G1 Therapeutics, Inc.
Q1 2020 Earnings Call Transcript

Published: 10 May 2020

[Operator:]

Good afternoon, ladies and gentlemen, and welcome to the G1 Therapeutics First Quarter 2020 Financial Results Conference Call. [Operator Instructions]. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host today, Mr. Jeff Macdonald. Please go ahead, sir.

[Jeff Macdonald:]

Thank you, Angela. Good afternoon, everyone, and welcome to the G1 Therapeutics First Quarter 2020 Corporate Financial update. On today's call, Mark Velleca, Chief Executive Officer; Raj Malik, Chief Medical Officer and Senior Vice President R&D; and Jen Moses, Chief Financial Officer, will provide an overview of the quarter with Q&A to follow-up.Before we begin, I'd like to remind you that this call will include forward-looking statements based on current expectations, such statements represent management's judgment as of today and may involve risks and uncertainties that could cause actual results to differ materially from expected results. Please refer to our filings with the SEC, which are available from the SEC or on our corporate website for information concerning risk factors that could affect the company.And now I'll turn the call over to Mark.

[Mark Velleca:]

Thanks, Jeff. Good afternoon, everyone, and thank you for joining us. We hope that you and your families are well. On today's call, we'll provide an update on our key achievements in the first quarter, discuss how we are navigating the evolving COVID-19 environment and review our first quarter results. After our prepared remarks, we'll open the call for questions.The COVID-19 pandemic is affecting many aspects of our lives, nowhere more than in health care. Like others in the field, we remain committed to advancing therapies that can benefit patients even in these difficult circumstances. Our entire team has maintained the high level of collaboration and execution required to bring new therapies to people with cancer. I'd like to thank our employees for their passion and dedication for patients and for continuing to drive our company forward.Our highest priority is to make trilaciclib available to patients as quickly as possible. Cancer patients experiencing chemotherapy-induced myelosuppression are especially vulnerable population. And trilaciclib has the potential to be the first proactively-administered myelopreservation therapy for these patients.Our vision for trilaciclib is that patients across a broad range of solid tumor types who received trilaciclib the first time and every time they are treated with chemotherapy. Clinical and patient-reported outcomes data have shown that trilaciclib has the potential to make chemotherapy safer, improve the patient experience, and in some settings, help patients live longer.We began enrolling new drug application, or NDA, for trilaciclib in small cell lung cancer in the fourth quarter of 2019 and are on track to complete the filing this quarter. The FDA has done an outstanding job of meeting the demands placed on it by the COVID-19 pandemic, while also keeping pace with sponsor interactions. Assuming this trend continues, we anticipate acceptance of our NDA in the third quarter, including assignment of a PDUFA date.As a reminder, we received breakthrough therapy designation for trilaciclib based on the compelling myelopreservation data across 3 randomized trials in small cell lung cancer.In part with our work on the NDA, we are preparing to make trilaciclib broadly available to patients with small cell lung cancer. Our medical science liaisons are engaging virtually with health care providers to better understand their experience with chemo induced myelosuppression and current approaches to reactively managing its complication.On the commercial side, we are excited that Soma Gupta joined G1 in March as our Chief Commercial Officer to lead the launch of trilaciclib. Soma most recently led the global launch of VYNDAQEL at Pfizer, which has emerged as an important therapy for patients and is significantly outperforming initial commercial expectations. She has a strong oncology background, having previously led the global commercial team responsible for Pfizer's oncology portfolio. Under her leadership, we are continuing to refine a patient-access strategy that will highlight the benefits of trilaciclib for patients, oncology practice centers and the health care system. She is also advancing development of our pricing, reimbursement and sales strategy in preparation for a potential launch in early 2021. You can expect more color on our progress from Soma as we roll out our commercial plan in greater detail in the second half of the year.Small cell lung cancer is our first opportunity to demonstrate the value trilaciclib can provide patients. Based on the mechanism and existing preclinical and clinical data, we believe trilaciclib has the potential to improve outcomes across multiple solid tumors and chemotherapy regimens. We have a robust development program to evaluate additional indications, which Raj will discuss in more detail shortly.We have also made notable progress on the development of our oral SERD rintodestrant. Findings from our ongoing monotherapy trial have informed our decision to select 800 milligrams as the go-forward dose in future trials. And beginning in this quarter, we'll be evaluating rintodestrant in combination with the CDK4/6 inhibitor palbociclib, which is being provided by Pfizer under a nonexclusive supply agreement.Before I turn the call over to Raj, I'll make a few additional comments on our business operations relative to the COVID-19 pandemic. The trilaciclib NDA remains on track for submission this quarter. There had been no interruptions to our scheduled interactions with the FDA regarding the filing or regarding development plans across our pipeline. We anticipate that initial recruitment for the 2 trials we are starting this quarter, the trilaciclib I-SPY 2 trial and rintodestrant combination trial will be impacted but are making every effort to keep patient enrollment timelines on track. Our ongoing rintodestrant monotherapy trial is fully enrolled, and we are working with our sites and CRO partners to minimize disruption. We do not anticipate significant supply chain shortages or delays.I'd now like to turn the call over to Raj for an update on our trilaciclib and rintodestrant development programs. Raj?

