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

Well, good morning, everyone, and welcome to another great session here on the last day of our 2021 Jefferies Virtual Global Health Care Conference. We've had a great week, obviously, this week. And one of the teams, I'm obviously looking forward to meeting with here today is FibroGen. We have the CEO, Enrique Conterno, here with us. And obviously, a lot going on at the company and obviously, gearing up for some important decisions and important events this year. I would just love to start off, Enrique. Maybe you could give some opening comments about where FibroGen stands today with roxa, obviously, both the U.S. and the European developments kind of going on simultaneously. And that would be great as you prepare, obviously, for an AdCom and a whole lot of different scenarios. So that would be great, to turn it over to you.

Thank you, Michael, and great to be here, be able to chat with you once again. We continue to be enthusiastic and excited about the opportunity of roxadustat to be able to reach patients around the world. Let me cover briefly how I see the different regulatory discussions and then I'll move into also China and the -- basically we're commercializing, which I know is of interest as well. When it comes to the U.S., we do have an AdCom coming very soon, July 15. We -- maybe my level of enthusiasm is because of -- also of our preparation. We feel very good about our preparation and how diligent we've been, and we look forward to basically having a really good discussion about the benefit/risk profile of roxadustat, which is really the intent of all of these AdComs. I expect this will be done for each one of the indications that we're pursuing in DD and NDD. Keep in mind, I think what -- and I think it's important that I highlight that roxadustat has shown comparability when it comes to both placebo in NDD and relative to EPO in DD. And while we are -- when we look at the hazard ratio of -- in incident dialysis, well, it is not below -- while the upper bound is not below 1, the hazard ratio, the estimate is still below 1, and it looks very, very positive. We can comment more way, this is important. And I think it's a reason for us for our success in China as well. Clearly, Europe is also coming quickly. Astellas is the sponsor for that application. And at this point in time, they've guided towards an approval, including -- they basically have provided a forecast for roxadustat for the fiscal year 2021 across both Japan and Europe, about $80 million. And it is pretty clear that they're also been enthusiastic about the ability for us to be able to reach patients with this important product. Now beyond approval, I think it's important that what can we learn from our success in China and Japan, but let me comment a bit more about China because we -- the last quarter, we recorded net sales to distributors of $43.5 million. I think it's fair to say this is -- this has been a very successful launch. We feel very good about where we are, including -- basically, at the end of the day, is how health care professionals and patients are basically responding to roxadustat, which is they are getting great feedback, great results in real life, and as a result of that, they have continued to adopt the product as a main staple as part of their practices. We continue to see those trends in the same direction that we've seen in over the last few quarters, which has been a constant of sequential growth. And we feel very good about where we are in China. And as I mentioned before, I think we have guided in terms of China in the area of anemia of CKD as having big sales, north of $500 million, not $500 million, but north of $500 million, we clearly continue to see this. AdCom is coming quickly. I know there's a lot of high level of interest in that. And I think you will see us very well prepared to address all the questions from the panel.

Okay. That was good. And I think there are 3 unique areas of value: U.S., Europe, China and each is kind of a different moving part. Let's take those chronologically. I mean, I guess, in the United States, which, let's be frank, is perhaps, in my opinion, the largest opportunity. There is consternation amongst Wall Street because there wasn't -- there was not expected to be an AdCom. Now there's an AdCom. You're preparing for that AdCom. What do you think drove the change in the thinking for an AdCom such that it's even in a different AdCom division than the actual filing? Like how do we tie that together because does that say something? What does that imply? Have you had discussions with that regulatory group who's doing the AdCom?

Yes. The division that is reviewing the file continues to be the same. This is the hematology division. I -- as you know, I think in the FDA, you have the divisions and then you have the office. The office is the one that calls for the AdCom. And the AdCom that is related to this office is the renal and cardio AdCom. So I'm not sure -- honestly, I'm not sure there's a change there. It just -- if there were to be an AdCom, that's how things would have proceeded. So this is not a matter of having an extension and having an AdCom that comes very, very late. So clearly, I think when it comes to any products that will be looked at in this area, in DD and NDD, purely cardiovascular safety is a key topic, and it's of key importance. And we expect that we're going to have all the appropriate expertise to ensure that the benefit/risk profile of the product is discussed extensively and that's what we are ensuring that we're prepared, so we can answer any questions.

