Kyntra Bio, Inc. (KYNB) Earnings Call Transcript & Summary

Relatively recently appointed CEO, Enrique Conterno, and other members of the FibroGen team. Hi, Peony. So welcome to GHC this year.

Thank you, Geoff.

Your first GHC, how is it going?

I think it's going awesome. We had a packed agenda today, met with a number of investors. Very good.

Good.

Yes. So let's jump right in. You mentioned a lot of questions about the launch in China. How's the launch in China going? Are you actually commercial at this point? Great news on the NRDL, but that was last year's news. So how are things going this year?

Well, the NRDL was an important achievement. It was last year's news, but it was effective as of January 1. We are very much tracking, I think, and we're very encouraged with what we're seeing when it comes to both hospital listings and demand on those hospital listings. Honestly, I'm pretty impressed with what the team has achieved. Of course, we also have the coronavirus right now in China, which has meant that it is difficult to, if not impossible, to access any hospitals, and clearly, that has a bit of an impact. Roxa has a bit of a unique position in China for a number of different reasons. But as an oral product, clearly, you really don't need to go to the hospital. So when it comes to, for example, PD patients and so forth, it represents an interesting alternative for patients that really don't want to go into the hospital at this point in time. So far, I think we are very pleased with what we're seeing despite the fact that we have the coronavirus.

Okay. And how is it actually working? I mean, I think your price was $2,100 or something like that and obviously equivalent in local currency. And how much of a discount are you required to take once you get the local or provincial reimbursement? And then could you talk about, in the initial demand, how patients are -- do they have significant out-of-pocket burden? Can you kind of cover that out-of-pocket burden?

Sure. So I think what we've shared is that the net price that we estimate would be, getting for a patient for a full year in China, is about $1,500. The out-of-pocket is going to be dependent on the different provinces and also whether it's a dialysis patient or an NDD patient. But I think it's -- we're still in the early stages. Keep in mind that provinces were given through Q1 to be able to implement the reimbursement system. But so far, I think we are pleased with the demand. But we have to -- it's very early, I think, in the stages of the launch for us to make too many assessments in terms of what is the exact out-of-pocket that patients are paying.

Okay. And are you finding that you're getting more traction in the dialysis patients or the nondialysis patients? Very much a very different context.

Yes. It's difficult to say at this stage. But clearly, dialysis is a pretty big focus for us, given that those patients are treated for anemia. So -- and there is a pretty big opportunity. So that's really where the initial focus and the uptick that we expect initially is going to be, keeping in mind that the NDD opportunity also in China is a very significant one from a [ patient's ] perspective.

Yes, it's obviously large. Now one of the questions that keeps coming up is the question of the ownership of the Chinese joint venture. Could you talk about the option of spinning that out or capitalizing that independently? How -- who makes the decision on that? How you might come to a decision about that?

Yes. Clearly, as we think about China, there are many options the company have. At this point in time, I'm not commenting on our -- the options that we have for our Chinese business. I think my focus, and appropriately so right now as we're launching the product, have to be ensuring that we are getting the fundamentals right and that we can build and create a very significant ongoing business. I think I want to make sure that there is the focus on the task at hand right now.

Okay. Now is there any intention, for example, to licensing complementary renal products or anything into that entity that you have there?

We're always open to think about those opportunities, but it's not a focus for us right now. I think our focus is, once again, to grow roxa to be the type of transformational medicine that it can be. It's a pretty unique opportunity to have this type of medicine, and China represents a very significant market. Keep in mind, it is the largest dialysis market in the world and we want to -- and we have achieved reimbursement across CKD anemia and a reasonable price. So we need to make sure that we capitalize in the hand that we have right now. We're always open to look at additional opportunity, in particular, complementary opportunity, but I think it's fair to say that, that is not the focus today.

Okay. Let's just pivot to talk about the U.S. market. Is your expectation that you will get essentially the same labeling and market opportunity in the U.S. as you've been given in China?

Yes. So clearly, in the U.S., we submitted our application at the end of last year. We've been -- our filing has been accepted, and we have a PDUFA date of December 20 of this year. We submitted for both, dialysis-dependent and nondialysis-dependent patients, patients with anemia. So we are planning to basically pursue both opportunities. Just to give a sense of the magnitude of the opportunity. As you know, in the U.S., there's about 600,000 patients on dialysis. About 90% of those patients are treated for anemia. That gives you about 5,500 patients -- sorry...

550,000.

550,000 patients that, in terms of patients, that is the addressable opportunity with roxadustat. If we think about NDD, the opportunity -- the addressable opportunity is about 10x as large. We're looking at an opportunity of about 5 million addressable patients. Keep in mind that the number of patients treated in this segment is basically in the low double digits. So you -- we are thinking about...

