Nuvation Bio Inc. (NUVB) Earnings Call Transcript & Summary

All right. Well, good afternoon, everybody, and thank you once again for joining us for our seventh Annual Oncology Innovation Summit. I'm Yaron Werber from the TD Cowen Biotech team. And as the Extel survey is now launched, if you do feel that the TD Cowen Biotech team has earned your support, please do consider voting for us for both large cap and small and mid-cap. It's a great pleasure to moderate the next session with Nuvation Bio. Really, we have 2 gentlemen that need no introduction. We have David Hung, Founder, President and CEO; and Philippe Sauvage, who is the Chief Financial Officer. So team, thanks for joining us. Good to see you.

Thanks for having us, Yaron.

So lots to talk about on IBTROZI, both commercially and then potentially to start even talking about other tumors that have ROS1 mutations. But let's maybe start on the commercial basis. As of Q1, now over 50% of patients are -- using IBTROZI are in the frontline setting. I think you've noted on your conference call that the early trends in April look -- continue to look encouraging. Can you give us maybe an update commercially on how usage is shaping up so far?

Sure. Philippe, do you want to answer that?

Yes. I mean what we've seen is very encouraging trends, right? And this is something we really want to talk about our commercial launch that's quarter-on-quarter, we had an increase of first-line patients. And, you know, Yaron, because of the incredible efficacy and duration of response of IBTROZI, first-line patients are really going to be the patients who are going to stay on drug for a very long time. So this is really, really what is important for us for the long-term potential of IBTROZI. And quarter on, we see an increase of this patient number of about 35% a quarter. And we think this is a trend we can maintain because the number of patients out there in need of IBTROZI is really high. It's still very much underpenetrated and still many potential for us to grow. So this growth that we've seen in the first quarter of this year of more than 50% of our patients means that it's growth of 35% again quarter-on-quarter of our number of first-line patients. So this is really what we see as the most encouraging recent data there.

And when you say, Philippe, when you say 35% -- what do you mean, 35% quarter-over-quarter growth?

Absolute number of first-line patients. Quarter-on-quarter, absolute number of first-line patients growing. So it's not only about the share of it, it's really the absolute number growing quarter-on-quarter.

Okay. And you think that's sustainable from this point onwards?

No. Because, again, if you think about the epidemiology, there are 750 patients a quarter that should be put on a targeted therapy. And we only have 110 or so for HRD in the first quarter. So still lots of room to grow there and see that incredible good trend of first-line patients.

And the 750 is the newly diagnosed patients per quarter?

That's the epidemiology, the number of patients out there that would need to be put on a TKI, ROS1, yes.

In the first-line setting?

In the first-line setting.

Got it. The -- are you able now -- do you have better line of sight into what's going on in the actual treatment setting, given that most patients are not going through your program, right? But it sounds like they're not going through you, right?

Most of our patients are coming through -- most of the patients we know perfectly about are the ones that are going through NuvationConnect. So this is a smaller share, which is why for a long time, we were careful about not sharing too much information on first-line patients because we didn't want to say anything wrong. But we've done a lot of work in the past few quarters, understanding what was going on in the marketplace, looking at the patients we had in the hub, but also looking at all the other trends we can see from the feedback from our reps, to doctors, to some systems in which we have good insights or what's going on in the systems to any data we can gather from IQVIA about, line et cetera. And when you compile data like that and you all end up with the same number, you feel pretty confident about where you are. So we really see this continuous growth of first-line trend, and we are very confident about it.

Okay. What about the use of crizotinib? Do you have any sense as to what the dynamics are in frontline there?

We do see a decrease in crizotinib use. And as you know, crizotinib has been one of the oldest TKIs out there, been around for the longest time, but doesn't get into the brain. And we've been looking at now a number of health care systems, some of the larger aggregators have shown some interesting trends. We've seen for the first time in one of our large aggregators, a significant reduction in crizotinib use in the first-line setting to IBTROZI. So I think that's a good trend, and we expect that to continue.

Okay. And you mentioned that this is going to be an ongoing sort of evolution quarter-over-quarter throughout the year. What drives that? Is it diagnosis? Or is it really more uptake in the community setting?

So I think there are a couple of things that drive it. If there was one criticism of AnHeart, I would say there was probably not as much U.S. experience and familiarity with the drug as it could have been. So we've now had 3 quarters to get the drug in front of physicians in the U.S., and that's been a great education for them. I think that they've gotten used to the tolerability profile, which is excellent. They've been impressed by the new changes in efficacy that we've just published and are updating in the sNDA of a DOR, duration of response of now 50 months, which is unprecedented. And I think that with that increase in familiarity, these physicians are now changing their practice from using a new drug that they don't know about in the late-line setting to now using a drug that they've had experience with now in the frontline setting. So we've seen scripts really change from primarily third line or later in the first -- in the very first quarter of launch is Q3 to now more than half in the first-line setting by the third quarter of launch, which is Q1.

