ZIOPHARM Oncology's CEO Presents at Barclays Global Healthcare Conference (Transcript)

| About: ZIOPHARM Oncology, (ZIOP)

Ziopharm Oncology Inc (NASDAQ:ZIOP)

March 13, 2013 4:15 pm ET


Jonathan J. Lewis - Chief Executive Officer and Director

Unknown Analyst

Good afternoon, everyone. My name is [indiscernible], I'm the U.S. biotech analyst here at Barclays. So our next presenting company is ZIOPHARM Oncology. And I'm very pleased to have Jon Lewis, CEO of the company. With that, I'll just pass on the podium to Jon.

Jonathan J. Lewis

Thank you very much. Good afternoon, and thank you to Barclays for including us. As is well known, we are a cancer drug development company. I'm going to be making forward-looking statements, for that I refer you to our website. We are very much focused on connecting science, through regulatory pathways, into high unmet need. There are 2 key elements in terms of the way we're going about this now. One, is small molecules, the other is synthetic biology. I'm going to get into some details regarding these approaches. And underlying some of the diversity of the portfolio, upcoming milestones and how we are approaching them moving through and on.

Shown here is the portfolio. We are very much data-driven, very much science-driven. At the top is palifosfamide with the various programs. The next is Ad-RTS-IL-12, part of the synthetic biology program. I'm going to get into more detail now regarding these.

And so for palifosfamide, there are 2 Phase III programs. The first is metastatic soft tissue sarcoma, second small cell lung cancer. This molecule has potential in multiple tumor types, for example, an investigator sponsor studies or Indiana University sponsor study has just started in testicular and ovarian cancer. And again, underpinning this is exceptional IP running through 2029. The synthetic biology program being done in partnership with Intrexon currently is in 2 Phase II programs, the first melanoma, second breast cancer. And underpinning this, we're exploring multiple opportunities for totally new paradigm treatment modalities. And I'll get into some details regarding that.

Shown here are the major upcoming milestones, coming up soon and in the next 18 months. PICASSO 3, the Phase III sarcoma study, we expect to announce top line data the last week of March. Following on that, a ASCO late breaking presentation or abstract, and then a possible NDA submission.

For the small cell lung cancer program, MATISSE, it's a Phase III, this trial is enrolling again ahead of schedule. We expect to have the first major interim analysis for that with data at the end of this year.

For synthetic biology, there's 2 Phase II studies, melanoma and breast cancer. And again, we expect data to be coming out of that starting in the middle of the year and then running towards the end of this year into next year.

I'm now going to focus in some detail on palifosfamide. And what this is, is a highly potent bi-functional DNA alkylating agent. It has broad application in multiple solid and liquid tumors. It is derived from the active metabolite of ifosfamide and has a rigorous, again, system in terms of the way it's set up. It's activity in multiple tumors is seen because of the nature of the molecule and the fact that it evades many resistance pathways. For example, it works in cancer stem cells that have high LDH. It is in class with bendamustine and cyclophosmphamide. In fact, the stability and the characteristical reconstitution are nearly identical to bendamustine. It also has a much lower toxicity because of the absence of several different metabolites, and of course the PK here, which is unique because this drug is the active component, it's not a prodrug. And so, again, the very high concentration of this, together with the PK, results in many of these favorable effects.

As it's known, there's also drug studies for soft tissue sarcoma. And again, the IP here, which is strong, that has a long run rate here into 2029.

The soft tissue sarcoma program has come about based on extensive work pre-clinically, clinically, and again, a lot of knowledge about this disease, but internally and from several experts with whom we worked, both the United States and Europe.

And so in sarcoma, once patients become metastatic in the first line setting, there's a very high unmet need. And the reason for that is that when patients are not metastatic, a vast majority are going to live. When they are metastatic first line, a vast majority are going to die from the disease.

In terms of the numbers for first line, and we've articulated this before and this is based on IntrinsiQ from AmerisourceBergen. But the 12-month rolling number is about 9,000 prescriptions written in the U.S. We're estimating about 14,000 in Europe. And again, as we're looking at sarcoma, it is in transformation because last year, the FDA, subsequent to an ODAC meeting, gave full approval to Votrient for second line, not first line, second line with PFS as an endpoint. And then subsequently, in August, in Europe, again this drug got full approval.

