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spk02: and welcome to Purist Pharmaceuticals Q1 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Tom Burrs, Vice President Finance. Please go ahead. Thank you.
spk03: Good morning, everyone, and thank you for joining us for our first quarter 2021 conference call and corporate update. On the call today, we have Steve Yoder, our president and CEO, who will provide a corporate overview and outlook on our pipeline, Keto Kaufman, our chief scientific officer, and Shane Olwell, our head of translational science, who will be available for a Q&A. You can access the press release released this morning on the investor relations page of our website at www.piris.com. Before we begin, I'd like to caution that comments made during this conference call may contain forward-looking statements involving risks and uncertainties regarding the operations and future results of operations of purists, including statements relating to the timing and progress of our clinical trials and pre-clinical programs, our partnerships and our financial position, and actual results or events may differ materially from those expressed or implied by such forward-looking statements. Factors that might cause such differences are described in our filings with the SEC, including our annual, quarterly, and current reports. The information being presented is only accurate as of today, and Pierce undertakes no obligation to update any statements to reflect future events or circumstances. I will now turn the call over to Steve.
spk04: Well, thank you, Tom, and thank you to everyone for joining us today for our 2021 first quarter earnings call. The last few months have been very productive and marked by significant accomplishments as we advanced our proprietary and partner pipeline and leveraged existing and new alliances to materially bolster our balance sheet. Putting the past few weeks into perspective, we have generated $46 million in cash flow through milestone achievement, equity investments by partners AstraZeneca and Cgen, and the addition of a new partner. while also securing drug supply for a key combination study for our most advanced IO asset. We can and will continue to use partnerships and the power of non-dilutive funding mechanisms to reach significant corporate inflection points. PIRIS is the proprietor of a class of next-generation therapeutic polypeptides called anticalins, and we are focusing the development of anticalins in two areas. One, inhaled delivery for respiratory disease, and two, my specifics in immuno-oncology. I will first share some exciting updates from our respiratory pipeline, and I'm pleased to begin by announcing that patient dosing with PRSO60 has begun in the first part of a global Phase IIa study. PRSO60 is an IL-4 receptor alpha antagonist we are developing for moderate to severe asthma in collaboration with AstraZeneca, and it's our lead respiratory program. The first part of this two-part study is evaluating the safety and pharmacokinetics of the dry powder formulation of O60 in moderate asthmatics controlled on standard of care asthma therapy over four weeks. The second part of the study will then evaluate the efficacy, safety, and pharmacokinetics of PRS-O60 in moderate uncontrolled asthmatics over four weeks. The primary endpoint of the study will be FEV1 improvement compared to placebos. Last quarter, we announced the achievement of a $13 million milestone payment in connection with the initiation of this clinical study alongside a $10 million equity investment from AstraZeneca in connection with the restructuring of certain financial terms for PRS-060 in a manner that does not impact the overall value split of the asset between PIRIS and AstraZeneca. We are pleased with AstraZeneca's commitment to this program and to this collaboration more broadly, which also includes four Discovery Stage programs that are currently under active collaboration. In addition to our partnered respiratory programs, we are also developing a number of proprietary programs and look forward to sharing additional details, including IND plans for one of these respiratory programs later this year. Looking beyond our respiratory franchise, I would now like to discuss the progress we have made in our immuno-oncology pipeline. Our immuno-oncology pipeline is concentrated around our expertise in 4,1-BB-based bispecifics. We remain enthusiastic about 4,1-BB as a target, which is an immune cell co-stimulatory receptor that is overexpressed on activated T cells and natural killer cells in particular. and whose activation drives improved metabolic fitness of these cells. We have designed our 4-1-BB base by specifics with the objective of agonizing 4-1-BB locally to leverage its benefits while overcoming systemic and off-target side effects that have plagued systemically active 4-1-BB agonists. We were the first company to bring a 4-1-BB base by specific into the clinic, which is now progressing into phase two. And we have a number of 4-1-BB-based bispecific programs following that lead. SINRA Bifusp Alpha, also known as PRS-343 or SINRA, is our lead 4-1-BB clinical program. SINRA is a 4-1-BB HER2 bispecific that we have tested in two Phase I studies. Last month, we presented a clinical data update from the Phase I monotherapy study of SINRA at AACR. disclosing additional clinical benefit at the highest dose, including an additional confirmed durable partial response, three additional patients with stable diseases best response, and overall durable benefit. SINRA has shown a clear dose response and a 401 driven mode of action, and clinical benefit was observed in patients with cold tumors as well as those with HER2 low expressing tumors. SINRA has shown an acceptable safety profile at all doses tested with no