Kura Oncology, Inc. Q1 FY2022 Earnings Call

Good day and welcome to the Kura Oncology First-Quarter 2022 Earnings Conference Call. All participants will be in listen-only mode. Please note this event is being recorded. I would now like to turn the conference over to Mr. Pete De Spain, Senior Vice President of Investor Relations. Please go ahead.

Great, thank you. Good afternoon and welcome to Kura Oncology’s first-quarter 2022 conference call. Joining me on the call are Dr. Troy Wilson, our President and Chief Executive Officer, and Tom Doyle, our Senior Vice President of Finance and Accounting. Dr. Stephen Dale, our Chief Medical Officer, is also with us and available to answer questions. Before I turn the call over to Dr. Wilson, I would like to remind you that today's call will include forward-looking statements based on current expectations. Such statements represent management's judgment as of today and may involve risks and uncertainties that could cause actual results to differ materially from expected results. Please refer to Kura's filings with the SEC for information concerning risk factors that could affect the company. With that, I'll now turn the call over to Troy.

Thank you, Pete. And thank you all for joining us this afternoon. Despite what continues to be a challenging broader market environment, we operate from a position of strength here at Kura, armed with three independent drug development programs, a strong experienced team, a well-designed clinical development strategy, and a cash runway through 2024. Now, as we approach a series of important catalysts driven by completion of enrollment in the Phase 1b study of our Menin Inhibitor, Ziftomenib, culminating in top-line data next quarter and a full data presentation in the fourth quarter. I'm pleased to report that we recently completed enrollment of the patients in the Phase 1b portion of KOMET -001, required to identify a recommended Phase 2 dose for Ziftomenib. The study was designed to enroll two expansion cohorts, 200 milligrams and 600 milligrams, with each cohort comprised of patients with NPM1 mutant or KMT2A rearranged, relapsed or refractory acute myeloid leukemia. The goal of the Phase 1b is dose optimization, consistent with FDA's guidance around project optimist. We are now assessing the patients in each expansion cohort for safety, tolerability, pharmacokinetics and exposure, as well as efficacy. We remain on track to identify the recommended Phase 2 dose for Ziftomenib, and to report top-line data from the Phase 1B study in the third quarter, with a more complete dataset from KOMET -001 reserved for presentation at a medical meeting in the fourth quarter. The study protocol gives us flexibility to enroll additional patients in the Phase 1B, enabling us to maintain momentum while transitioning into a subsequent Phase 2 registration directed portion of KOMET -001. We believe data from all patients treated at the recommended Phase 2 dose will have potential to contribute to the registration on patient population. Meanwhile, we remain enthusiastic about the encouraging safety profile, tolerability, and clinical activity we're observing in the Phase 1B study. As we continue to add sites in the U.S. and Europe in anticipation of the subsequent Phase 2 portion of the KOMET -001 study, we also intend to conduct a comprehensive development strategy that builds upon the potential to register Ziftomenib as a monotherapy while giving us flexibility to access larger opportunities through combinations in earlier lines. We look forward to sharing much more regarding our global development strategy for Ziftomenib later this year. Following identification of the recommended Phase 2 dose. Now let's turn our attention to our Farnesyl Transferase Inhibitor programs. We view Farnesyl Transferase Inhibition as a potentially valuable therapeutic and commercial franchise, one with potential to deliver multiple opportunities in oncology. One of the first examples of the use of FTIs as a targeted therapy was the demonstration of the potential for Tipifarnib to drive durable responses in recurrent and metastatic HRAS mutant head and neck squamous cell carcinoma, and our ongoing NHN registration directed trial continues in that indication. More recently, we've begun efforts to build upon the initial monotherapy activity of Tipifarnib with two goals: to drive deeper and more durable responses, and to expand the potential patient population. Toward this end, we're pursuing the current HN trial to evaluate the combination of Tipifarnib and Alpelisib, an inhibitor of PI3 kinase alpha in selected HNSCC patient cohorts. By combining Tipifarnib and Alpelisib, we believe we can achieve both goals. Our preclinical data suggests the combination has potential to provide meaningfully better antitumor activity relative to inhibiting either target alone by targeting both PIK3CA and HRAS dysregulated HNSCC. In December, we dosed the first patient in our Phase 1-2 current HN trial of Tipifarnib in combination with Alpelisib in HNSCC. The initial cohort includes patients who have PIK3CA dependent HNSCC. Screening has commenced in an HRAS over-expression cohort, and we expect to dose the first patient in this cohort by the third quarter. Our goal with the current HN trial is to identify a recommended Phase 2 dose and schedule for the combination, and look for early signs of clinical activity. Our team is making excellent progress and we look forward to providing an update. Beyond HNSCC, we're beginning to understand that FTIs may represent an ideal combination partner for certain classes of targeted therapy in large solid tumor indications. The first of these emerging combination opportunities was highlighted last month in a late-breaking presentation at the American Association for Cancer Research Annual Meeting in New Orleans. The new findings were generated through a collaboration with INSERM, the French National Institute of Health and Medical Research. The presentation featured pre-clinical data supporting the potential for Tipifarnib to prevent the emergence of resistance to Osimertinib in EGFR mutant non-small cell lung cancer. Several farnesylated targets were identified that appear to control the ability of lung cancer tumor cells to enter and exit a state that makes them tolerant to Osimertinib using preclinical and in vivo models of EGFR mutated lung tumors. Core treatment with Tipifarnib durably prevented relapse to Osimertinib for up to six months with no evidence of toxicity. Collectively, these data strongly support the potential use of an FTI to prevent or delay the adaptive response to Osimertinib. We're preparing to initiate a Phase 1 study of Tipifarnib in combination with Osimertinib in treatment naive, locally advanced, and/or metastatic EGFR mutated non-small cell lung cancer. We expect to dose the first patient in that study, which we call the current lung trial in the third quarter. We intend to perform initial clinical evaluation with Tipifarnib or Osimertinib while in parallel advancing KO-2806, the lead development candidate in our next-generation FTI program through IND enabling studies. We remain on track to submit an IND application for KO-2806 in the fourth quarter. With that, I'll now turn the call over to Tom for a discussion of our financial results.

