CTI BioPharma Corp.
Q2 2015 Earnings Call Transcript

Published: 7 Aug 2015

[Operator:]

Good day and welcome to the CTI BioPharma Second Quarter 2015 Financial Results Conference Call. Today’s conference is being record. At this time, I would like to turn the conference over to Monique Greer, Senior Vice President, Corporate Communications and Investor Relations. Please go ahead, ma'am.

[Monique Greer:]

Thanks, Melissa, and welcome everyone to our second quarter 2015 financial results call. The press release reporting our financial results can be found on the homepage and in the Investors Section of our corporate website at ctibiopharma.com. Following formal remarks by management, the conference call will be open for questions. Joining me today are Jim Bianco, President and Chief Executive Officer; Matt Plunkett, Executive Vice President of Corporate Development; Bruce Seeley, Chief Commercial Officer; Lou Bianco, Executive Vice President of Finance; and Jack Singer, our Chief Scientific Officer. Before we begin, please note that during the call, we will be making forward-looking statements based on current expectations. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that may cause actual results to differ materially from those anticipated by the forward-looking statements. Additional information concerning these risks and uncertainties is contained in the press release reporting our financial results for the second quarter 2015 in the Risk Factors section of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015, and in the Company's other periodic reports and filings with the Securities and Exchange Commission. I will now turn the call over to Jim.

[Jim Bianco:]

