Forma Therapeutics Holdings, Inc.
Q1 2022 Earnings Call Transcript

Published: 6 May 2022

[Operator:]

Welcome to the Forma Therapeutics, First Quarter 2022 Financial Results and Business Update Conference Call. All participants are currently in listen-only mode. Following management's prepared remarks, we will hold a Q&A session. . As a reminder, this call is being recorded today May 6, 2022. I would now like to turn the conference over to Mario Corso, please go ahead.

[Mario Corso:]

Thank you, Gigi. This is Mario Corso, Senior Director of Investor Relations at Forma. Good morning to our listeners and welcome to today's call to review first-quarter 2022 financial results and business update. On this call, I'm joined by Frank Lee, our President and Chief Executive Officer; Patrick Kelly, our Chief Medical Officer; Dave Cook, our Chief Scientific Officer; and Todd Shegog, our Chief Financial Officer. Before we begin, I'd like to caution listeners the comments made and financial information provided during this conference call includes certain statements that are estimates, beliefs, forward-looking, and/or subject to various risks and uncertainties. Any statements made during this call that are not statements of historical or current facts are intended to be forward-looking statements pursuant to the Safe Harbor provisions on the Private Securities Litigation Reform Act of 1995. We want to emphasize that such forward-looking statements reflect our current expectations and assumptions regarding timing, enrollment, success, and data announcements of our current ongoing clinical trials, therapeutic potential, hypotheses of mechanisms of action and clinical benefits, and safety of our product candidates, planned regulatory submissions, our financial condition and capital requirements, our business operations, development plans, the potential impact of COVID-19 on our business and clinical development and relationships with third parties and collaborators and are neither predictions nor guarantees of future events or performance. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with our business including those under the heading entitled Risk Factors in our annual report on Form 10-K for the year ended December 31st, 2021 and in our quarterly report on Form 10-Q for the quarter ended March 31st, 2022 that will be filed with the SEC today and in subsequent reports including our current reports on Form 8-K. The company disclaims any obligation to update or revise any forward-looking statements except as required by applicable law. Before turning the call over to Frank, I'd like to mention our upcoming R&D day with investors that was outlined in today's release. This meeting will take place virtually on May 26th from 8

[Frank Lee:]

Thank you, Mario good morning, everyone and thank you for joining us today. The first quarter of this year marks strong progress in our ongoing clinical programs. We continue to enrollment in our Phase 2/3 trial of Etavopivat in sickle cell disease, the Hibiscus study. We're pleased to say we're on track for the first interim analysis in the latter part of this year. We're also on track with enrollment in the Phase 1 trial of FT-7051 in metastatic castration-resistant prostate cancer. We expect to assume be able to identify dose for further expansion. We're initiating two Etavopivat Phase 2 trials this year. The first is underway in transfusion dependent and non-transfusion dependent thalassemia, as well as sickle cell disease patients who are transfusion dependent. Sickle cell disease patients who are transfusion dependent represent approximately 20% of the overall sickle cell disease patient population and represent an area of substantial unmet need. The second trial will begin in the second half of this year in lower risk myelodysplastic syndrome (MDS). Low-risk MDS represents another area of substantial unmet need. Chronic transfusions to treat the symptomatic anemia associated with MDS is common practice whether a patient is requiring blood transfusions to treat their hemolytic anemia as in the case of thalassemia or sickle cell disease or to treat their anemia due to poor production as in the case of MDS. Iron overload remains a substantial and significant risk. We believe Etavopivat's unique mechanism of action may improve the symptomatic anemia in all these indications, reducing the need for transfusion therapy and reducing the risk for iron overload. As we look forward we have some important upcoming events. On May 26th, we plan to host our first Research and Development day. At this event, we will provide the first look into our research portfolio including a compound, which is currently in IND enabling studies. In addition, we'll provide additional details on the non sickle cell disease Etavopivat programs and discuss the emerging science of red blood cell health. We'll also share a trial update on our FT-7051 program and towards the end of the year, we're on track to reach interim analysis one from the Hibiscus Study and also to show early data from the transfusion study. Being a trusted partner to the patient communities, we serve as an important corporate goal for Forma. Among other initiatives, we launched our Forma Bridge Program at the end of last year. The transition from pediatric to adult care can be very challenging. Forma Bridge was designed to support this important transition. And I'm very pleased to report that there have been a high level interest in the program and we received a number of proposals from a mix of healthcare institutions, patient organizations, and community-based organizations. Grand awards are expected to be announced in the coming months. We've had a strong start to the year and we're well positioned to deliver on our goals. We are well capitalized with over $441 million in cash. We have a differentiated and growing clinical stage pipeline. And we have a highly engaged group of employees who embodied the idea of the science of giving a damn. In closing, I'd like to recognize a remarkable efforts of our investigators and patients for their support and contributions in advancing our purpose to transform the lives of patients living with rare hematologic disorders and cancers. I'll now turn it over the call to Pat to provide a brief update on our development programs.