dose-limiting toxicities. These findings provide the rationale for advancing this asset into a Phase II trial in HER2-expressing gastric cancer, a tumor type that continues to derive benefit from immunomodulatory therapies. As recently demonstrated by the Keynote 811 clinical study outcome, which led to the approval of pembrolizumab when added to the first-line standard of care, trastuzumab, and chemotherapy. The dose-dependent activity we are seeing with SINRA supports our recommended Phase II dose, which consists of a two-cycle loading dose at 18 mg per kg on a Q2 weekly regimen, followed by an 8 mg per kg Q2 weekly regimen in subsequent cycles. As a reminder, the Phase II study will be a two-arm study. The first arm will We'll evaluate SINRA in HER2-high gastric cancer in combination with ramicerumab and paclitaxel, with Lilly supplying ramicerumab at no cost to PURIS as part of a trial collaboration agreement. We expect to begin enrolling this 20-patient study arm later this summer, focusing on the U.S. and South Korea, where gastric cancer has a high prevalence. We are setting a high bar for go-no-go in our planned interim analysis of this study to ensure that we remain competitive with the evolving treatment landscape, and we'll be looking at a composite of efficacy measures, including durability and safety, in addition to objective response rate, or ORR. We are setting the ORR target at a minimum of 50% at this interim analysis, which is higher than the 28% ORR benchmark established by Ramiserumab and Paclitaxel and takes into consideration potential emerging standard of care and its bar we believe we can achieve given the activity we have observed with SINRA to date and the complementary mode of action in this combination. We believe that setting stringent criteria for advancement of our proprietary assets will help to ensure prudent and judicious use of our corporate resources and that achieving these criteria can translate into meaningful value for patients and shareholders. The second arm of the study will enroll 20 patients with HER2-low gastric cancer and will evaluate SINRA in combination with tucatinib, which will be supplied by our partner, CGEN, at no cost to PURIS. In addition to the data we generated collaboratively with CGEN that showed synergy between tucatinib and SINRA in enhancing the 4-1-Bb mediated immune cell activation. The data we presented at this year's AACR conference also support that SINRA is active in the HER2 low tumor setting as we observed clinical benefit in multiple HER2 low patients receiving SINRA as a monotherapy coupled with pharmacodynamic data that demonstrate 4,1BB agonism in these HER2 low patients. We believe it is encouraging that When paired with Ducatinib, SINRA may show clinical benefit in a setting where many other HER2-targeting drugs have shown only minimal activity. HER2-low gastric cancer therefore presents a high unmet medical need and is a sizable market opportunity. And as in the HER2-high arm of this study, we are setting a high bar for success for the HER2-low arm, looking at the same composite of efficacy measures, including durability, and safety in addition to ORR. Here, we believe that achieving at least a 40% ORR would be a significant improvement over the 28% ORR demonstrated by standard-of-care ramicerumab and paclitaxel in light of the marginal activity of other agents tested in this setting. We are excited to study this novel combination regimen with CJEN, who made a $13 million strategic equity investment in PIRIS in collaboration and in connection with the amendment of our existing immuno-oncology collaboration agreement last quarter. As we are making the necessary preparations for the start of the Phase 2 study of SINRA, we are also working hard alongside our partner, Servier, in anticipation of advancing PRS-344, which is a 4-1-BB-PD-L1 bispecific into Phase 1 later this year. Last month, We also presented preclinical data for 344 at AACR, demonstrating superiority to the combination of PD-L1 and 4,1-BB targeting molecules. As a reminder, we hold exclusive commercialization rights for PRS-344 in the United States and will receive royalties on ex-US sales by Servier for this program. Servier is also responsible for further development of PRS-352 an undisclosed immuno-oncology bispecific that is also part of our collaboration. Finally, we also recently entered into a license and collaboration agreement granting Boston Pharmaceuticals exclusive worldwide rights to PRS-342, a preclinical 411BGPC3 immuno-oncology bispecific. Under the terms of that agreement, PRS received an upfront payment of $10 million and is further entitled to receive up to around $350 million in milestone payments, tiered royalties up to low double digits on sales of the treatment if successfully approved and commercialized, and a share of certain subsequent sub-licensing revenue. PIRIS will collaborate with Boston Pharmaceuticals to advance the program towards an IND submission. Boston Pharmaceuticals has a strong leadership team and proven track record of developing a broad range of assets, including oncology. And we look forward to the advancement of this novel next-generation bispecific, which follows in the localized 4-1-B-B agonism mode of action of SINRA. So in conclusion, with our focused investments in SINRA Buffus Alpha and our partnerships with Servier, C-Gen, and Boston Pharmaceuticals, We have placed our immuno-oncology bispecifics pipeline on solid footing, and we look forward to the progression of multiple assets into the clinical stage beyond SINRA, driven by material ongoing investments by these partners. This concludes my prepared remarks, and I would now like to hand the call back over to Tom to guide you through our first quarter 2021 financial results. Over to you, Tom.
