Summit Therapeutics Inc. (SMMT) Earnings Call Transcript & Summary

Hi. Good afternoon, everyone. Welcome to the 43rd Annual JPMorgan Healthcare Conference. My name is Denise Liu. I'm an associate here on the JPMorgan Healthcare Investment Banking team. Today, it's my pleasure to introduce the Summit Therapeutics team. We're excited to be here with Dr. Maky Zanganeh, CEO and President. We'll have time for Q&A at the end of the presentation and we'll also be joined by Bob Duggan, CEO and Chairman; Manmeet Soni, COO and CFO; Dave Gancarz, Chief Business and Strategy Officer; and Dr. Allen Yang, Chief Medical Officer. So with that, I'll turn it over to Dr. Zanganeh.

Thank you so much. Good afternoon. Thank you very much for being here today. I would like to thank JPMorgan team and especially Mike Gaito for inviting us today. I'm Maky Zanganeh, the Chief Executive Officer and President of Summit Therapeutics. Last year was an incredible year, and I'm proud for all of our achievements. When we presented last year at JPMorgan, our value was -- market cap was $1.8 billion. And today, the last that I saw was around 13 -- over $13 billion. We presented our excellent results of ivonescimab in multiple conferences, matching and, in some cases, exceeding our expectation. This molecule has shown the potential to become a game-changing treatment option for patients with solid tumors. We are just at the beginning of this incredible journey. It's an honor and obligation to bring this product in hand of many patients in need. We have access to money. We have access to a lot of professional team, and you can count on us. I believe by now, all of you, you memorized the forward-looking statement. I don't need to go over that. We are a mission-focused company. I'm honored to lead alongside our Chairman and Co-CEO, Bob Duggan. Bob and I have worked together for over 25 years, and our track record clearly shows extraordinary results no matter how you measure it across multiple health care organizations. Our leadership team comes from a diverse background with a proven track record and known for their high-speed execution. We have approximately 175 employees. Our main purpose is to make a significant difference for patients diagnosed with cancer. We are focused on those whose lives have been interrupted by the uncertainty and torment of cancer and dream of returning to normal life one day. Our goal through our development of our groundbreaking product candidate, ivonescimab, is to become an ally to patients and physicians to bring back the magic of normal to those who have lost it. Let's review our achievements in 2024. With our extraordinary Chinese-based partner, Akeso, we are rapidly developing ivonescimab in multiple therapeutic area in solid tumors. As of today, we announced, initiated or completed 9 Phase III trials between Summit and Akeso. Last June at ASCO 2024, the first randomized Phase III study result, HARMONi-A, were presented in the second-line plus EGFR-mutated non-small cell lung cancer. This data supported the approval of ivonescimab in China. Last September, at the World Conference on Lung Cancer, our partner, Akeso, presented the result of the HARMONi-2 trial, which is a monotherapy ivo versus pembro in frontline PD-L1 positive advanced non-small cell lung cancer. This was, of course, the first randomized Phase III study to go head-to-head against pembro, the world's best-selling oncology drug. And we showed a decisive, statistically significant benefit in the trial's primary endpoint. Last September at ESMO 2024, ASCO presented several Phase II data update, including 5 studies outside of advanced non-small cell lung cancer. Our broad Phase III program reflects the strong Phase II data that has been generated in both lung cancer and way beyond non-small cell lung cancer. Last October, Summit completed the enrollment of the first global Phase III study evaluating ivonescimab, HARMONi. Top line data from this study is expected in the middle of this year. And depending on the timing of the events and given that occurs, it would allow us to file by the end of the year -- of this year. Let's talk about our financial. Our stock performed particularly well in 2024, gaining more than 580% based on data and events we presented last year. And we believe this is just the beginning of the opportunity that we can deliver given our belief in the potential of ivonescimab. Last year, we raised $435 million. I would like to take this opportunity to thank our investors for believing in us as well as our key insiders who participated in the most recent round of investment. As you can see, our confidence in ivonescimab remains strong, and we are doing everything possible to deliver this drug in the hand of patients in need. As of December 31, our cash balance is in excess of $410 million. We have no debt. We remain well positioned to take on these expanding large opportunities to develop ivonescimab broadly and deeply. Let's start to talk about ivonescimab, about the mechanism of action, I believe by now, all of you knows about ivonescimab. It is a first-in-class PD-1 VEGF bispecific antibody that was intentionally designed and specifically engineered to improve upon the safety and efficacy standards of 2 established targets. The cooperative binding property of ivonescimab increased the binding strength of each target in the presence of the other target in vitro. In other words, cooperative binding allows for strong simultaneously blocking of both PD-1 and VEGF, which are present at their highest concentration in and around the tumor. Ivonescimab not only performs the function of both an anti-PD-1 agent and anti-VEGF antibody, but it optimizes the activity of both in such a unique way. It is effectively a unique mechanism of action from anything developing historically. This specific engineering was not accidental, and this intentional design cannot be easily replicated. Modifying this intentionally engineered property may change the dynamic value-add characteristic that we believe have led to the clinical trial result today with ivonescimab. To date, excluding -- sorry, with over 2,300 patients treated with ivonescimab, let's review in more details the current pipeline and where data has been and is being generated for ivonescimab. As mentioned in my previous slide, 9 Phase III studies, which have been completed, are enrolling or will begin the enrollment between Summit and Akeso team. Akeso has either launched or announced its intention for additional 3 Phase III clinical studies outside of non-small cell lung cancer: studies in head and neck cancer, biliary tract cancer, which are currently enrolling; and a study in pancreatic cancer, which will begin. A significant amount of additional data is being generated in other indications, including breast cancer, colorectal cancer, ovarian cancer, gastric cancer and hepatocellular carcinoma. As I said, excluding any commercial sale by our partner, Akeso, 2,300 patients have been treated. 