And so let me refer back here to data from the FDA, and this data from the FDA were represented by the FDA reviewer at the Votrient-ODAC meeting, which is roughly 1 year ago. And what the FDA review had noted was the following -- and presented, and that is that an SPA was not pursued by GSK -- by the applicant, that what FDA had recommended at the end of Phase II, which is, again, consistent with what we have been doing, what we've heard, is that if PFS is used as a primary endpoint, the study should be powered for OS, it needs to be independent blinded radiologic review, the magnitude of PFS benefit needs to be robust, and of course, an appropriate risk-benefit ratio, in other words, a balance in terms of toxicity between the odds.

Looking specifically at the Phase III study that we're doing, PICASSO 3, a lot of these parameters are right there. And so, again, this study is set in terms of being powered for both PFS and OS. Notable and new is the following -- and that is in the study, as of now, PFS is the primary endpoint and for protocol, its primary endpoint, full approval. OS is a secondary endpoint. This modification has been done, incorporating changes with dialogue with FDA.

As we're doing this, again, the nature of the study I think is well-known to most and that is comparing palifosfamide plus doxorubicin versus placebo plus doxorubicin. Again, the PFS analysis here is being done by a blinded radiologic review. And then an efficacy analysis by the Independent Data Monitoring Committee.

The data and the results we expect to announce at the week of March 25 or the following: and that is top line PFS data, together with the Data Monitoring Committee's OS, overall survival, futility analysis.

Again, to remind everyone as regards PFS as an endpoint and in terms of where the policy is, where they are at and what they're doing, in 2011, there were 4 drugs approved based on PFS as a primary endpoint. In 2012, there were 7 drugs approved with PFS as a primary endpoint. And in 2013, there have been 2 drugs, so far, approved with PFS as a primary endpoint. Again, consistent with FDA policy as articulated by them, and again, consistent with the amendment, as done now, to this protocol, with PFS as a primary endpoint, for full approval.

Notable here, as well, is that amongst these 13 approvals, approximately 7 were in the first-line setting. Shown here are the randomized Phase II data, and this is the foundation for the Phase III study.

Let me highlight certain aspects here. And again, the median difference was about 3.5 months. The control group came out at 4.4 months. The hazard ratio was 0.43. OS was trending in a positive direction, with a hazard ratio of 0.78. And again, this was in the presence of crossover. So it was not a blinded study, and there was crossover. As compared to the currently Phase III, which is blinded with no crossover.

And again, as regard to safety, it was similar between both arms. Based on this, and based on extensive work with the ERTC and the ERTC database, or some 3,000 patients with metastatic sarcoma, there's a strong belief by all the experts involved here that this study, the Phase III study, has been directly modeled and powered for PFS and OS.

Very helpful in terms of that is the most recent randomized data to come out of ERTC, and this data were presented at ESMO last year and many different aspects here. But key amongst this are the following: and that is the control group, and the kinetics and the median of the control group, came out in a way that was strongly supportive of the data seen in the Phase II study, the PICASSO Phase II.

Moreover -- again strongly supportive of the modeling that has been done for Phase III. And so again there's a high degree of confidence by all the experts involved here that the Phase III study control group of doxorubicin is correct and is correctly modeled.

The hazard ratios are as shown here, the hazard ratio for PFS and OS. And again, similarities between the 2, there's a greater magnitude of benefit that is being seen with palifosfamide and there's several potential explanations for that, but it's certainly -- it sets the stage well for the randomized Phase III.

One key difference here, and that is again looking at the risk-benefit ratio. And so for the ifosfamide in the ERTC study, there's a major imbalance in toxicity. In other words, ifosfamide is severely toxic to the extent that the dropout for toxicity were totally imbalanced. There were about 17% coming off on the ifosfamide arm versus 2% on the non-ifosfamide arm, so there's severe imbalance.

A marked contrast with palifosfamide, again, a high degree of balance, with great similarity between the 2 arms. And so again getting back to the FDA criteria again, this risk-benefit ratio with ifosfamide is imbalanced and going the wrong way, whereas with palifosfamide, it is balanced and going the right way. And that, again, is the expectation in terms of what is going to be seen in the Phase III data.

