Olema Pharmaceuticals, Inc. (OLMA) Earnings Call Transcript & Summary

Okay. Great. Thanks, everyone, for continuing to join us. My name is Brad Canino. Happy to be sharing the stage with Sean Bohen from CEO of Olema. Sean, thank you so much for joining us.

Thank you, Brad.

Maybe a quick intro to the company would be helpful. You also did have an executive change recently. So maybe speak on that, and how you're preparing the company for the next stage of its evolution.

Yes. Well, thank you, Brad, and thank you, everyone, for attending. Olema is a company focused on transforming the standard of care for patients with ER-positive, HER2-negative breast cancer. So this is a large unmet need. Breast cancer is the most common cancer diagnosis in women worldwide. It's the second most common cause of cancer death. And ER-positive, HER2-negative is 70% of breast cancers by far the majority. Our lead program is palazestrant. It's a complete estrogen receptor antagonist. Endocrine therapy is the backbone therapy for ER-positive HER2-negative breast cancer. It's given in every line until you have to give chemotherapy, which is the treatment objective is to put that off as long as possible. Palazestrant is in 2 Phase III trials, a monotherapy in the second, third-line setting, and that will read out in the fall. That's called OPERA-01 in a combination with ribociclib in the first-line setting. That's the only estrogen endocrine-sensitive first-line trial with ribociclib as the CDK4/6 inhibitor, which is obviously the global standard of care based on survival benefit. And that trial is enrolling right now. We have a second program, which is a KAT6 inhibitor. It's really a KAT6/7. We dialed out the KAT5 and KAT8 inhibition that are seen with the Pfizer lead compound. And that first data from that molecule will come out late in Q2. That will be mostly monotherapy data. The monotherapy is actually not just in breast cancer, it also has castration-resistant prostate cancer and non-small cell lung cancer. And then the combinations, we don't have an MTD yet, but we have started the combinations with OP-3136, which is the KAT6 inhibitor with fulvestrant and palazestrant. And so that data, we won't have to share in Q2, but maybe later on in the year, we'll be able to inform people about that. With regard to management change, yes, we had a CFO, COO departure couple of weeks ago. Shane had been with us -- Shane Kovacs had been with us for almost 6 years. And by mutual agreement, he departed. The company is, as I mentioned, Phase III readout in the fall. Companies -- as companies do, if they make it in biotech transforming, and we're transforming. We've started our -- we made our first commercial hires. We're preparing to build a commercial organization and a sales force. Our vision is to be a fully integrated oncology company, and that means launching and promoting palazestrant in the United States. We will not do so worldwide. We'll seek a collaborator for those purposes. And obviously, that changes kind of the structure of the company, but also the structure of the financials for the company to a revenue-generating company, cash flow positive, hopefully, in the not-too-distant future post launch, could be as early as next year that the launch. And so we are looking for a person who can really have some experience with that and help us with that.

Okay. Makes sense. Now you introduced palazestrant. You generated a lot of clinical data with this, both monotherapy and combo. What would you highlight in terms of what supports its potential to be a best-in-class oral SERD?

Yes. I mean the simple thing here is that the best way to predict the future outcomes of a drug or combination are to look at the past outcomes, the past data with that drug or combination. So if you look at that with palazestrant, what you'll find is that it stands out from this SERD field. So it's a complete estrogen receptor antagonist with higher exposure than the other agents, oral daily pill with an 8-day half-life. And so you are able to maintain a very high exposure. tolerability profile allows you to do that. And in addition, it's uniquely combinable with other agents. We've combined with ribociclib, palbociclib, everolimus, alpelisib. We're combining with Pfizer's CDK4 selective atirmociclib now. We are combining with our own KAT6, as I mentioned now, and we've been able to give full doses of those agents. If you look at our monotherapy Phase II data, in the ESR1 mutant setting, we had 7 months of PFS and 5.5 in the wild type. Those -- the 5.5 in the wild type exceeds what others see in the mutant setting. So if we're able to duplicate that in OPERA-01, we have a really unique opportunity to be better in the mutant subset, where others have shown some activity and to address the wild-type subset, which is currently an unmet need. In the first-line setting post CDK4/6 with AI, our ribo, pala combo had a year, which again is an outstanding result and very much supports the potential of OPERA-02 going forward.

We're about 2 months removed now from seeing at San Antonio, the giredestrant Roche data in the adjuvant setting, the lidERA study, where it beat both tamoxifen and an AI. How has the KOL community digested those data? And how has it impacted their thinking on the potential of oral SERDs across the treatment paradigm?

