Takeda Pharmaceutical Company Limited (4502) Earnings Call Transcript & Summary

And now, please welcome Director Investor Relations, Elizabeth Borgeson.

Thanks. Good evening, everyone. Thanks for joining us on our mobo call today. This is Elizabeth Borgeson. I'm a part of the Takeda Investor Relations team working out in New York City. Before we get started, let me cover the safe harbor statement on the next slide. I'd like to remind everyone that we'll be discussing forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those discussed today. The factors that could cause our actual results to differ materially are discussed in the most recent Form 20-F and in our other SEC filings. Please also refer to the important notice on Page 2 of the presentation. Next slide, please. All right. And without further ado, I'd like to introduce Teresa Bitetti. Teresa is the President of our Global Oncology Business Unit. Take it away, Teresa.

Great. Thank you, Elizabeth. Good morning, good afternoon, good evening. Thank you for joining us today. We certainly know how busy everyone is, and appreciate your attendance here. We are pleased to have the opportunity to share new data on mobocertinib that was presented earlier today at World Lung, and to answer any questions that you have around our data and our clinical development plan. I'm joined today by Chris Arendt, who's our Head of Oncology R&D. So welcome, Chris. Now as we move to our agenda slide, I'd like to open by setting some context on Takeda Oncology. Then I will hand it over to Chris for a deeper dive on mobocertinib data, and then we'll close out and open up the lines for your questions. So before we dig into the data, on our next slide, I think it's important to share Takeda Oncology's mission and approach. Our mission at Takeda Oncology, and it is the very heart of what we do, is that we aspire to cure cancer. And we do that through leveraging scientific innovation and keeping a laser beam focused on the needs of patients. Our foundation has been set by our leadership in both hem and solid tumors. Our focus is on harnessing innate immunity. And we have a partnership model that allows us to source innovation, not just from within our own labs, but from external sources, such as academia and biotech. Now as we move to the next slide, the success of this approach is reflected in the breadth and depth of our early-stage pipeline. All of these molecules, which represent mechanisms that are unique and differentiated and they have the opportunity to be transformative. And today, we will focus on mobocertinib, which is one of our later-stage investigational therapies. I would draw your attention to the 3 boxes at the bottom of this slide. Channeling into our early pipeline or what we consider to be industry-leading platforms and partnerships focused on cutting-edge opportunities that include novel innate immune modulators and cell platforms, a multi payload oncolytic virus, an innovative multi-specific biologics, including immune engagers. And now moving to the next slide, let's narrow the focus, specifically on mobocertinib, which is an oral medicine developed and designed specifically to target tumors with EGFR Exon 20 mutations. So why is this so important? The unmet need for these patients is urgent. They represent 1% to 2% of lung cancer patients, and the current treatment options simply aren't doing the job. Most of these patients will receive chemotherapy, which is suboptimal, with response rates of less than 15% and disease progression within 3 to 5 months. And unfortunately, treatment with EGFR-TKIs and immunotherapy have also shown minimal benefit. So suffice it to say that while we are very excited by our scientific innovation, we're most excited about the potential benefit and hope the mobocertinib extends to patients. So now I'm going to turn it over to Chris, who is going to take us through the mobocertinib data. So over to you, Chris.

