Geron Corporation

Good afternoon. My name is Emma, and I will be your conference operator today. At this time, I would like to welcome everyone to the Geron Corporation's fourth quarter and full year 2022 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press the star one. Thank you. Erin Feingold, VP of Investor Relations and Corporate Communications. You may begin your conference.

Good afternoon, everyone. Welcome to the Geron Corporation Fourth Quarter and Year-End 2022 Earnings Conference Call. I am Erin Feingold, Geron's Vice President of Investor Relations and Corporate Communications. I'm joined today by the following members of Geron's management team. Dr. John Scarlett, Chairman and Chief Executive Officer. Olivia Bloom, Executive Vice President and Chief Financial Officer. Dr. Fay Feller, Executive Vice President and Chief Medical Officer. And Anil Kapoor, Executive Vice President of Corporate Strategy and Chief Commercial Officer. Before we begin, please note that during the course of this presentation and question and answer session, we will be making forward-looking statements regarding future events, performance, plans, expectations, and other projections, including those relating to the therapeutic potential and potential regulatory approval of Imatelstat, anticipated clinical and commercial events, and related timelines, the sufficiency of Geron's financial resources, and other statements that are not historical fact. Actual events or results could differ materially. Therefore, I refer you to the discussion under the heading Risk Factors in Jerron's Annual Report on Form 10-K for the year ended December 31, 2022, which identifies important factors that could cause actual results to differ materially from those contained in the forward-looking statements. Jerron undertakes no duty or obligation to update our forward-looking statements. Please refer to the press release and slide deck for today's call under events in the investors and media section of our website at www.geron.com slash investors for our fourth quarter and annual 2022 financial results, as well as business updates and expected upcoming key milestones. The agenda for today's conference call will be as follows. Chip will provide introductory remarks. Faye will highlight key data from the recent top line results from iMerge Phase 3 and provide a status update on our regulatory plans. She will also discuss our other ongoing development programs. Anil will discuss this year's planned commercial preparedness activities. Olivia will review fourth quarter and year-end 2022 financial results, financial guidance for 2023, and current capital resources. And Chip will provide concluding remarks before going to the Q&A session. With that, I will turn the call over to Chip. Chip?

Thanks, Erin. Good afternoon, everyone. Thanks for joining us today. With positive top-line results from eMERGE Phase 3 in hand, we now have a charted path towards several potentially significant regulatory and commercial catalysts, which we expect will further enhance the value of Imatel stats. Building on the momentum created by the lower risk MDS results, we are also advancing our pipeline to expand the potential applications from the Telstat and telomerase inhibition, which we envision will establish Geron as a leader in the treatment of hematologic malignancies. As a first step in the commercially attractive lower risk MDS indication, we remain on track to submit the NDA in mid 2023 and to complete the MAA submission in the second half of 2023. In parallel, we're preparing for potential U.S. commercial launch in the first half of 2024 and a potential EU launch by the end of 2024. We recently expanded our capabilities to support the potential commercialization of Immatelstat with the hiring of seasoned professionals with deep operational and launch experience. These individuals, who will serve on our growing senior commercial leadership team, include experts in trade and channel relations, market access, marketing, medical affairs, and sales. We believe that adding these colleagues to our already highly talented employee base provides the expertise and experience necessary to prepare for the anticipated commercial launch of the Mattelstat. A key differentiating quality of the Mattelstat and its novel telomerase inhibition mechanism of action is the potential to modify the course of the underlying hematologic malignancy. The compelling Phase III readout in lower-risk MDS has now added to our robust body of evidence of disease modification, and we believe our other clinical and research programs will further corroborate the potential meaningful clinical benefits with Imatelstat treatment. In our second Imatelstat Phase III trial, IMPACT-MF, a potential positive overall survival outcome could set the stage for changing the treatment landscape in myelopigrosis. Based on our current planning assumptions for enrollment and event rates, we expect an interim analysis for OS in IMPACT-MF in 2024. To further assess the potential of imetelcet and other hematologic malignancies, We're advancing development programs which evaluate Imatelstat in additional indications and in combination regimens. We expect significant readouts from these programs over the next several years. We have a strong balance sheet to fuel our regulatory, commercial, and Imatelstat development activities. On the heels of positive top-line results from our eMERGE Phase III study in low-risk MDS, we raised over $210 million in net proceeds from high-quality strategic investors in early January of this year. Combining our year-end cash balance with the net proceeds from the successful financing in January and the warrant exercise proceeds received in the first two months of this year, we accumulated total cash holdings in excess of $445 million. We believe that these capital resources will be sufficient to fund our projected operating requirements through the end of the third quarter of 2025, supporting the achievement of many of the value-accreting catalysts we're pursuing. In parallel with our continuing preparations to commercialize Imatelstat, we continue to consider relationships with potential partners, including exploration of regional and other deal structures of possible mutual interest, which could potentially maximize the value of Imatelstat for patients and Geron shareholders. In summary, the commercial preparedness and clinical development activities planned in 2023, as well as potential upcoming catalysts, are expected to position Geron to become a leader in the treatment of heme malignancies. Further, our strong financial position and highly capable employee base provides the foundation for Geron to become a fully integrated commercial biotech company over the next 15 months. With that, let me hand the call over to Fay Feller, our Chief Medical Officer.

