Kymera Therapeutics, Inc. (KYMR) Earnings Call Transcript & Summary

Okay, and welcome to the Wednesday afternoon session. It's Wednesday, right? Yes. My name is Chris Shibutani, a member of the research team, along with my associates. We are very excited to have Kymera join us this year for the 44th Annual Goldman Sachs Healthcare Conference. Here we have on the podium with me, Nello Mainolfi, Founder, President and CEO, lots of titles here. And then hidden off in the audience, Bruce Jacobs, the Chief Financial Officer. Bruce, we see you. You can only hide so long. The team that's out here, obviously, is coming at this meeting at an exciting time. There's folks. Jared, you're -- Gollob, you're their Chief Medical Officer, is very busy at some medical meetings because you guys have been super busy, a lot of progress points. We want to make sure that we talk about some of the data reveals and new information that we've had today. And I did also want to just make sure that we talked about sort of like the partnership communications because, especially at this event, there has been, I think, very helpful productive flow about all of these things. But maybe, Nello, just to start, get the transcript going off on the right page, give us a snapshot on Kymera.

Great. So first, Chris, thanks for inviting us.

Of course.

This is our first time actually at Goldman Sachs. Last year, we can't make it last minute. So honored to be on the stage with you.

Glad to see you.

So Kymera, just a quick -- very quick introduction. Kymera was built in 2016 to take the targeted protein degradation modality into a fully-integrated commercial stage company. We feel the responsibility to do this and to do this right. We feel it's important to make sure we select the right targets to go after with the technology. We want to make sure we make the right compounds to put into the clinic, and we'll discuss that in a few minutes, I'm sure, and that we develop the right development plans to make sure that patients have access to the molecules, access the right patients. And in the market, they access the right patient population. So we've focused for the first few years in oncology and immunology. We found that being disease-agnostic is where this company will go, but being focused early on is wait to build credibility for an early company. We are paranoid about target selection at Kymera as much as we're paranoid about clinical translation. So we believe that we want to work on targets where only protein degradation can unlock the biological and clinical value. We also believe strongly that protein degraders are small molecules, but are also different. They behave differently from small molecules. So they have to be developed as protein degraders. And so we have a talented, as you mentioned, Chief Medical Officer that has been focused on how do we translate these programs into the clinic, thinking about the right dosing paradigm, the right regimen, the right degradation profile. And so we now have 4 clinical programs. We have KT-474 that we're about to initiate Phase II with Sanofi. We believe that is a small molecule, broad anti-inflammatory drug that has brought potential. We have 3 Phase I oncology program: an IRAKIMiD program for MYD88 mutant tumors, STAT3 programs for liquid and solid tumor and an MDM2 program also for lipid and solid tumors that are reading data in the next few months. We're well capitalized as a company. We have more than $500 million that will allow us to get into the second half of '25 and, more importantly, will allow us to read, we believe, many of these data readouts going from 474 all the way to the earliest oncology clinical program. And we're excited about also continuing to innovate. We believe that when you stop to innovate, you're starting to die already as a company. And so novel E3 ligases to do selective degradation. Our molecular grew to go after unligandable targets. Novel programs in small molecule immunology, which is where the future of immunology will be where protein degradation is best suited for. So that's an exciting time for Kymera. So I'll pause here, and we can go through any of these.

And I think for investors, the whole notion of targeted protein degradation, TPD as we often refer to the acronym there, if you've seen one company, you've probably seen one company. While the genus is the same, there's proprietary capabilities. And as you can be disease- and therapeutic area-agnostic, that is also true. And so it really represents a whole pathway towards addressing therapeutically many different targets that just to this point haven't been drugged before. So the opportunity set is quite expensive. What is proprietary to you guys is your discovery platform, Pegasus. Just tell us a little bit about what makes that an element of Kymera's special sauce because you said your paranoid without target selection. Pegasus plays a role in tandem with all of that thinking.

