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

Good morning, everyone. Thank you so much for joining us. We're really pleased to have with us the Agios team with us, we have Brian Goff, Chief Executive Officer; as well as Sarah Gheuens, Chief Medical Officer. So to start, Brian, I'm going to turn it over to you for any opening comments. .

Well, thanks a lot, Salveen. Thanks for hosting us. And for those of you who got up pretty early this morning to listen in, thank you very much. It's an exciting time at Agios. And as a snapshot, I think many people know that Agios is focused on rare diseases, and the core of that focus is on red blood cell health. Our lead product, mitapivat, is really the leader in a class called PK activators or pyruvate kinase activation. And I must say we have just made excellent progress this year. Our focus therapeutically is PKD, which is pyruvate kinase deficiency where mitapivat or commercially known as PYRUKYND is already indicated and launched in the U.S. But we're also pursuing further indications in thalassemia and in sickle cell disease. And as I noted, the momentum is just great. So in January of this year, we announced top line results from the first of our 2 pivotal Phase III trials focused on thalassemia. And the first trial is known as ENERGIZE and that's focused on non-transfusion-dependent thalassemia patients. We were really thrilled with meeting the primary endpoint statistically, not only in hemoglobin improvement, but in the very difficult to attain patient PRO finding of fatigue through the facet fatigue scale. So that was in January. And we followed that up just last week, on Monday, we announced the top line results for the second of those 2 studies. That's known as ENERGIZE-T and the T is because the study focuses on the transfusion-dependent thalassemia population. And I know Sarah sitting to my left, will be delighted to talk about the results. But suffice it to say, we achieved statistical significance on the primary endpoint of transfusion reduction. We also achieved statistical significance on all 3 of the key secondary end points which largely were focused on duration of or durability, I should say, of the transfusion reduction and we also had a really impressive finding of transfusion independence in almost 10% of the patients. So now we are prepared to combine the results of those 2 studies and package up a file with the FDA by the end of this year. And meanwhile, our commercial team is gearing up for a potential launch next year in 2025. So that's just -- the timing of this discussion for us is just superb. We also are advanced with another indication, as I noted, sickle cell disease last year, about this time, we announced the Phase II results of the RISE UP trial in sickle cell disease, and we're really pleased to see both statistical significance in hemoglobin improvement as well as a positive trend in vaso-occlusive crises. We followed that up very quickly with commencement of enrollment of the Phase III portion of that Phase II/III study and the goal there is to be fully enrolled by the end of this year, get data from the sickle cell study next year and then the setup for Agios as potential back-to-back launches, thalassemia next year and sickle cell disease in 2026. So a lot of momentum. The last thing I'll just say from a balance sheet perspective is our CFO, Cecilia Jones, just did a fabulous job of setting up a very competitive process for monetization of a royalty that we held for vorasidenib approval in the U.S. that's now owned by Servier. We had 15% royalty upon FDA approval of U.S. net sales and thanks to the competitive dynamic, that resulted in $905 million upon U.S. approval, which will be added to our balance sheet. That is in addition to the other milestone that we still retain, which is $200 million from Servier upon FDA approval. And I'll just note, too, that we still retain 3% of annual U.S. sales that are above $1 billion even after that monetization. So we have had a very positive breathless year-to-date in 2024, and we're just thrilled about the momentum and the opportunity to serve patients in a broadening set of indications.

And really nice to see. So starting with the data sets that we saw, could you help us understand them and talk about how they be viewed in the commercial setting? -- specifically in ENERGIZE-T, there was about a 30% reduction in transfusion burden compared to a 12.6% reduction in the placebo arm. Help us understand the rate of reduction in the placebo arm and then the context.

Yes, maybe Sarah can start with why we designed the study as such, and then I can build on the commercial applicability of the findings.

