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spk01: Good afternoon, everyone, and welcome to the Spectrum Pharmaceuticals third quarter 2021 financial results conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. And if anyone should require assistance during the conference, you may press star zero. And as a reminder, I would now like to turn the conference over to your host, Mr. Kurt Gustafson, Spectrum Chief Financial Officer.
spk07: Thank you, Operator, and good afternoon to everyone. Thank you for joining us today for our third quarter 2021 financial results conference call. Our third quarter financial results press release was sent out earlier this afternoon and is available on our website at www.sppirx.com. Joining me on the call today from Spectrum Pharmaceuticals will be Joe Turgeon, President and CEO, and Dr. Francois Lebel, our Chief Medical Officer. Before we get started, I would like to reference the notice regarding forward-looking statements included in today's press release. This notice emphasizes the major uncertainties and risks inherent in these forward-looking statements that we will make this afternoon. These statements are not guarantees of future performance, and undue reliance should not be placed on them. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. With that, let me hand the call over to Joe Turgeon, CEO of Spectrum.
spk04: Thank you, Kurt. Good afternoon, and thank you for joining us on the call today. I really appreciate your interest in Spectrum. As we start to close in on the end of the year, we remain focused on our key corporate priorities. First, to submit the posiatinib NDA, and second, to correct the manufacturing issues identified by the FDA in a Rolantis CRL. Let me start with an update on Rolantis, our drug for the treatment of neutropenia in patients receiving myelosuppressive anti-cancer drugs. Last month, we had a Type A meeting with the FDA to better understand the issues that were identified in the CRL. The CRL cited issues at the fill-finish facility and the drug substance facility. At that meeting, we gained clarity that the deficiencies at the fill-finish site have been adequately addressed and are no longer a gating item for resubmission. Regarding the drug substance facility, as of today, we believe that Hanmi has addressed all of the deficiencies cited in the CRL with the exception of one, and we expect the remediation to be completed by the end of the year. Pending successful completion, we would expect a refile shortly thereafter. A Type A meeting also clarified that the FDA will be conducting an on-site inspection as part of the resubmission process. We'd expect a six-month review once we submit. While HANMI is diligently working to resolve the issues associated with the CRL, we are continually monitoring the long-term long-acting GCSF market, and we'll be prepared to adjust our business plans as the market evolves. Now let me shift over to Poseyotinib, the other large late-stage asset we have in our pipeline. The submission of the NDA remains our top corporate priority, which we expect to file shortly. In addition, Spectra's Poseyotinib clinical program has continued to make solid progress this quarter, with data presented in treatment-naive lung cancer patients, as well as preclinical data on POSI in combination with KRAS G12C inhibitors. Now, to get a more detailed update on our clinical development progress, I'm going to turn the call over to Dr. Francois Labelle, our CMO. Dr. Francois, take it away.
spk06: Good afternoon, everyone. I'm glad to be with you on today's call. Let's start with our top priorities. The submission of our posiotinib NDA under FASTRAC designation is planned for the coming weeks. It will be based on our positive data with QD dosing from cohort 2 of the ZENIT-20 clinical trial. Our submission will be seeking an indication for use in patients with previously treated locally advanced or metastatic non-small cell lung cancer with ER2 exon 20 insertion mutations. We believe posiotinib has the potential to be the first to market for this indication, an area of great unmet medical need. We were also very pleased that cohort four was awarded a late-breaking presentation at the recent ESMO conference in Paris. Dr. Cornelison from the Erasmus Cancer Institute in Rotterdam, delivered an oral presentation on the efficacy and safety of POSI in treatment-naive non-small-cell lung cancer patient arborine HER2 exon 20 insertion mutation. This was data from our cohort four of the Xena 20 study that included the first 48 patients that received 16 mg QD, oral starting dose of posiatin. The primary endpoint in this multicenter study was the ORR, evaluated centrally by an independent image review committee using resist criteria 1.1. The results observed were quite strong. with an ORR of 44% and a 95% confidence interval lower bound of 29.5%. The disease control rate was 75%. Median duration of response was 5.4 months and ranged from 2.8 to 19.1 months, including a complete response patient with 14 months of duration. Median progression-free survival was 5.6 months. The most common treatment-related adverse events were typical of tyrosine kinase inhibitor, as was seen in prior studies. Grade 3 AE were rash, stomatitis, diarrhea, and paronychia. Importantly, grade 3 pneumonitis was only seen in one patient with no grade 4 or 5. The safety profile was predictable and manageable. Following these first 48 patients, we've been dosing patients at the eight milligram BID dosing schedule. At the AACR NCI EORTC triple meeting in October, MD Anderson presented preclinical data demonstrating the synergistic impact of POSI when combined with KRAS inhibitors in KRAS G12C mutant-specific cell line. The preclinical data showed that inhibition of EGFR, HER2, HER3, and HER4 signaling was synergistic when combined with KRAS G12C inhibitors. These results highlight the importance of a potent, pan-inhibitor of the herb family of proteins. We continue to make solid progress on our programs and will keep you posted as we achieve key milestones through the balance of the year. I will now turn it over to Kurt for a discussion of our third quarter financials.
