn more about these risks and uncertainties, please read the risk factors set forth in Aptos' most recent annual report on Form 10-K and SEC and CEDAR filings. All forward-looking statements made during this call speak only as of the date they are made. Aptos undertakes no obligation to revise or update the statements to reflect events or circumstances after the date of this call, except as required by law. I will now turn the call over to Dr. Rice, Chairman, President, and CEO of Aptos Biosciences. Dr. Rice?

Thank you, Susan. I want to welcome everyone to our call for the second quarter ended June 30th, 2022. At Aptos, we are developing two distinct clinical stage oral kinase inhibitors, and we are focusing our cash and human capital toward the activities that can generate the greatest value in the shortest period of time while building an experienced team and extending our cash runway into 2024. I also want to emphasize that our trials now are accruing patients rapidly, in fact, ahead of anticipated schedules, and we've experienced no significant clinical challenges during the past quarter. Our most advanced drug candidate, HM43239, or 239 as we refer to it, is a clinically de-risked myeloid kinase inhibitor for the treatment of patients with relapsed or refractory acute myeloid leukemia, or AML, and 239 continues to excite us, our KOLs, our clinical investigators, and the patients participating in our clinical trial. 239 is a selective kinase inhibitor that suppresses a handful of clinically validated kinases critical to the survival of AML cells, including the SICK kinase, all forms of the FLT3 kinase, the JAK1 and JAK2 kinases, and the mutant forms of the CKIT kinase. By the time these relapsed or refracted AML patients reach our trial, each patient harbors a mix of adverse mutations. not just a single mutation. And each suffers with disease that is highly resistant to therapy, having already been failed by other lines of therapy, including approved chemotherapy, targeted therapies, combination therapy, investigational therapies, and hematopoietic stem cell transplants. Plus, these are physically compromised patients by their advanced disease and their prior failed therapies. That's why it's so impressive that 239 has demonstrated its capacity to be powerful enough to deliver complete remissions, also referred to as complete responses or CRs, in a wide range of these heavily diseased AML patients. Yet, 239 is mild enough on the normal cells to be safe and well tolerated in a physically compromised population. It's these impressive clinical responses across the very sick and diverse AML populations that have earned orphan drug designation and fast-track status for 239 from the FDA. To date, 239 has delivered complete remissions in AML patients with highly refractory disease having complex karyotypes and adverse mutations in high-profile genes, including NPM1, MLL, IDH, TP53, RAS, RUNX1, DNMT3A, and others, but with wild-type FLT3 status. It also includes relapsed or refractory AML patients having mutated FLT3. that have been failed by prior therapy with approved FLT3 inhibitors, such as giltritinib and monostorin. And this is a population in desperate need of new and effective therapies and a potential population for accelerated approval. Our ongoing phase 1-2 dose escalation and dose exploration trial has treated more than 50 patients to date. A near-term value is being created by increased awareness of the broad and impressive clinical activity and response rates from this ongoing trial. This trial already has delivered safety and efficacy data that allowed us to select our doses and our genetically defined patient populations for the next stage of clinical development, which involves dose expansion trials planned to begin in the second half of this year that are designed to confirm activity and specific populations and then segue into phase two registrational studies to support accelerated approval. The target profile and proven breadth of activity of 239 advocate for this agent to address sizable markets that include several rather than just one genotypically defined AML populations. This includes two AML target populations for potential single agent accelerated approval. First, the FLT3 mutated patients that have been failed by prior therapy with FLT3 inhibitors. And second, the TP53 mutated patients. On a more traditional development path, we plan for additional AML target populations to expand the market through combination therapy studies and investigator-initiated studies, including the broader FLT3 mutated population, the NPM1 mutated and MLL rearrangement population, and the RUNX1, DNMT3A, and RAS mutated mixed populations. Plus, the paradoxical powerful efficacy and mild safety profile of 239 supports potential use as the agent of choice for combination therapy and for use in MRD positive maintenance therapy. And while we and others believe the annual U.S. market potential may exceed $1 billion, I will leave it to the analysts to calculate their own composite commercial market potential for these genetically defined patient populations of AML patients. It's gratifying to see the continued progress with additional complete remissions during the first half of this year, to see the breadth of complete remissions in patients with highly adverse mutations where other agents already have failed, to see all the newer patients going on study recently, and to see how these findings guide our path toward registration studies and suggest ample commercial opportunities through multiple AML target populations. And our Chief Medical Officer, Dr. Behar, will expand on these concepts in a few moments when he provides our clinical overview of 239th. But now let me move on to our second molecule, Luxeptinib. Lux, as we call it, is an oral kinase inhibitor that inhibits BTK, FLT3, and other important kinases. Lux is in two separate Phase 1AB dose escalation trials for the treatment of patients with B-cell leukemias and lymphomas and for patients with AML. And anti-tumor activity already has been demonstrated with the original formulation in heavily pretreated cancer patients. In fact, we continue to observe signs of clinical activity with the original LUX formulation. And recently, two relapsed B-cell cancer patients still on study at the 900 milligram BID level have observed 35% or more tumor volume reductions thus far. As you know, we've also been exploring an improved formulation, which we call G3. And we've rapidly accrued patients who received one of four different dosage levels of the G3 formulation. which may deliver higher plasma exposure levels with reduced dosages and could lead to dose optimization studies in the coming months. In a few moments, Dr. Behar will provide further details from the LUX trials. And now my final point, but certainly not my least. Let me welcome our new Chief Financial Officer, Mr. Fletcher Payne, to his first Aptos quarterly call. A highly accomplished CFO, Fletcher joined our team a month ago. and he brings extensive experience in corporate finance, strategy, and operations specific to the biotech industry. More recently, Fletcher served as CFO of SIAPS, where he completed several financing transactions and oversaw accounting, finance, corporate development, and legal functions. I won't go through his entire background here. You can refer to the press release on his announcement. But suffice to say, we're delighted to have him join our executive management team, and I've heard congratulations from many of you. I'm pleased to introduce Fletcher, who will start today's call by bringing you up to date on our financial status. Fletcher.