Right. Thanks. So the primary end point was a 50% reduction in any rolling 12-week period within the clinical trial. So there was a 48-week observation period. And then if a patient had a 50% reduction in any given 12 weeks, that was considered a responder. So we had modeled for a placebo rate using all of the luspatercept subdata, looking at all of the confidence intervals around that. So we had taken into account that we could have potentially a higher placebo rate than what was observed before, and that effectively occurred in this trial. So we were very happy that we made the assumptions we have made. But I think the key message here is that even with a high placebo rate, we were able to demonstrate statistical significance on the primary endpoint, where I think the true special data comes in is in the key secondary endpoints because that is where we have longer stretches of duration. And the last end point is a 50% reduction over a stretch of 36 weeks between week 13 and week 48, and we were able to hit statistical significance on all of those endpoints as well. And then the transfusion independent, of course, we were very pleased to see that data as well because being away from clinic for 8 weeks with an oral therapy is really meaningful for patients. And so that is where I think the way we have looked at drug effect across the clinical trial can really provide a comprehensive package for people to make calls on the therapy.

And then commercially, for just this trial alone, this sets a very high bar for all other therapies that are pursuing thalassemia. And for patients themselves, this is potentially transformational because, for one, the transfusion reduction is very meaningful at 50% reduction. We knew that, that was a high [ BARDA ] set, and we thought that was quite relevant for the population. Two is in the secondary end points, what's so exciting is we've now seen that up to 36 weeks. That effect is maintained. And that's the first ever in a prespecified endpoint in a pivotal Phase III study in thalassemia and then transfusion independence, as I noted, it's almost 10% of the population that studied, that achieved transfusion independence. But with mitapivat, which is an oral therapy, it's kind of a different level of independence. One part is the independence of the transfusions themselves, but the other, which is ultimately our goal is to help the patients become independent of the clinical setting. And that is very compelling for these patients and I think a really unique attribute that we'll look to leverage in our communications about this during the launch.

In both the ENERGIZE and ENERGIZE-T studies, you included both alpha and beta-thalasemia patients and noted that neither subgroup drove the positive response as seen in the trial. Could you provide any further details on the respective efficacy of these 2 groups? And how confident are you in being able to include both these populations in your label?

So for the energized trial, that's the trial that was focused on nonregularly transfused patients. We had a stratification factor on alpha or beta geno type. And so we have indeed spoken about that there was not a subgroup that drove the overall efficacy results and the data will be presented at EHA on Saturday. So you can see more there, but we are very pleased with that because it doesn't mean within that trial that we were able to observe that there is drug effect across those different patient populations. For the ENERGIZE-T trial, we did use another stratification factor because alpha-thalassemia patients overall in the thalassemia patient population are less commonly transfused than beta-thalassemia patients. So we used a stratification based on non-beta-zero/beta zero versus a beta zero/beta zero and then included the alpha-tal patients in the non-beta-zero group. And so again, here, we are pleased to see that stratification factor, there is not a specific subgroup driving the overall efficacy results. And of course, our goal is to present a similar data package like what we are doing now at EHA for ENERGIZE to have the same type of presentation for ENERGIZE-T at a later upcoming medical meeting.

And again, from a commercial perspective, the beauty of both data sets, ENERGIZE and ENERGIZE-T is we don't have to get into nuances about the data for this subpopulation versus the other. The target product profile is that all of thalassemia is covered. And now thanks to the data from ENERGIZE, which addresses as Sarah says both alpha-thalassemia and beta-thalassemia patients who are nontransfusion dependent and now ENERGIZE to cover the other 1/3 of the population, which is transfusion dependent, but not having to nuance about subtypes, that's an incredible opportunity for this population.

And at EHA, you plan to share additional measures, including of fatigue, including other physical functional and thalassemia symptoms, how meaningful do you think that would be additive to kind of the overall data set that we've seen to date?

So that data will be presented on Friday, and it's truly an overview of the patient reported outcomes and performance measures that we had collected in the ENERGIZE trial, and it shows consistency across the different tools that we've used. So I think it's very meaningful because it does speak to how people feel and function on drug when they have thalassemia. So it's a very comprehensive data package with a whole range of efficacy measures that we believe can speak to clinical benefit.

When we think about nontransfusion-dependent thalassemia, there is a view sometimes that it's not severe life-threatening given the lack of a need for transfusions. In that context, how do you think about adoption in this population and the commercialization education efforts really needed to kind of educate and gain kind of momentum.

