Arvinas, Inc. (ARVN) Earnings Call Transcript & Summary

Okay. We'll continue with the next session. I'm Paul Choi, and I cover those mid cap biotech sector here at the firm. It's my pleasure to welcome Arvinas for our next session here. Joining us to my immediate left is John Houston, CEO; and Noah Berkowitz at the far end there. What we'll do is maybe let John give a little bit of a brief introductory remarks, and then we'll go into Q&A, if that's okay.

That's great, Paul. Thanks. It's great to be here. Certainly, Arvinas is at a very kind of critical exciting stage in its evolution. We have pivotal Phase III data coming out at the end of this year with our second-line monotherapy study with vepdegestrant in metastatic breast cancer. That really sets us up incredibly well for what we see as potentially 3 launches, if everything goes well over the next 5 to 6 years. The monotherapy launch, then we're going to be starting another second-line study in Phase III in combination with another CDK4/6. And then starting up our first line study, either with palbociclib or atirmociclib. So setting up a potential 3 launch sequence, '25 through to 2030 in an area where there's still significant unmet needs and a huge potential opportunity overall. So very excited about the planning around vepdegestrant and we've been to the details of the plans we have with our partner, Pfizer. And on top of that, we have a very exciting pipeline behind that. We have our first heme program, BCL6, that will be in the clinic shortly. And maybe even more excitingly, our first neurodegeneration program, this in healthy human volunteers. That's a program focused in degrading LRRK2 aimed at progressive supranuclear palsy and also Parkinson's disease. So the first of what we think will be several neuroscience programs coming from our portfolio. So it's a great position for the company to be in. A lot of data flow coming up over the next year or so plus initiations and data. So very exciting.

Okay. Great. Thank you, John. Maybe to take it back a step before we get into the weeds with the various programs. For investors who may be new to the story or unfamiliar with the space, can you maybe briefly explain to us what is your PROTAC platform? And how does it address some of the challenges in unmet needs in terms of protein degradation?

Absolutely. So the company was founded in 2013 on the back of some great pioneering work by Professor Craig Crews at Yale University. He was focused on ways of hijacking the cell's natural protein degradation mechanism, the proteasome-ubiquitin system. What you wanted to be able to do, and subsequently, with Arvinas being founded, we did it, was be able to design heterobifunctional molecules. Basically, a molecule is a ligand that binds to a target -- specific target you want to degrade but the end of the molecule recruits an E3 ligase from that cells natural ubiquitin system and there's a linker in the middle. So it's a bit of a kind of a dumbbell molecule. But the molecule brings these 2 proteins into close proximity, the ligase and the target. And when they get to close proximity, ubiquitin is transferred to the target protein. And once you get 4 ubiquitons, that serves as the signal to send the protein off to the proteasome, which is basically the garbage disposal unit in cell where the protein is basically shredded down into peptides. So very effective, and the exciting thing is these molecules of PROTAC as Craig designed them are released after that first round. And so you get repetitive rounds of degradation, driving a kind of pharmacology that's very unique that you don't see with inhibitors. So this is not occupancy driven. It's not sitting on the receptor. It's binding to the target, bringing it into close proximity to this proteasome machinery, then the protein gets degraded. So it's a very unique pharmacology, allows us to get rid of the target that's causing disease and keep it down with the repetitive nature of the iterative process.

Sure. You've kind of led into my next question, which is you've kind of basically explained about what is sort of the rationale behind vepdegestrant here, particularly given that it is involved with -- obviously, with a hormonal receptor.

Yes. So the only intracellular targets we can tackle are ones that are available to us to drag off to the proteasome. So nuclear receptors, any -- even membrane bones targets if they have an intracellular tail. So it's a whole array of different targets. And certainly, over the history of the company, probably about 95% of the targets we've approached to see if we could degrade them, we've been able to degrade.

Okay. Great. Maybe sticking with vepdegestrant. You recently presented updated Phase I data for vepdegestrant in combination with Pfizer's palbociclib at the recent ESMO breast cancer meeting in Berlin. Can you maybe summarize the data for us and just provide some context on how these data compare to historical data in later-line breast cancer?

I'll start and then I'll hand over to Noah. Clearly, we're very excited about the data. This is a trial in patients that had progressed previously on a CDK4/6 and were given palbociclib plus vepdegestrant. So the expectations were potentially low in terms of how those patients would do in the trial. But remarkably, we saw 11.1-month PFS in the trial. I think those up-to-date information to get up to 15.6, but truly remarkable data in a patient population that has been previously progressing. Noah, anything you would add?

