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

Thanks for joining us, and welcome to the Curis business update call for the third quarter of 2024. First off, I'd ask that all of you head over to the Investors area on our site, www.curis.com, where you can locate the press release covering our third quarter 2024 business update along with the accompanying financial tables. I also want to note that on this call, forward-looking statements will be made, and those rest on what we currently expect and believe. Such statements carry specific risks and uncertainties, and what actually happens could look quite different. For more information, please check 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 session will also take place once the call concludes. At this point, I'll hand things over to Jim.

Thanks, Diantha. Good morning to all, and I appreciate you joining Curis' call covering our third quarter business update. We'll begin by discussing our TakeAim Leukemia Study, in which emavusertib is being assessed alongside ibrutinib among relapsed/refractory PCNSL patients whose disease progressed following a BTK inhibitor. Typically, such individuals receive a methotrexate-based regimen as frontline therapy, incorporating chemo or radiation, and then get a BTK inhibitor once their disease advances. Once that salvage-line treatment stops working, these patients qualify for enrollment in our trial, where they receive emavusertib combined — pardon me — with ibrutinib. The rationale behind this pairing, backed by preclinical findings as well as our initial clinical results, holds that simultaneously blocking the two pathways that drive NHL — the TLR pathway via emavusertib and the BCR pathway via ibrutinib — may allow patients to attain an objective response despite having already progressed on ibrutinib. Back in September, during the third annual IRAK4 symposium in Cancer, we shared an update on our PCNSL data covering 10 evaluable patients. Those findings demonstrated 3 complete responses, or CRs, 1 unconfirmed complete response, or CRu, plus 2 partial responses, or PRs. Among the 4 patients who had a CR or CRU, 3 experienced a duration of response exceeding 6 months. This information remains quite preliminary, yet it is also encouraging, particularly considering the substantial unmet need within this population; we keep enrolling patients into this trial and are actively working with regulatory authorities to reach alignment regarding the registrational path. As a reminder, this trial is being conducted across the U.S., Europe and Israel. Needless to say, establishing the registrational route toward approval represents a crucial next step for emavusertib's development, and I'm happy with how things are progressing. Let's now shift to our TakeAim Leukemia Study, which is assessing emavusertib as a monotherapy among patients with relapsed/refractory AML. At ASCO and EHA earlier this year, we shared updated data on patients carrying a FLT3 mutation. Those results indicated that 6 of 11 evaluable patients reached an objective response, comprising 3 CRs, 1 CRh and 2 MLFS. Worth noting as well, 3 among those 11 patients had not previously received a FLT3 inhibitor. Each of those 3 patients attained an objective response, and 3 of the other 8 patients — the ones whose prior FLT3 inhibitor treatment had failed — also attained an objective response. At next month's ASH meeting, a broader data set covering 19 response-evaluable patients is scheduled to be presented by Dr. Eric Winer from Dana-Farber during an oral presentation on Monday, December 9. Additionally, we'll share updated data from our study involving high-risk MDS patients through a poster by lead author Dr. Guillermo Garcia-Manero from MD Anderson, presented on Sunday, December 8. All in all, I'm quite pleased with how things are advancing across both our TakeAim Leukemia and TakeAim Lymphoma studies, and I look forward to offering further updates as the year moves along. With that, I'll hand the call to Diantha or the financial update. I'll turn it over to Diantha.

Thanks, Jim. For Q3 of 2024, Curis posted a net loss of $10.1 million, which works out to $1.70 per share, versus a net loss of $12.2 million, or $2.13 per share, during the same quarter in 2023. Over the 9 months that ended September 30, 2024, the net loss came to $33.8 million, or $5.77 per share, compared with $35.7 million, or $6.96 per share, in the equivalent stretch of 2023. R&D spending stood at $9.7 million in Q3 2024, down from $10.4 million a year earlier. That decline mostly reflected reduced consulting costs and employee-related expenses. For the 9 months concluded September 30, 2024, R&D expenses reached $29.6 million, essentially level with the $29.5 million recorded in the same period of 2023. G&A costs were $3.8 million during the third quarter of 2024, compared to $4.8 million in the corresponding quarter of 2023. This drop was chiefly driven by lower legal and employee-related costs. G&A expenses came in at $13.4 million across the 9 months ended September 30, 2024, against $13.8 million for the same span in 2023. During October, we closed a registered direct offering alongside a concurrent private placement of unregistered warrants, generating net proceeds of roughly $10.8 million. Once the October 2024 offerings are factored in, Curis' cash and cash equivalents reached $31.6 million, with approximately 8.5 million shares of common stock outstanding. Curis anticipates that its current cash and cash equivalents will fund its planned operations into mid-'25. With that said, I'd like to open the call up for questions. Operator?