Got trial piece. But the nontransfusion-dependent patient population, I think where we can first see that people actually do want a therapy for their disease is the fact that the trial enrolled and we had a good enrollment in that clinical trial because typically, when people don't want to participate or don't feel like they need something to tackle their disease, you have trouble with your clinical trial on an execution perspective. And so I think that's one of the signs from a patient population, a patient population level that both physicians and patients have an unmet need and have an unmet need that makes them want to participate in a clinical trial. From a medical perspective, there is a lot of data out there right now that non-transfusion-dependent patients actually do develop severe comorbidities and have an increased mortality that can be even worse than people who have been transfused. And so there is definitely from that content, medical content and unmet need as well because these comorbidities, they continue to build up, specifically driven by hemolysis and iron overload that those patients also deal with despite now being regularly transfused.

Yes. And this -- and you're exactly right, Salveen. This is classic rare disease preparation, especially when you address populations that have had limited or no therapeutic options. And in this case, in thalassemia, the nontransfusion-dependent population if I focus on the U.S. is about 2/3 of the total thalassemia population, and they've had essentially nothing that's been approved for their treatment. So the classic approach is, there will be a lot of education that will need to be done. Tsveta Milanova, our Chief Commercial Officer, has already begun to build out her team, which we held off doing until we saw the disposition of the ENERGIZE data in January and given how positive it is and now ENERGIZE-T, we're really preparing first with education, which actually began in earnest on May 8, which is world thalassemia day and the focus there, as Sarah noted, is, number one, to make sure that clinicians are increasing their management and monitoring of these patients; and number two, from an educational standpoint, it's the realization that they have a hemolytic anemia. These nontransfusion-dependent patients, and that means that they have ineffective erythropoiesis, as Sarah noted, and every day, they suffer from chronic hemolysis, which in the long run can really affect morbidity and mortality. So that's the crux of our focus. I think what we'll see from a launch perspective is a gradient over time of as that education really resonates with the community as well as patients having an opportunity to try the product, and we believe word-of-mouth effect will be an important component and then we'll expand from there.

On the potential to commercialize ex U.S., you've noted that you're actively looking for a partner to commercialize globally. Can you provide an update on the efforts here?

Well, the first update is you can imagine if you're a potential partner and you see both of these data sets from ENERGIZE and ENERGIZE T, that's a very compelling proposition. And so we've had no shortage of interest around the world. Our core focus outside the U.S. really #1. And number 2 for us is the Gulf region, the GCC. And our approach there is most likely a distributor-type of approach. . And there are many types of distributors. What we'll be looking for is the so-called full-service distributor we can work very closely to, as we just talked about, be in sync around the educational messages that are required to mobilize the population, make sure that access is very strong and the Gulf is a remarkable opportunity. In the U.S., we talk about 6,000 diagnosed adult patients with thalassemia. The gulf thalassemia population is about 70,000 patients. So that really is our keen focus. And then from there, we'll continue to look for what the right approach is to commercialize, but those are really our top 2 priorities.

Other competitor programs within the PKR class such as Novo's asset.

There's really -- I guess, there's not a lot to be said. We haven't seen any data. And -- if anything, we have a very meaningful lead now at this point with 2 positive Phase III trials. I think beyond just PK activation class, just in total, as I noted, this is a very high bar. We have demonstrated in 2 different studies, hemoglobin, beyond -- hemoglobin aspects, real outcomes for the patients and ENERGIZE, we showed benefit for fatigue which is critical at the patient level. And now in the ENERGIZE-T study, as we've talked about, we showed very meaningful benefit in transfusion reduction. We've shown durability of response. And ultimately, if you're really trying to be free of the burden of clinical treatment and oral therapy is quite meaningful.

Great. Transitioning over to PYRUKYND in sickle cell disease. Where do you stand right now with enrollment progression for the Phase III trial?

I will just start by saying I'm very proud of what Sarah does every day. and this is another mark of excellence in the progress we're making.

And I'll add to that, that I'm very proud of the whole clinical team that is actually working on this because it is it takes a village to get to these trials to the finish line. So we had enrolled our first patient relatively fast after we completed our Phase II clinical trial data set, which we were very excited about because it was -- it highlighted that we had a positive hemoglobin response, but then also we saw a trend on hemolytic parameters and on sickle cell pain crises, which is, of course, now the focus of our Phase III clinical trial design with 2 primary endpoints: 1 focused on hemoglobin and 1 focused on a reduction in sickle cell pain crisis with the goal to deliver a therapy that could treat the totality of sickle cell disease. And so where we are now with the clinical trial execution, we have guided towards a complete enrollment by the end of this year, and we are on track to do so.