9 Phase III clinical trials are currently enrolling, starting enrollment or fully enrolled. In addition, several Phase II trials provide significant breadth and depth of data. In total, as of today, we have 31 sponsored study combined across Summit and Akeso in non-small cell lung cancer and other solid tumors. We presented 14 publications in 7 tumor types as well as 5 oral presentations at major conferences in 2024. As you can see, in the future year, we intend to rapidly develop ivonescimab along with our partner at Akeso across solid tumors indications. As I explained in my previous slide, it's all of the Akeso clinical trials. At Summit, beyond our 3 Phase III program in lung cancer, we intend to expand our clinical trials for ivonescimab outside non-small cell lung cancer further with more details to come later this year. We have approved over 30 investigator-sponsored trials, which will either enhance our sponsored clinical development activities or can show signals in setting where Akeso has not yet had the opportunity to explore. In 2024, we have started our collaboration with the University of Texas, MD Anderson Cancer Center, which now has studies that are activated and open for enrollment in Houston. We have committed $15 million to this collaboration to quickly discover additional opportunity for ivonescimab, including several tumor settings outside of its current development plan as well as the possibility of identifying biomarkers through additional research activities. Zooming in on the current non-small cell lung cancer Phase III program for ivonescimab. We have initiated 3 global Phase III clinical trials in multiple non-small cell lung cancer setting. We have the approval of ivonescimab in China in 2024 based on the result of HARMONi-A study. This was followed by the landscape-shifting result of HARMONi-2, where ivonescimab became the first drug to show decisive superiority to pembro in a Phase III trial. Akeso has submitted in China for approval in the PD-L1 positive first-line non-small cell lung cancer setting with monotherapy ivonescimab based on the HARMONi-2 trial result. Akeso also continued to enroll its HARMONi-6 study against another anti-PD-1 in combination with chemo in first-line lung cancer in China. At Summit, we have 3 Phase III study on the global scale. HARMONi is very similar to the HARMONi-A trial in second plus line EGFR mutant non-small cell lung cancer, which we completed enrolling, and top line data is expected in the middle of this year. This is our fast-to-market strategy, which could allow for a BLA filing in the U.S. later this year, depending on the result of the data once available. HARMONi-7 was launched in frontline non-small cell lung cancer for patients with tumors with high PD-L1 expression based on the outstanding result from HARMONi-2. And finally, we are enrolling in HARMONi-3 global studies in frontline non-small cell lung cancer in combination with chemotherapy compared to pembro plus chemo. This represents a significant unmet medical need across over 100,000 patients in the United States alone as this cover frontline non-small cell lung cancer patients without genomic mutation irrespective of histology or PD-L1 results. Starting in frontline lung cancer, 4 of the 6 studies conducted by either Summit or Akeso are head-to-head against a checkpoint inhibitor, 3 of which are directly comparing ivonescimab with or without chemo to pembro with or without chemo. Let's take a look at the data from HARMONi-2 that was so groundbreaking from last September that inform our HARMONi-7 study as well as the expansion of our HARMONi-3 study, which now include both squamous and non-squamous patients, significantly increasing the potential of addressable market. The design for HARMONi-2. HARMONi-2 is a randomized double-blind clinical trial evaluating frontline monotherapy ivonescimab as compared to monotherapy pembro in patients with locally advanced or metastatic non-small cell lung cancer with positive PD-L1 expression. This is a single-agent multicenter Phase III clinical trial conducted and sponsored by Akeso in China. Our partner at Akeso generated and analyzed the data. The primary endpoint of progression-free survival by blinded independent radiologic review committee for the entire study at the time of the first planned interim analysis with a median follow-up of 8.67 months, demonstrating a significant improvement for ivonescimab with a hazard ratio of 0.51, corresponding to 49% improvement over pembro. The median PFS was 11.1 months versus 5.8 months in the ivonescimab and pembro arm, respectively. You can see the median improvement is significant. The curve begin to separate at the first point of radiographic assessment and maintain separation over the entire duration of the follow-up thus far. And the hazard ratio and the p-value leave no doubt as to the difference between these 2 therapy options for progression-free survival in this study. Now let's focus for a minute on the patient with PD-L1 high-expressing tumors that is so important to the Western treatment paradigm. While the analysis of subgroup revealed that the PFS benefit with ivonescimab was observed across nearly all subgroups, it actually showed a particularly strong signal as measured by stratified hazard ratios in the PD-L1 high-expressing subgroup. The curve again separate immediately and continue to widen as time progressed, which is an important characteristic as we evaluate this study. As monotherapy checkpoint inhibitor is a standard of care for patients with high PD-L expression in the Western markets, we have initiated our HARMONi-7 study in this population in part based off the strong Phase III data. As I mentioned, the result of HARMONi-2 also supported our decision and enthusiasm to expand our HARMONi-3 study to enroll patients of both histology. You can see from the data on this slide that the benefit was similar for patients irrespective of histology. The result from patients with squamous non-small cell lung cancer showed a hazard ratio of 0.48 favoring ivonescimab, and those with non-squamous tumors showed a hazard ratio of 0.54. The current slide and previous slide represent a strong indicator that the benefit in HARMONi-2 was seen across clinical subgroups and underscores that the success of the trial overall was not driven by an especially strong performance of one subgroup. Let's talk about the safety. Ivonescimab demonstrated its tolerability in the HARMONi-2 study. Most importantly, there were very few patients that experienced treatment discontinuation or treatment-related adverse events leading to death and both value of which were numeric higher in the pembro arm. Yes, we see that there were somewhat comparable but numerically higher rate of serious treatment-related adverse event with ivonescimab, 20.8% compared to 16.1%. Importantly, however, nearly all of the higher rate of treatment-related adverse events were lab-related abnormality such as hypertension and proteinuria, but generally did not lead to discontinuation of dosing. They are manageable conditions that are often seen by oncologists. As a result of the successful HARMONi-2 study and our analysis of their underlying data, here is the design of our HARMONi-7, a randomized global Phase III study evaluating ivonescimab versus pembro, both monotherapy in frontline non-small cell lung cancer with tumor with high PD-L1 expression population. This study will begin enrolling in early 2025. HARMONi-7 has 2 primary endpoints: progression-free survival and overall survival. That is our HARMONi-3 trial that was initiated about a year ago in frontline squamous non-small cell lung cancer patients. Starting with squamous patients because anti-PD-1 therapy was generally less effective in squamous lung cancer patients versus non-squamous and because Avastin largely could not be used to treat patients with squamous lung cancer due to safety concern, primarily serious bleeding risk. The Phase II data produced by Akeso showed very promising efficacy data alongside what appear to be an improved safety profile in the context of anti-VEGF therapies in this setting, the safety profile which was revalidated in the HARMONi-2 trial. We felt that the data gave us a mandate to move very quickly in developing ivonescimab in squamous non-small cell lung cancer last year. The HARMONi-2 result made it clear that we needed to pursue the monotherapy setting, which is now the HARMONi-7 trial I just described, but the benefit seen was consistent across histology. So ivonescimab also had transformational opportunity in squamous non-small cell lung cancer, which