Traws Pharma, Inc. (TRAW) Q4 2021 Earnings Report, Transcript and Summary

Ladies and gentlemen, thank you for standing by. Welcome to the Onconova Therapeutics’ Full Year 2021 Financial Results and Business Update Conference Call. [Operator Instructions] As a reminder, this call is being recorded today, March 17, 2022. At this time, I would like to turn the call over to Avi Oler, Senior Vice President of Corporate Development and General Counsel.

Thank you, operator. Good afternoon, everyone. And welcome to Onconova’s full year 2021 financial results and business update conference call. Earlier this afternoon, we issued a press release reporting our financial results and business progress. If you have not yet seen this press release, it is available in the Investors & Media section of our website at www.onconova.com. On today’s call you will first hear from our President and CEO, Dr. Steve Fruchtman, who will give a high-level overview on our recent progress and plans for 2022. Our Chief Medical Officer, Dr. Mark Gelder, will then provide a more detailed clinical and scientific update before handing the call to Mark Guerin, our Chief Financial Officer, to review our full year 2021 financial results. Following these formal remarks, we then finish the call with a question-and-answer session. Before passing the call to Steve, I’d like to remind everyone that statements made by management during this conference call will include forward-looking statements under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties that can cause actual results to differ materially. Forward-looking statements speak only as of the date they are made as the underlying facts and circumstances may change. Except as required by law, Onconova disclaims any obligation to update these forward-looking statements to reflect future information, events or circumstances. For more information on forward-looking statements, please review the disclaimer in today’s press release and the risk factors in the company’s SEC filings. With that, it is my pleasure to turn the call over to Steve.

Thank you, Avi. And good afternoon, everybody. Thank you for joining us. And we wish all a very happy St. Patrick’s Day. It is my pleasure to give an overview of our progress over the past few months. We believe this progress has us on track for an exciting 2022 with key milestones expected throughout the year. Our lead asset narazaciclib continues to advance through its Phase 1 program in patients with advanced solid tumors, which includes two separate and complimentary clinical trials in the United States and China. For those of you who are new to the Onconova story narazaciclib is a multikinase inhibitor with a low nanomolar activity against CDK4 and CDK6 and other kinases important for cancer cell proliferation and motility. Two processes that are intimately involved in tumor proliferation and metastatic disease. In these Phase 1 trials, we are evaluating narazaciclib with both a daily dosing schedule and also a three weeks on, one week off dosing schedule. Designing our Phase 1 program in this fashion allows us to evaluate narazaciclib with dosing schedules that are currently used for FDA approved CDK4/6 inhibitors. We believe this approach lead to an optimized, recommended Phase 2 dose to bring into the clinic and to the generation of data that differentiates our lead asset from competing agents. Looking ahead for narazaciclib, we plan to use the findings from the Phase 1 program to identify a recommended Phase 2 dose in the second half of the year. This would then inform the design of a Phase 2 basket trial in multiple indications to begin thereafter, as well as one or more additional studies that will be designed to evaluate the safety and efficacy of narazaciclib alone or in combination with other anti-cancer agents. Dr. Mark Gelder, our Chief Medical Officer, will be discussing these concepts further in a few moments. Outside our lead program, we continue to leverage collaborations with industry partners and key opinion leaders at academic institutions to further the clinical development of rigosertib, which targets the Ras and polo-like kinase or PLK1 pathways. Rigosertib has also been shown to act as an immune modulator and to recruit T cells into the tumor microenvironment via the presentation of novel antigen on the host tumor cell membranes and is being studied in multiple investigator-sponsored trials. In the fourth quarter, we announced preliminary data from one of these investigator-sponsored trials, which is evaluating rigosertib monotherapy in recessive dystrophic epidermolysis bullosa, or RDEB, which is frequently complicated by squamous cell carcinoma of the skin. Though these initial data from a single patient in this ultra-rare disease, we believe they represent an important update given the invariable fatal nature of this extremely rare disease, the lack of available therapies and the fact that we observed a durable complete response of over a year in extensively pretreated patients. In addition to the RDEB trial, oral rigosertib also continues to be evaluated in combination with the PD-1 checkpoint inhibitor, nivolumab, in an investigator-sponsored trial in KRAS-mutated non-small cell lung cancer. This Phase 1/2a trial seeks to leverage rigosertib’s dual mechanism of action as an immune modulator and as a down regulator of the RAS-mutated pathway in order to enhance the efficacy of checkpoint inhibitors. And this trial has already generated compelling preliminary data, which is agnostic to the type of KRAS mutation present, and this was discussed at length on our last quarter’s earnings call. Looking ahead, we expect to report additional data from this trial later this year. We are also working to further leverage rigosertib’s role as an immune modulator and its potential to enhance the efficacy of check inhibitors through the upcoming initiation of additional investigator-sponsored study in patients with advanced metastatic melanoma. Similar to the non-small cell lung cancer trial, this study is designed to evaluate rigosertib in combination with an anti-PD-1 inhibitor, though in this case, the PD-1 inhibitor will be pembrolizumab. Now before I hand the call over to Dr. Gelder to provide some more detail on the clinical programs I just mentioned, I’d like to once again say that we at Onconova continue to dedicate our primary focus and resources to the narazaciclib program. While rigosertib has recently generated compelling data in both non-small cell lung cancer and RDEB-associated squamous cell carcinoma, we plan to pursue its continued clinical development primarily through investigator-sponsored trials at leading academic institutions. We believe this strategy will enable an optimal risk-benefit balance as we work to unlock additional value for stakeholders by addressing present unmet medical needs with rigosertib. Finally, I like to recognize a notable corporate achievement from last quarter, which was the addition of Dr. Adar Makovski-Silverstein as our Director of Corporate Development. Adar joined Onconova for Amgen, where she was responsible for evaluating external scientific opportunities across all therapeutic areas and managing processes within business development and across functional teams. She has extensive scientific expertise in oncology, having worked in some of the leading laboratories and biotech companies in the U.S., which will be an invariable and valuable asset as we work to advance our pipeline and evaluate opportunities for its potential, strategic expansion through in-licensing. So, with that, I’ll now hand the call over to Dr. Gelder to speak a bit more about our ongoing and planned clinical trials. Mark?

