Agios Pharmaceuticals, Inc. (AGIO) Earnings Call Transcript & Summary

Great. Good afternoon, everyone. My name is Tyler Van Buren. I'm the senior biotech analyst at Piper Sandler. Welcome to Piper's 32nd Annual Healthcare Conference, but this is our first time with a virtual format. We appreciate you all logging in. And for this session, it is my sincere pleasure to have Agios here with us. And from Agios, we have Jackie Fouse, the Chief Executive Officer. Jackie, thanks very much for being here with us.

Hi, everybody. Thanks for having us, Tyler.

[Operator Instructions] But maybe we could go ahead and get started with a general question. Jackie, you're wrapping up your second year as CEO, and you continue to refine the business and the pipeline. So maybe you could start by describing how you believe the company is positioned today, what your top priorities are for 2021, and if that long-term guidance by 2025 is still intact?

Great. So yes, 2 years in the job with one of them being in a pandemic year, so it's been quite a journey so far. So at Agios, we remain the leaders in IDH inhibition, and that's kind of how -- I think about the business in a couple of different ways: one, around our IDH franchise and then now our emerging PKR activation portfolio and the things that we have going on there in the non-oncology space. So what you saw over the course of 2020, and I think this would -- many of the aspects of what we achieved in 2020 will be consistent, I think, on a go-forward basis in 2021. So I think the performance of TIBSOVO in the commercial space in IDH1 inhibition was quite strong. In 2020, you've seen the latest guidance that we've given on that. We will continue to be focused on making the most of our only marketed product that we have today, and we try to do everything that we can to get the most of that platform. So we have now the results from our cholangiocarcinoma trial. We'll be filing for that next year. So the glioma trial that we initiated at the end of 2019, even despite the pandemic has received a very strong reception from investigators and patients, and it's done quite well from an enrollment standpoint despite the COVID-19 situation. So everything progressing well on the IDH front, and you'll hear more of those sorts of things in 2021. We're really, really excited about the developments in -- with mitapivat, in particular, and our PKR activation platform. So you saw the ACTIVATE announcement this week I'm sure, and we're quite happy about those results and look forward to presenting the full dataset next year. So what you'll see from us in 2021 is ongoing focus on strong execution around the mitapivat program, we'll be filing for PKD. We look forward to the ACTIVATE-T, the transfusion-dependent population for PKD Phase III trial result in Q1 coming up, and we will be initiating the trials, the pivotal programs for thalassemia and sickle cell disease. So at ASH, you will hear about the trial design for thalassemia. And then as we get into 2021, we'll be talking a bit more about the sickle cell trial design. So we know it's a competitive environment. We know we're not the only company with the molecule in this class, so we're going to be very, very focused on strong operational execution. And I thought you -- I think you saw that from us this year. The other thing I would say in 2021, we're seeing more come out of our research group about the opportunities that we have with the PKR activation and PK activation in general. And so we are going to look forward at the right moment to sharing more with you about how we see that research pipeline evolving and all the things that we got going on there. So the 2021 is looking great. We'll talk more about the TIBSOVO revenue guidance early in the year. And on the '20 -- I'm really sorry, on the 2025 target for $1 billion, so despite the virus and some of the things that we've seen there, and I would say, encouraged by our TIBSOVO commercial performance this year, we feel like that $1 billion of revenue is achievable despite a little bit of headwinds in 2020, we're very much on track with that. And we -- I'll remind you that a good bit of that was coming from TIBSOVO revenues in AML, some from cholangio. We also had PKD in that number. And then some modest contributions for the approvals that we have late in that time horizon of 2025 with glioma and thalassemia. At the time, when we gave that you may remember that we didn't have our plans as fleshed out for sickle cell. And so now we've got -- and you'll hear more about that next year as well. Now we're able to refine our time lines for how we're thinking about the sickle cell trial and potential readout and approvals. And so I think we are going to end up in a situation where we've got multiple ways to get to that $1 billion revenue target. So we're feeling -- we feel as good about it today as we did a year ago.

Okay. That's very encouraging to hear you reiterate that. And thanks for that overview. Just a quick follow-up. That was interesting that you said on the research group and PKR activation group, you said more coming out of that research group potentially. Are you thinking more applications and more indications or potentially more assets or, e, all of the above?

