Kura Oncology, Inc. (NASDAQ:KURA) Q4 2022 Earnings Call Transcript

Kura Oncology, Inc. (NASDAQ:KURA) Q4 2022 Earnings Call Transcript February 23, 2023

Operator: Greetings, and welcome to Kura Oncology’s Fourth Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Pete De Spain. Thank you. You may begin.

Pete De Spain: Thank you, Rob. Good afternoon and welcome to Kura Oncology’s fourth quarter and full year 2022 conference call. Joining me on the call are Dr. Troy Wilson, our President and Chief Executive Officer; and Tom Doyle, our Senior Vice President of Finance and Accounting. Dr. Stephen Dale, our Chief Medical Officer is also with us and available to answer questions. Before I turn the call over to Dr. Wilson, I’d like to remind you that today’s call will include forward-looking statements based on current expectations. Such statements represent management’s judgment as of today, and may involve risks and uncertainties that could cause actual results to differ materially from expected results. Please refer to Kura’s filings with the SEC, which are available from the SEC or on the Kura Oncology website for information concerning risk factors that could affect the company. With that, I’ll now turn the call over to Troy.

Troy Wilson: Thank you, Pete, and thank you all for joining us. Let’s jump right in. In December, we were proud to report updated data from our Phase 1 trial of ziftomenib at the American Society of Hematology Annual Meeting. ziftomenib is our once-daily oral drug candidates targeting the menin-KMT2A protein-protein interaction for the treatment of genetically defined AML patients with high unmet need. The data at ASH highlighted the encouraging safety profile and clinical activity of ziftomenib in patients with relapsed/refractory AML. Notably, the data included a 30% complete response rate with full count recovery among 20 patients with NPM1-mutant AML treated at the 600 milligram dose. To our knowledge, this represents one of the highest response rates reported to date for targeted therapies in a relapsed/refractory setting.

A median duration of response had not been reached as of the ASH data cutoff on October 24. In addition to the strong observed clinical activity, ziftomenib demonstrated a favorable safety profile and encouraging tolerability, which resulted in designation of 600 milligrams once-daily dosing as the recommended Phase 2 dose and schedule following a positive Type C meeting with FDA. Building on the momentum of our Phase 1 data and FDA interactions, we recently announced the first patients dosed in our Phase 2 registration-directed trial of ziftomenib in NPM1-mutant relapsed or refractory AML. We expect to enroll a total of 85 patients in the United States and Europe. The primary endpoint is CR or CRh, and key secondary endpoints include duration of response, transfusion independence, safety and tolerability.

Dosing the first patients in our registration-directed trial of ziftomenib marks a significant milestone for our menin program and is a testament to the hard work and dedication of our team. The speed with which we’ve begun enrolling patients in the trial also speaks to the significant interest in ziftomenib among investigators. NPM1-mutant AML accounts for approximately 30% of new AML cases annually, and represents a disease of significant unmet need for which no approved targeted therapy yet exists. Although, untreated NPM1-mutant AML may pretend to more favorable prognosis upon initial diagnosis, the risk of relapse remains high and survival outcomes are poor after initial chemotherapy, particularly when other poor risk mutations, such as IDH 1 or 2 or FLT3 are also present.

Notably, in our Phase 1 trial for ziftomenib two-thirds of NPM1-mutant AML patients who achieved a CR at 600 milligrams had either IDH and/or FLT3 co-mutations, all of whom had failed prior treatment with IDH and/or FLT3 inhibitors. An additional NPM1-mutant patient who entered the trial with multiple co-mutations, including DNMT3A following 2 prior stem cell transplants also achieved a CR with no evidence of minimal residual disease, and remains on ziftomenib for more than 31 cycles as of the October 24 data cutoff. In addition to impressive activity as a monotherapy in patients with NPM1-mutations, we believe ziftomenib is well-positioned for future combination strategies. Our conviction is supported by several key competitive advantages including no evidence of drug-induced QTc prolongation, no predicted adverse drug-drug interactions and oral daily dosing that should enable convenient administration with standards of care.

Photo by Lucas Vasques on Unsplash

Our team is working diligently to initiate the KOMET-007 and KOMET-008 trials to evaluate ziftomenib in combination with current standards of care in earlier lines and across multiple patient populations, including NPM1-mutant and KMT2A rearranged AML. We’ve designed these Phase 1 studies to assess the safety, tolerability and therapeutic activity of ziftomenib in combination with key regimens such as venetoclax and azacitidine, gilteritinib and 7+3. Our approach is to establish a foundation where ziftomenib can be combined safely with various commonly used regimens, and then prioritize those combinations that represent the largest populations and greatest potential commercial value, primarily venetoclax and FLT3 containing regimens. In particular, we believe ziftomenib has potential to combine more safely and effectively with FLT3 inhibitors relative to other menin inhibitors in development.