[Rajesh Malik:]

Thanks, Mark, and good afternoon, everyone. As Mark noted, we are close to completing our NDA submission for trilaciclib in small cell lung cancer. We are also continuing to explore additional tumor types where trilaciclib may benefit patients. We plan to initiate a registrational Phase III trial in colorectal cancer in the fourth quarter of this year, with primary endpoints focused on myelopreservation. This trial will use a combination chemotherapy regimen used for treating GI malignancies such as colorectal cancer. This full FOLFOXIRI regimen contains 5-FU, oxaliplatin and irinotecan and is highly myelosuppressive, particularly with regard to neutropenia.5-FU was used in many of our preclinical myelopreservation studies that shows the benefits of trilaciclib. We have completed a pre-Phase III meeting with the FDA to discuss the trial design, and we'll provide more details once the protocol is finalized. We're also advancing trilaciclib in breast cancer, based on the survival data from our Phase II triple-negative breast cancer trial.Later this quarter, the trilaciclib arm of the I-SPY 2 trial will open. This trial will examine the use of trilaciclib in all subtypes of breast cancer and also provide us with data for trilaciclib in combination with several broadly used chemo classes and an anti-PD1 immunotherapy. I-SPY 2 is an ongoing platform trial run by a consortium with established academic sites in place. Data from I-SPY 2 and our ongoing Phase II TNBC trial will inform future breast cancer trials. We are planning to provide updated survival data from the TNBC trial in the fourth quarter of 2020.I'd also like to make a few comments about trilaciclib relative to the ongoing COVID-19 pandemic. This global crisis has highlighted that cancer patients experiencing chemotherapy-induced myelosuppression are especially vulnerable, and recent commentary from the oncology community has highlighted the burden of managing myelosuppression. In fact, recent COVID-19 guidance from the NCCN has specifically noted that broader strains on the health care system such as limited blood supply and higher infection risk, call for practice changes to how clinicians address chemotherapy-induced myelosuppression with an important goal of reducing complications after chemotherapy. While we have always viewed the myelopreservation benefits of trilaciclib as an important advance in patient care, the current situation has put this need into sharper focus.Turning now to our oral SERD rintodestrant. Later in the second quarter, we plan to expand our Phase I/IIa trial to include an arm evaluating a combination of rintodestrant and the CDK4/6 inhibitor palbociclib, commercially known as Ibrance. This arm will enroll approximately 40 patients with ER-positive HER2-negative breast cancer. And as Mark alluded to earlier, patients will receive an 800-milligram dose of rintodestrant once daily. Recruitment will begin at sites currently involved in our monotherapy arm with more sites coming online in the second half of the year. While early enrollment will likely be impacted by COVID-19, we anticipate the trial will be fully enrolled by the end of the year.I'd also like to point out that the rintodestrant monotherapy arm of the trial was fully enrolled last year, and we anticipate reporting updated safety and efficacy data from all 67 patients in the fourth quarter of 2020. I'd now like to turn the call over to Jen for a review of the financials. Jen?

