Faron Pharmaceuticals Oy (FARN) Earnings Call Transcript & Summary

Welcome, everybody. So nice to be here with you. I know this is a day that a lot of you have been waiting for. We as well here at Faron, an exciting day. I would -- I can say that even a bit of anxiety building up, waiting to see are the results with bexmarilimab holding up, and we are pleased to see that, yes, they are holding up. But why wouldn't they, of course, results are expected. So we're going to discuss the results today. Here with me to discuss them is Professor Zeidan from Yale. Welcome.

Welcome. Thank you so much for the kind invitation.

And then we have our new Chairman of the Board to Tuomo Patsi.

Thank you. I am excited to be here in my very early days as the Chairman. So I am looking forward to seeing the presentation of both Dr. Zeidan giving the perspective for us and then you are presenting the update on the data that I know looks really exciting. So great to be here today.

Thank you, Tuomo. Yes, indeed. So we can -- maybe if where we head in, I would just like to kind of share my thinking when coming to this -- when I actually stepped on a medical career, I never thought I would be here with the leading KOL in MDS, a figure like Tuomo Patsi, who actually launched azacitidine back in the day, which is such a cornerstone for the treatment of MDS. I think one could even call it an establishment. So -- gives me great honor to be here with you today. So let's move on to the agenda and to see how we build up today. First, we're going to have Professor Zeidan present the management of MDS patients after HMA failure opportunities in that space. Then I'm going to present the latest results and then we're going to have a roundtable discussion with a Q&A about the results and giving further perspective to the program. And at the end, me and Tuomo are going to have a finished summary also about today's items. But please let's go ahead, and the floor is yours professor, Zeidan.

