ESSA Pharma Inc. (EPIX) Earnings Call Transcript & Summary

Good afternoon, everyone, and thank you for joining the H.C. Wainwright 2021 Global Life Sciences Conference. My name is Tatenda Zenenga, and I'm an investment banking analyst here at H.C. Wainwright. While we are virtual this year, we're confident we're going to be able to provide value to you with over 425 companies presenting at this conference as well as view your interactions through one-on-one meetings. As you know, H.C. Wainwright is a full-service investment bank, dedicated to providing corporate finance, strategic advisory and related services to public and private companies across multiple sectors and regions. We have a total of 18 publishing senior analysts, and 493 companies covered across all sectors. Please visit hcwco.com for more information. From a logistics standpoint, please make sure to reference to your virtual conference online portal that provides your individual links to your meetings and all presentations. Panels and all presentations are available on demand from March 9 through the 10th. With that being said, have a productive and enjoyable day, and I'd like to introduce our presenter, Mr. David Parkinson, the President and CEO of ESSA Pharma. David, take it away.

Thank you, Tatenda. Well, it's a pleasure to be here with you today. I'm here representing ESSA and the staff at ESSA. And what I'd like to do over the next 20 minutes is tell you about a unique way of shutting down male hormone-driven signaling, an important driver of prostate cancer. This is a company based on technology, originally coming out of the University of British Columbia, British Columbia Cancer Agency in Vancouver. We currently have sites in Houston, South San Francisco and Vancouver. And what we're talking about are a series of agents, we term, anitens, which shut down hormonal signaling in prostate cancer and do so in a unique way. That is they interfere with transcription by working at the other end of the androgen receptor, thereby blocking the resistance -- or bypassing the resistance mechanisms associated with current anti-androgens. And I'll be talking a little bit about where we are with the program and why the biology and the mechanism of action of this agent is potentially so important to the natural history of prostate cancer. And I'm here representing my colleagues today, Peter Virsik, our Chief Operating Officer; David Wood, our Chief Financial Officer; and Alessandra Cesano, our Chief Medical Officer. As you can see from Slide 4, we're all experienced drug and diagnostics developers. So we know the drug development space. And the reason we're here to talk to you today. The reason we're doing what we're doing relates to the fact that it's been known since the 1950s that prostate cancer is uniquely driven by male hormones. And that has translated into 60 years of drug development, with incrementally better ways of shutting down male hormone-driven biology through the androgen receptor. Currently, the latest generation of anti-androgens represents a global market of greater than $7 billion in annual sales. But the unmet medical need still remains. All patients eventually, if they live long enough, will become resistant to current anti-androgens. We'll talk about the mechanisms of that. And what's really important to today's discussion is that even when these tumors progress on current anti-androgens, the pathway is still on, and it is believed that the drive behind these tumors is still androgen-driven biology in large part. Now on Slide 6 is a cartoon representing the androgen receptor. This normally sits in the cytoplasm of prostate cancer cells, in comes dihydrotestosterone, an androgen male hormone, binds to the right side of the cartoon, activates the receptor. The receptor translocates to the nucleus. A dimerization event occurs. And then the activated receptor is binding to the genomic DNA in very specific sites called androgen receptor elements, and thereby, driving transcription of the genes associated with male biology. Now that specific binding does not occur without the left part of the molecule as represented in this cartoon, the end terminal domain. And the reason it's portrayed as a squiggly kind of representation is that it is intrinsically disordered. Doesn't have a formal 3-dimensional structure that is the overall N-terminal domain, there are subsets of probable structure. It's impossible to get a crystal to date of the N-terminal domain. And therefore, classic ways of going at drugging the N-terminal domain have not been successful. Now also on this slide, in the upper left-hand corner is the results of 60 years, that's 6 decades of drug development, increasingly better anti-androgens finally resulting in the 4 big antigens, Zytiga, which interferes with synthesis of androgens and the decreases the level of circulating androgens. And then the 4 big recent lutamides, enzalutamide, apalutamide and darolutamide, all of which are important blockers of androgens' binding to the right side of the receptor. Now also on the right side of the slide are listed the mechanisms of resistance to these anti-androgens. And unsurprisingly, whether at the DNA level or at the RNA level, they represent interactions and mechanisms of resistance based on the ligand-binding domain, that right side of the cartoon. So on the next slide is represented the work of the scientists in Vancouver, Marianne Sadar, Biologist; Raymond Andersen, Natural Products Chemist, who found an extract from a sponge in the harbor in Papua New Guinea. Showed that, that extract shutdown androgen-based signaling, even in prostate cancer cell lines resistant to anti-androgens. And then subsequent work at the University of Barcelona showed that a compound derived from that initial extract actually bound to an area called transcription activating unit 5 or TAU-5 in the AF1 region of the N-terminal domain. By doing so, it seems as though confirmational change occurs, the assembly of the cofactors necessary for the activated receptor to bind and transcribe at those specific areas, I mentioned on genomic DNA, is interfered with. So a unique mechanism of action, leading to unique ways of shutting down androgen biology. Now on this next slide, Slide 8, is represented by, again, the