Thank you, M. Good afternoon, everyone. The first half of this year has been truly remarkable period for CTI. First, with data from the PERSIST-1, a randomized Phase 3 study of pacritinib for patients with myelofibrosis, including those with disease-related anemia and thrombocytopenia, which was unveiled during an oral presentation at most important and largest U.S. oncology congress of the year, the 51st annual meeting of the American Society of Clinical Oncology or ASCO as is called. Dr. Ruben Mesa, one of the co-principal investigators along with Claire Harrison presented the results in an oral presentation at a late-breaking session at the meeting. He presented to a standing-room only audience of over 5,000 attendees, which along with Dr. Mesa’s invitation to participate in ASCO’s press program to cover the results of PERSIST-1 aimed to raise awareness of the pacritinib amongst the oncology community and the public at large. Dr. Mesa’s presentation show that the best - compared to best available therapy, exclusive of a JAK inhibitor, pacritinib therapy resulted in a significantly higher proportion of patients achieving a 35% or greater reduction in spleen volume and a 50% or greater reduction in disease-related symptoms. And these benefits were also observed among the patients with very low levels of blood platelets, the condition called severe or life threatening thrombocytopenia. For those on the call, who are not familiar with thrombocytopenia, normal platelet count range between 150,000 and 400,000 per microliter. In the PERSIST-1 study, 32% of patients had platelet counts less than 100,000 and 16% had platelet counts less than 50,000. Also, at study entry, 46 percent of patients were thrombocytopenic. In addition to disease-related thrombocytopenia, approximately 40% of patients also had disease-related anemia, which is defined as you may know as hemoglobin below 10 grams per deciliter. So, there is clearly an unmet medical need for patients with very low blood platelet counts for whom there are no FDA-approved therapies. So, we believe in the potential pacritinib to provide benefit across the spectrum of myelofibrosis, including patients with what we term compensated marrow function, to those whose disease in fibrosis has progressed to the extent that they become anemic and thrombocytopenic. Two consequences of advanced disease and we believe pacritinib represents a first and the next generation objective therapy for this disease. But, just I’d like to outline a few of the highlights presented by Dr. Mesa. For reference, the press release and Dr. Mesa’s presentations are available on our website. Given the advanced stage of the disease and the degree of illness amongst the patients treated in PERSIST-1, approximately 20% to 25% of patients in each arm didn’t reach the 24-week evaluation time point and came off the study for a variety of disease related - disease associated reasons. For this reason, the evaluable patient population really does provide a better estimate of the treatment of that size than the intent to treat population. So, overall 25% of evaluable patients achieved 35% reduction or greater reduction in spleen volume with the greatest benefit, 33% of the PAC arm compared to none in the BAT arm, which was statistically significant observed in patients with platelet counts below 50,000, a subset that represents a true unmet medical need segment of the myelofibrosis patient community today. Patients with less than 50,000 platelets also experienced a significant improvement in their baseline platelet counts without receiving platelet transfusions when compared to the BAT arm. Importantly, 25% of patients who were severely anemic defined as requiring six or more red cell transfusions in the 90 days prior to study entry became transfusion independent and a number of these patients were also those who had less than 50,000 platelets and similarly in their red cell counts. The only basis by which a patient’s red cell count and their platelet counts increase over time is that the marrow microenvironment is improving, suggesting that pacritinib may be disease modifying, an aspect which raised a fair amount of excitement amongst the KOL community both at ASCO and at the European Hematology meetings or the EHA meetings. As you know, myelofibrosis is the blood cancer with the symptoms can have a tremendous impact on the quality of patients’ daily lives. One of the secondary endpoints in the PERSIST-1 measured patient reported outcomes or PROs whereby patients used the standardized instrument called an e-diary to capture how they felt or functions in relation to their health condition or treatment, including things like fatigue, concentration, early satiety, which is feeling full, inactivity nights with itching, bone pain, abdominal discomfort, weight loss or fevers. Now, patients treated with pacritinib experienced improved patient experience with respect to myelofibrosis-associated symptoms when compared to best available therapy. And in early July, Dr. Mesa revealed the results of patients treated with pacritinib as well as assessments using several other quality of life tools such as Patient Global Impression and Change, which is a patient’s perceptive of their overall health, the ERPC Quality-of-Life instrument C-30, which looks at patient functioning, and symptom scores calculated based on responses to questionnaires presented during an oral session at the European Hematology Association meeting. For all these symptoms discussed in the presentation, pacritinib showed a statistically significant improvement over best available therapy. You may recall the most common adverse event occurring with pacritinib within 24 weeks of any grade were mild to moderate. GI symptoms were the most common adverse event and typical lasts for approximately a week and only a handful of patients discontinued therapy due to the GI side effect. Importantly, there were no grade 4 GI events and the instance of grade 1 to 3 were lower than what we saw in our Phase 2 studies. What encourages most by the results of PERSIST-1 was the dosing intensity or the percent of the actual dose over the recommended dose that a patient receives. More than 99% dose intensity was observed irrespective of the patient’s baseline platelet or red cell count while having therapeutic benefit, a reduction in spleen volume and disease-related symptoms and improvement in