Onconova Therapeutics, Inc.
Q1 2020 Earnings Call Transcript

Published: 15 May 2020

[Operator:]

Ladies and gentlemen, thank you for standby. And welcome to the Onconova Therapeutics' First Quarter 2020 Earnings and Corporate Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] As a reminder, this conference call is being recorded.I would now like to turn the conference over to your host Mr. Avi Oler, Senior Vice President of Corporate Development and General Counsel. Thank you, sir. Please go ahead.

[Avi Oler:]

Thank you, Operator. Good afternoon, and welcome to Onconova's first quarter 2020 corporate update and financial results conference call. Earlier this afternoon, we issued a press release outlining our financial results and business progress during the year. If you have not yet seen this press release it is available on the Investor Relations page our website, at www.onconova.com.On today's call, Dr. Steve Fruchtman, President and CEO, will discuss the company's recent highlights and anticipated clinical and business milestones. After Steve completes his opening remarks, Mark Guerin, our Chief Financial Officer, will review first quarter financial results.Following Mark's report, we will move to the Q&A portion of the call, which will be joined by Dr. Ric Woodman, our Chief Medical Officer. Lastly, Steve will come back with some final comments and a review of our upcoming milestones.Before we begin, I remind everyone that statements made today during this conference call will include forward-looking statements under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties that can cause actual results to differ materially.Forward-looking statements speak only as of the date they are made, as the underlying facts and circumstances may change, except as required by law, Onconova disclaims any obligation to update these forward-looking statements to reflect future information, events or circumstances. Please see the forward-looking statements disclaimer in the press release issued this afternoon. And the risk factors in the company's current and future filings with the SEC.With that, it is my pleasure to now turn the call over to Steve

[Steve Fruchtman:]

Thank you, Avi. Good afternoon, everyone and thank you for joining today's call. First, our hearts go out to the many individuals and families impacted by the devastating COVID-19 pandemic. The world has truly changed. And we hope that brilliant scientists from around the world can bring new therapies and preventions to this devastating plague.Onconova demonstrated significant progress during the first quarter of 2020, highlighted by the completion of enrollment of our pivotal Phase 3 INSPIRE trial in Higher-Risk Myelodysplastic Syndromes.We are fortunate to have achieved full enrollment, prior to the profound impact of the worldwide COVID-19 pandemic, which has forced disruptions to research studies at many hospitals and cancer centers across our globe.With enrollment now completed Onconova's pivotal Phase 3 INSPIRE trial is advancing to the next pivotal catalyst. Based on historical survival trends, in the INSPIRE trial, we continue to anticipate, reporting top line survival data in the second half of 2020.And, we expect to present the results of the INSPIRE trial at a major medical meeting, later this year. With INSPIRE enrollment now complete, we are preparing for when we reach 288 survival events before analyzing and releasing top line survival data.To shorten time lines for our anticipated NDA submission to the FDA, we have already begun NDA work prior to data readout. We are working with regulatory consultancy experts on our NDA document for the U.S. FDA, as well as on the MAA document for the EMA to be in position to expedite our health authority applications when data becomes available.We are also advancing our plans to be ready for commercialization. And to develop internal Onconova expertise, we have nominated a commercial expert Ms. Terri Shoemaker to our Board, who was instrumental in the commercialization of azacitidine, the most frequently prescribed pharmaceutical agent in higher-risk MDS.As you recall, INSPIRE is an open-label randomized controlled international study designed to determine the efficacy, safety and tolerability of single-agent intravenous rigosertib in the treatment of patients with second-line high-risk MDS. Patients in this study are less than 82 years of age and have progressed on relapsed or failed to respond to previous treatment with the standard of care hypomethylating agent therapy. The study randomized patients to receive either intravenous rigosertib with best support of care or the physician's choice of therapy with best support of care.The primary end point of this study is overall survival of all randomized patients in the intent-to-treat population. There is also a second opportunity for an FDA approval which is the sequential analysis of the overall survival of the very high-risk subgroup as defined by the revised International Prognostic Scoring System.Should rigosertib prolonged survival in the INSPIRE trial in a statistically significant manner, we believe rigosertib could be the first new treatment for higher-risk MDS in more than 15 years. Today we disclosed that at the European Hematologic Association's upcoming virtual congress, Onconova and our collaborators at MD Anderson Cancer Center and the centers participating on the INSPIRE trial have an accepted presentation.The presentation which was just posted to the European Hematology Association's website detail the impact of the RAS pathway mutations on patients failing azacitidine and is entitled Mutations in RAS Pathway Genes Correlates with Type of Failure to Azacitidine