Thank you, Chip, and good afternoon to everyone on the call. We were thrilled and very proud to report positive top-line results from our Emerge Phase 3 study of imital stat in lower-risk MDS in the beginning of January. On our January conference call, we presented detailed efficacy and safety results, which are available on the IR section of our website under presentation. Today, I will provide a high-level summary of those results which we believe confirms a positive overall benefit-risk profile for imetalstat. We saw statistically significant and clinically meaningful improvements in the imetalstat-treated patients compared to the placebo control arm. Specifically, the trial met its primary endpoint of 8-week transfusion independence, as well as the secondary 24-week TI endpoint. we saw substantial increases in both hemoglobin levels and reductions in transfusions. We also saw efficacy across MDS subtypes, including both RF-positive and RF-negative patients, and irrespective of baseline transfusion burden or IPSS risk category. The initial clinical and molecular evidence we reported support Imatel's test potential for MDS disease modification. and the safety results were consistent with prior Imatelstat clinical experience. The most frequent adverse events were neutropenia and thrombocytopenia, which were manageable and reversible, with the majority being resolved in less than four weeks. Importantly, any serious clinical consequences from these cytopenias with Imatelstat treatment were observed at low rates and were similar to placebo. We are planning to present and publish additional data and analyses from iMERGE throughout 2023. As we have been collaborating with key opinion leaders to prepare these abstracts and discussing the top line results with providers, we have received excellent feedback on the readout, as well as acknowledgement on the potential for Invent HealthSAT to represent a meaningful treatment advance in lower risk MDS. Based on these positive top line results from iMERGE phase three, we continue to execute on our plan to submit an MDA in mid 2023. Since our request for rolling submission was granted, we have submitted the non-clinical module of the NDA this quarter. We remain on track with our plan to submit the remaining modules, including clinical and CNC by mid-year. Also this quarter, we participated in a standard pre-NDA meeting for the FDA. There were no showstoppers at that meeting, nor comments that change our expected timeline or fundamental strategy for the NDA submission. When we submit the NDA, we plan to request priority review as allowed under our fast-track designation in lower-risk MDS. If granted, we expect FDA approval of the MDA and a U.S. commercial launch of the Mattel staff in lower-risk MDS could occur as early as the first quarter of 2024. In addition, the MAA submission is planned by the end of 2023. Typically, the review time for an MAA is up to 14 months, Thus, we expect the timing of potential approval of the MAA by the end of 2024. Please note, going forward, we don't plan to provide any details relating to regulatory interactions unless they result in a change to our submission strategy or expected timing. Moving on to our second phase three clinical program, let me outline our plans in 2023 for relapsed refractory MS. IMPACT-MF is the first and only Phase III MF trial with overall survival as the primary endpoint. To trigger the interim analysis for the study, death events need to occur in more than 35% of the total planned enrollment of 320 patients. Thus, the timing of the interim analysis depends on the number of enrolled patients as well as the rate at which death events occur. Potentially, the number of events required to conduct The interim analysis for this study could occur before enrollment is complete, as these death events will accrue throughout the enrollment period. Using current planning assumptions around enrollment and median OS estimates for each treatment arm, we expect the interim analysis for Impact MS to occur in 2024. These analyses are event-driven, and it is uncertain whether actual rates for enrollment and death events will reflect current assumptions. This quarter, we initiated several strategies to increase the rate of site activation and patient enrollment, including recruitment initiatives for patient matching and more engagement with investigators through onsite visits or interactions at medical meetings. We will consider the impact of these initiatives over the next six months, as well as evaluate the overall rates of enrollment and death events occurring in the study. we expect to provide an update on the projected timing of the interim analysis after that evaluation. If the improvement in OS that was observed in IMITEL-STAT treated patients in our EMBARQ Phase 2 trial can be confirmed in the Phase 3 IMPACT-MF trial, then we believe IMITEL-STAT will be strongly differentiated from other treatments in MF currently approved or in development and will likely change the treatment paradigm for relapsed refractory MF patients. As a hematologist, I know from personal experience that physicians consider OS as the ultimate measure of benefit for the treatment of their cancer patients. We expect OS would be especially relevant in the case of impact MS patients who no longer respond to JAK inhibitors and who, due to their current dismal prognosis and limited treatment options, are in desperate need for novel therapy. Beyond our Phase III trials, we have several additional programs to potentially expand the treatment applications for imetelstat in hematologic malignancies. In May 2022, we started IMPROVE-MF, a Phase I study designed to evaluate the safety and clinical activity of imetelstat in combination with ruxolitinib in patients with frontline MS. This study design was informed by data from preclinical studies describing the sequential treatment of ruxolitinib followed by imetelstat, has a selective inhibitory effect on malignant MF stem cells, while despairing normal hematopoietic stem cells. For IMPROVE-MF, we aim to determine the safety profile of the combination regimen of ruxolitinib and imetelstat, as well as explore any potential for disease-modifying activity in a frontline MF disease setting, similar to what was observed with imetelstat treatment and the Phase II EMBARQ trial in a relapsed refractory myelofibrosis patient population. Two of the three trial sites for this study are open for patient enrollment. The remaining site is expected to open for enrollment in 2023. We also expect to present preliminary data from this study by the end of 2023. Based on preclinical models showing intel that prevented expansion of human AML leukemic stem cells and prolonged survival in stem cells, we are also supporting an investigator-led study in relapsed refractory AML and higher-risk MDS for patients who are already treated with a hypomethylating agent. As noted on the slide, this study, called IMPRESS, is evaluating imetelstat as a single-agent treatment in this severe disease. The first site is planned to open in 2023. If the initial IMPRESS data show problems for imetelstat in higher-risk MDS and AML, we expect to support another investigator-led study evaluating the combination of imetalcet plus other drugs that are part of the standard of care for such patients. Moving on to our preclinical and research programs. This slide provides a snapshot of the status of our lymphoid malignancies and next-generation TI programs. In November 2022, early data was published from the preclinical program in lymphoid malignancies being conducted MD Anderson Cancer Center. Based on these early results, we are continuing the collaboration to assess the potential therapeutic effect of imetalcet and lymphoid malignancies and expect further data by the end of 2023. The objective of our discovery program is to identify a lead compound as a potential next-generation oral telomerase inhibitor. We continue to investigate various chemical entities as potential scaffolds. We expect completion of the current discovery effort in 2023, upon which we plan to potentially advance NEB compounds into the next step of discovery research. If successful, these efforts would permit initiation of an IND-enabling non-clinical studies in the future. As I hope you can see, the positive top-line results in lower-risk MDS have provided an impetus for the next step in ImatelStats development. We believe continued progress in the other areas I described such as relapsed refractory MF, frontline MF, higher-risk MDS, and AML, lymphoid malignancies, and the discovery of potential next-generation telomerase inhibitors, we'll explore how Imatelstat and telomerase inhibition may provide potential benefit to many more patients. With that, I will turn the call over to Anil to describe the planned activities around potential commercial launch of Imatelstat. Anil?

