Curis, Inc. (CRIS) Earnings Call Transcript

Good morning, and welcome to the Curis First Quarter 2023 Business Update Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Ms. Diantha Duvall, Curis Chief Financial Officer. Ms. Diantha, please go ahead.

Thank you, and welcome to the Curis First Quarter 2023 Business Update Call. Before we begin, I would like to encourage everyone to go to the Investors section of our website at www.curis.com to find our first quarter 2023 business update release and related financial tables. I would also like to remind everyone that during the call, we will be making forward-looking statements which are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and actual results may differ materially. For additional details, please see our SEC filings. Joining me on today's call are Jim Dentzer, President and Chief Executive Officer; Bob Martell, Chief Scientific Officer; and Jonathan Zung, our newly appointed Chief Development Officer. We will also be available for a question-and-answer period at the end of the call. I'd now like to turn the call over to Jim.

Thank you, Diantha. Good afternoon, everyone, and welcome to Curis' first quarter business update call. This past quarter, we made important progress with our lead clinical candidate, emavusertib. As we mentioned in our March update, we completed enrolling the additional patients requested by FDA ahead of schedule, which we believe is indicative of both the clear unmet need in leukemia and the excitement among the clinical community for this novel agent. We are collecting and analyzing data from these patients this quarter and expect to discuss these data with the FDA in the third quarter. We are optimistic that these data will be sufficient for the FDA to allow us to proceed with a recommended Phase II dose and move into the expansion phase of our TakeAim leukemia study. We're also enrolling patients with primary central nervous system lymphoma, or PCNSL, and treating them with emavusertib in combination with the BTK inhibitor, ibrutinib, in our TakeAim lymphoma study. We believe emavusertib in combination with ibrutinib has the potential to be an important new therapy in PCNSL, which is an orphan population of patients with high unmet need. I'm also pleased to announce the expansion of the Curis executive team with the addition of Dr. Jonathan Zung as our Chief Development Officer. Dr. Zung strengthens our executive team as a well-respected industry leader with a wealth of drug development experience in both biotech and large pharma. In short, the Curis team continues to make significant progress in establishing our lead clinical candidate, emavusertib, showing both clear single-agent activity and broad potential in combination therapy as a potential cornerstone treatment in hematological malignancies. And we look forward to sharing the results of our discussions with FDA in the quarter ahead. With that, I'll turn the call back over to Diantha to review our financial results for the quarter. Diantha?

Thank you, Jim. For the first quarter of 2023, Curis reported a net loss of $11.6 million or $0.12 per share as compared to a net loss of $16.1 million or $0.18 per share for the same period in 2022. Revenues for the first quarter of 2023 were $2.3 million as compared to $2.1 million for the same period in 2022. Research and development expenses were $9.1 million for the first quarter of 2023 as compared to $11.4 million for the same period in 2022. The decrease in research and development expenses for the quarter is primarily attributable to the timing of manufacturing costs and lower employee-related costs due to a reduction in headcount. General and administrative expenses were $4.8 million for the first quarter of 2023 as compared to $5.7 million for the same period in 2022. The decrease in general and administrative expenses was driven primarily by lower employee-related costs due to a reduction in headcount. For the first quarter of 2023, other income net was $0.1 million as compared to other expense net of $1 million for the same period in 2022. Other income expense net primarily consists of interest income, partially offset by expense related to future royalty payments. As of March 30, 2023, Curis' cash, cash equivalents and investments totaled $71.8 million and there were approximately 96.6 million shares of common stock outstanding. We continue to be in a strong cash position and expect that our existing cash, cash equivalents and investments should enable us to maintain our planned operations into '25. With that, I'd like to turn the call -- open the call for questions. Operator?

[Operator Instructions] And our first question will come from Li Watsek with Cantor Fitzgerald.

Jim, just curious, for the 9 additional patients that you enrolled in Q1, do you have a sense how the activity that you've seen so far compares to the higher dose, the 300 mg? And do you have plans to maybe share the data prior to your meeting with the FDA in Q3?

So thank you very much for the question. So we're planning on having the discussion with FDA first and then we'll discuss the data more publicly later. Of course, that's the way the FDA would prefer it, and I think that's the best answer for us at this time. I think what we can tell you that we've said in the past is we answered all of the FDA's questions last year with one exception. And that was we've got 2 doses, 200 milligrams BID and 300 milligrams BID, both of which look safe, both of which have shown responses. And the open question with the FDA is, which is the better of those 2 doses? So our view would be the data we had last year at this time seem to anticipate that both were good, both could lead to responses, both were safe. There seemed to be a slight preference for 300. We have since added more patients at 200 to have a more fulsome analysis between the 2. And my assumption is going to be that when we take these data to the FDA, they're going to look at the data set and come out where we are. And that is both doses are safe, both doses are effective. If there's a preference for 300, that means the data were completely consistent with what we've seen so far. If there's a preference for 200, that means the data at 200 look even better than they did last time. Either of those outcomes is good, and I look forward to walking you through what these data look like after we have the conversation with FDA. Pretty long answer to the question, hope that's helpful.

