FibroGen, Inc

Good day and thank you for standing by. Welcome to the FibreGen's first quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, please press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, David De La Chia, Vice President, Investor Relations.

Good afternoon, everyone. Thank you for joining today to discuss our first quarter 2024 financial and business results. I'm David De La Chia, Vice President of Corporate FP&A and Investor Relations at FibroGem. Joining me on today's call are Thayne Weddick, our Chief Executive Officer, Dr. Daya Adib, our Chief Medical Officer, Juan Graham, our Chief Financial Officer, Dr. John Hunter, our Chief Scientific Officer, and Chris Cheung, our Senior Vice President of China Operations. Following our prepared remarks, we will open the call to your questions. I would like to remind you that remarks made on today's call include forward-looking statements about FibroGem. Such statements may include, but are not limited to, our collaborations with AstraZeneca and Astellas, financial guidance, the initiation, enrollment, design, conduct, and results of clinical trials, our regulatory strategies and potential regulatory results, our research and development activities, commercial results and results of operations, risks related to our business, and certain other business matters. Each forward looking statement is subject to risks and uncertainties that could cause actual results and events to differ materially from those projected in that statement. A more complete description of these and other material risks can be found in Fibrogen's filings with the SEC, including our most recent Form 10-K and Form 10-Q. Fibrogen does not undertake any obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. The press release reporting our financial results and business update and a webcast of today's conference call can be found on the Investors section of Fibrogen's website at www.fibrogen.com. With that, I'd like to turn the call over to our CEO, Zane Weddick.

Thank you, Dave. Good afternoon, everyone, and welcome to our first quarter 2024 earnings call. On today's call, I will focus our stakeholders on the four strategic pillars shaping our company's future trajectory. Additionally, I'll offer insights into the progress of our Pemrevumab and Roxidustat programs. Dr. Daya Adeeb, our chief medical officer, will review the top line data from our CD46 targeted antibody drug conjugate FG3246 in metastatic castration resistant prostate cancer and articulate why we feel so strongly about our recently released phase one top line results. And Juan Graham, our CFO, will review the financials after which we will open the call for your questions. Starting on slide three, Fibrogen has four key strategic pillars that we believe offer significant value today. First is Pemrevumab, where we are preparing for readouts from two pivotal Phase III studies in pancreatic cancer. In the coming months, we plan on releasing top-line data from Precision Promise, Pancreatic Cancer Action Network's Phase II-III Adaptive Platform Trial for metastatic pancreatic cancer, and from our ongoing LAPIS Phase III trial in locally advanced pancreatic cancer. Pancreatic cancer is a disease with substantial unmet clinical need, and represents a significant commercial opportunity for Pamrevimab, which has demonstrated an effect in both preclinical and early clinical studies in pancreatic cancer, and which we will detail in a moment. Second is Roxidustat. Roxidustat is approved in over 40 countries, generates significant net revenue and positive cash flow, and provides fibrogen with material and growing economics through our partnerships with AstraZeneca and Astellas Pharma. We're expecting an approval decision from the China authorities in the second half of 2024 for chemotherapy-induced anemia, which, if approved, would represent meaningful revenue growth on top of the substantial revenue generated by roxidustat in anemia associated with chronic kidney disease. Fibrogen has regained the rights to roxidustat from AstraZeneca in the U.S. and ROW territories, excluding China and South Korea. This allows us the opportunity to potentially partner roxidustat in certain indications with high NMET needs such as anemia in patients with lower risk myodysplastic syndromes. Third is our early stage oncology pipeline. We are very excited about the potential of these programs. FG3246 is a first in class potent antibody drug conjugate or ADC targeting CD46 for the treatment of metastatic castration resistant prostate cancer and potentially other solid tumors. This program also includes the development of an associated CD46-targeted PET biomarker. In April, we released compelling data from our FG3246 Phase 1 monotherapy trial, which Daya will go into later on the call. In addition to FG3246, we have recently submitted an IND for FG3165, our anticolectin-9 monoclonal antibody, and await FDA clearance of the application. We are also planning to final an IND for FG3175, our anti-CCR8 monoclonal antibody, in 2025. The fourth pillar is our strong cash position. We finished the quarter with approximately $214.7 million in cash, cash equivalents, investments, and accounts receivable. We expect our strong balance sheet to be sufficient to fund our operating plans into 2026. In summary, we believe there are few biotechnology companies of our market cap that have such a compelling mix of commercial, late-stage, and early-stage assets. When you combine our assets, our strong balance sheet, and the quality of our talented colleagues at Fibrogen, we believe that we have a strong foundation to drive significant shareholder value creation today and into the future. Moving to slide five, Pamrevelmab is a novel anti-CTGF human monoclonal antibody in clinical development for the treatment of metastatic pancreatic cancer and locally advanced unresectable pancreatic cancer or LAPC. Pamrevimab has demonstrated dose and exposure related responses in an early stage pancreatic cancer trial and having been studied in over 1,000 patients across various conditions, a