Thanks, Bill. Good afternoon, all. I'm delighted to be working with the Aptos team and to help advance 239 and Lux. I'm pleased to have already met some of you and look forward to working with you. Let's review the second quarter financials. As most of you know, from following Aptos, we take a frugal and disciplined approach to cash management and direct our cash to the highest impact activities. Last quarter, we reported that our cash runway extended into the fourth quarter of 2023. Continuation of our financial discipline has allowed us to further extend the current cash into 2024 without compromising our assets. So let's review our cash position. We ended June 30, 2022, with approximately $62.4 million in cash, cash equivalents, and investments. That is a decrease of $7.1 million as compared to March 31st of 2022. During the quarter, the net loss was approximately $10.6 million, translating into approximately 11 cents per share loss and down from $13.5 million loss from the comparable period in 2021. During the six months ended June 30th, the net loss was approximately $22 million, translating into approximately 24 cents per share loss, and down from $29.7 million loss from the comparable period in 2021. As identified in the income statement, we had no revenues during the second quarter of 2022. Research and development expenses were approximately $7.3 million for the quarter, down from $9.8 million during the same quarter of 2021. Research and development for the six-month period ended June 30, 2022, were $14.7 million as compared to $18 million for the comparative period, a decrease of $3.3 million. The decrease was due to lower LUX manufacturing costs as a result of the G3 formulation, which requires less API, and to lower clinical trial costs. G&A expenses were $3.3 million for the quarter, down from $3.7 million in the same quarter of 2021. G&A expenses for the six-month period into June 30, 2022, were $7.4 million, as compared with $11.7 million for the comparative period, a decrease of approximately $4.2 million. The decrease was primarily due to a reduction in stock-based compensation during the first half of 2022 relative to 2021. Before I turn it over to Dr. Behar for a clinical update, some of you asked me about the letter from NASDAQ noting that the company's closing stock price bid was below the minimum $1 per share for 30 consecutive days. ACTO stock continues to trade uninterrupted. As many of you know, the company has 180 days to regain compliance with the NASDAQ minimum bid price requirement. NASDAQ considered these matters closed when the stock closes at or above $1 for a minimum of 10 consecutive business days at any time during the 180-day period. If the company does not regain compliance within that 180-day period, we still may be eligible to receive an additional 180-day period. Our strategy to drive higher stock price levels is to increase awareness of the 239 asset and its clinical data and to advance both 239 and LUX programs through key clinical achievements. We believe it's too early to contemplate implementing any other specific actions to address this topic. With that, let's have Dr. Behar give us a brief commentary on 239 and LUX. Raf?