Morning. Appreciate you taking my questions.

Morning, Ed.

Morning, Jim. You said you're trying to get on the same page with the FDA regarding PCNSL, which suggests you're not currently aligned. So what has to happen now to reach that alignment? And in your view, what would the optimal route to approval be?

Sure. I wouldn't characterize us as misaligned at all, not by any means. I'd simply say we're in the middle of talks. Here's what we're seeing — and we've mentioned this before on calls, back in the early part of this year, when the first data started coming in for these patients — we found that results in salvage line therapy were, honestly, superior to what we'd anticipated and superior to second line. And despite the fact that this involved a limited number of patients, we felt compelled to go straight to the FDA and ask whether an accelerated pathway might be possible for this drug. As you know, the standard route to approval involves finishing a Phase I/II study, running all the reports, holding an end-of-phase meeting with FDA, and then discussing with the FDA what the registrational design should be. We figured that since there's such a serious unmet need — nothing is approved for this — and the salvage line data we're seeing look, honestly, outstanding, we might be able to move faster. So that's what we're discussing at the moment: can there be an accelerated approval path? And if there can, what would it involve? My hope is that, with those talks, we'll hopefully find ourselves in a position to have some clarity in Q1, though that remains to be seen. At this stage, I think we're just thrilled about the data, and we're happy that the FDA is working with us to figure out an accelerated or at minimum quicker pathway.

Thanks, Jim. Now, Diantha, this one might be for you. G&A, meaning general and administrative, dropped roughly $1 million compared to the prior quarter, while R&D declined by approximately $0.5 million. Given that you're moving further along in the clinic, what's the right way to view costs ahead — both for Q4 and for how spending will be paced across 2025? I realize it may be tough since you're still awaiting word from the FDA, but I was hoping to hear your preliminary take.

Sure. I appreciate that, Ed. Our burn rate historically has sat in what you could describe as the $10 million to $12 million range. Earlier this year we made some adjustments to costs, which pushed that burn lower. Still, I'd anticipate that Curis's typical burn in 2025 likely remains near that $10 million — right at the $10 million level; manufacturing schedules will cause some fluctuation. That said, on the whole, I'd basically go with that $10 million figure.

All right, excellent. Appreciate you letting me ask a couple of things.

Sure thing. Thank you, Ed.

Good morning. Someone raised a question about Emma's potential role in hrMDS, drawing on the abstract presented at ASH. The responses seen in spliceosome mutants are quite striking, and given all of your prior disclosures, that's not surprising at this point. Still, we want a clearer picture of the broader opportunity, especially in light of the specific gene signature effects you've reported. For example, what portion of the MDS population carries those mutations? Is it 10%, 15%, or something larger? Also, given that VERONA data are still pending, is it reasonable to pursue a doublet without ven in hrMDS — do HMA and MOA work together synergistically or additively enough to justify that approach?

Yes, hello Bill, and thank you for joining and asking. That's a really good question. To begin with, I'd agree that MDS is something that hasn't gotten enough attention. We're quite enthusiastic about it and eagerly anticipating what's ahead. It's a tough group of patients, as you're aware. Before VERONA reports its findings, aza remains the standard treatment. However, after patients have been through that, there's essentially no remaining option for them. That makes the potential here truly outstanding. As you're aware, we've observed quite a few responses, with more marrow CRs than CRs. We're also noticing activity among patients who have FLT3 mutation, as well as those with splicing mutations. So right now, we're looking into whether different dosing schedules could work, and maybe pairing emavusertib with other drugs too. Like you mentioned, what that combo ends up being will depend heavily on what comes out of the VERONA readout. That said, I'd call this a conversation that's still taking shape. We can't wait for the data update Dr. Garcia-Manero will be sharing at ASH. With any luck, that sets up a genuinely thrilling conversation as we head into 2025. But yeah, thanks for keeping an eye on MDS — it doesn't get the same attention from everyone that it gets from us.

Thanks.