Yes. I think -- so I think there is still digesting going on to be perfectly honest. We've been able to talk to KOLs, talk to our investigators. And the data is impressive. The lidERA data is impressive, and Roche points that out quite rightly. I think there's a mixture of opinions coming into the study. Some people thought it had great potential. Others thought it couldn't beat the AI. And very clearly, it did and quite soundly. So I think what's being digested is where does this fit into the treatment paradigm, right? Because in much of the population studied, now those patients are getting a CDK4/6 inhibitor, either verzenio or ribociclib and kisqali. And so the question is, what do we do next? Do we give just giredestrant. We don't have -- there's no data on the combination. That wasn't a thing when Roche started that trial. So I think that, that's what's going to evolve over time. I think there is an attractive aspect to giving the single-agent giredestrant option. And so we'll see how that plays out. With regard to the overall, our investigators mostly interpreted our trials and their interest and they enroll very well based on our data. But I do think that they feel there's a read-through there that the class of drugs has this potential to really advance endocrine therapy.

If you were to design an adjuvant study today, how would you do it?

We talk about this a lot. Not 100% sure. I think what you -- I think the monotherapy, at least in the in the moderate to severe risk adjuvant population, I think that the monotherapy is not what you would study in the future. You would probably pick a CDK4/6 inhibitor and combine with a CERAN if we were to use palazestrant and go against the AI in the context of that CDK4/6 inhibitor, right? I think that then becomes, well, is that verzenio? Is that kisqali. Verzenio has diarrhea as a side effect, adjuvant is very sensitive to quality of life because you're treating a lot of patients who don't need it. So in that respect, the ribo, the kisqali 400 is pretty well tolerated. I mean I think that's the direction you go in.

Is it feasible for a biotech company to conduct an adjuvant study?

Yes, if they have $1 billion plus laying around, I think it's absolutely feasible. I think the interest actually would be quite high in the current environment or if you have a collaborator with deep pockets or something like that, I think you could do it. It is extensive. It's thousands of patients. It will take a while. The interim readout is really impressive actually. I mean that shortened the time line a lot. And that's why people got surprised, right, by the result coming out. So it is feasible to do. I think there's definitely interest so that you could execute the trial -- the design, you would have to finalize that. And then I think as well, it is expensive.

Well, you have kicked off the frontline metastatic trial, which is also expensive in its own right, the OPERA-02 study. I guess outline the details of that study and how Novartis is collaborating to help with some of the cost on that?

Yes. So that is exactly as you said, it's endocrine-sensitive first-line setting. So most of the patients that go on that trial have had adjuvant therapy and completed it, completed their 5 years, had at least a year disease-free off of therapy, and then they present with metastatic disease. The other -- that's probably around 70% of patients. The other 30% will be the de novo metastatic. These are patients whose initial presentation of breast cancer, it has metastasized. So they haven't had prior treatment. It's very simple. The patients are randomized to ribo plus an AI, letrozole. That's the global standard of care for first-line metastatic, ER-positive HER2-negative breast cancer. The experimental arm is substituting for the AI palazestrant. And so this is a blinded placebo-controlled trial. No one knows the treatment assignments and the PFS primary endpoint. It's about 1,000 patients. The soonest it could read out would be 2028. I think it's fairly likely, particularly if we get the treatment effects we saw post CDK4/6 that it may take longer to accumulate those events. It's enrolling very well. And I think the data that we have supporting it from the Phase II setting, both tolerability-wise and efficacy-wise is compelling.

I think we're all feeling pretty good about the superiority of oral SERD CERAN over AI after lidERA, how do you think about the potential impact of the CDK combo partner for lack of a better term, washing away that superiority though?

Yes. I kind of confused where that idea even comes from. CDK4/6 is all targeted agents other than endocrine agents on their own are very weak in terms of efficacy. It is really the combination with the endocrine agent that synergizes to bring out that efficacy. And so I think that the concept of a washout of treatment effect is, I think, misplaced. There are complexities going from lidERA to persevERA. And to me, it has more to do with the patient population. So if you think about both settings, their ESR1 wild type 95%-ish. They're endocrine sensitive because even if you've had the adjuvant therapy going into persevERA, you had to be able to complete it and have a year disease-free after. The adjuvant setting, they're endocrine naive. They've never seen any treatment for breast cancer. The majority of the patients, as I said, probably about 70%. I'm sure when Roche presents the data, not in the PR, but when they present the data, they'll tell you how many patients were post adjuvant. But that majority of patients thus adjuvant is not endocrine naive, right? It's not endocrine resistant, but it has seen prior endocrine therapy. So I think that will be an interesting wrinkle that is a bit hard to handicap. A Post lidERA, you have to increase your probability of success for persevERA. I think that's a true statement, but it's not perfect.

