G1 Therapeutics, Inc.
Q1 2018 Earnings Call Transcript

Published: 4 May 2018

[Operator:]

Good day, ladies and gentlemen, and welcome to the G1 Therapeutics First Quarter 2018 Corporate and Financial Update. [Operator Instructions)]. As a reminder, today's program may be recorded. I would now like introduce your today's program, Jeff Macdonald. Sir, you may begin.

[Jeff Macdonald:]

Thank you, Operator. Good afternoon and welcome to G1 Therapeutics First Quarter 2018 Corporate Update Conference Call. Joining me are Mark Velleca; Chief Executive Officer; Raj Malik; Chief Medical Officer and Senior Vice President, R&D; and Buck Phillips; Chief Financial Officer and Senior Vice President, Corporate Development. Terry Murdock, our Senior Vice President, Development Operations will also be available during the Q&A portion of the call. Before turning the call over to Mark, I would like to remind you that today's 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. I'll now turn the call over to Mark.

[Mark Velleca:]

Thanks, Jeff. Good afternoon everyone, and thank you for joining us today. In the first quarter of 2018, we continue to build on a successful 2017. On today’s call, we’ll review key milestones for our three programs, trilaciclib, G1T38 and G1T48. After our prepared remarks, we’ll be available to take your questions. I’ll begin with our most advanced clinical program, trilaciclib, our short acting CDK 4/6 inhibitor that is administered intravenously prior to chemotherapy. In March, we announced positive Phase 2A topline data showing robust myelopreservation benefits of trilaciclib versus placebo in small cell lung cancer patients receiving first line chemotherapy. I would encourage you to review the press release we issued on March 5 for more details on the findings, and remind you that we plan to present these data at a medical meeting in the fourth quarter. Based on the strength of the clinical data across multiple hematopoietic lineages, we have accelerated our timeline for interactions with regulators, which we had originally planned for early 2019. We now have meetings scheduled for this summer with the FDA and European regulatory authorities. We’ll provide an update regarding this ongoing dialogue later this year as appropriate. Data from the trilaciclib second-/third-line small cell in triple negative breast cancer trials, which we’ll read out in the fourth quarter of this year, will also inform our development and regulatory plans. Clarity on the path to approval will be dependent on the results of ongoing clinical trials and subsequent regulatory discussions. Potential plans may include initiating a Phase 3 study in 2019. Now let me turn to G1T38, our potential best-in-class oral CDK 4/6 inhibitor. We are presenting early Phase 1b data at ASCO next month on the combination study with Faslodex in breast cancer. Raj will discuss that in more detail in just a moment. In April, we announced the initiation of another G1T38 combination trial, this one with Tagrisso for non-small cell lung cancer. Given recent data on Tagrisso presented at AACR and its approval as first-line therapy, we're excited about how G1T38 may further improve patient outcomes. Finally, we are on track to initiate the first clinical trial of G1T48, our oral selective estrogen receptor degrader, or SERD later this quarter. This trial will initially consist of G1T48 monotherapy in ER positive HER2 negative breast cancer. Our plan is to combine G1T38 with G1T48, and that combination trial could initiate in 2019. I will now turn the call over to Raj to provide more color around the upcoming G1T38 data presentation at ASCO.

[Raj Malik:]

Thanks, Mark and good afternoon everyone. As Mark mentioned, we are presenting the first data from our ongoing Phase 1/2 trial of G1T38 in patients with ER positive HER2 negative breast cancer at ASCO on June 2nd. This is an open label trial and patients receiving a combination of oral G1T38 and Faslodex given intramuscularly. We’re testing two different schedules of G1T38, with the drug given once a day or twice a day continuously without a drug holiday. The trial design consists of two parts, dose finding and expansion. Once we complete the dose escalation which is currently ongoing, we expect to enroll approximately 30 participants in the expansion phase. The primary outcomes of the trial are assessing dose limiting toxicities, identifying a recommended Phase 2 dosing schedule and safety. Secondary outcomes include pharmacokinetics, pharmacodynamics, tumor response, progression-free survival and overall survival. The data at ASCO will include preliminary findings from the ongoing dose escalation portion of the trial. This is positive from a safety perspective since we have been able to progress through several dose escalations. We will present early safety and tolerability findings and PK data. We are also following effects on neutrophil counts when G1T38 dose continuously without a drug holiday. In our 28 day toxicology studies, we were able to give G1T38 continuously. We observed that neutrophil counts decreased over the first 14 days as expected, and then plateaued without a further decrease for the remainder of the 28 day dosing period. We’re doing similar analyses with the early clinical data, and we’ll report these findings at ASCO. We will also report early efficacy data consisting of tumor response assessments. It is important to keep in mind that since we are still in the dose escalation portion, the efficacy data are preliminary. I will now turn the call over to Buck for a discussion of the first quarter financials. Buck?