So, thank you, Steve. And thanks to all of those who have joined us today. I’ll begin today with our narazaciclib program. As Steve mentioned, narazaciclib is a multi-targeted kinase inhibitor that targets CDK 4 and 6 as well as several additional kinases at low nanomolar concentrations. We believe it has the potential to be a highly differentiated therapy due to several key characteristics such as its preclinical safety profile, which shows that it appears to cause less myelosuppression and neutropenia compared to palbociclib, the most widely prescribed CDK4/6 inhibitor today. Preclinical data suggesting potent inhibition of CDK2, a kinase understood to be essential to DNA replication and one of several potential mechanisms of resistance in the hormone receptor positive HER2-negative metastatic breast cancer population to the approved CDK4/6 inhibitors. Additionally, its ability to inhibit ARK5, which promotes the survival of cancer cells in hypoxic microenvironments, serves an important role in cell adhesion and metastasis and may play a role in drug resistance. Its ability to inhibit CSF1 receptor, or CSF1R, which results in the stimulation of antitumor immunological effects and its ability to inhibit the growth of cancer cell lines resistant to palbociclib. We believe this differentiated pharmacologic profile positions narazaciclib to be studied even beyond areas where other CDK4/6 inhibitors inhibitors are currently approved both as a single agent and in combination with a myriad of other anticancer compounds. To begin evaluating this hypothesis, narazaciclib is being studied in two Phase 1 trials: one in the United States and one in China, where we are collaborating with HanX Biopharmaceuticals. Our U.S. study is evaluating a continuous daily dosing schedule of narazaciclib and is enrolling patients with a variety of advanced cancers. If this study shows a favorable safety profile for continuous daily dosing of narazaciclib, it will allow us to further differentiate our lead asset from both palbociclib and the other approved CDK4/6 inhibitor, ribociclib, which are both dosed on a schedule of three weeks on, one week off. These agents are associated with bone marrow toxicity leading to significant myelosuppression or low white blood cell counts and thus, as I mentioned, require a three weeks on, one week off dosing schedule. I’m pleased to say today that the safety findings we have seen in nerazacyclib’s Phase 1 trial thus far have been very promised. No dose-limiting toxicities have been observed in either trial including the lack of clinically meaningful neutropenia. The trial in the U.S. remains ongoing and is currently enrolling patients into its fourth dose cohort, which is evaluating 160 milligrams orally administered daily. Narazaciclib’s complementary Phase 1 trial in China is also moving along very well as our partner, HanX Biopharmaceuticals, has completed the trial’s fourth dose escalation cohort which evaluated the 160-milligram dose of narazaciclib administered orally with a three week on, one week off dosing schedule. We have not seen any dose-limiting toxicities in this trial, and HanX is now enrolling the fifth dose cohort at 200 milligrams orally with a three week on, one week off schedule and is currently working to prepare a protocol amendment to enable the evaluation of higher doses. Ultimately, we expect the data from narazaciclib Phase 1 program to enable the selection of a recommended Phase 2 dose later this year. This will then be utilized in future trials, including a Phase 2 basket trial enrolling patients with several different types of cancer such as CDK4/6 inhibitor refractory hormone receptor positive HER2-negative metastatic breast cancer. Narazaciclib’s potential in this indication is supported by the preclinical data I mentioned earlier, which shows it inhibiting the growth of cancer cell lines resistant to palbociclib. We are also planning one or more additional clinical trials of narazaciclib, as Steve mentioned, which will be designed to evaluate its safety and efficacy alone or in combination with other anticancer agents. We are still developing these specific plans for these trials, and we’ll share them with you once they are finalized. Moving on. I’d now like to turn your attention to rigosertib’s investigator sponsor program, starting with the program’s most recent data update. This update occurred in December when we reported preliminary clinical data at a European Dermatology and Venereology Annual Conference showing rigosertib’s ability to inhibit