Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)  

GTX, Inc. (NASDAQ:GTXI)

Lazard Capital Markets 9th Annual Healthcare Conference

November 13, 2012 10:00 AM ET

Executives

Mitch Steiner – CEO

Analysts

Ryan Martin – Lazard Capital Markets

Ryan Martin – Lazard Capital Markets

I am Ryan Martin, Biotech Analyst here at Lazard. Next presenting company is GTx, Inc., and to give you an update on the company, we have with us here, the CEO, Dr. Mitch Steiner.

Mitch Steiner

That was efficient. I appreciate it. Good morning and thank you for being here. It’s my pleasure to tell you a bit about GTx, and give you an update where we are. Before I get started, we will be making some forward-looking remarks and for that, I ask you to look at our filings with the SEC, particularly the 10-Q filed in August 8, 2012.

So GTx has, in addition to a deep pipeline, our biggest focus this year has been on our two late stage programs. One is enobosarm, which is a first-in-class molecule. This is a molecule that builds muscle, builds bone, leaves the skin alone, leaves the prostate alone, can be given to women, can be given to men. This has been in eight clinical trials involving over 600 patients. It’s a small molecule, it’s a not a steroid, and currently it’s in two Phase III clinical trials that will support the indication of prevention and treatment of muscle wasting and patients with non-small cell lung cancer.

And we just recently announced that the DSMB has reviewed the safety data and that the safety data is fine and that we are able to proceed. The second late stage program is Capesaris. Capesaris is a ER alpha selective agent. It is the next class if you will, of novel drugs for castrate-resistant prostate cancer. It’s not a me-too, it’s completely separate class. And it’s a hormonal treatment. This is also been in eight clinical trials involving 500 subjects and we’re currently in a Phase II or fifth Phase II doing dose – additional dose finding work in metastatic castrate-resistant prostate cancer.

So let me focus on enobosarm. So again, as I mentioned in my opening comments, enobosarm has been in multiple trials. The drug whether it’s in cancer patients, whether you give the drug to healthy volunteers, post-menopausal women, elderly men, it does what it’s supposed to do and that is a muscle drug. And it works with the androgen receptor. It binds with that receptor, it builds muscle, it builds bone. And the data here shows you three separate Phase III – excuse me, three separate clinical trials, the top one is a Phase IIb that was done, (inaudible) so if I wanted to point, I couldn’t, so you’re going to have to – so Phase IIb cancer cachexia trial. This is a study in which we measured the same exact endpoints as in the trials, the Phase III which is the lean body mass which is muscle, physical function, which is stair climb tests where we ask patients to climb up steps, we measured the power.

And two of our – in two of our efficacy trials, essentially whether you’re a cancer patient or an elderly patient, post-menopausal patient, that’s the Phase II proof-of-concept study right below the cancer patient trial. We increased lean body mass by 1.5 kilograms and we increased physical functions in some cases as high as 27%. Now to put them in perspective what that means is that a cancer patient undergoing chemo or just finishing chemo had an increased 1.5 kilograms, that’s 52 ounces of muscle, not weight, muscle.

And they did that in four months, and for the healthy it’s three months and so that’s like a 52 ounce stake that they were able to grow in that period of time. That’s very important.

Now the question is, is that stake, quality stake? And the answer is yes, because a 10% increase in stair climb power is considered substantially clinically meaningful. So if a patient is able to go up to steps with 10% more power, a good way to think of that is they could go up to steps with an additional four bags of groceries. So if you’re a 20% you can see what that means. And we did this last – the Phase Ib sarcopenia trial with Merck and in this study, we used leg press, so imagine now you have 88 post-menopause women over three months being treated with placebo or a drug, at the end of three months, the women on our drug had an increase of lean body mass, again 1.4 kilograms whereas the placebo patients had nothing.

And then when you asked the question, leg press, and this is probably easier for us to conceptualize, all you’re asking to do is press with their lives and you measure how much you’re able to push. The placebo patients no change, again no prescribed diet, no exercise program had no change, but yet the women that took the drug, as all they did was take the drug had the ability to increase their leg press by 25 pounds.