favorable safety and tolerability profile. I would now like to discuss the Pamrevimab opportunity in pancreatic cancer in more detail starting on slide six. Pancreatic cancer represents one of the largest unmet needs in oncology, with an annual incidence of nearly half a million patients across the major regions combined. This includes approximately 60,000 PDAC patients in the U.S. There is an overall five-year disease-free survival rate of only 12.5%. And for metastatic cancer, their survival rate is approximately 3%. Unfortunately, there have not been any major therapeutic advances for quite some time. On slide seven, we provide an overview as to why we believe Pamrevimab can provide benefits to patients diagnosed with pancreatic cancer. Based on preclinical data, connective tissue growth factor, or CTGF, plays an important role in the growth and progression of pancreatic tumors. Mouse pancreatic tumor studies have shown that Pamrevimab, by inhibiting the biological activity of CTGF, can have both direct anti-tumor effects and effects on the surrounding stroma, providing a strong clinical rationale for use in both locally advanced and metastatic pancreatic cancer. Moving to slide eight, we would like to reference the data from our open label dose escalation phase one, two trial in patients with locally advanced stage three or metastatic stage four pancreatic cancer. Almost 90% of these 75 patients were in fact metastatic, with only nine having locally advanced disease. Pamrevomab was evaluated in combination with gemcitabine and erlotinib as first-line therapy. An important observation in this study was that enhanced clinical benefit was observed at higher drug exposure levels. Once drug plasma levels reached a trough threshold of 150 micrograms per mL, a number of important results were found. The most notable result in this study was that one-year survival was 37% for patients who had circulating pamrevomab levels of 150 micrograms per mL or higher versus 11% for those with lower plasma levels. These results in the higher exposure cohort patients also included improved median overall survival and improved median progression-free survival. Moving to slide nine, in late January, we announced the completion of the Pamrevomab arm in precision promise. Pancreatic Cancer Action Network's phase two, three adaptive platform trial for metastatic pancreatic cancer, which evaluates Pamrevomab in combination with the chemotherapy treatments gemcitabine and nabpaclitaxel for patients with metastatic pancreatic ductal adenocarcinoma. The PRECISION PROMISE trial is a Phase II-III registrational study that is being executed at the top pancreatic cancer centers in the United States. The primary endpoint of the trial is overall survival. In this study, Pamrevomab is being evaluated in both first and second line metastatic disease. Slide 10 provides additional details on the precision promise study, which is comprised of two stages. In the initial stage of the study, or stage one, 100 patients with metastatic pancreatic cancer received Pamrevomab in combination with gemcitabine and nabpaclitaxel. Guided by Bayesian principles, the graduation threshold for Pamrevomab was a protocol pre-specified greater than or equal to 35% predictive probability of success for the primary endpoint of overall survival at the completion of the trial. The Pamrevimab arm successfully graduated to stage two in the third quarter of 2022, and an additional 75 patients were enrolled, receiving the same Pamrevimab treatment regimen as in stage one. All patients were dosed until disease progression, and the final analysis is based upon the data collected for all patients up to 12 months after the last patient initiated treatment. Including patients enrolled during the analysis period between stages one and two, a total of 213 patients participated in the Pamrevimab arm of the study. The Pamrevimab arm of the Precision Promise Trial was completed in late January of this year. Pamrevimab is the first experimental arm in the Precision Promise Trial to meet its pre-specified threshold for graduation to stage two. and we now expect to report top-line data in mid-2024, reflecting PanCan's updated timing to complete database lock and subsequent analysis of the top-line results by the Independent Statistical Monitoring Committee. On slide 11, we provide an overview of the Global Phase III Lapis Trial, a double-blind, placebo-controlled trial in 284 patients with locally advanced unresectable pancreatic cancer, comparing Pamrevilumab to placebo in combination with standard of care chemotherapy. The primary endpoint is overall survival. Given LAPAS is an event-driven trial, we continually monitor the number and trend of events to ensure we have the most up-to-date perspective on when the trial will accrue the required number of events and allow us to lock the database. Since our last update, the pace of events has decreased, which is a common occurrence in this type of oncology study. We now expect top line data from the LAPIS phase three study of Pamrevomab and locally advanced unresectable pancreatic cancer in the third quarter of 2024, reflecting the current number and trend of overall survival events. Moving to slide 12, we show a snapshot of the two Pamrevomab registrational studies which are being conducted in locally advanced and metastatic patients. These patients represent almost 90% of all diagnosed pancreatic cancer patients today, giving Pamrevomab the potential opportunity to treat a vast majority of patients across this devastating disease. One important difference between the two studies is the dosing regimen of the Precision Promise Study. Pamrevomab is dosed in 28-day treatment cycles until disease progression or discontinuation, which is distinct from lapis, in which pamrevomab was delivered in a neoadjuvant setting and where it was dosed for up to six months. We believe the ability to dose patients until disease progression in a metastatic setting provides a potential opportunity to amplify clinically meaningful increases in overall survival driven by