Curis, Inc. (CRIS) Q3 2022 Earnings Name Transcript

Curis, Inc. (NASDAQ:CRIS) Q3 2022 Earnings Convention Name November 9, 2022 4:30 PM ET

Firm Contributors

Craig West – Vice President-Investor Relations and Company Communications

Jim Dentzer – President and Chief Govt Officer

Diantha Duvall – Chief Monetary Officer

Convention Name Contributors

Ed White – H.C. Wainwright

Soumit Roy – Jones Analysis

Li Watsek – Cantor Fitzgerald

Operator

Good afternoon, and welcome to Curis’ Third Quarter 2022 Enterprise Replace Name. All contributors shall be in listen-only mode. [Operator Instructions] After the corporate’s ready remarks, name contributors can have a chance to ask questions. [Operator Instructions] Please be aware, this occasion is being recorded.

I’d now like to show the convention over to Curis’ Vice President of Investor Relations and Company Communications, Craig West. Please go forward.

Craig West

Thanks, and welcome to Curis’ third quarter 2022 enterprise replace name. Earlier than we start, I wish to encourage everybody to go to the Traders part of our web site at www.curis.com to search out our third quarter 2022 earnings launch and associated monetary tables.

I’d additionally wish to remind everybody that through the name, we shall be making forward-looking statements that are based mostly on our present expectations and beliefs. These statements are topic to sure dangers and uncertainties, and precise outcomes could differ materially. For added particulars, please see our SEC filings.

Becoming a member of me on at present’s name are Jim Dentzer, President and Chief Govt Officer; Diantha Duvall, Chief Monetary Officer; and Bob Martell, Head of R&D. We may even be obtainable for a question-and-answer interval on the finish of the decision.

I might now like to show the decision over to Jim.

Jim Dentzer

Thanks, Craig. Good afternoon, everybody, and welcome to Curis’ third quarter enterprise replace name. Each day, we try to develop the next-generation of first-in-class most cancers therapies that meaningfully enhance and prolong sufferers’ lives. Earlier at present, we introduced that based mostly on new information we’ve acquired in our TakeAim Leukemia research, we have made the choice to focus the corporate’s assets on accelerating the trail of bringing emavusertib to sufferers.

This give attention to emavusertib and the corresponding deprioritization of our different applications will allow a discount of roughly 30{702b3e23bee4a2ea2d927dcfcd3d484d470fba472fc2bd09b3257ae4868cc71a} of the corporate’s workforce and is anticipated to increase the corporate’s money runway into 2025.

At the moment, I might wish to acknowledge that whereas we’re excited in regards to the heightened focus of emavusertib, we perceive the influence of deprioritizing our different applications has on our valued colleagues and buddies who labored on them. We’re grateful for all of their onerous work and we want them nicely as they pursue new alternatives.

Let me flip now to debate emavusertib and the event actions occurring to drive this essential asset ahead, beginning with our latest accomplishments. In the course of the quarter, we had been happy to announce that the FDA has accredited the reopening of enrollment in our TakeAim research in Leukemia and Lymphoma. Additionally within the quarter, we sponsored the primary annual symposium on IRAK4. This occasion introduced collectively educational and business specialists to debate the newest groundbreaking analysis in IRAK4. The occasion was nicely attended, informative and admittedly, it was a variety of enjoyable to listen to about all the nice work occurring on this essential reply – space of most cancers biology.

We had been honored to make the occasion doable and to host so lots of the good pioneers advancing the science of IRAK4. This coming quarter, we’ll be releasing new information in our TakeAim Leukemia research of emavusertib on the sixty fourth Annual Assembly of the American Society of Hematology in New Orleans. These information will embrace 11 further sufferers handled with monotherapy in our focused populations, these sufferers whose illness harbors FLT3 or spliceosome mutations. These 11 new sufferers convey the whole variety of sufferers with focused mutations to 24.

As a lot of you realize, there are at the moment no medication accredited for relapsed/refractory AML or MDS sufferers submit therapy with HMA. The one revealed information obtainable for the submit HMA setting are for MDS sufferers handled with chemotherapy, the place in 8{702b3e23bee4a2ea2d927dcfcd3d484d470fba472fc2bd09b3257ae4868cc71a} ORR was noticed. We’re very excited to be growing what we hope shall be a game-changing remedy for sufferers who face such a big unmet want.