[Patrick Kelly:]

Thank you Frank, and good morning everyone. I will provide a brief overview of our development programs for Etavopivat and FT-7051. Etavopivat is our once daily selective PKR activator with a distinct multimodal mechanism of action to improve oxygen binding and reduces hemoglobin's polymerization via decrease in 2-3 TPG, and also to repair the membrane damage of red cells via the increase in ATP. We have completed our Phase 1 trial of Etavopivat in sickle cell disease and the results were presented in December at the ASH Annual Meeting. We have generated a compelling dataset based on measures of response at hemoglobin particular sites and haemolysis. And a comprehensive dataset demonstrating an improvement in measures of red blood cell health such as deformability and hydration. We believe the data also suggest that daily Etavopivat could have important systemic effects, such as reducing inflammation, hypercoagulability, and hypoxia. We are very encouraged by the VOC trend analysis from the Phase 1 trial, demonstrating with greater than three years of Etavopivat's exposure, there was a 68% reduction in the annualized rate of VOCs resulting in hospitalization compared to the patient reported VOCs in the 12 months prior to trial enroll it. We have also observed improvement in the paid events that do not qualify as VOCs. Looking ahead, we have initiated a Phase 2 trial of Etavopivat to explore the potential in transfusion dependent sickle cell disease and also both transfusion dependent and non-transfusion dependent thalassemia. As Frank noted earlier, up to 20% of patients with sickle cell disease are on a chronic transfusion -- blood transfusion program most commonly for the prevention of stroke, a devastating and far too common consequence of their sickle cell disease. This trial will enroll a total of 60 patients across the three treatment arms with response measured by the proportion of patients with a reduction in red blood cell transfusion requirements compared to prior history or a hemoglobin increase over baseline from those patients with thalassemia not receiving chronic transfusions. We expect to have some initial results from this trial in late 2022. For our FT-7051 program or our CBP/p300 inhibitor in development for the treatment of metastatic castration-resistant prostate cancer, the ongoing Phase 1 trial has continued dose escalation. We intend to provide a trial update later this month during our R&D day with more comprehensive results for the trial expected later this year. With that, I will now turn the call over to our Chief Financial Officer, Todd.

[Todd Shegog:]