PLK1 translates into activity against RDEB-associated squamous cell carcinoma. As Steve previewed, RDEB-associated squamous cell carcinoma is an ultra rare and invariably fatal condition caused by a lack of Type 7 collagen protein expression. Type 7 collagen is responsible for anchoring the skin’s interlayer to its outer layer and due to its absence RDEB patients suffer from extreme skin fragility and chronic wound formation. Over time, many of these patients develop squamous cell carcinoma and the overexpression of PLK1. The disease and its tumors are highly aggressive with a cumulative risk of death of greater than 78% by age 55. The standard of care for these patients is tragically poor as targeted therapies, conventional chemo and radiation therapies as well as immunotherapy provides limited response rates and poor durability of response. The trial’s investigators presented data from an RDEB patient. This patient had a history of multiple unresectable squamous cell carcinomas that were unresponsible to multiple prior treatments, including the PD-1 inhibitor, cemiplimab. Notably, when treated with rigosertib monotherapy, the patient experienced a sustained complete response without signs of any further disease following 13 treatment cycles. To see a complete response in this indication, particularly in a patient that had failed multiple prior therapies, is a very promising observation that we believe warrants further study. It confirms rigosertib’s activity against PLK1 in the clinic and positions it as a novel treatment option that can greatly improve upon the current standard of care in a very challenging indication. We look forward to the continued advancement of this clinical trial and will provide additional updates as appropriate. In addition to this investigator-sponsored trial in RDEB-associated squamous cell carcinoma, rigosertib is also being evaluated in combination with the PD-1 inhibitor, nivolumab, in an investigator-sponsored Phase 1/2a trial in KRAS-mutated non-small cell lung cancer patients who have previously failed checkpoint inhibitor therapy. This trial leverages rigosertib drawl as an immune modulator that targets the mutated KRAS pathway and build upon preclinical we’ve discussed in the past that demonstrates rigosertib’s ability to synergize with checkpoint inhibitors by reversing cold immunosuppressive tumor micro environments through the upregulation of novel antigens such as CD40 on cancer cells and thereby recruit host T cells that the immune modulator can stimulate to attack the tumor. Preliminary results from this trial, which were discussed at like during our last earnings call, support the potential anticancer activity of the rigosertib-nivolumab combination. They also demonstrate rigosertib’s applicability across multiple KRAS mutations, which differentiates it from other RAS pathway modulators, that only target a subset of patients with a particular mutation and suggest that rigosertib may enhance checkpoint inhibitor efficacy. We continue to build on these results through the trial sustained progress with its dose expansion phase currently enrolling patients and additional data expected later this year. An additional study that will allow for the evaluation of increased doses of rigosertib that is part of the doublet with nivolumab is also under consideration since the maximum tolerated dose was not reached to date. Beyond non-small cell lung cancer, we are seeking to further leverage rigosertib synergy with checkpoint inhibitors through a planned investigation trial in metastatic melanoma that will evaluate it in combination with the PD-1 inhibitor, pembrolizumab. With anti-PD-1 resistance occurring in 40% to 60% of metastatic melanoma patients, there is a pressing unmet need to enhance the efficacy of these agents that we believe rigosertib may help address. This hypothesis is supported both by the preliminary clinical results in checkpoint inhibitor refractory non-small cell lung cancer I just mentioned as well as by the preclinical data. The protocol for this investigator-sponsored melanoma trial is finalized, and we expect to open the study later in the first half of this year. Finally, before handing the call over to Mark, I’ll just once again remind everybody that while we are very interested in furthering rigosertib’s clinical development to investigator-sponsored trials, we remain primarily focused internally on our lead narazaciclib program. And with that, I’ll turn the call over to Mark Guerin for a discussion of our 2021 financial results. Mark?