Yes, yes. So I will start with -- we think about drugs as the endgame of everything we do. So we are fortunate, I think, to be in this place and time where we can use a novel modality to develop novel drugs. And you're -- I always say you're only as good as the target that you choose. But at the end of the day, you're also as good as the drugs that you make. And so our platform is really focused on building the best drugs for the most difficult targets within validated pathways. So part of our secret sauce, let's say, again, how we select targets and the type of criteria that we use, how we identify ligands these difficult-to-drug proteins. We're the first company that developed the transcription factor degraders against STAT3. We have others in our preclinical pipeline that we will disclose soon. Our platform also enables us to use high-content technologies to understand patient selection, and our platform allows us to identify novel E3 ligases that we believe can unlock a whole new generation of targets. Right now, the targets we have in the clinic for are targets that can be degraded broadly. What novel E3 ligases that have different expression will allow us to do is to degrade targets that where it's necessary to spare particular tissues. For example, there are programs where we might want to spare neutrophils. There are programs where we might want to spare cardiomyocytes because on-target activity of that particular target will give unwanted pharmacology while those targets have profound activity in antitumor context. And so we spend a lot of time and, I would say, money to identify expression profiles of these E3 ligases together with Max Planck Institute in Germany. And then we spend a lot of time and money to try and identify our ligands to those E3 ligases. And we're fortunate enough that we have several programs now after, to be honest, years of investments that can be directed in a sparing manner to tissues. And so I think now we talk a lot about ADCs in the space. It's like it's the new, hot thing. And what is an ADC? It's a drug that is trying to select a particular set population and spare others and increase therapeutic index. I think that using tissue restricted or sparing E3 ligase is it's actually an elegant and more targeted version of being selective for the tissues that you want to go after. The other aspect of our platform that is more recent is using molecular glues to degrade targets that are technically unligandable. So disordered proteins, disordered non-ligandable transcription factors, those are ones where you cannot find a specific binding event with the heterobifunctional molecules, but you can find the protein-protein-enabled molecular glue degrader. And we've been fortunate to identify a completely novel degron that allows us to target many new targets, especially in immunology with that particular technology. So we'll be talking about that hopefully soon enough.

Yes, absolutely. Let's keep to the most recent things and those that are actually very much in your control, the wholly-owned opportunities, oncology directed 2 assets, KT-333, STAT3; KT-413, IRAKIMiD. We'll spend a fair amount of time talking about this. If you had to think more broadly, just before we go into some of the details there about protein degradation, and you've made reference to some of these elements versus other modalities for oncology indications, what becomes your view of why there could be a particular advantage to taking this approach over sort of existing modalities?

Yes. That's a great question, Chris. So let's talk about STAT3 for a second. So STAT3 transcription factor in the JAK-STAT pathway, one of probably the most validated pathway out there. There are, I believe, 25,000 publications on the role of STAT3. And if you believe them all, all you need to drug STAT3, and you solved all diseases of human kind. Obviously, what is meant -- what I meant to say by that is that it's been studied, extensively studied in many context, in oncology, in liquid and solid tumors, in immunology and fibrosis and in many other areas. So it's clearly one of the most interesting transcription, or I would say, protein out there that has escaped any real drug discovery effort for a simple reason. It's a transcription factor that is difficult, if not impossible, to drug with a small molecule selectively. It is in the cell, so impossible to drug with an antibody. It is a transcription factor that is broadly distributed, so difficult to drug with an oligo-based therapeutics that's so far have been limited with particular tissues. So for that reason, for 20 years, it's not been drugged or drugged selectively or fully. And so when we started the company, IRAK4 and STAT3 were the first 2 programs that we went after because they represented 2 key principles of protein degraders, targeting a protein that has multiple functions that the only way to address, you have to degrade it or knock it down. And STAT3, which is a transcription factor that cannot be addressed with other technologies, you can bind to STAT3 and you can degrade it, but you cannot inhibit it. So that's where we believe is the value of this technology. And STAT3 data that we shared today, it's -- for me especially, it's so exciting because it continues to prove why this is such a great target for protein degradation.

Yes. Okay. Let's talk about KT-333 and just tell us a little bit about sort of the compound there and, in particular, how it's administered to patients, and then we'll talk about the various unveiling of datasets. There were some abstracts, the ICML meeting. But first, identify the compound for us.