transfusion dependency. So, unlike other myeloproliferative neoplasms like polycythemia vera or post-essential thrombocythemia, MF is one of the most aggressive of the MPNs with debilitating symptoms that dramatically reduce patients’ quality of life, with survival from diagnosis still well under a decade. And that has a prevalence of about 18,000 patients in the US and unlike many other blood cancers, MF is a difficult to treat chronic disease and like their patients, physicians struggle to find effective treatments and are always looking for new options, particularly for patients with low platelets who struggle with cytopenias namely thrombocytopenia and anemia as a result of their disease. Within one year following diagnosis, 58% patients will develop anemia and 28% will develop thrombocytopenia with these percentages growing to 64% and 31%, respectively, more than a year from diagnosis. The extent to which MF patients develop disease related to cytopenias is actually greater than what was previously recognized and underscores the need for non-myelosuppressive JAK2 inhibitor to maximize efficacy without having to compromise benefit at the extends of side effects of therapy. We and our partner Baxalta believe that myelofibrosis market is estimated to reach approximately $2 billion by 2020, presenting significant potential. With up to 70% of patients having to discontinue their current therapy or reduce their dose because of treatment related anemia or thrombocytopenia, pacritinib may provide flexibility in simplifying the management of MF for all patients regardless of their platelet counts as a new treatment option. In addition, the lack of myelosuppression makes pacritinib an attractive candidate for investigation in combination therapies such as new targeted agents that are emerging in the search for curative approach to this disease. We have committed to marketing with the agency as we strive to bring this new treatment to patients with myelofibrosis as rapidly possible. We are currently in discussions with the USFDA on regulatory pathways for a submission in the US and as previously stated, we plan to start a regulatory submission for the FDA and/or EMA later this year. Our partner Baxalta, as you may recall, is responsible for the submission of the marketing authorization application to the EMA. You remember pacritinib has Fast Track designation by the FDA for the treatment of intermediate and high risk myelofibrosis that includes, but not limited to patients with disease related thrombocytopenia. I mentioned the patient population that we have enrolled in the PERSIST-1 trial. The Fast Track designation also includes patients experiencing treatment emergent thrombocytopenia on other JAK2 therapy for patients who are intolerant to or whose symptoms are sub-optimally managed on other JAK2 therapy and this is the patient population we are targeting in our PERSIST-2 study. Our goal for the PERSIST program was to evaluate the pacritinib in two randomized Phase 3 trials in patients that would really represent a true mix of what healthcare providers see in their everyday practice, not just better risk patients with normal blood counts, but really the 32% of patients that present a particular challenge to managing their symptoms who have low platelets. While PERSIST-1 focused on a cross section of patients irrespective of blood cell counts, it did exclude patients with prior JAK therapy, which is how the PERSIST-2 trial complements the patient population that we treated in PERSIST-1. You may recall PERSIST-2 is targeting patients whose platelet counts are below 100,000 and this was a population that was excluded from the COMFORT Phase 3 trials. It includes patients with prior JAK2 therapy and allows ruxolitinib to be used as the best available therapy if the physician chooses to do so and the patient is randomized to the BAT arm. The protocol directed dose of ruxolitinib in the BAT arm is per the product label which is a maximum of 20 milligrams per day for patients with platelet counts between 50,000 to 100,000. For the 50% of patients on PERSIST-2 who have platelet counts below 50,000, ruxolitinib is currently not indicated for use. We believe PERSIST-2 has the potential to demonstrate that pacritinib is superior to ruxolitinib in this patient population as well as addressing the significant differences in treatment emergent anemia and thrombocytopenia as seen between these two agents. Pacritinib, as you know, is the next generation multikinase inhibitor with specificity not just for JAK2 and FLT3, but also for two other very exciting targets, IRAK1 and CSF1. And as such, we believe there is a unique opportunity for pacritinib to address a broader patient population than it’s currently being served. Looking beyond myelofibrosis, we believe that pacritinib’s kinase profile suggest its potential therapeutic utility and a spectrum of blood related cancers spanning from AML and MDS to CLL, CML, even mantle cell lymphoma and certain solid tumors where JAK-STAT dysfunction is associated with their disease. A separate preclinical study show pacritinib overrides stroma-mediated resistance in FLT3-ITD positive AML cells which is believed to be an important mechanism of resistance to other FLT3 antagonists in treating that disease. IRAK1 and CSF are becoming the next set of hot targets in immuno-oncology as they are linked to the regulation of tumor microenvironment and the inactivation of several aspects of the new response to tumor antigens. We are confident that together with Baxalta we will be able to more rapidly advance development and availability for pacritinib for patients around the world with myeloproliferative neoplasms in addition to AML and other blood related cancers. So at this time, I am going to introduce Bruce Seeley, our new Chief Commercial Officer who we believe will provide outstanding leadership of the commercial organization more wide. We obviously believe Bruce’s extensive global commercial oncology experience and his demonstrated track record especially launching strong product brands particularly in the blood related cancer space will be extremely valuable as we continue to advance our pre-commercialization and launch activities for pacritinib together with Baxalta, as well as advancing the development of our other late-stage product candidates. So now I would like to ask Bruce to make a few introductory remarks. Bruce?