spk03: Thanks, Steve, and good morning again, everyone. Cash and cash equivalents totaled 66.8 million for the quarter ended March 31, 2021, compared to a cash and cash equivalents balance of 70.4 million for the quarter ended December 31, 2020. The increase was due to the 13 million US dollars received from CGEN in March 2021, offset by our operating cash needs. The quarter end cash balance excludes both $23 million received from AstraZeneca in April and $10 million to be received from Boston Pharmaceuticals. On a pro forma basis, quarter-end cash and cash equivalents would have been approximately $100 million, which ensures that we are well-positioned to execute on our strategic plans into 2023. R&D expenses were $16.6 million for the quarter-end in March 31, 2021, compared to $12.8 million for the quarter ended March 31, 2020. The increase reflects higher spending on preclinical activities for our proprietary respiratory pipeline and manufacturing costs for our immuno-oncology programs, while maintaining flat spending on other non-project-related R&D costs. G&A expenses were $4.1 million for the quarter ended March 31, 2021, compared to 4.4 million for the quarter ended March 31, 2020. This decrease reflects more one-time costs incurred in 2020 related to the move to our new R&D facility in Albert most Germany, partially offset by higher consulting expenses in the current quarter. Net loss was 4.2 million or a 7 cent loss per share for the quarter ended March 31, 2021 compared to a net loss of $3.6 million, or a $0.07 loss per share, so the quarter ended March 31, 2020. With that, I'll turn the call back over to you, Steve.
spk04: Thanks, Tom. And as I trust you all would agree, these last few months have been a productive time at Purist, particularly with respect to our leveraging of new and existing partnerships, and we look forward to building on our momentum. Thanks to our business development activities, we have added $46 million to our balance sheet through a mix of non-diluted funding and focused strategic equity stakes from two existing partners. We remain committed to this business model. We look forward to keeping you updated on our progress as we drive towards achieving key inflection points throughout the year. I want to thank you for joining us on the call today, and we would now like to open the call to your questions. Thank you.
spk02: Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Our first question today is from Umar Rafat, of Evercore. Please proceed with your question.
spk01: Hi, guys. Thanks for taking my questions. I have a few today, if I may. One, for the asthma trial, would you have an internal readout of the Part 1? I know ClinTrial says there will be an unblinded review, so I'm just trying to understand, can we talk to you about Part 1, perhaps, even if it's not a press release? And also, would you be able to announce that you're now formally progressing to part two and that dose level three was included? Would that be a formal announcement? Should we expect that or not? And perhaps also, if you could spell out for us, what is that bar that you have to clear to include that third dose and to move to phase three? And finally, just quickly, if you could remind us the choice of site selection. I noticed it's Australia and a Ukraine site and trying to understand if we should expect U.S. sites to be up as well when you get to Part 2. Thank you.