[Mark Guerin:]

Thanks, Steve and good afternoon, everyone. Cash and cash equivalents as of March 31, 2020 totaled $31 million, compared to $22.7 million as of December 31, 2019. As previously noted, common stock warrant exercises since our financing transaction in November 2019 have added $10.6 million of cash to our balance sheet.Also of the almost 29 million stock warrants outstanding as of March 31, 2020 over 80% of them were in-the-money as of May 13. Based on our current projections, we expect that our cash and cash equivalents will be sufficient to fund our ongoing trials and operations into the third quarter of 2021.Our net loss was $5.1 million for the quarter ended March 31, 2020 compared to $7.6 million for the comparable period in 2019. Research and development expenses were $3.4 million for the quarter ended March 31, 2020 and $4.1 million for the comparable period in 2019. General and administrative expenses were $1.8 million for the quarter ended March 31, 2020 and $3.2 million for the comparable period in 2019.This completes my financial review. I'll now turn the call back to Steve.

[Steve Fruchtman:]

Thank you so much, Mark. With that, we'd like to open the call for questions. After the Q&A, I'll finish with some final closing remarks. Operator, please open the call to Q&A session and thank you.

[Operator:]

Sure, sir. [Operator Instructions] Our first question comes from the line of Joe Pantginis with H.C. Wainwright. Your line is now open.

[Joe Pantginis:]

Hey, guys. Good afternoon. Thanks for taking the question. Glad you're all doing well. So I have three questions, two of which I think are pretty much logistical. The first one is with regard to INSPIRE, it's great that you enrolled everyone right now and things are progressing and the time lines are still on track. So I was just curious as part of your -- I guess, call it your statistical assumptions now with COVID is there a potential for any loss to follow-up for any of these patients that you might not hear about some of these events? Or is it not a concern?

[Steve Fruchtman:]

I'll ask Rick to take that question and thank you, Joe.

[Ric Woodman:]

Yes, Joe. Thank you. The main challenge with the COVID pandemic for our global study has been monitoring of the sites. Fortunately, the number of patients in which we are not able to confirm survival events is extremely small. And we anticipate that continuing in part due to the efforts of our CRO and the clinical research assistance in the field and the team in Onconova as well as some good luck. And I think that we anticipate for the remainder of the collection of survival events that we will be able to continue doing that monitoring. But it is a challenge and the monitors and the team have -- had to develop unique ways in which to interact with the sites because of the pandemic.

[Joe Pantginis:]

Got it, Ric. Thank you for that. And then my second logistical question, if you will. I know we discussed this in the past, but sometimes it lapsed, and I just want to make sure if your thinking is still the same with regard to the communication strategy around putting out the data for INSPIRE. So since you're looking to present them at a major medical meeting in the second half, I'll just say presumably ASH, would you look to then have one of those typical top line press releases to say, okay, it hit and we'll give the further data at an upcoming conference? Or not hit as...

[Steve Fruchtman:]

Avi, why don't -- I'll ask Avi to take that one if I may. Go ahead, Avi.

[Avi Oler:]

Sure. Sure Steve. In terms of communication Joe, thanks for the question, but you're exactly right that we would anticipate announcing the data when it is ready at a top line level, and presenting full data at an upcoming major medical meeting such as ASH or another major medical meeting.

[Joe Pantginis:]

Got it. And then my question is -- or my third and last question. With regard to the upcoming Type C meeting, obviously, you've already had a lot of productive discussions with the FDA around the study design. So I guess I would ask it two ways. What's your wish list of what you want to get out of there? And what are the key outstanding things that you need to get solidified?

