Verastem, Inc. (VSTM) May 20, 2026 Conference Transcript

RBC Global Healthcare Conference. We've got Veristam, represented by Dan and Dan, Patterson and Lyons, their CEO and Chief Commercial Officer. Thanks for being here.

Happy to be here, and great to have an opportunity for folks to meet Dan, or Dan 2, or you're probably Dan 3, I guess.

Yeah, there's a lot of Dans. It's part of the hiring department. There's a theme.

Yeah, keep it simple. um no great um actually i wanted to start on the g12d program um and you know maybe just to sort of help introduce the story um you guys have somewhat of a unique mechanism with 7375 it's an on-off inhibitor can you just maybe remind us what differentiates the molecule as you've been moving through the clinic sure um so we started a discovery effort with gen fleet you know god we're probably going back four years now.

The intent was to find something first and foremost with good oral bioavailability, because that's been a challenge in this space. These are rather large molecules. We also wanted on-off, and those were the two main criteria. They made a couple hundred molecules. We did a lot of the translational work in animals together with them and chose the lead. One of the things we did find after we chose the molecule that was quite intriguing to us is the residence time on target is quite long. So even though it has a pretty long half-life, it stays on the target even longer. And so when we've talked recently about going above the 600 milligram dose that was chosen in China to the 900, and we've dose cleared that, one of the intriguing things was not only was the AUC greater, so we're seeing better covered, you know, better blood levels. But because of the long residence time, the C-max matters a lot too. And so the C-max went up as well. And so, you know, we think we've got an interesting molecule. It's got all the characteristics that we were looking for. And what we've been seeing in the clinic, you know, first and foremost in China replicated the preclinical profile. And what we're seeing here in the U.S. is really replicating what we saw in China. So we're pretty optimistic about it.

Got it. You know, maybe just on that point, you know, this is a molecule that's been evaluated in two distinct geographic populations. I guess, are there any differences between the U.S. and, you know, Chinese populations in terms of who's been tested for 7.375 and maybe how the development, you know, you mentioned selecting a potentially moving forward with a higher dose than they were able to reach in China. I guess just maybe explain some of those distinctions?

Sure. I mean, when we look at the patient populations, and the two main things we looked at is prior therapies, and the prior therapies seem somewhat very consistent with what we see in the U.S., and then really the mutational burden, if you will, or the different mutations the patients have, they look quite similar. Now, having said that, we can't account for every difference in how they're treated in China and the U.S. And, you know, we look at the Chinese data as really giving us a roadmap. We try and learn as much as we possibly can from the experience in China. But at the end of the day, what's really going to matter is what we see in the U.S. You know, that's what we're going to take to regulators. We're not competing against Genfleet. We're competing against others in the U.S. And, you know, we're very optimistic based on what we've seen to date. There's been a lot of noise in this space. There's been a lot of data sets that have come out, data sets that aren't mature, that are mature. Looking at patient response, patients who've been on at least 14 weeks, unconfirmed, confirmed. At the end of the day, we've got to wait for mature data, which is confirmed responses, PFS and OS, and that's going to be the ultimate arbiter and what the FDA will look at.

Got it. I guess you've shared some amount of updates and qualitative descriptions of what you're seeing in the U.S. As we sort of map that back to what Genfleet saw in China on safety, on efficacy, I mean, should we be rounding our expectations to what we saw in China? Are some of the things you're doing in the U.S. going to maybe improve the profile on safety, on efficacy?

That's a great question. You know, I would say, you know, and we've talked about this because we did put out some preliminary safety data. You know, the biggest side effect that was seen in the patients in China was GI. And I think we're, we know pretty well that the origin of that is really the pills sitting in the gut. It doesn't seem to be a central effect. It seems to be an irritation of the gut with the pills sitting in there. What we've done to mitigate that in the U.S., and it's pretty standard treatment in the U.S., is give prophylactic ondansetron. That seems to have helped, but we also are feeding the patients. They were fasted in China. We've looked at fed and fasted. We haven't seen any differences. We're doing formal food effect studies now, but it seems like both the feeding and the Zofran has had a pretty dramatic effect on the GI side effects. The other thing that was seen a little was diarrhea. And again, that's probably related to irritation in the gut. But what we found in the US, and again, this is pretty standard practice. And we've had previous drugs in the clinic where we've seen the same thing. You tend not to prophylax for diarrhea because you can cause constipation. You don't want to do that. But what happens is as long as you educate the patients that when they have an instance of diarrhea, they immediately take over-the-counter medications. It seems to mitigate it quite well, because what typically happens, you have a patient with cancer. They get some diarrhea. It's irritating. They don't do anything about it. It gets worse. They go into the doctor's office after three or four weeks, and they talk about it. By that time, it's too late, and so it's really about educating the staff and the patients to intervene quickly with the diarrhea, to prophylax for the nausea and vomiting. The other two things that were seen in the Chinese data that we're not seeing in the U.S. was there was some liver toxicity. When we went and looked at the individual patients that had liver toxicity, they were usually explainable things. And, you know, we've talked about this before, and Genfleet showed some data at ESMO that compared their treatment emergent side effects with their treatment-related side effects, and they're almost exactly the same. Chinese investigators tend not to differentiate. And so when we looked at the liver tox, for example, there would be things like a bile duct was blocked and that will make your liver functions go up in the US we would put a stent in to get rid of that blockage before we put them on the trial or there were patients who had tumor involvement of the liver and so we've not seen any liver toxin the US and they did see some level of hematologic toxicity that we're not seeing and so you know we're very comfortable with the profile that we've seen in the US it's allowed us to go to higher doses. We dose cleared 900. We're now looking at 1200, not because that's likely the dose we're going to take forward. But when you put in an NDA, one of the questions they ask is what happens when patients get a higher dose than they should get, you've got to be able to characterize that. And then for Project Optimist, you know, to have a dose that we can go to safely, and then we choose a lower dose that kind of checks the box for that.