As a reminder, emavusertib is at the moment being evaluated in three separate medical research. First, the TakeAim Leukemia research, a Section 1/2 research with each monotherapy and mixture arms for sufferers with relapsed or refractory acute myeloid leukemia or AML, and high-risk myelodysplastic syndromes or MDS. The TakeAim Lymphoma research, a Section 1/2 mixture research with ibrutinib for sufferers with relapsed or refractory NHL and different hematologic malignancies; and third, the Section 2 LUCAS research evaluating emavusertib in sufferers with decrease danger MDS.

The TakeAim Leukemia research is open for enrollment in monotherapy on the 200-milligram dose degree. We plan to enroll no less than 9 extra sufferers at this dose and talk about information from these sufferers with FDA. Offered we acquired the company’s settlement in these discussions. We plan to reopen enrollment within the research’s growth arm in addition to in a mix arm, investigating emavusertib with azacitidine or venetoclax.

Staying with leukemia and MDS for a second. We consider that the LUCAS research in lower-risk MDS might have an information readout within the first half of 2023. Recall that the LUCAS research is an investigator-sponsored research led by Dr. Uwe Platzbecker, Chairman of EHA’s Scientific Working Group on MDS. We’re excited to see what emavusertib exhibits on this research as splices on mutations are among the many most distinguished mutations in lower-risk MDS.

In an thrilling new and more moderen growth, we be aware that Curis shall be presenting at SITC proper right here in Boston later this week. This presentation will spotlight an investigation of the immune modulation that happens with IRAK4 inhibition in myeloma mind metastases. That is yet one more instance of the colourful degree of scientific analysis occurring round IRAK4 and demonstrates that emavusertib’s potential fairly probably extends to strong tumors in addition to leukemia and lymphoma.

In abstract, progress this quarter is highlighted by receiving FDA approval to reopen enrollment in each of the TakeAim research, convening the primary IRAK4 symposium, asserting the discharge of recent medical information at ASH, and asserting the extension of the corporate’s money runway an extra yr into 2025. It has been an eventful quarter, and we stay up for offering essential updates on emavusertib at SITC, ASH and at different occasions within the weeks and months forward.

With that, I’ll flip the decision over to Diantha to evaluate our monetary outcomes for the quarter. Diantha?

Diantha Duvall

Thanks, Jim. Curis at present has a robust basis, each operationally and financially to permit us to focus on emavusertib growth.

For the third quarter of 2022, Curis reported a internet lack of $13.3 million or $0.14 per share as in comparison with a internet lack of $11.1 million or $0.12 per share for a similar interval in 2021. Curis reported a internet lack of $45.3 million or $0.49 per share for the 9 months ended September 30, 2022, as in comparison with a internet lack of $31.8 million or $0.35 per share for a similar interval in 2021.

Revenues for the third quarter of 2022 and 2021 had been $2.8 million and $3 million, respectively. Revenues for the 9 months ended September 30, 2022 and September 30, 2021, had been $7.3 million and $7.5 million, respectively.

Working bills for the third quarter of 2022 had been $15.4 million as in comparison with $13.1 million for a similar interval in 2021. Working bills for the 9 months ended September 30, 2022, had been $50.1 million as in comparison with $37 million for a similar interval in 2021 and consists of the next: Value of royalty revenues, which is comprised of quantities as a result of third-party college patent licensors in reference to Genentech and Roche’s Erivedge internet gross sales had been $0.1 million for the third quarter of 2022 as in comparison with $0.2 million for a similar interval in 2021. Value of royalty revenues for the 9 months ended September 30, 2022, had been $0.2 million as in comparison with $0.4 million for a similar interval in 2021.

Analysis and growth bills had been $10.8 million for the third quarter of 2022 as in comparison with $8.6 million for a similar interval in 2021. The rise in analysis and growth bills for the quarter is primarily attributable to elevated personnel and consulting prices, partially offset by decreased manufacturing and medical growth prices. Analysis and growth bills had been $34.6 million for the 9 months ended September 30, 2022, as in comparison with $24.1 million for a similar interval in 2021.

