Lumos Pharma, Inc. (LUMO) Earnings Call Transcript & Summary

Good morning, and welcome to Lumos Pharma's top line results conference call. [Operator Instructions]. As a reminder, this conference call is being recorded. I will now turn the call over to Lisa Miller, Senior Director of Investor Relations.

Thank you, operator. Before we proceed with the call, I would like to remind everyone that certain statements made during this call are forward-looking statements under U.S. federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations. Additional information concerning factors that could cause actual results to differ is contained in our periodic reports filed with the SEC. The forward-looking statements made during this call speak only as of the date hereof, and the company undertakes no obligation to update or revise the forward-looking statements. Information presented on this call is contained in the press release we issued yesterday and in our Form 8-K, which may be accessed from the Investors page of the company's website. Speaking on today's call will be Rick Hawkins, CEO and Chairman; John McKew, our President and Chief Scientific Officer; Dr. Duke Pitukcheewanont, Senior Vice President of Global Clinical and Medical Affairs; and Lori Lawley, Chief Financial Officer. I will now turn the call over to Rick.

Thank you, Lisa, and good morning, everyone. After the market closed yesterday, we issued a press release announcing top line results from our Phase II OraGrowtH210 and OraGrowtH212 trials of oral LUM-201 in Pediatric Growth Hormone Deficiency or PGHD. I'm pleased to report that all primary and secondary endpoints were met in both trials, and data from these trials provide supportive evidence to advance LUM-201 to a Phase III clinical trial. I'm going to commence by offering a summary outlining how we believe these data convincingly establish the validity of LUM-201 as a potential Ora replacement for moderate PGHD patients eliminating the need for daily and weekly injections. Subsequently, I'll hand over to the discussion to John McKew, our President and Chief Scientific Officer, who will provide a thorough examination of these results. So, to begin, findings from our OraGrowtH210 study indicate that the LUM-201 dosage of 1.6 mg per kg of 8.2 centimeters a year at the 6-month mark and 8 centimeters a year at the 12-month mark. These figures align with the historical growth rates observed in the moderate PGHD population. The difference in annualized high velocity at both the 6- and 12-month time periods between the ideal 1.6 mg per kg LUM-201 dose and the recombinant human growth hormone comparative group falls within the non-inferiority threshold of less than 2 centimeters a year, which aligns with the criteria recently employed by FDA approvals. While it's important to note that this study was not designed with the power to establish noninferiority, we're delighted to observe that the growth outcomes in this study are on par with the recombinant human growth hormone comparator arm falling within the recent Phase III non-inferiority thresholds utilized for FDA approval. Furthermore, the preliminary 24-month LUM-201 data compiled from 2 sources, and that is a subset of the OraGrowtH210 participants who met the protocol requirements for an extension beyond 12 months and the OraGrowtH212 subjects reviewed a sustained effect with no material decrease in annualized height velocity between the 12-month and 24-month time frame. Moreover, in the OraGrowtH210 study, we successfully attained our predefined primary endpoint, confirming the validity of our Predictive Enrichment Marker or PEM test. We also met the secondary endpoint by demonstrating 100% reproducibility of the PEM-positive classification. Additionally, data from the OraGrowtH212 trial highlighted that LUM-201 achieves growth comparable to excites injectable recombinant growth hormone while utilizing only 20% of the growth hormone concentration levels. This discovery underscores the significance of LUM-201's unique pulsatile mechanism of action and its capacity to restore the natural postal release of growth hormone. And lastly, regarding the safety data gathered from both our Phase II trials, we obtained a well-defined safety profile for LUM-201 and at present, there have been no safety concerns associated with its use. And considered LUM-201 induces annualized height velocities in alignment with historical norms from moderate PGHD patients on recombinant human growth hormone that demonstrates a robust and enduring response and validates our PEM strategy for the selection of suitable moderate PGHD patients and continues to maintain a clean safety record without any signals of concern, we are confident in the strength of our data set for presentation during our end of Phase II meeting with the FDA, and a finalization of our Phase III trial plans. So with that, I'm going to now hand it over to John McKew for a more comprehensive review of our data. John?