Thank you, Faye, and good afternoon, everyone. Lower-risk MDS is a highly attractive market with a significant addressable patient population. Given the positive top-line results announced earlier this year, we expect imitel stat to be highly differentiated and to be adopted widely in the treatment of lower-risk MDS. We are taking important steps to ensure commercial readiness at launch, As Chip mentioned, we have made multiple senior commercial leadership hires with extensive industry knowledge, launch, and operational experience. Now, with our leadership team onboarded, we continue to build out the commercial organization in a phased manner with the goal of hiring talent with deep oncology and US market experience. Our commercial go-to-market strategy revolves around the following fundamental pillars that are focused on successfully transitioning Geron to a commercial stage company and ensuring a successful launch of Imitelstat. First, on the product front, in addition to our regulatory activities, we are focused on building a comprehensive and integrated clinical and economic value proposition that conclusively outlines Imitelstat's benefits to providers, clinics, hospital systems, and pairs. We expect this messaging to highlight imital stats differentiating qualities as seen in the top-line results, which include the broad efficacy across MDS subtypes, including both RS positive and RS negative patients, the durability of continuous transfusion independence, the totality of clinical benefit, which includes reduction in transfusion burden and significant increases in hemoglobin levels, the strong evidence of potential disease modification, and what we believe is a favorable benefit-risk profile. Second, we are focused on the long lead-time supply chain activities, including state licensing and third-party logistics efforts to facilitate efficient distribution of imital stat and smooth flow through the U.S. healthcare system. Third, a key focus for us is on broad engagement with a diverse set of stakeholders, including providers, payers, and advocacy groups to seek a favorable reimbursement for a metal stack. To engage with and educate providers, our teams have planned extensive presence at global, national, and local hematology scientific meetings, to raise awareness of the challenges facing patients with lower-risk MBS. We are also extensively engaged with payers and planning submissions of IMITEL-STAT data to major societies, including NCCN and ASCO, for their consideration for inclusion in guidelines. In addition, we remain heavily engaged with patient advocacy groups. Fourth, our efforts are also focused on Geron's organizational evolution to a commercial entity This effort involves building and expanding the functions and capabilities across Geron, including information technology, human resources, finance, and legal to support Geron's future growth and our commercial ambitions. I look forward to providing updates on commercial activities throughout the year. Now, I'll turn the call over to Olivia for a financial update. Olivia?