Got it. Okay. And where do you think by the end of the year, sort of can you be at 75% more in frontline hopefully?

No. Philippe said that we feel pretty comfortable. If you look at the growth in first-line patients on an absolute number, we went from about 60 in the third quarter to about 80 in something in that range in the fourth quarter to about 110 in the third quarter. So that's about 35% quarter-over-quarter growth, and we feel pretty comfortable that we should continue to do that. Philippe has made a comment on other calls that if we continue that rate alone with no acceleration, we should hit our consensus pretty easily. If we accelerate beyond that, we might be able to even beat consensus. But I think that we're saying that this level of growth is something that we're -- we feel good about. We think it's sustainable. And that doesn't even take into account the gradual increase in testing, which we think is also happening in addition to changing practices due to familiarity of IBTROZI. So I think that as -- it has all genetic testing increases for all lung cancer, I think that, that's still a rising tide that will continue to float all boats. And I think that in addition to the increase in familiarity with IBTROZI, we should further benefit by increased testing as well.

Okay. And Philippe, what is consensus now for the year for IBTROZI?

It's around 130, between 130 and 140. And as David just said, we are -- if we keep increasing at that rate, our first-line patients will hit consensus. If we accelerate further, we will go beyond that. And we are feeling good about that number. And I think to your previous question, more -- it's not so much about proportion of patients. It's really about this first line of patients, the pool -- first-line pool growing and growing and growing because we know they are the patients that are going to benefit from the longer time on IBTROZI, this is incredible duration of response, 50 months. And this is really, really something that is important that they will put on as TKI first in first line so that they can stay on drug for as long as possible.

Yes. And in terms of the other TKI, the branded TKI, are you still seeing them sort of competing in the market or they've essentially ceded the share in the U.S. now?

I mean if you look at all the other TKIs, crizotinib use has probably started to decline. In fact, the use has already significantly declined. And I would say that the closest drug to us in metrics of performance is probably repotrectinib. But as you -- as we've just said, we are getting significant growth in first-line share in spite of repotrectinib. So we think that the tolerability profile of IBTROZI compares favorably with repotrectinib. And frankly, if you even look at just the performance metrics, and you mentioned CNS control in the second-line setting, IBTROZI's intracranial response rate is 66%, repotrectinib is 38%. So I would say that just overall, IBTROZI has a very compelling efficacy as well as tolerability profile.

Yes. Okay. Zidensamtinib, eventually, I'm going to learn how to say the name of the drug -- is expected to get approval in second-line setting in sort of early Q4. How do you think the competitive dynamic will work there?

I think that, again, as Philippe has already said, we start off our launch in Q3 with the majority third line or later patients. In Q4, we added second line and later patients. So we -- and in the 3 quarters since we've captured a significant amount of the pretreated market. But we've started to grow first-line share, which we will be at least 2 years ahead of zide for first-line launch. And by the time they launch in second line, I think we will have captured a significant amount of the market. And also, we look forward to seeing their label. We have not yet seen a publication of zidensamtinib. And we'd like to see what their metrics really are as they would appear in the label. As an example, even though zide has presented unconfirmed responses in their publications, that's not acceptable in the label, treatment-related adverse events, it's not acceptable label. So we like to see the real data, confirmed responses, treatment-emergent adverse events, things that would appear in the label. We are not aware of any drug today that has any metrics in efficacy or tolerability that are close to IBTROZI.

And you're expecting really approval in second line onwards, right?

Before zidensamtinib?

Yes.

So just to refresh your memory, FDA gave them breakthrough designation in the third-line setting, but they're applying for a second-line approval. We received breakthrough designation in the first and second-line setting. And on top of that, we got a priority review and they did not. So again, for an agency that's seen all the data sets, they've certainly prioritized IBTROZI over zide, and we expect them to have a late-line approval, and we expect their data to be inferior to ours.

And then I think they're planning on filing for frontline after the September 18 PDUFA. At that point, it's going to be a supplemental filing. What kind of a label do you think they can get in frontline? I think they have maybe 2 -- 18 months to 2 years of follow-up so far roughly.

I think it just comes down to how good the data are, and we just haven't seen it.

Yes. Okay. In terms of formulary...

Apologies, Yaron, we will not have the level of maturity of data that we currently have, which we think is something that, obviously, we will have for a very, very long time, more maturity than they do and also being 2 years ahead in the market is really, really important.