[Steve Fruchtman:]

Ric?

[Ric Woodman:]

Yes, Joe. So I think the first part to your question is that we want to get agreement from the FDA on a novel unique adaptive design, a combination of a Phase 2/3. And this adaptive design we presented at ASH and some of the unique features. We feel this design is particularly advantageous for us in a variety of ways as well as the medical community and the health authorities. And I think the additional challenge that we have is developing, particularly as we indicated in the abstract at ASH, a very rigorous and robust interim analysis that allows us to move forward into the Phase 3 part of the study.

[Joe Pantginis:]

Got it. Thank you, very helpful guys, and stay well.

[Steve Fruchtman:]

Thank you, Joe.

[Operator:]

Your next question comes from the line of Naureen Quibria with Maxim Group. Your line is now open.

[Naureen Quibria:]

Hi. Thanks for taking the questions. So first, I guess starting first with INSPIRE. Can you remind us or are you able to disclose what the current event rate is right now? And is there an average number of events that you're seeing per month? Are you able to discuss that in any detail?

[Steve Fruchtman:]

I think I'll try my hand at that, and thank you very much. We did reveal, I believe, mid-March that we have over 85% of our survival events that we require of the 288. And the reality is it's quite variable. We do monitor by month every -- the survival events that we see it is variable. But based on what we are observing, we anticipate reaching pivotal data the second half of 2020, so before the end of the year. It's harder -- it's very hard to make a more accurate prediction than that.

[Naureen Quibria:]

Got it. That makes sense. And so I have a really broad sort of theoretical question, my next one. And that's regarding your second study with rigosertib. The treatment regimen in MDS, high-risk MDS landscape, seems to parallel that of AML. And in AML, the combination with venetoclax and a hypomethylating agent is part of the treatment paradigm and at least as a treatment of choice for a select group of patients.Now, if we were looking at the data at ASH last year, there was a study that posted positive response rates in high-risk MDS with venetoclax and azacitidine. But rigosertib with aza actually posted numerical higher response rates in the same patient type, if I recall correctly, and that was also at ASH. Since doctors are familiar with venetoclax and since that data was positive, what are your thoughts about where you think rigosertib may be placed in this patient type? And in terms of strategy if say venetoclax gains approval well in advance, would that alter your current strategy?

[Steve Fruchtman:]

Ric?

[Ric Woodman:]

Well, thank you for your question. I think that there's a couple of aspects to that question and I'll deal with each of them individually. First and foremost is that the -- venetoclax is ineffective as a single agent in AML or MDS. And so venetoclax needs a partner compound. I think it's clear the field is looking for doublet therapy. And to really effectively achieve that they need agents that have differing mechanisms of action and in fact can be administered easily for patients.So we are looking at the potential and I think the field would look at the potential for any agents that can be combined orally. And this is why our Phase 2 data with oral rigosertib is so important, because it satisfies at least many of the features you would look for in a doublet combination

[Naureen Quibria:]

Got it. That's really, really helpful. And just one last question. With regard to the planned study with the CDK4/6 in the U.S. you mentioned that the IND will be filed or submitted in the fourth quarter. I was just curious has the study design been formalized? Will you start with the monotherapy and then a combination with say letrozole? Can you discuss a bit more about that program?

[Steve Fruchtman:]

Ric?

[Ric Woodman:]

Yes. So I think, first of all, we anticipate that ON 123300 will potentially has the mechanism of action that could be effective in multiple tumors. It may be effective in the current conventional CDK4/6 inhibitors patients that are resistant to those agents. It will most likely need to be combined with some sort of hormonal therapy as is currently given particularly if it were to be moved to earlier lines of therapy.

[Naureen Quibria:]

Got it. Okay. Thank you. That's helpful. That's it for me.

[Steve Fruchtman:]

Thank you.

[Operator:]

Your next question comes from the line of Ahu Demir with Noble Capital. Your line is now open.

[Ahu Demir:]

Hello, everyone. Thank you very much for taking my question. My first question will be on commercialization of rigosertib efforts. What do you plan to do? When do you plan to initiate? And what do you think the financial impact would be on that front?