Common and administrative bills had been $4.6 million for the third quarter ended September 30, 2022, as in comparison with $4.3 million for a similar interval in 2021. The rise normally and administrative bills was partially – was pushed primarily by the timing of prices. Common and administrative bills had been $15.3 million for the 9 months ended September 30, 2022, as in comparison with $12.5 million for a similar interval in 2021.

For the third quarter of 2022 and 2021, whole different expense was $0.7 million and $1 million, respectively. Different expense primarily consisted of imputed curiosity associated to the longer term royalty funds partially offset by curiosity revenue. Different expense was $2.5 million for the 9 months ended September 30, 2022, as in comparison with $2.3 million for a similar interval in 2021.

As of September 30, 2022, Curis’ money, money equivalents and investments totaled $98.7 million, and there have been roughly 96.4 million shares of frequent inventory excellent. We’re in a robust money place and anticipate that our present money, money equivalents and investments ought to allow us to take care of our deliberate operations into 2025.

With that, I’d wish to open the decision for questions. Operator?

Query-and-Reply Session

Operator

[Operator Instructions] Our first query is from Ed White with H.C. Wainwright. Please go forward.

Ed White

Good afternoon. Thanks for taking my questions. A few questions on the headcount discount. So is the influence going to be felt extra within the G&A or the R&D expense line? And will we be seeing the influence beginning within the fourth quarter? Or is that this going to be actually a 2023 occasion for the influence on bills?

Jim Dentzer

Sure. Thanks, Ed. First, thanks for taking the query. So the influence is admittedly – it’s throughout the corporate. And it’s each G&A and R&D. Clearly, it begins with every little thing that’s in a roundabout way associated to emavusertib. So we’re completely concentrating all of our assets in direction of emavusertib and due to this fact, something that wasn’t straight associated was one thing that we might reside with out. And if we might reside with out it and that prolonged our money runway with out having to do the rest, I imply that is the luxurious of beginning with such a robust steadiness sheet that we’ve this flexibility.

However with these information in it turns into more and more clear that it is a drop and this must get to NDA submission with haste. So we’re going to dedicate and redouble all of our efforts to make that occur and insulate ourselves from the necessity to increase cash within the meantime. So sure, broad-based throughout G&A and R&D, there shall be some influence in This fall. But it surely’s actually as you look out over the complete two-year interval that follows that you simply’ll see that money runway influence.

Ed White

Okay. Thanks, Jim. After which on – I’m simply curious with the VISTA program, will we be seeing extra information from 8993? What’s going to occur to sufferers which can be at the moment enrolled, if there are any? And is – are you this as simply halting this system for now? Or is that this one thing that you simply would possibly wish to accomplice or out-license for another person to convey ahead?

Jim Dentzer

Sure. I feel that is as extra of a pause of suspension of exercise. We’re not enrolling new sufferers in that research. As you realize, we love the VISTA goal. I feel it’s unbelievable. However in a world the place you’ve bought two applications within the clinic, and certainly one of them has actually not simply confirmed information that it exhibits it really works constantly from idea to lab to clinic, however you now have a brand new batch of medical information that exhibits you’ve bought a watch to NDA. After which the opposite program remains to be in dose escalation. For those who can’t afford to do each, boy, the choice is evident, you go together with the one which’s bought the confirmed information. So I really like VISTA as a goal, however we have to take the hassle and the cash and the folks which can be devoted to that program proper now and be laser-focused on emavusertib.

Ed White

Okay. That is sensible. Thanks for taking my questions.

Jim Dentzer

Positive. Thanks.

Operator

The subsequent query is from Soumit Roy with Jones Analysis. Please go forward.

Soumit Roy

Hello, everybody. Congrats on all of the progress. A fast one on the anticipated ASH information from the monotherapy and the combo arm. May you give us any coloration on what sort of length of drug these sufferers shall be simply 28 days or somewhat longer than that because you simply began enrolling?

