Syros Pharmaceuticals, Inc.

Good morning and welcome to Xero's Pharmaceuticals 3rd Quarter 2023 Financial Results Conference Call. At this time, all participants are in a listen-only mode. This call is being webcast live on the Investors and Media section of Xero's website at www.xero's.com. Please be advised that today's call is being recorded. At this time, I would like to turn the call over to Karen Hunady. Director of Investor Relations and Corporate Communications at Cirrus. Please go ahead.

Thank you. This morning, we issued a press release announcing our third quarter 2023 financial results. The full release is available on the investor and media section of the Cirrus website at www.cirrus.com. We will begin the call with prepared remarks by Dr. Nancy Simonian, our Chief Executive Officer, Conley Chee, our Chief Commercial Officer, Chief Business Officer, and incoming Chief Executive Officer, Dr. David Roth, our Chief Medical Officer, and Jason Haas, our Chief Financial Officer. We will then open the call for questions. Kristen Stevens, our Chief Development Officer, is also on the call and will be available for Q&A. Before we begin, I would like to remind everyone that the statements we make on this conference call will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties, and other factors, including those set forth in the risk factors section of our quarterly report on Form 10-Q that we filed this morning our annual report on Form 10-K that we filed earlier in the year, and any other filings that we may make with the SEC in the future. Any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. With that, I'd now like to turn the call over to Nancy. Nancy? Thank you, Karen.

Good morning, everyone, and thank you for joining us. Today's call marks my last as the CEO of Ciros. In October, we announced my planned retirement as CEO and the appointment of Conley Chee as Ciros' next CEO. I am incredibly proud of the company we've built over the last 11 years. We have made tremendous progress toward our mission of translating breakthrough science into new medicine that can make a profound difference for patients on the foundation of a strong, experienced leadership team and a collaborative patient-focused culture. I look forward to supporting Cirrus in partnering with Conley and the team as I continue my service on Cirrus's board of directors. Following our strategic prioritization earlier this fall, Cirrus is a company with a singular focus. We are devoting our resources to the advancement of Tamiberitine, our oral, selective, and potent RAR-alpha agonist for the frontline treatment of hematologic malignancies. As Conley and David will detail this morning, we believe Tamiberitine has the opportunity to become the standard of care for higher-risk MDS in unfit AML patients with RARA overexpression. Tamiberitone has a differentiated profile. It is a biologically targeted agent that has demonstrated high complete response rates, a rapid time to response, and a favorable tolerability profile across multiple clinical trials. I am incredibly proud to have taken serose from a scientific discovery in 2014 to late stage development on the path to commercialization. As a company, we are approaching this important transformation with data from our first pivotal study in higher risk MDS to be reported next year and initial data from the randomized portion of our phase two study in AML that we plan to present in early December. As we prepare for our maturation into a commercial company, it is a natural time to transition leadership to Conley, our chief commercial and business officer, who is an expert at building effective commercial organizations and launching targeted oncology therapies. Conley has been a valuable member of our leadership team for over two years, informing all aspects of our business. Having worked with Conley during this time and during our transition over the last month, I am confident he will be an impactful and effective leader in this next stage for Cirrus. With that, I would like to turn the call over to Conley to provide some brief remarks. Conley?

Thank you, Nancy. I'm incredibly honored to lead Cirrus into its next exciting phase and to build on the foundation that Nancy and the team have established. Based on behalf of all our colleagues, I would like to thank you, Nancy, all your years of leadership. I'm eager to work closely alongside my colleagues and partners in my new role as CEO to execute on our development plan for Tamiberitine, prepare for our first NDA filing and launch, and ultimately deliver Tamiberitine to the thousands of MDS and AML patients in need of better options. Since I joined Cirrus two years ago, we've made great strides in building a roadmap to commercialization. With the recent restructuring, we've also now streamlined our operations to focus on our Tammy Baratine program. We continue to execute on our clinical development to prepare for an NDA filing and are developing the plan for commercial infrastructure. As we approach the initial data readout in the randomized portion of Select AML-1 in early December and the pivotal data from Select MDS-1 next year, we're increasingly focused on building a robust commercial business that can submit Tamivaritine as a standard of care for patients with raw overexpression. We believe the market for Tamivaritine is significant. Both higher risk MDS and unfit AML are diseases that are notoriously difficult to treat. The number of frontline therapies in late stage development have shrunk in recent months, and existing frontline options are insufficient. Given that these patients are often elderly and frail, It is important to have new treatment regimens that are tolerable and manageable. With Tamiviridine, we're advancing a first-of-its-kind targeted therapy, which could become standard of care for approximately 50% of higher-risk MDS and 30% of unfit AML patients who are positive for RARA overexpression. As we've noted before, approximately 21,000 people are diagnosed with higher-risk MDS and nearly 25,000 people are diagnosed with unfit AML annually in the U.S. and Europe. Altogether, this creates a substantial market opportunity for Tamibaritin. As we move closer to potentially delivering Tamibaritin to this market, we're beginning to engage in critical pre-commercial activities. If approved, we plan to deliver Tamibaritin to patients through our own commercial efforts in the United States and are well-positioned to execute on this opportunity. I look forward to leading the team through these important efforts as we work to realize the potential for Tamibaratine to provide profound benefit to patients. With that, I'll now turn it over to David to review our programs and upcoming milestones in more detail. David?