Yes. Thank you so much again for the kind of opportunity. So my presentation today will focus on the management of patients with high-risk MDS, in particular, after HMA failure setting. Next slide, please. So these are my disclosures, including consulting for Faron. I think I'd like to make like a few points that are very kind of important when you think about higher risk MDS. So the first one is that hypomethylating agents, as you just heard, especially azacitidine are the standard of care and the management of MDS. The landmark study, you can see to the left was the first study ever to show an improved overall survival in high-risk MDS patients where azacitidine had a survival of 24 months compared to conventional care regimens of 15 months. And because of this, azacitidine has become the standard of care agent. However, there are other hypomethylating agents such as decitabine, which have been approved in the U.S. and other countries for the management of patients of high-risk MDS in the frontline setting, although they have not been associated with an overall survival advantage as you can see to the figure. But there were improvement in responses, there are improvement in quality of life and transfusion independence. Next, please. However, there are several problems despite this being a major advancement to have these hypomethylating agents in the frontline treatment, we have realized a few things about HMAs as we start to use them in the clinic. The first thing is that while -- you saw that -- that overall survival was 24 months in that landmark is a 001 study. Most of the subsequent analysis that looked at the use of azacitidine in real-life setting has shown the overall survival to be actually lower so it ranges somewhere between 11 to 18 months instead of the 24 months that we saw in the clinical trial. And I think that speaks to a couple of things. One of them is that I think some of the use of the hypomethylating agents in the real-life setting is not as good as it was done in the clinical study. Those drugs are slow to act. They generally need 4 to 6 months to actually exhibit their full activity. And importantly, they have to be given by injection, the patient has to come to the clinic. Many of those older patients might not necessarily do that continuously to come 7 days in a row to get the injection. So I think there are multiple reasons why we are not seeing as good of our result in terms of -- using those hypomethylating agents in real-life analysis. Next, please. And even more important is that even when patients respond to hypomethylating agents, all patients at 1 point will stop responding. And that varies between 12 to 18 months. There are some patients who could go for years, but this is the exception. Most patients will not stay in responding more than 24 months. And as I mentioned in the beginning, around half of the patients don't respond to begin with. This is what we call primary failure when they don't respond at all and secondary failure when they initially respond but then stop responding. What is shared is that once patients stop responding all together, that the median survival is quite dismal. You can see here 2 large analysis that have shown that the median OS in patients after failure of hypomethylating agents is around 4 to 6 months. So it's very limited survival. And clearly, this is the most significant unmet clinical need in patients with MDS. This is an area where there has been a lot of interest to introduce drugs because patients generally will have a lot of complications from low blood counts, bleeding infection, et cetera. And as you can see here, their survival is very short. So there has been a lot of interest in getting drugs in this space. Next, please. The development of drugs in the setting of HMA failure has been generally a very challenging situation for a number of reasons. One of them is that some of the strategies that relied on targeted treatments have been very challenging because MDS compared to some other cancers there isn't like one single alteration. Like when you think about CML, for example, you have BCR-ABL translocation. All the patients have that you can target with a tyrosine kinase inhibitor. And MDS, as you can see to the graph to the left lower hand, there's a large number of alterations that happen in -- across the patients. Most of those alterations will not happen in more than 10% of patients. So to try to come with one targeted treatment is very challenging because there are many different driving forces that are different between patients. And thinking about what we call mutation-agnostic strategies or strategies that would work across the spectrum, for example, including immunotherapy type of treatments would be important because it hopefully would work across the spectrum. However, some of the other challenges that we have seen is that MDS is a relatively rare. And those patients generally don't do well after a HMA failure. So some of them are not going to be able to go on clinical trials. And we don't fully understand how HMA failure actually works in a mechanistic level. So because of all of those reasons, we have not yet been able to get any drug approved after HMA failure except one drug to you about in a little bit, which is the IDH1 inhibitor. This is approved in the U.S. ivosidenib, but this is only approved for around 3% [Audio Gap] and most of the patients consistently. Next, please. So how do I manage patients in the clinic? I have to say that this is a figure I think we put, I think, at least 6 or 7 years ago, but this has not really changed much outside of the addition of the IDH1 inhibitor, ivosidenib, in the 3% or so of patients who have IDH1 mutation. We still have a lot of like therapies that we have been trying, but they have not yet been successful. So the standard approach currently continues to be clinical trials, whenever possible, bone marrow transplant, if you are able to get the patient to a transplant. But this again highlights that this is an area of a significant unmet clinical need where a new drug is eagerly awaited. Next, please. And this is a slide that was published almost 10 years ago now in a paper from JCO that showed that patients who -- as I mentioned in the beginning, they have poor survival after HMA failure. But when you look at the different subsequent treatments, of course, the ones who went to allo transplant, allogeneic transplant did the best. But this is a small number of patients. Here, you can see 37 out of 165, but this is by the fact that many of those patients came to the big centers. But the patients who go on to investigational treatments to the best. Again, highlighting that the current drugs that we give to patients outside of transplant or clinical trials have not been effective dose -- low-dose chemo intensive chemo. Next, please. So this is some examples about what we currently do in the clinic in the absence of a clinical trial. You could give intensive chemo. So this is an example of a retrospective analysis in which intensive chemo was given to patients. And what you can here -- see readily is that some patients did respond, but the median survival, again, here was 10 months only but this is a highly selected patient population who were able to tolerate intensive chemo. And I would remind you that most MDS patients are in their late 60s, early 70s. They have a number of comorbidities and they are not able to tolerate intensive chemo. So this really applies to a small number of patients. And generally, it's not going to be used unless there's a transplant option for the patients. So it's as a bridge for transplant, not as a continued therapy. Next, please. Another approach that has been used in the clinic is the combination of low dose clofarabine and cytarabine. This is a work by the MD Anderson group, again, showing that in those patients, which are highly selected from, again, patients who go to big centers such as MD Anderson, generally tend to be highly selected group of patients. Here, you can see that CR rate was around 20%. Some of those patients were able to proceed to transplant, and some of them responded. But overall, the survival continues to be [ decimal ], especially on those who have complex karyotype. Next, please. Now as I mentioned, there has been a number of drugs that have undergone clinical testing and initially had some interesting data. One of them is this drug Rigosertib, which is a multi-kinase inhibitor. This is a randomized Phase III trial called the ONTIME that looked at this drug compared to the supportive care. And this trial actually was negative, as you can see in the survival curves