spk07: Thank you, Francois. Our SG&A expense for the third quarter of 2021 was $12.2 million versus $15.1 million in the previous year, as we've looked to more tightly control these expenses. R&D expense was $20.9 million versus $24.5 million a year ago due to lower Relontis-related development activities. Our net loss for the quarter was $33.1 million, or 21 cents per share, versus $48.5 million, or 37 cents per share, comparable period of 2020. On a non-GAAP basis, which primarily backs out stock compensation costs and the change in value of our equity securities, our loss for the quarter was $25.8 million or $0.16 per share versus a loss of $35.2 million or $0.27 per share in the prior year period. We ended the third quarter with approximately $134 million in cash plus marketable securities, compared to $159 million at June 30th, 2021. Operating cash burn for the quarter was $25 million. This is lower than prior quarters as we've looked to manage cash more closely. With that, let me now hand the call back over to Joe.
spk04: Thank you, Dr. Francois, and thank you, Kurt. As you can all see, we are working diligently to push our programs forward. We are making great progress on our remediation efforts for a resubmission of Rolantis and tracking well towards a goal of a Poseyotinib NDA submission shortly. With that, operator, I'd like to open the call up to questions. If you could please do that, I'd appreciate it.
spk01: If you have any questions at this time, please press star, then the number one on your touchstone telephone. And if your question has been answered or you wish to remove yourself from the queue, you may press the pound key. And first question comes from the line of Alethea Young of Cantor Fitzgerald. Alethea, your line is now open.
spk00: Hi, this is Emily on for Alethea. Thanks for taking our question. I guess the first question is, do you think there's any risk of COVID with doing the reinspection in person? And has the FDA kind of guided to how quickly they could do the reinspection after you submit the CMC requirements? And then maybe also if you can comment on when we can see BID data for cohort four for posiotinib. Thank you.
spk04: Sure. Thanks, Emily. Good to hear from you. First of all, as far as COVID, obviously I don't know the answer to what's going to happen in the future. As I stated earlier, we should have everything remediated by the end of the year, which would mean an early first quarter we could resubmit. The FDA did say they want to do an on-site inspection. What I can tell you, though, is today, as an example, you can travel to Korea. We have people going there actively. So I'm not sure what will happen with COVID in the future, but certainly right now you can travel to Korea. So we're doing it as we speak. So that's the first part of the question. So we don't know exactly when they would send the inspector. I can tell you that it would be a six-month review. That doesn't mean it would take six months. So anytime after we file, they could send an inspector back to do a re-inspection. Now, as far as the cohort four question, Francois, why don't you take that?
spk06: Sure, Alicia. Thank you for the question. So as you know, the BID dosing is ongoing for all our open cohorts right now. including cohort four, which continues to enroll. And we need to let the data mature further. And, you know, as you, I'm sure you understand, the team is really focused on the NDA now. So once we get the NDA in, we will analyze some of the additional data as it matures and We'll keep you posted, but we don't have a date immediately.
spk00: Great. Thank you.
spk05: Thank you, Emily.
spk01: Next question comes from the line of Murray Raycroft of Jefferies. Murray, your line is now open.
spk03: Hi, Murray. Hi, Joe. Hi, everyone. Thanks for taking my questions, and congrats on the progress. First question, just on the NDA filing. If you can just talk a little bit more about what you're gonna include in the Poseyotin and Pertu XN20 filing for second-line patients, and are there any more specific gating factors that need to be completed before you submit this filing?
spk04: Yeah, Francois, why don't you take that?
spk06: Sure. We're in good shape. Obviously, I'll answer on deck here. As I indicated, we expect to be able to file this in the next couple of weeks. The data, as we indicated before, is the core data, is the Core 2 data. We communicated before that following discussion with the agency, they've allowed us to add some of the preliminary data and the BID dosing from cohort five, among others. And so obviously that will go in. Although the NDA is based on cohort two, you know, there's a large body of data here. It's like we have 21 studies that we have to summarize, integrate, So that's part of, you know, the activity that's going on here. But I hope that answers your question. So it's QD data from Core 2, and there will be some BID data in the submission as well.