Thank you, Conley. We are very pleased by the continued progress in advancing Tamibaratine through clinical development in both AML and higher-risk MDS. We are on track to share initial randomized data from approximately 20 patients in SELECT-AML1 in early December. As a reminder, the randomized portion of the SELECT-AML1 study is designed to evaluate the safety and efficacy of tamubaratine in a combination with venetoclax and azacitidine compared to venhaza alone in approximately 80 newly diagnosed unfit AML patients with RARA overexpression. Patients are randomized one-to-one into the two treatment arms with the composite CR rate or the CR-CRI rate as the primary endpoint. We expect this initial data will inform our understanding of the potential clinical benefit of adding tamibaratine to Vaneza, the standard of care. In this initial set of patients, we expect most will have completed at least two cycles of therapy. Given that the randomized portion of the trial started enrollment in the first quarter of this year, the focus of this initial data will be on the composite complete response rates and, of course, tolerability. We believe this first direct and randomized assessment of patients with RARA overexpression treated with the triplet regimen of Tamivaritin plus Vaneza compared to the doublet of Vaneza alone will meaningfully inform our understanding of the potential benefits of our novel approach. We previously shared compelling data to support our TAMI-Veneza triplet strategy in AML late last year. Data from the safety lead-in portion of our select AML-1 study showed a composite complete response rate of 83% with patients experiencing a rapid time to response and favorable tolerability with no additive myelosuppression compared to historical data with Veneza alone. In early December, we'll provide data on an additional set of patients, all with RARA overexpression treated with the triplet, as well as a direct randomized comparison to patients with RARA overexpression treated with the Venazer doublet. Today, the standard of care for unfit AML patients is venetoclax with azacitidine, which has shown a 66% composite CR rate and a median overall survival of less than 15 months. Unfortunately, approximately one-third of AML patients do not respond to the current standard of care with Veneza, and nearly all who initially respond will relapse. Post-relapse, patients have a very poor prognosis with a median survival of only a few months. Based on data that informed the Select AML-1 study, we believe Tamibaratine is uniquely positioned to improve upon the standard of care in unfit AML, and we look forward to sharing initial randomized data next month. In parallel, we continue to evaluate tamibaratine for the treatment of higher-risk MDS, which, like AML, represents an area of high unmet need. The existing standard of care provides limited efficacy with a 17 percent complete response rate and a median overall survival of just 18.6 months. No new therapies beyond hypomethylating agents, or HMAs, have been approved in well over a decade. This, too, provides a unique opportunity for our biologically targeted approach to improve the care and treatment of patients with RARA overexpression, who can be readily identified using a simple blood test assay. Tamibaratine also benefits from a generally well-tolerated safety profile, which is particularly well-suited to this generally elderly and frail population. We continue to enroll patients in the ongoing select MDS1 phase 3 trial, evaluating tamivarotene plus azacitidine. As a reminder, the primary endpoint of the trial is complete response rate in the initial 190 patients, with overall survival now included as a key secondary endpoint based on continued enrollment to approximately 550 patients. We're very excited as we approach the completion of enrollment for the primary endpoint. We can now project the enrollment trends more precisely and expect to complete enrollment of the initial 190 patients necessary to support approval using a CR endpoint in the first quarter of 2024 and plan to report pivotal CR data by mid-Q4 of 2024. Given the biologic and clinical similarities that establish the well-understood relationship between higher risk MDS and AML and the supportive data we've seen across these patient populations to date, we believe that tamibaratine can provide significant benefit to readily identifiable, genomically defined subsets of the MDS and AML patient populations and potentially establishes a new standard of care for people with RARA overexpression. I would now like to turn the call over to Jason, our Chief Financial Officer to review our third quarter financial results. Jason?