Thank you, Troy. Good afternoon, everyone. I'm happy to provide a brief overview of our financial results for the first quarter 2022. Research and development expenses for the first quarter 2022 were $20.9 million compared to $20.3 million for the first quarter of 2021. The increase in R&D expenses was primarily due to the increase in Ziftomenib clinical trial and personnel costs. General and administrative expenses for the first quarter of 2022 were $11.9 million compared to $10.6 million for the first quarter of 2021. The increase in G&A expenses was primarily due to the increase in professional fees and non-cash share-based compensation. The net loss for the first quarter of 2022 was $32.5 million compared to a net loss of $30.7 million for the first quarter of 2021. This included non-cash share-based compensation expense of $6.7 million compared to $5.1 million for the same periods in 2021. As of March 31, 2022, we had cash, cash equivalents, and short-term investments of $480.1 million compared to $518 million as of December 31, 2021. Based on our current plans, we believe that our cash, cash equivalents and short-term investments will fund current operations through 2024. With that, I now turn the call back over to Troy.

Thank you, Tom. Before we jump into the question-and-answer session, let me just lay out our anticipated milestones for 2022. For our Menin Inhibitor program, we aim to identify the recommended Phase 2 dose of Ziftomenib and report top-line data from the Phase 1b study in the third quarter, as well as present updated data from KOMET -001 at a medical meeting in the fourth quarter. For our FTI programs, we plan to dose the first patient in the HRAS over-expression cohort of current HN in the third quarter, dose the first patient in the current lung trial in the third quarter, and submit an IND application for KO-2806 in the fourth quarter. With that, Operator, we're now ready for questions.

We now begin the question-and-answer session. At this time, we'll pause momentarily to assemble our roster. First question comes from Jonathan Chang from SVB Securities. Please go ahead.