I'm now going to shift to the second randomized Phase III, and that is in small cell lung cancer. This is a study, a concept, that came about through Dr. Larry Einhorn. Einhorn is the former head of the Indiana Cancer Center. He is the individual who got ifosfamide FDA approved and he is the individual who took testicular cancer from most people dying to most people being cured.

In small cell lung cancer, there's a very high unmet need. It has been very difficult to get any kind of movement there with any new drug. There's been no innovation in decades. It's a large market opportunity both in the U.S. and, of course, outside the U.S. and the rationale here from Einhorn and his colleagues in Indiana, and the Hoosier Oncology Group, was the following: and that is based on the study with ifosfamide in the 1990s, in the first-line setting and they showed a benefit when it was added to standard care, this was a randomized study with survival as an endpoint.

Indeed, this is the only study ever done outside of Japan that has shown a benefit and a difference as regards survival in small cell lung cancer, compared to standard care. The reason it never took off is because of the excessive toxicity, a marked toxicity of ifosfamide.

And so what Einhorn did, together with his colleagues, is approach us and did a Phase I study, again, in Indiana in the Hoosier Oncology Group, adding palifosfamide to standard care and showed a high degree of success in patients, who are very refractory, with the combination being well tolerated. And this was specifically in small cell lung cancer, but in addition, based to similar kinds of effects in germ cell tumors, both testicular and ovarian, which was promulgated, again in the India University-sponsored study. And indeed, similar effects in a few patients with sarcoma. It's a clear activity being seen when added in this combination.

The Phase III study that is being done is called MATISSE. It's an adaptive design. It's adaptive design were off through 125 events. There'll be an interim look by an independent committee and the trial will either continue with different sizes, continue with different powering assumptions or be stopped because at the top end, there'll be efficacy or at the bottom end, there'll be futility.

Again, this will be done by an independent committee and the goal here being to optimize the chances of success based on data. This trial is enrolling ahead, quite far ahead of projection. And so as of this time, there are about 150 patients randomized, and this is going very quickly. The first IDMC review of 20 patients were successful. And again, this interim analysis of 125 events is expected at the end of this year.

Shown here is the market potential, with various numbers, various data. And again, based on the current projections, as regards soft tissue sarcoma, small cell lung cancer, for the U.S. it's estimated that there'll be greater than 1 billion in terms of cell recipients. As we get to the global market, the potential becomes a whole lot higher.

I'm now going to shift into synthetic biology. And this is a program that is expanding, and expanding quite dramatically in terms of, again, the quantity and quality of work being done. We're doing this in partnership with Intrexon, which is a very strong partnership. Intrexon are a private company who are devoted to synthetic biology. They are the clear leaders in this field as of this time, in other words, their technology, their approach, their architecture, their modularity of DNA is unparalleled.

We're using this revolutionary technology for very precise controlled delivery of DNA to get proteins expressed in vivo. So in other words, going back to biotech 1.0, which started in the '70s and then '80s, '90s and early 2000s. DNA has been expressed in bacteria and yeast and the proteins then extracted, purified and then used therapeutically. As we envision biotech 2.0, what we're doing is, again with very powerfully controlled and controllable DNA, expressing it directly in vivo in mammalian cells, in people. And getting the same or similar or even better proteins that are going to be therapeutic.

The lead candidates here is IL-12, it's in 2 Phase II trials as I mentioned. We're working diligently and extensively here with the next generation of therapeutic approaches, and these include modular inducible cancer immunotherapy, different ways of giving antibody therapy and key to this, in particular in cancer, is a multigenic approach. And again, as we look at cancer, as we look at the understanding, with the big data that we have right now, the different pathways, a multigenic approach being done successfully, and we believe we can do that, we think is going to be absolutely instrumental in shifting the paradigm as regard how we treat cancer and the outcome in terms of patients with cancer.

Key to a lot of what we're doing right now is an intron component, a software component with which we are able to switch on and switch off expression in vivo. And again, we're using natural cell biology, but controlling the way that these proteins are expressed. And the way this is done is with an old activator ligand, and absent that ligand, it's set in the off position, with the ligand it goes with the on position. And we've shown, clearly, now in patients the ability to control expression, to control expression of the rheostat, in other words in a delicate, dependent way, and elicits function from that protein that's being expressed.