Have you been engaged with that review group who is in that AdCom and doing that? Like there must be people there, have they had meetings with you? Do you have the draft book? Do you kind of know what's going on there?

Yes. There's really no contact between a sponsor and AdCom members. In fact, I think they look for AdCom members that have -- that can clear conflict of interest. So -- and no, we have not received the Ad book. We are working closely with the FDA when it comes to analysis and so forth. And I think it is important that walking into the AdCom to be as aligned with the FDA as possible. And how do we interpret any type of different analysis and so forth. We do submit a briefing book, basically, 30 days before the date of the AdCom to the FDA. And I -- at this point in time, I think we continue to prepare, and we look forward to having that day.

Okay. In the scenarios from that AdCom, we could have a really positive vote, we could have a mixed vote. We can have a negative vote. We could have positive and negative votes by indication because you did say you think that the benefit/risk will be taken independently for non-dialysis and dialysis. And presumably, you think the risk/benefit is great for both. Do you believe that those -- that the FDA sees there to be a difference in benefit/risk there one versus the other? Because, honestly, non-dialysis is a different patient population than dialysis. And it was running against a placebo whereas everyone -- these other sponsors claim that they want it against Aranesp. So maybe just make a comment about the benefit/risk in non-dialysis versus dialysis because some people believe there might be a split label here.

Yes, that's not our view. We believe that we will get a broad indication, so covering both DD and NDD. I think it's important that we maybe take a step back and talk about some of the benefits of treating anemia. Probably the one that is most pressing and one that we've seen as part of our extensive clinical trials, is basically that roxadustat was able to reduce the risk of transfusions. Clearly, given that we were comparing to placebo, that benefit was very significant in our trials in NDD. As you know, when it comes to patients having transfusion, the more transfusions that they have, it lowers the risk of the potential for transplantation sometime in the future. So we view, and I think we -- that's -- we view, I think, the benefits of the product has been very significant. Something that is probably that we have come to understand a lot better in China as well, which is something that we don't talk maybe enough about. But clearly, there is a -- having a novel product is something that is pretty important. Keep in mind that in NDD, which is the population that you were asking a bit about patients, about 90% of the patients actually have to go to a physician office to get their ESA treatment. So having an oral alternative, I think is going to be quite important for those patients to truly have access to treatments that are accessible truly and convenient. In addition, of course, to all the clinical benefit that we've mentioned, including that roxadustat is just a more physiological way to be able to treat anemia, right?

Yes, yes. Okay. And then as regards, let's say, we do -- so we do -- I mean get approval for both, do you believe that the FDA sees cardiovascular risk differently as well in non-dialysis than dialysis? Because I think you've spoken before about the fact that, hey, if you're treating against a placebo, how can one say that there's greater cardiovascular risk, then again, some people believe it's a class effect. They just stick all "ESAs" there and just slap the same label because the FDA is conservative. Now at this point, it feels like the stock and the valuation of the company doesn't reflect any of that at this point anyways. But that's always an important idea. If you do get approved because you're confident in approval that the black box would be construed differently. How do you feel about that?

Yes. It's -- clearly, we don't -- I don't want to speculate on what the label may look like even we need to see the discussion of an AdCom. And quite frankly, I think when it comes to the AdCom, you are going to have panel members there that are going to be providing their views with different experiences and so forth. And the FDA will, of course, take all of that input into consideration when thinking about both approval and potential labeling. But the data pretty clearly shows in our view that we are comparable to placebo. And I do believe that the FDA makes all efforts when it comes to label to ensure that the label for the respective product is the one that is included as part of that. I think I've been pretty consistent on that, and I think we've seen it across many different classes.