Fantastic. Thank you so much, Teresa, and warm greetings to everyone joining us today for this meeting. It's a great privilege to have you making time for this session at the end -- at the tail end of what's been, I'm sure, a very busy work week. So without further ado, let me start with a summary on the next slide, please, of the single-arm Phase I and II study that we were very thrilled to be presenting this week at the World Lung Congress. And that serves as the basis for our current U.S. submission for 160 milligrams, once-daily oral mobocertinib, where the primary endpoint is overall response rate. As I'm sure you're aware, mobocertinib has been granted breakthrough designation by the FDA for Exon 20 insertion metastatic non-small cell lung cancer following progression on platinum chemotherapy. So given this designation and in close consultation with the FDA, our submission is inclusive of data from all of the platinum pretreated patients across our Phase I and II study arms, which make up what we refer to as the PPP cohort, so the platinum pretreated patients cohort, and you'll hear us using that shorthand throughout the course of today's meeting. So the PPP cohort, let me explain to you how that -- how those 140 patients in total were derived from, in fact, 3 parts of the study shown here. You can see on the left, the top 2 red boxes that delineate the dose escalation and the initial expansion cohorts with a combined total of 28 PPP patients and then part 3, which is the EXCLAIM extension cohort from which we can derive 86 PPP patients out of the total of 96 patients that were in EXCLAIM. So if I could have the next slide, please. Here we've captured and summarized in one place for you, the results from our most recent data cut. So this is our November data cut. It represents the analysis that's being included in our U.S. submission. And just as a reminder, again, this is the 114-patient pooled platinum pretreated cohort, who received once-daily orally administered mobocertinib. So let me walk you through this and start with the top row, which is time on treatment. You can see that the overall average was just over 7 months so far. And also notably that the range observed in the square brackets was, in fact, quite broad, up to 34 months, which reflects that parts 1 and 2 of the study have now been ongoing for quite some time. So moving next to the next line with the objective response rate, you can see that this was 35% by investigator assessment and 28% by independent review, which represents our primary registrational endpoint. We were extremely encouraged to see in this relapsed refractory population a disease control rate of 78%, which demonstrates that meaning clinical benefit was achieved in the majority of patients receiving oral mobocertinib. Of course, this is a patient population, as Teresa summarized through today, have no approved targeted therapy for their disease and who have extremely poor outcomes following relapse on standard of care chemotherapies. Also captured here are the latest median progression-free survival and median duration of response estimates at 7.3 months and 17.5 months, respectively. I will go into these in a bit more detail on the next slide. So if I could please have the next slide, where we've captured here the median PFS plot for the PPP cohort based on IRC assessment. Now I want to point out that these data were derived from our May data cut, the data shown on that plot. And we now have, hot off the press, the results from our November data cut. And as you can see noted to the right of the graph here, we have confirmed that the median PFS continues to hold steady at 7.3 months in that November data cut. So I hope you can appreciate just how different this Kaplan-Meier plot looks when compared to the much more devastating cliff configuration, if you will, that typifies outcomes for these Exon 20 patients with metastatic non-small cell lung cancer following their progression on current standard of care. We can get so used to looking at graphs like this in the cancer field that we can sometimes forget that each one of these hatch marks, in fact, represents a precious human life, a life that we now have the opportunity to impact in a significant way by addressing the underlying genetic aberration, leading to tumor progression. And that's something our teams and our partners throughout the world are just incredibly passionate about and very, very excited about when it came to seeing the latest data here. So let me move next, please, to the next slide where we're showing also data from the May data cut in this graph. It's the duration of response estimates. And in fact, we were absolutely thrilled to see these data taking shape in the manner that they have with the estimate from May of 17.5 months for median duration of response. And then in our latest November data cut, seeing this number hold up with some additional events. And in fact, seeing the data set mature to the point where we can now estimate the upper boundary of the confidence interval, you can see on the right at 20.3 months, which reflects, in fact, the maturing of this data set. What we're hearing from our investigators, as you can imagine, is that these results are incredibly encouraging, if not stunning. In terms of what this essentially 1.5 years can mean for patients who have such a devastating subtype of lung cancer to be able to provide them with an oral-targeted therapy that has the potential to elicit responses of substantial durability. If I could please have the next slide. Here is another important facet of the lives of these patients. And it relates to several important quality of life associated outcomes that were captured in the EXCLAIM