I mean our response rate in the first-line setting is 90%. I mean, how much better can you get than that? Our duration of response in the first-line setting is 50 months. That's virtually unprecedented in all of oncology. I don't know how much better you can get than that. So we feel really comfortable with our profile. I think it's going to be really, really hard to beat. And there's a reason that we got first-line BTD and no one else did. So I just think that the data should speak for itself, and we look forward to seeing it.

Yes. So at ASCO, zide is actually going to have data from other tumors, ROS1-positive other tumors. Is that something that you might be interested in doing studies as well?

So we actually had a small number of patients in our study who had ROS1-driven cancers that were not lung cancer. They are more rare. But in fact, we actually are currently treating a little girl with a ROS1 GBM, glioblastoma brain cancer, and she's had a great response to IBTROZI. So we -- where we do see them, we think that IBTROZI is a great drug for ROS1, no matter what it drives, but those other cancers are far rarer than lung cancer. So the main market for ROS1 is the lung cancer.

Okay. So that's not something that you're thinking about formally studying the drug in?

I mean I think everyone knows that our drug works great against the ROS1 fusion. So as an example, when this little girl had a ROS1 brain cancer, they put on IBTROZI, but that's not going to be the majority of our commercial opportunity.

Yes. Okay. Let's move -- and by the way, for the audience, if you have questions, you can go ahead and as you know, put them right into the channel. Otherwise, you can go ahead and e-mail them to me, and we're happy to take them on your behalf as well. The -- let's go to safu and talk about -- I guess there's definitely a lot going on, and that's a drug that's increasingly getting traction and attention from investors. In terms of the Daiichi Phase II in the non-enhancing low-grade glioma, now that you're controlling sort of the data, when do you think you might want to publish that data?

We're going to try to publish everything we have because I think the data are really compelling. We think that safu is really an interesting drug because where vorasidenib is the only IDH1 drug approved today in brain tumors, it's only approved in 1 of the 4 pieces of the glioma pie, only in low-risk, low grade. And we have data in both low and high-grade brain tumors with IDH1 showing really significantly more robust responses and progression-free survival. And so we feel it's important to publish that, and we're going to do that. But more importantly, we're now doing studies that are going to target all 3 pieces of that pie. So our SIGMA study will now target everything where vora isn't, which is high grade -- sorry, high-grade, both low and high-risk high grade as well as high-risk low-grade tumor. That's 3 of the 4 pieces. We're doing a second study in the Grade 3 oligos, which are the lower risk subset of the high-grade patients, again, where vora has shown a 0% response rate in high grade. And now we're even looking at some, designing another study in post vora failures. And that's particularly interesting because as you know, from vora's response rate and PFS, at 1 year, about 23% of vora patients progress in that low-risk, low-grade population, which means that they've been out for about 15, 16 months already. And Servier has already said they've treated 5,500 patients. So if 1/4 of them are going to progress within a year, we think there could be 1,000 patients approaching failure right now. And we think that the number of patients we would have to show responses in to potentially get an accelerated approval could number as low as 50 to 80 patients. As you know, Chimerix got approved on response rate in 50 patients with a 21% response rate. Day 1 got OJEMDA approved based on 77 patients in pediatric glioma. So we think that we were to show responses in the post vora setting of greater than 20% in 50 to 80 patients. We think that's potentially a registerable study. So we are now designing that study and think that out of the 1,000 or so post vora failure patients that should be happening within a year, we think that we could pretty easily get 50 to 80 patients to assemble a package that would be pretty compelling to FDA.

And this is going to be essentially adults at that point, anything outside of pediatrics or...

We're going to start within adults first.

Yes. And at that point, you'll use the same dose, the 250 BID?

Correct.

The -- okay. The -- So you mentioned the SIGMA study, which is essentially enrolling all 3 subtypes that Voranigo is not approved in. And then also a study that's going to be targeting that fourth indication where Voranigo is approved, right? Can you discuss that study, that second study?

Well, so the SIGMA study is 3 of the 4 patients that vorasidenib is not approved. The second study is actually the Grade 3 oligo study, which -- where vorasidenib is also not approved. It's not approved in anything that has a high grade in it. And so that study is a response rate trial. And those patients can stay on drug for 12 to 14-plus years. So it's a very significant commercial opportunity because of the revenue stacking that could occur. And because there's nothing approved in it, we think that, again, a trial that could be approved on as little as somewhere between 50 to 80 patients. We cite OJEMDA with 77 patients approved on a response rate only as a precedent for that. And then the third study is the study I mentioned that we're designing, which is a post-vorasidenib failure study. Their population is low risk, low grade. So we're talking about patients who fail vorasidenib for which there's absolutely nothing, a large market, a lot of patients out there right now because they've treated 5,500 patients, about 1/4 of them will fail within a year. And so we think that we need 50 to 80 patients to get a pretty compelling package assembled.