Thanks, Anil, and thanks to everyone on the call for joining us today. Please refer to the press release we issued this afternoon, which is available on our website for detailed financial results. As expected, overall operating expenses for the fourth quarter and full year 2022 were higher than the same period in 2021. Total operating expenses for the three and 12 months ended December 31, 2022 were $42.1 million and $139.1 million, respectively, compared to $32 million and $115.4 million for the same period in 2021. The increase in research and development expenses primarily reflects higher personnel-related expenses for additional headcount and increased consulting costs related to preparation for top line results and regulatory submissions in lower risk MDS. The increase in general and administrative expenses primarily reflects increased costs for commercial preparatory activities, higher personnel related expenses for additional headcount, and our portion of settlement costs related to the class action and derivative lawsuits. For fiscal year 2023, we expect non-GAAP total expenses in the range of approximately $200 million to $210 million. The fiscal year 2023 guidance reflects costs to support planned regulatory submissions in 2023, ongoing clinical trials, emerge phase three, impact MF, improve MF, and impress, as well as preclinical studies in lymphoid malignancies and discovery research for next-generation telomerase inhibitors, manufacturing commercial inventory for Imatelstat, preparations for potential U.S. commercial launch of Imatelstat in low-risk MDF, and projected increases in headcount as well as interest payments on outstanding debt. The fiscal year 2023 financial guidance is based on a set of assumptions. If those assumptions are updated later in the year due to changes in our plans, including in response to potential revised timing of FDA approval and potential U.S. commercial launch of Imatelstat in low-risk MDS, then we plan to update guidance at that time. As of December 31, 2022, we had approximately $173.1 million in cash, cash equivalents, restricted cash, and current and non-current marketable securities. On January 10, 2023, we closed our underwritten public offering for net cash proceeds of approximately $213.3 million after deducting the underwriting discount and other offering expenses. In addition, in January and February 2023, we have received $59.8 million in cash proceeds from the exercise of outstanding warrants. As a result, we accumulated total cash holdings in excess of $445 million. Based on our current operating plan and our expectations regarding the timing of the submission and potential acceptance and approval, of our planned MDA by the FDA and the potential commercialization in the U.S. for the use of Imatel Stats in adult patients with low-risk MDS, we believe that our existing capital resources will be sufficient to fund our projected operating requirements through the end of the third quarter of 2025, which includes potential U.S. commercial launch of Imatelstat and low-risk MDS in the first half of 2024. With that, I will now turn the call over to Chip for closing remarks. Chip?