So this is a strength drug, no question about it. And we’re trying to figure out how do you take a strength drug and develop it into a commercial opportunity and this commercial opportunity we believe is the road to all the other muscle wasting diseases and that is go after muscle wasting which is important cancer related symptom in non-small cell lung cancer. And so it turns out half the patients are non-small cell lung cancer present with muscle wasting, 88% will have functional impairment including not being able to lift and carry 10 pounds, walk, stoop, crouch, kneel, anything that has to do with the upper leg muscles which are very, very androgen sensitive if you and including going up steps.

And performance status is the number one predictor how well a patient is going to do. So if a patient looks good, they get more chemo. If the patient doesn’t look good, they don’t get chemo, they go home to die. So we do believe that we can play an important role. Now this particular slide is an ad hoc slide looking at the data, only in non-small cell lung cancer patients. These are the patients that are currently in our Phase III trials, so this is a Phase II that preceded that.

And what you can see is lean body mass increased by 1.1 kilograms in the cancer patients on our drug and the cancer patients not on our drug actually had a loss of one kilogram lean body mass. And so that's a delta of almost two kilograms. And then again for physical function, there was an increase in the physical function by 17.6% and again 10% is considered clinically meaningful whereas the placebo patients just went down, okay? So this is serious disease and it was that Phase IIb that we were able to go to the FDA and negotiate the trials that we have now with a first-in-class compound with a new indication.

So what are goals for treatment of advanced stage non-small cell lung cancer? Well we’re kind of have the same goals that chemotherapy has. If I can impress upon anything to you today, is don’t think of this as a appetite drug or a cancer wasting drug from a standpoint of end of life. We really see ourselves as being part of the fight, because when you give a patient with non-small cell lung cancer chemotherapy, what you’re really trying to do is you can't cure them. Is can you improve cancer related symptoms.

Well with enobosarm we know, we can improve lean body mass or muscle wasting which is a cancer related symptom too. Can you improve quality of life? Well with enobosarm we know we can improve physical function. Can you prolong survival? That’s the big question mark. We believe that if you treat the host, not just the cancer, that you can potentially improve survival. We don’t know that but that’s what we’re going to test. We did see a 27% fewer deaths in our Phase IIb, but again those are small numbers and you just have to look at big trials.

So what are we able to do is negotiate with FDA. This is the Phase III trial, it is going on now, the international trials, 300 patients per trial POWER 1 and POWER 2 are the names of the trial. They are identical. The only difference between the two trials is the chemotherapy that patient is getting. Our position is it going to be part of the fight then you have to start the drug at the time the patient starts first line chemotherapy. So in POWER 1, that’s a Platinum plus a Taxane and in POWER 2, it’s a Platinum with a non-Taxane.

And the goal is to treat the patients with three milligrams of enobosarm or placebo and after they finish four cycles which is typically first line chemotherapy, then we look at lean body mass and physical function as a co-primary endpoint. For the patients that respond, we check them again at five months, two months later and all the care at that point is what’s the durability of response. The primary endpoint is in fact the clinical benefit is the co-primary end point which is maintaining lean body mass and if you get that, you’re yes, and the second thing is a 10% increase in physical function which is measured in power and if you get that, that’s a yes, okay?

So that’s important from a standpoint of responders’ analysis. There was no missing data. You’re either a yes or you’re no. And what you wanted to show is you have more responders with our drug than with placebo. Now this is an important point, why? Because a lot of questions that we get is what’s the clinical benefit here? What’s the FDA going to see is clinical benefit? We defined clinical benefit before we started the trial. So the definition of the clinical benefit is you maintain your lean body mass and you have an improvement in physical function and if you do that, you’re a responder and by definition you’re responder, you have met the regulatory requirement for clinical benefit. That’s an important point. So we’re not going to have to have that discussion after the trial data comes in, of what the definition of clinical benefit, what the FDA would accept is clinical benefit.

Now to put that in perspective, we saw in our Phase IIb as an ad hoc because we’re looking at the data differently as a responders analysis, we saw in physical function that the placebo patients had a 33% improvement in physical function with chemo and lean body mass 33% were able to maintain. That’s the best chemo can do. Whereas enobosarm was at 70% for physical function and lean body mass was 63%. So another way of looking at it, is that 70% of the patients were decline in muscle mass and 70% of the patients who have a physical function declined, whereas in enobosarm it was the opposite almost.

