Relay Therapeutics, Inc. (RLAY) Earnings Call Transcript & Summary

All right. Good morning, everyone. Thank you so much for attending. My name is Zaki Molvi. I'm an associate on Akash Tewari's team. And I'm here with the Relay Therapeutics team. We've got Sanjiv and Pete. I'll let them give some opening remarks, and then we'll get into Q&A.

Thanks, Zaki. Thanks to Jefferies for the invite, and thanks to all of you for attending this morning. I think as we've been doing all year, we're in execution mode. We are heads down now executing Phase III with our asset RLY-2608, which is a PI3K-alpha mutant selective inhibitor. We believe to be the first in the clinic. We're excited about the progress that we're making there. Behind that, we're doing all the work to look at the various triplet regimens that we could potentially use in earlier lines of treatment in breast cancer. And then we've commenced dosing patients with PI3K-alpha-driven vascular malformations. And so behind that, we have NRAS-selective asset as well as the Fabry asset. We have close to $600 million on our balance sheet, and we're excited to generate value over the coming years.

Awesome. So I guess, I think at ASCO, we saw your updated data. We've got a 39% ORR that continues to mature from the last cut, 10.3 month PFS, 11 months in pure second line. But we're also seeing the other PI3K alphas, the SERDs, the KAT6s looks like 5 to 7.5 months. I think just to level set, I think what people want to understand is what's going to be the right competitive bar in second-line plus setting? And how much -- how confident you are that, that 10 months will -- understanding that it may degrade, may not in a larger Phase III, will that still land in a place that's competitive relative to those?

Yes. It's a question that's really been circulating over the last year, 1.5 years because there's so many different mechanisms of action that have read out. And obviously, the hope of all these different mechanisms, KAT6, oral SERDs, CDK4/6 retreatment, some of the nonselective pathway inhibitors was that you could improve that 5.5 to 7 months' worth of PFS. And unfortunately, what we've seen is nobody has been able to move that bar. And even more interestingly, the bar could have actually been lowered. And so capivasertib was approved a couple of years ago now with actually a lower PFS than alpelisib, the current that was approved prior to that. And capivasertib has taken significant market share and is on a run rate now of $800 million annually just because it has a perceived better safety profile than alpelisib. And so although we haven't seen the bar move from 5.5 to 7 months, we actually may have seen it actually decline. And so we feel pretty confident sitting on a 10-month PFS, even with some degradation that we will be successful in the second line.

Got it. And I mean, for that second-line study for ReDiscover-2, you're going head-to-head versus Capi, which I think is great, makes a lot of sense. And I think just looking at the way you've powered the study, I feel like you are kind of powered for at least maybe 2, 2.5 months delta over Capi. I mean, is that kind of a fair assumption that you're making internally?

Look, I think we want to make sure that we have a successful trial against capivasertib, but we want to make sure that it's also going to be commercially viable. And so yes, we think somewhere between 2 and 3 months is the minimum that you'd want. As we sit today, it's 10 months PFS across all lines. It's a pretty robust data set now, over 60 patients, over 12 months' worth of follow-up. And so in second line only patients were at 11 months. So we believe that as many people point out, there could be some degradation in the real-world trial that we run across multiple geographies. But we still feel pretty confident that we'll be able to clear the hurdle.

Got it. And in terms of, I think, the dose, you announced earlier that you'd be going with a 400 mg BID fed dose, whereas the previous data that we saw was 600 mg fasted. And I think you've shown pretty nicely that it looks like the PK coverage is relatively similar, if not even maybe a little bit better just with the fed dose. But one thing is when I looked at the CAPItello study, right, we know Truqap on the label, it doesn't have a particular restriction. But when I looked at the CAPItello study, I think at that time, it was a recommendation of fasting before the dose. So I mean, how do you think this kind of compares? How will this data set be comparable if you're now going to fed?

Yes. So you're correct. We did notice a food effect with 2608, moved to 400-milligram BID fed, very similar exposures. These are exposures that get us on average about IC90 target coverage throughout the dosing interval. And then interestingly with Capi because of the tolerability profile, they had to move to intermittent dosing, so dosed 4 days on, 3 days off. And the label is agnostic to food. So I don't think -- we don't anticipate that being a challenge at all in the study that we will be asking patients to eat. It can be anything, low fat diet, high fat. It doesn't really matter what it is, just getting some food into the system. And it's very convenient because it's a BID dosing. So take it with breakfast, take it with dinner, and it shouldn't be an issue.

Got it. And actually, on kind of the diet part, in terms of the hyperglycemia, right, you guys have shown, I think, lower -- generally lower hyperglycemia rates than the other PI3K alphas, but definitely, it's still a class effect with hyperglycemia. And what can you tell us about for ReDiscover-2, there will be monitoring of fasting glucose. I mean, how will patients be monitored? And with the Fed regimen, will that have any kind of effect or artifact on hyperglycemia?