Thanks, Fletcher. It's great to have you on board. APTUS has two very distinct, well-differentiated oral kinase inhibitors for the treatment of hematologic malignancies, ATEM43239 for AML and lexeptinib for both AML and B-cell cancers. Let's start with 239, our lead acid, which is a clinically validated myeloid kinase inhibitor that in our ongoing Phase I-II clinical trial has already safely delivered complete remissions for AML patients with a multiplicity of adverse mutations. While 239 is much more than a FLIT3 inhibitor, it does inhibit all forms of FLIT3, So let's look at it in the context of competitor FLT3 inhibitors. In preclinical studies, 239 consistently demonstrated superior antitumor activity relative to Giltoridinib, a FLT3 inhibitor currently used to treat AML patients with FLT3 mutations. We believe that 239 may be best in class, superior as a single agent, and when combined with venetoclaxirase acetidine. While we have begun to better understand the breadth of activity of 239, a clear clinical pathway for development has evolved. 239 is positioned to be a superior competitor, FLT3 inhibitor, because of its kinase inhibitory profile and its ability to kill AML cells resistant to competitor FLT3 inhibitors by interfering with the rescue pathways that lead to that resistance. At the same time, 239 avoids targets that may compromise safety. During the second quarter, the FDA granted fast-track designation to 239 for the treatment of patients with relapsed or refractory acute myeloid leukemia with FLT3 mutations. It has previously received orphan drug designation from the FDA for treatment of acute myeloid leukemia in 2018. In this patient population, patients who already have been failed by other FLUT3 inhibitors, current analyses show that we have achieved a response rate of 43% among patients treated with 80 milligrams or greater. Most of these responses emerged at the 80 milligram dose level, the dosage at which we have treated 20 patients. More recently, we placed additional patients on the 120 and 160 milligram dose level. Although they are early in their course of treatment, we will watch for responses in these patients at the higher dose levels. In addition, we've begun treating patients at the 40 milligram dose level to identify the lower limit of doses that can deliver responses. While this 43% response rate number will evolve as we dose additional patients, it demonstrates important activity in a patient population with tremendous unmet medical need. To give you some context on the significance of this response rate, those of you who participated in our KOL event in June heard Dr. Novel-Dauber and Dr. Brian Jonas, investigators in our trial, as well as many others, say that it is very challenging to get a complete remission with a single agent in a relapsed refractory AML patient population. It's not a common event in that even response rates in the teens and 20s can be extremely meaningful. This highlights how important it is to compare apples to apples when comparing response rates to other agents from other studies. In fact, Dr. Diver pointed to giltaritin, the gold standard of care, as having an initial single-agent CR rate in relapsed refractory AML patients of about 15%, even though most had not been previously treated with FLT3 inhibitors. So 239's response rate in our even more highly relapsed population is quite impressive. One explanation for this activity is that 239 is more than a FLT3 inhibitor and has the potential to serve as a multidrug therapy in one tablet by concurrently suppressing multiple proliferation and resistance-confirming pathways in AML, serving as a sick inhibitor, a JAK1-2 inhibitor, a mutated CKID inhibitor, and indeed, it's likely to be the additional inhibitory activities that contributed to the significant response rate in the FLT3 mutant patients that have failed prior FLT3 treatment. What I also want to highlight about the responding patients is the diversity of mutations in patients that we've had in the study with complete responses. They include patients that have had FLT3 mutations, both FLT3 ITD and FLT3 TKD, and those that have been previously treated with other tyrosine kinase inhibitors that target FLT3, including mitostaurin and or gilceridinib. But importantly, we've seen complete remission in patients that have very adverse mutations in the FLT3 mutated group. These included mutations in NRAS, KRAS, and BTPN11, as well as mutations in ROX1 and MLL-PTD. Some of these mutations are typically associated with resistance to tyrosine kinase inhibitors, yet they continue to be sensitive to 239. Importantly, we've also seen activity in patients who do not carry a FLT3 mutation. The three wild-type patients, in particular, one patient that had a very adverse genotype a TP53 mutation, along with highly complex cytogenetics and a very prolonged remission. As Brian Drucker commented at our KOL event, I can't remember ever seeing a patient get to a CR with a single agent with a TP53 mutation. Other patients with wild-type FLIT3 that experienced complete remissions by 239 had mutations in IDH2, NRAS, and various mutations in chromatin and splicing factors. Again, this reinforces that principle that 239 is more than a FLT3 inhibitor and likely can treat the patient populations identified earlier by Dr. Rice. Now let's talk briefly about