Corvus Pharmaceuticals Q4 2023 Earnings Call Transcript

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March 19, 2024

There are 9 speakers on the call.

Operator

Good afternoon, everyone. Thank you for standing by, and welcome to the Corvus Pharmaceuticals 4th Quarter and Full Year 2023 Business Update and Financial Results Conference Call. At this time, all participants are in a listen only mode. It is now my pleasure to turn the call over to Zach Kubo of Real Chemistry. Please go ahead, sir.

Speaker 1

Thank you, operator, and good afternoon, everyone. Thank you for joining us for the Corvus Pharmaceuticals 4th quarter and full year 2023 business update and financial results conference call. On the call to discuss the results and business updates are Richard Miller, Chief Executive Officer Lace Lee, Chief Financial Officer Jeff Arquera, Chief Business Officer and Ben Jones, Senior Vice President of Regulatory and Pharmaceutical Sciences. The executive team will open the call with some prepared remarks followed by a question and answer period. I would like to remind everyone that comments made by management today and answers to questions will include forward looking statements.

Speaker 1

Forward looking statements are based on estimates and assumptions as of today and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by those statements, including the risks and uncertainties described in Corbus' Annual Report on Form 10 ks, which was filed today with the SEC and other filings the company makes with the SEC from time to time. The company undertakes no obligation to publicly update or revise any forward looking statements except as required by law. With that, I'd like to turn the call over to Laith. Laith?

Speaker 2

Thank you, Zach. I will begin with a quick overview of our Q4 and full year 2023 financials and then turn the call over to Richard for a business update. Research and development expenses in the Q4 of 2023 totaled $4,000,000 compared to $4,100,000 for the same period in 2022. R and D expenses for the full year 2023 totaled $16,500,000 compared to $24,500,000 for the full year 2022. The net loss for the Q4 2023 was 6 point $7,000,000 including a $1,400,000 noncash loss related to Angel Pharmaceuticals, our partner in China.

Speaker 2

This compares to a net loss of $9,800,000 for the same period in 2022, which included a 4.6 $1,000,000 noncash loss related to Angel Pharmaceuticals. The net loss for the full year 2023 was $27,000,000 including a $5,300,000 noncash loss related to Angel compared to a net a net loss of $41,300,000 including a $10,000,000 noncash loss related to Angel for the full year 2022. Total stock compensation expense for the Q4 and full year 2023 was $600,000 $2,100,000 respectively, compared to $600,000 $2,700,000 in the same periods in 2022. As of December 31, 2020 3, Corbus had cash, cash equivalents and marketable securities totaling $27,100,000 as compared to $42,300,000 at December 31, 2022. I will now turn the call over to Richard, who will discuss our clinical progress and elaborate on our strategy and plans.

Speaker 3

Thank you, Leif, and good afternoon, everyone. Thank you for joining us today for our business update call. Corvus has become a pioneer in the research and development of ITK inhibition as a new therapeutic modality to benefit patients with a diverse range of diseases. We have demonstrated that selective inhibition of this target leads to significant biologic effects that could lead to new treatments for cancer and immune diseases. In 2024, we are focused on 2 key value drivers to further confirm and advance this opportunity.

Speaker 3

1st, begin patient enrollment in a registrational Phase 3 trial of socolitinib for patients with relapsed PTCL or peripheral T cell lymphomas, an indication with no fully FDA approved therapies and significant unmet need. And second, begin patient enrollment in a placebo controlled Phase 1 trial of which is expected to generate the 1st clinical data for ITK inhibition for an immune disease before the end of the year. We believe Corvus is positioned to build value in the near term with significant upcoming clinical milestones for sopolitinib in oncology and immune diseases, further strengthening our ongoing business development, which is concentrated on partnering opportunities for ITK inhibition. Recently, published data demonstrated the potential role of ITK in a broad range of indications And we have expanded our capabilities and approach to business development with the appointment of Jeff Arquera as Chief Business Officer. Jeff will be presenting his views and strategy in a moment.