study that we performed. These are data from our May data cut and then cover the full EXCLAIM cohort, all 96 patients, where these evaluations were performed. So let me walk you through what these data reveal. And I wanted to just remind that the lower scores in each of these graphs are more favorable. What we see here are improvements across core lung cancer symptoms, including dyspnea, coughing and chest pain compared to baseline assessments, which you can see there on the line, the red line. So all across this cohort, what we observed were clinically meaningful improvements in all 3 of these symptoms, starting from approximately cycle 2, which is also at the time when we start to see responses initiate. And so a very nice correlation between the symptomology profiles and response kinetics. And very encouraging to see that these improvements were maintained over most of the treatment course. Now at the individual level, more than half of patients experienced an improvement in at least one of these symptoms during their treatment. A key point that may not be fully appreciated is that these patients are managing not only the burden of a cancer diagnosis, but also these other symptomologies on a day-to-day basis that go hand-in-hand with their disease and that otherwise can very significantly impact their quality of life. So on the next slide, please. Here, we've summarized the treatment associated adverse events that have been observed with mobocertinib to date. The observed profile of once-daily mobocertinib is constant with our earlier study data and broadly consistent with the class effects that are associated with EGFR tyrosine kinase inhibitors more broadly, notably with regard to the gastrointestinal treatment-related AEs. It's important to appreciate that physicians treating patients with EGFR Class TKIs have significant experience in managing treatment-emergent GIAs. Keep in mind that this is -- represents, in fact, a very common mutation when you consider EGFR broadly across the lung cancer segment. So a lot of experience going back many years across this class. And what we've seen with mobocertinib is that the majority of treatment-related adverse events are grade 1 or 2 and are managed by supportive care. At the same time, we've established a management plan to address grade 3 diarrhea to minimize dose reductions and treatment discontinuations. Now of note, these guidelines were included in an amendment that occurred at the tail end of the EXCLAIM study. And for this reason, the PPP cohort data incompletely reflect this protocol adjustment or the full impact of it. Overall, we are pleased to have in place now a comprehensive management strategy that allows patients and practitioners to be as proactive as possible in managing side effects and in keeping patients on mobocertinib, something that we know has been very successfully achieved in this study based on the duration of responses that we've seen. So with that brings me to my final summary slide, please, which speaks here to our commitment to advancing mobocertinib as an oral therapy developed to specifically target EGFR Exon 20 onco driver mutations. We're very much looking forward to completing U.S. submission in the coming months based on the data that I've shared today, with potential for approval in the second half of our fiscal year '21. We're also very pleased to have received breakthrough designation from China, and we will be providing further updates on our global registrational strategies at a future time, as we aim to provide patients in this underserved population with the first oral therapy designed to selectively target their disease. Meanwhile, we continue to very much maintain a science and a data-driven focus on identifying additional patient populations with critical needs and where mobocertinib has transformative potential. Following emerging data and science in a field like oncology, of course, requires us to remain nimble. And with this, we've taken a decision not to advance studies in HER2 onco driver settings, which has been planned in combination with HER2 ADCs based on supportive preclinical data that we have generated. Since then, we've seen quite impressive emerging results with HER2 ADCs in the monotherapy setting, which is absolutely fantastic news for patients, and which has, in turn, informed our decision not to move forward with studies in HER2 cancers. Now a key focus, I'd say an area of laser focus for us, remains understanding and maximizing the potential of mobocertinib in the front line Exon 20 non-small cell lung cancer treatment setting. As an update here, we have a new expansion cohort ongoing that is evaluating the combination of chemotherapy plus mobocertinib in the front line. And we plan to evaluate these data in comparison to early frontline monotherapy results with a futility analysis added to our EXCLAIM 2 study to ensure that we advance the most promising approach for patients who stand to benefit from mobocertinib in the first line of therapy. So with that, I'd like to conclude by thanking all of the patients and family members and care takers as well as all the practitioners, investigators, our global collaborators, our incredibly hard working and driven team members who have made it possible to share these important data with the broader community this week. The importance of achieving durable responses for people living with this complex and devastating disease cannot be overstated, and we are incredibly encouraged and energized by the results that we have shared this week. So with that, thank you again for your attention, and I'm going to hand it back now to Teresa to close out the presentation and to kick-off our question-and-answer session.