the safety of 239. Since our last update, we have not had any drug-related severe adverse events, no drug-related deaths, and we have not observed any dose-limiting effects that have affected other tyrosine kinase inhibitors. In particular, we have not seen adverse events related to elevated creatinine kinase, and we have not seen adverse events related to QT prolongation. and we've seen actually no relationship between the change in QTC and dose. Importantly, we've not had any dose-limiting toxicities up to and through the 160-milligram dose level. While we do have one dose-limiting toxicity of muscle weakness at the 200-milligram dose level, it was not due to muscle breakdown, otherwise known as rhabdomyolysis. We believe we've identified a safe therapeutic range with a broad therapeutic window spanning the dose levels of 80, 120, and 160 milligrams. which are the doses that we will take forward in our expansion study planned to begin in the second half of this year. We've selected 120 milligrams as our primary single-agent expansion dose, with 80 milligrams and 160 milligrams as bracketing doses that we can adjust to in order to refine our dose selection if necessary. We plan to explore this dose in FLT3 mutant patients who have been failed by prior FLT3 inhibitors as supported by a FAST-REC designation and significant response rate to date. These patients have a great unmet medical need and no approved off-the-shelf options. The ability to rescue these patients and perhaps send them to transplant, as we have now done, would allow us a quicker path to registration. We will also include relapsed and refractory AML patients with unmutated FLT3 that have other adverse mutations in genes such as TP53. We will explore safety and activity in these patients with 239 treatment, both as a single agent and in combination with venetoclax, identifying meaningful activity in other prognostically adverse subgroups that could lead to other options for accelerated approval. While we better define the single-agent activity of 239, we will simultaneously explore treatment in combination with venetoclax. This will help us understand how best to use 239 as a treatment partner in earlier lines of therapy. We will be conducting these expansion trials starting the second half of this year and throughout 2023, leading to registrational trials anticipated to begin as soon as we collect sufficient data in these subpopulations that could trigger an accelerated development path. These clinical plans are outlined in our July corporate presentation available on the website. Okay, now on to a quick review of LUX. Just a reminder, LUX is the only known clinical agent that potently inhibits both FLT3 and BTK with a precision that avoids known targets that are often associated with toxicities. It is being tested in a Phase I A-B trial in patients with relapsed or refractory B-cell malignancies who have failed or were intolerant to standard therapies and in a separate Phase I A-B trial in patients with relapsed or refractory AML or high-risk myoblastic syndromes. Clinically, the drug has thus far demonstrated clear target engagement of BTK and SLID3, as well as important anti-tumor activity in both AML and various B-cell malignancies. However, using the original formulation, it has not been absorbed well enough to achieve levels that consistently and effectively treat these aggressive cancers. As we have mentioned prior, we've made significant progress with our new formulation of LUX, which we call G3, that may enable greater exposures across patients. As an example, on a per milligram basis, at the two-hour time point, 50 milligrams of G3 developed approximately 200 times the exposure rate relative to 150 milligram dose of G1 in a comparator patient. I'm pleased to report that we have dosed G3 at four different dose levels, safely completing dosing of G3 in 13 patients up through the 200 milligram dose level. After patients receive the single G3 dose, samples are collected for PK evaluation, and then patients go on to the original formulation of LUX for a direct comparison. Modeling the expected PK exposures with G3, if administered continuously, is ongoing and will inform the protocol amendments necessary to permit continuous G3 dosing for all patients. If the modeling data are compelling, we plan to submit the data in our new dosing plan to the FDA, likely later in this year, with a plan to transition our clinical trials away from the G1 formulation toward continuous dosing and dose escalation of the G3 formulation. This represents a significant action because transition to G3 formulation may allow us to deliver higher plasma exposure levels at reduced doses to patients with hematologic malignancies. In addition to potentially delivering higher exposures that may result in greater responses, we expect that G3 formulation may reduce significantly the pill burden, the amount of drug substance administered to patients, and thereby the amounts and costs of drug substance and drug product manufactured to support the trials. We are pleased with the progress in our LUX and 239 clinical programs, and we look forward to keeping you updated For more information on all of our ongoing clinical trials and clinical sites that are recruiting patients, please visit clinicaltrials.gov. So now, please, let me turn it back to you, Dr. Rice.

