Erasca, Inc. ($ERAS)

Hey, everyone. Thanks for joining the session with Erasca. My name is Alec Stranahan. I cover SMID Biotech at Bank of America. And I'm covering analyst for Erasca. And I have the pleasure of introducing and being joined by Jonathan Lim, Chairman and CEO; and David Chacko, Chief Financial Officer and CEO of Erasca. Thanks for being here, guys.

Thank you, Alec. Great to be here.

Yes. Looking forward to the conversation.

Maybe just to start, just to put the updates in context, and we'll definitely dig into those. But just at a high level, we've seen an evolution in RAS targeted therapies over the past 10 years, right? It started with unlocking the binding site for KRAS G12C. And now we've advanced to G12D and pan-RAS. You recently presented your Phase I update for double -- for ERAS-0015, which is your next-generation pan-RAS inhibitor. Response rates that were potentially best-in-class. So maybe just to start off, I guess how are you viewing the competitive setup for your RAS programs broadly? And what are sort of the upcoming readouts that get you most excited?

Yes. So you talked about the evolution of the space. I mean I think we're at a really exciting point in history in targeted therapy where you can go after a previously intractable target like RAS and actually have a pan-RAS compound make a difference there. So I think it's really exciting from the early days of G12C to pan-RAS and then seeing some of the mutant specific data coming out where we're really in a renaissance period. So as far as our RAS targeting franchise, I mean, our name, Erasca really stands for a twin mission of erasing cancer, and eradicating RAS-driven cancer. And so with ERAS-0015, our lead molecule. For pan-RAS, it's a molecular glue that's really showing high differentiation in terms of the preclinical profile. And then we're also really excited by the data that we presented, which we'll talk more about. And then ERAS-4001, which is a pan-KRAS compound. So I think the fact that we have both molecules with orthogonal mechanisms of action, I think that's really exciting because we can explore the full range of clinical activity as monotherapies and then also with standard of care and then with each other. So as far as ERAS-0015, big picture, we're super excited about the data that we presented. I think on the monotherapy front. When you look at the big 3 tumor types, clear differentiation in terms of non-small cell lung cancer. So you're seeing 62% to 75% response rates within the pharmacologically active dose of 16 to 32 milligrams within non-small cell lung cancer. So depending on what subgroup you look at in the second, third line setting, in the post checkpoint platinum setting, 75% response rates really is just eye-popping. So we're really pleased and excited to see that. And then in pancreatic cancer, we're seeing 41% response rates in the second line only setting in China. I think the data are maturing. And so we've gotten a lot of questions about that, but we're really excited that if you look at the 3 legs of the scientific stool, in terms of China lung data, U.S. lung data, China pancreatic data, those 3 legs of the stool are super strong. So we don't see any scientific reason for the U.S. pancreatic data to come in any differently from those 3. But when we talk a little more about the opportunity in pancreatic, we think it's still a really exciting area, high unmet need. And yes, there is a comparator that is showing phenomenal data in the second-line setting, but we think there's still some ample opportunity for another player to enter into that space. And then just to finish off on the big 3. Colorectal cancer is a very interesting area, which unfortunately has high unmet need and the fact that we're showing combinability with panitumumab with 16-milligram dose, which is the lowest end of the PAD, the fact that we're seeing early safety, tolerability and combinability there as well as activity in the form of partial response in the first efficacy evaluable patient on first scan. Well, we were really excited to see that because it means that 16 milligrams is an active dose in an otherwise very difficult to treat patient setting in the form of CRC. So if that holds, and we can clear the DLT window at that dose and then also explore higher doses, even if it's just 16 milligrams that clears the fact that we have U.S. data of patients that are tolerating this is really promising.

Yes. Great. And like you said, Jonathan, the data that you showed for ERAS-0015, especially in the KRAS G12X non-small cell lung were among the highest observed with any molecular targeted RAS therapy. I guess what from the data set and if you want to sort of dig into the top line numbers that we saw that you presented makes you most encouraged about the profile that's emerging for ERAS-0015 and what are sort of your high conviction path, whether it's patient populations, tumor types, combinations for pivotal?

