Strongbridge Biopharma plc
Q1 2020 Earnings Call Transcript

Published: 10 May 2020

[Operator:]

Good morning, ladies and gentlemen. And welcome to Strongbridge Biopharma's First Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen only mode. As a reminder, today's conference call is being recorded. Now, I'd like to turn the conference over to your host, Lindsay Rocco of Elixir Health Public Relations.

[Lindsay Rocco:]

Thank you, and good morning, everyone. We are pleased that you could join us for Strongbridge Biopharma's first quarter 2020 earnings conference call. Joining me from Strongbridge this morning are John Johnson, Executive Chairman; Dr. Fred Cohen, Chief Medical Officer; and Rob Lutz, Chief Financial Officer.

[John Johnson:]

Thanks Lindsay. Good morning, everyone. And thank you for joining us today. To begin, I would like to extend our organizations gratitude to the healthcare professionals and first responders who are bravely serving on the frontlines at such an unprecedented and challenging time. Our collective thoughts are also with the individuals and their loved ones who have been directly impacted by the Covid-19 global pandemic. This pandemic has also posed many challenges in ensuring the continuum of care for many people living with chronic conditions, including rare disease. Our team has been working tirelessly over the last several weeks to ensure minimal disruptions for the patient and physician communities that we serve. Importantly, we are pleased to have an unaffected supply chain of our medicines, and we do not anticipate any shortages due to the global pandemic. The team's dedicated efforts guided by the impressive leadership of Fred Cohen, our Chief Medical Officer, most notably extends of supporting our Phase III LOGICS study, which has continued to progress on track despite having site in highly affected areas. This is in large part due to the ingenuity and commitment of the many stakeholders involved. Today, we were delighted to announce that 41 of 42 targeted study participants have completed the randomized withdrawal phase of the Phase III LOGICS study. There's one additional patient currently in the randomized withdrawal phase and one other patient scheduled to be randomized imminently. Enrollment will close on or before May 14. We are incredibly pleased to reach this important milestone in our clinical development program for RECORLEV, a therapeutic candidate which if approved we believe has the potential to play an important role in the treatment of endogenous Cushing's syndrome given that the unmet medical needs remain very high for this rare endocrine disorder. The company continues to anticipate reporting top-line results from LOGICS during the third quarter of 2020 barring any unanticipated impact due to the Covid-19. Shortly, Fred will speak to the key actions we have undertaken to maintain this timeline.

[Fred Cohen:]

Thank you, John. Before turning to the specifics related to the progress of our RECORLEV clinical development program, I would like to thank all of the stakeholders who have been integral in our ability to keep the Phase III LOGICS and optic studies going despite the growing pandemic. Our employees, the study participants and research staff, our contract research organizations and our vendor partners have been working together during this global health crisis to mitigate the impact to our research and development efforts. While many other organizations have had to delay or stop their clinical programs altogether, we have been fortunate that innovative measures have allowed us to continue to make progress in the LOGICS trial. Specifically in partnership with our clinical trial sites, measures such as home health visits, special transportation arrangements, telemedicine, direct-to-patient drug supply delivery and regulatory authority sanctions protocol and monitoring flexibility are proving to be instrumental in helping investigators and study participants, safely complete the required visits for the study. As John mentioned, we are excited to be closing enrollment in the Phase III LOGICS study on or before May 14th. Please recall that LOGICS is a double-blind placebo-controlled randomized withdrawal study comprised of four phases. Screening, titration maintenance, randomized withdrawal and restoration. The primary endpoint comes at the end of the randomized withdrawal phase. Our top-line results will consist of data through the end of this phase. As of today, the LOGICS study has 41 of 42 study participants who have completed the primary endpoint. There is one additional patient currently in the randomized withdrawal phase progressing towards completion. And one other patient scheduled to randomize imminently. In the event that the final patient awaiting randomization is not able to be randomized on or before May 14th due to logistical or other issues, enrollment will close by that date. Recall that the logic protocol allows for a range in the targeted participant sample size for enrollment. This range is dependent on the observed rate of discontinuation in randomized withdrawal, which determines the number of primary endpoint completers. The protocol targets approximately 42 primary endpoint completers providing approximately 99% power to detect the loss of therapeutic response rate of 70% in the levoketoconazole arm and 78% in the placebo arm versus the null hypothesis.

[Rob Lutz:]

[Operator:]

Our first question comes from the line of Justin Kim with Oppenheimer.

[Justin Kim:]

Hi. Good morning. Congrats on the quarterly progress and thanks for taking a question. Just a few for me on the update for KEVEYIS guidance due to Covid-19. Could you share any thoughts on seasonality or color around that guidance? Do you expect those uncertainties and impact to be more strongly felt in 2Q rather than other period?