Great. Thank you, Chris. So now having heard from Chris, here are the key takeaways. First, the unmet need is high and mobocertinib represents an oral option for patients that's specifically developed and designed to address EGFR Exon 20 mutations. Secondly, our second line mobocertinib data shows clinically meaningful improvements over current treatments, and IRC response rate of 28%, a median PFS of 7.3 months and importantly, a durability of response close to 1.5 years, with 17.5 months. The safety profile is manageable, well-characterized and with effects that oncologists are well versed in managing. And I will close by saying that we are looking forward to submitting these data to the FDA and moving the promise of mobocertinib closer to patients. So now I'm going to ask Chris Arendt to join me and also to introduce Dion Warren, who is the Head of our Takeda Oncology U.S. business, who will join us here to help answer your questions. So I will turn it over to Elizabeth.

Thanks, Teresa. Before we start the Q&A session, I want to remind everyone that Takeda is currently in a quiet period leading up to our Q3 earnings call, which is February 4. With that said, I want to ask folks to focus their questions on mobo as we won't be able to answer questions about the company financials and the strategy. With that, Andrea, could you please open up the lines for Q&A?

Absolutely. [Operator Instructions] Our first question, we have from Stacy Ku from Cowen.

Stacy Ku from Cowen. I have a few. First, a question on the AEs. Could you comment on the GI tolerability? Were there any improvements into the November data cut since you commented on kind of the management that took place later in the study? Second question is, how should we be thinking about the recently filed competitor? Were there any amivantamab-experienced patients enrolled into the Phase II study, if you can make any comments there? And then third, how should we be thinking about any kind of companion diagnostic for better diagnosis?

Great. Thank you, Stacy. I'm going to ask Chris to address the AE question and then also whether there were any ami patients that may have been enrolled in that study. And then Dion, if you could address our companion diagnostic plans.

Terrific. Well, thanks. Let me start then. Thanks for the question, Stacy. To my knowledge, we didn't have any amivantamab-experienced patients enrolled in the study data that we're sharing. So let me address some of the inferences we can make and provide some of the framework around that AE data package. I wanted to start by just reminding that we're incredibly encouraged by the efficacy results that we have obtained, seeing this improved -- continuing improvement and maturation of the duration of response data. It's obviously unlike anything currently available to patients in this kind of post platinum treatment setting. And that being able to see in our study data, that sustained durability also speaks to sustained usage and benefit as we've captured so many years of experience in treating GI-associated AEs with this very broad class of EGFRs, collectively a class that's bringing enormous benefits to a very large segment of the non-small cell patient population. So we've -- as captured, we've put in place some very clear guidelines for supportive care. Those were implemented towards the end of that EXCLAIM study enrollment. What we can say is that EXCLAIM, we can see that the discontinuation rate, at least numerically in EXCLAIM at 10% is trending lower than for that broader PPP cohort, which you'll recall included those earlier study parts 1 and 2. The discontinuation rate there was 17%. So we consider that, obviously, to be very encouraging. The fact that most diarrhea is grade 1 and 2 and manageable, very encouraging as well. And then that piece about the quality of life equation. It's just such a critical piece. You've got the efficacy with the durability that matters perhaps the most to patients and physicians, that seeing the disease control rate at 80% almost and then seeing that 1.5 years of durability, a manageable safety profile, a familiar safety profile and then the quality of life associated readouts that we think are also a very important piece. Put that together with an orally available therapy that doesn't require hospital visits for infusions, that's important, even more meaningful in the kind of time we're living in today with a global pandemic, and I think we have a very compelling solution for patients. I'll hand it over with that to you, Dion, please?

Good morning. I will pick up on the question regarding the diagnostics. So diagnostics and patient finding is an absolute aerial focus for us to make sure we can identify the patients that can potentially benefit. So a couple of things are happening here. Number one, we're working very closely with Thermo Fisher and their Oncomine Dx Test will be included within our label as part of our initial launch. Also, we announced last year a robust expansive collaboration with foundation [indiscernible] spaces in the U.S., to pursue companion diagnostics for both tissue and liquid. And so that effort is ongoing, and we would be able to bring that forward in collaboration with Foundation Medicine.