Thanks, Olivia. John has made remarkable progress over the last few years, and especially in the past six months. We look forward to completing the regulatory approval and commercial launch activities now underway, and hopefully, to seeing Imatelstat become part of the standard of care in low-risk MDS. We also expect Imatelstat will potentially become part of the standard of care in relapsed refractory myelofibrosis if the IMPACT-MS study has a positive readout, either at the interim analysis expected in 2024 or at the final analysis expected in 2025. As we transition from a clinical stage to a commercial stage company, We have never been more excited by our vision of Geron becoming a leader in the treatment of hematologic malignancies, and in doing so, positively impacting the lives of patients with these diseases. Thank you for your continued interest and support of Imatelstat and Geron, and we'll be glad to take your questions.

Thank you. As a reminder, if you would like to ask a question, press star followed by the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster. Your first question today comes from the line of Kalpit Patel with B. Riley. Your line is now open.

Hey, good afternoon. Thanks for taking our questions. Maybe one on the Phase III impact MF study in the last refractory myelofibrosis. Can you give us a little more color on how the enrollment is progressing in that trial? maybe what percentage of patients have actually been enrolled if you have that info available?

Hey, CalPIT, it's Chip.

I think Faye will take most of the clinical questions. Go ahead, Faye.

Thanks, Cal. As we mentioned in the prepared remarks, we still expect the interim analysis in 2024 based on our current planning exceptions. And we will announce when we've reached 50% enrollment.

Okay.

Okay. And then maybe a couple on the earlier stage, improved MF trial. Are you planning to maybe release all of the data from part one by the end of 2023, I believe you mentioned?

We're currently focused on continuing to open sites in accrued patients. We will open the third site by the end of the year and will prevent a data readout guidance later on and at that time.

Okay. Okay. And maybe one more question on that trial. I think the protocol requires in part one the use of ruxolitinib for at least 12 weeks prior to enrollment. I guess, does that in any sense impact how you're viewing the efficacy bar for this trial, this open-label study? I'm just trying to get a sense of, you know, if it's fair to make comparisons to historical efficacy with rux.

Thanks for the question. Really, the purpose of the trial is to assess safety, and the lead-in period for the Ruxolitinib use is supported by preclinical data we have showing sequential use of Ruxolitinib and then Imitalstat has a potential for more efficacy. But it also allows us to enroll patients on a stable dose of Ruxolitinib so that we have a better understanding of any additional toxicities when we add Imitalstat and the safety profile once Imitalstat is added. So it's really meant more for a safety perspective.

Okay, that's helpful. Thanks very much, Faith, for taking the questions. Thanks, Cal.

Your next question comes from the line of Steven Wiley with Stifel. Your line is now open.

Yeah, thanks for taking the questions. Can you talk about the side overlap between ImpactMF and iMERGE and just whether or not you've seen any tick up in enrollment following the positive iMERGE data disclosure earlier this year?

Sure.

Thanks for the question. We have seen, after the release of the top-line results for iMERGE, we have seen an increased interest in impact MS and in improved MS and just general positive feedback regarding both of the studies. In major medical centers, there may be overlap in the sites, but both are global studies and there are plenty of sites for both.

Okay. Can you maybe just provide some additional color around the cadence of incremental iMERGE data that we should expect to see over the course of this year? And I guess, should we expect patient reported outcomes data to be included in the next medical conference presentation?

Sure, we do plan to present the additional data at medical meetings and also plan to submit the data for publication So we do expect to report patient-reported outcomes in the near future.