[Buck Phillips:]

Thank you, Raj and good afternoon everyone. Our first quarter financial results can be found in our earnings press release, which is available on our website. Let me take a moment to walk you through the financial highlights contained in that release. We reported a net loss of $20.4 million for the first quarter of 2018 compared to $12.3 million for the first quarter of 2017. Operating expenses were $20.7 million for the quarter, compared to $12.4 million for the prior year period. GAAP operating expenses include non-cash stock compensation expense of $1.6 million for the first quarter of 2018 compared to $0.5 million for Q1’17. Research and development expenses for the first quarter of 2018 were $17.3 million compared to $11.1 million for the prior year period. The increase in expenses was driven by an increase in clinical program costs, drug manufacturing costs to support clinical programs, and personnel costs related to additional headcount. General and administrative expense for the first quarter of ‘18 were $3.4 million compared to $1.3 million for the first quarter of ’17. The increase in expense was largely driven by an increase in professional fees and personnel related costs. As of March 31, 2018, we had $194.4 million in cash, cash equivalents and short term investments. This includes the $107.9 in net proceeds from our March offering. This compares to $103.8 million on December 31 of 2017. As discussed on this call, the positive trilaciclib clinical of data presented in March, has accelerated our timeline for interaction with regulators and potential paths to approval that may include initiating a Phase 3 clinical trial in 2019. Therefore, the company will make additional investments in trilaciclib, including manufacturing, regulatory activities to facilitate future filings, pre-commercialization initiatives, including value and access studies pharmacoeconomic and pricing analyses, and market research, and additional headcount and corporate infrastructure to support these activities. Based on the additional investments, we are revising our cash burn guidance for 2018 from a range of $65 million to $75 million, to a new range of $75 million to $85 million. With that, I'll turn the call back over to Mark.

[Mark Velleca:]

Thanks, Buck. To summarize our upcoming milestones, we will provide an update on our regulatory dialogue with US and European regulatory authorities on trilaciclib later this year. By the end of June, we expect to complete enrolment in the Phase 2 trials of trilaciclib in second-/third-line small cell lung cancer and triple negative breast cancer. Preliminary data from both trials are expected in the fourth quarter of 2018. We're presenting preliminary data from the Phase ½ trial of G1T38 plus Faslodex in ER positive HER2 negative breast cancer at ASCO on June 2. And we are on track to initiate a Phase 1 trial of G1T48 in ER positive HER2 negative breast cancer by the end of this quarter. That concludes our prepared remarks. Operator, please open the call for questions.

[Operator:]

[Operator instructions]. Our first question comes from Anupam Rama with ‎J.P. Morgan. Your line is now open.

[Tessa Romero:]

Hi guys. This is Tessa on for Anupam this evening. Thank you for the call and for taking our questions. I guess one from us. With the initial Phase 1b data in ER positive breast cancer expected here at ASCO in 2Q, what should be anticipated with respect to what will be contained within the preliminary efficacy and safety data that you all are presenting? And what might we have to wait for in the follow up? And then maybe help us set some of the expectations from your standpoint on what the benchmarks for success are in the study. And then finally, if I could one more, just should we expect there to be any data in the abstract or will we have to wait for the full data presentation at ASCO? Thanks so much guys.

[Mark Velleca:]

Thank you, Tessa. I'm going to let Raj take that question.

[Raj Malik:]

Great. Hey Tessa. So yes. So keep in mind first of all, this is early Phase 1 data. So the focus will be on safety tolerability and PK. And we will present longitudinal neutrophil data. I alluded to that in my remarks. So we will present that data and what the neutrophil counts look like with continuous dosing of G1T38, which cannot be achieved as you know, with two of the other three CDK 4/6 inhibitors. We will present response data. However, other PFS and OS data are immature. But this should remind you and the study is similar to the PALOMA 3 study which was the pivotal study of palbociclib with fulvestrant. And in that study, the median PFS was about 10 months, and the median time to response was around 16 weeks, which is why the trial has been going a little bit over a year and hence the data should still be considered premature, or not immature, early I should say. So I hope that answers your first two parts in terms of what data we’re presenting and the benchmarks. We do have data in the abstract that you will see. It’s going to be on 24 patients’ worth of data and we expect to have a few more patients at the presentation itself.

[Tessa Romero:]

Great. Thank you so much guys.

[Operator:]

Our next question comes from Joseph Thome with Cowen & Company. Your line is now open.

[Joseph Thome:]

Hi guys. Thank you for taking my questions. Just a couple for me. I guess in terms of the development path forward for trilaciclib after these summer meetings, will you need to meet with the agencies again following the Q4 data readouts? And maybe, what would a Phase 3 program for trilaciclib look like, especially if you are going after more of a chemo agnostic label. And then I guess, wouldn't - in terms of the combination studies of G1T38 and 48, this might be a little bit premature, but I guess what would you be looking for to see in the early study of 48 to feel confident going forward with the combinations in the future? Thanks.

[Mark Velleca:]

Thanks, Joe. I’ll just answer the very first part of your question then hand it over to Raj. We do expect to have a continued ongoing discussion with both FDA and European regulators. We do have meetings scheduled this summer. We expect to be back in front of them early next year with the Phase 2 data from the ongoing trial. So that will be an ongoing dialogue and we will update you as appropriate.