Thanks, Ralph. Ralph mentioned the KOL event that we held in June, and if you have not yet heard the perspective of these respected leaders in hematology, you really should do so. You can access the webcast or transcript on our website. As we open the calls for questions, please feel free to pose a question to any of us. And operator, if you could, please introduce the first question.

Yes, doctor. As a reminder, to ask a question, you'll need to press star one one on your phone. Please stand by while we compile the Q&A roster.

One moment, please.

Our first question will come from Matthew Begler of Oppenheimer. Your line is open.

Oh, hey, guys. Thanks for taking our questions. Congrats on the progress. Maybe just start off with one for Dr. Bayar on 239. I think you may have kind of alluded to this in terms of its multi-kinase potential, but something that struck us as unique in the patients that got responses were the depth of responses. Specifically, it looks like there's more complete remissions than CRs with incomplete count recovery like CRP or CRI. How do you guys go about explaining that?

Raf, you may be on mute there.

No, I heard.

Sorry, I was delayed. Thanks for the question. I think death response is extremely important. I think patients who have a CR and are likely to do better, likely to do better, likely to do better, And it demonstrates that the drug is not overly myelosuppressive. If you want to be able to treat patients for a long time, having a drug that's severely myelosuppressive can be limiting because those patients may still require transfusions or other things. So the ability to achieve an unqualified CR, I think, is an important milestone. It's also one that's recognized as the FDA as a potential surrogate marker for overall survival that is approvable in accelerated approval studies. So we were happy to see that in patients who were on the drug for a substantial amount of time, they actually had maturation of their responses. If they didn't have a complete response at the beginning, they saw evolution to CR over time. And we think that that's going to be very key. You may be familiar with this disease, this state called morphologic leukemia-free state, which is really just clearance of blast without any count recovery. And the outcomes, unfortunately, with that See, with that type of response, if that's the only response that patients have, it isn't quite as good. So seeing this more complete response, I think it's an important factor. I'm glad you keyed it on.

Gotcha. Okay. So that makes sense. That was a good explanation. Maybe just a quick one on LUXM and the reformulation to G3 before I'll hop back in the queue. But do we know yet what a restart of the NHL trial would look like? Have you decided if you're going to also be concomitantly taking it forward in AML as you did before? Is this specifically going to be a B-cell asset going forward? And do you think you're going to need to redo the traditional 3 plus 3 dose escalation, or might you be able to get away with some sort of accelerated titration going forward? Thanks.

So, Ref, I'll take this one. So we haven't made any final decisions yet until we get all of the full data set on the G3 pharmacokinetics. Those data are coming in. We're presenting them to the PK modeling specialist. We hope then in the coming weeks or next couple of months to be able to get data back to guide us as to which direction we may or may not be able to go. Should we be able to use either once or twice daily dosing, continuous dosing, and hopefully be able to achieve that four to five micromolar level? If the modeling suggests that, then we'll try to move it forward, and we'll look at all the patient data at that time, whether it's in B cells or in AML. But on the other hand, if it doesn't show that, we'll have to make different decisions as to how we'd want to move forward. But the plan is to then, if it does look like we should be able to achieve those dose levels, we would request the FDA then allow us to go in at a higher dose level. likely just under the exposures that we are currently achieving with the G1, the original formulation, and try to implement continuous dosing there. But again, at an exposure level just below where we are now, ensure that we see safety and then continue to dose escalate. So we would not see the necessity to start over. So that would be our plan. But again, all that requires the thoughts from the FDA. Okay, hope that answered your question. Thanks, Matt.

Absolutely. Thanks, guys.

Thank you.

One moment, please, for the next question. And our next question shall come from Lee Wasik of Kantor. Your line is open.

Hey, guys. Thanks for taking my question. I guess first one on 239's ongoing trial, I wonder if you can give us an update on, I guess, how long the follow-up is right now, I guess, for the two higher doses, that's 120 and 160. And also you mentioned that enrollment has increased since June. I thought that was sort of interesting. So I wonder, was it mostly driven by the data that you put out in June? And then just wondering when you're planning to the next data update.

Okay, so I have to admit I couldn't understand all of the verbiage there. It was a bit muted, so I'll apologize for that. So perhaps you can paraphrase quickly.

Yeah, sure. So the first question is on the follow-up. How long is the follow-up for the two higher doses right now? And also you mentioned the enrollment has increased since June. So I just wonder, was it just driven by the data you put out? and then when are you guiding to the next data update?