Thank you, Rick, and good morning, everyone. Before I review the data, I would first like to remind everyone of LUM-201's unique mechanism of action. LUM-201 is a small molecule that agonizes a specific receptor on the pituitary and the hypothalamus to stimulate pulsatile growth hormone release over 24 hours, which thereby increases IGF-1 in circulation and both the growth hormone and IGF-1 then act on the growth plates, enabling a child and growth of efficiency to grow. This pulsatile mechanism is very different from injectable hormone and the PK curve that its nightly bolus injections produce. Also unique to LUM-201 is that this molecule intervenes above the release of growth hormone. So the naturally evolved feedback mechanisms that define physiological levels of growth hormone and IGF-1 are still intact. This prevents LUM-201 from overstimulating the pituitary and producing too much growth hormone and subsequently too much IGF-1. This unique mechanism has implications regarding who might respond to our molecule. For analysis of LUM-201's mechanism and previous clinical studies in this patient population, we're able to establish cutoff levels for both baseline IGF-1 and LUM-201 stimulated growth hormone to determine likely responders to LUM-201. We found that patients with a baseline IGF-1 of greater than 30 nanograms per ml and a peak growth hormone stimulation value greater than or equal to 5 nanograms per ml were those deemed likely to respond to LUM-201 treatment. These cutoffs represent our predictive enrichment markers or PEMs, which we use to enroll patients for OraGrowtH210 trial. Now I'd like to provide a brief overview of the OraGrowtH210 trial results. As many of you may recall, this trial involved a dose-finding study with 82 subjects with the primary goal of assessing the annualized type velocity or AHV at 6 months on treatment. Additional objectives included the confirmation of the prespecified outcomes assessing the effectiveness of our PEM strategy and the ability to choose an optimal dose for a Phase III trial. It's worth noting that as a Phase II trial, the OraGrowtH210 study is not designed to establish statistical noninferiority in AHV between LUM-201 and the control arms. To begin, I will discuss the baseline characteristics that predicts growth for the subjects participating in our dose finding OraGrowtH210 trial. During our interim analysis, we observed imbalances among the various treatment arms, particularly in terms of age, which seem to augment the differences in growth rates during treatment. However, as we continue to enroll subjects in the trial with a focus on the 1.6 mg per kg LUM-201 arm and the comparator we combine human growth arm, we have observed the expected narrowing of these imbalances. Consequently, the birth rates in these specific cohorts have started to align. We anticipate that in a fully powered Phase III trial, we will likely achieve better balance between the treatment and the control arm, resulting in a more comparable growth rates. We conducted a standard ANCOVA analysis to determine the least square mean of AHVs at both the 6-month and 12-month intervals for the study for the 1.6 mg per kg dosage of LUM-201, LUM-201 achieved an AHV of 8.2 centimeters per year and 8.0 centimeters per year at 6 and 12 months, respectively. It's worth highlighting that the disparity of 1.8 centimeters per year at 6 months and 1.7 centimeters per year or 12 months between the 1.6 mg per kg dose and the recombinant human growth comparator are within the historical noninferiority margins commonly agreed to in recent Phase III growth trials. Furthermore, when examining the 12-month AHV data available for 50 out of the 81 subjects, it is clear that the growth rates observed remain consistent and enduring at the 12-month milestone. Allow me to direct your attention to the unexpected increase in annualized height velocity is observed in the moderate PGHD population treated with the daily recombinant human growth hormone in the control arm. This outcome deviated from the expectations set by numerous historical trials, which anticipated growth rates in the range of 8.3 to 8.6 centimeters per year for moderate PGHD. We suspect that this typical growth in the daily growth hormone, this study was likely influenced by the higher recombinant growth alone dosage administered and the presence of specific growth outliers. LUM-201 PGHD aligns with growth rates historically observed in similar patient populations from the Phase 4 Eli Lilly GeNeSIS database, apprise KIGS database and a Spanish study of moderate PGHD patients. Furthermore, at the 12-month time point, LUM-201 exhibited an annualized height velocity within 1.3 centimeters per year of the daily injectable recombinant human growth hormone arm of the Pfizer Phase III somatrogon trial for the subset of subjects that are similar to our moderate PGHD population. Now to shift our focus to the predefined primary and secondary statistical objectives of evaluating our PEM strategy. We met our preliminary validation of the PEM strategy as being effective in enriching our trial for LUM-201 responders. Additionally, we achieved 100% reproducibility in the PEM positive classification of subjects randomized in the ore Grop210 trial. These 2 outcomes reinforce our confidence in using this PEN strategy for our Phase III program. IGF-1 working in conjunction with growth hormone plays a role in stimulating growth by acting on the open growth rates of the OraGrowtH. Data from the OraGrowtH210 revealed that LUM-201 successfully restored IGF-1 levels to a normalized state within 6 months of treatment, and this effect persisted at the 12-month time point. Importantly, we believe that this capacity to normalize IGF-1 has direct consequence of LUM-201's pulsatile mechanism of action, which operates within the natural endocrine feedback we effectively regulating growth hormone IGF-1 levels to mimic the experience of normally growing children. In summary, the OraGrowtH210 trial successfully achieved all of its primary and secondary endpoints onto demonstrated annualized height velocity results that are in line with historical benchmarks for a moderate PGHD population, meaning our growth expectations. Additionally, LUM-201 was shown to restore IGF-1 standard deviation scores to a normalized state within 6 months of treatment, and this effect was durable to the 12-month time point. Furthermore, the continuing safety profile of LUM-201 was reaffirmed. Now I will turn the call over to Duke to discuss our mechanistic PK/PD OraGrowtH212 trial. Duke?