Sorry. As a percentage of that total treated for anemia?

Correct.

Okay. That's what I thought you said.

So we are looking at basically an opportunity, yes, patients that are treated, but also, I think it's going to be important here, the significant expansion opportunity to be able to reach more patients for -- and for those patients to be treated. Let's keep in mind that before EPO had some of the issues and they received a black box, the rate of treatment of anemia in this population was significantly higher, right?

Yes. How high did it get? From recollection, it was in the high 20s, something like that?

That is correct. I think the figures that I've seen is, when you look at the prior 12 months of going into dialysis, up to 30% of those patients used to be treated. That number today is closer to 14%.

And how many do you think are actually sufficiently anemic to qualify for the label that you expect to get?

Well, I think it's -- there are several questions there, a question on the label. But I do think that's the addressable population. So I'm giving you the number of the addressable population that we basically expect. It is not, to me, as much a matter of whether those patients need to be treated, but how do we ensure that we convey the right messages and the benefits of treating some of those patients. And maybe we can speak a little bit about that because there are significant benefits. Of course, when we look at -- and just to recap, we basically, for our U.S. submission, when it comes to NDD, we have, based on our agreement with the FDA, we have 3 pivotal trials: ANDES, ALPS and OLYMPUS. They comprise over 4,000 patients. And across all the studies, we reached our primary efficacy endpoint of raising hemoglobin. But I don't think the story ends there. I think it is interesting to see the effectiveness -- the efficacy of the product across a broad range of patients, all right, that today don't have as many options whether they are hyper-responders, or in some cases, maybe don't tolerate well EPO, or in some cases, they need much higher EPO doses over time. I think we have a product here with a very nice profile, and importantly, I think in NDD, we basically saw much less transfusions. So if I recall the numbers, it's 15% of transfusions for patients that were on placebo. We only saw about 5% for patients that were on roxadustat. To me, I think that is a significant benefit, a significant benefit to the patient, but also to the payer and to the system. And then, of course, there is this question of, well, how does the cardiovascular safety look like. As you're aware, I've had a chance to conduct and be part of a number of cardiovascular studies in my previous role, and I believe that the data that we have on cardiovascular safety is very compelling. We have agreed with the agency on both the post studies. So what are the studies that are going to be included as part of the analysis as well as the methodology that we will be utilizing for this particular segment we basically intend to treat, a statistical plan methodology. And when we look at the data, basically -- we basically show to be comparable to placebo. And importantly, when we look at the subcomponents of MACE, we had, of course, MI and stroke and death and...

Unstable angina.

Hospitalization for heart failure and hospitalization for unstable angina. We -- when we look at all those, in each -- for each one of the subcomponents, that confidence interval actually encompassed one which makes our data extremely clean in -- from a -- from my perspective when it comes to cardiovascular safety.

Enrique, sorry, can I just interrupt a moment. But from your prior experience, I think the FDA has pretty much said that up above the confidence interval of 1.3. And are you below that 1.3 for the subcomponents of MACE or just for overall MACE?

Yes. Keep in mind that the guidance that the FDA has provided is strictly for diabetes medicines, and the guidance for diabetes medicines is a 1.3 upper bound. So that means to -- we want to make sure -- the FDA wants make sure that products can exclude more than 30% risk of MACE events -- increased risk of MACE events. There is no such guidance for CKD anemia, which means that the FDA will have a -- this will become a product review issue when they look at the benefit/risk profile of the product. Now in the case of the diabetes products, just to go back, the FDA looks at MACE, so the 3 components. They don't look at the subcomponents when it comes to the upper bound because the numbers are a lot slower. So the confidence intervals tend to be a lot wider. Now in our trial, when we look at the pooled analysis of ANDES, ALPS and OLYMPUS, we do basically see hazard ratios, about one -- slightly higher than one, but the upper bound in each one of these cases, is below 1.3. I do want to make the point the 1.3 number is an arbitrary number, okay? It was arbitrary for diabetes, and it's just a number. So at the end, I think it's a question of looking at what are the options. Keep in mind that the option today for those patients in NDD is really the EPOs actually have a black box and actually had a demonstration of -- sorry, a further trial. When we look at the stroke data, actually stroke itself have a confidence interval to the right of one, so -- which is a statistically significant finding for higher stroke. So I...

For EPO?

For the erythropoietin, yes. So I find that our data, for all those reasons, is highly compelling. There are not many options, and we have a trial that, in my view, basically, shows safety against what I think is a very high hurdle of placebo. It will be different if maybe we were in this particular population using another comparator, but I do like, and this question also comes quite a bit, which is why did you choose a trial against placebo instead of a trial against EPO.