[Jennifer Moses:]

Thanks, Raj. I'll review several items on today's call. Full financial results for the first quarter of 2020 are available in our press release and 10-Q. We reported a net loss of $31 million for the first quarter of 2020 compared to $24 million for the first quarter of 2019. Operating expenses were $31.8 million for the first quarter of 2020 compared to $25.9 million for the first quarter of 2019.GAAP operating expenses included stock-based compensation expense of $4.7 million for the first quarter of 2020 compared to $3.8 million for the first quarter of 2019. Research and development expenses for the first quarter of 2020 were $20.4 million compared to $18.1 million for the first quarter of 2019. The increase in R&D expenses was primarily due to an increase in clinical program costs and costs for manufacturing active pharmaceutical ingredients.General and administrative expenses for the first quarter of 2020 were $11.4 million compared to $7.8 million for the first quarter of 2019. The increase in G&A expenses was largely due to increases in compensation due to additional headcount, precommercialization activities, medical affairs costs and professional fees and other administrative costs necessary to support our operations. As of March 31, 2020, we had $242.4 million in cash and cash equivalents from the balance sheet compared to $269.2 million as of December 31, 2019.We are reiterating our guidance of ending 2020 with between $110 million and $130 million in cash and cash equivalents. And expect our current cash position is sufficient to support operations into the fourth quarter of 2021. In addition, we are advancing discussions on several fronts to bring in nondilutive capital during this calendar year. Our current guidance does not consider proceeds from partnerships, collaboration activities or any other inflow of capital that we may realize in 2020.I'll now turn the call back over to Mark. Mark?

[Mark Velleca:]

Thanks, Jen. We are particularly excited about the pending NDA submission of trilaciclib and the near-term opportunity to bring this breakthrough therapy to patients with small cell lung cancer. Our medical education and commercial preparations are well underway, and we will continue to invest in additional trials to evaluate the potential benefits of trilaciclib in other tumors and with different chemotherapy regimens. With regard to rintodestrant, we believe this therapy has best-in-class potential among the oral SERDS in development. We have selected our go-forward dose of 800 milligrams based on data from our ongoing monotherapy trial and are initiating a combination trial with the CDK4/6 inhibitor palbociclib this quarter. Additional efficacy and safety data from the monotherapy arm will be presented in the fourth quarter.We are in a strong position to continue advancing these therapies on behalf of patients and look forward to updating investors on a number of regulatory, clinical and corporate milestones in the second half of the year.Before we go to Q&A, I would like to acknowledge all of the health care professionals who are providing essential services through the COVID-19 pandemic. We have the privilege to collaborate with oncologists, nurses and patient support teams regularly. Never have we been so appreciative of their dedication and compassion for patients. On behalf of everyone at G1, thank you for the sacrifices you are making for all of us during this challenging time.That concludes our prepared remarks. Operator, please open the call for questions.

[Operator:]

[Operator Instructions]. Our first question comes from the line of Dane Leone with Raymond James.

[Dane Leone:]

Good to hear the updates, and things are progressing. I just wanted to get some updated thoughts on to the -- well, I guess, two things. One, rinto, in kind of context for what you'll be looking for, one, from the monotherapy update later this year? And then kind of confirmation of what the combo with palbo would do for the business development plan on that front? And then just secondly, do you have any updates in terms of what the plan is with the lerociclib program going forward?

[Mark Velleca:]

Yes. Thanks, Dan. It's Mark. I can take that. Raj might chime in, but I'll start with rintodestrant. We fully enrolled the 67 patients in monotherapy at the end of last year. We have the data in hand, and that informed our decision to move forward with 800 milligrams. You'll see those data, we'll share them in the fourth quarter. And we're moving forward with the palbociclib combination, as you mentioned. As far as benchmarks for that, it's really similar to POLOMA-3. This is a more endocrine sensitive patient population. So looking at palbociclib plus fulvestrant, we should be seeing similar response rates in CBRs with palbociclib and rintodestrant. And that obviously could inform some of the partnering dialogue that we're starting to have so that would be mid next year when we have those data, assuming that trial gets fully enrolled this year, which is our assumption.With regards to lerociclib, we are progressing a number of partnering discussions. We will update the data for the 150-milligram and 200-milligram cohorts that were fully enrolled again last year. We have the data in hand. That's informed our decision that 150-milligrams BID is the go-forward dose. So we'll present those data in the third quarter and are progressing a number of partnering discussions.

[Operator:]

And your next question is from the line of Chris Shibutani with Cowen.

[Christopher John:]

This is CJ on for Chris this evening. With respect to the colorectal trial, it's going to be starting at the end of this year. Was curious about how you're thinking about the endpoints for myelopreservation there and whether you'll be potentially adapting those that were used initially in the Phase II trials to perhaps account for something like additional chemo cycles, which we saw in the triple-negative trial. And then also with respect to giving us some idea of potential time lines. Originally, we had been thinking that this was going to be somewhat larger trial focused on survival benefits. Would this now look more like the size of the Phase IIs for small cell and triple negative?