Notably, up to half of NPM1-mutant AML patients also exhibit co-mutations in the FLT3G . We also believe that rational combination approaches will help to mitigate differentiation syndrome in the KMT2A-rearranged population, as has previously been demonstrated in the development of IDH inhibitors in combination with azacitidine. We’re very excited about the potential for our combination studies to further unlock the value of ziftomenib for patients with acute leukemias. We anticipate initiating the first of these studies KOMET-001 in the first half of 2023. We continue to have strong conviction in ziftomenib and its potential to be the best-in-class menin inhibitor. And we continue to prioritize investment in the program, including significant investments in NDA preparedness, as well as combination studies.

We look forward to sharing further updates on the program as the year progresses, including presentation of a more mature dataset from our Phase 1 trial of ziftomenib and NPM1-mutant AML at a medical meeting in mid-2023. Now, let’s turn our attention to our farnesyl transferase inhibitor programs. Over the past several years, we’ve pioneered the development of FTIs as combination agents to delay or prevent emergence of resistance to certain classes of targeted therapies in large solid tumor indications. Our preclinical data is supportive of FTIs in combination with a growing number of targeted therapies, including EGFR inhibitors, and PI3 kinase alpha inhibitors, as well as tyrosine kinase inhibitors in renal cell carcinoma, and KRAS G12C inhibitors in lung cancer.

Our next generation farnesyl transferase inhibitor KO-2806 was developed with these applications in mind. KO-2806 was designed to improve upon potency, pharmacokinetic and physicochemical properties of earlier FDI drug candidates. Last month, we were pleased to announce FDA clearance of the investigational new drug application for KO-2806 for treatment of advanced solid tumors. We intend to evaluate safety, tolerability and preliminary antitumor activity of KO-2806 in a Phase 1 dose-escalation trial, which we’re calling FIT-001 as a monotherapy and in combination with other targeted therapies in adult patients with advanced solid tumors. Clearance of the IND for KO-2806 marks an important next step for this program, and we look forward to starting FIT-001 in the third quarter.

Meanwhile, we continue to evaluate tipifarnib in combination with PI3 kinase alpha inhibitor alpelisib to address larger genetic subsets of HNSCC patients. In October, we reported the first demonstration that the combination of tipifarnib and alpelisib can induce a durable clinical response in a PIK3CA-dependent HNSCC patient at the EORTC-NCI-AACR Molecular Targets and Cancer Therapeutics Symposium. Notably, a patient with stage III squamous cell carcinoma of the tonsil with a PIK3CA mutation has achieved a durable partial response in our KURRENT-HN trial, and we have continued on study for more than 27 weeks as of the September 14 data cutoff. Treatment-related adverse events in KURRENT-HN are consistent with the known safety profiles of each drug and are manageable, with no dose-limiting toxicities reported to date.

Our team is now focusing its efforts on identifying a recommended Phase 2 dose and schedule for the combination with a goal of determining the optimal biologically active dose in mid-2023. In an ongoing effort to prioritize those programs with highest potential to create value for patients, health care providers and shareholders, we’ve decided to close our current lung trial and discontinue further development of tipifarnib in combination with osimertinib. We believe taking this disciplined approach enables us to enhance our focus on those development programs with the highest potential value, namely ziftomenib and KO-2806, while maintaining a strong cash position. Finally, in support of our ongoing corporate development strategy, we were pleased to announce a $25 million equity investment from Bristol Myers Squibb in the fourth quarter.

The equity investment from BMS strengthens the relationship between our organizations and provides us with key insights and expertise. We’re pleased to have the confidence of the BMS team and excited to work with them to deliver innovative science with the potential to benefit patients. With that, I’ll now turn the call over to Tom for a discussion of our financial results.

Tom Doyle: Thank you, Troy, and good afternoon, everyone. I’m happy to provide a brief overview of our financial results for the fourth quarter and full year 2022. I invite you to review our 10-K filed today for a more detailed discussion. Research and development expenses for the fourth quarter of 2022 were $22.7 million, compared to $21 million for the fourth quarter of 2021. R&D expenses for the full year of 2022 are $92.8 million, compared to $84.7 million for the prior year. The increase in R&D expenses was primarily due to increases in clinical trial costs related to our ziftomenib program offset by decreases in clinical trial costs related to our tipifarnib program. General and administrative expenses for the fourth quarter of 2022 were $12.5 million, compared to $12.1 million for the fourth quarter of 2021.