compelled us to move forward to benefit those patients in need. There are also significantly more patients with metastatic non-squamous non-small cell lung cancer as compared to squamous, nearly double in the U.S. alone, bringing the addressable patient population of HARMONi-3 to nearly 100,000 in the United States. Therefore, you can see the amended study designed for HARMONi-3 that now includes squamous and non-squamous patients, we will be testing for PFS and OS as primary endpoints and will stratify by histology as well. We completed the enrollment of our global HARMONi trial a couple of months ago, and we expect to read out the result of this trial in the middle of this year for those patients with non-small cell lung cancer with EGFR mutation having progressed and standard of care targeted therapy. Akeso completed, has since received regulatory approval in China for HARMONi-A study. The primary difference are that we require patients to progress on a third-generation EGFR TKI in the global HARMONi study. Also, more than 85% of HARMONi-A patients received a third-generation TKI. And secondly, the HARMONi-A study had a PFS primary endpoint and our HARMONi study has a dual primary endpoint, which is PFS and OS. Importantly, as we have previously discussed, we prespecified to include all of the patients from HARMONi-A who previously received a third-generation EGFR TKI, so a vast majority of the patients in our global HARMONi study. As we anticipate the result of our HARMONi study, let's quickly review the results for HARMONi-A, which was presented at ASCO last year and published at JAMA. The study design of HARMONi-A, as you know, this compared ivonescimab plus chemo to chemo plus placebo for patient post-targeted therapy irrespective of PD-L1 expression. The PFS benefit was significant. The combination of ivonescimab plus chemo representing a 54% reduction in disease progression or death versus chemo alone. Median PFS was 7.1 months for ivonescimab plus chemo versus 4.8 months for placebo plus chemo. The overall response rate and disease control rate numerically favored ivonescimab plus chemo as well. As the study adds an anti-cancer therapy on top of another treatment, you would expect a numerically high rate of adverse events. However, the difference in discontinuation rate was approximately 3% between the 2 arms, and there were no treatment-related death, Grade 3 or higher adverse events of special interest. Immune-related adverse events showed the expected increase versus placebo and potentially VEGF-related adverse events were similar between the arms, and there were no Grade 3 or higher bleeding events seen in either arms. We are excited to review the data, which is expected to be ready in the middle of this year for our HARMONi, the next significant catalyst for ivonescimab, representing the first global data readout for ivonescimab in a Phase III registration-enabling setting. As mentioned before, we are intent to go beyond advanced non-small cell lung cancer in the shorter term with our clinical development of ivonescimab. Let's review a snapshot of some of the data released in the last few months associated with ivonescimab in Phase II study conducted by Akeso in China. Perioperative or early-stage non-small cell lung cancer eligible for surgery plus systemic therapy with pathological responses and 12 months event-free survival metrics in this Phase II study exceeding the established metrics from current standard of care. In microsatellite stable metastatic colorectal cancer, a place where anti-VEGF therapy dominates and PD-1 therapy is largely absent, ivonescimab plus chemo again exceed the historical result seen from the standard of care of Avastin plus chemotherapy. The response rate seen by ivonescimab with chemotherapy, along with the early PFS benchmarks, exceed the current standard of care metrics that include anti-VEGF therapy plus chemo. In PD-L1 positive recurrent metastatic head and neck cancer, a chemo-free option, the Phase II data in China from Akeso combining ivonescimab with Akeso CD47 investigational compound exceed the historical results seen by PD-1 therapy in this setting. In advanced triple-negative breast cancer, we see the trend from lung cancer continuing. PD-1 therapy is only utilized in the PD-L1 high triple-negative breast cancer represented by the gray bars, which ivonescimab Phase II data exceed historical benchmark for response rate and PFS. However, in PD-L1 low and negative triple-negative breast cancer where PD-L1 therapy is not approved, ivonescimab shows very promising results as well, leading to another potential setting where ivonescimab may be effective where PD-1 therapy are not. In each this setting, a manageable safety profile was observed, and you can see that discontinuation from treatment-related adverse events have not been observed as of the cutoff date. You can see more complete presentation of this data on our website. As we look at catalyst event for ivonescimab, we can see 3 main concepts. First, the first global Phase III clinical study data is expected in mid-2025, which provide a potential path applying for marketing authorization in our territory, including potentially the United States. Secondly, we intend to expand our sponsored clinical development plan to go way beyond non-small cell lung cancer in 2025 and 2026, in addition to continuing engagement with a rapidly increasing number of investigators seeking to conduct IST program at various institutions across a large number of different tumor types. This is in addition to Akeso continuing its execution of its Phase III study, including completing the enrollment of HARMONi-6 in frontline non-small cell lung cancer with ivo combined with chemo as well as continuing the enrollment of its biliary tract cancer and head and neck Phase III study. Akeso has announced its intent to explore additional Phase III study beyond lung cancer in '25. In addition, the readout from Phase II and Phase III studies will continue from studies sponsored by Akeso in China throughout 2025 and 2026, which will continue to inform our clinical development plan. The value proposition here is clear, ivonescimab individually has the potential to be a platform blockbuster drug. Ivonescimab is well positioned to make a significant impact across the treatment landscape of non-small cell lung cancer with a combined 6 Phase III study conducted by either Akeso or Summit. Non-small cell lung cancer has an addressable market in lung cancer that could ultimately approach $20 billion for checkpoint inhibitor alone according to the third-party research from the likes of TD Cowen and others. But this is just the start, Chapter 1, if you will. The graphic here shows the 50-plus indications where PD-1, PD-L1 or VEGF therapy have been approved. Ivonescimab will continue to be rapidly tested and its development advanced way beyond non-small cell lung cancer. Just considering checkpoint inhibitor may lead to an addressable market approaching $90 billion globally in the next couple of years according to the IQVIA Institute. But this includes the full impact that ivonescimab can have, where it has shown promising data in multiple tumor types where checkpoint inhibitors have not been effective, including microsatellite stable colorectal cancer, PD-L1 low and negative triple-negative breast cancer and EGFR mutant non-small cell lung cancer after targeted therapy. I would like to take this opportunity to thank mostly our patients in our clinical study as well as our investigator, our collaborator at MD Anderson, our partner in China, Dr. Michelle Xia, our CEO and Co-Founder of Akeso, and we will continue to pave the way for accelerated development of ivonescimab globally. With that, I will show you 1 minute of video, and I will let for Q&A. [Presentation]