Yes. So I think the opportunity in lung is open for us in terms of RAS mutant non-small cell lung cancer. So by line of treatment, if you just look at the second, third line population that's post platinum as well as checkpoint inhibitor, that's sort of the way to think about that population is the docetaxel eligible population. So docetaxel, unfortunately, is really the standard of care there, and there's ample room for improvement. And so the fact that we're seeing 75% response rates there is really exciting. I think the second-line setting for us is open in terms of a path for monotherapy. And so we look forward to -- at this point, we've opened up expansion cohorts at what we call the RDE. So the recommended doses for expansion are at 24 milligrams and 32 milligrams. So we've expanded that out, and we're enrolling patients with non-small cell lung cancer at both of those doses. So once we have, call it, 20 patients in each of those expansion cohorts, then we'll package that data, have a conversation with FDA and then see what the registrational trial looks like. But we do think that a path is an open avenue for us. And then at the same time, you probably saw the news with respect to the clinical trial collaboration and supply agreement that we signed and announced with Merck. So we're very excited to work with them to get access to pembrolizumab, which is really the standard of care right now in first-line lung. So our plan is to combine pembro with ERAS-0015. When we filed our 10-Q, we disclosed that we're already enrolling that cohort. So that's started ahead of schedule as well. And so we'll identify the combination dose and then we'll seek a first-line indication for non-small cell lung in combination with pembro.

Okay. I guess one more question on the response profile that you're seeing and the headline numbers look really, really good. I guess in terms of cadence of updates from this dose expansion or dose escalation portion, do you expect that you'll be able to confirm the majority of these responses across both studies? And would this trigger an additional update maybe later this year? Or is it really kind of the first half of '27?

Yes. So our formal guidance is first half of next year. That's where we're committing to external update. I think in the meantime, we'll be enrolling patients. We'll basically be following the maturation of the data, both for lung as well as pancreatic in terms of the confirmation as well as when we talk about pancreatic cancer. But we have found that the minimum follow-up time as that increases, it's really important that the pancreatic responses actually deepen over time. So I think, especially in the U.S. where you have a number of patients that are on that border of deep SD in that 28%, 29% range. There's a possibility that those could deepen over time. So that's something that will certainly follow. And then at the same time, we are enrolling these expansion cohorts with the RDE, not just in lung, but also in pancreatic. So we'll go to follow those patients. I think the dose escalations, our priorities are exploring ERAS-0015 with standard of care. So we've talked about panitumumab for CRC. We've talked about pembrolizumab for non-small cell lung cancer. Next on deck is to be exploring chemotherapy combos for various indications, including pancreatic.

Yes. And I mean maybe we can speak to the tolerability profile, which I think blends ERAS-0015 really well to combinations. I know that there was a lot of focus after the update on the pneumonitis event. Even though this is something that we've seen with others in the class, maybe we could talk about the overall tolerability profile, how this sort of stacks up versus competing agents?

Yes. So maybe I'll speak to the overall tolerability and then David will chime in on anything I've missed. But overall tolerability, what we went into this update with a question is, is there going to be a trade-off between efficacy or safety tolerability? Or can you actually achieve a sweet spot where you could see potentially differentiated efficacy and differentiated safety and tolerability. So on the safety tolerability side, what's really interesting to us is that we're seeing numerically lower frequency and severity of rash TRAEs, GI TRAEs in the form of nausea, vomiting, diarrhea as well as stomatitis/mucositis. And so that both end is what's really exciting. The fact that you're seeing such strong efficacy signal in non-small cell lung cancer as well as promising signal in pancreatic and then combinability with panitumumab in CRC. I think the most objective marker, for instance, with rash is the fact that we have a pan-RAS inhibitor that has shown promising safety and tolerability with an EGFR antibody, which is really critical for CRC to shut the door on that acquired resistance propensity through EGFR. So all of that bodes really well. And then I do think kind of the drivers of why that might be happening is the higher CypA binding affinity. So the fact that when CypA is overexpressed in multiple solid tumor types, you just get this biodistribution of more drug in that tumor and local environment as opposed to in the skin and surrounding tissues. That plus maybe the lower predicted peak-to-trough ratio as driven by the longer half-life and lower clearance is another source of therapeutic window advantage. And then finally, the fact that we're at such low doses of PAD of 16 to 32 milligrams as opposed to much higher doses, so the GI tolerability should be much better. So big picture, we're really pleased with the emerging safety and tolerability data from this update as well as ongoing. Anything to add?