[Steve Fruchtman:]

Mark, I heard the word financials. Would you like to take that?

[Mark Guerin:]

Yes, Steve. Thanks. I'll be happy to. And Ahu, thanks for the question. While we're not able to provide any specific information about what we have spent so far or precisely what we plan to spend between now and top line data and then afterwards. I can tell you that, we started our pre-commercialization readiness activities earlier this year. And as you might expect, our initial focus was on the longer time line pre-commercial activities. So once we got to full enrollment, we undertook that initiative with a focus on the long time line things. I hope that that answers your question. If it doesn't please feel free to follow-up and I can try to answer a follow-up question.

[Ahu Demir:]

Sure. That's helps, Mark. Thank you very much. My other question would be on the RAS program Steve preventing to open clinical trials say ,do you imagine the RAS lung cancer trial will initiate right away? Or are there any other things that you need to accomplish prior to starting it?

[Steve Fruchtman:]

Ahu, thank you for that. The site is ready to go meaning this trial is IRB approved and we – and the site is ready to put patients on to this Phase 1, but all new clinical research is on hold as the pandemic impact on academic medical centers, hopefully is reduced or mitigated. We hope that cancer research – clinical cancer research will be restarted. And once that happens, we anticipate the patients who are already being screened for this study will be put on to this new study.

[Ahu Demir:]

That's great. Thank you. And one last question – Steve do you have something to say Steve?

[Steve Fruchtman:]

No. I was just saying we're obviously very eager to get it started. So I think it's all ready to go.

[Ahu Demir:]

All right. That's great. My last question on the CDK program. So considering you expect to do the submission in the fourth quarter, do you expect any delays driven by COVID and manufacturing issues or any other delays we expect? So is this still on track to be on Q4 2020?

[Steve Fruchtman:]

So I'll take that. We don't expect any – we have a manufacturer identified. They have to do validation of the manufacturing processes. We don't expect any delays regarding that from the COVID pandemic. We already have a Phase 1 site identified. Again, that's a bit of an unknown, because we don't know what's going to happen to the hospital system and the restarting of clinical cancer research. We hope and pray by the end of this year when we anticipate possibly the Phase 1 trial with ON123300 being started that clinical cancer research will be open again and then our trial will be one of the studies across the U.S. that gets restarted.

[Ahu Demir:]

Okay. Great. Thank you very much for taking my questions.

[Steve Fruchtman:]

Thank you, Ahu.

[Operator:]

Your next question comes from the line of Yale Jen with Laidlaw & Company. Your line is now open.

[Yale Jen:]

Good afternoon and thanks for taking the questions. My first question is regarding the COVID-19 impact. First of all, does that have any impact for the INSPIRE study in terms of patient receiving treatments? Any interruption or any impact on that even though they all have been enrolled?

[Steve Fruchtman:]

Ric?

[Ric Woodman:]

Thank you for your questions. So first and foremost that, we do not anticipate any differences in the impact of COVID-related illness on the investigational arm patients treated with rigosertib versus the physician's choice arm. At the present time, and we've been monitoring very carefully the COVID impact on our global sites and centers and to date, we've not seen any real dramatic impact on anything other than collection of data and monitoring.And that's more due to the impact of COVID on the care that's happening at the various sites site staff. In some places site staff who are involved in studies do not have access to the hospital and this obviously impacts our ability to work with them in collecting data. We are finding novel ways as permitted by local health authorities to do that. And to date we've been very successful in doing that. And as Steve mentioned in his outset, we achieved enrollment of the 360th patient in our target enrollment on March 17. So, everyone is enrolled. It's now a matter of following all of these patients.

[Yale Jen:]

Okay. Great. That's very helpful. And that's very good for the execution. The next question I have probably is a little bit sort of unfortunate situations. Just curious given that most of the patients are LV and you say the average age -- median age is 82, do you anticipate or speculate I should say that the morbidity -- the co-morbidity will play into this and the time line unfortunately or fortunately in this case might be shortened for you guys to get to the 388 number?