spk03: Got it. And for the data, is the follow-up being cut off, or are you still waiting for a final cutoff? for data maturing, or are you primarily just working on getting the filing together? Maybe if you can clarify on that point.
spk06: Yes. So whenever you do this, so we haven't had to disclose the data cutoff, but there was a data cutoff in the past because you have to, you know, analyze all the data, get the data in from around the world. Remember, there was a global study here and multiple other studies So there is a definite data cutoff that's in there. What happens, though, and that's standard, usually what happens is that 120 days after submission, you provide an update on the data that you have accumulated since the filing to the agency, and certainly we will do that as well.
spk03: Got it. Okay, and then just last question for me, just on the data that you showed recently on HER2 treatment-naive patients at ESMO and the late breaker with the 16-meg QD dose. Can you just talk more about what the bar for success is in this setting? And if you can comment on what the pre-specified endpoint is.
spk06: Sure. So as you... You know, originally we, the original submission or the original agreement with the FDA was on 70 patients in COVID-4, and we had to meet pre-specified endpoints and a lower bound of 20, and clearly Things are trending very well right now, and I'm going to leave it at that, because obviously the study is continuing to enroll. So we're tracking quite well, and that's why we're quite enthusiastic with the ESMO presentation.
spk03: Okay, and can we expect a follow-up on this at some point, too? Are you guys commenting on that?
spk06: We definitely will want to release data once it matures a little more. We just have not given a date yet, but for sure, you will see some of that data as it matures. Okay.
spk03: Okay. Thanks for taking my questions.
spk06: Sure.
spk03: Thanks, Murray.
spk01: Next question comes from the line of Ed White of HC Wainwright. Ed, your line is now open.
spk08: Hey, Ed.
spk01: Hi, Joe.
spk08: Thanks for taking my question. So I do have a couple of them. First on cohort four, you had the 48 patients presented at ESMO. Can you just remind us, are these 48 patients going to be the only ones at the 16 milligram and then the other 22 will be at the BID dosing? or would there be less BID dosing than 22 patients out of the 70?
spk06: So, you know, as you know, we presented in the first 48 patients giving efficacy and safety. We provided a little bit of additional data on some of the BID patients, but the So once the data matures, and we're continuing to enroll right now, and once we do analysis and have some discussion with the agency, we'll decide how much data we have, how much we need to potentially go for registration. But we just don't have any additional guidance to give you today.
spk08: Okay, Francois. Well, maybe we could talk about another product in the pipeline. You know, the FIT platform, you haven't really discussed that. I was just curious if you can give us any update on the ING-002 and refractory non-Hodgkin's lymphoma. Is there any update there? And then also, you know, as far as the POSI and KRAS preclinical data go, As you look at that data, are you thinking of running a company-sponsored trial in the clinic in that patient population or, you know, with KRAS product or perhaps an IST, something like that?
spk06: Sure. So let me start with FIT. So, as you know, we've indicated that before. You know, when you do a first-in-man dose escalation study, you don't have efficacy data. And what has happened is during the worst part of the COVID pandemic, this study got caught into that. It clearly was impacted negatively in terms of accrual. And it has performed clearly slower than we wanted. We're reviewing that asset and making sure what we want to do with the asset. It's currently open and recruiting. We will assess this following a review, given how long it's been going. So we'll update you on this. Clearly the priority is POSI, RELANTIS, rather than these very early stage programs. So that's the first answer. The next one for the KRAS, so we're quite excited. I mean, you know, we'll grant you that this is... preclinical data, but nonetheless, it really shows, you know, KRAS inhibitor, one of which Amgen has been approved, but there's relatively rapid development of resistance. And companies and investigators realize that they're going to have to combine drugs. And the question is, which one do you combine to get the best outcome for patients? And this in vitro data is really encouraging because it shows that you don't need just a TKI, but you really, there's an advantage, at least in vitro, to have a true pan-HER inhibitor. And to our knowledge, the most potent one is posiotinib. So we're clearly very interested in pursuing this further. We have not at this stage decided if it's going to be with an ISS or a company-sponsored study, but we'll update you, I'm sure, in the near future.