Yes, I would just say that we had reported earlier. We had reported these results the first time at the San Antonio Breast Conference in December. The -- with additional follow-up, we were able to see more maturity of the data. So a continued expansion of benefit for patients. And we also added some updated PD data or a new measure of efficacy and we looked at ctDNA in patients, and we're able to show that there was a rapid degradation or destruction of these tumors in patients which just, I think, goes towards this mechanism of action and the promise about combining with palbo.

Okay. And maybe how do these data stand relative to historical studies and sort of the post CDK4/6 population here?

Sure. So I think what was exciting for everyone was that this is the first time that anyone has been able to demonstrate a double-digit median PFS in this type of setting. As recently as last week, there was a study called postMONARCH that read out and this is a study in which abemaciclib and fulvestrant where compared to fulvestrant alone in patients who were second line. And one of the observations in this study, and this is patients who would mostly receive palbociclib in first line, and now they're being switched to abemaciclib, another CDK4/6 inhibitor and fulvestrant, a SERD, Selective Estrogen Receptor Degrader, is being added to that drug. And patients on that combination were able to show a 7-month -- I'm sorry, a 6-month median PFS. Now in our hands, in much later line because that was a second-line study I just described. But in the palbo combination that we reported out at ESMO breast, we're talking about patients that had more than 3 prior lines of therapy, and there the median PFS was 11 to 13 months. So I think it stands out. It was a smaller data set, but it involved 46 patients. So I think that,, that will be a stable end point for us as we plan our next second line combination studies.

That's great. One of the things I think investors' focus on is how the combination performs both in wild-type patients versus ESR1-mutant patients. And so can you maybe tell us either John or Noah, what learnings did you glean in terms of planning studies for those particular populations in the second line plus setting here?

Sure. So we -- now there have been few studies that have reported out the difference between wild-type patients and ESR1-mutant patients. So I'll highlight one, and that was elacestrant in which they looked at elacestrant monotherapy versus fulvestrant. This study reported out a few years ago, and it led to an approval, but only in the ESR1 mutant population. When one analyzes the data and the interaction with the health authority, what we see is that there were better results in the mutant -- ESR1 mutant population than in the nonmutant population. There was similar toxicity in both groups. So in the end, the challenge for the health authority was we see benefit in the ESR1 mutant. We have unclear benefit in the -- although trending but unclear in the nonmutant population, but there's toxicity and therefore, the benefit risk overall can be deemed favorable in the ESR1 mutant population, but we're not going to give it to you in the nonmutant population. I think that we have the same challenges moving ahead when we report out in our VERITAC-2 study. We will hopefully show that we have benefit in both populations but with a more pristine safety profile, which has been supported by all of the Phase I work we did, then we can expect to make a better argument for benefit risk even in the wild-type or the non-mutant type population. So there's an upside of a broader label, though our base case really is the ESR1 mutant population.

Okay. Great. Can you maybe also help us think about how your recently updated Phase I results that you presented at ESMO breast might be potentially predictive of your VERITAC-3 combination study, which you're planning for in terms of the frontline setting and just maybe in how do we translate your existing data to a frontline setting?

So I'll take the -- so our recently reported results, as I said, were patients that had more than 3 lines of prior therapy in the metastatic setting. And yet they -- we posted more than 11 months median PFS there. It is kind of an accepted rule of thumb in breast cancer drug development that the earlier -- in earlier lines, patients will do better than later lines. And the more prior therapy, the less benefit any novel therapy can offer. So having shown in late line that we can achieve 11 months of median PFS, we're expecting to do much better in first line. So we have the conviction already to go there. We're planning a Phase III study in first line. We're now trying to determine what's the best dose of palbo to use in combination with our drug in first line, and that's the nature of a safety run-in that's going on. As we accumulate that data, we can make a decision in 2025. Does our first-line study involves palbo, right, with a new selected dose that would be even better than the one that we used in the study we've been talking about from ESMO or do we want to pivot to put ourselves on the shoulders of Atirmociclib, our partners promising CDK4 inhibitor that they will be developing in first line. So that's the decision that will be data driven, and we will make at the end of the year, we'll drive a study sometime next year in first line.

