Curis, Inc. (NASDAQ:CRIS) Q3 2023 Earnings Call Transcript

Curis, Inc. (NASDAQ:CRIS) Q3 2023 Earnings Call Transcript November 2, 2023

Curis, Inc. beats earnings expectations. Reported EPS is $-2.13, expectations were $-2.32.

Operator: Good morning, and welcome to Curis’ Third Quarter 2023 Business Update Call. All participants will be in a listen-only mode. [Operator Instructions] After the company’s prepared remarks, all participants will have an opportunity to ask questions. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the conference over to Diantha Duvall, Curis’ Chief Financial Officer, Diantha, please go ahead.

Diantha Duvall: Thank you, and welcome to Curis’ third quarter 2023 business update call. Before we begin, I’d like to encourage everyone to go to the Investors section of our website at www.curis.com to find our third quarter 2023 business update press release and related financial tables. I would also like to remind everyone that during the call, we will be making forward-looking statements, which are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties and actual results may differ materially. For additional details, please see our SEC filings. Joining me on today’s call are Jim Dentzer, President and Chief Executive Officer; and Jonathan Zung, our Chief Development Officer. We will also be available for a question-and-answer period at the end of our call. I’d now like to turn the call over to Jim.

Jim Dentzer: Thank you, Diantha. Good morning, everyone, and welcome to Curis’ third quarter business update call. This quarter marked a key inflection point for the company and for patients as we were able to return our focus to clinical enrollment in our TakeAim Leukemia and TakeAim Lymphoma studies with the removal of the partial clinical hold. Later this morning, abstracts for the 65th ASH Annual Meeting will be unveiled, and we are pleased to have several abstracts under consideration. At ASH, we expect to provide an update from our TakeAim Lymphoma study, including our first look at proof-of-concept data for patients with primary CNS lymphoma, a rare form of extranodal non-Hodgkin lymphoma, for which there are limited treatment options.

A scientist working with petri dishes in a high-tech laboratory for biotechnology research.

In the TakeAim Leukemia study, we have reopened our clinical sites and are working with them to identify and enroll new patients. As a reminder, the TakeAim Leukemia study is a monotherapy study, targeting patients with relapsed or refractory AML with either a FLT3 or spliceosome mutation. Enrollment of new patients has begun, and we expect to have our first look at data from these patients in the first half of 2024. Lastly, we are working with clinical sites and regulatory authorities on advancing a new triplet study of emavusertib in combination with azacitidine and venetoclax in AML. This study is intended to evaluate safety as well as emavusertib’s ability to enhance the effectiveness of azacitidine and venetoclax by studying AML patients who are responding to azacitidine and venetoclax treatment, but still have Minimal Residual Disease or MRD.

Our hope is that with the addition of emavusertib o their treatment regimen, we can help these patients convert from MRD-positive status to MRD-negative. We expect to initiate this study in the fourth quarter and see initial data in the second half of next year. In short, we’re making great progress in advancing the potential of emavusertib as a monotherapy, as a doublet therapy combining with ibrutinib and as a triplet therapy in combination with azacitidine and venetoclax, all of which should have data over the coming four quarters. We look forward to providing those updates. With that, I’ll turn the call back over to Diantha to review our financial results for the quarter. Diantha?

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Q&A Session

Diantha Duvall: Thank you, Jim. For the third quarter of 2023, Curis reported a net loss of $12.2 million or $2.13 per share as compared to a net loss of $13.3 million or $2.83 per share for the same period in 2022. Curis reported a net loss of $35.7 million or $6.6 per share for the nine months ended September 30, 2023, as compared to a net loss of $45.3 million or $9.82 per share for the same period in 2022. Revenues for the third quarter of 2023 and 2022 were both $2.8 million. Revenues for both periods consist of royalty revenues from Genentech. Genentech and Roche’s sales of Erivedge. Revenues for the nine months ended September 30, 2023 and 2022 were both $7.3 million. Research and development expenses were $10.4 million for the third quarter of 2023 as compared to $10.8 million for the same period in 2022.

The decrease in research and development expenses for the quarter is primarily attributable to lower employee-related costs due to a reduction in headcount, partially offset by increased clinical costs. Research and development expenses were $29.5 million for the nine months ended September 30, 2023, as compared to $34.6 million for the same period in 2022. General and administrative expenses were $4.8 million for the third quarter of 2023 as compared to $4.6 million for the same period in 2022. The increase was primarily attributable to higher professional, legal and consulting services costs. General and administrative expenses were $4.8 million for the third quarter of 2023 as compared to $4.6 million for the same period in 2022. The increase was primarily attributable to higher professional, legal, and consulting services costs.

General and administrative expenses were $13.8 million for the nine months ended September 30th, 2023, as compared to $15.3 million for the same period in 2022. Other income net was $0.2 million for the third quarter of 2023 as compared to other expense net of $0.7 million for the same period in 2022. Other income and expense net primarily consists of interest income, partially offset by non-cash expense related to the sale of future royalties. Other income net was $0.4 million for the nine months ended September 30th, 2023, compared to other expense net of $2.5 million for the same period in 2022. As of September 30th, Curis’ cash, cash equivalents, and investments totaled $68.5 million, and there were approximately 5.9 million shares of common stock outstanding.

We continue to be in a strong cash position and expect that our existing cash, cash equivalents, and investments should enable us to maintain our planned operations into 2025. With that, I’d like to open the call for questions. Operator?

Yale Jen: Good morning and thanks for taking the questions and congrats on the progress. Two questions here. The first question is that in terms of the ASH abstract you intend to present, could you give us a little bit color? You mentioned there’s more than one. So, what’s the general context of that? Then I have a follow-up.

Jim Dentzer: Yes. So, thank you, Yale. I appreciate that. So, we’re going to defer most of the comments about the ASH abstract until the abstracts go live. However, what I would say is that we’ve got leukemia and lymphoma ongoing. The leukemia study really got started or restarted in July with the enrollment of new patients. So, those data are really a 2024 story, not an ASH story. Lymphoma is really going to be the new data that are coming at ASH. And as we’ve talked about before, we have, in the past, looked at monotherapy and combination therapy. We’ve established our dose and we’ve targeted the indication of primary CNS lymphoma as the ideal place for us to go. The reason we selected primary CNS was, as you recall, first, it’s an orphan indication within lymphoma.