All right, so I can start on those. So the link to follow up, so what I did mention is we've literally had a kind of a wave of patients coming on the study into the 120 and the 160 milligram level. Now, as Dr. Behar also mentioned, we're beginning at the 40 milligram level, so we can explore lower there. Many of these patients have just been on the trial for a short amount of time, So they are early in their treatment. And so we don't really have any data that we can present on those patients right now. As soon as we do, we will come out and provide those. We're going to have a number of opportunities, whether it be banking conferences, earnings calls, or conferences over the next couple of months. So we definitely want to be able to get that information out to you as those data emerge. Now, in terms of patient accrual, why did it increase? We believe a lot of it was based on when we presented the KOL event to have these luminaries in the field describing how diseased these patients are. They failed everything. They come on and they get a single molecule and the patients get a complete remission out of that, especially when they talk about a TP53 mutated patient. You just don't see that. So we believe that that impacted not only possibly investors, analysts, but also the investigators as well as patients that are seeing this. So we've seen a lot of excitement from the investigators on our clinical trials as well as the patients. When they start seeing the CRs come about, they really want to be on their drug. Perhaps Dr. Behar can add to that. And you're on mute.

It seems he is. Oh, there he is. Sorry, I made it back. No, Bill, I was going to say I totally agree. I think that the investigators have been very engaged with the study and very engaged with the data that we've been producing about the responses. We're also expanding the number of sites that we're putting on the study in anticipation of expanding to a greater number of slots and additional patients. So we're helping enrollment both by getting greater engagement and also by getting greater numbers of sites that are going to be on board. Yes, thank you, Russ.

Okay, great. So I guess the second question is, well, it seems like you're exploring the lower dose of 40 mg. So I just wonder, like, maybe you can comment a little bit on the rationale there. Was it driven by any discussion with FDA or maybe potential combination considerations there?

Dr. Bayhart can answer this. Yeah, that's an excellent question. So it was not something that was directly driven by the FDA. It's something that's driven in part by recent guidance that the FDA has put out, where it really does demand that companies do a better job of dose exploration during phase one studies. Because we had an accelerated dose escalation process, we only had a single patient on at 40 milligrams. And that patient had an exposure that looked a lot like the exposure that we saw at the average of the 80 milligram cohort. So we're left with a question of how different is 40 versus 80 in terms of patient exposure? And might we need to explore that more fully in order to better justify the doses that we're carrying forward into our expansion? So since we have a period of time here between the opening of these expansion studies and the ongoing study where we'll continue to explore the doses, we figured we would take that time to put a few patients on at 40 milligrams to better understand the PK there and perhaps the activity that we see just to ensure that we're actually fully exploring those dose levels that the FDA might come back and ask us to redo later when it might cost us more time. Yeah.

What a great point. There was no direct interaction or question from the FDA on that. It's just trying to follow the guidance, particularly that they've given other companies to recently.

Thank you so much.

Thank you, Lee.

Thank you. One moment for our next question, please. Our next question comes from Edward Tentoff of Piper Sandler. Your line is open.

Great. Thank you very much for taking my question. I have a couple, too, just to kind of clarify. So, firstly, with respect to the 43% response rate that you're discussing, is that new or is that what you presented at the event on June 2nd? Because I'm trying to figure out what the denominator is.

So, Dr. Behar, do you want to take that from the seven patients? Oops, I'm not sure he can hear again. So, that is related to the seven patients that we had that were FLT3 mutated and who had failed previous FLT3 inhibitors. And there were three patients that had some level of response, two were CRs, one was a PR. And that's, those are the data that have derived that response rate. We've been asked repeatedly, to provide the numbers, and so we've done that, okay?

Okay, cool, because I saw that you, the four CRs and the two CRIs and the one PR, so it's really the three out of seven in the split three mutant, right? Yes.

Yes.

So, second question, I missed what Ross was saying. He was breaking up just a little bit about escalating to 200 MIG. Is that still ongoing or no? And to follow up on the last question, will you be showing more of this dose exploration data later this year, recognizing that the new expansion cohorts won't be generating data yet?

So I can take the second part. Dr. Behar, did you want to address the first part?

Sure. The first part about reaching the 200 milligrams? Yes.

Yeah, I missed what you said.