Thank you, John. Transitioning to the outcome from our PK/PD OraGrowtH212 study. It is very important to note that this was a single site trial involving a more uniform patient population compared to our monthly national OraGrowtH210 trial. The OraGrowtH212 study was designed to investigate the impact of LUM-201 on endogenous growth hormone positivity and analyze high velocity while also assessing the pharmacokinetics and pharmacodynamics of LUM-201 in a pediatric glutamine deficiency population. The demographic of those enrolled in OraGrowtH212 highlight a greater degree of deformity within this trial, in contrast to what we observe in OraGrowtH210. However, the best like caters across both try were comfortable enough to permit combining them for further analysis. The NOI high velocity finding at the month mark of treatment review a substantial growth improvement from pretreatment growth rates for both the 1.6 and 3.2 milligram per kilo dosage of LUM-201. These filings will corroborate by the analyze high velocity data from the 12-month treatment population in these per vertical analysis, indicating a persistent and lasting impact of LUM-201. IGF-1 standard deviation score data reaffirmed the outcome of the OraGrowtH210 study, illustrating that LUM-210 effectively restores IGF-1 level with the sustained impact lasting up to 12 months of treatment, and no excursion beyond 2 standard divisions were observed in this time period. PK/PD data demonstrated that LUM-201 promotes and elevation impulsive secretion of growth hormone, restoring the levels seen in normal physiology. We're examine the 24-hour pulsatile secretion. The data review that LUM-201 achieved growth comparable to exogenous injectable recombinant human growth hormone while utilizing only 20% of the growth hormone concentration levels. These results imply growth hormone secretion generated by LUM-201 is potentially more efficient than daily growth hormone in promoting growth. We want to emphasize that LUM-201 ability to restore the endogenous pulsatile secretion of growth hormone enables this remarkable increase in growth with significantly less circulating growth hormone, all while maintaining IGF-1 level within normal range. In summary, OraGrowtH212 achieved all primary and secondary endpoints with the data providing strong support for this distinctive novel mechanism of action of LUM-201. Now shifting our focus to the combined data from these 2 studies, early findings for the 24-month period suggest that LUM-201 exhibit a more enduring response compared to recombinant human growth hormone. We hypothesized that the small decline in year 2 annual high velocity compared to recombinant human growth hormone can be attributed to the LUM-201's ability to bring growth hormone and IGF-1 levels back to normal through its unique pulsatile secretion mechanism. The investigational safety data combined from these 2 trials indicate the absence of significant serious adverse events. No participant withdrawal due to serious adverse events or adverse events and no noteworthy safety concern observed to date. With that, I will pass the floor over to Lori for a brief summary of our Q3 financial results, which we also reported yesterday.

Thank you, Duke. Lumos Pharma ended the quarter on September 30, 2023, with cash, cash equivalents and short-term investments totaling $42.7 million compared to $57.4 million on December 31, 2022. The company expects use of approximately $9 million to $10 million in the fourth quarter of 2023. The Cash on hand as of September 30, 2023, is expected to support operations through the third quarter of 2024, inclusive of the activities related to planning and initiation of a pivotal Phase III clinical trial. Research and development expenses were $5 million for the quarter ended September 30, 2023, compared to $4.1 million for the same period in 2022, primarily due to an increase of $0.9 million in clinical trial expenses, $0.2 million in consulting expenses, offset by a decrease of $0.2 million in personnel-related expenses. General and administrative expenses were $3.9 million for the quarter ended September 30, 2023, on sales as compared to the same period in 2022. The net loss for the quarter ended September 30, 2023, was $8.3 million compared to a net loss of $7.3 million for the same period in 2022. Lumos Pharma ended the third quarter of 2023 was 7,914,582 shares outstanding. Now I'll turn the call over to Rick for some final remarks and forthcoming activities.