[Bruce Seeley:]

Thanks, Jim. I am truly excited to be here and I wanted to just share on the call what attracted me to CTI BioPharma. The first with pacritinib, we have a novel therapy that now has data from a randomized Phase 3 trial demonstrating that pacritinib may offer physicians who treat patients with myelofibrosis at choice, no matter where those patients reside in their treatment journey. And I am joining at a time when our team and our partner Baxalta are focused on developing sales and marketing plans, ramping up commercial and medical affairs teams on a globally basis and looking forward to their next indications where pacritinib could best potentially help patients. I also want to say that the caliber and energy of the leadership and the dedication of the people here drew me to CTI. Jim and Jack Singer co-founded this company nearly 25 years ago, the potential near term success of pacritinib, a drug that I believe has blockbuster potential, will be a result of their persistence and vision and the hard work of a team that has always been focused on the patient. My years of experience in building global teams and commercializing drugs in blood cancers, solid tumors and diagnostics allows me to work with this team to help prioritize and drive lifecycle management plan for pacritinib and our other product candidates and I am excited to have this opportunity to contribute to our ongoing and future success. With that, I will turn it over to Matt.

[Matt Plunkett:]

Thank you, Bruce, and welcome, it’s great to have you onboard. I am going to provide a brief update on PIXUVRI and our partnership with Servier. As you know, based on PIXUVRI’s efficacy and safety profile and the clear unmet medical need in aggressive B-cell lymphoma, in 2012, the European Commission granted conditional marketing authorization for PIXUVRI. As we have previously described, in connection with the approval, we are conducting the PIX306 post authorization trial which compares PIXUVRI and rituximab with gemcitabine and rituximab in the setting of aggressive B-cell and HL. PIX306 is intended to support the conversion of our EU conditional marketing authorization to a full approval to extend the PIXUVRI development program to second-line aggressive NHL representing an earlier line of treatment and to include combination therapy with rituximab of the product label. If positive, the results from the PIX306 study may form the basis for a possible submission to FDA in the U.S. Site openings for the European component of the PIX306 confirmatory trial is nearly complete, and patient enrollment has accelerated. We have been targeting completion of enrollment for PIX306 by year-end 2015. Based on slightly slower site openings than expected, we now expect to complete enrollment for this event driven trial in the first quarter of 2016. We believe there is strong potential for the continued use and adoption of PIXUVRI for the treatment of patients with aggressive B-cell lymphoma. One of our challenges to-date has been introducing a monotherapy treatment in Europe where combination therapy is readily used when treating cancer patients. We believe generating data with PIXUVRI in a combination regimen with rituximab will help us move PIXUVRI up to treating patients with second-line and beyond. A number of hematologists in Europe are generating interesting data for PIXUVRI in exploratory investigator-sponsored trials for the treatment of aggressive NHL and we expect to see additional publication of these data in the future. During the quarter, we and our partner Servier participated in three European Congresses and had the opportunity to engage with some of the top-tier hematologists, oncologists from some of the most respected institutions in Europe. Our two companies were well represented at the European Bone Marrow Transplant congress in Istanbul, the European Hematology Association congress, and International Congress on Malignant Lymphoma in Lugano, where we had the opportunity to educate physicians through symposia and other medical education activities and where data from select PIXUVRI investigator-sponsored trials were subsequently published. Our partner Servier, a private company with $5 billion plus in revenue continues to build their PIXUVRI commercial franchise and have started promotional activities in some of the European territories including France, Italy, Ireland, Netherlands and Spain. Servier is expecting reimbursement in most of its European markets by mid-2016. Together, we continue to raise awareness of PIXUVRI in the EU and physician experience with this therapy continues to grow. We believe that having Servier’s commercial and medical teams active in the field will significantly enhance recognition of the power of PIXUVRI in Europe and beyond given their significant resources and the enthusiasm for this drug. Tosedostat is the third promising product candidate that I wanted to briefly mention. Tosedostat is the first-in-class product candidate, an oral inhibitor of aminopeptidase, a family of metalloenzymes that clip and free up amino acids from peptides and polypeptides allowing them to be the building blocks for new proteins essential to tumor cell survival. At EHA in June, data from an investigator-sponsored Phase 2 trial tosedostat in elderly patients with either primary acute myeloid leukemia or AML that has evolved from myelodysplastic syndrome or MDS showed that the combination of tosedostat with low-dose cytarabine/Ara-C resulted in an overall response rate of 54%, with 45% of patients achieving durable complete responses. One of the secondary end points was to identify possible biomarkers associated with sensitivity and/or drug resistance. A gene expression profile was performed on purified AML cells obtained from 29 patients and results showed that the achievement of the complete response to be efficiently predicted by this gene expression profile. In 2014, we acquired worldwide rights to tosedostat and assisted in the initiation of a Phase 2 trial evaluating tosedostat plus low-dose cytarabine for older patients with AML or high-risk MDS that is being conducted by the UK's National Cancer Research Institute AML Cooperative Group. We expect to report whether tosedostat met the initial efficacy hurdle to enter into the Phase 3 component of this so called pick-a-winner trial. Depending on the results, we would plan to consult with the FDA and the EMA regarding potential registrational strategy that could begin as early as 2016. Clearly, tosedostat fits nicely into our portfolio of novel agents, specifically targeting blood related cancers. Now I will turn the call back to Jim to review the financials and upcoming milestones.