And when you think of it from a commercial standpoint, yes, we can hit on physical function and we can hit on lean body mass that will be important, why? Well what we now know and unfortunately we’re humbled over the last five years, over 20,000 patients have participated in 17 Phase III programs for non-small cell lung cancer using cytotoxic chemotherapies and they did not have the survival benefit.

So the question is if they’re not going to have a survival benefit, let's take that end of it and you’re only going to live eight to 12 months after you’re diagnosed with stage-3, stage-4 on average non-small cell lung cancer. Can you spend more of that time at home with independence, less of a burden to your family, doing the things you want to do every day and delay hospice and delay specialized nursing care which is somebody is paying for and make their time better? What we’re hearing from the KOLs that’s exactly what they want to see.

Never we had any discussion if this is a Megace or Marinol or an end of life drug, but we’re hearing if we can be part of the fight by coupling it with first line chemotherapy we can achieve that. So just from a standpoint, if you can get back, as we go to next slide – just from a standpoint of timing, we announced that we believe that this quarter we’re going to complete enrollment of both studies. As you know, last patient out meaning five months later we will be able to look at the data, so we’re expecting to see top line data in early June of – late second quarters of June of 2013. And our expectation is that we will be able to report top line data and after we report the top line data, move very swiftly to file the NDA assuming it’s positive.

Now lung cancer is a huge market. An indication would be prevention and treatment of muscle wasting. So it’s a new indication. It’s probably one of the most common cancer related symptoms that a lung cancer patient will develop. It is a most fearful one because fatigue, loss of independence, weakness, inability to take care of yourself is a scary thing for patient. Loss of appetite, they don’t know they’re missing it. They are more worried about the fatigue.

And in the U.S., we can now from a commercial standpoint see there is a 170,000 patients, because we know we’re starting first line chemo. And a $30 to $50 a day which is the low end of what our experts are telling us from a market independent research, this is a big opportunity. Our thinking is if we’re successful here, then the blue ocean for us is to go after other muscle wasting diseases. So end-stage renal disease muscle wasting, COPD muscle wasting, cardiac cachexia, rehab medicine, before and after hip or knee replacement, burn patients. These are all diseases where muscle wasting is a problem in which a muscle drug could be a solution.

Just for the purposes of time, let me move on to say that intellectual property is strong. 79 patents in composition of matter patent. First one going out to 24 and with the five year extension for a new chemical entity 2029 and there was about 350 patents around this technology with 79 specific for enobosarm. So we’re very excited about this opportunity and we do see this as a springboard if you will, running to all of cancer types in wasting but also into other muscle wasting diseases. There are no drugs out on the marketplace now to address these unmet medical needs and enobosarm so far has shown at least in the Phase IIb the efficacy and the safety that would be useful for these other indications, acute or chronic.

Now let's turn our attention to Capesaris. So Capesaris is our prostate cancer drug. It’s a drug that has the ability to go into more than just castration-resistant prostate cancer. Most of the buzz over the past couple of years have been around drugs like Xtandi from Medivation and abiraterone prednisone from J&J, formerly Cougar had the drug initially and these drugs have shown us that there is no question that this is a very important space and that what we’ve learned is that chemotherapy is going to be pushed further and further away. This is going to be a similar to prostate cancer, I mean in breast cancer wherein breast cancer, women will go through several different kinds of hormonal therapy and you push chemo off, because non-selective cytotoxic chemotherapy is not where you want to be, you want to be with the selective targeted.

So in prostate cancer, it’s the same thing. And what we’re learning now is that with p prednisone plus abiraterone, it has a certain profile that may put it in a different location in the treatment and the Medivation AR blocker has yet another and where GTx comes in with Capesaris is it’s still yet another completely different mechanism. So when you do hormonal treatments, it makes sense to pick different mechanisms that you treat [ph]. So Capesaris, we believe can play a role in two places. One, it can play a role in treating patients who just developed castrate-resistant prostate cancer, it means they failed Lupron or drugs like that and the second place it could be is actually in combination with drugs like Lupron because what we’re learning now is that the number one reason why these patients are progressing is because an incomplete or ineffective castration.

And that’s why all these drugs are continuing to work on the androgen receptor access work is because we have complete castration then why are they still being modulated with things that block androgen receptor and how does Capesaris work? Capesaris has three mechanisms and I am going to focus on one but one is it does cause feedback in the patient and lowers LH just like Lupron does. Two, it causes the liver make a protein called sex hormone-binding globulin which think of it as a sponge that goes around and grabs any free testosterone, unbound testosterone it sees and holds onto it for all practical purposes, it cannot be released and it cannot be available for prostate cancer cells.