Thank you, Lori and John and Duke. And as is evident, we're very excited and impressed by the data that we shared today. Both OragrowtH trials have successfully achieved their primary and secondary objectives. The annualized height velocity data from the LUM-201 at the 1.6 mg per kg dosage falls within the historical Phase III non-inferiority thresholds and the PK/PD data suggests unique advantages associated with the mechanism of action of LUM-201 for patients with moderate PGHD. In the following stages of this program, we're currently immersed in a careful preparation for a Phase III trial with the data now available, the initial step involves seeking it in the Phase II meeting with the FDA to evaluate the Phase II outcomes and establish the final design of the pivotal trial. We plan to make the request for the end of Phase II meeting with the FDA within the first half of 2024, and we will expect to kick off the Phase III program in the latter half of 2024. In conclusion, we're confident that our findings suggest that LUM-201 has the capacity to revolutionize the global growth hormone market, which has been dominated by injectable products for nearly 4 decades. We're enthusiastic about progressing with this significant program, and we want to thank all of our clinical investigators, their staff, the patients, families who participated in these trials. And we each and every one of them are gratitude for the successful realization of these trials. We believe this sets the stage for potential novel oral therapy for modern PGHD that benefit patients and families worldwide. But thank you for your attention. And operator, we can now open things up for questions.

[Operator Instructions]. Our first question is from Charles Duncan with Cantor Fitzgerald.

Rick and team, congratulations, very nice results, good for patients, potentially transformative. I had a couple of questions for Duke. And I'm trying to have him answer this from the perspective of a doctor who used to treat patients or maybe still does with pediatric growth hormone deficiency. I guess I'm wondering if he could provide a little bit more color on the lack of considerable decline over time, not only in terms of, yes, the effect size in 1 year, but the effect size over a couple of years. And then I also had a question on the safety observations.

Yes. So go ahead, Duke.

Yes. So thank you for the question. This is very good, right? As you know, that most of the growth hormone therapy, the dose of the growth hormone that provides for the patient with deal injection is super physiology. LUM-201 has a unique mechanism that basically provide 24-hour growth hormone secretion. And we do believe that with this drug, that mimic physiology, you can enhance the growth hormone secretion throughout the growth period. As you know, children, the growing depend on when you start the treatment. They boy will continue to grow until 18 and girl continue to grow above 15. So basically, with a normal physiology, it can match up with the normal growth pattern is appropriate. And that is signaling not just only the safety profile itself, but basically the continued progress of the growth. And we do believe that this bioprocess during puberty, that LUM-201 can help to promote growth aligned with the pivotal growth as well.

That's helpful. I had a question on safety, and I'd like you to answer this in the context of potential safety or lack thereof of super physiological growth hormone. I guess I'm wondering, in terms of the 40% treatment-related AEs in the $1.6 billion arm. Can you provide some color? Any observations that were maybe greater than 5% of control? And then there was, I think, one patient with a transaminase increase. How do you see that, especially relative to the current standard of care?

Yes. So thank you. So let me separate into 2 words, right? So the safety for LUM-201 versus super physiological those treated by growth hormone, right? So in that study, as you can see, the percentage of LUM-201 percentage of the adverse event may be a little bit higher, but part of that due to 2 things. If you can see that part of the PEMs strategy, every single patient who came into the trial, regardless they get enrolled or not. If they expose to LUM-201 even 1 dose, we need to document that adverse event. Majority of those adverse event, even though you see the percentage seem on the high side, but none of them related to LUM-201. Come onto the treatment adverse events that have been demonstrated LUM-201, especially one subject with increased transaminase. So as you can see that, that specific project, when you look into the details, the only my elevation liver enzyme and the result over time want to continue to follow those patients. Now unlike the super feature dose that treated with daily growth hormone and long acting. As you know, especially recently approved long-acting growth hormone, you can see significant higher IGF-1 SDS and growth hormone concentration. In 1 week treated with growth hormone, long-acting growth hormone, you can see that the growth hormone in circulation is at least the first 3 to 4 days after the injection, you can see a very high [indiscernible] physiology. However, it comes down towards the optimal or baseline to 7 days. And IGF-1 excursion higher because when you give exogenous daily growth hormone, you shut down a negative feedback loop, which is basically, you cannot control how high-level IGF-1 will be. That's one of the unique mechanism of LUM-201. That differentiates the itself from the daily growth hormone therapy because we would not be able to generate IGF-1 high normal because we have intact feedback that control the IGF-1 within normal range. And one thing I want to point out, as I present earlier, it's very interesting that we only need approximately 1/5 of the growth hormone concentration in order to achieve the comparable growth velocity. This is a very breakthrough information that potentially could be a unique treatment for the patient in the future.