cartoon form, the natural history of prostate cancer and the history, if you will, of the development of therapeutics against prostate cancer. And initially, the disease is often found localized. It's given localized treatment with surgery or radiation. It's then followed -- patients were followed by the marker, PSA or prostatic-specific antigen. As PSA rises, that has been the setting in which the lutamides or antigen deprivation therapy was introduced. These are the LHRH agonists or antagonists that works centrally to decrease the amount of circulating androgens. And then subsequently, if PSA rose again, that's the setting in which the lutamides were developed. Now what's happened in recent years is that the use of these lutamides has been shown to be even more beneficial when moved up in combination with androgen deprivation therapy, thereby shutting down both the amount of circulating androgen as well as it's -- the ability of the remaining circulating androgen to bind to the receptor. That has translated into improved prostatic progression-free survival and improved overall survival. These are important drugs. They are great drugs that are generally quite well tolerated. And they've been important additions to the therapeutic armamentarium over the last several years in prostate cancer, but all men become resistant. So what we will be talking about here in the next few minutes is basically the introduction of our latest generation aniten, that is an N-terminal domain androgen receptor inhibitor, which interferes with transcription in the manner that I described and which we have just entered over the last several months into clinical trial in men with advanced prostate cancer. Now the history of the company goes back to the early 2000s and then around 2009, 2010, the company was initially formed. In the year late 2015, early 2016, a Phase I study was initiated by the company with a first-generation aniten, EPI-506. We arrived at the company around that time with the Phase I trial underway, managed the Phase I trial, showed that this was an operative mechanism of activity that these men who entered the clinical trial with rising PSAs did show -- in the men who received the highest levels did show some decline in PSAs. But frankly, the drug was well tolerated as the toxicology had predicted. But the PSA declines were not sustained and we're not deep enough to represent a clinically meaningful effect. We knew we needed a better drug. We reconfigured as a preclinical company, spent 1.5 years developing a next-generation molecule that made up for the issues that we found in that first-generation molecule. And so we worked to improve the potency and came up with EPI-7386, which is 20x more potent than 506 in vitro studies. We also needed a drug that would continue to maintain the same specificity and selectivity that 506 had shown and 7386 by all characterizations and does so. We needed a drug that showed the same clinical activities or preclinical activities in animal models that was active not just in androgen-sensitive models but in anti-androgen resistant models and 7386 does that. We also needed a drug with a long half-life. We're attempting to interfere with transcription, and for that, we need drug present 24/7, so a long half-life. We needed a drug that could be combined with other drugs. These are older men in general. They are receiving other medications. And in addition, as we'll talk about, the importance of 7386 is not just as a single agent to rescue men who are progressing on current anti-androgens, but potentially in the future, even more importantly, to be combined with those same anti-androgens in earlier line men and basically to shut down androgen biology to levels not seen to date, both quantitatively superior but also qualitatively with additional biology captured or interfered with. And then finally, we needed a drug that could be given as an oral tablet once a day, and we have such a drug now. On Slide 11, we basically show that in the animal models with exposures, area under the curve, these are units of at least 80,000, we could see activity in certain sensitive models. But once we were past 300,000 area under the curve, we, in fact, we're seeing reproducibly activity in the whole range of anti-androgen-resistant models that we studied. The toxicology was very clean. Because of a suspension formulation that we were able to develop, we were able to give huge amounts of drug and showed that the drug was extremely specific and extremely well tolerated in these animal models, allowing us to start at a dose of 200 milligrams with a predicted AUC of 137, which, as I indicated, would be in an area where we might expect to see biological and potentially even clinical activity. And on Slide 12, we basically show that the Phase I trial of 7386 began last summer in the middle of COVID. But nevertheless, the trial has moved along quite well. As you might expect, these are men who have been on anti-androgens and often many, many other lines of therapy and have had the disease for 5 or 10 years. It's a classic Phase I design with 3+3 design. And the goal is to get to a recommended Phase II dose, show safety, tolerability, and if possible, clinical effects. But certainly, PSA responses would be a good biomarker of interference with the pathway. Importantly, we're doing a lot of parallel biological studies. Because, in fact, these are late-stage patients. They have complicated biology. And we know that while AR may be the predominant driver in these late-stage patients, many of them have also received chemotherapy, and many of them have other genomic changes that are partial drivers in addition, perhaps, to AR. So the study has been ongoing since the late summer last year. In addition, we'll be talking a little bit about the combination clinical trials that we intend to begin later this year. So at the ASCO GU meeting a few weeks ago, we showed the first clinical data. This was a poster designed to show the performance characteristics of the drug. We had, had a first-generation drug. It seemed to be on target. It seemed to have that right mechanism of action. What it didn't have was good pharmaceutical characteristics. We spent 1.5 years improving the pharmaceutical characteristics. And to do so, we brought this