Thanks, Mark, and good afternoon, everyone. Starting with a quick review of our full year expenses. Research and development expenses were $7.3 million for 2021 compared with $16.9 million for 2020. The decrease was primarily related to the company’s focus in 2021 on its Phase 1 program with narazaciclib, following the completion of the Phase 3 INSPIRE study in 2020. General and administrative expenses were $9.4 million for 2021 compared with $8.3 million for 2020. This increase was primarily related to costs related to special and annual general meeting expenses incurred in the 2021 period. We reported a net loss for the full year of 2021 of $16.2 million or $0.96 per share on 16.8 million weighted average shares outstanding compared with a net loss of $25.2 million or $2.17 per share for 2020 on 11.6 million weighted average shares outstanding. Cash and cash equivalents as of December 31, 2021, were $55.1 million compared with $19 million as of December 31, 2020. The company believes that its cash and cash equivalents will be sufficient to fund ongoing clinical trials and business operations for at least two years. This completes my financial review. I’ll now turn the call back to Steve.

Thank you, Mark. Before moving on to our Q&A, permit me to first summarize the key value-creating milestones we are expecting throughout the rest of this New Year. In our lead narazaciclib program, we expect to select a recommended Phase 2 dose in the second half of the year based on findings from our ongoing Phase 1 program. This would then be followed by the initiation of a Phase 2 basket trial in indications such as hormone receptor positive, HER2-negative metastatic breast cancer. Outside of our lead program, we expect an investigator-sponsored trial evaluating rigosertib in combination with pembrolizumab in advanced melanoma patients to begin in the first half of this year. We also expect additional data from the Phase 1/2a trial of rigosertib plus nivolumab in KRAS-mutated non-small cell lung cancer agnostic to the type of KRAS mutation present to be reported in 2022. Finally, we continue to actively evaluate the science and market size behind various opportunities to potentially expand our pipeline through strategic licensing and collaborations. Though I emphasize that we have very strong conviction around the value of our current pipeline and their potential to deliver value to our investors and the patients in need based on the results we have shared with you today and our ongoing and planned studies. And with that review of our clinical progress and finances, we’ll now open the call for questions. Operator?

[Operator Instructions And our first question will come from the line of Charles Zhu from Guggenheim. You may begin.

Good evening everyone and thanks for taking the questions. My first one, could you help us perhaps understand the types of patients you’ve been enrolling in our Phase 1 dose escalations for narazaciclib to date as well as the degree to which they’ve been treated with other prior therapies such as currently approved CDK4/6 inhibitors? Thanks.

Thanks, Charles. I’ll ask Dr. Gelder to take that question. Mark?

Yes. So we have been enrolling as do most Phase 1 studies. We have been enrolling patients with a variety of different solid tumors. It’s not like, we’re just getting breast cancer or just getting lung cancer or just getting colorectal cancer, we are – it’s really a smartest board, so we have enrolled patients with a variety of solid tumors. And all of these patients have been heavily pretreated. They have exhausted “standard of care” therapeutic options, which is very typical for Phase 1 programs.