Can I ask a question, this is a nuance, but it's actually come up and that relates to this, which is we talk about class labeling. And is the class defined as ESAs, such that it is erythropoietin-stimulating agents? Or is it the idea that any mechanism that stimulates erythropoiesis, ESAs as erythropoiesis-stimulating process, not stimulate erythropoietin, do you -- can I just ask question -- because we actually did some work on this and the term ESAs or the class of ESAs -- because there's only been one mechanism, so it's almost like they're interchangeable. Do you think that the FDA may view the concept that the mechanism being different is actually a different process, and that is not stimulating erythropoietin? Again, sort of that nuance because it's actually interesting because how would you argue that the mechanism is quite different?

Well, the mechanism, I think it is quite different. And I think I don't want to speak for the FDA, but clearly, maybe if they didn't think about that differently, maybe we wouldn't have the AdCom, right? So it is a different mechanism. Now -- and we do see different things, right, with the HIF versus an ESA. And we are very excited about providing that alternative to patients. Keep in mind one thing, Michael, I think when we think about dialysis dependent, right -- because let's not go just to the mechanism, and let's go to the actual -- what we actually see, right? It is pretty clear to me that today, there are a number of patients on dialysis that basically are having a tough time managing their anemia. Part of this is because they are hypo-responders. So -- and this is very well documented. You have to continue to increase the ESA dose. Dose increases have their own element of risk. So in a certain way, having this new medicine would basically provide an opportunity for many of those patients that actually need an alternative to be able to manage their anemia.

Yes.

I think that's pretty clear. And we saw that reflected in our data, right, in particular, for people that had high elevated CRP.

I guess I would just argue that if the idea of erythropoietin, which is a recombinant protein, that is what EPO is. Yes, that protein does stimulate erythropoiesis to make more red blood cells. Your drug, because it gives you system ESAs, you're stimulating erythropoiesis but doing it in a different mechanism. That's all I wanted to say. We don't know that giving greater erythropoietin protein is driving a different etiology than what your drug is. I just want to say that it's class label.

Yes. I appreciate you saying that. And it's -- once again, we look forward to having the discussion at the AdCom. I think we have very comprehensive data. So we -- it's great to have so much data because it's the opportunity to be able to answer fully questions of the panel.

So when you're going to get to a panel, you've submitted or about to submit your briefing document.

Yes, we have not -- but -- submitted the briefing doc -- briefing document gets submitted, I believe, 30 days prior to an AdCom.

Then the FDA will give you a briefing document weeks before.

That's right. They will -- I mean, the way things work or they should work is that we are -- that we need to work collaboratively with the FDA to ensure that the panel can have the best discussion.

Yes. Should that happens and then whatever happens with the vote, do you expect that a PDUFA obviously, which never got renewed, do we just go in sort of a black hole and you'll just say, hey, look, we're in discussion with the FDA and there's no defined deadline, then we can move on from the U.S. Is that fair?

Yes. I wouldn't describe it as a black hole, but yes, we don't -- the PDUFA date can only be extended once, which it was. So therefore, at this point in time, there's no other -- there's not a new PDUFA date. I think, fortunately, we were quite advanced with the FDA on labeling discussions in December. So I am hopeful that post the AdCom, the FDA will be able to take action.

Yes. Good. Thank you for bringing that point, I mean the point that you were as of December in labeling discussions and, quite frankly, AstraZeneca, your partner put in the press release that they look forward to continued discussions. And I think they did actually use in the press release the word label. I think that's actually -- it was not like they got stuck halfway through whether this thing is proved or not, it was actually trying to figure out the label. Now whether that's carving out a label, labeling in a certain way, black box, I just want to be clear, let's reemphasize that you were actually talking about labeling discussions, and you were down to that level.

Yes. So I think we were -- clearly, now we do have the AdCom. So you were asking timing after that. And we're hopeful that things could proceed that the FDA could take action quickly because of those advances.