agent in the clinical trial, again, same kind of design, same kind of patients, they have been on anti-androgens. Their tumor is progressing. Their PSAs are rising. They enter the trial. And on Slide 14, we just show the kind of predictions that we had made and that we showed the results of our clinical characterization in the first cohort at the ASCO GU meeting. So we had predicted the drug with a long half-life, some 30 hours. We predicted that we would get exposures at the 200-milligram level of around 137,000 as I just mentioned. And that would tell us that we probably were aiming to get to 600 to 800 milligrams a day, again, oral tablets once-a-day to get the kind of exposures that we would expect to be uniformly effective against the antigen receptor. And what we see on Slide 15 is that, basically, we have achieved all of those characteristics. The half-life here is listed at 24 hours or so. In fact, it's probably 30 or more for technical reasons. It's hard when patients are taking a long-lived drug once a day to get an accurate to t1/2, but it's probably going to be around exactly what we have projected. Just as important are the exposures and at 200 milligrams at day 28 after the drug had accumulated because long half-life drugs takes about a week to equilibrate. At day 28, we were seeing exposures of 147,000 as opposed to our predicted 137,000. So already, we were seeing in the context of a drug that was quite safe and was very well tolerated -- excuse me, the drug was at the exposures that we were hoping to see for this first cohort. In addition, by the way, we measured the ratio of 4 beta-hydroxycholesterol to total cholesterol and showed no induction, at least at that initial cohort. The importance of this is that we don't want to see a drug that is a huge inducer of CYP3A. That would complicate -- if possible, that would complicate interactions with other drugs. Now the clinical results are shown here. And importantly, the drug was very safe, was well tolerated. The toxicities that are possibly associated are in the lower right-hand corner. The only one that is probably directly associated were the hot flashes, which is a good sign. It's a sign of androgen inhibition. You see there were 4 patients on the first cohort, and 3 of them progressed. One of them quite rapidly, didn't even make it through the 4 weeks of observation. The more important patient to discuss is 01002 next -- on the next slide. So you see on the top our PSA changes in the 3 patients who made it through the 4 weeks of observation. Three of the patients progressed fairly rapidly. These are really late-stage patients with very aggressive disease. But patient 01002 is a very important patient in terms of representing on target and mechanism of action. This is a man you can see had several years of therapy for his prostate cancer. He had metastatic prostate cancer to bone and to pelvis. He was treated with several lines of therapy, had responded previously to Casodex, which is bicalutamide and enzalutamide and never responded to abiraterone in recent years. And then when put it on our drug, took about 12 weeks. His PSA began to decline. And as we indicated at the ASCO GU presentation, was continuing to decline at the time of the last measurement before the presentation was created. This was in the -- no side effects to speak of except hot flashes. So very well tolerated, feels well and has now been on the drug for more than 6 months. As we indicated for the ASCO GU presentation, in addition, we have now treated this man for more than 6 months and we indicated that we had cleared the 400 milligram level and moved on to the 600 milligram cohort. We, therefore, recently moved this man up to 400 milligrams once a day. So on Slide 18 is just a representation. We are starting of the relative prevalence of disease in this area. We are starting with the left-hand side cohorts. The metastatic CRPC, castrate-resistant prostate cancer. But as I indicated, we have generated data to suggest that combination therapy with our drug with anti-androgens is actually potentially extremely effective because of its ability to shut androgen biology down broadly. That is a huge market to be explored, and we will be exploring that in collaboration with the companies with the late-stage anti-androgens. We've already announced a collaboration around 2 separate studies with Janssen with their anti-androgens and most recently with Astellas/Pfizer with their anti-androgen enzalutamide. In terms of where the company is financially, we're in good shape. We had reported $74.5 million at the end of December. We just, in the last couple of weeks, raised another $130 million in a very successful financing. And we have excellent, excellent shareholders and very good analysts covering us. So milestones to watch this year. We will be declaring a recommended Phase II dose sometime in this next quarter and move on to an expansion phase. Meanwhile, in the third quarter of this year, we will be initiating these combination studies I just referred to. And in addition, we will be presenting clinical data on the results of our Phase I/II trial in the fall of this year. And so in summary, what we have in 7386 is a unique way of shutting down male hormone biology through inhibition of the N-terminal domain. We have a drug that is, in many ways, improved over the first generation compound but retains the same specificity and has excellent pharmaceutical characteristics. It, therefore, represents, we believe, an important new direction in offering a rescue mechanism for men who are progressing on current anti-androgen and whose tumors are still driven by male hormone biology. And very importantly, to -- for us to study will be earlier lines of therapy in men in combination with current anti-androgens. So thank you for your attention today, and I look forward to future discussions with you. Take care.

Thank you, David. Thank you for taking part in what has been a very productive and informative presentation. We appreciate the time and the effort that went into preparing it. Hopefully, our next conference will be one that we can hold in person rather than virtually. And in the meantime, we're grateful for your flexibility and your presence online this year. Thanks again, David.

Thank you.