Speaker 3

I will now provide further details on our two priorities for the year and our other programs, starting with socolitinib for PTCL. We plan to begin patient enrollment in our socolitinib registrational Phase 3 clinical trial in relapsed PTCL in the Q3 of 2024. The data from Phase 1 trial continues to evolve with longer follow-up of treated patients. In the most recent data cutoff from January 2024, we found that a patient with previously reported partial response of approximately 80% target lesion reduction after 9 weeks of therapy, subsequently converted to a complete response at 18 weeks due to continued tumor response. This patient who remains on therapy had relapsed extranodal NK T cell lymphoma involving the nasopharynx and represents the 4th complete response out of 21 Phase 3 eligible patients in the trial.

Speaker 3

The objective response rate or ORR for the Phase 3 eligible patients in the Phase 1 trial remains at 7 out of 21 patients with 4 CRs and 3 PRs or 33%. Although not studied head to head, the ORR, complete response rate, disease control rate, progression free survival and overall survival for this group compares favorably to the results seen with belinostat or pralotrexate, which are the standard chemotherapies for PTCL and that we will be comparing against in a Phase 3 trial. These agents received accelerated approval in the United States, but no definitive trial has been conducted for either. The median PFS progression free survival for our patients and the primary endpoint for our Phase 3 trial remains at 6.2 months, which is substantially better than reported for the standard agents. Regarding our interactions with FDA, we reached alignment on the final study protocol and in February they granted focolitinib orphan drug designation for the treatment of T cell lymphomas.

Speaker 3

This is an important milestone that reinforces the unmet need for new therapies for these patients given existing drugs provide limited efficacy and are associated with significant toxicity. In fact, current NCCN guidelines for relapsed refractory PTCL recommend that patients enter an experimental clinical trial as the preferred treatment for second line therapy. Working with or are in advanced discussions with a number of leading centers in the United States and Canada. We anticipate about 40 centers will participate in the trial. The vast majority will be in the U.

Speaker 3

S. Our second priority is socolitinib for atopic dermatitis, the first immune disease indication we are exploring. Our plans to move into a clinical trial are supported by our preclinical work, including using Sokolitinib to successfully treat spontaneous canine atopic dermatitis. We are on track to initiate a Phase 1 trial in April. We plan to enroll 64 patients with moderate to severe atopic dermatitis that has progressed on at least one prior therapy.

Speaker 3

The study will be randomized, placebo controlled and blinded to patients and the treating physician. There will be 4 sequentially enrolled cohorts of 16 patients with patients in each cohort being randomized 3:one to different dosing regimens of socolitinib or placebo administered for 28 days. The primary endpoint is safety and tolerability and efficacy will be measured using investigator global assessment and the clinically validated measurement of improvement in eczema area and severity index, also known as EASI, EASI. It should be noted that while the atopic dermatitis trial is double blind, patient and doctor are blinded, but the company is not blinded. We plan to evaluate the data in an ongoing manner as successive cohorts of patients complete enrollment.

Speaker 3

Based on the anticipated enrollment and follow-up timelines, we believe data from the initial cohorts will be available before the end of 2024 with study completion in early 2025. We are planning to conduct a solid tumor trial in relapsed renal cell cancer, but are prioritizing initiation of the PTCL and atopic dermatitis trials. Our plans to move into a clinical trial are supported by our preclinical work and independent academic confirmation led by a team from Erasmus University in Rotterdam. The trial was planned to be conducted in partnership with investigators at the Kidney Cancer Research Consortium. The clinical and preclinical results we have seen with Keystone Symposia on systemic autoimmune and auto inflammatory diseases that included the first description of our next generation ITK inhibitors, which are designed to deliver precise T cell modulation that is optimized for specific immunology indications.

Speaker 3

Given the broad potential of ITK inhibition in inflammatory mediated diseases, we seek to partner with biotech or pharma companies that have established development and commercialization capabilities that match with the various opportunities. In order to accelerate our business development activities, in February, we appointed Jeff Arquera as Chief Business Officer. He joins Corvus with more than 30 years of commercial experience in the biopharmaceutical industry, including broad functional experience across commercial development, corporate development, product licensing and partnering and corporate strategy. I will now pass the call to Jeff to comment on our business development initiatives. Jeff?