to the right. In this study, the median survival, as you can see, again, was only around 8 months with the drug compared to 6 months in the real life analysis. Why is that -- sorry, in the control arm. Although the study was negative, but it was important because it confirmed that the survival rate, the control arm was only 6 months, again, confirming that HMA failure setting still very poor outcomes in terms of what we currently do. Based on this study, actually, some patients were identified who potentially could benefit those who have IPSS-R very high risk and those who had primary HMA failure. And next slide. So based on this, actually, a subsequent trial was done looking at this specific subset of patients. But again, this trial was negative. You can see here the press release from this subsequent study called the INSPIRE, which I don't think has been published, although this press release was several years ago. And the median survival, as you can see, was 6 months. Again, I think highlighting that this -- in this particular subset of patients, it has been very tough to improve the overall survival. Next, please. And this is the latest Phase III trial to fail. This is a second-generation Guadecitabine. As you heard azacitidine and decitabine both of them, our first-generation HMAs hypomethylating agents that are currently used in the U.S. Guadecitabine is a second-generation hypomethylating agent that was again, shown in early phase data to have some better outcomes and some activity after HMA failure. In this study, Guadecitabine -- patients after HMA failure were randomized to receive Guadecitabine as you can see here versus pretty selected treatment choice, which whatever was chosen by the physician, including intensive chemotherapy or other supportive care, et cetera. And you can see, again, the complete overlap in the overall survival curves, 9 months versus 8 months. But again, I think the take-home message in my mind that the overall survival after HMA failure is somewhere between 4 to 8 months. This is something that we have consistently seen across all studies after HMA failure. Next, please. Now one drug, I think, that has some activity is venetoclax. Some of you might be aware that venetoclax is already approved in multiple in the U.S., and I believe in -- out of the countries in Europe in the front-line setting in older unfit patients with acute myeloid leukemia in combination with hypomethylating agents or with low-dose cytarabine. And this was based on a randomized Phase III trial. So it has been naturally explored in high-risk MDS, which is clearly related to acute myeloid leukemia. And here, this is our own study using venetoclax in the HMA failure setting. So this is a study that we conducted in 44 patients multi-center study in which we added venetoclax to azacitidine at the time of HMA failure. And you can see the baseline characteristics of this patient population is very representative of what you expect high blast count, older patient population, high-risk disease, and the transfusion dependency. Next, please. And here, you can see that we saw around 39% responses. Most of those were marrow CRs, only 7% were complete remission. And in this study, the durability of the response, as you can see, was around 8 months. Next, please. And we have seen that there was activity across some mutation and spectrum. Patients with TP53, as we know, generally don't do very well with all of those treatments, including venetoclax. So you can see the response rate was the lowest. But we also have seen transfusion independence for platelets and blood for patients who are transfusion independence at baseline, around 1/3 of patients achieved transfusion independence. Next, please. So I think based on the venetoclax data, it certainly seems encouraging in the refractory setting. However, the sponsor of -- or the manufacturer of venetoclax decided to focus on the frontline setting. So the registrational study called VERONA is actually currently ongoing in the frontline setting of Aza venetoclax versus the Aza alone. So the drug continues not to be approved in HMA failure setting, although it's used in occasion in the U.S. as in an off-label manner, especially as a way to bridge patients to transplant. And lastly, I want to mention the 2 drugs, which are the IDH inhibitors, which both of them are approved in the U.S. for patients who have IDH1 or IDH2 mutations after -- or the approval in the U.S. is currently in acute myeloid leukemia in patients who have those mutations as a second line or in the case of IDH1 mutation in the first line in combination with azacitidine. However, patients with MDS sometimes have these mutations, but they are very uncommon, as I mentioned in the beginning, IDH2 is around 5% to 7%. IDH1 is around 3%. So together, they are less than 10% of patients who have IDH mutations. If they do have it, it generally -- giving those inhibitors will work. So this is one example of a study where enasidenib, which is an IDH2 inhibitor was given, and there were responses including after HMA failure. Next slide, please. And here, the ivosidenib, this is the data that has led to the approval of ivosidenib in the HMA failure or after second line after -- azacitidine treatment patients with MDS who have the mutation. Again, remembering that this is only 3% of patients. This is an oral pill. This is a small study. So this is actually instructional in my mind because here, the approval by the FDA was based on 18 patients. Only 18 patients basically in this analysis have led to the approval for multiple reasons. One of them is that the drug was already approved in AML. The second reason is that the results were quite actually impressive in terms of the response rate and survival after HMA failure for this small subset of patients and transfusion independence. So based on this, FDA did approve this drug which certainly works. But again, the problem is that this is only 3% of MDS patients, so leaving many, many patients without any approved option after HMA failure. Next, please. And this is a related drug called Olutasidenib, which is another IDH1 inhibitor. This is not approved in MDS in the U.S. It's only approved in AML but it also has some activity in IDH-mutated MDS. Next, please. And lastly, I wanted to mention the intensive chemotherapy. I already mentioned that at the beginning here, I'm talking about a different drug called CPX-351 or liposomal daunorubicin-cytarabine. This drug can lead to responses, but this is an extremely highly selected patient population who can tolerate intensive chemo and can go to transplant, which generally is less than 10% to 15% of patients. So most patients will not fall into this category. Next, please. So I think there's a large number of drugs that are being studied in MDS. I have focused on immunotherapy targeting agents. And I think, generally, for multiple reasons, I think immunotherapies are probably some of the best drugs to be explored in this space. The first reason is that we know allogeneic bone marrow transplant is the most effective way to cure MDS and it's an immune intervention essentially. The second reason is that, as I mentioned in the beginning, immune activation is expected to work regardless of the genetic landscape, which allows you to target all the patients at the same time rather than doing strategies like IDH inhibition, which is very effective, but only applies to 3% to 5% of patients. And the third reason, which I think is very important is most of MDS patients, especially after HMA failure, they are older, they have comorbidities. They cannot tolerate many of those treatments I showed you. For example, I told you that venetoclax is very -- is effective in the HMA failure setting and reducing the blast, but it's also very myelosuppressive. It reduces the blood count significantly. Some of those older patients cannot tolerate it and they can develop infections, bleeding, et cetera. So having drugs after HMA failure that are not myelosuppressive that are easy to tolerate that don't -- the patient does not have to come every single day for them, I think, would be very important. And eventually, while this space has been very difficult to develop drugs in it still constitutes a very important opportunity because the unmet clinical need is so high that I think if there is a drug with a reasonable efficacy and safety profile in a good number of patients in a Phase II study that, I think, in my mind, could justify consideration for approval. And I am hopeful that we are going to see some drugs that fill this space in the near future. So thank you so much, and back to you, Juho.