Okay. And then maybe just lastly for Olivia, you provided cash runway guidance through the third quarter of 25. Does this guidance assume that the second tranche of warrants are also exercised? I think that these get triggered on the basis of FDA accepting the NDA filing in low-risk MDS.

Thanks for the question. No, the guidance does not include that. So it would extend the runway further if those proceeds would be received. So the guidance to the end of third quarter 2025 is just what is currently on the balance sheet after the financing and after what's been received so far from exercise of warrants.

All right, great. Thanks for taking the questions.

Your next question comes from the line of Joel Beattie with Baird. Your line is now open.

Great. Thanks for taking the questions. The first one is, are you able to share any feedback from FDA on their openness to filing with Priority Review?

Sure.

I'll take that really quickly, and then Faye can add if she has anything. Joel, it's Chip. FDA generally does not give any insights, and generally we rarely ask regarding insights into priority versus standard review. The answer would almost always be that's a review issue. As you know, they first have to look at the NDA submission and accept it for filing, and that generally takes 60 days. And then at the time that they accept it for filing, if they do, then that's when they tell us whether we'll have a priority or a standard review. All we've said about it that I recall is that we expect to request a priority review, which is based on our – on our current regulatory designations with Fast Track and so forth. So that's pretty much all I know that we can say. Faye, did I leave out anything from your perspective?

I was saying, sure, that was pretty comprehensive. I don't have anything to add.

No. Okay. Great. That's helpful. Another question. When you discuss the eMERGE Phase III data with payers, are there any drugs that come up as counts with regards to the value that's provided to patients.

Neil, you want to address that? Sure.

So, the question around the pair feedback is extremely positive. I think the drugs that continue to come up are obviously Reblosil and Covi within the Norisk MDS landscape. but our entire discussions are focused on our value proposition, both the efficacy profile, the totality of benefit, and what it could mean for the payers within their value proposition. So as of right now, these discussions are extremely favorable, and this data is being received well.

Great. Thank you.

Your next question comes from the line of Gil Bloom with Needham. Your line is now open.

Hi, everyone. Good afternoon. So maybe one for Anil. How important do you think long transfusion independence data will be for effective pair coverage? And do you expect longer TIs to matter more to pairs, i.e., waiting on additional iMerge data to really have a broader picture. Thank you.

Thanks for the question. I think the durability of the TI data is extremely important, both in the US as well as in Europe. This point has repeatedly come up from PEARS as well as clinicians to showcase the durability of TI. And the most important metric being measured from their perspective is the 24-week TI data. The fact that we have one-year TI data on top of that, which is pretty unprecedented in this landscape, is extremely favorable to us. And in addition, the totality of benefit in terms of both reductions in transfusion burdens as well as The fact that we go across both subgroups, all of these points are being extremely well received, and we expect to be in a very favorable position as we move forward towards launch.

Thank you. Very helpful. And a quick one for Olivia. Seems like you're going to have quite significant cash burn this year. I mean, in my own calculations, I had some of your clinical study costs going away. So how do you think the division is going to be? Is this mostly optics going to SG&A and Salesforce ramp up? Thank you.

So, Gil, thanks. So it is about a $60 million increase from the 22 guidance to where we are in 23. And that is driven by a number of categories. So first it would be headcount. and that's about 40% of the increase. Regulatory submission work and everything that goes along with that for both the U.S. and the EU, that's another 10%. Commercial manufacturing and building up the inventory of Imatel stat, getting ready for potential commercial launch, that's another 20%. And then in general, other activities related to commercial readiness, which is another 30%. So I do want to Let you know, though, that overall the clinical costs, though, still are being maintained in the company because obviously we have another phase three trial going on, ImpactMF, as well as the other studies that Faye mentioned.

Great. That was very detailed, and thank you for that. I'll jump back into the queue.

This concludes our Q&A for today. I now turn the call back to Aaron Feingold for closing remarks.

Thanks so much, everyone, for joining us today. We appreciate you taking the time to listen and participate. We look forward to sharing the achievement of several milestones in the coming year. Stay healthy and safe, everyone. Bye.

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