Thank you, Pat, and thank you everyone for joining us on today's call. I will first spend a few minutes discussing our financial results for the quarter ended March 31, 2022 and then discuss our cash position and outlook. Our net loss for the quarter ended March 31, 2022 was $41.1 million, which compares with a net loss of $36.0 million for the quarter ending March 31, 2021. The increased net loss was driven by increased spending in support of our pre -clinical and clinical development programs as well as employee hiring to support our operations. Research and development expenses were $31.3 million for the quarter ended March 31, 2022, compared to $26.3 million for the quarter ended March 31, 2021. The increase was primarily attributable to the increase in research and development staff to support the advancement of Etavopivat and other programs, an increase in equity-based compensation, the conduct of our Phase 2/3 trial in sickle cell disease patients, and study startup costs related to our Phase 2 trial in thalassemia. General and administrative expenses were $13.1 million for the quarter ended March 31, 2022,compared to 9.9 million for the quarter ended March 31, 2021. The increase was primarily attributable to equity-based compensation costs due to executive and staff hiring and other-related general and administrative costs. Our cash cash equivalents and marketable securities balance as of March 31, 2022 was $441.3 million compared to $490.3 million a year-end 2021. Cash use reflects operating expenses and working capital requirements to support our operations. Overall, we continue to be in a strong financial position with funding through the third quarter of 2024, GG Lee may now take questions.

[Operator:]

Please standby as we compile the Q&A roster. Our first question come from the line of Maury Raycroft from Jefferies your line is now open.

[Maury Raycroft:]

Hi, good morning. Congrats on the progress and thanks for taking my questions. I did want to check in the regulatory front for sickle cell disease and see if you can comment on any discussions to support the 24-week hemoglobin responses to surrogate endpoint for an accelerated approval path. And also if you can clarify if you need to wait for the first interim to be completed before you can finalize those plans.

[Frank Lee:]

Thanks for question Maury. It's Frank Lee, here. We continue to have discussions on working through the regulatory path. And so no further updates at this time. It's very consistent with what we've communicated before.

[Maury Raycroft:]

Got it. Okay. And for the R&D day coming up, looking forward to the 7051 data there, I'm wondering if you can talk a little bit more about where you're at with the dose escalation and just wanted to clarify if the expansion cohort, if that has started yet or will that be -- if you can put a finer point on when that could happen.

[Frank Lee:]

Yeah. So we'll provide some additional details, Maury, on the progress there, and I think this will be more of a trial update on where we are, and we are making good progress. And so I'd say stay tuned for the May 26 R&D day. We'll provide additional details there.

[Maury Raycroft:]

Okay. Maybe the last question. Just -- we've talked about the AR-V7 patient population in the past, and it -- just wondering if you can say if we should expect an update in that population at the R&D day and how many AR-V7 patients that you could have data in.

[Frank Lee:]

Maybe, Pat, you could speak to this a little bit. I know we've had good success in enrolling patients overall in the AR-V7. So maybe you can speak to those.

[Patrick Kelly:]

Yeah. Just briefly more detail at the end of the month. But yeah, not surprisingly, with the understanding that this targeted therapy should have activity in that population there. If we continue to monitor patients as they enroll, looking for that mutation, and we're seeing a fairly robust enrollment into this Phase 1 of patients with detectable AR-V7 disease.

[Maury Raycroft:]

Great. Okay. Thanks for taking my questions.

[Frank Lee:]

Thanks, Maury.

[Operator:]

Thank you. Our next question comes from the line of Mark Breidenbach from Oppenheimer. Your line is now open.

[Mark Breidenbach:]

Hey. Good morning, guys, and thanks for taking the questions. Just a couple of quick ones from me. First of all, I wanted to confirm with the upcoming interim data from pivot on the IA1 interim readout. This is where you'll be announcing which those between the 200 and 400 milligram once daily dosing, you'll be advancing into the Phase 3 portion of the trial; is that correct?

[Frank Lee:]

Yes, that's dose selection. Pat, you can speak a little bit more about this one.

[Patrick Kelly:]

Yeah, that's right. It says the remainder of the Phase 2 portion is looking at 200 milligrams versus 100 -- 400 milligrams versus placebo up on a daily basis and that analysis will be out at the end of the year.

[Mark Breidenbach:]

Okay. And at any point during Phase 1 dose escalation, did you encounter any evidence of thrombocytopenia? I'm just asking because we recently learned of another PKR activator that hitched thrombocytopenia and DLT during dose escalation?