Okay. Maybe a follow-up -- yes, sure. Maybe a follow-up question. When do you think you might be able to communicate to the Street with respect to the clinical hold after the meeting in Q3? And I guess for this meeting, would you be able to discuss the registrational path with FDA as well?

Yes. I think our plan right now is that we hope to have this discussion with the FDA at the end of Q3. So of course, we would come out with the answer with that as soon as we have it, that we're moving forward. In terms of the next steps, I think we've been pretty clear. In AML, the design -- the precedent for the design is fairly straightforward. We look at IDH1, IDH2, FLT3, all of these studies, pivotal studies were done with a single-arm design with CR/CRh as a primary endpoint, duration of response and survival as secondary endpoints. And we would assume that going forward, the FDA is going to be consistent with their past practice and have a similar design. In MDS, it's a longer discussion. It's both a good and bad thing. The reason why it's a longer discussion is because there is no precedent for relapsed/refractory treatment of MDS, and that's precisely because there are no drugs approved. So the good news in that, of course, is that it's a wide open space. The more uncertain news is, of course, because it's a wide open space and because nothing is approved, it's going to take some dialogue with FDA. As with getting off clinical hold, I look forward to having those discussions with FDA. And of course, the minute we can, we will be very eager to discuss with you.

[Operator Instructions] Our next question will come from Yale Jen with Laidlaw & Company.

My first question is with the 9 patients you already enrolled, is there anything you can talk about the general characteristics of these patients?

So yes, we're going to withhold talking about baseline characteristics and anything else that we're seeing until after we've had the discussion with FDA. We're not going to try and front run the FDA discussions. But what we can say is that what you already know in this population, whether you're looking at relapsed/refractory AML or relapsed/refractory MDS, these patients all have a very poor prognosis. Median survival in the literature is anywhere from 2.3 to 6 months. It's just a very bleak prognosis. So it's fair to say that any patients that have come into the study so far and any patients we're likely to see between now and NDA submission, those are going to be patients that are unfortunately in pretty tough shape.

Understood. I appreciate that, and I respect that as well. You -- also, my follow-up question here is that you mentioned about PCNSL. And could you give us a little bit background how would you start this? And what was the rationale behind it and where things are at this moment and what to anticipate in 6 or 9 months?

So the rationale for going into primary CNS lymphoma, so I can start and then I'll ask Bob to join in. So in general, in lymphoma, you remember we're treating lymphoma in combination with ibrutinib. The logic there is B-cell lymphoma today is treated really to downregulate NF-kappaB activity. And NF-kappaB, in turn, is driven by 2 biologic pathways: the BCR pathway where BTK lives; and the toll-like receptor pathway where IRAK4 lives. What we discovered in our early scientific work that was then corroborated in the lab and then of course later in the clinic, is that if you want to downregulate NF-kappaB activity in these patients, the best thing to do isn't to shut down one pathway or the other, it's to shut down both. So that's the logic behind going down lymphoma in general. And in primary CNS lymphoma in particular, this is a type of cancer where it's particularly sensitive to the toll-like receptor side as opposed to the BCR side. And it's an orphan drug indication so it should mean that we can get to an answer fairly quickly that hopefully works in our favor. And Bob, I don't know if you want to add any more color to that?

Yes. No, I think that was a good explanation. The majority of patients who have primary CNS lymphoma have MYD88 mutations. And sort of just to expand on what Jim said, this is a key driver of IRAK4 and ultimately NF-kappaB activity. And so the disease, the PCNSL disease seems to be weighted more towards the TLR pathway in terms of what's driving the actual disease. Now we have some really interesting data, and there's some nice data published in the literature in particular with CNS lymphoma. For example, we know that in preclinical models, we get excellent exposure of emavusertib in these tumors and crossing the blood-brain barrier as well. So this is a nice feature of emavusertib, in fact, getting levels in these preclinical models that are at therapeutic ranges. That's been demonstrated not only for CNS lymphoma but actually just as an aside for melanoma as well. So we think that this is a great area where there's not a lot of other drugs approved or used. And we think it's a great opportunity for us to capture as a potential early indication.