spk04: Hey, Omar. Thanks for the questions. I'll focus on a 60 clinical study design, and that's great. I can try to take all those one at a time. So, yes, you noted, Omar, there's two parts to this study. There's the Part 1 efficacy phase, which is up to three doses, or safety phase, sorry, which is up to three doses, and then there is the Part 2 efficacy phase. which would look at FEV1 as the primary endpoint. We have not disclosed specific communication planning for the progression from Part 1 into Part 2, but as I had mentioned before, it's my personal desire, and assuming AstraZeneca is fine with that, I assume that they will be, is that we intend to be able to announce when we have or that we have progressed from Part 1 into Part 2, which I would anticipate pending enrollment as planned, that that would be sometime later this year. So that's something that we hope to be able to talk about, even though I would not expect a formal press release around any data disclosures, but then we could talk about that for sure. As far as the doses that would be used in the part one as a progression to part two, there is a certain amount of staging that is allowed, such that if one were to clear the first two doses, one could then move into the efficacy phase rather than wait for all three. So that's some nuances in design that we still will consider, but we don't necessarily have to clear all three doses before moving into the efficacy phase at the lower doses. And then as far as the sites, as you noted, we are currently leveraging efficiency and regulatory interactions and site readiness. We've been very, very accustomed to working in Australia with Phase 1 and Phase 1B with PRSO60, So we're focused there and also in the Ukraine. And we're looking at multiple additional geographies and several other sites. It's a global study. We haven't disclosed a specific strategy in the U.S. yet, but certainly interactions with the FDA are certainly contemplated before too long.
spk01: Thank you very much.
spk02: The next question is from Matt Phipps of William Blair. Please proceed with your question.
spk05: Good morning. Thanks for taking my questions and congrats on the business development activity in the quarter. You know, I guess where, given where you guys have gotten with CINRA and the data generated was really this first form BB by specific, and now it's becoming a pretty competitive space. Just looking for a bigger picture on how you can leverage that info into the rest of your pipeline. And then, and then specifically for kind of the, the PDL one, group of these biospecifics. We've had a couple other companies start to give some disclosures around their programs. Wondering what you might have taken from that that can help with the development of 344 in combination with obviously what you've learned from CINRA.
spk04: Sure, Matt. Thanks so much. There's a lot of things we could talk through there. I mean, firstly, what did the data from CINRA speak to the opportunity with CINRA itself? in the gastric cancer space in particular, and we can talk about that. Then you also mentioned the broader learnings of SINRA throughout the rest of our pipeline, and then specifically looking at the PD-L1-4-1-BB by specific approach, where there are a number of other programs that have recently moved into clinical stage, and some of them already reported some initial data. So I can just frame that at a high level, and then I'd like for Shane to go through that in a little bit more detail. And when we first think about the SINRA, you know, for SINRA's sake, looking at the opportunity in HER2-expressing tumors, you know, let's not forget that we have what I think is pretty compelling, impressive single-agent activity coupled with a very good safety and tolerability profile. And I don't want that to get lost on people because 4-1BV agonism can be a very sharp knife. And we've seen that coupled with a dose response, and I think a great set of PD correlates that will help us to, have helped us to zero in on what we think is a very thoughtful RP2D. And when we consider the single agent activity, the relevance of immunotherapies in gastric cancer, and the ability to play in both the HER2 high space and the HER2 low space, the latter being far less dynamic than the HER2 positive space, we really like those those nuances of bringing a 401BB bispecific into this field. And if you think about the biology at stake, this is the only, to our knowledge, the only HER2-engaging agent that leverages the adaptive immune space. It also brings innate immunity to it with NK cells, but compared to bispecifics, compared to novel payloads, compared to macrophage biology, this is different. And if we think about what 401BB does, which is to drive the improved metabolic fitness of T-cells, and immune cells in general, this is something we think could lead to meaningful differentiated opportunity. And there will be learnings from this into how we think about positioning the 4-1BB PD-L1-based bispecific, as well as, I think, helping Boston Pharmaceuticals on the positioning of the GPC3-4-1BB bispecific. So Shane can maybe go a little bit deeper on some of the nuances in HER2-high and HER2-low, including the bars that we announced today on ORR. as well as why we feel really enthusiastic about our specific 4.1BB PD-L1 by specific, which we've really put a lot of thought into designing for potentially, you know, best-in-class opportunity there. So I'm going to hand it over to Shane to go a little bit deeper.
