Curis, Inc. (CRIS) Earnings Call Transcript & Summary

Thanks for joining us for the Curis business update covering the second quarter of 2023. To start, please visit the Investors area of our site, www.curis.com, where you'll find our release on second quarter 2023 business results along with the accompanying financial tables. Also, a reminder that forward-looking statements will be part of this call, and those rest on what we currently expect and believe. Such statements carry certain risks and uncertainties, and actual results could differ materially; for more information, please review our SEC filings. With me today are Jim Dentzer, our President and Chief Executive Officer, and Jonathan Zung, our Chief Development Officer; a question-and-answer period will also take place at the end of this call. I'll hand things over now to Jim.

Thanks, Diantha. Hello, everybody, and thanks for joining Curis’ Q2 business update call this afternoon. The major development this quarter is definitely the lifting of the partial clinical hold on our TakeAim Leukemia study, which we achieved a full quarter ahead of schedule; that reflects both the dedication of our Curis team and the tremendous backing from our clinical investigators. I want to take a moment right now to say thank you and share my appreciation with all those involved; during our conversations with FDA, we also managed to confirm that 300 milligrams BID is the recommended Phase 2 dose for monotherapy in leukemia; with that locked in, we’re thrilled to share that we are broadening monotherapy enrollment in the TakeAim Leukemia study at 300 milligrams BID for relapsed/refractory patients who have spliceosome or FLT3 mutation. Beyond that, we’re collaborating with our clinical investigators on a frontline study that pairs emavusertib with azacitidine and venetoclax to treat all AML patients no matter what their mutation status is. We anticipate having data from both the monotherapy and combination studies during 2024; let’s now shift over to our TakeAim Lymphoma study, where our focus is on patients with primary CNS lymphoma. There’s a significant unmet need among this patient population, and we think that pairing emavusertib with ibrutinib might potentially solve the issue of ibrutinib resistance and deliver a meaningful new therapeutic option for these individuals. We are presently enrolling patients and anticipate having data in 2024. Turning to the financial side, we managed to further bolster our balance sheet through a $15 million equity financing completed with no discount and no warrant coverage. I’m certain everyone listening knows just how uncommon that is given today’s market. Overall, it was a fantastic quarter for Curis, and we’re eager to be back in the clinic at the recommended Phase 2 dose of 300 milligrams and working closely alongside our clinical investigators to develop a novel therapeutic that could potentially become a cornerstone therapy in heme malignancies. With that, I’ll hand the call back to Diantha so she can go over our financial results for the quarter. Diantha?

Thanks, Jim. Curis posted a net loss of $12 million, which works out to $0.12 per share, versus a net loss of $15.9 million, or $0.17 per share, during the same period in 2022. For the six months ended June 30, 2023, Curis posted a net loss of $23.5 million, or $0.24 per share, versus a net loss of $32 million, or $0.35 per share, during the same period of 2022. Second quarter 2023 revenues came in at $2.2 million, versus $2.4 million during the same period in 2022. For the six months ended June 30, 2023 and 2022, revenues were both $4.5 million. Second quarter 2023 research and development expenses came in at $10 million, versus $12.3 million during the same period in 2022. The drop in research and development expenses for the quarter is mainly due to a decrease in personnel costs. For the six months ended June 30, 2023, research and development expenses came in at $19.2 million, versus $23.8 million during the same period in 2022. Second quarter 2023 general and administrative expenses came in at $4.2 million, versus $5.1 million — excuse me, versus $5.1 million during the same period in 2022. The drop in general and administrative expenses was mainly driven by a decrease in personnel costs. For the six months ended June 30, 2023, general and administrative expenses came in at $9 million, versus $10.8 million during the same period in 2022. For the second quarter of 2023, other income net came in at $0.2 million, versus other expense net of $0.9 million during the same period in 2022. Other income net came in at $0.2 million for the six months ended June 30, 2023, versus other expense net of $1.9 million during the same period in 2022. Other income and expense net mainly consists of interest income partially offset by expense tied to future royalty payments. Including the proceeds from the July financing, cash, cash equivalents and investments at Curis totaled $77.4 million and there were roughly 117.7 million shares of common stock outstanding; we remain in a strong cash position and expect that our existing cash, cash equivalents and investments should enable us to maintain our planned operations into 2025. With that, I'd like to turn the call over for questions. Operator?

Hello there. Good afternoon, everybody, and well done on all the advancement — truly a strong quarter.

Thanks. Soumit.

I'd appreciate a bit more detail on what that conversation with the FDA was like and how they regained confidence to make 300 milligram BID the dose going forward?