Jim Dentzer

Sure. So it’s somewhat longer than that. And it consists of information for some sufferers. As it’s possible you’ll keep in mind, we had been placed on medical maintain final spring. So we had some sufferers that had simply began the research earlier than the FDA halted enrollment of recent sufferers. So we’ve bought the info is expounded to these sufferers incrementally. I do suppose, clearly, it’s a big add to the info set. It’s virtually doubling the variety of sufferers we’ve bought with the focused mutation. So I feel it’s a really significant replace and actually wanting ahead to speaking in regards to the outcomes of how these sufferers are doing once we get to ASH.

Soumit Roy

The venetoclax combo that began just lately, proper, there?

Jim Dentzer

Nicely, that began once more earlier than the FDA maintain. So any sufferers that had been began – for those who dose drug for sake of argument, 24 hours earlier than the maintain got here in, you stayed on drug. The FDA didn’t ask us to take folks off drug. They only stated, don’t put extra on. So we had already began placing sufferers on mixture remedy. As you possibly can think about, investigators are actually enthusiastic about combo remedy and monotherapy with this program. And so anyone that was – that began the research shortly earlier than the FDA instructed us to cease including new ones, was capable of keep on research, and we’ve bought 5 of these sufferers that we’re going to speak about at ASH.

Soumit Roy

Okay. That’s actually useful. And one final query. For those who can present any coloration, like what are you seeing these new sufferers are being extra spliceosome mutant affected person? Or are you seeing extra FLT3 mutant affected person getting enrolled?

Jim Dentzer

Sure. So I wish to be somewhat cautious about saying an excessive amount of in regards to the information earlier than we get to ASH. I’d simply say that, look, we’re actually enthusiastic about this program. That is the primary new goal recognized in AML and MDS in years. And never solely is it the latest goal, however coincidentally, it’s the most important goal. It seems to be like each affected person or just about each affected person throughout the spectrum of AML and MDS over expresses that long-life type of IRAK4 and no less than half the inhabitants has a really heavy over expression of that kinase.

So we anticipate that the thrill goes to proceed. So long as the info keep constant, idea to lab to clinic that you probably have plenty of IRAK4 lengthy, monotherapy needs to be adequate to knock it down and knock it down onerous. And you probably have somewhat little bit of IRAK4 out, it’s nonetheless a driver of illness. It’s merely not the one driver of illness. These would be the sufferers that profit from combo remedy.

So we’re going to see that as we transfer from idea to the lab, the info had been actually constant and enticing, now that we’ve doubled the info set in our focused inhabitants, have we been capable of keep that degree of consistency within the information and will the thrill be constructing, not simply on the firm and amongst traders, however frankly, amongst physicians and sufferers. That is what we’re keen to speak about once we get to ASH.

Soumit Roy

Okay, thanks for taking the questions.

Operator

[Operator Instructions] The subsequent query is from Li Watsek with Cantor Fitzgerald. Please go forward.

Li Watsek

Hello, thanks for taking my questions. So a fast one on ASH, for the 11 further enrolled sufferers. By the point of the presentation, might you give us a way of what number of you’d have the ability to get a possible efficacy learn on? I do know it is somewhat early.

Jim Dentzer

Sure, we’ll – thanks, Li, first for the query. We’ll be speaking about efficacy for all 11 sufferers. So we’ll be an efficacy pool of 24 sufferers with a focused mutation. So clearly, we think about this a big and significant replace. And as I stated, we’re actually enthusiastic about doing it. Keep tuned.

Li Watsek

Nice. Thanks. And only one follow-up. When do you suppose you’d doubtlessly have the ability to return to the FDA with these new affected person information after which talk about the following steps for AML?

Jim Dentzer

Sure. It is an excellent query. So let’s step again in time, simply as a reminder, when the FDA put us on maintain within the spring, they’d three elementary questions. The primary one was there was a affected person who died they usually needed to be sure that, that wasn’t a difficulty with the drug or the research in any method.

After which second, they knew that we had an early sign, it was uncommon, however a sign in CPK elevation in rhabdo. They needed to be sure that wasn’t an issue within the index affected person, within the affected person loss of life or in some other sufferers, be sure that they did not want to vary our protocol in any method. Are we figuring out and managing CPK elevation in rhabdo appropriately.