Yes. So again, opportunity broadly in many disease indications. So this is a pipeline in a target. For oncology, we identified preclinically tumor types that were very sensitive to the presence of STAT3, so much so that as soon as you remove STAT3 at roughly 90%, you would see a rapid commitment to apoptosis. And cells will die, and tumors will melt in these preclinical models very, very quickly with infrequent dosing. We actually realized that you only needed to degrade STAT3 for about 48 hours at that 90% in order to drive strong antitumor responses, and so that's how the program was developed. We went into the clinic in the summer of '22 with a goal in Phase I dose escalation to obviously demonstrate PK/PD safety, identify an MTD and ideally being able to demonstrate that we can reach these 90% degradation with a good safety profile and also ideally identify in the patient population that we were dosing patients that were sensitive to these particular mechanism in terms of ability to demonstrate antitumor effect.

And we've often talked about how this is a year of revealing more of the clinical profile. And in particular, today at the ICML meeting, we had a larger denominator of patients. I think we went from 8 that was available in the abstract. The cutoff now takes us to, I believe, the start of May, and then we get a larger denominator of 13 patients. Maybe you could recap the announcement that you made and the data that was presented at that meeting.

Yes. For 333, we presented -- actually, the poster is presented on Friday, I believe, but it was up in the room today, so we obviously disclosed it today. Exciting data. First, I want to say that for both 413 and 333, both programs, we shared updated data today. And now I can say that for 3 programs, for all the 3 programs that we brought in to the clinic, KT-474, KT-333 and KT-413, we've been able to demonstrate that our drugs behave in the way that they were designed preclinically, both in terms of how they're dosed, how they degrade the target, the PK to the head and the safety that they bring with them. And while we may take a lot of that for granted, for a new modality and for people like us that work at the front edge of that modality, we don't take this lightly. And so we're very excited about having been able to demonstrate that for 3 programs across many indications and disease types. So what we shared with KT-333 today, as you said, 13 patients' worth of data. We've shown -- in terms of PD dose level 1, 2 and 3, we had showed dose level 1 in December. And now we've shown that basically with dose escalation, we are nearing the 90% number that we believe is important to drive antitumor responses. We have seen really been on safety, and we're very encouraged that now as we're approaching -- at or approaching clinically active doses, we can start to really focus on antitumor responses. This is something we decided not to discuss today. As you see, we've recruited to the study both liquid tumor and solid tumor patients. We've shown preclinically that T-cell lymphomas are those patients that preclinically respond very, very well to single-agent activity. So we expect to see single-agent activity from those patients, but we obviously recruit more broadly to the study to evaluate safety as well as PK/PD. And so for today was really demonstrating that we're close to or at clinically -- what we expect to be clinically active doses based on the degradation profile and that safety continues to be really encouraging for this program.

And I would say it's fair to characterize that you're seeing nice dose response curve with the dose levels you're showing so far, the DL2 and 3. Data also seems to suggest that you're getting increased levels of degradation as patients remain on treatment for longer, particularly as you move into later cycles. Talk to us about those kinds of parameters, which thus far actually are going in the right direction and quite promising.

Yes, I think it's obviously great that we see dose-dependent degradation. I think it's important that, that degradation is supported by dose-dependent increase in exposure by the PK so that PK and PD are correlated. Another aspect that is worth highlighting that was in the poster, and it's also in our corporate deck on our website, that we also measured pathway biomarkers. So not only we're showing that we engage the target and we degrade it, but we're also showing that downstream biomarkers are modulated. So in vivo, in patients, we actually were able to show reduction of CRP, for example, in circulating C-reactive protein. And also in genes in transcriptomics, we were able to see reduction in SOX3, which is a gene downstream of STAT3 at levels, again, in a dose-responsive manner and levels that are comparable to the degradation profile. And that's important not only for the development program of 333 in oncology. But as you know, we are expanding the oncology -- the STAT3 program also outside of oncology. And the data that we've shared today, it's actually quite meaningful. Very few drugs are able to show this level of reduction of systemic inflammation biomarker as this drug has with even a 50%, 60% degradation as the initial doses. So it's very exciting data, again, confirming that the drug is doing what it's supposed to do, which is really the key aspect of our update today.

