Celcuity Inc. (CELC) Earnings Call Transcript & Summary

Hello, and welcome to Celcuity conference call. [Operator Instructions] I would now like to hand the conference over to Jodi Sievers, Head of Investor Relations and Corporate Communications. You may begin.

Thank you, operator. Good day, everyone, and thank you for joining us today to discuss FDA approval of gedatolisib. Today's press release, U.S. prescribing information and the slides we'll be reviewing today are available on our website, celcuity.com. Before we begin, I must point out that there, some of our comments today contain forward-looking statements that are subject to risks, uncertainties and assumptions. In particular, our expectations around gedatolisib are uncertain and subject to change. Should our expectations fail to materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements. A description of the risks, uncertainties and assumptions is included in our SEC filings. With that, I will turn the call over to Brian Sullivan, Co-Founder and Chief Executive Officer of Celcuity. Brian?

Thank you, Jodi. And joining me on today's call are Dr. Igor Gorbatchevsky, our Chief Medical Officer, who will provide an overview of REVTORPYK label and the supporting data for patients with HR+/HER2-, locally advanced or metastatic breast cancer. And Eldon Mayer, our Chief Commercial Officer, will provide an update on our commercial strategy and preparations for the REVTORPYK launch and then I'll wrap it up with some upcoming milestones. Let's please turn to Slide 4. All right. And now Slide 5. Well, let me start with the reason for the call. Today, we received notification from the FDA that gedatolisib or now REVTORPYK was granted full approval in the United States for the treatment of HR+/HER2- locally advanced or metastatic breast cancer without a PIK3CA mutation detected following progression on or after one or more lines of endocrine therapy in the metastatic setting. REVTORPYK is the first and only multi-target PI3K/AKT/ mTOR or PAM pathway inhibitor that has received FDA approval. And we believe that REVTORPYK has a best-in-class benefit-risk profile for patients and marks a significant step forward towards transforming treatment for patients with locally advanced metastatic breast cancer. This approval is a transformative milestone for Celcuity as we now transition to a fully integrated commercial-stage company, and we seek to advance REVTORPYK with additional indications in breast cancer and prostate cancer. Let's turn now to Slide 6. The PAM pathway is one of the most important targets in cancer, but comprehensively and safely inhibiting it has stymied researchers and drug developers for nearly 2 decades. REVTORPYK addressed this 20-year challenge by potently targeting all Class I isoforms of PI3K and mTORC1 and mTORC2 without inducing the unacceptable levels of toxicity that prevented other comprehensive inhibitors from advancing. The primary reason why PAM inhibitors have had limited impact despite the importance of the PAM pathway is because it is very difficult to safely and efficaciously inhibit this pathway. It has multiple components, each of which need to be inhibited to comprehensively blockade the PAM pathway's activity. Otherwise, the only single component is targeted, adaptive resistance arises and pathway shutdown is limited. Our published in vitro studies have found that geda or REVTORPYK is 300-fold more potent than the approved single target PAM inhibitors and the only one that is cytotoxic. The 2 positive Phase III readouts from VIKTORIA-1 in the second-line setting establish a strong foundation for us as we prepare for launch. In breast cancer alone, when we include the potential opportunity in the first-line setting, the total potential patient population we could treat over the long term is over 130,000 patients and the total addressable market potential is over $10 billion. I'd like to now turn the call over to Igor Gorbatchevsky, who will review the U.S. prescribing information and key clinical data supporting the approval. Let's please turn now to Slide 7.

