Good morning, and welcome to the Karyopharm Therapeutics Q2 ‘22 Earnings Conference Call. Please note, this event is being recorded. I would now like to turn the conference over to Ms. Elhan Webb, Senior Vice President, Investor Relation. Please go ahead.

Thank you, operator, and thank you all for joining us on today's conference call to discuss the Karyopharm second quarter 2022 financial results and recent company progress. Today, I'm joined by Richard Paulson, President and Chief Executive Officer; Sohanya Cheng, Chief Commercial Officer; Dr. Reshma Rangwala, Chief Medical Officer; and Mr. Mike Mason, Chief Financial Officer. Earlier this morning, we issued a press release detailing Karyopharm's financial results for the second quarter 2022. This release, along with the slide presentation that we will reference during today’s call, are available under the Events & Presentation section of our website at karyopharm -- closing remarks before opening the call up for questions. Before we begin our formal comments, I'll remind you that various remarks we will make today constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995, as outlined on Slide 3. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussing the risk factors section of our most recent quarterly report on Form 10-Q, which is on file with the SEC and in other filings that we may make with the SEC in the future. Any forward-looking statements represent our views as of today only. While we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our views change. Therefore you should not rely on these forward-looking statements as representing our views as of any day, subsequent to today. In addition, we will also be providing on this call outlook for non-GAAP R&D and SG&A expenses for 2022. We are not providing reconciliations of these forward-looking non-GAAP measures because projections of stock compensation expense, which is required for such reconciliations are not available without unreasonable efforts. I will now turn the call over to Richard. Please turn to Slide 4.

Thank you, Elhan and good morning to everyone joining us on the call and webcast today. This morning, I'm excited to provide an update on our plan as we continue to execute on our growth strategy through our focused pipeline, targeting life-threatening cancers. In Q2, we saw a significant increase in total revenues compared to Q2 of '21 of approximately $40 million, which includes the benefit of licensing and milestone revenue as we continue to receive new or expanded regulatory approvals globally. With growing patient access for selinexor across the world, we expect revenues in ex-U.S. territories to have an increasing contribution to total selinexor revenues in the future. In addition, we are pleased to have delivered 44% net product revenue growth year-over-year, despite an increasingly competitive multi myeloma market and some continuation of COVID-19 related challenges. I am pleased with our team's ongoing commitment to successfully execute against key priorities. As a global leader in the inhibition of nuclear export, everything we do is driven by our mission to positively impact patient lives and defeat cancer. On Slide 5, we have an overview of the key pillars that drive our underlying value and provide opportunity for what we believe will be substantial future growth. First, we continue to successfully build upon our existing multi myeloma franchise. Second, we continue to advance our focused clinical pipeline comprised of mid and late-stage clinical development programs that is being purposely built and strategically focused on targeting cancers with high unmet need, where our science enables us to make the biggest difference in the lives of patients and where we believe we'll have the highest probability of success. To that end, based on compelling data signals, we are pursuing opportunities in endometrial cancer, myelofibrosis and myelodysplastic syndromes. Collectively, we believe we have the…

Thank you, Richard and good morning, everyone. Since our launch, we continue to focus on expanding the potential of XPOVIO and its benefit to patients in earlier lines. Turning now to Slide 9 on our commercial highlights for the second quarter of 2022, we grew net product revenue by 44% versus the same period last year, and continued to make progress across key indicators since our second line plus launch at the beginning of 2021. This growth was achieved despite two key challenges namely, the COVID impact on new starts in January and February of 2022, which resulted in a decline on refills in the second quarter and an intensifying competitive landscape in the later lines. Our team executed with strength to access and educate our physician community, improving in-person engagements with healthcare providers from 60% last quarter to 75% in the second quarter, resulting in a recovery of new patient starts. We continue to make progress with our primary growth driver and what we believe is most important to patients, which is a continued shift of XPOVIO into early align and the community setting with over half of our patients in the second to fourth line. As we track duration of therapy, which takes time to mature, we expect to see the benefit of this earlier line shift and continued education to improve tolerability resulting in more patients staying on therapy longer as we approach the end of the year. Although, we have seen increasing competition in the late line setting at academic centers with new approvals and ongoing trials, our focus remains on expanding the use of XPOVIO in the community setting where a majority of early aligned patients are treated. We drove growth in the community setting and increased our penetration from 64% to 67% versus the…