[Jim Bianco:]

Thanks, Matt. Total revenues for the second quarter and six months ended June 30, 2015 were $1.1 million and $3.8 million respectively and that compares to $1.3 million and $2.8 million for the same periods last year. PIXUVRI net product revenues for the second quarter were $800,000 which compared to $1.1 million in 2014. The decrease in PIXUVRI sales year-over-year was in part due to fluctuations in the foreign currency exchange as well as some pricing and volume variations between the periods. The GAAP operating loss for the second quarter of 2015 was $31 million, which compared to GAAP operating loss of $26.7 million for the same period last year and the increase in the operating loss is predominantly associated with Phase 3 development program for pacritinib and the PIX306 post-authorization Phase 3 trial. Non-cash share-based compensation expense for the second quarter of 2015 was $2.8 million versus the $5.4 million for the same period in 2014. The net loss for the second quarter of 2015 was $32.6 million or $0.19 per share and that compared to a net loss of $27.4 million or $0.19 per share for the same period in 2014. Turning to our balance sheet, we ended the second quarter with cash and cash equivalents totaling $54.9 million. We have a total outstanding share count of approximately 180.7 million shares. As stated in our Q2 financial results press release today, which can be found on the home page of our website, we are reaffirming our prior financial guidance that we expect total revenues for 2015 to be approximately $50 million to $55 million and we expect non-GAAP operating losses for this year to be approximately $75 million to $85 million. As Bruce mentioned earlier, this is really an excitement time for CTI as we execute on our plan for 2015 and we start to get ready for exciting activities next year in 2016. So in summary, just to give you some of the topline targets for the year, we expect to complete the enrollment of the second Phase 3 trial for PERSIST-2 in the second half of 2015, support Baxalta in their submission of MA8 for pacritinib based on the PERSIST-1 data in late 2015 as well as explore regulatory pathways available to us with the Food and Drug Administration. We will advance our equipment development program in other hematologic malignancies by year end. We’ll complete the enrollment in PIX306 in early 2016. As Matt mentioned, initiate variety of additional studies together with our partner Servier for PIXUVRI and define a registrational account for tosedostat in AML or MDS as early as beginning of next year. So this will conclude our formal presentation, we’ll have the operator to open the call for some questions.

[Operator:]

[Operator Instructions] We’ll take our first question from Charles Duncan with Piper Jaffray.

[Charles Duncan:]

Hi guys, thanks for taking the question and congratulations on a good quarter of progress. My first question was perhaps on PERSIST-2. You said that enrollment was going well and you’re going to complete by year-end I believe. I’m wondering if you can share with us any blinded information on how that trial is going, in particular how do you know that investigators are using ruxolitinib per protocol or the per label, anything else that you can share with us on the patients that have been enrolled.