Okay. Great. Maybe turning back to what you brought up just for a moment in terms of palbociclib dose expansion. Can you maybe just remind us sort of what are some of the challenges involved here with the combination of the 2 drugs here? Obviously, you have palbociclib inhibition and things like that and just kind of what you've seen so far in terms of dose exposure and sort of what the changes are just due to palbociclib inhibition and other factors?

Sure. So palbociclib is -- was for years, the most successful CDK4/6 drug. It was the first one approved in the first-line setting for metastatic breast cancer, widely used as standard of care, even as some other companies posted slightly better numbers in the first line. Now the challenge for palbociclib, while easier to dose than its competitors, abemaciclib and ribociclib, right? Because abema has a lot of GI toxicity associated with it and ribo has some EKG related liabilities. But palbociclib is known to have a narrow therapeutic index and causes some neutropenia. When we dosed our vepdegestrant with palbociclib, the palbociclib exposure went up a little bit, some tens of percent more than what is typically seen. And as a consequence, we dialed up neutropenia and we didn't dial up additional efficacy. Pfizer had already demonstrated that more palbo exposure doesn't drive more efficacy, but it can drive more neutropenia. So we decided that it would be safer to use a slightly lower dose of palbo, dial out that neutropenia, get back down to a lower level of neutropenia and still be on that really promising part of the efficacy response dose. So we're running that study now and expect results at the end of the year that can drive that decision.

Okay. Maybe turning to your most advanced program, which is VERITAC-2, your ongoing monotherapy study, you've indicated that you'll top line data relatively soon in the second half of this year. So as the company's sort of next major clinical catalyst, how would you level set with investors sort of, what you'll disclose with the top line results here and just how should investors think about potentially benchmarking this upcoming top line data against comparators such as, let's say, LSS strength, which you referenced earlier?

I'll take an initial shot, John may want to follow up. So we have a study that's looking at patients that are in the second plus line of therapy. So we've designed one that will show an improvement in median PFS and have an event-driven trial that's looking at the hazard ratio. We could expect that -- we're expecting that will be superior to our fulvestrant monotherapy and we'll post a few more months of median PFS. It's difficult to do cross-trial comparisons. So I don't want to -- our trial isn't exactly the same as elacestrant's registrational study. So I wouldn't want to draw the direct comparison. And I think in the end, we will have a positive study, but what I expect is we'll also have a drug that has a really pristine safety profile. And certainly, that combination of promising efficacy that may end up certainly being better than what elacestrant showed. [Audio Gap] I think makes for a good marketing opportunity. [Audio Gap]

[ Definitely ] , I mean, I think the data hopefully will clearly provide enough information for us to say that vepdegestrant trying to replace fulvestrant as the standard of care in that setting. It's going to be an oral drug, intramuscular. They'll have the safety profile, we think they'll be excellent and efficacy to be, I think, very good. So we're looking forward to the data set. I think it will position that at its beginning here of potentially 3 different indications over the next few years in a really strong way.

Okay. Great. So assuming positive data here, as Noah has laid out here, can you maybe walk us through what would be next steps in terms of both presenting detailed data from VERITAC-2 here potentially and medical meeting, maybe I don't know if San Antonio 2024, makes sense here and then next regulatory steps?

Well, it gives us pivotal data, and we want to get that data out for dialoguing with Pfizer. We're not sure whether it will be at a scientific conference or we'll do a broadcast, if you will, from the company. But clearly, the focus is to get the data in to make sure that we have all the relevant information and make sure that data comes out and is discussed. If it times with a scientific conference, all to the good, but we want to make sure first that we've got all the data. So yes.

Great. And then in terms of planning for regulatory steps, just what the cadence might be there?

Yes. We've launched our -- like any company would, we've launched our submission planning with our partner, which is going well. So the cadence would be some type of submission within a few months of the top line results. And then we have breakthrough designation for it, so one can calculate the time that it would require in the U.S. But we are looking forward to a global submission. We happen to offer guidance of exactly how many months behind other filings around the world would be.

Okay. And just remind us, would you be you or Pfizer be handling the other NDA filing here?

We handle it in the U.S. with a lot of support from Pfizer because it's a pivotal -- because they're running the pivotal study, but we will run that in the U.S. But I view it as a partnership.

Yes, absolutely. And of course, we will be the U.S. leads as well when the other drug will be launched.