And then the specifics of the regimen, this is stuff you're learning now that's for the purpose of some of this fundamental work here. Talk to us about how you might be contemplating either a weekly-dosing regimen versus perhaps every 3 days or something twice a week.

Yes. So what we've seen preclinically, as I mentioned earlier, that what's necessary and sufficient is about 48 hours of 90% -- roughly 90% degradation of STAT3 to drive profound antitumor response. And so what we wanted to demonstrate -- and then you can actually see the target recover so much so that actually preclinically, both once every week and also once every 2 weeks was sufficient to drive strong antitumor effect. We went into the clinic with once every week to actually be, I would say, more conservative, giving the drug more opportunity to be active. We also know that full degradation of STAT3 and 90% 24/7 is not really well tolerated, so we need to see some target recovery. Usually, we see some GI effect if we have target knockdown constantly. And so that's why that pulsatile dosing is sufficient to drive antitumor activity and also well tolerated, both preclinically and now also clinically. In fact, I think something that I want to point out, which we're learning in the clinic, we're seeing really strong target knockdown for 5 of the 7 days. In fact, it's only really in the last 2 days that you see target recovery, which is a really important point for both activity and safety. So we're seeing that the drug is quite active at degrading STAT3 for a prolonged period of time but also well tolerated, which is really great for both our oncology program and also programs outside of oncology.

Yes. I think one of the common themes typically with the clinical development of all of your assets has been this notion that the adverse event profile is quite benign. Obviously, we're doing different dosage levels. Do you think that we're at certain levels, would we be anticipating to be more mindful of that perhaps as we get into higher levels of dosage you're seeing on the efficacy, the kind of kinetics and response that you're looking for? In particular, I guess there was -- if you could just touch briefly on why one of the principal investigators did consider a squamous cell carcinoma of the skin in the CTCL patient was considered treatment-related. So help us understand how we could interpret that observation.

Yes, sure. I mean, first, obviously, that's not something that we have seen in the extensive studies that we've done. That particular patient is -- so obviously, has had this disease for many years, a few years ago was treated with UV light for the skin manifestation of the disease. UV light does tend to actually cause carcinoma of the skin. And in fact, this patient for years before being on treatment has had carcinoma that were treated. And they would come in -- they would come and then obviously be treated, and then they will reappear again. It just happened that while the patient was on the study, this carcinoma reappeared. And obviously, they were treated. The investigators, because they happen while the patient was on study, thought that you would define that as possibly related. Actually, that's how they were categorized, possibly related because they could not be fully ruled in or out, they were due to the patient being on treatment. But because of the long history of this particular patient, we don't look at this particular event as something that we're overly concerned about.

And as we think about continued progress, more work to come here, enrolling more patients advancing towards. Is it reasonable for us to contemplate dose level 4 and 5? And then in particular, when we think about the patient mix, I believe thus far, there's been 2 patients with CTCL, one with PTCL. So help us have some perspective in terms of where we are in terms of thinking about the total scope of the patient.

Yes, yes. Obviously, you've seen -- yes, we had actually one CTCL patient on dose level 1, one on dose level 2, one PTCL patient on dose level 1 and then mostly have been solid tumors. This study is open to liquid and solid tumors. Obviously, our investigators know what are the -- preclinically, the indications and tumor types that are very sensitive to single-agent activity. And as we've said, these are the CTCL, the PTCL, the LGL leukemia. And so as we are now nearing or at clinically-active doses, I would expect that the investigators will prioritize those type of tumor types because we believe that is where patients will have higher probability of responses. And so it will be good for, obviously, patients as well as for us to evaluate the antitumor activity.

Okay. Terrific. That's very helpful. We're obviously data junkies, always hungry for more updates. What should we expect in terms of the next time point? I know it was just today, and the poster is up and the real presentation is tomorrow, but we're already looking ahead what's a reasonable timing framework and for the next installment of learning about 333.