[Raj Malik:]

Yes. And just to add, Joe that the data are very strong and we just want to get in front of the regulators to discuss the data. Our early meetings with them really were focused around the Phase 1 open label data. And so this is an opportunity to get in front of them with the robust model preservation benefits that we've seen. And as Mark mentioned, it's really an ongoing dialogue. We certainly can't comment on what the Phase 3 would look like. I mean that's obviously a matter of discussion with the agencies.

[Joseph Thome:]

Great. And then the final - sorry, which is on, what are you looking for with G1T48 to make you confident that it’s combinable? Yes.

[Raj Malik:]

Thanks. Yes. So the initial part of the 48 is the monotherapy dose escalation. So we'll be looking at safety, PK. But importantly, it also has a fast path component. So we’re going to be looking at what happens to reduction of the tracer uptake following administration of 48. And this has been used with other serves as you know. So we’ll be really looking at safety as well as PK as well as PD effects in defining the dose. And once we've defined the dose, the recommended Phase 2 dose, which will be likely sometime in ’19, that's what would trigger the combination with 38.

[Joseph Thome:]

Great. Thank you very much.

[Operator:]

Our next question comes from Dane Leone with BTIG. Your line is now open.

[Dane Leone:]

Thank you for taking the questions and we look forward to the data at ASCO. I just wanted to clarify kind of the context of some of the safety data. I appreciate the neutrophil count being looked at. But do you have a perspective on looking at some of the GI talks that we've seen with some of the other agents or a characterization on that front?

[Raj Malik:]

Yes. We will absolutely present that data, and you will see that as differentiated from really both of the agents, both Kisqali and (Parma) in terms of the safety profile. So yes, we'll be presenting GI tolerability data, which are more in line with palbo and ribo I should say.

[Dane Leone:]

Okay. And just to clarify because these early studies always scares me when response rates are promised and best in class is used. Could you just be kind of crystal clear in terms of for a cohort where you think patients are at a therapeutic dose level that will be presented at the meeting. How robust is that size of the cohort going to be and kind of relative follow up on that cohort specifically?

[Mark Velleca:]

Yes. Thanks, Dane. To be clear, we think based on everything we've seen with 38, that it has best in class potential. Also to be clear, the data at ASCO is going to be from dose escalation cohorts. So there should be no expectation that we're going to have a robust dataset on several patients who are at our go forward Phase 2 decks. That dose expansion phase will start enrolling we expect sometime middle of this year and complete enrollment by the end of this year, and it would be from those patients, those 30 patients that Raj alluded to, that you would expect to see robust efficacy rates.

[Dane Leone:]

Okay. And so those 24 patients you mentioned in the abstract, could you tell us what percentage of those patients would be understandably below what you consider a therapeutic dose level?

[Raj Malik:]

Yes. So Dane, this is Raj. I mean we are - we think we're getting close to the recommended Phase 2 dose. And so you can imagine that those patients have been on study the least in terms of duration. So most of the efficacy data from a longstanding perspective are - will be from lower dose levels. We also are testing once a day and twice a day cohorts in this study. So you'll see data on both of those cohorts as well. And we wanted to test that because of the shorter half life of the drug and just to make sure that there weren't clear differences between the two cohorts, or two schedules I should say.

[Dane Leone:]

Great. Thank you for clarifying that stuff. Much appreciated.

[Operator:]

Our next question comes from Chad Messer with Needham & Company. Your line is now open.

[Chad Messer:]

Great Good afternoon and thanks for taking my question and congrats on a very productive quarter. Well understood that your conversations with regulatory agencies are kind of an ongoing issue, but given that you kind of went out of your way to accelerate getting in front of them based on the strength of the trilaciclib data, just wondering if you could share with us any specific issues or questions or any objectives that you're hoping to get out of these initial meetings.

[Mark Velleca:]

I’ll just say - remind you, they’re not initial meetings. We have had prior dialogue of really good end of Phase 1 discussion last year. But I'll turn it over to Raj on expectations for feedback from these upcoming discussions.

[Raj Malik:]

Yes. So as you know Chad, the data are very compelling. It’s a novel mechanism of action with a multi lineage effects that we saw. And when you're going and doing something that is a little bit different, the more chances you have to get in front of the regulators and get a sense of how they’re thinking, really helps the development program. So that's really the main intention here, get in front of them and get their first of all reaction to the data, make sure that they're as excited as we are. And secondly. Obviously we’ll be talking about endpoints and things like that and getting their thoughts on our proposals. Okay, great. Thank you. And yes, I meant the upcoming. Sorry, I misspoke.

[Raj Malik:]

No, that's fine.

[Operator:]

At this time, I'm showing no further questions. I'd like to turn the call back over to Dr. Velleca for closing remarks.

[Mark Velleca:]

Thank you. Thanks all for joining the call. Please reach out to us, get any additional questions. Look forward to seeing many of you at ASCO and have a good evening.

[Operator:]

Ladies and gentlemen, thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.