We don't anticipate the fed dosing having any impact on the amount of hyperglycemia we'll see with 2608. In the study itself, we don't require at-home glucose monitoring for 2608. And Capi would be administered per label in the study. And they recently had -- I guess about 9 months ago now, they've updated their label to require at-home glucose monitoring. So those patients will need to -- per protocol will be asked to monitor their glucose because that is what the label requirement is for Capi. And the reason why that is -- in the clinical study in CAPItello, you saw a numerically lower hyperglycemia Grade 3 rate. But like I said, Capi is dosed 4 days on, 3 days off. They were measuring glucose at the end of the 3-day drug holiday. And we believe that, that artificially lowered the perceived hyperglycemia rate. And I think you're seeing that come to bear in the real world where they're now having a label update to require glucose monitoring.

Right. Got it. Makes sense. And in terms of -- we have -- there's another PI3K-alpha in the room, right, with the Scorpion Lilly molecule. And it's funny at ESMO, we saw -- I think even before ESMO, last time we talked, you mentioned that you've actually looked at that Scorpion molecule yourself and done kind of the in vitro coverage tests. And it seemed like their 100-milligram dose was just starting to touch the coverage that you were getting with your 400 mg go-forward dose. And now we have some 100-milligram data from ESMO, where it actually looks like their doublet data numerically very similar 40% ORR, the triplet, it looks like there's like 4 patients at that dose, like 3 out of 4, 75%. Who knows really until the data matures. But I mean, do you feel like that thesis is -- I mean, how should we look at the Scorpion data now that we have some idea of them at kind of comparable doses?

I mean I think it's the thing that we all look forward to. I mean there's a lot of speculation around the profile and how it could be significantly better than the current standard of care, including 2608. I think the data that came out was still very difficult to interpret. It was early. And I think that's the key thing, which is, yes, I mean, the numbers you stated were true. But if you really look at the confirmed responses, they were 0 in the triplet. And I think most of the doublet responses are also unconfirmed. So I think the only thing that we could really go away with on the efficacy side is still early, maybe it could get close to 2608, but we've set a pretty high bar at 39% ORR and 10 months of PFS. I think the one thing that you can tell for certain from the data from ESMO is there is some unknowns around the toxicity profile. And so in their monotherapy that they showed back in 2024, there was an LFT signal. Clearly, they showed Grade 3 LFTs. And at that point, it was really only kind of less than 2 months' worth of follow-up. And I think the narrative then it was only at high doses. Now in this data set, they ticked out the high doses above 100 milligrams and that LFT signal doubled. And so we're seeing in the doublet 37% all grade LFTs increasing and then over 10% Grade 3. And that's close to now at 4 months' worth of follow-up. And they didn't break it out by dose. So you imagine that if you follow the narrative from the year before that those were higher at the 100 milligrams. So I think the real key question is on the efficacy is they could potentially get close to us at the 100 milligrams. The real question is, is it tolerable? And we'll find out over time. But the signals that we saw on the LFTs are definitely concerning.

Right. And to be clear, for your molecule so far in LFTs, we're out of the weeds there. And so I want to talk a little bit about triplet setting as well, right? Because you partnered with Pfizer to kind of run the triplet study with Atirmo. But we've already gotten a little taste of kind of PI3K-alpha mutant selective triplet data from Celcuity, right? They have gedatolisib triplet data. It looks like 14.6 month PFS in mutant. I mean, are you kind of looking at that as a potential preview of what this mechanism can do in the triplet setting? And how are you viewing that other than the efficacy, the other profile otherwise in terms of the IV dosing compared to you?

I think we were all thrilled to see the Celcuity data readout in the wild type. It was a positive trial. There's just so few options for wild-type patients that I think it is definitely a win. I think the question is unknown on the mutant side. It's a small number of patients that they showed the 14 months in. And so again, back to the question of how will that read out in a large multicenter Phase III. We'll find out, I think, in 2026. The real question is just going to be, again, how tolerable is this profile going to be. I think in the data that we've seen, you need multiple drugs here in the triplet to support it. You need dexamethasone mouthwash. You may need medications for the rash. So it's just potentially a 4- to 5- drug regimen, and it's an IV administration. And obviously, these are chronic therapies in a [indiscernible] oral market. So I do think there are some questions even if it does hit on the mutant to the commercial potential of this product versus an oral and the profile of 2608.