Yes. No, I mean, Jonathan covered it really well. I mean I think the -- on the rash, the fact that, as Jonathan mentioned, that we are quantitatively, we're better in terms of lower frequency and severity. Qualitatively, we're hearing from our investigators that the rash here is better than what they saw with the comparator compound. And then also on the ultimate proof in the pudding, so to speak, is the fact that you can combine as Jonathan mentioned, with anti-EGFR, which in and of itself causes [ skin ] rash. And then similarly, when you think about the GI toxicities that could be associated with this class, you want to think about combinations with chemotherapy and the fact that our rates are better, portends well in terms of our ability to combine with chemotherapies. And so Alec, you also brought up the pneumonitis and so maybe I'll just talk about that briefly as well. This was -- in this particular patient's case, and it was obviously a very bad outcome for the patient, and we acknowledge that. But in this particular patient's case, I think it's important to understand a few things with regard to the patient. This was a patient who had been on multiple lines of prior therapy and had -- he came into the ER with a Grade 3 pneumonitis -- because his underlying lung function was already somewhat abnormal in the sense that he had lung metastasis, he had prior cryoablation of the lung because of those factors, that adds a layer of complexity in terms of the development of this pneumonitis. And ultimately, having been a patient with cancer for as long as this particular patient was, I think he ultimately made a decision to withdraw supportive care. And so at that point, it progressed to a death, unfortunately. And we acknowledge that, and we are obviously taking that very seriously, but it feels like in this particular case, there were other mitigating circumstances that led to this particular outcome. And the PI also communicated to our team that he felt that, had the patient not withdrawn supportive care that this would have been a different outcome.

Yes. And we've certainly seen with others that if you do implement the prophylaxis for pneumonitis, probably this patient would have survived and have been okay.

Yes. And it's also worth noting that in targeted therapy and frankly, even beyond our targeted therapy to other oncology drugs, other non-oncology drugs. Pneumonitis is a known event. CDK4/6 inhibitors have anti-PD-1s and HER2, which is very successful drug has a very high rate of pneumonitis. And so it's one of those things to your point that once you know about it, you can monitor it, monitor for it, it's something that can be much more manageable.

Okay. And I guess one more question sort of around the combinability vis-a-vis the tolerability profile. We've seen the competing compound they've had to dose down, right, to be able to thread that therapeutic window in the combo. Do you think that's something that you'll also have to do?

And I think what's interesting, let's talk about pancreatic for the time being. I think the opportunity in first line is really interesting because, as you think about what's been demonstrated there, the second-line data is really strong. And then in first line, to your point, for the combo, they have to dose down and dose modify both sides of the RAS side of the equation as well as the chemo side of the equation. So if we explore combos with a better tolerability profile in terms of -- especially as you think about what the stacking tox could be from a GI and stomatitis perspective, if you can maintain a more full RDI or relative dose intensity on both sides of the equation, that could translate into efficacy benefit. So that's really exciting for us is to see what the opportunity is there for first line where the unmet need is 4x the size of second line for instance.

Right. Right. Maybe a question on the EGFR activity you're seeing. This was one of the first documented patient responses with a pan-RAS in combination with an anti-EGFR in colorectal cancer. Is this combination kind of additive or potentially synergistic mechanistically from the work that you've done? And what would you want to sort of see from the study that you're enrolling there to have conviction to begin a Phase III in colorectal?

Yes. So I think history can teach us a lot. And so if you look at the label for, let's say, panitumumab, which is the combination partner that we're working with. As a monotherapy in RAS-driven CRC, the response rate is 0. So when you put pani in a setting of RAS mutant CRC, you shouldn't expect anything. But yet, when it was combined with sotorasib in the G12C CRC setting, I think that response rate went into the high 20s. I think it was 26% or something along those lines. So that, to me, is not additive. It's quite synergistic. And then likewise, the fact that we're seeing so far, 1 for 1, 1 out of 1 response in combination with ERAS-0015 at 16 milligrams, you wouldn't expect that with pani. So I do think that, that could be a synergistic type of situation. Now as you look at the unmet need in RAS-driven CRC, I think you can also learn from history in a BRAF space. So we were in the BRAF space with encorafenib and what was interesting from BEACON is that BRAF inhibitor plus EGFR was approved in BRAF mutant CRC with response rates 20% and the DOR was about 6 months. So that's kind of the bar right now because the unmet need, especially in third-line CRC is so high that if you can get 20% response rates or higher, then that's meaningful from a registration-enabling perspective. So I think if we see something in that range or ideally higher than that is an area of unmet need where there's even more patients with RAS-driven CRC than there are in any of the other 2 big 3 tumor types.