All of the above, I would say. So you know we have 9 for 6 in healthy volunteers now, and that gives us some optionality despite the fact that we think we've got a blockbuster drug in mitapivat across a variety of hemolytic anemias. So there are other hemolytic anemias that we could go into. We have assets in PKR activation behind 946 as well, and we have some other things going on both within PK activation and outside of that mechanism and some other mechanisms that you'll hear about in due course. So we think that we've got the ability to address a broad range of hemolytic anemias, and we're seeing some emerging science that gives us potentially options to go into some other areas as well that we would think through as we see what kind of data we're able to generate for those. So we're very excited about it. We -- historically, I think people have thought us about maybe mostly in terms of cancer. And now with mitapivat having proven itself, I think, over the last few years and as we continue to see that dataset of all the things, people now see the potential application for the cellular metabolism platform outside of cancer, and I think it's going to go beyond mitapivat and 946, for sure.

Yes, very interesting. It sounds like you guys are trying to dominate the nonmalignant heme space, but -- and we'll spend most of our time on PKR activation and mitapivat, but maybe before that, just a question on TIBSOVO, on the last quarter, you guys mentioned some negative headwinds, I think, pandemic-related headwinds of Medicaid pricing, fewer patient starts. So just confidence in you all being able to achieve your guidance for the year of, I think, it's $113 million to $115 million and also double-digit growth next year and moving forward.

So we tightened that guidance range to the upper end of our original range despite the pandemic situation this year. We've had a good start to Q4. And as we updated that guidance and tightened the range, we took into consideration some of the headwinds that we think the -- frankly, the whole marketplace and health care could experience in Q4 and maybe even into next year as we see the ongoing effects, both for the healthcare system as well as the economic macro-environment related to the pandemic. So it -- we maybe expected to see a little bit more of that than we've seen so far this year. So we've got that baked into our current guidance, and we'll be thinking about it as we go into 2021 as well. I think we've -- in some respects, the situation may have favored oral oncolytics in terms of patients, the ease of patients being able to take an oral medication versus some other modalities and things like that. So we've been encouraged by that. And AML is a serious enough disease, while there may be some delays in patients getting diagnosed and going for treatment. We think that maybe they're not as much as for some other diseases. So we've been happy with our commercial execution, and we'll look forward to giving you TIBSOVO guidance for 2021 early next year. We think there's still a lot of opportunity for growth for TIBSOVO.

Okay. Great. And on the business development front, are you guys spending a lot of time there? Could we see you potentially do a licensing deal either in or out of the organization?

We -- our focus has been and continues to be mainly on executing on the internal opportunities that we have. The -- we've got so much going on that, I think, that probably represents the best value for shareholders. At the end patients -- at the same time, we always keep an eye on emerging science. In the past, we've tended to be more focused on opportunities around early-stage assets that might be complementary to things that we're doing ourselves in our research organization. And I think that would continue to generally be the case that's probably more the sweet spot for us at Agios versus contemplating some later-stage acquisitions. But we do keep our eyes on anything that might impact a space that we're thinking about operating in, whether it's with an internal program or just knowing what's going on out there in case if an appropriate BD opportunity does present itself. With some of the indications that we have coming from mitapivat, we know that the geographic disposition of the patients with the different diseases that we're moving into is different than maybe AML or IDH mutation. So we're looking at that. Thalassemia is a good example where everybody knows there's a good opportunity outside of the U.S. and Europe. So we'll be looking at those sorts of considerations as we think potentially about partnering to optimize the global opportunity of any of the indications that we take our medicines into.

Okay. Great. Let's go ahead and get into mitapivat. I want to start with PKD. There's, obviously, such an acute focus on sickle cell because it's the largest patient population, but feel like people are kind of forgetting about the franchise and the broader opportunity across all 3 indications. I mean, if you guys were successful, you could have 3 launches and 3 indications potentially over the next 5-or-so years, which is pretty interesting to think about. On the -- and obviously, the ACTIVATE trial was successful here very recently. So maybe just provide your high-level thoughts on the ACTIVATE data. Do you feel -- we obviously need to see more EHA next year, but based upon what you're seeing so far, does it look consistent with DRIVE PK? And how does it make you -- how does it -- how do you guys feel now going into the ACTIVATE T readout?