And that's the other question, is persevERA a definitive test as you see it? Because obviously, you're running a very similar study that enrolling patients and spending resources on to complete after we've got that data. if it's successful, obviously, that's a great idea and you're well ahead of time. If it's not successful, how do you think about it?

Yes. So another way of putting that is what do we see as the liability of giredestrant. And the liability of giredestrant is its dose, 30 milligrams. Giredestrant is a complete estrogen receptor antagonist as well from a molecular standpoint. It's a very comparable compound in the laboratory setting. The challenge giredestrant had is that when they combined their original recommended Phase II dose, which was on 100 milligrams with palbociclib, they got an enhancement of bradycardia. And the way that Roche decided to address that was to lower the dose of giredestrant to 30. So threefold lowering of dose, threefold lowering of exposure and also with a shorter half-life than we have with palazestrant. And so I think that was our concern about the property of the molecule versus what palazestrant has done -- as well where you can compare across trials with similar populations, palazestrant outperforms. Now that caveat said, it did very well in lidERA, the 30-milligram dose. So it clearly has activity over an AI. We view the persevERA result as, first of all, having 3 possible outcomes. One is obviously positive. Within the negative, there are kind of 2 outcomes. There's sort of overlapping curves. You really don't see anything or you see a trend, but it didn't quite make it to positivity in the trial design. And that seems the more likely way to fail post-lidERA. In any case, we think it is below the efficacy boundary that we would see with the OPERA-02 regimen of ribo plus 90 milligrams of palazestrant. And so we view -- they're completely overlapping would be somewhat confusing result. The other two say to us, we've got a great chance, and we are very excited about what's happening with OPERA-02.

Yes. Well, in terms of the completely overlapping, I mean, everyone still references the persevERA study where fulvestrant was run in a Phase II and that had overlapping over AI. My sense is there's kind of this all roads lead to persevERA dynamic where people are doing a lot of work getting constructive on the idea of post-lidERA, but can't get past that data point. I'd like to hear from you why you don't see [indiscernible] as a strong surrogate for a study like persevERA or your own OPERA-02?

Well, I mean, the first reason is that fulvestrant is just a terrible drug. It's a really interesting molecular tool compound as a CERAN. But its inability to be given orally, it's inability to achieve real exposure is a significant liability. Giredestrant at 30 milligrams, I talked about our concerns about its exposure. It's extremely high compared to fulvestrant. So it's definitely engaging the receptor much more thoroughly than fulvestrant does. The reason parts of what confuses people is [ FALCON ] because [ FALCON's ] interpreted and statistically with p-value 0.049 was positive, but its treatment effect is negligible. Fulvestrant just really isn't that much better than an AI. What you see in lidERA is something completely different. you see the AI soundly beaten with a compelling hazard ratio, I think a very interesting trend towards survival. That looks to me like a matter of time for Roche. And so it is really a different result. It's a bit sad that people are so caught up in [indiscernible] to me right now. There is something interesting about [indiscernible] though. If you look at CDK4/6 plus AI, and remember, for PFS, they were all quite similar. It was sort of 2 years in change, 27, 28 months was the median PFS you could expect. In [indiscernible], the control arm was 32. That's a lot. That's a big 4-, 5-month difference for the same control arm. So it really makes me wonder what is the modern day performance of an AI with a CDK4/6. There's a long history in oncology of a given regimen evolving toward a better outcome. And part of that is probably ancillary supportive care things. Part of it is oncologists are very good at optimizing a regimen when they get more experience with it. And so I think it would be very interesting in persevERA to see how the control arm actually performs.

Okay. I'll spend some time on the monotherapy Phase III. You're running one with the benefit of having seen maybe 6 Phase II/IIIs in the same setting with similar drugs, albeit potentially inferior drugs before you. What key features from those trials have you pulled to set up OPERA-01 for the highest probability success?

Yes. So we've pulled some, but not like uniquely, right? Others have -- the trial that most influences that setting by far is EMERALD, the first one, elacestrant, Orserdu, positive in the ESR1 mutant subset with a fairly weak, right, sort of 2 to 4 months median PFS difference, but real. And of course, that drug is a SERM, it's not a CERAN, so we think compromised molecularly on its ability to fully maximize. They did some amazing things though, out of that trial, did a lot of really interesting retrospective post-hoc analysis and shared them. And we learned a couple of things. One, if you've had chemo, you probably got -- you've probably got very aggressive diseases. It could be very hard with a targeted therapy to go back and capture, significant effect. So you exclude prior chemotherapy. The other thing is that this ESR1 wild-type population post CDK4/6 plus AI is probably heterogeneous. There are some patients in there that are truly endocrine resistant. They have developed -- probably developed mutations that bypass the estrogen receptor. They're not using it anymore. There are others that are still relying on the estrogen receptor as one of the growth and proliferation drivers. So what you want to do is try to some extent to exclude those patients where the estrogen receptor is in factor anymore. And what we do -- what others have done is we require at least 6 months freedom from progression on the prior endocrine therapy. So those are some of the things that we have learned there. Otherwise, there are some sort of trial conduct matters, but it's kind of minutia for the outcome. It's important for generating good data.