Got it. That makes sense. And also, we also have the Roche triplet data as well. It looks like coming in at a very similar PFS with a 15-month PFS. But I think you guys also have the ability to differentiate on safety. I mean, should we be thinking about triplet as like the bar for efficacy is going to be a 15-month PFS with generally cleaner hyperglycemia rates? I mean help us frame that.

Yes. So I mean you hit the nail on the head, and that is very mechanism validating data. They ran a very elegant study in frontline endocrine-resistant patients. It was a bit of a contrived patient population and that they had to go into very metabolically fit patients to mediate the hyperglycemia risk. But nonetheless, they proved that if you can thread the therapeutic needle and actually get patients to stay on that study and hit the target, you can have a pretty profound benefit. And we now see that they have an OS benefit. So that was very confirming to us on the commercial potential that we should think about for ourselves in the frontline setting. And yes, our goal is to move forward with a triplet in a frontline study. There's 2 open questions there is which triplet to move forward with and which study to run. But we feel very confident that once we get there, there's probably very high POS on that trial.

Right. And I think one of the things that -- as we talk about hyperglycemia, one of the things that you've done and you're doing it in ReDiscover-2 is the A1c criteria, under 7%, the fasting glucose, also upper threshold 140. And I think the discussions at SABCS had kind of talked about this as one way that you had kind of potentially limited the risk of seeing events. But how should we think about if the study is going to be run in that population, how is it going to look on the label? And then how might the risk be managed for a broader population that does include people with higher A1Cs?

Yes. I think over time, you'll see us test the hypothesis of going into higher A1c patients. Because we know that the data we generate, both in our current ongoing second-line trial and eventually the frontline trial we run, we know it's likely going to be compared against the different trials that Roche is running with inavolisib, which has very restricted metabolic criteria. The place to test that hypothesis is probably not inside these Phase III studies. We still by the entry criteria we have, these are prediabetic patients, anything over 6 is going to be considered prediabetic. In our Phase I/II experience, we had 1/3 of our patients either with a BMI greater than 30 or in the prediabetic range as it concerns HbA1c and fasting plasma glucose. So I think we could eventually run that experiment over time. I don't think it's the proper one to run inside of these studies given the cross-trial comparisons that folks will make in the future.

Right. That makes a lot of sense, right? The idea is you want to keep things consistent. We've seen these encouraging signals so far. And I think the idea is you want to be as best positioned as possible to kind of replicate these early signals that we've seen. To that point, I think one of the things that we were talking about as we discussed this 10-month PFS signal in the second line plus and then kind of replicating higher than that in the first line. Is there anything that you're doing kind of in recruiting for the Phase IIIs in terms of using repeat centers? Anything to kind of ensure reasonable limitations on the -- how much PFS might degrade?

So the key thing is the -- in the ReDiscover study, the Phase I/II, we had about 50% of our patients were third line plus. Over half of them had seen prior either oral SERD or fulvestrant. 1/3 of the patients had prior chemotherapy. Just by definition, as we move into this Phase III where we're putting a bit more restrictions on the number of prior therapies, we're likely going to see healthier patients, more predominantly second-line patients. And so I think completely agree with you that historically going from Phase I/II single-arm studies into large Phase IIIs, you should anticipate a bit of a degradation in the PFS you've seen. We probably get a little bit of balance in the other direction in that regard because we're moving -- we will control a bit more the amount of pretreatment that these patients have seen.

Right. Got it. Makes sense. And in terms of -- I think in your data, I wonder if there's -- we've talked about these kind of other experiments to kind of run. You've seen in your kinase mutation cohorts like an 18-month PFS in the second-line setting, which I think is kind of an intriguing signal. Do you think there's room to kind of say like potentially running a trial to confirm that signal? And I mean, is there an opportunity there?

I think we believe that we have a pan-mutant inhibitor on our hands in 2608. So sure, the data that we showed was -- at 18 months was, we think a high watermark. We think it's going to be over 12 months. But we also think that we have a molecule that covers the helical and so we're running the trial to try and get the approval across all mutations.

Got it. And now I want to talk a little bit about the vascular malformations opportunity. You're running an interesting trial there. We've already had the EPIK-P1, EPIK-P2 data from Novartis. It's funny, the EPIK-P1 data, right, they showed kind of like a 38% ORR, which kind of in the EPIK-P2, they did half that dose and they saw pretty much half the ORR, but also half the Grade 3 AEs. So I mean -- and also some KOL work that we did suggest EPIK-P2 is a little bit less severe patients, maybe not the ideal patient population. I know you are running a study where you're doing kind of an interesting 3 plus 3 dose escalation. So it looks like you can kind of get to more effective doses more quickly. But I mean, tell me a little bit more about how you're taking the learnings from those alpelisib trials that Novartis ran and incorporating them into your vascular malformations study.