Thank you, Sohanya. We have strategically partnered selinexor in key ex-U.S. territories and as we look to the future on Slide 11, one of our top priorities is to expand our footprint in multiple myeloma across the globe. As touched on by Richard, Karyopharm and our partners Menarini just recently obtained approval in Europe for NEXPOVIO in combination with bortezomib and dexamethasone in patients with multiple myeloma, following at least one prior therapy. The approval follows a positive opinion granted in May, 2022, by the CHMP based upon results from the Phase III BOSTON study. In addition, selinexor was recently launched in Mainland China, Hong Kong and in Canada through our strategic partners. Turning now to Slide 12, I will be reviewing our focus in developmental pipeline, which has the potential to deliver a consistent and steady stream of new approvals over the next two to four years. As you turn to Slide 13, the unmet need remains strong for new modalities like selinexor to treat multiple myeloma because physician’s ability to class switch with multiple combinations has driven significantly better patient outcomes. The majority of patients treated in the first to second line are given an anti-CD38 based treatment regimen. Unfortunately, multiple myeloma is still considered an incurable disease due to inevitable relapse acquired drug resistance, and therefore many of these patients' disease will become refractory to or relapsed from an anti-CD38, PI and IMiD treatment. Our clinical data support the use of selinexor in the post anti-CD38 setting. We believe this is the setting in which selinexor has the strongest fit. Selinexor has an increasingly understood and manageable safety profile, and while we only promote FDA approved regimens, physicians have the option to combine with several different backbones for the NCCN guidelines. Additionally, with the emergence of new…

Thank you, Reshma. Since we issued a press release earlier today with the full financial results, I will just focus on the highlights, which begin on Slide 20. Total revenue for the second quarter of 2022 was$39.7 million compared to $22.6 million for the second quarter of 2021. With increasing approvals and commercial launches for selinexor globally, we expect milestone and royalty payments by our partners to deliver a larger, contribution to our total revenues in the future. Net product revenue from U.S. commercial of XPOVIO for the second quarter of 2022 was $29 million compared to $20.2 million for the second quarter of 2021, representing a 44% increase year over year. The growth to net discount for XPOVIO in the second quarter was 17%. We expect growth to net discount to be in the 15% to 20% range for the full-year 2022. We recognized $10.7 million of license and milestone revenue in the second quarter of 2022, which includes $6.5 million earned in reimbursement of development expenses from the Menarini Group and $1.5 million related to milestones earned from our partner FORUS Therapeutics. R&D expenses for the second quarter of 2022 were $44.3 million compared to $34 million for the second quarter of 2021. Our results this quarter concluded a one-time $3.8 million severance related stock compensation charge. We expect our 2022 non-GAAP R&D expense to decrease by approximately 10% compared to 2021, with the majority of the decrease expected in the second half 2022. SG&A expenses for the second quarter of 2022 were $37.3 million compared to $36.5 million for the second quarter of 2021. The increase in SG&A expenses was due to a onetime $3.5 million severance related stock compensation charge in the second quarter. Cash, cash equivalents, restricted cash and investments as of June 30, 2022…

Thanks Mike. And as you've heard from the team, we continue to maintain momentum with a number of key near-term catalysts and corporate milestones for us to deliver on, as outlined on Slide 22, as we continue to strive each day for patients with high unmet needs. In closing, I would like to thank all of our teams at Karyopharm and our investigators as we work every day to positively impact the lives of patients with cancer. With that, I would now like to ask the operator to open the call up to the question-and-answer portion of today's call. Operator?

Thank you. First question is from the line of Maury Raycroft with Jefferies.

Hi, this is Kevin Strang on for Maury. Thanks for taking my questions. First question for myeloma. Can you say what percentage of second quarter new patient starts were earlier line? And then should we think of this number as shifting higher from the roughly 50% split with increased academic competition? Thanks.

Yes. Thanks Kevin, for the question. I'll turn to Sohanya for that. Sohanya?