Hi, guys. Thanks for taking my questions. First question on Ziftomenib. Can you please refresh our memory as to what investors can expect in the top line third quarter data versus the medical meeting presentation in the fourth quarter?

Sure, Jonathan, thanks for the question. The focus of the top-line data will be around the safety, tolerability, and clinical activity at the recommended Phase 2 dose, with particular focus on the CR rates in the patients that were enrolled in the dose that we've identified as the recommended Phase 2 dose. That's what you should look for in the top-line data. The data for the medical meeting will be much more comprehensive, with the breakdown between the specific genetic subtypes, more detail around both safety and tolerability as well as efficacy, and potentially specific anecdotes around interesting patients. The top-line is really intended, as we've guided consistently, to communicate that we've identified the recommended Phase 2 dose and to inform investors that we continue along the path toward what we believe will be the start and ultimately the execution of a successful Phase 2.

Got it, thank you. And second question, can you provide any color on how many patients in the cohorts have the NPM1 mutation versus KMT2A rearrangement?

Yes, it's a good question, Jonathan, and thank you for it. I can tell you we see a pretty good balance between the two populations. I will hold off on the specific numbers until we get to the data presentation in the fourth quarter. But suffice it to say, we didn't see disproportionate enrollment to one genetic subtype or the other, and we have confidence that we think there's going to be one recommended Phase 2 dose to treat both patient populations. We are seeing promising observations in both populations.

Great. Thank you. Thanks for taking the questions.

Sure. Thank you.

Our next question comes from Peter Lawson of Barclays. Please go ahead.

Thanks so much, Troy. First question is just around safety. How much safety data will we see in the third quarter update, and have you seen any further cases of differentiation syndrome? How is the management strategy going with that?

Thank you, Peter, for the questions. Given that it's going to be a top-line cut of the data, we’ll probably provide some color around safety and tolerability. I can tell you that what we've seen thus far is that Ziftomenib appears to have a very encouraging safety and tolerability profile. Regarding differentiation syndrome, we continue to see it, but we now have what we believe to be a very robust and enhanced mitigation strategy, and it seems to be effective. Neither we nor the investigators run away from differentiation syndrome; to the contrary, it's usually an indication of clinical activity. The key is managing it effectively and keeping patients safe, and the strategy seems to be doing just that. We'll provide high-level color around this in the top-line release with more data to follow.

Thanks so much.

Thank you, Peter.

Our next question comes from Tiago Fauth of Crédit Suisse. Please go ahead.

Hi, guys. Thanks for taking my question. So we already know a lot about the differentiation between Ziftomenib and other Menin Inhibitors you are frequently compared to, but they are not several other Menin Inhibitor trials running. So, is there anything you could say about the relative differentiation between those programs or anything preclinically or from the standpoint of trial design?

Yeah, Jonathan. I’m going to defer addressing our competitors. I'll let them speak to their data. However, looking back, the Phase 1B design for which we've just completed enrollment was viewed as a delay. However, it has provided us significant experience at two different doses, including our recommended Phase 2 dose. This transition from Phase 1B to Phase 2 gives a solid understanding of the safety, tolerability, pharmacokinetics, exposure, and efficacy at the recommended Phase 2 dose, which positions Ziftomenib competitively.

Helpful. Thank you.

Sure.

Our next question comes from Roger Song of Jefferies. Please go ahead.

Great question. Can you comment on the regulatory interaction? Have you discussed with the FDA about your RP2D plan and when you will discuss the pivotal?

Yes, Roger. I want to be careful here on specifics. We interact with the agency regularly across all of our programs. It is significant that we've completed enrollment of the 24 patients needed for Phase 1b. We are in the process of collecting and analyzing that data to identify the recommended Phase 2 dose. That requires a package to be submitted to the FDA, which hasn't happened yet. But the team knows what to do and is very focused on it.