[Mark Velleca:]

Thanks, CJ, it's Mark. I'll let Raj handle that question.

[Rajesh Malik:]

Yes, CJ. Yes. So the endpoints will be myelopreservation endpoints, so similar to what we evaluated in the small cell program. Yes. And there may be some additional ones as well when we'll provide details on the study, obviously, we'll do so. We are -- as I mentioned, we had this pre-Phase III meeting with the FDA already. We are, of course, also interested in looking at tumor efficacy readouts as well. And then you, of course, referenced the TMBC study as something that we're interested in looking in this study also.

[Mark Velleca:]

You want to comment on the number of patients, Raj...

[Rajesh Malik:]

Yes. So this will be the -- yes, it will be several hundred patients. A study that's really designed more for myelopreservation rather than survival, for example.

[Christopher John:]

All right. So we'll need all of those patients for the myelopreservation endpoint then?

[Rajesh Malik:]

Yes. There are a number -- like in any study design, there are a number of endpoints that one evaluates. And so the study is going to be appropriately designed to evaluate the endpoints that we will be, which is going to be focused on myelopreservation.

[Mark Velleca:]

And another end point, CJ, it's Mark again, are available when -- very soon after the [indiscernible] our expectation data in early '2 and just to reiterate what Raj said, it's just a few hundred patients.

[Christopher John:]

Got it.

[Mark Velleca:]

And it's a registrational trial, obviously, this is a pre-Phase III meeting.

[Rajesh Malik:]

That's right.

[Operator:]

And your next question is from the line of David Nierengarten with Wedbush Securities.

[David Nierengarten:]

I had one. If you could kind of remind us and maybe lay out a little bit of how you're thinking about the launch for trilaciclib? Obviously, starting in small cell lung, but as you get additional data for breast and colon cancer. Are there any particular steps in there where you could file for perhaps a sNDA sooner rather than later? Do you anticipate going through the whole studies in order to add the additional indications to a potential label?

[Mark Velleca:]

Sure. David, it's Mark. I'll take that question. You're going to hear a lot more about the launch preparations from Soma Gupta, our CCO, at an upcoming call, certainly, in August call. We are making a number of preparations for that. As you point out, it will initially be in small cell lung cancer. And based on a potential priority review, we'll be ready to go early next year. To your question, our expectation is that both the I-SPY 2 trial in neoadjuvant breast cancer, all subtypes and the registrational Phase III for colorectal will read out in early '23. About 2 years from launch, since it is a registrational trial, yes, we'll be moving very quickly to file an sNDA as soon as possible. And there may be other trials that we run, obviously, from '21, '22 onward that we could publish and present, and those will also be available to us. So expectation, again, early '23 for I-SPY 2 and the colorectal study.

[Operator:]

And your final question is from the line of Ed White with H.C. Wainwright.

[Edward White:]

So just to -- you had said the MSLs are being done virtually already in preparation for the launch for trila. I'm just wondering if you are also planning on a virtual launch or how you're handling that. If everything is going to be digital or if you're going to do the traditional planning for the traditional type of launch? And then also just a question for Jen. I noticed that R&D expenses were down 17% sequentially. I'm just curious, you had mentioned why it's up year-over-year. I'm just curious as to why it was down so much from last quarter.

[Mark Velleca:]

Thanks, Ed, it's Mark. I'll answer the first part of the question and then turn it over to Jen. Yes, I do believe that launching drugs for the foreseeable future will be very different than it has been. But we are looking to step up digital engagement. That will obviously have an effect on the size of the footprint that you have in the field. And as I mentioned on the prior question, we'll be hiring a lot more about that from Soma. So with that, I'll turn it over to Jen for the second part of the question.

[Jennifer Moses:]

Sure. Ed, the change in R&D expense was primarily due to the PDUFA fee that we paid in the fourth quarter. That was a rather large fee a couple of million dollars. And so that is the main part of that variance.

[Operator:]

And I'm showing no further questions at this time. I would now like to hand the conference back to Dr. Mark Velleca for closing remarks.

[Mark Velleca:]

Thank you, Operator. That concludes the call. Please reach out to us with any questions. We look forward to engaging virtually with many of you around ASCO later this month at the Raymond James conference in mid-June. Thank you for joining us today, and please stay well.

[Operator:]

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation, and have a wonderful day. You may all disconnect.