I mean we -- the cutoff date, which was early May, we have shown dose level 1 and 3 data. So we -- you can imagine that we've continued to recruit on the study, and the focus is also on patients that hopefully we expect to see antitumor activity. So the next update will be in the second half of the year, probably towards the back end of it and where we'd be able to tell the more comprehensive story, obviously, the full story on PK/PD and safety. But in this time, we will also be discussing the evaluation of antitumor activity. What I would say is that the fact that we haven't discussed it today does not mean that we have not seen antitumor activity. We decided to leave that conversation for a broader dataset.

Okay. Great. Let's go on to KT-413, IRAKIMiD. Just give us a snapshot of where we are with that asset.

Yes. So 413, we had an abstract that published on the 9th also at ICML. We did not have a poster, but we decided to update it today also on a press release and also on our corporate deck on our website. So I encourage people to look it up. On that particular program, we're also DL4. And we've shown now that dose level 3 and 4, we have reached levels of degradation that, we believe based on preclinical data, we should expect antitumor activity in MYD88 mutant patients. If you looked at what we've shown, so we've shown 50% to 70% IRAK4 degradation dose level 3 and 4 and 90% plus for Ikaros and Aiolos, and that's the profile that we've seen to be extremely active in MYD88 mutant lymphoma. We have dosed MYD88 wild-type patients in dose level 1, 2 and 3, and actually 1 patient on dose level 4 was MYD88 mutant. So it's actually a good time to start recruiting those patients. And also for this program, we expect that we'll try and focus as much as possible on recruiting those patients. At least, investigators know that we're at that particular key inflection point. And we plan to also the second -- the next update in the second half of the year to be focused on the totality of the data, including antitumor activity.

And how is patient enrollment going as, obviously, the identification of patients with the MYD88 mutation? Right now, our current denominator looks roughly about what and where could it be perhaps towards the end of this year.

Yes. I mean it's tough for us to guide. So I would say for KT-413, we had 1 plus 1. So we had one patient for the first 3 doses. And then on dose level 4, we started 3 plus 3. So now the denominator, I believe, is 5. So we had 5 patients through dose level 1 through 4. We -- now we would be dosing, as I said, 3 patients per cohort. So we expect to have many more patients than we have now at the next update. But it's hard for me to guide on the number because, obviously, I don't control patient recruitment.

Okay. And then the one patient who did have the MYD88, are you able to share with us and disclose what dose level that was.

Dose level 4.

Okay. Terrific. Safety profile, adverse events, how to think about that, when we would expect to see?

Yes. I mean also the first dose-limiting toxicity that we saw in our GLP tox with neutropenia, as you expect from the IMiD biology, that is a biomarker of engaging the IMiD substrates. We have done a lot of work in nonhuman primates to identify the degradation profile, the dosing paradigm that would minimize neutropenia and optimize clinical activity. We're happy to report that we had no DLT, and we had no neutropenia in any subject on our study. It was deemed to be drug-related. We -- and generally, the drug was well tolerated. As you've seen, we've reported the most relevant data on our corporate deck.

And then the usual Wall Street question, when can we learn more? And also I think Phase Ib has yet kicked off. Give us a sense of some time lines up here.

Yes, I would say for both programs, we are planning to have the next update in the second half of the year. Again, I would say for both programs in the back end of it in a medical meeting, where we'll try and hopefully be able to kind of talk about the Phase Ia study and then kick off the Phase Ib early next year and, hopefully, recruit the expansion cohort quickly.

Okay. So we're going to see if we can avoid having Bruce make December 14 an annual Kymera and sort of like keep the stress levels high as we head into the holidays. I guess maybe every other year, we could do that.

Yes. We will try actually not to do that.

Okay. Speaking of stress levels, I've been running around, actually fortunate to be able to talk to the whole spectrum of biopharma companies. Sanofi today was one of our folks. Clearly, a very important partner. And the commentary that Bill Sibold, who's of that division there, reciprocated in terms of talking about the importance of the partnership here. I think there was genuine enthusiasm as he described KT-474 IRAK4 degrader. The announcement that was made that you were able to share with everybody at the end of last year was their intent to take programs into Phase 2. Important for me to clarify, both of the transcript and those in this audience today. Bill, apologize after stepping off the dice that he had said, "Yes, we're going into both of these programs next year." But actually, I think it's been clear and consistent in their actual communications, and IR was very quick to recognize this, that the HS study is on a time line to begin during this year, and the AD is a program that they're enthusiastic as well. Just a little bit in terms of 474.