[John Johnson:]

Yes. Thanks for the question. First off, let me say we were really pleased with the exceptional performance of the team in the first quarter. And in particular the 54% year-over-year growth. Our adherence rates have been really strong, discontinued rate very, very strong and we feel really good about our business overall. What it's important to remember about KEVEYIS is that a lot of those patients are treated locally, most patients in fact and there's not a center of excellence that they tend to go to and so it requires reach out to a lot more physicians to familiarize them as each patient begins to get enrolled. And so for us, we've seen a drop in the new patient starts due to the face-to-face interactions.

[Justin Kim:]

Okay. Got it. That makes sense. Maybe then on LOGICS spread just wondering if you had any discussions with regulators on some of the secondary endpoint benefits in SONICS and how the design of LOGICS might be able to or not be able to explore those points?

[John Johnson:]

Yes. So I'm not going to get into specifics of our FDA interactions. What I will say is a couple things. Number one, if you look at some recent FDA approvals by this division particularly have a look at the Isturisa label, which is the latest approval in Cushing syndrome you'll see some mention of secondary endpoints in their clinical study section. And that has been seen with some prior labels as well. So I'll leave that, I'll leave you to interpret what that might mean. I will say that in the LOGICS study and this will be detailed in our poster for endo. We are studying secondary endpoints that we thought could react in a timeframe consistent with the length of the randomized withdrawal phase of the LOGICS study which is the double-blind placebo control portion which as you may recall is nominally eight weeks long. And so you're looking for sort of fast reacting endpoints things like glucose, body weight to some extent and so we're looking at those secondary endpoints and certainly if they can hit within that eight-week time frame to show reversal when switching to placebo that would be a nice confirmation of those benefits that we saw in the open label SONICS study. And so we will be reporting with the top line results on some of those three endpoints as well.

[Justin Kim:]

Okay. Great. And just maybe just a last point on some of the pair work that's being done. Do you have any color around round what constitutes sort of failure and tolerance and some of those stuff that are placed on the currently available branded products and how that may or may not change with Isturisa's commercialization.

[John Johnson:]

Fred do you want to take that?

[Fred Cohen:]

Step edits in terms of Isturisa's, well, at this point, I don't think we have enough color into what these step edits are going to look like for access to Isturisa's could because it hasn't been launched yet in the United States, I think and maybe Rob can speak to this more but in terms of what we've seen for the other commercial products in the United States for the most part, step edits are not a major feature of accessing those commercial products typically. What's needed is attestation that another product has been tried and failed in some cases; in some cases there's no such attestation needed. So we'll have to see what Isturisa's step edits look like once that gets established in the US market. Rob, I don't know if you had any thing to add on to that.

[Rob Lutz:]

No. Well said, Fred. I think that covers it.

[Operator:]

Our next question comes from the line of Roger Song with Jefferies.

[Roger Song:]

Hey, good morning, guys. Congrats on the strong Q4 KEVEYIS and the closed enrollment, close to the enrollment completion for LOGICS. So maybe just a few quick ones from me. So well first I think, Fred, you mentioned since the drop out rate is lower than expected. I'm just curious do you have any color on to what might drive this lower kind of dropout rate like a lower AE or et cetera?

[Fred Cohen:]

Sure. So just as a reminder, we took a pretty conservative approach when determining the expected dropout rate and the sample size targets to ensure that we would have enough flexibility to enroll more patients if we needed to. Because we definitely wanted to make sure that we had an adequate number of completers having targeted 42 completers. So the fact that we didn't need to enroll for any very many more patients above the targeted completer number is very welcome news. And probably the most important factor that led to the low dropout rate at least lower than expected with our decision to provide for early rescue therapy in randomized withdraw as soon as it was considered to be needed and confirmed to be needed by biochemical markers and other markers of physical signs and symptoms of the disease returning. So the use of that rescue therapy provided some reassurances to patients and the physician investigators who are caring for them. That it would not be necessary to leave the study should the disease signs and symptoms recur during the treatment in the blinded randomized withdrawal phase. The other key factor I think is that all the subjects who entered into the randomized withdrawal phase had already experienced at least 14 weeks of therapy and they all had achieved a tolerated therapeutic dose and so now looking back on the SONICS results we know that once you've achieved a therapeutic dose and have been on the drug for some time such as three to four months that the incidence of adverse events that lead to discontinuation diminishes over time. So I think if we had wanted to be less conservative we could have bargained for lower dropout rate, but as it was we were very pleased with what we saw.

[Roger Song:]

That's very helpful. Thank you. Maybe just quick follow-on questions for that. So regarding the only use the rescue med such as can you kind of remind us how you're going to kind of accommodate to the primary endpoint analysis for those kind of patient used to rescue med?

[John Johnson:]

Yes. So anyone who takes a rescue medication by virtue of having met the criteria for early rescue is considered having lost response in the primary endpoint. So they will be counted in the column of loss of response. Now what that may mean is that we will have some patients who are on active therapy losing response and we did account for that in our study power. In other words losing response even if it's maybe just a transient. And then we do expect a very high proportion of the placebo switch patients to lose response and need early rescue.