After which third, they requested us about dose, Mission Optimus, which dose is the suitable dose taking the advisable Section 2? So we had been in a position, over the course of the summer time. We stated this to start with, and I am glad, after all, to have the ability to say now that it labored out that method. The FDA was going to get comfy as we had been as they realized extra in regards to the affected person loss of life that it is a affected person with relapsed/refractory AML who had a life expectation of two.3 months within the literature. That affected person died in month 9.

Our view can be that affected person – the query should not be, why did the affected person die? The query needs to be, how did that affected person get to month 9? And the reply is, after all, the drug. The affected person ultimately did progress and the FDA, after all, bought comfy with that as they reviewed extra information.

The second query was on CPK elevation in rhabdo. We do know it’s uncommon to see it in our research, however we do see it. We do know that our drug can exacerbate a CPK elevation in some sufferers. We do know that there are confounding elements and we had been capable of establish them within the information with FDA.

For those who’re on a statin, for those who’re on a fibrate, for those who’re a heavy exerciser, you will notice CPK elevation, however when you realize precisely what to search for, the protocol has actually good language for figuring out it, coaching the sufferers doing blood attracts to see if there’s a CPK elevation and the procedures are within the protocol for managing successfully, and we did not have any sufferers have renal complication, which was clearly terrific.

The FDA reviewed all of our procedures and all of our information and naturally, bought comfy with that as nicely. It was the final query on dose and that is actually attending to reply your query straight, that the FDA was capable of give attention to probably the most and would contain a lot of the dialogue.

Within the context of Mission Optimus, the place the FDA needs to know and be concerned by which dose strikes ahead in drug research. Emavusertib represents a perfect drug for that function. We studied and cleared for security functions, 200 milligrams, 300 milligrams and 400 milligrams and all three dose ranges bought responses. That is the proper place for FDA to wish to sink their tooth in.

Now we got here again, suggesting that between 300 and 400, there was no efficacy improve however there was a danger that there could be some off-target impact. We had been saturating the goal of 300, so it did not make sense to go to 400, 300 was higher between these two. Between 200 and 300, we really feel as if once we run our publicity evaluation, there’s a greater chance of getting a response of 300 milligrams and due to this fact, 300 is best than 200. And the FDA stated, okay, we recognize that logic. That is sensible. We would similar to to see just a few extra sufferers at that lowest dose degree to verify we agree.

And so the negotiation with FDA was all about what number of extra sufferers do you want to have the ability to see to assist us resolve is 200 or 300 the suitable advisable Section 2 dose, and we agreed on the quantity 9. So we’ll spend the following – this quarter, after all, now that we’re open for enrollment the place the blocking and tackling is in strategy of getting all of our websites open. After which, after all, we’ll rapidly transfer into enrolling these 9 further sufferers.

And my hope can be that someday early to mid subsequent yr, we have got these sufferers on research. We are able to run the evaluation on them, construct the briefing e book and have that dialogue with FDA and certainly one of two outcomes goes to occur. Both the info goes to return again precisely the best way we thought and the best way the early information advised and 300s or dose and FDA will agree or frankly, we’re incorrect. And once we put 9 extra sufferers on it 200 milligrams, we get a bunch of CRs at 200 milligrams. During which case, you realize what the FDA turned out to be proper or no less than the query turned out to be legitimate. And we’ll then transfer ahead with 200 milligrams as our dose.

However we must always know that someday by mid subsequent yr can be my guess. That’s a extremely lengthy reply, however I needed to verify to deal with it totally. Did that assist?

Li Watsek

Thanks. Sure, recognize that very a lot. Thanks.

Jim Dentzer

Okay, thanks.

Operator

This concludes our question-and-answer session. I wish to flip the convention again over to the corporate’s President and Chief Govt Officer, James Dentzer, for any closing remarks.

Jim Dentzer

Glorious. Thanks, operator, and thanks, everybody, at present for becoming a member of at present’s name. And as all the time, thanks to the sufferers and households collaborating in our medical trials. To our workforce at Curis for his or her onerous work and dedication and to our companions at Aurigene, ImmuNext and the NCI for his or her ongoing assist and assist. We stay up for updating you once more quickly. Thanks, Gary.

Operator

Thanks. The convention has now concluded. Thanks once more on your participation. It’s possible you’ll now disconnect.