Okay. Great. I want to talk maybe a little bit about the competitive landscape as well, too. And at the recent ESMO breast meeting, we also saw some early data from Olema. While the data set was fairly small and limited, I guess, and maybe somewhat challenging to interpret, what are your impressions of that drug in the clinic so far?

It's behind vepdegestrant. That's the first thing. I think the profile overall is not as good as vepdegestrant. So I think it has a lot more to prove over the coming year or so. When we look at the competition, we look at the ones that are ahead of us, like elacestrant and the [indiscernible] compound and look at how well we could do against those. But you're right, it's a very competitive space, where we believe the profile of vepdegestrant in terms of efficacy and safety is going to be paramount. So I think it's going to be the winning profile compared to all the other compounds out there that are SERDS or versions of SERDS. And again, the prototype mechanism is uniquely different from all of those mechanisms. So I don't think -- no.

You haven't heard anything?

I think that's it.

Yes. Okay. Great. Also, last week, on the heels of ASCO, some investor questions may have come up, at least as reflected by your recent share price report. So it's been somewhat volatile with regard to your partnership with Pfizer and the outlook for the vepdegestrant program. I guess maybe what would you want to say here on the status of your partnership with Pfizer and the VERITAC clinical development program broadly.

I mean, again, I shouldn't be surprised but I was surprised. We thought the ASCO's meeting, although we weren't presenting much the data from postMONARCH was -- that data wasn't too hot, too cold, but it was just right in terms of the profile that we think would be encouraging for us to go forward with our plan, [indiscernible] and also position I think endocrine therapy is what you do first before you go on to that therapy. So actually, could not ask for feeling very good. And then we have this rumor going around that Pfizer again had at a dinner and some thoughts were that maybe they were changing their views about vepdegestrant. Nothing could be further from the truth. They are completely aligned with the game plan. Nothing has changed. In fact, they constantly talk to us about other things that could be added and they're very excited about the KAT6 data. As you know, we have an ongoing umbrella study where we have the opportunity to slow in different mechanisms. We already have combinations ongoing with abemaciclib, ribociclib, the CDK7 from Carrick, CDK4 was in there initially and we took that out to kind of boost it even further. So there's other 3 mechanisms that could be put into that umbrella study in KAT6, it could be one off. I don't know what was actually said at the dinner. Then I talked to Chris Boshoff a couple of nights later, and he's completely aligned with the game plan that we have. And we -- I would say that, that partnership is going from strength to strength.

Okay. Great. You brought up something interesting, which I want to touch on briefly as well, which is KAT6 and HR-positive HER2-negative data which is, I think, emerged as a target of interest in the wake of the ASCO meeting. So I guess maybe what are your preliminary thoughts on the data we've seen so far from that particular target and the various companies pursuing that. I don't know. Noah or John, if you want to tackle that?

Yes, I would just say that these are some results that we had seen earlier. This is a more mature representation of it. But I think, convincingly shows that KAT6 is a worthy target for development in combination with endocrine therapy. We believe that we have the best degrader, the best -- the only PROTAC around. Pfizer is saying this is the future of endocrine therapy in their shop. We have a great partnership. So maybe KAT6 becomes -- we move towards combining that with vepdegestrant, and this is something we have to evaluate.

Okay. Great. Maybe just to round up the vepdegestrant discussion here. John, you briefly touched on [ you doing ] program with other agents, including other CDK4/6s, whether it's abema or ribociclib as well as Pfizer's CDK4 and just kind of maybe you can lay out for us where and when we might potentially start to see some of this additional combination data.

Yes. And the plan is we'll have some of the umbrella data towards the end of this year at a scientific conference. And they're all going to run at slightly different paces. So we'll have what information we have at that time, we'll be able to talk to. So we certainly have abema data and some ribo data, whether we have CDK7 data, we don't know yet. But that will give us the profile of how well the compound is doing in combinations. They're largely safety studies to look at how well they combine. But yes, at the end of the year, we'll have that. And as that data matures over the following year, we'll have even more comprehensive data.

Okay. Great. I want to turn to maybe other areas of the pipeline, including hematology, which I think maybe gets a little bit lost in the shadow of vepdegestrant and you're focusing on BCL6 and maybe -- can you maybe just remind us where and which liquid tumor types or heme types, it's most prevalent. I think people are obviously familiar with BCL inhibitors due to venetoclax and so forth. But sort of -- what is the opportunity set here potentially? Is it primarily CLL or other indications as well?