Yes. Hi Kevin, thanks for the question. So yes, we've seen an improvement in that shift into earlier lines. And we're now well over 50% of our patients are now in the second to fourth line. As for the community as we know, a majority of these patients are treated, the earlier lines patients are treated in the community and we see that over 65% of our business comes from the community and we continue to increase our breadth and depth in the community.

Great. Thank you. And then just one on, sorry --

Go ahead, Kevin.

Just one on myelofibrosis. So could you just talk more about what we can expect from the totality of data in the second half of next year in terms of number of patients or follow up for both monotherapy and combo-therapy, and then how are you thinking about how that's going your path forward in myelofibrosis? Thanks.

I will turn to Reshma, who will talk to that. Reshma?

Hi, Kevin. Thanks for the question. So we're very excited to present some updated myelofibrosis data in the second half of 2022. We're going to be focused on -- focusing on the 034 study. The 034 study is in the treatment naive population in which we are evaluating the efficacy and safety of selinexor in combination with Jakafi or ruxolitinib. As you likely know, this study is a Phase I followed by our randomized Phase 2, and we anticipate that we will be providing updated efficacy and safety from the Phase I portion of the trial. So this will include patients that were enrolled as part of the dose escalation, as well as patients that were enrolled as part of the expansion phase. In total, we are anticipating approximately 21 patients to be included in this cohort, and this is going to be additional follow up as compared to what we presented at EHA as well as at ASCO 2022. By and large the data sets that we are going to be providing are going to be similar ASCO 2022 with focus on SVR, TSS50, Anemia data and also updated safety and tolerability data as well.

Next question comes from the line of Peter Lawson with Barclays.

Great. Thanks for the update. With changing guidance, just wondering if you could walk through the any changes in how you're thinking about particular growth drivers for this year and next year, Richard?

Yeah, sure, Peter, I'll just kick it off and then I'll turn it to Sohanya. Because I think as Sohanya mentioned, we did face some headwinds in Q2. We are confident in our revised guidance moving forward as we do believe there's very strong opportunity for growth, especially in that second to fourth line in the community setting. Sohanya maybe talk to some of the growth drivers you see moving forward.

Thanks, Peter. And the first half of the year, we recognize that we faced headwinds, driven by two things. One was the refills were down in the second quarter due to the COVID impact on reducing new patients starts in January and February. And secondly, the intensified competition in the academic centers in the later lines due to new approvals as well as clinical trials ramping up post COVID and our revised guidance reflects these headwinds. As we think about looking ahead, the midpoint of the updated guidance range is $125 million, which represents 27% growth year over year for 2022. And we believe there continues to be significant opportunity for the long-term growth. As we think about the second half of this year and beyond, our team is laser focused in two areas. Number one, accelerating growth in the second to fourth line to offset erosion in late lines from late line competition, and secondly, to expand further into the community where a majority of the earlier line patients are treated and these community physicians prefer a convenient oral regimen that's manageable, easily combinable post an anti CD-38. As we think about growth drivers for the second half of the year, there are several, we see continued positive momentum in these areas. Number one, new patients starts recovery in the second quarter of the year as oncology patient visits are normalizing post COVID. Secondly, as I mentioned, we are seeing this continued positive shift in use of XPOVIO in the second to fourth line over half of our patients are in this setting. We're seeing higher growth in the community. This is a key area of focus for us, increased penetration in the top 20% of the myeloma accounts, a majority of which are community accounts. We're seeing the continued improvement in the perception and building up confidence in the community. And most importantly, as we think about tailwind for the second half of this year with COVID access restrictions coming down, our live engagements of our field based representatives with healthcare providers is increasing significantly. So we've moved to over 75% of our interactions being live. And this is critical for us in a competitive space to drive education at this early stage of the launch. And for these reasons we feel confident about our growth trajectory for the second half of this year and beyond.

And then what percentage of revenues is coming from the academic settings?

Yeah, so about 65% of our business is coming from the community and the remainder is coming from the academic setting, and our focus remains on expanding further into the community.

And then, I guess question just for Mike just thinking about costs for the second half, what you said percent reduction in costs in second half. How does that change as we think about ‘23 as well?