[Jim Bianco:]

So obviously, good question Charles. I can give you some very general statements about this study, I wouldn’t want to drill down into any of the specifics, we are, as you mentioned blinded to treatment arms. We do track things like data capture from the e-diaries to make sure that we have a complete dataset through the evaluation period of 24 weeks. So from that perspective PERSIST-2 has a much higher completion rate than what we saw in PERSIST-1, obviously the increased diligence of what we learned from PERSIST-1, we are applying to the PERSIST-2 study. You know that half the patients in PERSIST-2 have platelet counts below 50,000, I mentioned that previously. We would not expect to see those patients receiving doses of ruxolitinib. We know that the doses of ruxolitinib that are being used are very low dose for the most part in the 5 to 10 milligram range per day. And so again these are doses that are well below, if you go back to [indiscernible] study. I don’t think, remember this is a dual primary end point, so we don’t see the drugs used being a concern with regards to the potential of the BAT arm to drift to higher treatment effect sizes. Remember, they have to hit both endpoints to be counted and so that means 5 milligrams of rux or 10 milligrams of rux a day, how many of those patients had 24 weeks will still be on that dose because remember they are starting with platelet counts that are 50,000 to 100,000 and we know that even at those doses that the treatment-emergent thrombocytopenia does occur. But more importantly, you’re well below the pharmacodynamic threshold for plasma concentrations to give you the maximum therapeutic benefit that we are seeing for example in the Phase 3 studies at 40 milligrams a day, which was the typical dose that was used at 30 milligrams a day. So that’s just a little color we feel good with the patient profiles, we feel that it’s tracking in the way that we would expect it to track. We like the distribution across geographies. We like the prior ruxolitinib use in terms of about a third of the patients will come in on rux, which is important about a third of the patients have prior rux and no longer being treated with the rux. So it will get a lot of good valuable information from this study and I think it will address a lot of important questions with regard to how to manage the patients right now that the clinical communities really having difficulty managing effectively.

[Charles Duncan:]

That’s helpful Jim, and then going back to I guess the regulatory strategy, it’s pretty clear what’s going to happen in terms of European filing. But when would you anticipate being able to really nail down what the US filing strategy would be? It seems like the results from PERSIST-1 to support that in my opinion, but I am wondering when you think that you will be able to give guidance on the US strategy.

[Jim Bianco:]

We mentioned in the call that we are - we have been encouraged by a lot of the medical communities to have those discussions, so obviously having the discussion doesn’t hurt. It’s provides us some insights and thought processes from the regulatory bodies as well. And since we have a clear direction path answered et cetera, we obviously will make that known at the appropriate time.

[Charles Duncan:]

And then finally, does it still make sense to perhaps file for breakthrough therapy designation in that low platelet count patient population?

[Jim Bianco:]

And Charles, do you want to ride it for us? You’re absolutely welcome to do that. Yeah, we have people that - I mean, this has been a - obviously we’re still a small company in terms of the things that we’re doing in the number of Phase 3 programs, but more importantly, we are working on the NDA timeline getting all those components perfect. So we are in the position to file on a single trial, then we would be ready to do that. If we are not, then we are still under the program that we had to set guidance for which is the two trials requirement, but more importantly Baxter will be in a position to have the MAA submission by year-end. So that’s kind of our focus right now. The answer is yes, it would be nice to have it designated as breakthrough therapy. It’s not going to help us for the particular application that we have right now in terms of speeding the time to approval, but certainly for some of the other indications based on the mechanism, there may be some data that we could use to support it as well.

[Charles Duncan:]

That’s helpful. Thank you for the added color.

[Operator:]

We will take our next question from Bert Hazlett with Ladenburg.

[Bert Hazlett:]

Thank you, and thank you for taking the question. And Jim, I just want to offer that regarding riding the breakthrough therapy you were just talking about, my fees are reasonable, so thank you for taking the question again. Just a question as we try to get a read through from PERSIST-1 to PERSIST-2. As you think about patients that had spleen volume response, are those - is that the same patient generally that also has a response in the patient reported outcome symptoms? Is that the way to think about that around? How much overlap is there in those patient groups?