spk08: Thanks. And maybe finally just a question to Kurt. I was just wondering, you know, you're doing a great job with your cost-cutting. Can you give us any guidance on cash runway or maybe some you know, directionally what we can be seeing in, you know, GNA and R&D as you're looking forward to, you know, the responding to the CRL and also submitting POSI for approval. Thanks.
spk07: Sure, Ed. Yeah, I mean, so we ended the quarter with $134 million, you know, in cash and marketable securities. This should be sufficient cash balance to kind of fund operations late into 2022, which obviously takes us through a time where we could potentially see approvals for, you know, these two late stage assets. You know, in terms of guidance, we don't give any specific guidance. We, you know, as I mentioned on the call, we have been looking to control and manage expenses given the recent CRL. And so you did see G&A expenses or SG&A expenses be a little bit lower this quarter. So we will look to continue to go do that, but obviously we want to, you know, invest to make these assets successful. So we are going to continue to put money into the brands for Poseidon and Rolantis, but we'll look to cut kind of areas that are non-critical to moving those assets forward here in the next few quarters. Okay, great. Thanks, Kurt.
spk04: Sure. Thanks, Ed.
spk01: Next question comes from the line of Michael Schmidt of Guggenheim. Michael, your line is now open.
spk09: Hey, Michael. Hey, this is Paul on for Michael. Thanks for taking our question. Just one from us on soziotinib ahead of the NDA submission. I wanted to confirm your thoughts on the approval hurdle for previously treated non-small cell patients given the potentially higher bar we've seen for recent approvals like Lumicrast.
spk06: Sure. So, I mean, we're going for, you know, it's Core 2 data, so it's a patient who will have at least one line of treatment for HER2 exon 20, and, you know, it's really pure exon 20 insertion mutations. So there is no approved drug there, and given the timeline that we think we're going to meet here, we really have the potential to be the first to market. And in our eyes, there is a number of other drug in development, but if you look at their data for true exon 20 insertion mutation or two, We think we have very good data at this point.
spk09: Okay, thank you.
spk06: Sure.
spk01: Next question comes from the line of Mayank Mantani of B-Riley Securities. Mayank, your line is now open.
spk02: Hey, Mayank. Hey, good afternoon. Thanks for taking our questions and congrats also on the progress. So at the highest level, Francois, if I may just ask you your latest thinking on the path for registration for the BID dose. Is it just getting, you know, more patients treated, higher sample size, longer follow-up across cohort five and cohort four? And then the specific question I had was, as part of your, excuse me, as part of your NDA filing, what confirmatory study are you committing to in terms of design? Because obviously, you know, you need to do that as part of the X-rated approval.
spk06: Yeah, two very good questions. So the BID data, we thought that, you know, it was an important win in some of the discussion we've had with the agency so far that they allowed us to include some BID data on top of the QD data from cohort two. So I can't give you an exact final answer, if you want, as to our latest thinking about BID, because I think it's going to really depend on how the FDA will interpret the BID data that we have put in the NDA as it goes in. So we'll have to judge how they feel about the BID data. Clearly we have shown that there was some very good activity that was maintained as well as a side effect profile that appeared certainly in the early patient that we have seen to be favorable to QD. So that's going to go in there. We're going to have some discussion during, I imagine, the NDA review, and we'll see where we go from there. So that's the first question. I think, I'm sorry, can you remind me of your second question?
spk02: Yeah, the confirmatory study to get the full approval.
spk06: Yes, absolutely. So we, you know, I would say we're in discussion with the agency regarding this, and we clearly have developed a PMR. And, you know, when you file the NDA, you have to have a PMR essentially underway. And so we absolutely intend to do that. but obviously we want to make sure we are in complete agreement, if you want, as to the nature of the PMR. So I'm not going to go any further on that, but it's probably a randomized controlled study that takes the so-called, what clinicians use, because there is no approved standard of care or approved drug for the reserved two patients. There are multiple guidance from various groups, but those are not, you know, they don't have the same strength as a prior approval. So right now it's some form of chemotherapy, as I'm sure you know, and plus or minus some checkpoint. And, you know, we'll need to define that with the agency. And, you know, probably quite soon you will be able to see what we're doing.
spk02: Understood. And my final question, just remind us where we are with Cohort 6, just trying to understand, you know, the OC Martinet failures, you know, like kind of what the end market there is and how you may be enrolling there with the new doors it may be in.