[Roger Song:]

Got it. Yes. So and many of those patient are from placebo arm, okay, got it. Okay and then so for the NDA submission you're guided a six month after the top-line data and can you kind of remind us what else need to be done besides the LOGICS data like --

[John Johnson:]

So I think what we said before is that the LOGICS study is really the rate limiting step for an NDA submission. So preparing the LOGICS study results in a format suitable for submission and to some extent integrating those results with results from prior studies. And it is going to be really the rate limiting step to filing the submission.

[Roger Song:]

Got it. Great and the maybe just the last quick one. So we know you have been kind of contemplating lifecycle management strategy for KEVEYIS. So just any kind of evolving thinking along that and when we're going to see that kind of come up.

[John Johnson:]

Yes. So I think what we talked about on the last call is that we have filed 14 patent applications in the United States around KEVEYIS and as well as three PCT global patent applications. All the two of those belong to four primary families of patents and all of these relate to the current product labeling for KEVEYIS. So we continue to prosecute and advance these patent applications with the respective offices. And we expect to give an update in the second half of this year on our progress there. In addition, we've continued to advance the modified release formulation of KEVEYIS. We talked about in our last call, we're not prepared today to discuss any results from that, but we're pleased with progress.

[Operator:]

Our next question comes from the line of Liisa Bayko with JMP Securities.

[Unidentified Analyst:]

Hi, guys. This is John on for Liisa. Thanks for taking the questions. Just one on kind of your market research. Are you including is Isturisa's profile when you kind of talk to docs and payers and I guess can you kind of give us your thoughts on how we're quarterly shaping out compared to Isturisa's.

[Fred Cohen:]

Sure. Yes. We did include their profile in the market research. We did. So all of the data that Scott discussed on the last call was in fact included when we did the market research with physicians and so we're not going to get into specifics about how we stack up or our strategy. But to say that we're very comfortable with the fact that there will be good acceptance for RECORLEV, it certainly has a place and I think the important thing to keep in mind is that of the 8,000 patients that are treated today by the use of these medicines by prescription about 3,800 are not well satisfied and not well controlled and so there remains strong unmet need that we believe that we'll continue to see that when RECORLEV, if approved gets to the market. But the direct answer to your question is yes in all of our market research we included their profile.

[Unidentified Analyst:]

Okay. Great. And, Fred, can you remind us how often patients are being measured for urinary cortisol during the randomized withdrawal and I heard you talk about kind of your expectations for loss response. Can just go over that one more time?

[Fred Cohen:]

Yes. So I think what I mentioned in the call script was the original power, powering assumptions for the study and just to remind you what those were that we were targeting approximately 42 primary endpoint completers, which would provide approximately 99% power to detect a loss of therapeutic response rate of 70% in the levoketoconazole arm and 78% in the placebo arm versus the null hypothesis. We are looking frequently at both USC as well as late-night salivary cortisol. UFC is the primary determinant of the loss of response in the --for the primary endpoint and the interval is approximately 10 days, every 10 days during the randomized withdrawal period.

[Unidentified Analyst:]

Great. And just one last book keeping, what was gross net for the quarter for KEVEYIS and then what are your expectations for the year? And thanks again.

[Rob Lutz:]

Yes. John, this is Rob. Yes. So the gross net was in the 25% range for the quarter. And that is Q1 gross net is usually higher than the rest of the year. So we always expect some moderation. In Q1, we see no patients no starting up again with their insurance plans. So it can be at higher deductibles and co-pays and the things that affects some of our gross net. And so we typically see higher and so will expect the moderate down backward or usual which is more like low 20s, if you will.

[Operator:]

Thank you. I would now like to turn the call back over to Executive Chairman, John Johnson for closing remarks.

[John Johnson:]

In closing on behalf of the organization, I would also like to thank the biotech and pharmaceutical companies working towards developing Covid-19 vaccines and treatments for their efforts in responding to this global health emergency. This is a unique opportunity for our industry to demonstrate the incredible value that scientific rigor and talent can create for the global health community. Through transparency, collaboration and compassion, I believe that we can mitigate the impact of this virus poses in the near term and ultimately eliminate its threat in the future. In the meantime as the situation continues to evolve, our primary focus will remain on the health and safety of our employees and the patient and physician communities that we serve. This is a challenging time in so many ways but I have been truly humbled by the spirit in which our nation and communities have come together to support one another. Strongbridge has committed to supporting national Covid-19 relief efforts including making a charitable contribution to the American Nurses Association, Covid-19 Response Fund. We know there is a long road ahead and we will continue to help one another during this unprecedented time. Thank you again for joining today's call and for your continued support as we prepare for a number of key milestones in the coming terms and the coming months. Thank you.