Got it. And I guess as you continue to build your US data set, what's the cadence of updates we should expect throughout the year?

No, that's a great question. And we've given some updates recently because sometimes good news impacts timing. And so the fact that we've been able to go to a higher dose means it's going to take a little longer to have a good data set at the go forward dose. And so what we've said is we'll have a data update in June that'll primarily be a much larger safety database. We'll have a much larger number of patients with PK to show that we are actually getting more drug in as we go up. And that's been a challenge with these molecules where a lot of the other molecules have tapped out and not been able to go higher because of the size of the molecules or whatever. And then what we've said is in the second half of the year, we'll have a more fulsome data set at the go-forward dose, and we're talking about having 20 to 30 patients per indication, so that's PDAC, CRC, and long, and that will really give a much better sense of efficacy. I think, again, what's been hard to come, you know, we all do cross-trial comparisons that we shouldn't do, and what's been particularly hard in this RAS space is you get data sets that they mix confirmed and unconfirmed responses. They have an arbitrary cutoff. We're trying to be able to put out really a data set that's interpretable. And that really will be first half of this year will be safety and PK. Second half will be more efficacy that we hope will be very interpretable by the diseases that folks are focusing on.

I guess in parallel to that. You've also been working with the FDA, reaching alignment on what should some of these cohorts look like, thinking about future plans. I think this is oncology and there could be opportunities to move faster. Can you tell us, I guess, the latest status of your regulatory alignment and how you think about a future plan?

Sure. With the one caveat being, with a lot of the leadership changes at the FDA recently in the leadership vacuum. I think, and I've been doing this for 30 years, I think anyone pontificating about what's going to happen at the FDA is probably making stuff up at this point.

We really don't know. I mean, maybe we can almost reframe this as what's your aspiration?

So our aspiration, and again, you know, we do not want to guarantee anyone, we can get accelerated approval. But when we put in an amendment to our phase one study where we upped the three cohorts, so CRC, lung, and PDAC, to 80 to 100 patients, and this wasn't a meeting, we sent in the amendment, we got back a response from the agency that said, if these are going to be registration studies, which is kind of acknowledging what we were doing, then you should break them out as separate phase two protocols that are meant for that purpose. And what that means is there are different subdivisions of the FDA that look at PDAC versus lung. So you can't have one protocol. You need to build in things like blinded independent central review of scans and things that you do for a registration-directed study. So that's the feedback we got. Now what you never get from the agency is, if you do this, you'll get approval. You typically get a no, or you should do this, or it should be a review issue. And it's more in the latter category than the front. We're proceeding that way. Now, we're not naive enough to think that we're guaranteed to get accelerated approval in all three indications. So we will be starting randomized phase threes in the frontline setting that will either serve as the confirmatory study if we get accelerated approval, or in any given indication where we don't do accelerated approval, it would be the approval in frontline. And so we're really trying to do our best to accelerate things, because the one thing I love about being in oncology, you're usually one study away from approval. This isn't about, you know, other diseases where, you know, you've got to do multiple studies and all this. Oncology, good news, can lead to an approval pretty quickly. And what we don't know is what the exact environment will look like when our studies read out. So we get a lot of questions. Well, what if RevMed gets approval in second line, PDAC, are you shut out? We don't think we are. You know, they're going for a pan-rass. This will be a G12D. You know, we learned with our LGSOC indication, you know, that was the first time the FDA broke things out by KRAS status. And so it's all going to be dependent on the data. And if we have very strong data, we think we have a pretty good chance. Now, we think CRC is probably more white space. You know, we think we'll be ahead there with a combination of cetuximab. And the same thing in long, we'll move relatively quickly there. But the plan is to develop early data for potential accelerated approval while at the same time doing the longer-term work to get the frontline approvals.