Maybe I'll start and Pete, you can finish off. So those of you who are not familiar, vascular malformations is a significant opportunity driven by PI3K-alpha mutations. The only approved agent at the moment has accelerated approval is Novartis' alpelisib. And the studies that you cited here, one was the accelerated approval that got the approval and then the confirmatory trial unfortunately failed. And so there's plenty of precedent here for us to kind of work through as we figure out what the best pathway for us is. Maybe, Pete, you can just talk about the design.

Yes. So because of the experience we have of 2608 in oncology, you're right, we can -- instead of going through the traditional dose escalation, we're actually doing dose randomization across 3 doses simultaneously. And those -- each of those doses -- each of those arms could be up to 15 patients each. So it is a bit more efficient development. We'll -- the highest dose in that randomization will be the oncology Phase III dose. And the open question here is what level of target coverage do we need to really affect maximum efficacy in these patients while maintaining a good tolerability profile. We get a little bit of an understanding of that relationship between target coverage and efficacy, as you point out from alpelisib, they used 250 milligrams in the label dose, which is about the strangest approval you'll ever see. It was based off of retrospective chart review of patients treated under compassionate use across 7 centers. There is no dose finding or justification done there. And that's why investigators in the confirmatory study required them to go to half the dose. And so I think it's difficult to really understand the safety profile of alpelisib at that 250 dose because that safety data was collected through retrospective chart review of compassionate use patients. It wasn't in the rigor of a clinical study. And then the confounding factor of the EPIK-P2, like you said, it's done at half the dose. And so it's barely -- probably barely touching the PI3K-alpha pathway, the mutants from a target coverage standpoint. And so I think it will be interesting to see the profile over time. But yes, the clear goal here is better efficacy, better tolerability, get to these patients as early as we can in their disease progression. This is a somatic mutation that happens in utero, and the goal would be to treat patients as early in development as we can chronically. And I think that's the profile we'll be looking for as we continue to test this clinically.

Right. And in terms of -- I think one of the concerns investors want to know is how quickly will we eventually get data on this because these are smaller trials, take longer to enroll than the oncology trials. So when are we really going to be able to see some proof-of-concept efficacy there?

It's a great question. It's one of the things that frustrates folks is that we are not giving guidance on any of our programs at the moment. And it's really out of interest for shareholders to make sure that when we do give guidance, it's with a really solid understanding that we'll have robust and interpretable data in hand. We're very happy with how the conduct of the study is going, the excitement amongst investigators, the pace of enrollment. We're just not quite there yet to feel comfortable giving guidance to when we could share that data. But rest assured, when we do, it will be the data set that we view to be interpretable and really informative for the ultimate next steps that we would pursue here.

The cash window that we have of close to $600 million in cash runway into 2029 allows us just to go out and execute. And so as you see in this window, we'll have the Phase III that we're running ReDiscover-2. We'll have the triplet data that we've talked about, and then we'll obviously have this VM, vascular malformations data as well as bringing the Fabry and NRAS program into the clinic. So there's plenty of catalysts ahead. I think the key at the moment is we're just not guiding to when.

Right. And I think having that data eventually is something that investors should wait for because it's 170,000 patients across all of the types of vascular malformations. I think one thing I want to hit on is, are there going to be subsets that you think might be the optimal responders? Because you look in the literature, you see, okay, there's different mutational burdens, patients who -- some patients whose disease relies more so on PI3K-alpha mutations than others, genetic mosaicism. I mean, do you think the trial program, when you do have that data, will be able to elucidate how big the opportunity is going to be?

I think the initial data will start to answer that question. It won't be the complete answer. Our view is that any of these patients with PIK3CA mutated disease should be responsive to a PI3K-alpha mutant selective inhibitor. You're correct. There's other -- biologically, there's other things happening inside of these lesions. But we do think that in the mutated patients, that is happening in an otherwise very quiet genome. And it's not like cancer where you have polyclonal disease that we do believe the PIK3CA mutation is driving this disease. There are some other mutations that we believe do happen in these patients. TIE2, for instance, is one of them, but we think that's mutually exclusive to the PIK3CA mutant patients.

Right. And one thing we noticed is there's only a few centers where there are specialists for vascular malformations. So when you think about this 170,000 number, I guess, are there -- is it commonplace to get PIK3CA testing? I mean, will those patients know that they are eligible for an inhibitor?

I mean I think in the PROS and the lymphatic malformations is a clinical diagnosis because 100% of patients with PROS have a PI3K-alpha mutation and close to 80% in lymphatic malformations. And so I do think that, that allows these patients to be treated much more rapidly. But there is a significant amount of testing that goes on here in both populations.

Got it. And with that, we are out of time. Thank you all so much for attending.