Speaker 4

Thank you, Richard, and good afternoon, everyone. I am very excited to join the Corvus team and to advance the development of a very promising pipeline. In cancer, Corvus is focusing in areas of high unmet need with a novel target and with significant commercial potential. The opportunity to join Corbus at this time was very appealing with a number of potential milestones and key inflection points for the company over the next 6 to 12 months, including the start of our Phase 3 trial solvolitinib for relapsed PTCL, which is addressing an indication with significant unmet need and provides the opportunity to bring an important new treatment option to patients and to create value for Corbus. From the commercial perspective, if approved, it will be the only fully FDA approved treatment for relapsed PTCL.

Speaker 4

To give a sense for the magnitude of the opportunity, consider these factors. PTCL has a very high unmet need with a very low survival rate of under 20% at 5 years. So there is a desperate need for new and effective therapies. It is estimated that there are 70,000 cases of PTCL globally with current pricing for treatments in the U. S.

Speaker 4

Ranging from $200,000 up to $600,000 per year. Soquelitinib represents a near term commercial opportunity with our planned Phase 3 trial protocol intended to enroll 150 patients. The market for drugs to treat hematologic malignancies is large at approximately $55,000,000,000 and is projected to grow to $90,000,000,000 by 2028. For purposes of benchmarking, global sales of ADCETRIS and anti CD30 drug conjugate were $1,600,000,000 in 2023 with estimated sales of approximately $558,000,000 in patients with non Hodgkin's lymphomas, primarily in patients with anaplastic T cell lymphoma, a subset of PTCL accounting for about 15% to 20% of cases. Together these factors make the PTCL opportunity substantial for a novel effective treatment as is seen with other disease modifying therapies in the hematology space.

Speaker 4

More broadly, we view PTCL as an entry point with numerous potential ways to expand the opportunity and help more patients with solid tumors and immune diseases. Given all this, we believe sopolitinib and our next generation ITT inhibitors can be an attractive opportunity for partners, given the unique mechanism of action, human safety data with Sokolitinib from our Phase 1 lymphoma trial, the large and diverse market opportunities in oncology and immunology and our strong intellectual property position with issued composition of matter patents for Sokolitinib extending out to November 2,037, not including likely extensions. With that, our preferred partnering strategy is to find partners with development and commercialization expertise in immune disease as well as to seek regional partnerships in oncology. We have seen increasing momentum in partnering interest since the announcement of our Phase 3 registration trial in the Q3 of 2023 and recent publications on the activity of sotolitinib in preclinical models of cancer and immune diseases. I will now turn the call back to Richard.

Speaker 3

Thank you, Jeff. Turning to our partner led programs, the Kidney Cancer Research Consortium is currently enrolling patients in a Phase 2 portion of the Phase 1btwo clinical trial evaluating ciforadenant, our adenosine A2A receptor inhibitor as a potential first line therapy for metastatic renal cell in combination with ipilimumab and nivolumab. The clinical trial is expected to enroll up to 60 patients and there are currently about 25 patients enrolled. Based on current timelines, we anticipate initial interim data in the first half of twenty twenty four. Encouragingly, as we enroll more patients, we continue to see that the deep response rate exceeds our 32% benchmark based on 14 evaluable patients that have received at least one follow-up assessment, up from 8 evaluable patients at our Q3 call.

Speaker 3

Recall, deep response rate is complete response plus partial responses that exceed 50% tumor volume reduction. This endpoint has been shown by others to predict prolonged progression free survival and it is 32% with ipilimumab and nivolumab. For our anti CD73 antibody, mupidolumab, our partner Angel Pharmaceuticals is continuing to enroll patients in a Phase 1, 1b clinical trial in China with mupidolumab alone and together with pembrolizumab in patients with non small cell lung cancer and head and neck squamous cell cancers. Summarizing the outlook for 2024, our current cash allows us to achieve near term milestones, including starting our registrational Phase 3 clinical trial of socolitinib in PTCL, generating interim data from early cohorts of the socolitinib Phase 1 atopic dermatitis clinical trial and reporting interim data with ciforadenant in renal cell cancer in the first half of twenty twenty four. Our intent is to leverage these near term milestones and achievements as we seek additional funding and partnerships for our ITK inhibitors in immunology and oncology as well as our other novel programs, including the A2A receptor antagonist, ciforadenant.

Speaker 3

We look forward to providing updates on our programs in the coming quarters. I will now turn the call over to the operator for a question and answer period.

Operator

Thank you.

Speaker 3

Operator?