You sort of touched on this, but I guess how do you see a G12D fitting into the landscape? I mean, is this an agent that you think is best suited for monotherapy or given the safety profile? Is it something that lends itself to combinations?

So, great question. I would say based on the high response rates we've seen in the Chinese data so far, so to remind everybody, in PDAC's second line, it was a 58% response rate, in Lung a 69% response rate. CRC, obviously, we're waiting on the combo study, and we're doing those right now. There's the potential for single agent, both second line and potentially maybe front line, I think the more likely scenario, frontline, in PDAC, it's combination with gemabraxane, which is what everyone's doing. We're also seeing both very compelling preclinical data and early clinical data in PDAC with cetuximab, and that could have a potential for a chemo-free frontline regimen PDAC, which is revolutionary as the RevMed data is to date. we think having a chemo-free regimen without potentially the side effect burden might be really attractive for a good subset of the patients. Long, we're combining with PD-1, you know, kind of the standard approach everyone's taking. And then in CRC, cetuximab in the second and third line setting. So we think we've got a number of paths forward. We do believe that the the G12D-specific molecules have less of a side effect burden because you don't have on-target effects that are beyond that target. So, you know, with a pan-rass, you're hitting skin, you're hitting T-cells, you know, they have stomatitis. We're not seeing any of that. So we think it makes for a potential, you know, pretty tolerable single-agent regimen, but I think points to combinability being easier, if you will, and we're doing all those studies right now.

I think one of the concerns with companies developing RAS inhibitors is the competitive landscape, and you touched on this, but I kind of want to address it head-on. I mean, there's a pan-RAS inhibitor that's hit the stats in a PDAC trial. They're also not the only companies developing allele-specific inhibitors. I guess, how much room is there to fragment this market, I guess, both across, you know, competing against PANS, competing against other allele specifics? Can you talk about that?

Yeah, I mean, the unfortunate thing is there's a lot of room. You know, there's a huge unmet need. You know, I think there's a somewhat of a naive thought that now that the pan-RAS has really great data in PDAC. I mean, the RevMed data is good for the industry. It's good for everybody developing RAS agents. We've proven the target works. It's druggable. It's great for patients. But I think there's room, both from an efficacy front and a tolerability front. And this notion that they somehow have blocked out the sun, I think, is incredibly naive. There's plenty of room. and if you look at PDAC, 40% of the PDAC patients, it's G12D. We as a philosophy don't believe that necessarily combining an isoform specific and a panras is the way to overcome resistance because cancer is pretty smart. It's really the other parallel pathways that I think are going to drive resistance, and we think there's a lot of room. And even though these are different drugs, you can look at the pd1 market btk a bunch of them the first molecule and even g12c for example the first molecules aren't exactly the ones that dominate and so we think there's plenty of room and you know these cancers aren't going away cancer is really smart at evading stuff and we think there's plenty of room um you guys also have a commercial business so i want to pivot to that side of the story.

And, you know, we have the chief commercial officer here as well. So I wanted to bring you into the conversation. Maybe just starting off at a high level, you know, AFAC launch has been ongoing. I guess, how are you feeling about the trend for revenues this year, patient starts?

Yeah, let me hit that really quick and then hand it over to Dan. I wanted to use this opportunity to introduce Dan. We're really glad to have him on board and here about a month now, you know, the first three quarters of the launch, you know, went well. And even Q1, we had growth over Q4. I've characterized it as a miss. It wasn't the kind of growth we wanted. At the same time as we were going through that quarter, we'd done a deep dive on the first six months of the launch and had assessed some things we wanted to change. and then brought in Dan, and I'll let him comment on what he's seen, why he came, and how he feels about 2026.

Sure. Thank you. Thanks for the question, Leo. I think for me coming over, I had spent the last five years in rare oncology and rare tumors launching in this space. I've been here a month, and what I've seen is clearly there has been a bit of a refocus in the last month or so. January was soft. I think we've seen that coming out of our earnings call. We saw good momentum in February, March. And what I see going forward is a clear focus on three things, right? It's getting new patient starts, it's keeping patients on therapy, and it's moving up in line of therapy, which I'll dive into for a second because I think that's really important and that's one of the things that we're really focused on. When a new drug launches in oncology, there's a handful of doctors who actually have experience with this. And learning how to use a drug and finding the opportunities to use it, especially in to grow in a slow-growing tumor like LGSOC, you tend to see use early in patients who really have no other choice. And they generally are not the patients who you see in your clinical trial. And there are patients that are probably going to cycle through therapy a little bit faster. And I think we saw a little bit of that. And I think that as we go forward throughout 2026, we expect this to move up in therapy to be the choice for that first or next recurrence for the drug. Commenting on January. And again, I've been in this space for a while. The oral space is different than the IV space when it comes to January, right? When you think about the way that patients have to go through their maximum out-of-pocket or they have to get re-verified for their insurance, you just see a general slowing down in the oral space, right? I don't think we're the only company that experienced that, right? Especially in your first January after approval. And so, you know, I'm excited about Q2. I think that we're going to see more growth than we saw from Q4 to Q1 and Q1 to Q2. And overall, I've been really impressed with the team. I've been impressed with not only our reimagined recurrent LG SOC campaign, which just launched last week. I've also been very impressed in the investments that we've made in data analytics that are really going to start to pay off. You can't just come out of the gate when you don't have an ICD-10 and find every patient, right? You have to sort of teach yourself and also teach your customers how to find these patients. And I think the team's done a really good job. So I think we've got really strong momentum as we're now at the midpoint in Q2.