Right, right, right. Just one question around the IP for ERAS-0015. Great to see the U.S. patent issue with composition of matter into 2043, I believe. Maybe you could just walk us through the distinct mechanistic basis, I guess, contemplated in the patent? And are there ways to maybe further expand the protection for assets in the pipeline?

Yes, that's right. So we did get a U.S. composition of matter patent. We announced that last October out to 2043, as you mentioned. And then with regard to the mechanistic aspect of your question, yes, this molecule has 2 distinct modifications on the chemical structure that have led to some pretty distinct advantages, both preclinically and clinically in the data that we've shown. So preclinically, we've talked about with you before, Alec, about the enhanced binding the CypA, the better in vitro potency on the order of 4 to 5x, the better in vivo activity, the better ADME PK properties. And then clinically with the data that we've shown that -- and we've talked about here in terms of both safety and efficacy, this molecule is showing really nice activity and safety tolerability, and it's driven by those 2 key mechanistic changes from a structural standpoint. And then in terms of your -- the latter part of your question with regard to kind of IP strategy. The short answer is, yes, there are a lot of different things we can do. We don't necessarily talk about all that publicly, as you can imagine. But there are a lot of things that you can imagine beyond just the composition of matter patent that allow us to kind of protect 0015.

Okay. And maybe one last question just around kind of the commercial outlook. The space is pretty quickly evolving. I think everyone can agree these are very large tumor types, high unmet need in PDAC, large incidents in lung. How do you see sort of your assets positioned in terms of developmental stage and sort of where the puck is going for the industry? Are you maybe leaning more on the combos? And I guess, how do you balance running the right studies that answer the right questions but also moving with a sense of urgency...

Yes. So we're a very nimble organization. We're capital efficient, but we also have some very interesting shots on goal, especially to your point, with the standard of care combos. So I think the fact that we already started the various standard of care combos for lung and CRC. That's really promising for sort of entry into multiple lines of therapy in those indications. And then I think next on deck is pancreatic cancer. We do think that second line pancreatic cancer will be difficult. So it's really all about a combination in the first-line setting. And then it really -- there's multiple areas of opportunity. I think people are under-appreciating the opportunity in non-small cell lung as well as CRC. So I think those are still open lanes for us and then first-line pancreatic for the reasons I suggested if you can maintain RDI with combo, I think there's potential safety, tolerability and efficacy gains to be made in that area of unmet need.

Okay. Great. Maybe we can shift gears now to ERAS-4001. This is your pan-KRAS inhibitor, structurally distinct scaffold versus, I guess, approved in competing programs. I think you've argued in the past that KRAS selectivity sparing HRAS and NRAS could improve the tolerability and maybe combinability, which, for example, like anti-eGFR agents like we talked about in CRC. I guess, looking forward to the Phase I monotherapy update in the back half of this year. Can we expect a similar breadth, depth of data to the ERAS-0015 update, medical conference investor events?

Yes. I'll answer that part in a second, but just going back to the premise of the question. Yes, I mean, I think the hypothesis around pan-KRAS as a field is exactly what you said that by sparing H and NRAS that you could get a better tolerability profile, particularly when it comes to something like rash. Now I think a key question, especially in light of the data that we just put out a couple of weeks ago with our pan-RAS program, where we did show a better rash rate and also combinability with anti-EGFR. The key question is whether with 0015, are we able to achieve some of the limitations that were perhaps surrounding the class earlier. But that said, I think with 4001 with our pan-KRAS, we are excited about that program. It's going to have a readout in the second half of this year. You can think about that in terms of dozens of patients. It's Phase I dose escalation. So things that you would normally expect in terms of safety, tolerability, PK, initial signs of activity which will then use to be able to then initiate the mono expansion and combo dose escalation work in calendar year '27.