[Patrick Kelly:]

Yeah no. In healthy volunteers as well as sickle cell patients, the hematologic effects for the hemoglobin improvement are absolute ridiculous in like counts. Some effects on improving white cell counts as well but no effects on platelet. And this is the second PKR activator with that. As you might recall, another company had a molecule that in healthy volunteers there was problems with thrombocytopenia as well as liver toxicity that made that program discontinued.

[Mark Breidenbach:]

Okay. That's good color. And maybe just a quick one for Todd. There was a pretty sharp reduction in R&D expense from the previous quarter. Just how should we be thinking about this line item going forward in 2022?

[Todd Shegog:]

Yeah. Thanks, Mark. The fourth quarter was a bit higher as you pointed out, versus what we saw in the first quarter and that's just timing of development activities. Manufacturing in particularly can be a little bit lumpy depending upon way and actual work occurs but as we trend towards plan, I would expect to see it gradually increase with the advancement of the programs, with the addition of staffing and so forth to execute on the program. I think the fourth-quarter was a little bit of a blip, but I think you can look at the trend increasing from Q1.

[Mark Breidenbach:]

Okay. Super helpful. Thanks for taking the question and congrats on the quart's progress.

[Frank Lee:]

Thanks Mark

[Operator:]

Thank you. Our next question comes from the line of from Cancer. Your line is now open.

[Unidentified Analyst:]

Congrats on the quarter and thanks for taking my questions. Closely on the new molecule that you plan to disclose during the R&D day, I don't there will be more details there, but as a teaser can you maybe provide more details on whether this is focused on oncology or hematology and why are you excited about this molecule.

[Frank Lee:]

So , thanks for the question. It's in oncology. And we're going to go through the program and a lot more detail, but we'll just keep it that way. It's in oncology and that's a broad guidance we've been providing so far.

[Unidentified Analyst:]

Lastly, any up -- on FT-7051, any of this on potential combination therapies here, and maybe even moving onto earlier lines, what combos do you think might make sense, and when can we expect to hear more? Will it be after the full data disclosure at the end of the year, or could it be sooner? Thank you for taking my questions.

[Frank Lee:]

And maybe Dave, you take that one.

[Dave Cook:]

Sure. I think there's always an interest in moving into earlier lines patients. Patients in the Phase 1 thus far have had a long history of pre -treatment and many of them experienced chemotherapy as we illustrated from the cohort last call. As we move into earlier lines, we will consider combinations, but I don't think we'll have anything definitive to say until the full data set at the end of the year.

[Operator:]

Thank you. Our next question comes from the line of Robin Garner from Craig-Hallum. Your line is now open.

[Robin Garner:]

Congratulations on the progress this far. Wanted to ask you about the data update for the transfusion dependent sickle cell disease and the thalassemia. What kind of initial results might we expect for you to report by the end of the year?

[Frank Lee:]

Thanks for the question, Robin. These will be early results and so, I wouldn't expect anything definitive.

[Robin Garner:]

Okay, thank you for that. And then --

[Frank Lee:]

[Robin Garner:]

Okay. And then also for the pediatric sickle cell disease and also MDS, what are the timelines for those new studies? When can we expect to see data and the nature of those readouts?

[Frank Lee:]

So we'll be -- we're initiating the pediatric studies and so that will take some time, as you know, that to recruit. And so I don't think we've put definitive timelines out there yet but we've initiated those studies.

[Robin Garner:]

Thank you.

[Operator:]

Thank you. At this time I'm showing no further questions. I would like to turn the call back over to Frank Lee for closing remarks.

[Frank Lee:]

All right. Well, thank you, everybody for participating on today's call. I'd like to really thank our employees, our investigators, our patients who have continued to support our research and development pipeline progress and again, I want to thank all of you for participating on today's call. Thank you very much.

[Operator:]

This concludes today's conference call all. Thank you for participating. You may now disconnect.