Thank you, Brian. Hello, everyone. At Celcuity, we are very proud and grateful for this opportunity to deliver REVTORPYK to our patients. Our heartfelt thanks go out to all patients and their families and caregivers, investigators and their teams, FDA reviewers and the dedicated Celcuity team whose efforts made REVTORPYK approval possible. Let's turn to Slide 8. I will overview REVTORPYK prescribing information. REVTORPYK is approved in combination with fulvestrant with or without palbociclib for the treatment of adult patients with hormone-positive and HER2-negative locally advanced or metastatic breast cancer without PIK3CA mutation detected following progression on or after treatment with at least 1 line of endocrine therapy in a metastatic setting. The recommended dosage of REVTORPYK is 180 milligram as an intravenous infusion over 30-minute period once weekly on days 1, 8 and 15 of every 28-day cycles in combination with fulvestrant with or without palbociclib. Treatment continues until disease progression or unacceptable toxicity. There is no contraindications and the warning and precautions include some of the classes stated side effects. Let's turn to Slide 9. I will now summarize some key data from the REVTORPYK label related to efficacy of this treatment. The approval of REVTORPYK is based on positive clinical results from PIK3CA wild-type cohort of the Phase III VIKTORIA-1 trial, which is an open-label global randomized clinical trial evaluating the efficacy and safety of REVTORPYK plus fulvestrant with or without palbociclib for treatment of patients with locally advanced or metastatic hormone-positive, HER2-negative breast cancer following progression on or after CDK4/6 therapy and an aromatase inhibitor. In total, in this study, 392 patients were randomized equally 1:1:1 in 3 study arms. Two of the study arms were experimental, including REVTORPYK plus fulvestrant and palbociclib or REVTORPYK in combination with fulvestrant and the control arm included fulvestrant monotherapy. In the VIKTORIA-1 trial, the median progression-free survival with REVTORPYK triplet, it's REVTORPYK plus palbociclib and fulvestrant was 9.3 months versus 2 months for fulvestrant, an incremental improvement of 7.3 months or hazard ratio of 0.24 95% confidence interval 0.17 to 0.35 and p-value below 0.0001, representing a reduction in the risk of disease progression or death by 76% or quadrupling median progression-free survival compared to standard of care. The objective response rate of the REVTORPYK triplet regimen was 32% compared to 1% with fulvestrant and the median duration of response was 17.5 months. Slide 10, please. Now we will review results for REVTORPYK doublet regimens. For REVTORPYK doublet or REVTORPYK in combination with fulvestrant, the median progression-free survival was 7.4 months versus 2 months for fulvestrant. An incremental improvement of 5.4 months or hazard ratio of 0.33 and 95% confidence interval 0.24 to 0.48 and p-value below 0.0001, representing a reduction in the risk of progression or death by 67% versus fulvestrant or tripling median progression-free survival compared to standard of care. The objective response rate for REVTORPYK doublet was 28% and the median duration response was 12 months. The median duration of response for fulvestrant was not determinable because there was only one response. And now let's turn to Slide 11. Next slide. The safety data from the PIK3CA wild-type cohort of Phase III VIKTORIA-1 trial shows that REVTORPYK was generally well tolerated with most adverse reactions being of Grade 1 and 2. No dose reductions or treatment discontinuation of REVTORPYK occurred due to hyperglycemia. Stomatitis was generally manageable, occurred early and incidence of [indiscernible] including with severity with each treatment cycle. Serious adverse reactions occurring in more than 1% of patients, including pneumonia and thrombosis stomatitis -- and now I will turn over to Eldon Mayer, who will review the commercial strategy and launch plans for REVTORPYK.

