Amgen Inc. (AMGN) Earnings Call Transcript & Summary

So good morning, everybody, and thank you, once again, for joining us at the 4th Annual Oncology Innovation Summit. I'm Yaron Werber, one of the biotech analysts here at TD Cowen, and it's a great pleasure to moderate the next session with Amgen. With us today is David Reese, EVP of R&D; and Arvind Sood, Vice President of Investor Relations. Gentlemen, thank you so much for joining us. It's good to see you.

Thanks, Yaron. Great to be here.

So for the audience, if you have any questions, feel free to e-mail them directly to me, yaron.werber@cowen.com. Or also there is a Wall Street webcasting link, and you can put the questions directly into the box. And I could see them and happy to ask them for you.

So David, lots to talk about in terms of the oncology pipeline at Amgen. Let's start actually with BLINCYTO, which is something people are not focusing in on too much. The drug has been growing really well. It was one of the actually impressive late breakers at ASH, with BLINCYTO looking at sort of long-term data and outcomes. Can you talk a little bit about that data set and sort of what's the future for the brand?

Sure. Maybe I'll just start by stepping back for a second, and I can note how that fits into our broader oncology strategy. And several years ago, I think we were among the early ones to realize that modern oncology would be driven by this marriage of precision oncology and then, of course, immunotherapy. Within precision oncology, we focused on high-value novel targets, LUMAKRAS, Bemarituzumab, which I think we'll get to examples there. And then in immunotherapy, of course, the bispecific platform, not only BLINCYTO now, but tarlatimab AMG 509, and others coming along. And hopefully, we can talk about that as well. With regards to BLINCYTO itself, this is a molecule that I really, really like. I think it's simply transforming the treatment of ALL. The data that you referenced at ASH were conducted by the ECOG-ACRIN Cooperative Group, incorporating BLINCYTO into the standard chemotherapy regimen in adults with first-line ALL with MRD-negative disease, and this showed a substantial improvement in overall survival. More recently, you may have seen a paper in the New England Journal of Medicine just a few weeks ago with -- published by another group of investigators who have a long experience treating infants with ALL. This, again, incorporated BLINCYTO in first line and showed, compared to their extensive historical data, a substantial improvement in overall survival. We've got other studies ongoing in the first line as well. And my full expectation is that this drug will be a widely incorporated in first-line therapy in the coming years, I think it's really going to improve cure rates almost without a doubt.

Terrific. And David, when you think about some of the learnings from that initial sort of by technology, the original technology that you acquired versus your latest acquisition that's taken you into a slightly different direction with bispecifics, what are you now able to do given the latest acquisitions that you weren't able to do originally with the original acquisition?

And you may be referring to the TeneoBio acquisition within the last few years, which has a different CD3 binding mode in the properties, the kinetics are a little different. We now have modular components that actually allow us to design molecules. They're all half-life extended, but both on the target side and on the CD3 binding side. One of the things that I like to emphasize over and over in this field is that a lot of the lessons are not generic. Meaning, what you observe in one tumor can't necessarily be extrapolated to another tumor because so much depends on the target. Tarlatimab, which I think we'll get to in a moment, is a nice example of that, where you see very, very low rates of Grade 3 CRS, on the order of a few percent. I think that is very much target-dependent.

Okay. Is it also solid tumor versus hematological tumor-driven?

I don't think there's any question about that. And in the tarlatamab data in small cell lung cancer, if the ongoing potentially registrational Phase II trial, which I'll talk about momentarily, is positive to me. That's a huge moment in the field because that is the first demonstration in a major solid tumor that the bispecific platform has a utility. Based on everything we've seen so far, I'm very, very keen on that molecule as well as the STEAP 1 targeting molecule in advanced prostate cancer.

Okay. So let's talk about tarlatamab. And then specifically, you're talking about the Phase II pivotal DeLLphi-301 study in small cell lung cancer. The data is expected second half of this year. As you noted, the neurological AEs were less than 10%. There was a 23% response rate at the relevant doses from the Phase I data. This was at the World Lung Meeting last August, about a 13 months median DOR. So when you're thinking for -- from an approvability standpoint, this is a single-arm Phase II pivotal study. What do you think you need to show on ORR? And sort of what's the benchmark for you on median DOR? And sort of what historical control suggest chemo can do in that second plus lines?

Yes. If we step back here, small cell lung cancer is a disease where the same drugs are used that were used when I was a fellow in oncology training 30 years ago. Not much has evolved in the field. In the second- and third-line settings, meaning an overall survival ranges between 5 and 8 months. It's a very, very aggressive disease, typically when it's recurrent. As you noted, in the Phase I data, roughly 1/4 of patients had responses. But what really made me sit up here was the duration of response over a year, which is almost unheard of in patients, in this instance, often with third and fourth-line disease. And the median overall survival was also on the order of 13 months. I think if we can replicate those sorts of durability and survival data in the Phase II, that's a pretty compelling data package in terms of the utility of the agent. And again, the tolerability was quite good. Grade 3 CRS, very rare. The neurologic events, what you noted have occurred. But it's worth pointing out that most of those were actually altered taste, which was transient and was really not clinically all that significant. So I've been quite pleased with the tolerability profile that we've seen so far as well. So bottom line, I think if we can replicate data on the order of what we saw in the Phase I trial in this larger Phase II setting, I'd be quite pleased with that.