Yeah. So thanks, Peter. We do expect the cost reduction initiatives that we introduced in the second quarter to accelerate in the second half of '22. The cost savings from certain signal seeking programs, such as their studies in long and colorectal cancer that we terminated in addition to personnel related reductions to optimizing our R&D and G&A infrastructure. By eliminating certain roles, we look to align the organization with our core program. So this overall will reduce compensation costs by approximately 10% in the second half of '22. We are not necessarily providing guidance for next year, but our cost reduction initiatives and our focused pipeline, we do expect our cost savings will increase not only in the second half of year, but we will build into 2023 sustaining our cast runway into early 2024.

Thank you. Next question comes from the line of Mike Ulz with Morgan Stanley. Please go ahead.

Hey, guys. Thanks for taking the question. For XPOVIO, in terms of physician perception, can you maybe talk about how that's evolved over the past year or two? Just curious, trying to get a sense of the progress you've made there so far and then looking forward, what's the opportunity to continue to improve that? Thanks.

Thanks, Mike. I'll turn this Sohanya to talk to that.

Thanks, Mike. Perception evolves with the product’s evolution, and our product has been through an incredible evolution in the past 18 months from late lines to early align, high dose to almost half the dose plus with the right supportive care. And so, we have seen perception shift in a positive direction overtime in the intent to prescribe data as well as anecdotal feedback that we get from physicians on a daily basis, particularly in the community setting we are seeing an increase in their likelihood to prescribe in the second to fourth line as well as a positive perception of the product, both in efficacy and safety. What our data is also showing that, more than 90% of our patients are being started on a 100 milligrams or less. So this is great progress as we've seen the evolution of our dosing. As we think about moving forward and improving our perception, the key is to continue to educate our physicians, our nurses, our support staff on the importance of the right dose, dose reductions and supportive care, and live engagements are critical both between the field representative and the healthcare provider, as well as physician-to-physician, peer-to-peer education. So as I mentioned earlier, as COVID restrictions are coming down and our live engagements are increasing, this education will be key to continuing to drive an improvement in our perception moving forward.

Next question comes from the line of Colleen Kusy with Baird. Please go ahead.

Thanks. Good morning, and thanks for taking our questions. So should we be thinking about that the COVID-19 impact from 1Q has now fully cycled through, or should we be expecting some pressures on the second half of this year? And in Europe, can you just talk about how soon you think that could be a meaningful contributor to your top-line and remind us what your economic cycles are please?

Sure, Colleen. Thanks for the question. Maybe for the first part, I'll turn to Sohanya to talk about the COVI-19 impact from Q1, and how that evolves? Because it does evolve over time and becomes reduced as we move forward. And then for the second part, I will turn to Mike to talk kind of about the economics in Europe. So Sohanya maybe kick off the first part.

Yes. So the COVID impact, we break down into two fronts. One is oncology patient visits, and the impact that has on our new patient starts and refills. And we felt that we went through the peak of it in January and February with Omicron, where we saw patient visits come down by up to 10%, which impacted our new starts and internal refills. So we feel that is reflected in our lowering of our guidance. I think the second impact of COVID is access to physicians. And what we're seeing is a trend to returning to normal. We're not at a 100% of live access, but we are around 70%, 75% or so. And so as we think about moving forward, the signs that we see are continued improving signs. We obviously don't have a crystal ball to predict any changes in COVID fluctuations over the course of the year, but the trends that we're seeing both on our oncology patient visit side, as well as the access to our physicians are both improving.

And Mike, do you want to take the second part? Talk about the European launch kind of as a evolve over the next 10, 12 to 24 months.

Sure. Thanks. Just to refresh on our memory on -- so that -- we announced back in December of 2021, includes about 200 million in future milestone plus tiered double-digit royalties on net sales. So Menarini expects first commercial launch in Germany in the second half of this year. And as Richard mentioned, this launch will evolve over the next 12 months as pricing and reimbursement discussions evolve with each country.

Great. Thank you. And if I can ask a follow-up on myelofibrosis, we saw some increasing early data, I believe at 12 weeks at ASCO. The update in the second half, will that include 24 week data. And can you talk about how you expect that data mature from 12 to 24 weeks for both SVR35 and TSS50?