Thank you so much. I cannot finish this presentation without asking Bob for a few words.

Thank you, Maky. You did a wonderful job. It's an honor to have Michelle Xia here from Akeso. We spent months working with her and her team to build what we think is an ideal partnership. We're in constant communication. We have great admiration for one another. They do a lot of heavy lifting on the innovation side. We looked at over 100 companies before we chose Akeso, and I'm sure they have their pick of a number of companies before they chose us. It turns out that Michelle had an involvement in IMBRUVICA at Celera, and that was just a tremendous coincidence. But she did have some idea what these people in Silicon Valley could do when you got their hands around a good drug. I will just say also that in addition to Maky on our leadership team, we have a group of people here along with us and back at home. They're just the best of the best. We made an early decision as we transition back into oncology, which is our strong point, to choose the very best people, pay the very best wages and give them the highest of stock options before we had a product. And because of them, we got this product. So if you're ever in doubt when and where do you spend the money, just you've got to be all in and a high purpose and you just don't look back, you just go ahead and do it. So we've -- I really validate the team here. They're just world-class. You can work with bigger pharma companies, but the big people in pharma companies go up and get the next job. And then if they don't get that job, they go to another company. And if they do get it, they retire with their $30 million salaries. We have people really dedicated to the purpose here. Maky has had cancer, was able to win that victory herself. I had a son that had cancer. So we've all had our foot in the door there and we know what it means, and we're just honored and pleased to be in front of you today and show you the progress we're making. And as Maky said, this is Chapter 1. This is just early, and we're going to deliver what we promise. Maky, back to you.