Absolutely, glad to. It unfolded precisely as we had hoped it would. It simply happened on a quicker timeline. When the hold was first placed on us, as you're aware, their initial concerns centered on the patient death that occurred 15 months ago; they reached the very same determination we had in short order — that underlying disease caused it, not the drug. From there we shifted straight into a project optimist conversation, which explains why this has involved more than a year of effort. In their opinion, they favored the approach we took in deciding to test three doses — 200 milligrams, 300 milligrams and 400 milligrams — and they concurred that each of those doses was safe and each produced a response, more or less a high class headache. And although they preferred 300 milligrams over 400 milligrams for precisely the rationale we gave, that it appeared we were achieving comparable responses at both levels. Regarding 200 milligrams, they felt insufficient patients had been tested; thus their only real request was to enroll additional patients on drug, and as you're aware, they wanted nine additional ones, so enroll additional patients on drug, analyze the data, redo the analysis and inform us whether you land in the same spot; and the outcome was in fact pretty clear-cut. We carried out precisely what they requested. We enrolled nine additional patients on drug, we assembled the data, generated the report, dispatched it to FDA and it was in fact a very clear-cut conversation. 200 milligrams is a good dose, it's an active dose, but 300 milligrams appears to be somewhat better. So I'm glad it landed where we thought it would land; and clearly I'm extremely glad that the FDA acted faster than we had expected.

Great; this is a really good news.

Yes.

So what's the timing for the next look at the data, at least for the 200 milligram dose — something longer-term — or should we assume everything lands in the middle to back half of 2024, along with the 300 milligram and the combo study?

Right. We're somewhat reluctant to lock ourselves into a specific date. In the update we provided through the press release, as you're aware, we put forward 2024. The reality is we attend every big medical conference. So we're constantly engaging with our investigators and, naturally, with analysts, and our goal is to release data as quickly as you'd like to receive it. From our side, the challenge now is that since we know our dose is 300 milligrams, we need to get sites activated and enrolling as rapidly as we can. At this early point, it felt premature to promise that data would definitely arrive before the year closes. That's the reason we stated 2024, though the particular conference within 2024 is still undetermined. We hope to provide an update on that during the remainder of this quarter, once we have clearer visibility into enrollment.

Understood. That makes complete sense. Regarding the venetoclax combo study in first-line treatment, my guess is you'd keep doing genotyping on those patients and maintain the record when IRAK4 mutations, FLT3, and other mutations are present, then present the results across those subgroups if that becomes necessary.

Right. So we're still examining those results and gaining further understanding about emavusertib within that group. As we've disclosed more publicly, thanks to our conversations with FDA, we now have a quite well-defined path forward. We're aware that this medication, starting from its mechanism of action through preclinical findings and on to clinical results, acts precisely where we'd anticipate it would when given alone. It performs well in people who carry FLT3 or spliceosome mutations, and that's the direction we're taking for monotherapy. Yet keep in mind that IRAK4 Long isn't merely the biggest single genetic driver of illness across this AML/MDS spectrum — it's additionally over expressed throughout the whole population. In 50% of patients there's enough of it that monotherapy succeeds; the remaining 50% still carries a meaningful quantity, just not as much as what monotherapy handles. Therefore our plan for this medication is: in the narrowly defined genetic groups where it should be differentially active — and so far appears to be — we'll pursue single-agent use in the relapsed/refractory setting, again, FLT3 and spliceosome. For everyone else, we'll pursue first-line combination therapy, since we believe that's the sensible approach. Within AML, aza/ven is the standard of care. Thus we intend to use aza/ven in the frontline combined with emavusertib, all comers, regardless of which mutation is present. In MDS, given the recent magro release from Gilead, I'd say the standard-of-care question remains somewhat unresolved; we're still awaiting results from the aza/ven trial, and it isn't clear precisely which regimen constitutes that standard of care. Consequently, it's also unclear what we'd want to combine emavusertib with. So — right now, our effort involves talking with our physicians and KOLs to determine the most suitable approach for this medication. Over the longer term, our general view is that this drug will be used as a single agent wherever that's appropriate — namely spliceosome and FLT3 mutation — and in all other situations it will be used in the frontline, all comers, with no filtering required. That ran quite long. I hope it was useful.

No, that was really useful. Thanks. And thanks once more for taking the questions, plus congratulations.

Thanks. I truly appreciate that. Thanks for joining the call.

Hello, and let me also say congratulations regarding the advancement.

Thanks.

For my first question, about TakeAim Lymphoma and PCNSL specifically, could you provide additional detail on where the study design stands right now and, ultimately, the expected timing for when data will come out? Any further context would be quite useful.