Thank you, David. Now turning to our third quarter financial results. We recognized $3.8 million in revenue in the third quarter of 2023, consisting entirely of revenue recognized under our sickle cell disease collaboration with Pfizer that ended in October. Cirrus recognized $3.9 million in revenue in the third quarter of 2022, consisting of $3.7 million in revenue recognized under our collaboration with Pfizer and $200,000 recognized under our former collaboration with Insight. R&D expenses were $28.3 million in the third quarter of 2023, as compared to $25.8 million for the third quarter of 2022. Our R&D expenditures are now principally focused on the advancement of Tamabaratine. G&A expenses were $7.8 million in the third quarter of 2023 as compared to $8.1 million for the third quarter of 2022. Restructuring costs were $2.4 million for the third quarter of 2023, and these restructuring costs were comprised of $2 million of severance, post-employment benefits, stock-based compensation, and outplacement services, as well as $400,000 of asset impairment charges related to the laboratory equipment as classified as assets held for sale. We reported a net loss of the third quarter of $40.1 million, or $1.43 per share, compared to a net loss of $30.3 million, or $3.21 per share, for the same period in 2022. Cash, cash equivalents, and marketable securities as of September 30th, 2023, were $112 million, as compared with $144 million on June 30th, 2023. We continue to believe our current cash position will be sufficient to fund our anticipated operating expenses and capital expenditure requirements into 2025, which is beyond Phase III data from the Select MDS-1 trial and additional data from the randomized portion of the Select AML-1 trial. With that, I will turn the call over to the operator for questions.

Thank you. And ladies and gentlemen, should you have a question, simply press a star, followed by the number one on your telephone keypad. You will hear a three-tone prompt acknowledging your request, and your questions will be pulled in the order they are received. Should you wish to decline from the polling process, simply press a star, followed by the number two. And if you're using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from the line of Ted Tenthoff from Piper Sandler. Your line is open.

Great. Thank you very much and good morning. So I just want to start by asking about sort of how the landscape is changing both in AML and MDS and whether or not you think there's any major changes that have occurred since you designed the SELECT studies. And I also just want to thank Nancy for all of her hard work and really, I can't say how much I've enjoyed working with you. And Conley, I know you're going to do a great job with the company, but Nancy, thanks so much and I wish you all the best.

Thank you, Ted. It's been a real honor and pleasure and also working with you and your team. I'm going to turn the question over to David to talk a little bit about how the MDS and AML landscape has changed since we designed the select studies.

Yeah, so thanks for that question, Ted. So I think, let me just start by saying some things have not changed. What hasn't changed is the fact that there remains a very significant unmet need for patients with higher risk MDS. It's really a challenging disease to treat. The majority of patients elderly or frail, and the need for a well-tolerated, preferably, I think, a morally available therapy that's easy to administer and helps maintain quality of life continues to this day. And that's really what motivates us to continue our development of Tamibaraty. What has changed, however, is that there have been many drugs put into development over several years, over even the time that we've had Tami in development, which have not been successful. And, you know, we've watched this evolution of various trials that advanced to phase three that haven't made it. And, of course, we reflect on that. You know, we have a sort of a concern that, you know, patients need more and we sort of do wish others have success. But, you know, we look at our mechanisms. It's distinct. And we think that these issues separate us from the rest of the pack. So we have reason to remain hopeful that our program will deliver ultimately, and that's why we're so excited today. Do you want to talk about AML? Yeah, just in AML. I'm sorry I didn't answer specifically, but for AML, I think the same sort of holds true. We have, I think, seen an evolution of a standard of care that now includes venetoclax, an azacitidine in AML. It has been developed primarily for patients who are unfit. And, you know, we all do appreciate the properties of venetoclax, which, while highly effective, can be associated with myelosuppression. That makes it a bit more challenging for use in the patient population for which it was targeted. And so even in that context, we still feel there's opportunity to improve on that standard. You know, obviously, we have a program where we're adding Tamivapratin into the backdrop of metaclaxonase with a hope to improve upon the performance there. You know, and I think there still remains significant unmet need with a third of patients not responding to Veneza or patients who initially respond will ultimately relapse. So, we think there's still much that can be addressed there. There's a range of new drugs in development that are being entered into the clinic. There's a large focus on immuno-oncology drugs But it's still early days, and I think it's really a great place to be focused on our efforts for helping patients.