Great. I would just add to that, too, that's going to be very important that patients get tested and that physicians start looking for this because there hasn't really been a treatment for this before. But now that we will be launching mobo, it's imperative that the physicians get access ideally to NGS testing, which would have a higher rate of pickup on the Exon 20 than PCR. And so that's something we'll be working to educate the physicians and make patients aware.

Our next question will come from Hidemaru Yamaguchi of Citigroup.

This is Hidemaru Yamaguchi from Citi. Couple of questions. The first one is that I have been looking at the data a few years of your EXCLAIM data set. And I remember used to be ORR rate -- range was like 54, 45 and trending a little bit lower so far. And I'm not saying this is -- I think it still is very high, but the fact that ORR trend has been lowering over the past clinical trial by adding patients. Is there any reason for that? That's the first one. The second one is a -- I understand is a BTD, breakthrough designated, and ready to be filed, which is really good news. But at the same time, the fact that the competitor filed with BTD, and I heard from the industry people that if the BTD is filed in the same space, sometimes the following BTD is canceled because it's no longer BTD. But this case, it's very close. So is there risk? Is there any regulatory risk or that the BTD will be canceled? And that's the second one. And the third one is that just looking on to ORR, there are difference between your ORR and competitor's ORR. But at the same time, duration response of your product is really, really low, and it's oral. So -- because it's such a common question from investors, can you clearly state in the position of your product compared to recent filed bispecific?

Great. Well, thank you for being up early to join us from Japan. Much appreciated. So you've got 3 questions there. I'm going to -- I'll take the first one -- the question around breakthrough. We are not concerned about losing our breakthrough status based on the [indiscernible]. And then for the question around the ORR with the trend lowering as well as the position in the overall data, I'm going to turn that over to Chris.

Thanks very much, and good morning. Thanks for the question on the sort of profile, the evolving profile of the molecule. And we would say, it's important to reflect on the fact that there's investigator-assessed ORR, of course, and then there's IRC-assessed. When you look -- and so we want to share both of those numbers very transparently. We shared today that the investigator number was 35%. We find that to be broadly comparable to the sort of data we had seen earlier in the earlier patient cohorts. What is new is the duration of response data and how that is looking to be quite promising. And seeing that mature, I would say, speaks to a very profound facet of the data that is really now emergent from the latest data cuts. So with that, I think feeling quite confident that this profile is not only holding up but, in fact, yielding additional insights that have important value to patients as shared. And just to add to what Teresa had captured there on the breakthrough designation piece, we're working extremely closely with the FDA, obviously, taking advantage of the chance for a very close interface, which is what the value of that designation offers to us. So certainly, I just wanted to confirm, we're very much engaged in those conversations that leverage the full value of that designation.

Andrea, can we go to the next question, please?

Yes. I will unmute [ Tim Griffin ].

I just have one question on this EGFR Exon 20. Do you have any estimates of what the patient population is like for this -- for potential treatment with this compound?

Well, thanks for the question, [ Tim ]. I'm assuming it's sort of -- you're referring to sort of what is the general standard of care today, if I understand your question correctly.

I'm more interested in the patient population. How many people have gone to the hospitals and been diagnosed with this specific lung cancer condition?

Okay. Actually, I'm going to turn that over to Dion, just if you can speak to sort of some of the data in the U.S.

Absolutely, Teresa. So specifically in the U.S., we see roughly 4,000 patients newly diagnosed per year in the first -- rather newly diagnosed setting as well as in the later lines. And we're really excited about the data set that was presented at WCLC and specifically the almost 1.5 years duration of response, which as that comes forward to patients, will allow patients to live longer and create additional opportunities for patients to benefit throughout the course of the disease.

I will now ask Kazuaki Hashiguchi to unmute.

I'm Kazuaki Hashiguchi from Daiwa Securities. Well, as clinical trials for additional indication, others or Exon 20, expected to begin? Is it after the development of EGFR Exon 20 has run its course? Or is it possible to start developing new indications by the end of 2021? If so, what kind of indication would it study before?