In the Phase II RISE Up trial, the drug demonstrated a significant improvement in hemoglobin response rate. Help us understand or could textualize this as we look to the context of read-through to vaso-occlusive crises for the Phase III.

Right? So what we saw in the Phase II beyond that statistical significant result on the hemoglobin response, which we actually leveraged to select the dose for Phase III, we also saw a trend in sickle cell pain crisis and a trend in hemolytic parameters. And what was nice to see when in that clinical trial data, it was against placebo, right? So it's a first Phase II placebo-controlled clinical trial data set that showed that both doses had a trend towards improvement on hemolytic parameters and sickle cell pain crisis, but you saw a better trend in the 100-milligram dose. And so that is where you can see that consistency in the data set, which gives us confidence for Phase III. And then in addition, we have 2 investigator-sponsored trials that have been ongoing for a while now, 1 at the NIH and then 1 in the Netherlands that continue to show similar data. So it's the totality of the data and the consistency of the data across the whole program that makes us excited to try to deliver to that goal of completing enrollment in Phase III.

What differentiates the asset from other agents in the PK activator class or just the overall sickle cell therapeutic class here in your viewpoint.

So I think from a PK activator against others, as I mentioned in our Phase II, this is the first drug that actually delivered and the hemoglobin response and that clear pattern across all of the hemolytic parameters and the sickle cell pain crisis at the same time. So that gives us confidence towards our goal of delivering a therapy at the end of Phase III that can truly tackle totality of sickle cell disease, and that's the differentiator because right now, people have choices between a drug that focuses on the anemia component of the disease or on the sickle cell pain crisis component of the disease. So our goal is to really try to deliver for the totality of the disease with this therapy. So that would be a major differentiator there. And then within the PK activator class, we have an pan-PK activator. So we activate PKR, which is important in the context of the red blood cell metabolism, but we also activate PKM2 which is expressed in different tissues across the body, which we are now exploring the potential benefits from as well in a renal study. So we are actually in sickle cell disease. There's a lot of organ damage. PKM2 is expressed in renal tissue. We're trying with this study to highlight if we can measure improvement in kidney health in sickle cell disease. And that is important because the kidney is 1 of the target organs that get damaged in a lot of patients. So if we can show some improvement there that would be very meaningful for the patient population.

And what are the clinical and commercial bars here for this readout.

So I think the clinical bars there is multiple ways to think about that because, of course, our goal would be to be positive on the hemolytic anemia component and the sickle cell pain crisis component. But what we're trying to deliver to is that hemoglobin plus story, as Brian mentioned before with hemoglobin that leads to people actually feeling better. So that would be a very meaningful clinical bar, if we can deliver on that.

Yes. Then, commercially, it's the same dynamic that we just talked about with thalassemia. These are -- these are patients who have very limited treatment options. And as Sarah noted that it's all about not forcing the patient to have to make a choice and trade off 1 of the real benefits that they need. And just like in thalassemia, where we've seen hemoglobin plus benefits, it will be the same thing in sickle cell disease. And we are eager and preparing for success. In fact, commercially, as I noted, now we're expanding so that we're prepared for a potential thalassemia launch in 2025. And then that could be back to back with sickle cell in 2026.

PYRUKYND in PKD for the treatment of PKD has been on the market for a little over 2 years. What are your thoughts now as you think of the forward trajectory and maybe what needs to be done to further penetrate this market?

Well, I think with PKD, what's been really elegant about this in preparation for successively larger launches to come, whether it's thalassemia and/or sickle cell disease is that this has been a great real-world platform for us to see actually how mitapivat PYRUKYND performs in the real world and as we've talked about in other venues, we continue to be really pleased with the persistency that we see. These patients are admittedly very challenging to find to have clinicians diagnose and identify them, but once they're on therapy, the persistency and the way the patient feels is very compelling, and it's given us a good read through to what it might be like on chronic therapy, whether it's thalassemia or sickle cell disease. The numbers for PKD will continue to be slow and steady. And you can imagine now with optionality of expanding our indication base, we're going to focus a lot of our efforts on thalassemia. And hopefully, if the data guides us there on sickle cell disease as well. But for PKD, slow and steady and using that as a proof point for real oil real-world PRYUKYND use as well as a platform to build out commercially from there.