spk00: Thanks, Dave, and thanks, Matt, for the question. So maybe just going back to your question in terms of, you know, what do we see in 4.1BB that excites us, and how can we leverage what we see with SINRAC? to really help position those other programs we're bringing through. So with regard to what we see with SINRA, you know, the power of 4MVB is very evident in our clinical trial. As you know, it was a translation-heavy trial where we mandated paired biopsies. That allowed us to take a look into the tumor microenvironment and see what was happening. And we see a really nice dose-dependent increase in CD8 T-cells. As Steve said, this is, to our mind, the only HER2-targeted agent that is shown to be driving expansion of T cells in the tumor microenvironment. We also have developed a very useful biomarker in soluble form BB, which can be tracked in the blood of patients, and that demonstrates target engagement and our form BB mechanism of action. And what's very important is those PD correlates are are also correlating with clinical benefits. So we're seeing patients that have the expansion of CD8 T cells and the expansion of 4-MBB gaining clinical benefit from our agent. As Steve said, the monotherapy activity is, to our mind, very compelling. What's also compelling is that we're driving that 4-MBB agonism in a HER2 low setting as well. And that is really allowed us to go for this two-armed gastric cancer study. So in terms of the first arm there, we will combine with Ramesurumab, Paclitaxel. We've set an OR of 50% or greater, and we believe that's achievable based on that very unique mechanism of action, which will complement the bulking of the... chemotherapy and the vascular normalization that will come with ramiserumab. In terms of what else have we learned from this study? Well, we've learned that we can combine with tucatinib in a meaningful way with a preclinical data set showing that we can drive strong form BB agonism of a fairly low HER2 receptor density. And when we look forward into the other studies, we're certainly bringing all of that biomarker data with us. We know what to expect from a tumor microenvironment perspective. We know that we can drive the NK population. We can drive cytotoxic T cells. And therefore, it has allowed us with regard to PRS344 to set up a very nice biomarker strategy there as well. In terms of How are we feeling about what others are doing? Well, certainly, you know, we feel that FormBP is very relevant, and the data coming out from competitor trials is also confirming that. So, you know, we will use all of the data that we've generated, all the knowledge we have of FormBP to, you know, have a smart design there. But in terms of... Yeah, in terms of PD-L1 form BB in particular, we've certainly developed a molecule which we believe has a compelling activity profile based on what we shared as AACR this year. And we look forward to taking that into the clinic later this year. As Steve said, we've also got the Boston Pharmaceuticals collaboration where we'll bring the form BB GPC3 molecule forward. All of the biomarker assays we've set up for SINRA are certainly relevant there, and we'll collaborate very closely with Boston Pharma to ensure that that clinical trial design takes full advantage of them.
spk05: Thanks, Shane. Just one follow-up. We've had, I think, at least two competitors in the PD-L1 by 4MVB space have to pick a recommended phase 2 dose kind of below what you would expect to saturate the PD-L1 receptor, or at least fully inhibit that pathway. Do you think 344 will be able to overcome that, or do you think it's okay to kind of fall in a middle dose range on the PD-L1 side?
spk00: Yeah, so to your question on the forward, they recommend a phase two dose of the competitor molecules, and they safety profiles that they have observed in the clinic, we certainly have to be aware of the fact that a PD-L1 form BB bispecific is going to be very potent. We see it preclinically. It drives T cells into a proliferative burst and also really changes their phenotype. So it's going to be a very powerful bispecific. In terms of our molecule, we certainly have gone with a moderate affinity form BB agonist, which we feel is appropriate for activating the pathway. We have to wait for the clinic to read out to see what that plays out like from a safety perspective. In terms of do you need to saturate the checkpoint arm here? Well, preclinical data would suggest not. Preclinical data would suggest that you can get very strong activation of the T-cell compartment without saturating the checkpoint arm. So I would say that there's opportunities to go forward without saturating that arm. In terms of therapeutic window, there may be small nuances between different people's approaches, but in essence, we have to let that read out in the clinic.
spk02: There are no additional questions at this time. I would like to turn the call back to Steve Yoder for closing remarks.
spk04: Okay. Well, I just want to thank everyone again for your attention and for your continued support of PIRIS. I wish you all a great day. Thank you for participating today. This concludes today's conference.
spk02: You may disconnect your lines at this time. Thank you for your participation.
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