And then separately, you're enrolling now the Phase III head-to-head against chemo in second line. What are you expecting chemo to do in that study? We've seen a creep of data getting better with docetaxel in second-line non-small cell lung cancer. If we've seen a creep up as well with Topoisomerase Inhibitors in second-line small cell lung cancer or it's been fairly stable?

If there's been a creep, it's been very minor. And I think that the bar there is pretty well established with chemotherapy in terms of response rates. But again, here, the challenge is durability. Even in those who respond, the duration of response is often on the order of weeks or a few months, which is the real challenge here. So if we can extend that duration of response, that's what actually might then translate through to a survival benefit.

And so is it powered -- it's powered for PFS and durability and the secondary endpoint is response rate or -- how did you think about kind of...

Yes, yes, yes, exactly. But I think overall survival will be also important to look at in this disease, given that overall survivals are so short in the -- once you get beyond the first-line setting.

Okay. Terrific. So let's go and talk about one of the drugs that's actually in Phase III and is not discussed much is bemarituzumab that you got from the Five Prime acquisition. You're currently enrolling the Phase III FORTITUDE-101 study. This is bema with chemo in first-line gastric and gastroesophageal junction cancers with FGFR2b positive tumors. What are you expecting from that study? And can you put it in context relevant to the current standard of care in that setting -- in that first-line setting?

Yes. So the bemarituzumab program, as you noted, it targets the FGFR2b receptor, which is overexpressed in about 30% of all gastric cancers. Epidemiologically, gastric cancer is one of the most important tumors in the world. It's the third or fourth leading cause of cancer mortality globally. In certain areas, it's much higher and more prevalent, East Asia, of course, classically where gastric cancer is quite prevalent. Again, standard of care here, with the exception of the recent approvals of the checkpoint inhibitors, also had not changed for many decades. The current Phase III program is designed to accommodate different standards of care that exist in different areas in the world. As you noted, one trial is chemotherapy with or without bemarituzumab. That's essentially a replica of the FIGHT study. The FIGHT study was the Phase IIb study that showed improvements across basically all of the endpoints, response rates, progression-free survival and overall survival in patients with FGFR2b overexpressing gastric cancer. And then the second trial is built on a chemotherapy checkpoint inhibitor backbone with or without bemarituzumab, again, designed to accommodate the change in standard of care in some regions to incorporate checkpoint inhibitors in many patients, certainly those who have PD-L1 expressing tumors.

And David, the checkpoint of choice in that study, is that NIVO?

NIVO is the drug that's been studied most frequently here.

Okay. And so that's considered pivotal. That's the FORTITUDE-102?

Yes. It's intended that both of those will ultimately be pivotal trials.

Okay. And so as you think about sort of the powering of the study and what you're expecting to see, are you expecting to see an equal effect with chemo without PD-1 and on top of the PD-1 chemo backbone? Or do you think that, inevitably, once patients get chemo and NIVO, the benefits probably just going to have a little bit more from [indiscernible]?

I don't know that I want to speculate on that. There, we'll look at the data. But based on everything that we from preclinical modeling and what we can expect in the clinic, the sort of relative increment, we would hope that we would see something roughly on the same order.

And you're also running a basket study. And then separately, this is bema mono. And then separately, there's also a squamous non-small cell study as well. It's a Phase Ib. When you're thinking, we know that there's hyper-expression in non-small cell, what other tumors sort of come to mind next?

Yes. So as you mentioned, squamous non-small cell lung cancer, again, on the order of perhaps 20 to even 30%, we'll overexpress the FGFR2b receptor. So we're doing a Ib study that could progress to later-stage trials should that look good. And then a basket study. There's a sort of a large grab bag of tumors where a fraction of them, a lower prevalence will overexpress FGFR2b, things like head and neck, squamous carcinoma, endometrial cancer, triple-negative breast cancer, cervical carcinoma and others, where we're actually just looking for a signal with monotherapy and then we would build on that, should we see some evidence of activity in those FGFR2b expressing tumors.

And in squamous non-small cell, is that potentially a monotherapy pathway? Or is that mano plus chemo?

It is more likely chemotherapy combination.

Okay. Got it. Okay. Let's move next and talk about LUMAKRAS. There's going to be data coming up at ASCO looking at LUMAKRAS with [ Carboplatin ] that showed an 89% response rate in second line. That response rate, I think, is fairly unprecedented, right? We're not used to seeing those kind of response rates in second line. Anything specific that we need to kind of keep in mind in that initial data set? Again, it wasn't a huge data set, but look fairly compelling. That we should just kind of keep in mind whether patient population that might not be quite translatable as you go into a broader sense?

Yes. I mean these are data, investigator-sponsored so-called Scarlet study, that really caught our attention. And that's what is leading us in patients with PD-L1 negative tumors, which are 1/4 to 1/3 of all non-small cell lung cancers to explore a Phase III trial with chemotherapy with or without LUMAKRAS. That is -- or excuse me, chemotherapy, LUMAKRAS with the checkpoint inhibitor control arm. But that trial is a trial where if we can come anywhere close to the sort of data that we've seen so far, that would really show some sort of synergy between chemotherapy and KRAS G12C inhibition. Of course, there's a lot of laboratory evidence suggesting that you may get synergistic tumor cell killing with those sorts of combinations. But that really formed the basis for what will be a Phase III trial launching later this year.