Let me just add one thing, Ted. It's pretty remarkable to think about the frontline treatment of these hematologic malignancies, where the median overall survival in AML based on the standard of care of Veneza is just a little over a year. And in MDS, it's a year and a half. I mean, there is just such a continued high unmet medical need in these spaces. And despite a lot of attempts to change that, I really do think that we are beginning to see sort of a potential inflection point. But that part has not changed over the years. And as David said, that's why we're continuing to be so excited about the opportunity with hantiferitin.

That's a great perspective. Thank you all.

Thank you. And ladies and gentlemen, once again, if you would like to ask a question, simply press a star followed by the number one on your telephone keypad. Your next question comes from the line of Phil Nadu from TD Cowan. Your line is open.

Good morning. Thanks for taking our questions. First, Nancy, let us add our congratulations on your tenure and coming retirement. Very well deserved. A couple questions from us. First, on select AML, I think in the prepared remarks you said that this initial data will give us some idea of the efficacy of adding TAMI to the combination. Can you talk a bit more about that? What delta between the arms would give you confidence that you are seeing additive efficacy in light of the relatively small patient numbers, and in terms of the control arm and Specifically, I think you said a 66% CR-CRI rate would be expected in the general population. What's the most recent data on what a RARA-positive population would generate for CR-CRI for Veneza?

Okay. Thanks, Bill. I'll take that one. So just to, again, remind everyone who's listening, we're undergoing a randomized trial. All the patients are positive for RARA overexpression. They all have unfit AML. And this represents the very first prospective clinical evaluation of Tamibaratine being used in RARA positive patients in combination with Veneza compared to Veneza. So your question about what we know about the performance of Veneza in RARA positive patients is unknown. And this will be our first data update that gives us initial insights into that. We are very excited that we can look forward to reporting on approximately 20 patients, reminding you it's a randomized one-to-one, so you can expect a relatively equal split across that population. And we're specifically focused on those patients who've enrolled into the randomized portion. So reminding you, this is a group who started enrollment in the first quarter, and here we are in fourth quarter giving you this update. So we're largely focused on the response rates. We focus on our primary endpoint, which is the composite CR rate, the CR-CRI rate. And of course, we'll report on the tolerability. As you mentioned, the venasal response is about 66%. The tamiazal response in this population is about 61% from our prior phase two trial. So we're looking for a response to the triplet that is north of that. We haven't specifically stated exactly how far north we need to be of that. That said, from our prior data last year, the safety leading in a smaller number of patients had an 83% CRR rate, which we were very excited about. And in that case, the tolerability supported advancing to the randomized portion. So that just sort of gives you a sense

as to what it is we're hopeful for as we move into the early December date of the disclosure.

That's very helpful. And then just one question on SelectMDS. It sounds like enrollment completion is now Q124. I think in the past guidance had been year end 23. Is there any reason for that? Were there any unforeseen challenges or is it simply now that enrollment is near completion you can give a more definitive and accurate guidance as to when it's going to complete.

Yeah, I think that the latter is the case. You know, we do our very best over time when a trial initiates, you know, with all kinds of ways to project enrollment rates based on the numbers of sites that are activated and the delivery of the active sites to the trial. And as you get closer and closer to the finish line, the data are more robust in terms of the accuracy of how they lead us to come to our predictions. So now that there's light at the end of the tunnel, I think we're feeling very, very confident that we can project completing the enrollment for the primary endpoint, that 198 patients should be delivered in the first quarter of the year. And since it's just a little different than what we've previously said, we just thought it was appropriate to update that at this time.

Fair enough. Thanks again for taking our questions. And Nancy, congrats again on a great tenure.

Thank you, Phil. Thank you. And there are no further questions at this time. I would like to turn it back to Dr. Nancy Simonian for closing remarks.

Thank you, operator, and thank you, everyone, for joining us today. I am deeply grateful for the opportunity to start up and lead Cirrus over the past 11 years. I am proud of the achievements we've made together and I'm excited about the potential for Temi Baratine to transform the lives of patients. I look forward to Ciros' next chapter on the path to commercialization and continuing my service as a member of the board. Finally, and importantly, I want to express my thanks to you, our investors and analysts, and the entire Ciros team for your support over the years. It truly makes a difference for patients. Thank you.

Thank you, presenters. And ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.