those patients benefiting from Pemrevomab treatment. On slide 13, we reviewed the U.S. commercial opportunity for Pemrevomab in pancreatic cancer. There have been limited treatment advances over the last two decades in both locally advanced and metastatic diseases, with immuno-oncology therapies providing benefit to a small subset of metastatic patients. Using straightforward assumptions, the total addressable market for pancreatic cancer in the U.S. represents a multibillion-dollar opportunity for Pemrevumab if it can demonstrate a clinically meaningful improvement in overall survival in either locally advanced or metastatic patients. Even modest penetration in either of these segments represents a substantial commercial opportunity in the U.S. alone, where Fibrogen plans to commercialize on its own should Pemrevumab gain approval. In summary, penrevomab, if approved, could represent a meaningful advance in prolonging survival for patients with pancreatic cancer and a game-changing opportunity for fibrinogen. We expect top-line results in the near term. Moving now to slide 15, roxidustat for anemia of chronic kidney disease continues to perform extremely well in China. First quarter total roxidustat net sales in China by fibrinogen and the distribution entity jointly owned by Fibrogen and AstraZeneca was $79.4 million, compared to $64.1 million in the first quarter of 2023, an increase of 24%. This growth was driven by an increase in volume of 39%. Fibrogen's portion of ROXADU-STAT net product revenue in China was $30.5 million for the first quarter on a U.S. GAAP basis, compared to $24.2 million in the first quarter of 2023, an increase of 26%. Moving to slide 16, Roxadustat continues to expand its category leadership and brand value share in China, rising to 47% in the most recent three-month period, ending in February of 2024. The potential addition of the chemotherapy-induced anemia indication would provide an important new treatment alternative for patients with chemotherapy-induced anemia and be a meaningful addition to the Roxadustat business in China. Given that there have been several generic applications filed in China, I would like to reiterate the dynamics of the generic market more broadly in China and the exclusivity of Roxadustat. The impact of a generic approval and launch in China is meaningfully different than in the U.S. market. Generic players face lead time and execution risk of market adoption after approval, as they need to be admitted into hospital formularies, one listing at a time. Originator products do not experience a meaningful deterioration in revenue until at least four generic products are approved. Even then, originator products in China have historically been able to maintain a stream of net revenues and profits after generics enter the market. Despite the expiration of our composition of matter patents in June 2024, we do not expect meaningful deterioration of the ROXADUSTAT business in the near term. In addition to the continued outstanding performance of ROXADUSTAT in China, ROXADUSTAT penetration in Europe continues to increase, showing strong quarter-over-quarter growth. We expect this growth to continue given the fact that ROXADUSTAT is now fully reimbursed in all EU5 countries. Roxidustat is the only HIF-PHI indicated in the EU for the treatment of anemia of CKD in both non-dialysis and dialysis patients. And with GSK's decision to withdraw the MAA for Daprodustat, Roxidustat maintains its strong competitive position in the EU. Of note, we have recently been successful in defending Roxidustat's patent portfolio and now believe Roxidustat has exclusivity into 2036. positioning it to continue its growth and HIF market leadership over the next decade in the EU. Moving to slide 17, earlier in the year, we announced that AstraZeneca returned all U.S. ROW rights for Roxazustat to Fibrogen with the exception of South Korea. Fibrogen's collaboration agreement with AstraZeneca for Roxazustat in China remains in place. Regaining the rights to Roxazustat in the U.S., allows us to pursue Roxadustat development opportunities with potential partners in indications such as anemia associated with lower risk myodysplastic syndrome. On slide 18, we highlight the potential opportunity for Roxadustat in patients with anemia associated with lower risk MDS. There is a well-defined patient population and a clear clinical need given the current therapeutic alternatives, which translates into a significant commercial opportunity. We continue outreach to potential interested parties. Moving on to slide 19, late last year, we presented data from the phase three Matterhorn study of Roxadustat in patients of anemia of lower risk myodysplastic syndrome at the American Society of Hematology annual meeting. Although we missed the primary endpoint of transfusion independence, driven by a high placebo response in patients with low transfusion burden at baseline, roxidustat demonstrated a numerical advantage relative to placebo. When looking specifically at results in patients with a higher transfusion burden at baseline, there was a statistically significant and clinically meaningful advantage in transfusion independence in patients treated with roxidustat versus placebo. Based on these results, we continue to believe that roxidustat represents an important potential therapy for patients in the U.S. and other territories where it has not yet been approved. Lastly, in April, we announced compelling top line results from our phase one monotherapy study of FG3246 in patients with metastatic castration-resistant prostate cancer. Before I hand it over to Daya Adeeb, our new CMO, I would like to highlight the deep clinical development experience that Daya brings to Fibrigen. He has over 28 years of biopharma drug development experience, including multiple global product submissions, approvals, and launches. Most importantly, Daya advances our capabilities in both pancreatic cancer and prostate cancer, given his prior experiences, and we are fortunate to have him leading the clinical development team. Daya, over to you.