And that's actually a good point when you think of sequencing these things. You know, when you go in and educate a physician about a new drug, you're telling them about the drug and the kind of patient they need. But in a disease like LGSFC, and Dan referenced the fact there's no ICD-10, you can't de novo go into a practice and say, let us find all your patients for you. You first have to convince them about the drug. they try it and then the second stage is go back in and say we know you have more patients than you're aware of because there was never a drug for this disease before and so we're going through that second stage now in the larger practices we've come up with algorithms that we run on their electronic medical record to identify the patients smaller practices we do things like chart audits but it's a staged thing you have to convince them about the drug they try it then they work with you to find the rest of the patients, and we're going through that right now.

You talked about moving up in Lyme, but you also mentioned new patient starts and keeping patients on therapy. So I was wondering if you could also elaborate on those. I mean, where in the process of finding new patients are you? Is this about reaching more prescribers? Is this about increasing depth of prescribers? And I guess on the second point, has there been a barrier to keeping patients on therapy that you've identified and you think you can overcome?

Yeah, let me touch on the, I might have to have you remind me on that one. That was a two or three-parter there. You know, in terms of new patient starts, what we've seen is consistency month to month, which is very encouraging. And sometimes in launches, you see some peaks and valleys. We've seen consistency week over week, month over month. So that's been reassuring. In terms of reaching more customers, we added two additional sales reps that just got out in the field the last couple weeks. There were just territories that were very, very large. And as we bring on sort of those data analytics tools Dan and I referenced, you're tending to hunt in the right places more because you know where they are. And so that's been great. So that speaks to your depth question. Like, I do think we're getting wider, but we're also getting deeper in the places where we know there are patients. We've also been able to educate community oncology more. You have to go through the year in the forums where you can reach as many as possible. And we've seen a really strong response from community oncology in terms of saying this makes sense for us. You know, when I, before I joined, when I, when I looked at MAPE, Faxinja, this reminded me a lot of drugs I've worked on in the past where when they have the patient, this is the choice. We just have to help them find the patient, right? This is going to be for the first or next recurrence. This is an oral treatment. It's the only approved in this space. And so, you know, that gave me a lot of confidence is that if we can make sure that we are fishing where the fish are and there's awareness, we're going to have success with this. And was there a third part of your question? Yeah, there wasn't.

It was very long. I guess the third part was on patient compliance and persist.

Yeah, so there's two things, right, to that. And Dan, please jump in as well. One is this is a new drug. And usually with oncology drugs, when a patient experiences side effects, you tend to pause and then reduce the dose, right? What you see with that MAPG effect, Sinjikopak, is that patients tend to get their side effects up front, and then the drug starts working. But in our label, patients need to come back to their starting dose if they do have a brief pause. And so that is just part of teaching practices, not just the doctor, but the entire staff how to treat this patient. And that's the work that the team is focused on in those three priorities I laid out. We're also not just in the commercial side, but we have a wonderful medical affairs, MSL, oncology nurse educator team that we are dispatching in the places where that education needs to be reinforced. And so I think that while there's a learning, I wouldn't call it challenges, there's learning how to use the drug. But once you have that in place in a patient treatment plan, in a drug treatment plan, these are all incorporated. And so we think that if we teach them once or twice, it'll stick.

No, I was going to say, this is really a key education point for the physicians, because the first thing is you educate on the drug and they should use it. And they don't pay attention to the rest until they actually use it and experience it. then the second part that we're doing and this is where the leakage happens that we we can really educate to to shut that down where with chemotherapy drugs if you get a side effect it gets worse over time and so they may prematurely come off the drug and then you educate with our drug you see an attenuation over time and as dan referenced we in our clinical trial restart at full dose and we need to make sure they're doing that and then make sure they're sticking with it. And that's just an education challenge and we're doing that now.

Well, this has been great. Unfortunately, we're out of time, but really appreciate having you guys.

Hey, appreciate it. Glad to be here.