Right. So This is okay -- that's okay. Thanks for the clarification. So that's actually that indication we talked about the Grade 3 oligo. That's actually the 40 patients as part of SIGMA.

So, not [ exactly ], it's actually part of SIGMA, but it's really a separate study in itself because it's specifically a pure population of Grade 3 oligos. And while that trial is targeting 40 patients which we should complete by next year, if we see responses in our first few patients, we would probably expand that to 80 patients instead of waiting for it to finish and then expanding because, as I said, we just want to be ready to go with a package that we think FDA would find substantially enough to consider approval in, which we think at 80 patients would be larger than both the Chimerix and Day 1 packages.

Okay. Got it. And the bar -- okay, right. So it's sort of a part of SIGMA, but it's obviously the same protocol, the same study...

And unlike SIGMA, which is a PFS readout, this grade 3 is a response rate readout, which is much, much faster.

And what's the bar there? Is the bar still the 20%? Or is it really 30%?

Chimerix got approved on 21%. So we think north of 20%. If you look at the bar to beat, which is chemotherapy, chemotherapy response rate is in the single digits. So we're talking 5% to 8%. We think 20% easily beats that. We think anything north of 20% like Chimerix did is enough.

Yes. Okay. And at that point, what's the durability? Is that also -- does FDA want to see 6 months or once you get a response that's fairly durable?

I think we need to wait and see what FDA actually says. But I would -- I'm going to guess that there's nothing for these patients, it wouldn't be a really long time.

Okay. And you have 30 sites that you're opening or opened already, right?

And we're opening more. So yes, I think we are all about trying to move this fast now. And we would expect to have data from the Grade 3 oligo study next year and as well as we should have some data from the post-vorasidenib study in at least some patients by next year as well.

Got it. Okay. The -- and then in terms of that you've signed up, I'm going to switch back to IBTROZI. You've signed the deal with Eisai. What's the next step in Europe now for IBTROZI?

The next step in...

In Europe, David.

Okay. Yes. So we submitted for full approval in Europe. We expect to be reviewed in about 9 months. That would be a normal time line, Yaron. So that would be early next year, somewhere Q1 or Q2 next year for an approval. And then it will be the typical European launch country after country, starting with probably Nordics and Germany is usually the case, but we've not discussed that yet with Eisai. We're still on the approval path.

Got it. And remind us what's the remaining milestones under -- for approval for Eisai?

So we have a milestone for approval, yes, coming at time of approval of EUR 25 million, and that would be either for early next year. And that will reinforce even further our very solid balance sheet. We already have $530 million, as you know, so that will add to that.

Okay. And then you potentially could draw down another $50 million from Sagard, from your tranche, that...

Yes, we could. We've not made the decision yet, but we'll wait to the last possible time to make sure that we have the right strategy there that we can.

Okay. And then in terms of SG&A, you've been kind of flattish between $38 million and $40 million a quarter. Is that sort of a good place where you'll remain for the time being?

Well, obviously, we have a big acceleration of our commercial spend last year with the launch, but now we're getting more to a kind of stable situation from a launch perspective. So we don't expect that to go up and down too much. There are always variabilities quarter-on-quarter, as you know, but we don't expect that to be huge.

Okay. And then finally, any thoughts on business development and what kind of assets you're potentially looking at? And does it make sense to bring in other commercial assets even if they're not huge, let's say, and they're fairly undervalued right now?

I think it really just depends on the price we have to pay for them and where they are, how close they are to commercial. Clearly, later-stage assets are more attractive to us, but they're more costly. So we have to balance what we think is a great deal and where the product fits into our pipeline to make a decision. We know we are really happy with the AnHeart acquisition. That was a great acquisition. We do that all over again. So for us going forward to move the needle for us, we know we would have to look at something that would be additive or at least sits additive or synergistic with our IBTROZI commercial opportunity and had to be something within a reasonable price.

Okay. There are so many assets in China. Does it make sense to go and bring something that was developed in China?

No, we're looking at China. We have a big footprint there. So we definitely are looking there, but we're looking everywhere because they're good assets everywhere. And this is still a difficult financing environment. Many of these companies don't have a lot of options. And so there are a lot of assets we think that could be good opportunities for us. So we're going to be patient and very disciplined about it.

All right. Well, David and Philippe, good to see you as always. Looking forward to seeing you at ASCO. Thanks for the interest.

Thanks, Yaron.

And the next session starts in about 4 minutes.

All right. Take care.

Sure. Bye-bye.