So we have treated patients at the 200 milligram dose level. It's a dose level where we did encounter dose-limiting toxicity. And we've instead focused on the lower dose levels in the dose exploration. We do have the ability to treat patients at the 200 milligram dose level. It's a dose level where we did encounter dose-limiting toxicity. And we've instead focused on the lower dose levels in the dose exploration. We do have the ability to go back and further explore the 200 milligram dose level if needed. But having seen activity at 2.5 times lower dose levels than 200, we felt that there may not be any advantage to exploring that higher dose level. There may not be any advantage to exploring that higher dose level. And instead, we could focus our efforts on the exploration and then moving on to the expansion.

And Raf, could you disclose that DLT?

Did I what? I'm sorry? Yes.

Disclose what the DLT was. Sorry.

Yes. The DLT was described as muscle weakness, both upper and lower limb weakness. And I added the qualifier there that it wasn't muscle breakdown. It wasn't rhabdomyolysis. Instead, it had a phenotype that looked more like myasthenia gravis, where there's less neurotransmission.

Gotcha. And then with respect to the data from the first one,

Yes, so I can take that one. So from the patients that have been placed on recently, again, they are early in their disease or early in their treatment. So as those data begin to evolve, we will present that throughout the remainder of this year. And then we do plan to continue placing patient on there, possibly additional 120, 160, and 40. And as we go through the second half of this year, we do plan on presenting those additional data throughout the year. So we're not going to, we do not plan on waiting until the end of the year, if that's your question.

Okay, perfect. And then one last one, just with respect to the expansion arms that you kind of showed on the event, arm one, flip three mutant, arm two, flip three wild type. How many patients are you anticipating in those single agent groups? And then how many do you envision dosing with venetococcs? Thank you so much.

Dr. Behar? Yep, I can take that. So we're just submitting an amendment now that we'll get feedback from the FDA from where we're proposing to treat venetococcs. smaller numbers of patients in each subset. So even though we have an arm that's FLT3 mutant, where one subgroup will be FLT3 mutant patients that have received prior FLT3 inhibitor therapy. So that'll be a subset. Then it'll be FLT3 mutant patients that may have not received prior FLT3 therapy. Then there'll be a subgroup in the single agent arm that will have a TB53 mutation and one that won't. It'll be, you know, a handful of patients in each of these cohorts, so it will add up to a pretty substantial number. Roughly speaking, the ratio of patients in the single-agent arm compared to the patients in the combination arm will be about two to one, so it will be twice as many patients in the single-agent arm.

Great. Okay, excellent. Thank you so much.

Thanks, Ted.

Thank you. One moment, please, for our next question. Our next question shall come from Somit Roy of Jones Trading. Your line is open.

Hi, everyone, and thank you for taking the question. Could you explain us how the patients are getting assigned to the different dose level, like 40, 60, 80? Or in other words, do you foresee any bias towards possibly lower disease burden patients getting into 40 milligram dose cohort or... Any color would be appreciated.

Dr. Behar, do you want to address that? Yeah.

I can take that. One of the other advantages of looking at 40 milligrams is that we will have some patients in the combination arm where we'll have to pull back the dose to begin with anyway. So we'll have a little bit better understanding of the dose levels that bracket that. So that will be one potential option. I'm not sure that we're going to necessarily base it on the disease burden that the patients have. But it could matter on where they are in the course of their treatment. So we mentioned the possibility of treating patients in other contexts besides relapsed refractory disease, perhaps both earlier lines of therapy and combination, but also perhaps in a maintenance setting where the dose may not necessarily need to be the same. So having a better understanding of 40 will help us understand what we can achieve with lower dose levels if need be.

But you don't expect our investigators to put more frailer patients or patients with higher mutational burden to go towards this lower dose cohort just to get a TKPD, or you don't see any bias that could arise?

Oh, I see what you're saying. No, I don't necessarily anticipate that. I think when they see that a patient's appropriate for the study in general, they're likely to put them on. I don't know that they're necessarily biasing the choice of patient based on the dose level that's available to them at the time.

And we haven't seen additional toxicities associated with the higher levels between the 80s and the 160s. Thank you, I guess.

The second question is, I guess the natural progression course of treatment would be if patients turn into TR, they would get into hematobiotic stem cell transplantation. And so that would sort of obfuscate the durability of response coming directly just from 239. Have you discussed with the FDA like how primary endpoint would potentially look like, or that for a later time you would bring up if CR response rate could be an approval point or would have to be a median OS? Because most patients who were going to CR would be pushed into a stem cell transplant.