So of course, we're thrilled to have a positive -- our first positive Phase III trial outside of oncology, and it's been -- we feel like we're the leaders in PKR activation. We've been doing this for a little while. Now the drug's got data in patients for 4-plus years, and we've been doing research on it for quite a while. So we're just really happy to see the trial result. You saw the headline numbers. We clearly did better than what we had assumed in our stats plan. So we're happy with the results. We talked about the key secondary endpoints that we have in hand. We don't yet have the PRO data so that that will take a little bit longer, but everything that we have in our hands was highly statistically significant. So we're very pleased with the results, and we look forward to presenting that data, the full dataset at EHAs. When we think about the ACTIVATE T trial -- transfusion-dependent patients are a little different, but the mechanism works in the same way. So let's keep our fingers crossed because we don't have it until we have it, but it's not that far away. So people can be on the lookout for that in Q1, and we got the team working very hard right now already to take the activate day to start to populate the NDA submission, and then we can drop in ACTIVATE T. So the goal is to file the 2 things together because the trials are reading out fairly close to each other. If it was going to be a long delay, we might do it differently. But we're optimistic about the ACTIVATE T, and so let's see where we go with that, but I think your point is very well-taken. The -- I think I know there is some skepticism out there around the size of the opportunity with PKD. The more work that we do in this area, and we've been doing a fair amount for a while now and we've got to know the patient community and physicians who treat the disease and other hemolytic anemias. And once you have an approved product, there's a good chance that diagnosis goes -- rates go up, and patients today who would love to have a treatment option and physicians who would love to have treatment options for them, I think they're going to be paying a lot of attention to this drug. And so we are always pretty conservative in terms of our assumptions around revenue ramps and things like that. We like to under-promise and over-deliver, and I think we've seen a lot of enthusiasm in the community for mitapivat. So I think PKD is going to be a very nice indication for us. It can give you the opportunity to create a halo effect around a brand when you're building a brand across multiple indications as you know. And when we think about thalassemia, we're the only company that has generated human data in alpha thalassemia. And then you get into a discussion about, 'do those patients really need to be treated' and all of that sort of thing. But again, when there's a treatment option, you may see those patients get treated more than they do today. And so far, the data has looked good in thalassemia. And you've seen the sickle cell data that we think looks good as well, and you'll see a little bit more of that data at ASH. So I frankly think that PKD and thalassemia are somewhat underappreciated or taken for granted, that maybe the best way to put it, and I get it in terms of the number of patients in sickle cell disease and the high unmet medical need and all the rest. So we like the mechanism in all of these indications. We like the mechanism of PKR activation in sickle cell because we think there is the potential for not only increasing hemoglobin but potentially reducing vaso-occlusive crises as well, and we'll be looking to address that in our pivotal program for sickle cell that we will move into next year. The thalassemia pivotal will have both transfusion dependent and nontransfusion dependent. We'll have alpha and beta. So we're working through that. You'll hear more about trial design at ASH, but we're looking to go for trials that will give us broad labels in each of these indications.

That's great. You knocked off like the next 10-questions for me there but...

Because you said them to me ahead of time, I knew how to help you get squeezed them all in 25 minutes.

It's not easy. That's perfect. But on, I guess, just one follow-up on PKD. So it makes sense that you're waiting for the ACTIVATE T results to file the NDA. So when you file, you'll essentially have both patient populations potentially included in the label. I mean, that should cover the vast majority, if not all, PKD patients, right?

Yes. I mean, I think you've got also the -- now remember, there's a couple of mutations that mitapivat doesn't work as well in and some things like that, but again, as soon as we have a treatment option for a serious disease where there is no options, you're going to get people to try it and see how it works. So I -- yes, I'm pretty optimistic about it. We've done some additional things. We continue to identify patients. The numbers increase a little bit all the time. We've done a lot of different things there, the natural history study that you know about, the PEAK Registry in our trials and working with patient groups and everything else. And then you saw us earlier this -- we -- I think it was this week, we announced an initiative called Anemia ID. So we're trying to help the community with respect to diagnosis, and we think that's going to provide a service for patients and physicians, and we're happy to do that and those sorts of things we will continue to do. So...

So -- yes. It seems like a pretty cost-effective way to acquire patients. So let's spend the rest of time on sickle cell. Just -- if I'm not mistaken, next Tuesday is when you guys are going to be having your webcast?

It's at 5:30 on the 7th, whatever day that is. I think it's Monday at 5:30. and -- I'm sorry, and Tuesday is the Investor event. Yes. The presentation by Dr. Thein is at 5:30 on Monday and then our investor event is Tuesday morning, you're right.

Okay. Yes, sorry. Exactly. So obviously, that is going to be a continuation of the data that we saw at EHA. So in terms of sickle cell, what data should we expect beyond what we saw in the ASH abstract and what should we be paying attention to?