Got it. Can you remind us about the Tipifarnib, this combo trial, where are you at the monotherapy period of study, and how are you going to stretch this combo versus monotherapy moving forward?

The enrollment in AIM, the monotherapy study for Tipifarnib in HRAS mutant head and neck, continues. We know the drug is active, but many of the patients have undergone both platinum and IO, making them unfit for the study. This reality is what the team is managing. The current trial addresses this challenge by combining Alpelisib and Tipifarnib, expanding the potential population and improving screening approaches. The preclinical data supports significant synergy in targeted populations, and we will manage the development streams carefully.

Great. Thanks so much.

Thank you.

Our next question comes from Reni Benjamin of JMP Securities. Go ahead.

Hey, good afternoon, guys, thanks for taking the questions. Maybe just starting off with Ziftomenib. I think, in the past we've talked about the potential combination studies that you were looking into. As you progress, have there been any changes to your thoughts, or are you still looking at potential partners for combinations?

Yes, combinations are of high interest to us. Ultimately, that's probably going to be the highest and best use for Menin Inhibitors. We remain committed to the monotherapy registration, but treatment paradigms for AML will involve combinations. We are moving toward the goal of identifying the recommended Phase 2 dose, and supporting combination studies are ongoing in the background for both frontline and earlier lines of therapy. In terms of prioritization, Venetoclax continues to be an attractive combination partner due to evidence of potential synergy. We are looking forward to sharing more about our development strategy as we get closer to our upcoming announcements.

Perfect. Just switching gears to Tipifarnib, the current HN study in combination. You're going to be starting enrollment of the HRAS overexpression cohort. What is the rationale behind that cohort?

There are at least two populations in that current trial related to farnesylated targets. One is HRAS overexpression and the other is related to rev farnesylation, which serves as a bypass mechanism for PI3 kinase inhibitors. This cohort is significant as it revolves around addressing resistance mechanisms. Removing HRAS, which is harmful even when not mutated, plays a key role in our strategy.

My final question is regarding the current lung trial. What might be the go/no-go decision metrics that you'll be looking at?

The mechanism of action is now well understood, where a population of drug-tolerant cells emerge when treated with Osimertinib. The trial aims to block their entry and exit from that state, preventing them from adapting and conferring resistance. The primary endpoint will be progression-free survival, but we will look at multiple metrics, as osimertinib has high activity as a monotherapy. If we see confirmation of what we observed preclinically, it would mean that patients could stay on Osimertinib longer, enhancing their quality of life.

You definitely have. Thank you very much for backing it up so nicely. Have a good one.

Sure. Thanks, Ren.

At this time our next question will come from Eva Privitera of Cowen. Please go ahead.

Thanks for taking our questions and congrats on completing the enrollment. What was the severity and at what dose have you seen additional cases of differentiation syndrome?

Yes. Thanks, Eva, for the question. At least in our experience, there doesn’t appear to be a dose-dependent issue regarding differentiation syndrome. The extent and severity seem to be patient-specific. Our enhanced mitigation strategy allows physicians to manage differentiation syndrome. Seeing differentiation syndrome often correlates with clinical activity. We'll provide a more detailed discussion on this during the top-line release.

Just to confirm, the top-line data and the nomination of the RP2D will be disclosed together at the same time?

Yes, that is correct.

Can we expect any new PKPD data along with RP2D disclosure?

I don't expect to provide new PKPD data, as we want to protect the integrity of the dataset for the eventual presentation at a medical meeting. What matters is the continued safety and tolerability, which it does, as well as seeing a level of clinical efficacy that gives confidence in a successful Phase 2.

Got it. Thank you so much.

Thank you.

That concludes our question-and-answer session. At this time, let's turn the conference back over to Mr. Troy Wilson for any closing remarks.

Thank you, Operator. Thank you all once again for joining our call today. We'll be participating in several upcoming investor conferences, and we look forward to seeing many of you there. In the meantime, if you have any additional questions, please feel free to contact Pete, Tom, or me. Thank you again, and have a good evening, everyone.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.