[Steve Fruchtman:]

So, I'll take that one. So I just want to correct Yale, the eligibility criteria is under the age of 82. It's not a median age of 82. The median age of MDS is in the late 60s. So, with that said, we don't anticipate any impact of COVID-19 because it's a well-powered trial. And we are also at the major medical centers across the globe. And MDS patients obviously do develop pneumonia, but Rick and his team are monitoring and the centers are checking if a patient with MDS on INSPIRE has a pneumonia they are checking for the evidence of COVID-19. So that is continuing. And in a well-powered trial since COVID-19 may impact on both arms, we don't believe that it should impact on the final outcome of the trial.Of interest and I can't say I understand it, ASH just published their survey of 111 patients with hematological malignancies who had COVID-19 that caused their death. And despite all of the patients 111 having a hematological malignancy there is no MDS patients identified in that cohort. I can't say I understand that data, but that's the data from ASH. And we don't anticipate to summarize that COVID-19 should impact on the pivotal data that we anticipate from the INSPIRE trial in the second half of 2020.

[Yale Jen:]

Okay. Great. That -- I appreciate the explanation. And maybe the last one is that given -- I mean -- should the data be positive and -- first of all, I didn't get what time you might be able to file that. Would that be in 2021 or even late or maybe second half of 2021? Secondly, is that in terms of manufacturing particularly CMC all these aspects, how does the company intend to manage that at this moment?

[Steve Fruchtman:]

Regarding -- I think Yale what you're asking is about the time lines for our NDA application. So, we anticipate, once we flip the card and hopefully have positive data, we anticipate it will take us -- because we already mentioned that we're doing a pre-NDA work already, we're not waiting to flip the card. A lot of CMC materials, toxicology materials can all be ready start to be written. But once we flip the card and have hopefully positive data, we anticipate a time line of seven to nine months to submit our NDA application for IV rigosertib.

[Yale Jen:]

And the CMC part of -- you mentioned that, it's already in the process of checking them and making repeated batches or intend to make repeated batches to confirm, the uniformity of the product.

[Steve Fruchtman:]

That is correct. We have just in case, you didn't know a full-time CMC expert on our staff at Onconova, who is leading those efforts to make sure that our CMC to meets all regulatory requirements and is looking into initiating the writing of that part of the NDA. There's no reason to wait for the pivotal data to be read out. We can start that work already and we have.

[Yale Jen:]

Okay. Great. Thanks a lot. And everybody take care. And we look forward to see the data very soon.

[Steve Fruchtman:]

Thank you, Yale.

[Operator:]

That concludes our Q&A session for today. I will now turn the call over back to Mr. Steven Fruchtman, for closing remarks.

[Steve Fruchtman:]

Thank you so much. And thanks to all of you for participating on, today's update call. We're obviously very excited about the progress we have made, with IV rigosertib and our pipeline programs overall. I hope you feel. And share our enthusiasm.Important milestones we look for in the near and medium-term include. And this listing is in no particular order. First, our EHA presentation, based on the genomics data from the INSPIRE trial.Second, initiating enrollment on the Phase 1/2a trial of rigosertib plus nivolumab, in KRAS-mutated, advanced non-small cell lung cancer, as an investigator-initiated study.And third, beginning a Phase 2/3, combination study of oral rigosertib plus azacitidine, in HMA naïve higher risk MDS patients following the INSPIRE data readout. Fourth, U.S.A. IND submission, of ON 123300, during the fourth quarter of 2020, followed by a clinical trial initiation, and number five, and most importantly which gives us great enthusiasm, during the second half of this year, the release of top line survival data from the INSPIRE trial, after reaching 288 survival events.In closing, I encourage all of our stockholders to attend our upcoming Annual General Meeting of Stockholders later this month, on May 27. We truly appreciate your continued interest in all of our programs, at Onconova. Should you have any additional questions, please feel free to contact us. Please stay safe. And thank you all for your participation. Operator, you may now end the call.

[Operator:]

Ladies and gentlemen, this concludes our conference for today. Thank you for participating. You may now disconnect.