Thank you, Igor. I'd like to review some highlights of our launch plans for REVTORPYK. And as I do, you'll see why we believe REVTORPYK is positioned for strong market adoption. Turn to Slide 13, please. We believe REVTORPYK is well positioned for strong market adoption in both PIK3CA wild-type and if approved, for mutant advanced breast cancer. To first address the market opportunity, within the U.S., approximately 37,000 patients with HR+/HER2- advanced breast cancer receive second-line treatment each year following progression on CDK4/6 inhibitors. Of these, roughly 60% are PIK3CA wild-type and 40% are PIK3CA mutant. And importantly, FDA approval of both indications would allow REVTORPYK to address 100% of this market with the simplicity of a single PIK3CA-agnostic treatment approach. This would be a major differentiator versus currently available therapies that are restricted to either mutant or wild-type patients. There remains a significant unmet need in this market for therapies that deliver better efficacy without compromising safety. REVTORPYK's unique mechanism of action as a potent pan-PI3K/mTOR inhibitor, combined with its pharmacokinetic profile and IV route of administration provides a distinct efficacy safety profile relative to existing oral agents. Taken together, we believe REVTORPYK will offer a compelling value proposition, best-in-class efficacy with a tolerable safety profile that positions it to become the new standard of care in this setting. We estimate a $6 billion-plus total served market opportunity across both wild-type and mutant populations, excluding potential first-line usage. Turn to Slide 14, please. Recent quantitative market research among breast cancer treating physicians has validated a clear medical need for new treatments in second-line PIK3CA wild-type advanced breast cancer. The chart here shows how physicians allocated their use of current treatment options. The sizes of the ARCs are scaled to depict the relative market share of each treatment choice. What's clear is that this market is fragmented. There is no go-to treatment option in this setting with each treatment option holding a minority market share among the various patient types. This sets the stage for a new treatment with strong benefit-risk ratio to potentially establish itself as a new standard of care. Turn to Slide 15, please. We are entering this launch with significant market and organizational momentum. First, we have built important relationships with key stakeholders in this market. We've engaged over 1,500 key opinion leaders and community breast cancer experts, over 200 key accounts, major oncology organizations, including GPOs, state societies and special interest groups as well as patient advocacy groups. Our unbranded marketing campaign at pampathway.com has already driven awareness of the PAM pathway, with metrics tracking well ahead of industry benchmarks. CME and third-party peer-to-peer programs and regional events have increased levels of education with the unmet need in HR+/HER2- advanced breast cancer. We have a robust launch plan in place that includes a comprehensive array of tactics and programs, including promotional materials, digital media campaign, speaker bureau and peer-to-peer promotional programs as well as an increased presence at national and regional oncology conferences. And importantly, we have a deeply experienced and trained teams that are already deployed and ready to deliver, including our sales force of 100 people, including sales management, teams for strategic accounts, payer and reimbursement, KOL-focused teams and importantly, our Medical Science Liaison team. This experienced customer-facing organization gives us immediate execution capability from day 1 of launch. Turn to Slide 16, please. Patient access to drug is a critical priority, and therefore, we have designed comprehensive support solutions to offer patients and providers rapid and seamless access to REVTORPYK. Prior to FDA approval, our market access field teams achieved 100% engagement with the top 36 strategic accounts and 100% engagement with top payer and provider pathways covering over 90% of U.S. medical benefit lives. We designed a tailored distribution model that is optimized for patient access to REVTORPYK. And our comprehensive patient support programs include digital patient enrollment, benefits investigation, prior authorization and appeal support, co-pay assistance and a patient assistance program. And in summary, these foundational health care provider and patient systems and programs are expected to support rapid uptake upon launch. Turn to Slide 17, please. Our launch priorities -- our launch priorities are clear: drive awareness, achieve rapid adoption and deliver patient access to REVTORPYK. Our sales force will cover approximately 9,000 health care providers that treat HR+/HER2- advanced breast cancer with a focus on the 2,000 providers that treat a high volume of breast cancer patients. Their priorities will be to differentiate REVTORPYK by highlighting its unique mechanism of action, strong efficacy and a tolerable adverse event profile as well as supporting patient access to drug with expected payer coverage and patient services. Our high-performing team of 88 oncology sales specialists has an average of 24 years of industry experience and a track record of 362 President's Club awards, which means that they were in the top 10% of sales performers in their prior companies during the relevant years. Turn to Slide 18, please. This approval truly marks the beginning of an exciting new chapter for patients with advanced breast cancer for health care providers and for Celcuity as well as laying a foundation for multiple potential indications in first- and second-line advanced breast cancer. Considering the U.S. market alone, we believe that second line, first-line endocrine treatment-sensitive and first-line endocrine treatment-resistant markets represent addressable patient populations of approximately 37,000, 59,000 and 33,000, respectively, which when combined, represent a potential U.S. market opportunity that exceeds $10 billion. Now Slide 14. And with that, I'll turn it back to Brian.

Thank you, Eldon. Well, we've made a lot of progress over the past year. And if we're not on Slide 20, let's please turn to Slide 20, over this past year. And we're looking forward to continued data generation, regulatory filings and news flow over the next 6 to 9 months, including several of these key milestones. Well, today, of course, we're announcing the approval of REVTORPYK. Next, in the third quarter, we'll be submitting a supplemental NDA to the U.S. FDA seeking approval for the treatment of HR+/HER2- patients that have PIK3CA mutations in the advanced breast cancer setting. Second and thirdly, we'll be submitting VIKTORIA-1 PIK3CA wild-type cohort data to NCCN this quarter. Later in the quarter, we anticipate commercially launching REVTORPYK. And based on the company's commitment to ensuring broad, affordable and unrestricted patient access to REVTORPYK, we've designed a comprehensive patient support program to make REVTORPYK available to patients prior to commercial launch program. And to make REVTORPYK available to patients prior to commercial launch, those who are eligible will be able to enroll in Celcuity's expanded access program. Additionally, Celcuity is qualified a second drug manufacturer and we'll be submitting a post-approval supplement to the recently approved NDA for FDA review. Throughout the rest of the year, we'll present additional data from our clinical programs, including an update to our Phase Ib metastatic castration-resistant prostate cancer study in the fourth quarter. And then we'll also be providing an update on VIKTORIA-1 PIK3CA wild-type and mutant cohort data in the fourth quarter as well. We currently anticipate submitting an MAA for both the wild-type and mutant data to the European Medicines Agency and similar filings with other regulatory authorities outside the U.S. following submission of the sNDA to the FDA. Let's now turn to Slide 21. And I think now is the time for questions.

[Operator Instructions] Our first question comes from the line of Maurice Raycroft with Jefferies.

Much congrats on the approval. Maybe starting, I'm wondering if you can comment on pricing and what that looks like relative to other agents targeting PIK3. And then I've got one other follow-up question.