Thank you so much. That was comprehensive well laid out what's really out there being tested and so forth. Still a big empty black hole, as you said, to fill. And maybe we can help in that. So let's move on to how we're looking in this respect. And before we go there, just to recapture what led us into this. So the Phase I part of the BEXMAB trial encompass frontline, high-risk, relapse refractory MDS and also relapsed/refractory MDS and also relapsed/refractory AML. And when the data started coming in, it looked exceptionally good for both MDS also activity in AML but a bit lower activity in AML, and I got a lot of questions, for example, well, doesn't it work in AML? Yes, it works. But how I see AML as a physician is it's -- they've received more therapies previously. Their immune systems are more tempered with chemos, et cetera, their blast counts are very high, so very hard to bring these patients back into remission and win the game at that point. While MDS, which can be considered a pre-state of AML, we are right on time still to intervene with the course of the disease, especially being an immunomodulating agent like Zeidan, just said, we hit the right spot there. And looking at the landscape that was out there when we were figuring our path forward, we had Aza plus Magro, Aza plus sabatolimab, Aza plus Ven going on in the frontline setting, while only the IDH inhibitors in the refractory setting and then AML is a relatively more competitive complex market. So why go there when it's hard to win the game? Frontline was filled with a lot of big trials at the time. Now a couple of them, unfortunately, came back negative. But here, refractory MDS, very high response rate when we kicked off very high unmet need and commercially a good opportunity. So that's why we expanded the Phase II in refractory MDS. Next slide, please. For the demographics for the relapsed/refractory MDS patients treated so far. What I want to highlight with this slide, just to show that, yes, these are high to very high-risk patients, these are pretty old mean age 74 again and also prior therapies. So usually, only 1 and that being an HMA, of course, so we get them pretty early. We can still play with the immune system. Those that have had 2 prior therapies or more usually actually come out of the existing frontline trials Aza Magro, Aza sabatolimab, Aza Ven . So we get patients that refracted on those and then responses in our trial, which is very encouraging to us. Then to the next slide. Again, as Professor Zeidan said, a well-tolerated drug would be very good, again, were an immunomodulating agents were not toxic per se. And currently, as the data set is building up for relapsed/refractory MDS and we can now start looking at it specifically, and the risk-benefit ratio, which ultimately, the regulators are going to look at how much risk does the drug bring? How much benefit does the drug bring. If you look at the safety profile now specifically in MDS, it looks exceptionally good compared to existing relatively toxic agents. But that's a small number of patients. So keep that in mind, but we do have plenty of exposure having investigated Bex in solid tumors before this. So we have a very good safety data base to show that it's still widely, rather well tolerated. Nothing really special comes up. We do see a degree of autoimmune adverse events, but usually, they are well managed, taking the patient after drug and giving them steroids if needed. So the safety profile looks very good at the moment. Next slide. Then to efficacy. So a lot of you have been following us. This is the classical swim lane plot. Each line is a patient. And there, we see the traditional median overall survival for this population, which, as mentioned, is around 6 months. And here, we show that we get a lot of these patients still in remission going far beyond this point. A couple of patients have moved to bone marrow transplant. So overall, at the moment, the objective response rate is 11 out of 14 then true remissions are 9 out of 14. The majority being MCRs as seen in this population a lot. But what is also very nice to see that now that we have more follow-up on the Phase I patients is that currently, the estimated, and this is an estimation at the time. So keep that in mind, this is subject to change, but it's 14 -- sorry, 13.4 months, which is indeed very good. So it's just very nice to see this data coming together and this survival benefit validating these durable remissions we were already seeing as the data builds up. Next slide, please. This is just kind of repeating what we previously saw. But again, we have a lot of journalists in the audience, are big retail followers, putting the current results we're seeing into context what Professor Zeidan just laid out. So comparing our trial results to what's currently out there. Not really much. Usually, they're all toxic stuff with very poor survival benefit, very hard to get patients into transplant, which is the possibility for actually a cure. There is bridging with Aza and Bex going on. That's nice to see that there's something. But then on the other hand, our current results, relatively high response rate, a lot of them being CR/MCR significant survival benefit at the moment and nice to see getting patients into transplant for a possibility of being actually cured. So to me as a physician, I liked when we kicked off the meeting today, this is spectacular to see -- just -- and let's hope this just continues and we can really bring something game changing to these patients. So next slide, please. Now we're going to move on to a Q&A and roundtable discussion on these results. We could if possible, for the tech, we can take the slides away for a moment, but other otherwise, they can stand there. First of all, just to warm up Professor Zeidan and Tuomo a couple of easy questions.