Operator

Thank you. We'll now conduct our question and answer session. And our first question comes from Gregg Svanovich with Mizuho Securities. Please state your question.

Speaker 5

Hi, this is Jerry on for Gregg. Just taking our questions. Maybe 2 from us. To start off with on the Phase 3 trial initiation, can you kind of speak to what's kind of gating the start of that trial? And have there been any adjustments to the protocol since?

Speaker 5

And I do have a follow-up.

Speaker 3

There's been no changes or adjustments to the protocol. We've been in complete agreement with FDA on the design, statistics and other parameters of the trial. Nothing's changed in that regard. Our Phase 1 data continues to improve as we have longer follow-up. We're in the process now of finalizing contracts with the various centers and there's really no gating items other than the usual administrative things.

Speaker 3

Got

Speaker 5

you. That's super helpful. And then a question for you, Jeff. You did speak to a range of pricing in PTCO. Can you kind of speak a little more on to, I guess, how Corbus is thinking about where you fall in that range or that range of a scale pricing?

Speaker 4

Yes. Thanks. I guess in terms of pricing, we look at analogs and what the current market is charging in terms of these areas. I think you take into account the size of the patient population that you're going after. But more importantly, the pricing is really going to be dictated on the size of the unmet medical need, which we know is very large in PTCL, as well as the product profile that we present, so the safety and efficacy data that we have.

Speaker 4

So I think, obviously, we're looking at analogs at this point time, but ultimately the final price will be set once we get the final data and do some testing with payers on the value proposition.

Speaker 5

Got it. Thanks for taking our questions and congrats on the quarter.

Operator

Thank you. Our next question comes from Jeff Jones with Oppenheimer. Please state your question.

Speaker 6

Hi, guys, and thanks for taking the question. I guess, 2 for me. Can you speak to the confirmed versus unconfirmed reported outcomes in the PTCL study with the additional CR now and just to clarify how many of those are confirmed versus unconfirmed? And then what They're

Speaker 3

all confirmed. They're all confirmed.

Speaker 6

Okay. Thank you. Yes.

Speaker 3

And Jeff, I might also add that usually in relapsed disease, we don't most clinicians don't really talk about confirmed and unconfirmed. That's more appropriate in frontline therapy. In relapsed disease, especially in this disease, people live such a short time that in half your cases, it's a difficult to even get people beyond a few months. So, but all of our responses are confirmed, partially.

Speaker 6

Okay. The swimmer plot, you're showing, it looks like there are some patients who are still quite early in treatment. And so it almost looks like you're still enrolling patients in that study. So I guess, are you still enrolling patients in that Phase 1 study? And would you be able to perhaps roll those patients over to the Phase 3?

Speaker 3

We are not enrolling new patients in the Phase 1 study. The patients that are shown on the swimmers and waterfalls and some of them are continuing on therapy will be followed of course and continued on therapy until they progress. But there's no new patients being enrolled in the Phase 1. We're focusing our centers now, many of the centers who participate in the Phase 1 are participating in the Phase 3. So we've got those guys now focused on the Phase 3 trial.

Speaker 6

Okay, thanks. I'll jump back into the queue.

Operator

Our next question comes from Roger Song with Jefferies. Please state your question.

Speaker 7

Hi, this is Liang Chang on for Roger. So thank you for taking our questions. I think two questions from us. I think first one on zuclolitinib, the updated Phase I data. So for the 5 patients with tumor reductions that did not meet the criteria of PR, so how long were the continue, how long have they been on the treatment?

Speaker 7

Then I have a follow-up. Thank you.

Speaker 3

For the all right. For those that didn't that are the first question had to do with for those who have not reached the criteria for PR, how many are still how long are they still on treatment? So if you look at the swimmer, that would be one is, which by the way you can do yourself is 5 months. 1 is about 6 months, another one is 7 or 8 months. Okay.

Speaker 3

And the other ones have been PRs. So that's my quick look at the swimmer. And the second part of your question was what?

Speaker 7

So for the acute that it continues on the treatment. So yes, I guess

Speaker 3

They continue on the treatment. Patients continue on treatment until they progress or they have some sort of a safety issue, but that's not happened.

Speaker 7

Sure. Okay. So maybe moving on. Yes, yes. I think my second question is about the Phase 1 study in atopic dermatitis.