Got it. One last multipart question for Rick or John Morris, call it, strategic know that you haven't met with the FDA, so don't expect you'd be all that granular on this. But if you contemplate a Phase III design, can you give us a sense of rough size? And does the PEM strategy help you to at least make that more capital efficient, if you will, if not in terms of size, at least in terms of patient population? And then maybe for Rick, are you contemplating partnering this? And would that be a geographic partnership or perhaps sub-broader?

John, why don't you start with that question?

Thanks, Charles. So I think as you said, we haven't finalized our Phase III plans, but we have been looking towards what the other log acting molecules in the space have used further Phase III or pivotal designs. And we anticipate a similar sized trial, so something on the order of 200 subjects. In many of those studies, they did a 2:1 randomization between the test article and the comparator arm. That is the direction that we're planning towards. But obviously, we have to do more work right now finalizing our Phase III plans based on the data we just turned over and then negotiate with the FDA to agree on that. But that's the vision we have right now. And I'll turn it over to Rick to answer the rest.

Thanks, John. Charles, I think we're really fortunate to be at this stage in development as a company as we're looking forward to a global Phase III trial in a company that's a late stage in development. Usually, a lot of good things happen in terms of potential partners that may show up. I think we've guided in the past that, yes, we've been active in talking to a number of people around the world. We want to keep the major markets for ourselves. And I think many companies at this stage do consider regional partnerships where they can bring in a substantial amount of nondilutive capital. And that combined with a typical rate at this stage would provide a healthy outlook for the company financially.

Congratulations on the results.

Our next question is from Yasmeen Rahimi with Piper Sandler.

Congrats on the amazing data. A quick question for you. I guess the first one is really great to see the 12 months data. Could you comment on moving forward, do you have any additional time points beyond 12 months to see at the growth chart as patients continue on treatment. If we don't have it on hand, when do we expect to have that? And then I have a second question as well.

Good question. Yes, and I'm going to let John address that.

So the study is still ongoing, the 210 and 212 studies are both continuing to go forward. So the 12-month data that we've presented as of today is just how many subjects made into 12 months when we read out the full 6-month data package. So as time goes on and the rest of the cohort makes it to 12 months, that's another very important data set that we'll be sharing when we get to that point.

So could we envision multiple readouts into 2024 from those data cuts and major conferences. If you could just maybe talk about the cadence of data in the next 12 months, that could be helpful.

Yes. So we will fully enroll that the full cohort at 12 months will absolutely come out next year in the first half of next year. And I think we have several key endocrine conferences that happen in the spring time with Pediatric Endocrine Society in the endo meeting. And then later in the year, we'll have the SP meeting outside the U.S. So I think those are going to be the 3 key time points for scientific presentations on our full data set. We are also hosting more currently a KOL session on December 6, where we'll explore this current data set in much more detail.

Wonderful. And then maybe a last question is, could you maybe talk about what our areas of discussion in regards to Phase III design, you talked a little bit about the potential size. But maybe what are areas where maybe you may have sort of a negotiation with the agency in regards to pivotal for? And I'll jump back into the key and thanks again and congrats.

Yes. Thank you for that question, yes. And I'm going to turn that back over to John, too.

Yes. I mean I think the data package we just turned over has the pieces that we need to have this discussion with the FDA, right? You have to look at the effect size, the variability in each cohort. And we have to take that plan for the size trial that I think is going to be appropriate to run for Phase III. So there are lots of pieces of data that are still kind of slowly coming out. One of those is the PK data from our 212 study. We're still waiting for that whole data package to come out. And those are all some of the pieces that we'd like to have in hand with where we finalize our Phase III study.

Our next question is from Leland Gershell with Oppenheimer.

Adding my congratulations as well on this terrific readout. Also great to see the 100% reproducibility in the PEM testing element. And to that end, I wanted to ask maybe early days, but I wanted to ask with respect to the criteria for the PEM test. With the benefit of these prospective data, did you see any correlation between the magnitude of either the 2 elements in terms of the IGF-1 at baseline or the growth hormone response? Did they reach which a particular patient increase their height velocity?