Understood. That makes a lot of sense, especially considering it’s Phase 1. I guess then as well as a brief follow-up to that, when you look a little further ahead and you start selecting out dose expansion cohorts for narazaciclib, to what degree do you think you might be able to use what you’ve observed in your Phase 1 dose escalation towards indication selection? Or will that perhaps purely be based off of the preclinical work that you’ve done? Thanks.

Mark? Yes.

Yes. So we will we will clearly look at the Phase 1 data very carefully to see if there’s a signal that we see that is unexpected, but we will also look very closely at our preclinical data and hints from preclinical data and direction from preclinical data, and we will look at trials, the myriad of trials that have been conducted with other CDK4/6 inhibitors. So we are assessing multiple different potential tumor types, indications, combinations, et cetera, and we’ll have a final group for the basket study or bucket trial in the next several months. Yes.

Understood. Thank you. And if I may just squeeze one last one in there. How are you perhaps thinking about potential development partnerships for narazaciclib, especially as you bring this further through clinical development? Thanks.

Avi, would you like to take that, please?

Sure. Thanks for the question, Charles. So as we think about partners for narazaciclib, we control worldwide rights outside of China, so geographic partnerships as well as companies that are interested in the indications that we’re interested in pursuing. It’s a ripe opportunity for collaboration.

Great. Thank you for taking all my questions.

Thank you, Charles.

Our next question will come from the line of Ahu Demir from Ladenburg. You may begin.

Good day team. Thanks for taking my questions and I hope everyone is well. My questions are on the sickle program. So as you look towards potentially identifying a recommended Phase 2 doses in the second half of this year, could you maybe provide more color on, how the China protocol amendment affects your dose cohorts? Do you plan to amend your protocol and perhaps go to higher doses based on this?

Mark?

Yes. So thank you for your question. And the protocol in China, HanX wrote the protocol through five dose cohorts and up to 200 milligrams a day, three weeks on, one week off. They are currently enrolling that fifth dose cohort, as I mentioned. And to date, through the first four cohorts, have not seen any DLTs, et cetera. So their protocol as currently written did not allow them to continue to dose escalate. So they are in the process of preparing a protocol amendment, which will allow them to continue on with doses above 200 milligrams a day, three-weeks on, one-week off. Our protocol here in the U.S., Onconova’s protocol, was written a little bit differently upfront so that our protocol allows us to continue to dose escalate in increments of 40 milligrams daily on a continuous basis. So we are not forced to do a protocol amendment just because we’ve gotten to the 200-milligram a day dose. Does that answer your question?

Yes, Mark, it does. And it would be helpful if you maybe mention also, do you – does it also have you maybe go up to higher doses? Or like would it lead you to do that? Or are you actually sticking to your original protocol in? If you could remind maybe the dose escalation study in terms of how high you plan to go for narazaciclib programs?

Go ahead, Mark.

Go ahead, Steve. No, no. Go ahead, Steve.

Okay. Thank you, Mark. Ahu as you know, the three-week on, one-week off protocol study in China is a bit different than the U.S. study, which is every day, and we can’t predict. So clearly, as Mark said – the study in China will have an amendment will be dose escalated. We don’t know if we will also be not seeing DLTs in the U.S. everyday study. To date, we have not. If that continues to be the case as we dose escalate, then we will also amend up total and continues to just escalate, but because it’s every day dosing the results can be different. That’s why we designed the trial this way to mimic the way the CDK4/6 inhibitors are prescribed in the U.S., two of the drugs prescribed three-week on, one-week off, one of the drugs prescribed daily, and we don’t know what will be required to optimize the recommended Phase 2 dose of narazaciclib. So we will look at both studies, and then Mark’s team will make a decision how best next steps.

Sounds great. Thank you. This is helpful. My follow-up question is around the data dissemination. We are expecting to see data from narazaciclib. Could you maybe give a bit more color on what are we expecting to see? And how the data will be disseminated? Are we looking for a scientific conference or not? Just curious.

Mark and I both come out a very academic background. So at some point, we will no doubt present this data at a medical conference, an important medical conference, hard to predict which one because we don’t know when we’ll have the complete data set and then we have to coordinate that with abstract deadlines to meet the deadline for a subsequent meeting. So no doubt, this data, which is very important, will be presented at a major medical conference when we are ready to present the data.

That’s helpful. So my last question will be on the financials. I noticed there is a slight reduction in operating expenses. So Mark, I’m curious if you’re expecting a similar trajectory in the subsequent quarters?