Yes. Maybe I'll turn to Reshma to talk about that. And again as you remember, kind of looking even from our earlier data on deepening over time, I think is an important perspective to look at, Reshma.

Yes, absolutely. Hi, Colleen, thanks for the question. So yes, we absolutely will provide 24 week data. So the data that we anticipate to provide in the second half of 2022 is going to include more patients, so more patients that were enrolled as part of the Phase 1b in addition to the data already presented from the Phase 1a but also more mature data. We'll see the 12 week as well as 24 week in a subgroup of those patients. And as Richard just alluded, we keep going back to the essential data. The essential data is an investigator initiated trial that was evaluating selinexor as a monotherapy, primarily in our relapsed or pretreated patient population. And what we saw in those data were quite intriguing in that patients who stayed on therapy overtime, we saw that their responses deepened over time. So we do anticipate a similar kind of phenomenon as we evaluate selinexor in combination with ruxolitinib now in a first line population specifically that their SVR potentially could deepen over time. So yes, we're looking forward to presenting those data soon.

Next question comes from the line of Brian Abrahams at RBC Capital Market.

This is Steve on for Brian. Can you share any thoughts on how increasing competition in myelofibrosis, including with studies might affect trial recruitment moving forward and any thinking how that might affect your timeline assumptions for next?

I’ll turn to Reshma as we’ve everything talking to, we do see our overall recruitment moving forward well. Reshma, you want to talk to that?

There's a lot of interest coming out of ASCO and especially EHA with the 034 study, that data set was small. As you know, again, we will have an opportunity to present updated data in the second half of this year, but those initial data again were very encouraging, given the fact that we saw some very robust responses in terms of the SVR, as well as intriguing data around TSS50, as well as anemia. So this really has -- sort of has a halo effect. I will say with the investigators too, it is a competitive space, especially because that mylofibrosis patient population is rare. With that said, I think there is a lot of interest in being able to participate in these clinical trials. So we do anticipate enrollment to continue, and we haven't changed -- we don't anticipate any changes in our data availability in terms of read outs.

Next question comes the line of Eric Joseph, JP Morgan.

First one on XPOVIO commercial. I am curious whether you are seeing any tension with the expansion of anti-CD38 use in earlier lines. From the J&J results, we saw impressive growth of DARZALEX and the exception of Q formulation. I was just wondering whether you're seeing competitive dynamic? And also whether you have a sense of XPOVIO uptake today in the patients who prior therapy with anti-CD38 to the extent that with expansion today might represent a windfall in subsequent years. And then also just kind of driving that a little bit further on the uptake that you're seeing today by line of therapy, do you have a sense of -- or could you sort of wait XPOVIO uptake within that second to fourth line setting, so that sort of waited more towards fourth line versus second line?

Maybe I’ll break question in a couple of part, the first part I'll turn this Sohanya to talk about -- as we're seeing increasing use of anti-CD38 in the earlier lines with DARZALEX for us. And also I think within that, Sohanya can probably talk to how we're seeing our evolution between that second to fourth line in terms of lines of therapy where the greatest growth is. And also then turn to Reshma to talk to some of our data really post anti-CD38 and how having a novel new class is really positive for patients post anti-CD 38. So, Sohanya I mean, take the first part and then Reshma can --

Thanks, Eric. So, yes, we're seeing a continued increase in the use of anti-CD38 in the front line, which in turn continues to leave that unmet need open in that middle section of the treatment journey between second to fourth line, where there is no clear standard-of-care, and XPOVIO has proven data post anti-CD38. We only promote to approved regimen, which is a combination with Bortezomib, but NCCN guidelines also has other triplet regimens of XPOVIO in combination with pomalidomide, carfilzomib as well as daratumumab. To answer your second question of what about prior therapies that don't include an anti-CD38 backbone, well, if it included a PI or an IMiD backbone, there is optionality to combine with a different backbone and XPOVIO per the NCCN guidelines. And overall, as we take a step back, the continued white space in that second to fourth line is critical for a couple of different reasons. There is no clear standard-of-care, but also it sets-up patients for potentially successful outcome and accessibility to potential late line therapies as they emerge.