Speaker 7

So the patients are required to spell at least one prior. So any specific requirements on that?

Speaker 3

I didn't quite hear the end of your patients are required to have failed one prior topical or systemic therapy. They're required to have moderate to severe atopic dermatitis. They're requiring to be to have failing their prior therapy. Does that answer your question?

Speaker 7

Yes. Okay. Thank you. That's all for now.

Speaker 3

Thank you for the question.

Operator

Our next question comes from Lee Watsack with Cantor Fitzgerald. Please state your question.

Speaker 8

Hi there. This is Rosemarie on for Lee. Thanks so much for taking Maybe firstly, could you reiterate the benchmarks for the relapsedrefractory PTCL, what you're hoping to see? There's some interference on the call earlier, so I didn't catch that. And then I do have a follow-up question.

Speaker 3

So palatrexate and belinostat are currently the standard agents for relapsed peripheral T cell lymphoma. Those agents received accelerated approval currently fully FDA approved drug for relapsed PTCL. Pralotrexate and belinostat are basically chemotherapy drugs. Belinostat is an HDAC inhibitor, palotrexate is a folate antagonist. Both of those drugs suffer from the usual chemotherapy toxicities, which are neutropenia, thrombocytopenia, anemia.

Speaker 3

Prolitrexate suffers from an additional toxicity mucositis. The response those patients the approval of those drugs was based on single arm Phase 2 studies that enrolled somewhere between 100 120 patients. The response rate was about 25%. The PFS, progression free survival was in the case of belinostat, I believe it was 1.6 months. And in the case of pralotrexate, it was around 3 months, if my memory is correct.

Speaker 3

We have a slide about this up on slide presentation on our website. So we see 33% response 33.3% response rate with more than half being CRs. CR rate in ours is about double of the 25% or so response rate with palatricine and belinostat about 10% with CRs. In our responders, most of the responders are CRs, albeit a small number. So CRs are very important in hematology and especially in the lymphoma world.

Speaker 3

The progression free survival in our hands is 6.2 months, which is substantially better than the 1 point and 3.0 months I mentioned earlier. So we hit our study of just to go on because I think I know we are hit. Our study design, the statistical design is to enroll 150 patients, 75 in each arm standard of care versus socolitinib 75 in each arm as I mentioned. The power, we have about 89%, 90% power to see an improvement from about 3.5 months to 5.5 months, which is our target. Okay.

Speaker 8

Thank you so much. Yes, thanks for the really thorough answer. And then I just have a quick question on atopic dermatitis. So for the data that we may get later this year, do you have any anticipation around like the nature of that data, like how many patients, how many doses or is it just too early to tell? Thanks.

Speaker 3

No, no. We have very good estimation of that. Okay. So first of all, we know a lot about the dosing of this drug already since we've been evaluating it in patients with lymphoma. We know a lot about the pharmacokinetics, the occupancy of the target, the safety, etcetera.

Speaker 3

So we're going to be studying 4 cohorts of patients that are enrolled sequentially. So we start with, let's say, the low dose cohort, which in our case is 100 milligrams BID. 200 milligrams BID is our dose in the lymphoma studies and in the proposed Phase 3. So 100 milligrams BID enroll 16 patients in a 3:one randomization where 12 will get socolitinib and the other 4 get placebo. Then we go to the next dose regimen, which is 200 milligrams once a day, because we think that once a day dosing will be effective and we think it's more convenient of course.

Speaker 3

So same thing, 16 patients go in there. Again, 3:one randomization, 12 get vosocolitinib, 4 get the placebo. And then we go to the end of the 3rd cohort where that which is 200 milligrams twice a day, the same regimen that we're using in lymphoma. Same idea, 12 patients get the drug, 4 get the placebo, again randomized. And then the final cohort would be 400 milligrams once a day.

Speaker 3

Now the reason that we're studying those cohorts is that we know that at 200 milligrams you get complete occupancy of the receptor. 100 gives you pretty good 100 gives you pretty good occupancy, but not it's not complete, but probably good enough to cause some biologic effect. So I would not be surprised if we see some effect at the even at the lowest dose regimen. So as I mentioned earlier, the doctor and the patient are blinded. The company is not.