Three, because of the class of drugs, it has the ability to interfere with the tumor itself and decrease into (inaudible) and finally it should have effects on the adrenal. We know for a fact one and two, we have evidence with three and we have nothing yet for four but we’re measuring that in our clinical trials. But giving this class of drugs, it should work. Now we have done several studies. We’ve done four Phase IIs and the Phase IIs we’re trying to move into position of can destroy primarily castrate and secondly can it be used in patients that have failed Lupron.

So it’s really two areas, the reason I like going after the combination therapy and first line is 750,000 patients and then there is a 100,000 patients who failed Lupron. So this is a big end of the commercial market. It’s not in the post-chemo space where you still dealing with 5,000 to 15,000 patients. So what did we learn? What we learned and we learned a lot and there is a lot of publications coming out of AUA and in GU ASCO, and basically what we’ve learned is we can castrate, we do increased SHBG and lower T. We primarily lower not only total testosterone but we lower pre-testosterone which is the action end if you will because the unbound stuff that gets in this, not the stuff that’s bound and we also learned in our Phase IIs that we can maintain castration as a single agent and that we do that again by increasing SGBG and free T but interestingly because it’s an estrogen, when a man is castrated their testosterone levels go way, way done.

And the only place we get estrogen is in testosterone. So when testosterone is castrate, you’re an estrogen castrate. And that’s why men on Lupron and drugs of that sort have hot flashes, they lose bone, develop metabolic syndrome, if you can add estrogen back, that would be back. So we’re doing think about this, we’re lowering testosterone even further, then Lupron and other ABG [ph] can but because we’re an estrogen we’re replacing it. And so patients don’t get the hot flashes, patients don’t get the bone loss and we’re going to wish presenting all those data at the meetings coming up this spring.

Now the one issue that we did have was an increase in VTEs and VTEs, venous thromboembolic events is a well known side-effect of estrogen therapy like an hormonal replacement therapy in oral contraceptives and the rate was higher than we’d like. And but still very much lower than DES which was the drug that was used for 60 years before Lupron showed up in prostate cancer. And we are doing some things now in our Phase II to decrease that risk, get the risk down to what’s expected already with Lupron with Lupron is about 4% per year and this is just data from our Phase II where we treated patients who failed Lupron and at the time we terminated this trial because the doses were too high.

Every patient was responding with a PSA response and these are patients that were on Lupron before and then our drug was added. So the Phase II that’s going on and we did – we called the FDA, told them we wanted to lower the dose, we put on clinical hold until we gave them a new protocol, gave them a new protocol and then they took a self-clinical home for 30 days. And the trial that we have going on now is a trial that really dramatically lowers the dose. The dose is a 125 which is 10 times lower than the lowest dose we tested before, 250 and 500 milligrams a day. So these are oral drug.

And the endpoint is again a PSA response which is now time tested, so we’ve been time tested with Medivation drug, as well as the Cougar [ph] drug that if you can lower PSA by greater than 50% then that’s going to end out with a clinical benefit. And these patients have metastatic castrate-resistant prostate cancer. So they’re going to look very much like this slide I just showed you in which every patient responded by reduction in PSA and the mechanism is again increasing SHBG, lowering the unbound free T, squeezing their testosterone out of the micro environment.

Now one of the push backs we got is do we believe that going to lower doses, are we going to have efficacy? People feel more comfortable that by lowering the doses and doing the things that we’re doing to protect the patient, their VTE rates should be close to what Lupron has but when we see the efficacy. Well we now know is if you’re in a range of about 300% increase in SHBG, you should have seen the efficacy. And in each one of these doses we’re certainly in that range.

We created a steering committee of the same exact individuals that helps chaperone [ph] abiraterone prednisone to the finish line and the Medivation drug, Xtandi to finish line, our thinking was if we can get the same exact people and they believe that this is another drug with a different mechanism that could play a role, an armamentarium of a hormonal therapies, prostate cancer that would be great. So these names you will recognize as being important names and they are very, very excited about our drug. And where we stand right now is the Phase II started already and we hope to have data by summer for all three cohorts.