Okay. Are there any, I guess, clinical thresholds that you're thinking about to feel confident in initiating those expansion I guess combination cohorts?

I think we'll keep an eye, of course, on -- as we generate data as the others in the space generate data. To date, there's just been very little to point to. A couple of companies have reported some initial data. And so obviously, we're monitoring that and anybody else that has data updates to come. And that will also help inform our go-forward plan. But I think at this point, just given the relatively nascent timing or the early nature of the space right now, I think it's -- there's still a lot for us to learn as we go along.

Yes. And I guess one higher-level question, in a world where there's a pan-RAS molecular glue and KRAS inhibitor. And this is something I think about, which is what's the benefit of having a pan-RAS when you have a more specific pan-KRAS or even more specific, like G12D or G12C. How do you sort of see these coexisting? Do they have overlapping markets? Is it a combinability or like an upfront debulking and then like a maintenance kind of approach? Like how are you thinking about how this plays out?

Yes. Those are all great question. There's been a lot of debate that I've heard around exactly that same thought, right? And where do these different assets play. I think our view is that most likely they will have their kind of maybe distinct swim lanes will be data driven, of course, in terms of if we see that one asset is playing better in this swim lane and the other asset is playing better in the swim lane, that's fine. As I alluded to, I think one of the advantages of the pan-KRAS is that by sparing H&NRAS, you can have that better tolerability profile, especially when it comes to rash. Now on the other hand, there was a paper earlier this year from [indiscernible] at all in science that talks about one of the liabilities of sparing H&RAS is that you can get bypass via PI3K. And so that can lead to resistance. And so that's where a pan-RAS that hits all 3 RAS isoforms, H,N,K might have an advantage. Now the question there with pan-RAS is the tolerability question. But again, going back to what we mentioned with regard to our data update last month, we feel that our pan-RAS does have a good tolerability profile. So a lot of this is still evolving. The mutant selective, you brought that up as another option, and we're certainly monitoring that space as well. I think one of the key questions with the mutant selective as well is that a lot of them spare wild-type and wild-type amplification is also another potential avenue for resistance to develop. And so you have to kind of look at all of these different puts and takes in terms of what are the pros and cons of these different approaches. I think the nice thing for us being perhaps the only company or one of only a few companies that have both a pan-RAS and a pan-KRAS is that regardless of how the field evolves, we've got a strong answer.

Yes. I'd say at this point, you guys are probably the premier experts on the MAPK pathways, just given the years of the development experience you have. Maybe last question, just on the go forward when you think about the combos. Where do you lean in on in terms of the combination partners? Obviously, you've got the supply agreement with Merck for KEYTRUDA, you've got the supply agreement with Tango for their combination study with their PRMT5. Where do you sort of see the biggest opportunity when it comes to combos at least initially?

I mean I think as we outlined, we have a lot of optionality. And so I think first order of business in terms of prioritization is what is the standard of care in the areas where we can make the most patient impact. So it's really in the big 3 and with the standard of care? And then where is the puck going to potentially go, and how can we skate there? Well, that's where working with Tango, for instance, with PRMT5 for a chemo-free solution within pancreatic and possibly lung, that's very interesting as well. So we really want to keep our eye on the future as well as, keep our eye on what has historically worked for many years with thousands of patients of data. That's where we want to adequately combine with standard of care and then while also not taking our eye off the ball in terms of additional innovation.

Okay. And maybe just one last quick one in terms of capital allocation. How do you be good stewards of capital while driving forward the promise from the pipeline? Are there certain applications that you would partner out or tumor indications that you want to keep in-house?

I think we've shown that, for instance, in terms of -- with the PRMT5, we're really sort of letting Tango drive that, and then we're keeping our eye focused on the core indications where we can really devote our financial and human resources to pushing those forward. And then you've known us for a long time, in terms of just how we deploy capital, we're very efficient in terms of our use of capital and our cost structure is just very different from a lot of companies out there. And we are singularly focused on the RAS targeting franchise. So we're as pure play a RAS option for investors as it gets.

Yes. Great. Well, I think with that, we're out of time, so we'll leave it there. But really want to thank Jonathan and David for the great conversation. Thanks for being at the conference. Really appreciate it. Thank you.

Thank you.

Thank you.