Yes. So we'll spend most of the time at the investor event on sickle cell. We'll have Dr. Swee Lay Thein with us, so you'll be able to speak with her and she'll present. So she will present more data on the 8 patients that we talked about when we declared a proof-of-concept for the -- for mitapivat in sickle cell disease. So you'll get a little bit more detail on those 8 patients where we gave the high-level efficacy results back in June, I think, it was. We expect to have data on 3 additional patients. So as you'll remember, the trial was paused because of COVID-19 for a little while, started enrolling again in the middle of August. And there's 3 patients that have now finished. And so there will be data on 11 patients. And yet Dr. Thein will characterize that day to go through it. And yes, let's see what you think about it. So you'll be looking clearly for the ongoing efficacy update with that additional number of patients. She will talk about the safety data and the different things that she's seeing there. She'll talk about the other -- the secondary endpoints and she'll go through some of that. There will be data on a small number of patients that have the 100-milligram dose as that got added along the way, as you know. And I think she may mention the extension that has now been added in there, and I think that's going to be very interesting for the ongoing data generation that's going to be possible from that as patients will have the option to come back into the extension arm of that arm. We also have Dr. van Beers, who's launching his IST as well. So some ways to continue to generate data flow over into 2021 and beyond. So when people are saying, what's next? What's next? When am I going to have a better idea of how to think about this drug in sickle cell disease? We're trying to generate that flow of data.

Okay. Great. And I have a client that came through -- or I have a question that came through from a client. So they referred to the abstract, which you outlined, which I believe it was 8 per -- 8 patients per dose until you get to the 100 mg, which had the 2 patients, and you saw the hemoglobin of 0.9 instead of 1.2 with the 8 patients at the 50 mg. So the client asked how should we be framing expectations around the data at the 100 mg dose? We're going to get 3 more patients at 100 mg. Obviously, we're comparing really small numbers here, but I guess the question also there is just more broad -- in a broader patient population, do you think there are patients that are -- do you still believe that there will be patients that will benefit from the 100 mg dose?

So I think it's early days, right? As you said, it's a small number of patients. I think a couple of things to point out. When we originally declared proof of concept, we did that based on the 50-milligram dose. So we know there's nice response at 50 milligrams. I would also say, in this trial, while it's extremely interesting trial, we're very happy with the trial. The patients are also on for a relatively short period of time, and we know that what we've seen in thalassemia in terms of the time to response is a little bit longer than what we've seen in PKD because remember, we're activating wild top versus the mutant. And it -- so we're -- the longer patients are on drug, the better chance you have of seeing that response. They're on a fairly short period of time. So let's see what we get as we get more patients at that dose, and we've got some options, I think, in terms of how we take that forward, but we like what we're seeing so far.

Okay. Yes, a very interesting point there in terms of time to respond and improving over time.

Yes. I think in thalassemia was around 3 weeks, and in PKD, it's around 10 days. So you've got a little bit of a difference there, yes.

Okay. That's helpful. All right. And then we're not going to see any VOC data. Obviously, you guys are collecting VOCs, but to see an impact on VOC. Are we -- at some point, may we see something from this trial in terms of numbers? Or would you need to really wait to the pivotal trial to where that's going to be with designs?

I mean, my guess is just with the number of patients that we're going to have in this trial. There's probably going to be some information to glean how much you can draw conclusions from that. I think it would be a great question for Dr. Thein in the event, and I'm sure that she will talk about what she's seeing so far. She will talk about the other markers of hemolysis and go in to some of that as well.

Okay. Unfortunately, we're up on time here, but maybe just a final question. Do you have any kind of brief comments on the competitive landscape in sickle cell or nonmalignant heme, in general, and the opportunity that lies ahead for mitapivat?

Look, I think -- and our assumptions are that we're in just about any indication we go into. We're going to have to coexist with competition. I think healthy competition is great for patients, and it makes all of us better. So I look forward to that, but we think PKR activation, as a mechanism, has some strong rationale for being advantaged in -- for some patients in these diseases. And we think we need more treatment options. We like our programs a lot. We've been doing this for a while. In terms of the science, we think we understand it as better than everybody else, anybody else does in terms of PKR activation specifically. And so we look forward to being on the market and competing and doing great things for patients.

Okay. Wonderful. Well, on that note, Jackie, thanks so much for your time and your thoughts.

Thanks, Tyler. Thanks everyone.

Thanks everyone for logging in.

Take care.