G&A expenses for the full year of 2022 are $47.1 million, compared to $46.5 million for the prior year. Net loss for the fourth quarter of 2021 was $33.1 million, compared to a net loss of $32.7 million for the fourth quarter of 2021. Net loss for the full year 2022 was $135.8 million, compared to a net loss of $130.5 million for the prior year. Net loss for the fourth quarter and full year 2022 included non-cash share-based compensation expense of $6.8 million and $26.3 million, respectively. This compares to $6.4 million and $23.6 million for the same periods in 2021. Our cash, cash equivalents and short-term investments were $438 million as of December 31, 2022, including the $25 million equity investment from Bristol Myers Squibb and a onetime $10 million draw from the Hercules loan facility.

This compares to $518 million as of December 31, 2021. We believe that our cash, cash equivalents and short-term investments will be sufficient to fund our current operating plan into the fourth quarter of 2025 assuming no further draws on the debt facility. With that, I now turn the call back over to Troy.

Troy Wilson: Thank you, Tom. Before we jump into the question-and-answer session, let me lay out our anticipated milestones for this year. For ziftomenib, dose the first patients in the KOMET-007 combination trial in the first half of 2023. Present updated data from the Phase 1 trial in NPM1-mutant AML at a medical meeting in mid-2023 and dose the first patients in the KOMET-008 combination trial in the second half of 2023. For tipifarnib, determine the optimal biologically active dose in the KURRENT-HN trial in combination with alpelisib in mid-2023. And for KO-2806 dose the first patients in the FIT-001 dose-escalation trial in the third quarter of 2023. With that, Rob, we’re now ready for questions.

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Q&A Session

Operator: Thank you. At this time, we will be conducting a question-and-answer session. Our first question comes from Jonathan Chang with SVB Securities. Please proceed with your question.

Jonathan Chang: Hi, guys. Thanks for taking my questions. First question on the mid-2023 Phase 1 KOMET-001 update, can you help set expectations around what information you plan to share and clarify whether this updates for NPM1-mutant patients only. And then the second question on the Phase 2 portion of the KOMET-001 study in NPM1-mutant patients. How has the early experience shaped your thinking around timelines for the study? Thank you.

Troy Wilson: Thanks, Jonathan, for the questions. So starting with the update that we anticipate in mid-2023, we do intend to focus that update on the patients with NPM1-mutant AML, who were enrolled in the Phase 1 study, and the intent there is to provide an update on all the patients in the study. Obviously, one of the key questions at ASH was the durability of response and we’ll be in a position to provide a significantly more mature dataset. But as is customary, we’ll give a full clinical update on all the NPM1-mutant patients on the study. And recall there were 20 NPM1-mutant patients dosed at the 600 milligram dose. In terms of the experience in the Phase 1b and the timing for the Phase 2, I think, that’s your second question.

It’s still early, I mean, we’ve been very encouraged, we were deliberate to say that we had dosed multiple patients. When we first put the press release out, announcing the initiation of the study, and interest among and enthusiasm among the investigators has been robust. We’re still in steady startup that will take really the first €“ fully through the first quarter here in the U.S. But every week that goes by we have additional sites coming online. And as you recall, when all the sites were up and running in the Phase 1b, we dosed 14 NPM1-mutant patients in 3 months. Here, we’ve got to get to steady state in the Phase 2, but we’ll have more sites from which to draw, and we expect to see robust enrollment.

Jonathan Chang: Got it. Thanks for taking my questions.

Troy Wilson: Thank you.

Operator: Our next question is from Roger Song with Jefferies. Please proceed with your question.

Roger Song: Great. Thank you for taking the question. Maybe just quick 2 questions for ziftomenib. One is given the very strong data from Phase 1b, have you started a conversation with the FDA regarding the PTD potential? And the second question is around the Phase 2 statistical assumption, given you’re enrolling 85 patients, what is the null hypothesis you try to clear for enroll this 85 patients? Thank you, Troy.

Troy Wilson: Yeah. Thanks, Roger, for both of those questions. So, on the question of PTD, maybe stepping back for a second. We intend to take advantage of every development and regulatory strategy, we can to accelerate the development, to accelerate time to market and overtake our competition. And I don’t want to be specific on our interactions with the agency. As everyone recalls, we were very measured in giving guidance around our FDA interactions around the Type C meeting. I’ll just tell you that, again, I’ll reiterate anything that we can do to accelerate the timelines we intend to do. We certainly feel like we have a very strong dataset with a 30% CR rate with full count recovery. And NPM1-mutant relapsed/refractory AML is clearly a high unmet medical need.