First, thanks, Chris. I actually had some time to look at the transcript. So obviously, we reciprocate the excitement. First, I will say Sanofi has been a great partner for Kymera. We've had a few partners along the way, so we understand how collaborations work. And they've been collaborative, open and enthusiastic about this drug. We are both super excited about the prospect. The Phase I data that we released at the end of 2022 was exciting, above and beyond our expectations. And so we and Sanofi have done our best to accelerate the development of this drug. We are excited to start the HS study in 2023, as you just said, that Bill had meant. We're also happy to say that the second study will probably start quickly thereafter. I can't really guide an exact time, but I think what Bill said that both studies will be active in '24 was a fair comment. But more importantly, we're very excited about what this drug can do for patients with inflammatory diseases. I think in many of these diseases that we're planning to go in, obviously, HS and AD, we've decided that will be the first 2, but we're thinking about what's beyond. And these are all diseases that lack a small molecule oral drug with a good safety profile. So the opportunity here is vast. And the biology of IRAK4 is broad anti-inflammatory drug that has a pre-athropic mechanism impacting plethora of cytokines and chemokines. So we're all very excited about being able to generate Phase II data SAT.

Yes. And exactly the scope of the opportunity, the sheer numbers of patients, obviously, Dupixent is the golden goose for them there, just a dominant presence and expanding across multiple different indications. If you could just help us with your point of view on potentially where it could fit. Now HS and AD are very different types of diseases in terms of, one, being a little bit more niche. Just set the stage for us where would you contemplate where 474 could fit.

Yes. So first, I would say that this is going to be my commentary. It's not going to be Sanofi's commentary.

They have their strategy in there, underlying motivations as well.

Yes. So I would say -- so first of all, HS is a growing disease and not because the disease is growing, but I think our ability to help patients with HS is actually bringing more patients to be diagnosed with HS. It almost reminds me of the early psoriasis day and the early AD days. And again, I will give also a credit to Sanofi for actually having a drug that has brought AD to the front stage because there was a drug that was active in that disease. I think IRAK4 for the type of mechanism that it has, has broad potential in Th1 inflammation, Th1, Th17. So HS, RA, obviously, we expect to be active there. Again, these are -- I'm not saying that's where we're going, but this is where the drug could go. So HS, as I mentioned, RA, IBD, lupus, these are all indications in Th1, Th17, where there is a biological overlap, there is a clear unmet need and there is a clear commercial opportunity. In Th2, where we've shown already early data in AD, you can imagine asthma, COPD are other indications where a drug like KT-474 could be active in. So I think actually, the teams in the collaboration are discussing what the next step would look like, but I think it's premature for us and for me to comment for the collaboration. I would just say, personally, obviously, and we built this program because of the breadth of opportunity. And obviously, we didn't build the program just for HS and AD, although those would be amazing opportunities already.

Yes. No, I think a smart decision. Clearly, a blue-chip dominant partner in that with all the insights that's available. We're past our time here, but I'll just close to make sure the capable stewardship of Bruce as the CFO, remind us what the balance sheet and what you feel your financing support gives you run rate through. Is there anything on the numbers?

Yes. I mean as I said earlier, we have about $516 million as of March that will allow us to get into the second half of '25, will allow us to read many of these studies that we're talking about, 474, 333, 413, 253, the MDM2 programs that we didn't get the chance to discuss this time. And we expect to bring at least another 3 to 4 programs in the clinic in that runway. So it will be a different company by then.

Yes, absolutely, and we look forward to that. The definition of platforms is that flywheel effect, generating additional assets. I wanted to leave more for additional conversations, and so we'll look forward to all the clinical progress. Nello, thank you for joining us.

Thank you, Chris.