spk06: Yeah, so, you know, we certainly, they're continuing, Cohort 6 and 7 are continuing to enroll. There is some restriction of where we need genetic profiling of the tumor at time of relapse, if you want, and that obviously gets in the way a little bit of accrual, but they're accruing, and obviously that's not our primary focus. We're focused on the NDA. But at some point, we will certainly, you know, announce the result of COVID-6 and 7. I just don't have a date for you quite yet.
spk02: Thanks so much for taking our questions.
spk04: Sure. Thank you, Mike.
spk01: Next question comes from the line of Rennie Benjamin of J&P Securities. Rennie, your line is now open. Hey, Ryan.
spk05: Good afternoon. Hey, Joe. How are you? I apologize. My phone dropped, so you may have answered this already. But as I think about, you know, the BID data and the QD data and the fact that, you know, you'll be submitting this NDA and have the option to, you know, obviously update it, I guess, with BID data, you know, do you think that you could, in this iteration of the NDA – you know, wind up getting a label that includes both? Or do you feel that, you know what, we'd likely need to file this as a separate, you know, sort of SNDA when it comes to BID dosing? And just related to that, how many patients total do we have that have been treated with BID?
spk06: So, the first question, I did answer it a little earlier, but let me give you the cliff note here. So, You know, we were very pleased. The agency has allowed us to include the BID, some of the BID data that we had in the NDA, which, you know, as you know, is QD dosing. So we'll get a chance to discuss with the agency that BID data. And obviously that body of data is increasing all the time. So we have, you know, BID dosing if you look at non-small cell, we're in cohort 5, we have some in cohort 4, and 6 and 7 as well. So we have not disclosed the exact number of patients that we have so far. You know that we have more than 22, and let's just say that we're in excess of 100 patients when you combine it all the cohorts where we're using the ID.
spk05: Got it. Thanks for answering that. And again, apologies since you had to answer it twice. Did you also answer before if, I guess the other question I have is, do you think there might be an ODAC panel for this application?
spk06: Yeah, I don't know. Right now, I don't think it's, You know, often ODACs are for when there is, you know, a controversial issue that the agency wants to get, you know, input from the oncology expert community. You know, so far, you know, to our knowledge, there's no – major controversy here. You know, we have met the primary endpoint as agreed with the agency some time ago, and we believe that we have a safety profile that is really predictable, very much in line with other TKI. There's no kind of idiosyncratic reaction, so We obviously can't predict what the FDA will want to do eventually, but right now we don't have any indication that that will be necessary.
spk05: Got it. And then just switching gears to Rolantis, Joe, you guys did a great job in addressing a lot of these deficiencies, at least a lot quicker than I would have thought. Could you maybe give us just a little bit of color? And I mean, it seemed like there were pretty small boxes to check, just given how quickly they were remediated. But can you give us a sense and in both the facilities, you know, what really needed to be corrected? And, you know, I think, you know, this last remaining gating item at HEMI, which you hope will be, you know, completed by the end of the year. whether when you had your meeting with the FDA, you were able to show them documentation that said that it was taken care of, or they kind of just take your word for it. It's more just like a free-flowing dialogue, and they'll ultimately just come in and re-inspect everything and go with their own decision.
spk04: No, I wish it was that easy. What it is is you go in, we went in, we had the Class A meeting, as you said, and we clarified, you know, we wanted to make sure, okay, exactly what it is that we need to remediate. We immediately started, once the CRL happened back in August, immediately Hanmi went to work on remediation because you get, you know, they tell you what it is, and so we immediately got that. There's one gating item that, as you pointed out, we feel pretty confident it's going to be done by the end of the year. That's why we say we could file shortly after that. Now, they still have to have someone come and inspect the plant. They still have to go through all the CAPAs. Part of the remediation is you do CAPAs. So they'll still go through all those, but, you know, what we've done is put the remediations into place, put the CAPAs in place, and that will all be part of the final inspection and decision in the end.
spk05: Got it. Great. Thanks for taking the questions.
spk04: No, thank you, Rick.
spk01: There are no further questions at this time. I would now turn it back to Joe Turgeon.
spk04: Thank you, Operator. Listen, I'd like to thank all of you who are on the call listening and for your participation on the call today. I really appreciate all your interest in Spectrum. Just to let you know, we'll be participating virtually in the Jeffries Healthcare Investor Conference later this month and also at the JMP Hematology and Oncology Summit, which is in early December. So we look forward to talking to many of you at those events also in the not-too-distant future. Again, everybody, thank you for your interest, and have a great evening. Thank you, Operator.
spk01: You're very welcome, and thank you so much to our presenters and to everyone who participated. This concludes today's conference call. You may now disconnect. Have a great day.
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