And at that point, we’ll be able to pick a dose. And once you pick a dose it will be the same because the liver doesn’t care whether you have prostate cancer or not, so the thinking is bring SHBG down, you bring free T down and then you can go into secondary hormone therapy as your first secondary hormone therapy that will lower PSA, effect PFS and do that without estrogen deficiency side effects and then in first line, what you would do is basically a combination therapy with Lupron and which you lower testosterone even lower than Lupron can without the estrogen deficiency side effects.

We’ve got 20 composition of matter patents, last one to expire – first one to expire is January 2029 and then you get five years after that for new chemical entity. We are doing very well from a financial standpoint. We just announced that we have $55.9 million (inaudible) so it’s $46 million I think is what we announced plus the $19 million that we just sold to FARESTON which is a breast cancer drug that was – it was a non-strategic asset for us.

So with the $19 million plus the $46 million, it puts us well in position to see our money last to mid 2014 which is well beyond almost a year beyond the Phase III that we would see for enobosarm and we will see all of our data for the Phase II for Capesaris so we could then talk about which Phase IIIs we’re going into. We have no debt and we have no warrants. So we got a deep pipeline and I want to leave some time for questions which is a minute and 52 seconds and we can go from there. Any questions?

Question-and-Answer Session

Ryan Martin – Lazard Capital Markets

Maybe Mitch, just to start out with, you’ve define obviously what a clinical benefit is at three months. What about the durability and point at five months in oral survival just more in terms of what peers may like to see or maybe even the FDA for that?

Mitch Steiner

So in terms of durability that really is a secondary endpoint that is descriptive in nature and not statistical. So think of that as sort of a – I mean that’s why we’re kind of just watching it and it’s not going to play a big role. Overall survival could, the payers that we talk with as well as the physicians say well if cytotoxic chemotherapy can prolong survival then why you’re going to ask a drug that’s non-cytotoxic to do that. However they do believe if we treat the host, the patient and if the patient looks better, they may get more chemo. If they get more chemo that may translate to some other benefits and so we just have to see and the trial is certainly large enough for us to be able to see that.

FDA does not require a statistical analysis of overall survival. What they’re interested in overall survival is to make sure our drug is safe and that the overall survival isn’t different between the arms. But we have – we do believe we’ll see something in the order for 400 plus deaths at the time we file our safety update four months, 120 days after you file your NDA and at that point, we would have the power statistically if we’re successful, i.e., we do have an effect on survival to be able to capture that.

We certainly will announce whatever survival data we have at the time we announce top line data, recognizing that you’ll get more deaths as you move along. But the payers are not asking for that. The payers are perfectly happy to see themselves save money by the patient not being in hospice and skilled nursing care, if you’re able to delay that even by a month or two months or three months, somebody is saving money, and not to mention the quality of life aspects of the patients.

Ryan Martin – Lazard Capital Markets

Maybe one final one just on the $750 million market opportunity you mentioned in the U.S., just curious what the assumptions maybe on patient numbers in terms of pricing etcetera, what kind of…

Mitch Steiner

For Capesaris?

Ryan Martin – Lazard Capital Markets

No, I think you mentioned on enobosarm.

Mitch Steiner

Enobosarm.

Ryan Martin – Lazard Capital Markets

Yes, can you give us…

Mitch Steiner

Yes, so in enobosarm we did mentioned in the slide with a price between $30 and $50 a day, you could easily hit $750 million that’s in non-small lung cancer alone in U.S., okay. And so if we go into other cancer types, other muscle wasting diseases worldwide it’s I mean this is significant product. And because it’s a first-in-class, most of the time with a first-in-class and a first indication, it will go into NCCN guidelines which is you know that’s what payers look at to make a decision about whether to pay for some – it’s not a me-too and it’s not to be confused with Megace and Marinol which are appetite drugs. This is a strength drug.

Ryan Martin – Lazard Capital Markets

Again, just to follow on that, so you may even look to see (inaudible)?

Mitch Steiner

Yes. Well we have goal yes.

Ryan Martin – Lazard Capital Markets

Thanks, great.

Mitch Steiner

Thank you.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: GTX's CEO Presents at Lazard Capital Markets 9th Annual Healthcare Conference (Transcript)

Check out Seeking Alpha’s new Earnings Center »

This Transcript
All Transcripts