And I just want to piggyback on what Sohanya said too. I mean, from the R&D perspective, there are growing data to suggest from a clinical perspective that treating patients post CD38 increases their efficacy. So the sequence really is an important phenomenon. We also have growing pre-clinical data that also suggests that treating patients post CD38 with selinexor may improve efficacy as well. So this again, treating with selinexor post CD38 really is very efficacious for these patients.

Thanks. And I have a follow up here on the of OpEx guidance. Inclusive of both the lower this year and as you look at 2020 and really just your runway guidance into early 2024, I guess how should we thinking about any impact to the pace enrollment of the randomized studies, the Phase III in either endometrial cancer or myeloma? Is there any prioritization of enrollment that will need to take place there in order to stay within the runway guidance? Thanks.

No. We obviously take assumptions in all our trials of what enrollment will be. So you can see lumpiness in quarters for sure, it has a higher amount of but what's in our forecast and our base planners, are prioritized program driving it forward. We’re just coming off at top of the hour, I think few more questions.

Thank you. Next question comes the line of Ed White with H.C. Wainwright. Please go ahead.

Good morning. Thanks for taking my questions. I'm just wondering if you have any visibility into the mix of the current regimens being used. In particular, the Pomalyst combo, while it's not approved, it has the NCCN guidelines. So I'm just wondering what’s the percentage of the oral regimen is right now and how important the combination trial is to the company, if you are already penetrating that market? And then the second question is just on eltanexor. Can you give us an update there? I know the Phase II ongoing, you are expecting data in the first half of 23, but if there's anything you can tell us about enrollment or any other updates you can give us? Thank you.

For the first part of that question, I'll turn to Sohanya. And the second part we're going to turn it to Reshma because we have moved up that a little bit. Sohanya?

Yes. Thanks Ed, for the question. From the data that we see, and we don't have full visibility into a 100% of our regimen data, but from the data we see overall triplet use trend is growing over time. And about half of that use is -- half of our overall use XPOVIO based triplets. Now the triplets are broken down into a variety of regimens, which include primarily XVD, are approved indication, and then a couple of other indication -- a couple of other regimens as well. The combination with pomalidomide as well as the combination with KYPROLIS, as you mentioned on the NCCN guidelines.

So as I mentioned, it's about half of our use is triplets of which there's a split with a majority of those three regimens up there in the triplets. And in terms of Eltanexor, we're currently evaluating Eltanexor in patients with myelodysplastic syndrome, MDS syndrome. We have two cohorts, 1 is a relapse refractory patient population, and other is a first line in which we are combining Eltanexor with HMA inhibitors, which as you know, are standard-of-care in this patient population. We're very excited to be presenting data in the second half of 2022 from the relapsed refractory Phase 2 patient population, and this is from a pre-planned interim analysis that is fully enrolled at this point.

We’ll just take one more question, Operator. We’re at the top of the hour.

Next question comes from the line of Jonathan Chang with SVB Securities.

This is Faisal Khurshid on for Jonathan Chang. Just want to ask, what could the registrational strategy in myelofibrosis just look like? And how you’re thinking about pursuing the frontline versus the relapse opportunity, like is it just an either/or could you pursue both?

Thanks for the question. I mean, overall, I think, and I'll touch on it overall, but then I want to turn to Reshma talk to it. And overall approaching both is really important for us, I think those opportunities really build a nice franchise in the myelofibrosis area in terms of those relapse patients or in combination up in the frontline. Reshma, maybe you can talk and expand on that.

Yes, absolutely. I mean, we've got a robust clinical development program in myelofibrosis covering both the first line, as well as the relapsed refractory patient population. In the first line setting, we are evaluating selinexor in combination with Jakafi, and we anticipate that combination versus RUX alone, again, in that first line patient population. In the relapsed setting, there really is no standard-of-care. In that relapsed setting, we are likely going to evaluate selinexor versus physician's choice chemotherapy. Both trials are currently enrolling, and likely anticipate that the second -- the relapse refractory patient population would read out first, but again, both trials are on track.

This concludes our question and answer session. I would like to turn the conference back over to Mr. Richard Paulson for any closing comments.

Thank you, operator, and thank you to everyone for joining us on the call today. We're excited to continue moving forward and focusing on our key priorities and continuing to focus on delivering for patients over the rest of this year. That concludes our call.

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