Speaker 3

So we can look at the data and we have a data monitoring board that can look at the data after each cohorts enrolled. And we're able to report that data or not. I mean, I don't anticipate we're going to be reporting it every week. But at our discretion, we can be reporting that data. Now there's also a very rich amount of biomarker data that's going to be accumulating during the study.

Speaker 3

We're measuring a number of different cytokines and lymphocyte subsets, etcetera, etcetera. And we know already from our lymphoma studies and our other animal studies that we've done and published, we know what biomarkers, what cytokines are affected like IL-four and IL-five and others. So what we would be looking for at each cohort of course is safety. We would be looking at changes in biomarkers in our treatment group relative to baseline. We would expect to see changes in IL-four and IL-five and IL-three and all these things as comparing each patient to his or her baseline.

Speaker 3

And of course, we'll be doctors will be assessing the efficacy based on the grading criteria as I mentioned earlier, the EASI score and the investigator global assessment. So we're going to learn a lot from each of these. Now, in terms of the dosing, we as I mentioned, we know a lot about the dosing already. So we're able to start at 100 milligrams BID. I would expect to see something very early in this study.

Speaker 3

And I think we'll get an idea very early, not only about the efficacy, but also about the biologic activity. Because remember, the reason that we're picking atopic dermatitis first is that it is very much what's called a Th2, T helper cell 2 disease, a disease mediated by IL-four and 5 and 13. And we know that our drug blocks the Th2 function very well. We learned this from our lymphoma studies and from our other studies, preclinical studies. So we're going to be able to determine very early in the study about safety.

Speaker 3

We already know that from our lymphoma studies. We'll be able to determine whether or not we're having the immunologic effects that we expect. And of course, we'll be monitoring the clinical efficacy. Now the immunologic effects are important because this becomes the entry point, the stepping stone to other immune diseases. What are the other immune diseases?

Speaker 3

Asthma is one that would be very much Th2, psoriasis, scleroderma, several other diseases. We have a whole list of them on our website presentation. So this is a very important study in that we get data quickly and it's very informative not only for the purpose of atopic dermatitis, but it opens up the whole field. Basically this study puts ITK inhibition on the map as an important therapeutic modality for a host of immune diseases. It's very reminiscent of an antibody that I worked on called rituxan.

Speaker 3

And where we what we learned in lymphoma taught us about what happens to B cells etcetera. And that opened the door for a lot of other dermatologic and immunologic diseases. So that was a long way to answer your question, but I wanted to make sure that we really had proper perspective. I appreciate the question. Did I forgive you?

Speaker 5

Great. Thank you so much.

Operator

Thank you. And there are no further questions at this time. I'll turn the floor back to Richard Miller for closing remarks.

Speaker 3

Thank you, operator. Well, I want to thank everyone for participating in the call today. We look forward to giving additional updates each quarter and advancing socolitinib and other products in the coming months. Thank you very much.

Operator

Thank you. This concludes today's call. All parties you may disconnect. Have a good day.

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Key Takeaways

  • Corvus plans to initiate a registrational Phase 3 trial of socolitinib in relapsed peripheral T-cell lymphoma in Q3 2024, with FDA alignment on protocol and orphan drug designation supporting enrollment across ~40 U.S. and Canadian centers.
  • A randomized, placebo-controlled Phase 1 trial of socolitinib in moderate-to-severe atopic dermatitis will start in April 2024, enrolling 64 patients in four sequential cohorts to assess safety, tolerability and EASI improvements, with initial data expected before year-end.
  • Partner-led programs include ciforadenant (A2A receptor antagonist) in a Phase 1b/2 trial for metastatic renal cell carcinoma, with interim deep response data (>32% benchmark) anticipated in H1 2024, and ongoing Phase 1/1b enrollment of mupidolumab in China for NSCLC and HNSCC.
  • Financially, Corvus ended 2023 with $27.1 million in cash, cash equivalents and marketable securities, reduced R&D spend to $16.5 million (from $24.5 million in 2022) and narrowed its full-year net loss to $27 million (from $41.3 million in 2022).
  • To accelerate business development, Corvus appointed Jeff Arquera as Chief Business Officer, targeting partnerships for its ITK inhibitors across oncology and immunology and leveraging issued patents through 2037.
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Earnings Conference Call
Corvus Pharmaceuticals Q4 2023
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