Yeah, I think we have seen a lot of stem cell transplants in our patient population, but I don't know that's always necessarily the case. I mean, we have a bias in our early sites for large academic medical centers where they have a tremendous transplant experience and capability. I don't know that as we expand it to more and more sites that the majority of CR patients will go to transplant necessarily. Many of them might be older and not necessarily eligible for transplant themselves. But that said, I think the FDA absolutely recognizes that getting a patient, especially with relapsed refractory disease, into a transplant is a laudable clinical goal and is considered a win from a clinical standpoint. So while they do require for accelerated approval that patients not only achieve remission, but that they have a durable or meaningful remission, I think that the FDA will work with companies to help count patients who may have had a short time on drug before they go to transplant and consider the combination of the drug and the transplant to be part of the therapy. A recent example of that was the cruzartinib frontline study where many of the patients went to transplant and And the entire arc of their exposure, including the transplant process, is counted in the assessment there. Thank you again for taking the question. Thank you, Sherman.

Thank you. And again, to ask a question, you'll need to press star 1-1 on your phone.

One moment for our next question. And we have a question from Joshua Cesaro of Kennecourt Genuity. Your line is open. Mr. Cesaro, your line may be muted.

Hi, can you guys hear me?

Yes, sir.

Yes. Yeah, hi, this is actually John Newman from Kennecourt. Just had a follow-up question on the expansion cohorts for 239. I think, Raphael, I heard you say that you'll be looking at 80 milligrams and 120 milligrams. Not sure if you'll be looking at a higher dose for the FLT3-mutated patients as well as the TP53-mutated patients. And then I also wondered if the approach in terms of stem cell transplant after a complete response would be any different for those cohorts, if you would just continue to leave that up to the investigators, or if you would perhaps recruit patients that would be less likely to be eligible for transplant? Just curious as to how you're thinking about that.

Yeah, both good questions. So just to clarify, the single-agent dose that we're going to carry forward in the expansion is 120 milligrams to start with. We have the ability to move that dose, and in fact, we'll include the ability to do intrapatient dose escalation, meaning if a patient isn't getting an appropriate response at 120 milligrams, they have the ability to move up, assuming that they've tolerated the 100 trillion milligram dose well. We have the 80 milligram dose available to us, of course, if there is toxicity and the patient needs to drop the dose for whatever reason, or if we see with more experience that that should be the appropriate starting dose, we'll be able to make that adjustment. As far as trying to specifically recruit patients that aren't eligible for transplant, the study is open to patients that are of any age, really, over 18, including patients that are unlikely to be good candidates for transplant. So if we do see a CR in those patient populations, we would assume that the patient wouldn't be transplanted. We don't have any efforts specifically to enrich for those patients in order to better understand duration. I think that we will leave it open and leave it up to the investigators as to who they put on the study. But I don't think they're specifically picking patients that are necessarily eligible for transplant.

Do you also want to mention about the dose that you plan to select for the combination studies with venetoclax?

Yes. So as I mentioned before, For the combination study, we're purposely planning to pull back the dose to one dose level below the 120 milligram, the 80 milligram dose level, in order to start with the combination of venetoclax. And that gives us a safety margin there, helps us understand the interaction between the two drugs and perhaps any toxicity that they might have together that we wouldn't have expected, and gives us a little bit more of a a safety margin. We will have the ability to adjust that as well if need be, both up and down. And again, having more experience at 40 will help us understand what we might expect if we went to a lower dose.

Great. Thanks.

Thanks, John.

Thank you. And that will end our Q&A session. I would now like to turn the conference back to Dr. Rice for closing remarks.

Well, everyone, thank you for joining us this afternoon. Although we still have a great deal of work ahead of us, we're gratified by the enthusiasm we've seen in the patients and the investigators, resulting in what I called earlier a wave of recent patient accruals onto our trials. And we're particularly pleased with the progress for our 239 clinical program. That momentum continues, and we look ahead to what promises to be a really exciting time for Aptos this year. We want to thank our clinical team, our investigators, our patients for their help in this important work. We just appreciate the support of our shareholders and analysts. And we look forward to keeping you updated on our progress. And we want to tell everyone thank you so much for being here today.

This concludes today's conference call. Welcome, sir. This concludes today's conference call. Thank you all for participating. You may now disconnect and have a pleasant day.

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