While the first clinical study has been in melanoma and some of the data are shown here. And in the Phase I component here we have determined what the biologically effective dose is. And that's being used for both melanoma and breast cancer. We've seen clinical activity in the highest dose cohorts. And the dose response, as regard to the level of protein, the immune response and the clinical response. And there've been no deal [ph] seen to date. A Phase II is ongoing in melanoma and we expect to get the data from that some time towards the end of this year.

Now this is where it really starts getting interesting. And so what we spoke about earlier this week is the Phase II trial in breast cancer. The reason this is really interesting is that what has been observed now by several major groups in the world, for both in Europe, in places like Paris, and different areas in the U.S. when we treat women with chemotherapy in breast cancer, one of the best predictors of outcome is the immunal response in the tumor. In other words, there's a tight correlation here between giving non-immunotherapy, like chemotherapy, and the immune response.

We've done a series of preclinical studies and, in those preclinical studies, tested several different agents. Palifosfamide was used as a test agent and really essentially initially as a control, has been expected to perform that way, but it performed, by far, the best. And it fits in exactly what the rationale as regard to what is understood, connecting different chemotherapy type agents like palifosfamide to immune response, and correlating a lot with all the recent publications that have come out of Institute [indiscernible] Rossi, Mayo Clinic and other centers here in terms of the importance and the ability to synergize. And we've seen strong synergy preclinically.

And so this is a study, it's a randomized study up to 68 subjects, with current metastatic breast cancer on the chest wall axilla. There's an endpoint here that is very, very reliable and good enough for 16-week PFS rate. There's a several different secondary endpoint. We'll be doing biopsies here and we believe we'll be able to get to a very cogent answer here in a reasonable amount of time. And again, where it gets really interesting is the following: and that is that the regulatory landscape of breast cancer is changing. In particular, in the neoadjuvants, in other words, doing what we're doing now and moving it to treating people, women with best cancer, prior to operation. FDA has given guidance recently, and it's a draft guidance which should be formalized as regard pathologic complete response as a validated endpoint for accelerated approval. And what we're looking to do is potentially rapidly position this combination from the refractory setting into the neoadjuvant setting.

Shown here is an additional approach, and this is the approach and something that we've articulated at the AACR ERTC meeting end of last year as regards to systemic, systemic use. And so, in this particular example, and this is again, in the preclinical setting currently, what we're doing is injecting DNA into muscle. DNA in muscle is a very viable and very powerful embedded controllable bioreactor. And we've been able to do this with very high expression of protein for a sustained period of time. And again, with this kind of approach, it gets really interesting as regard the ability to express not just one gene, but multiple genes.

And so, one of the key powers that we have is the following: because we've got the software and the know-how, as regard the Intrexon technology, we can do and we're doing and we'll do a lot more of the following. so shown here are 4 different marked of genes. At the very top, we'll call it the green one, next is the blue one, next is the red, next is the purple.

On the right hand panel, the level of expression. And key here in the bottom line is that we can combine all 4 -- 1, 2, 3, 4 together, use a lot of software to control it with the introns we have. And we can get the same or even higher expression of all 4.

And so what we're envisioning is taking this and using this and applying this to various ways of treating cancer. Because clearly, cancer is a multigenic disease, and as we do this, being able to control how we turn on the different ones over periods of time.

And as I said, this is where we expect it is not just going to get interesting but absolutely intriguing and paradigm shifting.

To conclude, the financial highlights are shown here and these are the data as of the end of Q3. The primary shares outstanding 83.2 million, the cash position $95.3 million and the cash resources expected to support operations into the second half of 2013. And that's, again, assuming that we continue going full throttle with all these programs.

Let me conclude, again, just in terms of the upcoming data, which is over the next 18 months. The last week of March, the week of March 25, somewhere during that week, top line data from PICASSO 3, following on that, the ASCO late breaking abstract potential NDA submission for MATISSE. Again, enrolling here way ahead of schedule. The interim analysis data towards the end of this year. And then ongoing and now accelerating the Phase II studies in melanoma and breast cancer in terms of using IL-12 DNA in the synthetic biology program.

With that, I will conclude. And again, thank Barclays very much for including us. Thank you all very much.

The room is directly across the hallway.

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