[Jim Bianco:]

There is a lot of overlap, but the correlation of who got the 35%, who got the 50% doesn’t necessarily happen in the same subset. So just because you had maximum spleen volume response doesn’t necessarily mean that those patients will also hit 50% reduction. And what we saw a little bit of in PERSIST-1 in the low platelet patient populations is they had much bigger baseline spleen, so the treatment effect size was clearly the greatest in that group and I think that that’s pretty comparable with what you’ve seen across the other study that people reported. They have smaller baseline spleen volumes at study entry getting to a 35% reduction is different than if you have a spleen volume of first lien size of 12 centimeters versus somebody who has 15 or 18 or 20 centimeters, a 35% reduction is easier, it appears to be easier to accomplish. But they don’t always call it a 100% with each other - meaning, the same patient hitting both end points. And that’s an important distinction, Bert. I am glad you brought that up. That’s not a requirement for the primary endpoint. A primary endpoint is that the aggregate proportion of patients who reach 35% and the aggregation proportion of patients who reach 50% or greater in TSS reduction is what the end point is based on, not the same patient achieving both end points.

[Bert Hazlett:]

Okay, thank you for that clarity. As we continue - I am sorry, were you - I didn’t mean to interrupt.

[Jim Bianco:]

No, you didn’t. Just, there is good literature there from the COMFORT studies in the summary bases of approval that the FDA did and they will show you at various doses what percentage of patients actually hit both endpoints and when you get down to that 20 milligram or below level zero hitting both. And so again, it just gets back to our comfort level given the type of doses that we are seeing and the probability of the BAT arm doing something abnormal we think is what we are obviously on top of that because if we can patrol for, we will. But we don’t see that as being as much of a risk in the PERSIST-2 studies as some other people have alluded.

[Bert Hazlett:]

Thank you for that color, that’s great. Another question, coming at it a little bit differently. I think we have a sense based on some of the studies, including PERSIST-1 of what patient - how patients might respond with low platelets that are not on rux or not on any JAK2 therapies. We have a sense from other studies about what they - how they might respond if they are on rux. What do we know if anything about patients that are prior JAK experience [ph] that are not currently on JAK2 therapies coming into that we can that can inform our thinking in terms of how that patient group, that sort of patient that you referred to, might perform in PERSIST-2?

[Jim Bianco:]

Right, I mean, in the general literature, there are studies where people have retreated with other JAK2 inhibitors showing that you can still maintain sensitivity, for example at jakafi and fedratinib studies where they did crossover from patients who are on one JAK2 inhibitor and then came off therapy because of either lack of response or progression of their symptoms, but then had a therapeutic benefit from reintroduction of a different class of JAK2 inhibitor. We know from our own Phase 1-2 studies that we’ve had patients with prior JAK2 that that wasn’t a variable that determine whether or not they were going to be sensitive and the only group that you worry about are the true resistant patients and based up on everything that I’ve heard from people like Ross Levine, et cetera, resistance to - true intrinsic resistance to JAK2 is the very rare event, it’s clearly less than 5% or 10% of what they see out here. Jack, do you have any color on that?

[Jack Singer:]

I think the best experience is when they shut down Pacritinib and they cross people over to JAK, there was really no problem with that whatsoever, the response rates were high. There is also retreatment experience with rux patients where they had to come off of it for one reason or another and again they defined. The mutational frequency in the JAK2 gene is very lower than the disease and true mutational resistance is very uncommon. We have anecdotal experience at treating such patients and it looks like they are going to do just fine.

[Bert Hazlett:]

That’s very helpful. Thank you very much for that. And just one more quick one, regarding the characteristics of the performance of Pacritinib in the Phase 2 studies, one of the characteristics look to me as if the drug might perform better the longer patients stayed on therapy. That being the case, when do we get more mature data with regard to PERSIST-1, will we see that at ASH potentially, is that something you plan to publish. I know we’ve talked about it previously, but are there any more concrete or can you give any more concrete guidance as to when we might see more mature data for PERSIST-1?

[Jim Bianco:]

We hope that would be accepted for ASH, so never have Pacritinib’s abstracts that we’re putting in as well as to see this out in other drug products that we’re working on for the December meeting and we’ll see if the society finds it of merit to present. You are absolutely correct, you hit on another important differentiating feature, Bert, is that because patients don’t have to reduce their dose or come off dose for treatment emerging cytopenias, they’re not able to stay on therapy for longer periods of time on therapeutic doses. Whether that translates in to better duration of response, more durability response and/or continued benefit over time is really one of the questions that we’re looking at for some of the data that we’re putting in for the meeting?