Sure. So we'll be announcing or rather releasing the pricing to the various compendia that compile pricing from drug companies. And those compendia are used by the various constituents who will be either reimbursing or purchasing the drug to determine the pricing that they may ultimately access. And so until that process is completed, we won't be announcing a specific price, but that will be announced soon after those compendia are available to our constituents. The price will be a premium relative to what currently available therapies are.

Okay. Understood. And just comparing the safety profile in the label to what was previously reported in the wild-type study, there are some modest differences in some of the AE rates. Can you just help understand what's driving these variances? And is it a function of longer follow-up patient population or reporting methodology?

No, I'll answer that directly. We reported treatment-related adverse events, and those are events that the investigator, person treating the patient identified as related to specific therapy, whether it was gedatolisib or some other therapy. The FDA reports all adverse events and they're labeled treatment-emergent, whether or not they're related at all to or believed by the investigator to be related to the therapies that were prescribed. And so you will have the difference then would be in any of those numbers would be events that in the investigator's determination were not related to therapy. But the FDA takes a view that they report and want to report on the label every event that was reported, whether or not it was related to the therapy itself.

Our next question comes from the line of Tara Bancroft with TD Cowen.

This is Sam on for Tara Bancroft. Congratulations to the entire team for reaching this milestone. I just wanted to ask about the launch over the next year. How do you expect the initial sales ramp will evolve? And are there any key time points or gating items that we should be aware of after the launch in late Q3 that could lead to an inflection in uptake, for example, like a J-code activation or just the cadence of formulary reviews for practices?

Sure. No, thank you for the question. I'll give a little preview and then Eldon can fill in the blanks. Obviously, at launch, there's more friction than there will be over time. You mentioned J-code. At the outset, the company will launch with a temporary J-code. There are very specific time points when J-codes are assigned. Now accounts are very used to working with new drugs. And so our team, our market access team will be coordinating as well as our oncology sales specialists working with accounts to help facilitate that process for getting the drug reimbursed. One of the primary concerns that accounts have is the delay in getting reimbursed because this is a buy-and-bill drug. And so we've put in place a program that we'll be offering accounts extended dating so that they won't affect -- in effect, be cash flow negative when they prescribe this therapy. And that, in the experience of our team really significantly addresses the potential barrier that a temporary J-code can create for the accounts. Eldon, I don't know if you have any color to add to that.

No, Brian. I don't think I have anything significant to add to that.

Our next question comes from the line of Brad Canino with Guggenheim.

I will add my congratulations as well. I want to ask about the treatment duration. This has come up in conversation with investors quite a bit. I know in the JCO and even this label, it reflects a median duration of exposure of about 6 months. When you do your TAM estimates, you're using 10 months treatment assumptions. So can you help us understand like this median metric? Is that the right thing to think about in terms of an average treatment duration you would expect when you get into these real-world patients?

No, that's a good question. And so the treatment duration is hampered by -- or not hampered, but is significantly affected by the relatively short follow-up period. And so you essentially understate what is the actual experience that we expect patients to be on. We estimate that patients based on their persistence on the therapy, which is really the best way to look at that or calculate that is looking at the average duration of patients. And that is obviously the number that would get plugged in any formula estimating drug usage. And so the 10 months that we allude to on the presentation reflects essentially 9, the average between 9 and 11 that we reported for the triplet with the PIK3CA wild-type and mutant therapies. But our persistence analysis with the data that we have suggests that PFS is a very good representation of the likely drug duration that patients on average will experience when they're on treatment with geda.

Our next question comes from the line of Silvan Tuerkcan with Citizens.

Congrats on this major milestone here. I think I have a quick question on; you mentioned that this drug will be buy-and-bill. Is there any portion that will be through specialty pharma and bill directly to patients? Or is it 100% buy?

Eldon, why don't you answer that? I know it's a buy and bill. None of the drug will be prescribed to patients directly. It's not -- obviously, it's an infused therapy that requires administration in a facility. But there might be some take-up by specialty pharma. Eldon, could you maybe address that question?

Yes. That's correct. So we have contracted with a specialty pharmacy that will be able to distribute and handle benefits investigation and other services that they offer for specific doctors' offices practices that are typically smaller and do not want to take on the burden of purchasing the drug and waiting for reimbursement. So at times, they will do what's called white bagging where they will have the drug shipped to the patient and the patient will bring it in. And we expect this is normal, and we expect this to be a very small portion of our business, probably low to mid-single digits at most on a percentage basis. So we're prepared for this, and we will offer this, but we don't expect it to be a significant portion of our business.

Our next question comes from the line of Eva Fortea with Wells Fargo.