Thank you for the question and for being with us early as well. We will be exploring mobocertinib in the first line. And as Chris had mentioned that, at the moment, we will not be pursuing HER2. But we will obviously continue to be open to other areas in which we think that there may be value for patients with mobocertinib. But at the moment, right now, the additional study that we'll be conducting is in the first line.

And we actually don't have any more questions right now. [Operator Instructions] Okay. It looks like we have a few more, so please stand by. Okay. We have Stephen Barker.

Stephen Barker from Jefferies Securities. To follow up with the -- regarding the -- your change of plans regarding development for further indications. Does that affect the forecast revenue range that you indicated in your R&D meeting back in November? On -- what assumptions underlie that guidance you offered at that time?

So I'll take that question, Stephen. Thank you. It does not change the guidance that we gave back in December. I think as you remember from that presentation, we had guided of $300 million to $600 million. And we remain confident as we now see the clinical data confirming that this is a very efficacious drug that it does have a long durability of response, that is addressing an oral [indiscernible] need, which is important to patients and that the unmet need is there in the marketplace. We're remaining with the forecast that we gave back in December.

We have next on the line, Shinichiro Muraoka.

It's Shinichiro Muraoka of Morgan Stanley. Can you hear me?

Yes, we can.

Great. One question. So in terms of your competitor, amivantamab, they showed the recent interesting combination with TKI. And according to their press release, they showed 100% ORR. So my question is, so do you have any such combination treatment strategy for your TAK-788?

So I will -- I'll answer that, and Chris, feel free to chime in if I miss a point here. We will be looking at and are looking at a dose-ranging study now for mobocertinib with chemotherapy in first line. I believe the study that you're referring to may have been with another TKI, which was in a different patient population, if I'm correct. But Chris, maybe you or Dion could clarify that.

No, you captured it perfectly, Teresa. So that's right. I mean at the present time, where we had been contemplating that kind of, if you will, a modality combination wasn't in the HER2-positive space, we certainly remain open to interesting opportunities that may yet arise for other types of combinations. And certainly, we'll be exploring any that appear attractive as much as possible, generating the preclinical data, et cetera.

[Operator Instructions] And with that being said, I will unmute [ Tim Griffin ] to ask another question.

Sorry to -- apologies for being -- asking another question.

No, we like the interest, Tim. We like the interest.

I'm curious, is -- in terms of the diagnostics around identifying people with this condition, have you developed anything? Are you partnering with anyone to develop the diagnostics on this front? Or how is that progressing, I guess, is my question.

Yes. No, I'll start and then turn that over to Dion. Obviously, the diagnosis is going to be very important so that physicians are able to identify these patients. Which I think, in many cases, before, there was less of a need to because there was not therapy in which to treat them. And so this is something that we are very much focused on. And I'll let Dion elaborate on our plans there.

Thanks, Teresa. And [ Tim ], as Teresa was saying, a really key area of focus for us is diagnostics and appropriate education. We have 2 significant partnerships to help in this way. Number one is with Thermo Fisher and their Oncomine Dx Test. This will be included as part of our initial submission and registration package in the U.S. The second significant collaboration is with Foundation Medicine, who is a leader in the diagnostics space in the United States, as you know. And we are very actively pursuing 2 additional companion diagnostics. One focus on tissue and the other on liquid. And we are working very closely with Foundation Medicine to move those forward as well. So I hope that addresses your question, [ Tim ].

All right. And with that, we'll close out the call. If you could go to the next slide, please. Just want to thank everyone for joining. And just remind you that we do have some upcoming events, starting with our earnings call that will be on February 4. So hopefully, you can join us for that. If you do have any questions that did not get answered tonight, on the next slide, there's an e-mail to be able to contact the IR group or reach out to us directly, and we'd be happy to walk you through anything that we missed. So with that, thanks for everyone joining, and have a great weekend.

Thank you.

Thank you.

Thank you, everybody.