Thank you, Bob. And any questions?

Congratulations on the data. Is there something proprietary about the CrossMAb design in terms of Fc, Fab that confer a particular PK/PD that would prevent a generic VEGF or PD-1 to perform similarly?

I will ask Allen.

Yes. So the question is around the mechanism of action. There's something unique about ivonescimab versus delivering each of those targets individually, let's say, giving pembrolizumab and bevacizumab together separately. So I think people under-appreciate what Akeso was able to engineer. It's really a beautiful molecule. I've been working on bispecifics for over a decade in my career. And what was really unique, besides the fact that these are 2 validated targets, I think what people under-appreciate is that they are designed and engineered in such a way that there's cooperative binding between the ligands. So the binding of PD-1 increases the binding of VEGF and conversely, the binding of VEGF increases the binding of PD-1. So that leads to optimal binding where both ligands are present, which we believe to be the tumor microenvironment. There's another unique feature around the cooperativity, which is it's a tetravalent format: so 2 PD-1 binding sites, 2 VEGF binding sites. And what's well described in the bevacizumab literature, if you bind the VEGF ligand, which is a dimer, you can daisy-chain bevacizumab. And that exact thing is happening with ivonescimab as well. Ivonescimab will bind to VEGF, which will bind to another ivonescimab, which will bind to another VEGF. And that leads to daisy-chaining of ivonescimab. Now once VEGF is bound, you get this high affinity binding of PD-1 presented as well. So you have multiple binding sites as well as tighter binding sites once VEGF is there. And we believe that, that -- sorry, I got the water here. Thanks.

I thought that I'm sick.

Yes. So we believe that this what we call allosteric cooperativity and associated cooperativity, the binding of titer, the multiple binding sites lead to an improvement independent of giving those targets separately. And that's why the ivonescimab molecule is so unique. And as far as I know, most of the other molecules out there have slight variations, but it doesn't have all the features that we're aware of ivonescimab having at this time.

[indiscernible]

Yes. So if this was published in a poster abstract that I think Akeso is preparing as a publication at SITC in 2023, I believe the SITC meeting, there's a poster there. It's on our website.