So Professor Zeidan -- what's your first immediate thoughts on the results we're looking at?

Yes. I think it's important to kind of remember a few things when you evaluate, I think, Phase I and Phase II studies. I think the first thing is like to make sure you can actually deliver the drug because as we discussed at the beginning, those patients with MDS who are refractory/relapsed are sick, they have comorbidities, they are old. Many times, they cannot even tolerate the drug. So when you are able to deliver the drug and deliver it in a way that is safe, well tolerated, it's an important thing. So it does seem, again, based on this initial data that safety profile, which has been studied very well, as you mentioned, in solid tumors, I think, is kind of very well understood in a much bigger sample size that the drug is well tolerated. We don't expect it to kind of [ work ] in cytopenias, which is a big problem, clearly in MDS patients, which is certainly important. We are not seeing a lot of these immune-related adverse events, which have been a problem with some of the other immune checkpoint inhibitors that we have worked with in other studies such as PD-1, PD-L1, CTLA-4, et cetera. So I think the safety profile is certainly very encouraging. When you think about the efficacy, it's -- like in my mind, I think one of the first thing to look at in those patients is the expected survival after. The responses are always very tricky, I think, in MDS in general. CRs, I think, certainly durable CRs, I think, are the most meaningful. With marrow CRs, ideally, you want to have some hematologic recovery so that you can have a sense that these are kind of meaningful responses. But for me, if you have a good overall survival, more than 12 months, that's generally encouraging. Of course, this is a relatively small sample size with limited follow-up. But in my mind, if this continues to hold up with additional patients and longer follow-up, I think this would be very encouraging. And certainly, I look forward to seeing more results kind of building up on this overall survival.