One great thing about having a new CMO is his expertise in heme. So Noah?

We're excited about the BCL6 and are very enthusiastic about the Phase I study we opened recently. The overall BCL6 is important in the maturation of B cells within germinal centers, but it looks like in the presence of disarray in terms of that function. You get maybe a driver effect for diffuse large B-cell lymphoma and to a smaller extent, just some cases of follicular lymphoma. We know that the highest-risk patients with large B-cell lymphoma are the patients that have double or triple hits, those hits being in MYC and BCL2 or BCL6. So BCL6 seems to be important in those diseases. No one's been able to really target it effectively in the past. We feel that we're in a leadership position in this space, having just opened a study. And we're going to look at it in all comers of B-cell lymphomas as we do our dose escalation and we'll accumulate data about does it -- is it more effective in patients that have BCL6 mutations or translocations. So more to come. I think it's early in the course of that. But we know that we have a drug that's attractive from all the PDX models that we've run and also has a pretty clean safety profile from our GLP enabling studies or IND-enabling studies. So it will take another a little less than a year, I think till I could share data with you, but we're quite enthusiastic.

Right. I mean I think the opportunity is set to avoid some of the issues seen with like BCL -- drug like venetoclax would be quite interesting, right, in terms of improving on the profile. And so that's certainly interesting. Great. So some data potentially next year. Yes. And then as former neuroscientist, I'm always super interested in things that are working in the Parkinson's space. And so you also have a neuroscience program here and focusing on LRRK2. And so maybe can you again remind us what's sort of the logic of going after that here in neuro? And just sort of what next steps are for that program?

Sure. So LRRK2 is a protein or makes a protein that has been implicated in Parkinson's disease. So we know genetically patients that have LRRK2 mutations have a -- there's a familial sort of Parkinson's disease. And it's also been able to -- we've been able to show others have shown that there is a biological pathway that may be -- that may drive tauopathies where LRRK2 is an important driver. We've applied our degrader technology, which is distinctive because it allows us to degrade LRRK2, a complicated protein, that has kinase activity, GTPase activity and scaffolding function, all of which contribute to some lysosomal activity and other trafficking activity in neurons. So we've been able to now demonstrate that we can degrade. We know in our [indiscernible] studies that we've been able to degrade with this oral drug in deep portions of the brain. We can see the degradation of LRRK2 in CSF. And now we've embarked on healthy human volunteer studies in Europe to dose these patients and look at LRRK2 degradation in the periphery and also look at degradation in CSF. And on top of that, look for downstream markers of the effectiveness of that degradation. There's some validation of choice of LRRK2 as a target with some other competitors in the space. So Biogen and Denali are working on LRRK2, they're expecting to read out a Phase III study, I think, in early 2026. They have -- while they're very effective at inhibiting the kinase activity of LRRK2, they've been unable to demonstrate in CSF downstream markers of activity for their drug. We're hopeful that we can differentiate with the healthy human volunteer study and then eventually studies in Parkinson's disease that will follow shortly thereafter.

That's great. What other areas might this potentially be applicable in terms of a neuro setting? Obviously, Parkinson's makes a lot of sense here, but just sort of talk a little bit about tauopathies and so what else...

So I think that the first issue that I think, where the first curtain that gets -- the first reveal here is can we use an oral drug, an oral degrader that is able to get into deep portions of the brain and degrade there, right? So that is a challenge. We feel that we have derisked that a lot already from our nonhuman primate study, but we have to demonstrate it in human beings. But if that's true, then we know that our underlying technology would allow oral drugs to be given to degrade other products like tau, like alpha-synuclein, other important targets in tauopathies, in Parkinson's disease, in Alzheimer's, et cetera. So I think that just being able to complete this degradation with an oral drug in our first studies here opens the door for future studies with other targeting protects. I don't know, John, if there was ...

Absolutely, right. We're very excited about this stage, the neuro portfolio is that. And it's really going to be significant to see the LRRK2 data because as Noah said, if we can show the data we saw in monkeys in humans, then it really opens up the rest of that portfolio, including targets like Huntington, in which our ability to get highly selective degraders is going to be really important. That's a whole new opportunity in a massive area of huge unmet needs. And so yes, I think this is an area where PROTAC actually can have a big impact.

Okay. Great. We're coming up on time. So I think we'll have to end it on that note. My thanks to John and Noah for joining us today. Thank you.

Okay. Thanks.

Thank you.