You're also developing a next-generation PK activator in [indiscernible] dysplastic syndrome. Can you remind us where this program stands and what the next catalysts are?

Do you want to start? .

Sure. So we have completed a Phase IIa in which we were able to a highlight that 40% of the patients reached transfusion independence with AG-946, which is that next PK activator that we are studying. And from there, we had a decision made that we would continue to move forward with a Phase IIb in which we would be exploring more doses. And so 1 of the lessons learned from Phase IIa is that we're bringing forward higher doses to IIb because we didn't reach maximum PD effect in the IIa. So we have guided towards getting that trial up and running by midyear. And so we are continuing to work on that.

And I think that's one of the key reasons why we identify ourselves as the worldwide leader in PK activation, for one, we pioneered the science. But two, it's a real advantage to have not 1 but 2 PK activators, which gives us therapeutic optionality. We also have a Phase I study that we're pursuing in sickle cell disease. So there, you can see we have franchise opportunity with AG-946, our other PK activator. And we also have very different opportunities therapeutically in the case of low-risk MDS. And that is a high unmet need arena with apparently very large potential. We've been tracking the growth that we've seen with [indiscernible] as they moved in their first-line position, and it's already well over $1.2 billion, $1.3 billion annualized sales on a reported basis. So that's a great opportunity. It's another place where PK activation can shine, and we may have potential beyond that as well.

And remind us of the features in which it's differentiated from PRYUKYND.

So it is a higher -- has a higher potency, so we need less milligrams to get to similar pharmacodynamic effects. And 1 of the differentiators between the 2 molecules was that mitapivat had some weak in vitro aromatase inhibition. This molecule does not. That being said, on mitapivat that has not translated into any clinical effects, but it is 1 of the differentiators

And then maybe commercially to state the obvious, it's not a pharmacologic difference, but an opportunistic difference is because we're in different therapeutic areas, it gives us pricing optionality. It's a different sort of the economic swimming lane, which again is strategically a real advantage for us for our portfolio.

And how are you thinking about positioning of this drug in the lower [indiscernible] dysplastic syndrome population, just in light of Bristol's drug that's on the market there as well.

I think the data will guide us, which is the most important point. But we were pursuing this with the potential similar to what we're seeing in or we've seen now in thalassemia, where the patient can have less dependence on the clinic in the form of transfusion reductions. And again, because it's an oral formulation, that's a whole different level of independence than with the incumbents that are currently in the treatment options for low-risk MDS.

Great. Just opening up to the audience for any questions. I'll keep going here. There, you spoke about the royalty pharma transaction. Help us understand now with the cash position you have, kind of the asset outlook that you have where you think this company will be in a year or 3 years? And how you think about kind of the catalyst path from here?

From a cash position?

Cash and just overall strategy .

Yes. Well, what's so exciting right now at Agios is that we have very advanced late-stage programs. We have multiple launch potential in front of us. We just talked about our other PK activator, AG-946, which we're also looking to advance and then we haven't even talked about earlier in the pipeline. We have other assets that we're developing. We have a PAH stabilizer known as AG-181, and we were really excited to announce the start of that clinical pursuit in Phase I in going after the PKU population. This is another area of high unmet need, very limited treatment options. And earlier than that, last year, we acquired an asset from Alnylam, which is an siRNA for polycythemia vera. It's a [indiscernible] inhibitor. And this is a massive population that essentially phlebotomy is the standard of care. So to answer your question, we're looking to advance our late stage, move into launch opportunities, make sure that commercially, we're successful with those launches. We want to make sure that we're progressing our other PK activator and then advancing our already internal earlier-stage assets. We have a lot of organic opportunities. Beyond that, as we build up our capabilities commercially as we grow our pipeline, as we build our leading presence in classical hematology, we're always going to have our foot on the gas in terms of looking for value-enhancing BD opportunities, but the beauty of Agios is we have so many great things going on right now. It's not like we're in a race or we have to do something immediately. And I think from an investor perspective, that should give confidence that we will always be seeking in a disciplined way, whatever is most value enhancing.

With that, thank you so much. Really appreciate you joining today.

Thanks, Salveen. Thanks, everybody. It's a very exciting time at Agios, and we really appreciate your attention.