Yes. And I guess I wanted to ask somewhat similar to that. The selection criteria because it's always that question of with the palazestrant monotherapy, you're only hitting the endocrine therapy pathway. These patients with ESR1 wild-type population that probably even with that selection criteria, not a lot of ER-driven biology still and those cancers are a question of that. So how do you think about that and the ability to really extract monotherapy activity in the wild-type patients?

Yes. I first would argue that, that's probably not true. You have to understand, it's very interesting. There's a circular aspect, and we also think about this with prostate cancer, where you don't call it endocrine-resistant, but you call it castration-resistant, but it's the same thing. You define this resistance by the therapy you give. So if your therapy is inadequate, you said, oh, they're endocrine resistant. They're not endocrine resistant. They're AI resistant, right? Or androgen receptor antagonist resistant. The pathway is still working. You just haven't fully hit it yet. So I would argue that in a more heavily pretreated patient population, second, third line plus or minus chemo, we didn't use this 6 months. In Phase II, in the ESR1 wild-type subset, we saw a median of 5.5 months. That exceeds what others have seen in the mutant setting. So if we can recapitulate that, I mean, first of all, clearly, there's a significant subset that are still using the estrogen receptor. And then beyond that, if that can be recapitulated, that would be a compelling therapeutic option.

A lot of physicians like to use combinations in second line. So how do you ensure that patients get access to palazestrant combinations when the initial label would be just for monotherapy?

Yes. I mean that's a reimbursement question. That's a little ways off, although we're heading in that direction. We probably started with that already. What we're seeing currently is that the agents that are used, for instance, CDK4/6s tend to be used in multiple lines. The data is not that strong actually. But 30% of our patients in our post-CDK4/6 experience with ribo and pala had 2 prior CDK4/6 inhibitors. which means somebody switch CDK4/6s and then added fulvestrant and did that. We see that quite commonly, it's reimbursed. It isn't actually a label indication. So we think access in cancer is probably pretty good. It raises a question, though, which is should we study the combination in the second, third-line setting, and that's something we are evaluating, specifically ribociclib plus palazestrant. If you saw 1 year, and that was more than 9 months in the wild type, almost 14 in the ESR1 mutant. If you saw that as a treatment option in the second, third-line setting with a well-tolerated combination regimen, that would be a very attractive treatment option. And the question is, should we go back and study that more, and we're evaluating that now.

Okay. And maybe one question on the KAT6 because you...

Can I add one thing about that? What's interesting about going from to that 1 year is the second, third-line setting, if you're able to capture the whole group of patients is a $5 billion-plus market. If you turn around and do a trial where you say, okay, actually, it's not 6 months, it's a year. It's a $10 billion market. So the impact of duration of therapy on market size is direct, right? So this is a pretty extraordinary opportunity for a company with about a $2 billion market cap. First line is more than $10 billion on its own, but these things are really meaningful also from the standpoint of revenue opportunity.

Okay. The KAT6 question, do you think that you can differentiate on just the molecule of KAT6 versus Pfizer's KAT6? Or is the differentiation potentially coming from combination with palazestrant where the competitor is running with a fulvestrant combination?

Yes. I think the answer there, and we'll show the data, but the potential answer there is kind of yes, both. We saw -- there was an interesting announcement from Pfizer right ahead of JPM, which is they were very excited to announce that they were putting a KAT6/7 more selective molecule into Phase I. Well, that's great. It's about 18 months behind OP-3136 and you can't combine with palazestrant. And so we're very excited about the direction in which we're heading. And we think that you have to remember for the Phase III dose that was selected for Pfizer 5 milligrams for their KAT6 inhibitor, they have about 50% dose reduction due to toxicity, which is significant. So if you can address that, get better exposure, you have the opportunity for better efficacy down the road, too. You have to generate the data, obviously, but that's -- we're going to start to show people in late Q2. Pfizer did a great thing. They validated this target. They were the first to get there. I think that the data they have, particularly in combination with fulvestrant, 38% response rate is quite compelling. But we do think there are many opportunities to improve upon that. And this is common, right, in oncology. The first one often isn't the best one. You learn a lot, you're able to help patients, but you refine as you go.

Okay. Well, Sean, unfortunately, we're out of time. Thank you so much for joining us, and thanks, everyone, for listening in.

Thank you.