Hi, Ahu thanks for the question. I think the – our operating cash burn throughout 2021 was about $4.1 million, $4.2 million per quarter if you take out changes in working capital. And I think that reflects – as I stated earlier, the company is focused on narazaciclib in being a Phase 1 company as opposed to 2020 when we were a pivotal Phase 3 company with a global trial. So I predict or project that our operating cash burn will be around the same level while we remain a Phase 1 company. And then as we get into further studies down the road, either expansion cohorts in a Phase 2 study or other studies, I think the cash burn would increase. But until those things happened, I think we’re probably at around the same level for the – at least the near term.

Thank you. Thanks for answering my questions.

Our next question will come from the line of Joe Pantginis from H.C. Wainright. You may begin.

Hey guys good afternoon. Thanks for taking the questions. Two questions actually. The first one I’ll admit right now is probably a little bit leading. So when you consider the rigosertib program in RDEB patients, the standard of care for RDEB has the potential to change quite dramatically over the next year, especially after Crystal’s positive gene therapy data showing significant wound closure. So I guess, how I would approach the question is the role that rigosertib can still play in RDEB patients with SCC over the long term, despite say, increased wound closure because these patients basically from day one have seen this constant insult and injury to their skin layers? Thanks.

So I’ll take a stab at that. Obviously, the gene therapy program from Crystal is very exciting, and we look forward to hearing more about their results, but we cannot predict being an experimental program, the effects eventually on the patients with RDEB and whether or not how extensive the healing process will be with gene therapy and will there continue to be a predilection to develop squamous cell carcinoma and that can be underlying gene deficit may be corrected between what degree. Will it be 100%, 10%, 20%, I think more data needs to be generated. But I think what’s interesting in my view about the RDEB study is that polo-like kinase is driving these squamous cells, and there are other squamous cells of humanity, which are much more common. Squamous cell the lung, the cervix, head and neck squamous cell. And so all of them may not be driven by polo-like kinase, but the ones that are down the road, we’d be very interested in looking at these patients as well. And of course, we’re looking for additional patients with this ultra-rare RDEB disease complicated by squamous cells so we can increase the cohort of patients treated with rigosertib. We’re very excited. This patient remains on study. They remain in a complete response a year later, and it’s quite extraordinary. So we look forward to the results in Crystal and continuing to develop rigosertib as well.

Great for that. I appreciate it, Steve. And then my second question actually sticks with rigosertib. It’s more of a little bit forward-looking as well. As you look towards your metastatic melanoma program and beyond to enhance the profile about the immune stimulatory properties, I guess, as you look at the clinical studies, what would be any of the translational plans or analyses that you might be looking towards to show – to further support the immunomodulatory properties?

Mark, do you want to take that?

Sure. So I mean, we could spend a few hours talking about that. But in a nutshell, I think that in the melanoma program, they have a variety of different cohort studies that they’re going to be looking at to look at what changes actually take place in the tumor microenvironment; what kind of cell infiltrates are there? What kind of cytokine release is there, et cetera, et cetera? So as you can imagine, the melanoma study, the melanoma ISS that is going to be getting underway shortly at Vanderbilt, that study is going to be looking at a variety of different things. And it’s – I really – I have to be careful on what I say because it’s not publicly available yet, but they are going to be looking at a variety of things that will then once we have the answers to those questions will hopefully allow us to start looking very carefully at the combination of checkpoint inhibitor and rigosertib, perhaps not only in melanoma, but other tumor types and be able to narrow down or focus on particular populations that would potentially be of greatest interest. But I promise you that study is going to do a lot of correlative work trying to answer this very question.

Understood. Thanks a lot guys.

Thank you. That is all the time we have for questions today. I’d like to turn the call back over to the speakers for any closing remarks.

We’d like to thank all of you for really very insightful questions today, and thank you. We’ll also thank you for participating in today’s update call. We look forward to executing on our business plan and to keep you appraised of our progress with our research compounds. We appreciate your continued interest in these programs, and thanks again for joining us and have a lovely evening, and look forward to talking more in the future about our advances. Thank you.

Ladies and gentlemen, thank you for your participation on today’s conference call. This concludes today’s event. You may now disconnect. Everyone, have a great day.