[Bert Hazlett:]

That’s helpful. And I guess just one more, following up on Charles and your comments on the regulatory submission in the US, what has transpired to make you have these discussions? I know you’ve been cautious about the guidance and the pace at which things might go in the US, but what’s giving you the confidence to move forward in the US to even have the discussions with PERSIST-1 in hand?

[Jim Bianco:]

I would say that we haven’t had an ad board where we weren’t encouraged to have that discussion. Jack, would you say - I mean every KOL group that we talk to, they all say the same thing, they have so much difficulty for example where the patient has a hemoglobin of 9, which as you heard, that 65% of their patients who are out more than a year plus from diagnosis are going to be anemic and so they know that when they treat them - and they want to treat them with a dose of rux, it actually gives them benefit, i.e., spleen volume and symptom control that they’re going to have to transfuse them within a month or two months and they drop 3 to 3.5 grams of hemoglobin. They go below the 7 threshold that everyone gets concerned about. So that’s something that right now is a problem. And then when you get below 50,000, they have nothing. I mean not even rux, they can’t even do homeopathic doses, 5 milligram or 10 milligrams of rux, because they won’t tolerate it and it’s not indicated in the label. And so that’s really been kind of the impetus to at least have that dialog and explore some of the feedback that we’ve been getting. I would say clearly coming out of VASCO that it was just, this is big, put it kind of like grassroots campaign of support, both from the patient community and from the physician community of wanting to have a second choice, another choice, and a choice that doesn’t have the complexities of having to manage dose and having to manage cytopenias and transfusions and all the other things associated with it. I mean like we’ve been saying all along, rux is a great drug, it has its issues and those issues are what we think pacritinib addresses.

[Bert Hazlett:]

Thanks for the additional color. I will be watching. Exciting days. Thank you.

[Operator:]

[Operator Instructions] We will take a question from David Lebowitz with Janney Capital.

[David Lebowitz:]

Thank you very much for taking my question. With respect to PERSIST-2, completing enrollment toward the end of the year or later in the second half, when might we expect to be able to see some top line data form that trial, I mean how long after enrollment is completed?

[Jim Bianco:]

Good question, David. So it’s - last patient 24 week visit. So when the last - when the 300th patient is randomized, you then have six months and assuming that the patient stays on for six months, they get to the 24-week end point where they’re evaluated for both the spleen volume and the TSS endpoint. That then has to be validated and then the data cleanup et cetera. So typically, we run between six to eight weeks after that 24-week period. So if you did the math, if you said the patient came, the last patient was enrolled on December 31st, you wouldn’t see data, right, they wouldn’t have their 24-week visit to June 30 of 2016 and then by the time we’re in a position to do that, six to eight weeks from database locked to top line analysis, you’d be looking at something in the summer around this time next year.

[David Lebowitz:]

So the data from this trial would probably come fairly late in our regulatory process, during a regulatory process in Europe, does that mean that chances are, if it doesn’t overlap, then obviously it wouldn’t get called in, but might European regulators want to see that data before they choose to make a decision?

[Jim Bianco:]

Because the trials are distinctly different in terms of the patient population and that you’re addressing, we and Baxalta do not think that that would be a concern. I believe that they’re actually going in for - they’re not looking for conditional authorization. I think they’re actually going in for full authorization, that’s their intent based on the PERSIST-1 study for the EMA. And as you pointed out, the EMA review cycle, if you submit it in December, that was the window, because they have scheduled dates, you get validated in Q1, their review cycle wouldn’t be really underway until late in 2016. It would be a 2017 obviously opinion from the CHMP. So even if the data were available next summer, I don’t think that that would be - that would impact kind of their timeline.

[Operator:]

That concludes today’s question-and-answer session. Dr. Bianco, at this time, I’ll turn the conference back to you for any additional or closing remarks.

[Jim Bianco:]

Thank you. Thanks, everyone for joining on the call. We always appreciate your support. Look forward to seeing you at the upcoming investor conferences. Hope you’re all enjoying your summer and that’s it.

[Operator:]

This concludes today’s conference and thank you for your participation.