Yes. We too. Go ahead, Tuomo. I was going to ask the same question -- now your thoughts.

Yes. I think you covered really the key points about the profile of the drug, the good tolerability and promising efficacy signs so far. So obviously, the clinical value needs to be further validated. So that we see that people actually gain clinical benefits so that they live longer and they live better lives. So that's the intent. And if we have such a profile that helps patients and it's also convincing for investigators, clinicians, there obviously is a commercial opportunity, which kind of will follow from the patients gaining the benefit.

Going forward, kind of continuing with this -- coming a question from the audience. So what does a response mean to a patient and the patient's well-being exactly because we talk about CRs, MCRs, hematological improvements. Can you shed some light what's meaningful for a patient Dr. Zeidan?

Yes. I think the most convincing response in general in refractory/relapsed MDS is what we call durable CRs. Now this is -- I can't get like quite technical because we actually have revised the response criteria in 2023 to kind of dissect more into the responses. So to get to a complete response in MDS, you have to achieve a hemoglobin of 11, in addition to full platelet and neutrophil recovery. Now getting to a hemoglobin of 11, in addition to full platelet and neutrophil recovery. Now getting the hemoglobin of 11 can be quite challenging in many MDS studies. But we know some degree of hematologic recovery in addition to the reduction in the blast is important. So we actually have been talking about introducing responses called CR by lineage and unilineage, which means that you have some count recovery. I think marrow CR without count recovery at all is probably not very meaningful, but CR, PR, and marrow CR with hematologic recovery, those in my mind are the kind of the responses that carry more clinical benefit. Now you want them to be durable, right. If the response duration is very short, that's also one issue. So if you have a lot of those responses and you have a drug that is well tolerated and patients can stay on. Generally, the expectation is this will translate into longer survival. But of course, again, you need to have a bigger sample size because there is certainly some statistical variation when you are only looking at a limited number of patients.

So with this in mind and talking about -- actually, you mentioned its sample size. So let's say that as we go on and the data set builds and the results, we're seeing now maintain that -- this is the level and it continues on. Questions from the audience. So what is needed for approval, accelerated or full?

Yes. I mean that's a very tricky question, right, because it depends on how the kind of the regulators kind of think about this. My sense is few things to consider. One is in the refractory/relapsed setting as we have discussed several times now, it's a very difficult space, no approved drugs outside of an IDH1 inhibitor that only works in -- or is only available for 3% to 5%. So usually, this is being considered significantly when there is no other alternative. So in my mind, if you have a sample size -- and again, that's my own kind of estimation. If you have a sample size of 40 patients and higher in which you have a durable complete response in a significant number of patients and the median OS that holds up that [ Sab ], I think that potentially could be considered. Of course, we know when you do accelerated approvals in general, you will need to have a subsequent confirmatory bigger sample kind of studies. But we -- just to take the example of the IDH1 inhibitor, again, it was approved based on a relatively small sample size, 18 patients, but the results were very outstanding in that patient population, very high CR rate, very durable survival. So I think these kind of results are probably not easy to replicate outside of the IDH-mutated space. But certainly, in my opinion, you can get an approval based on a single arm study as long as it's a good sample size and efficacy profile does hold up as well as the safety profile.