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ONYX Pharmaceuticals, Inc. (ONXX)

March 14, 2013 8:30 am ET

Executives

Julianna Wood - Vice President of Public Affairs

N. Anthony Coles - Chairman and Chief Executive Officer

Helen I. Torley - Chief Commercial officer and Executive Vice President

Barbara Klencke

Ola Landgren

Bert O'Neil

Christopher Kirk

Matthew K. Fust - Chief Financial Officer, Principal Accounting Officer and Executive Vice President

Analysts

Geoffrey C. Porges - Sanford C. Bernstein & Co., LLC., Research Division

Rachel L. McMinn - BofA Merrill Lynch, Research Division

Terence C. Flynn - Goldman Sachs Group Inc., Research Division

Marshall Urist - Morgan Stanley, Research Division

Robyn Karnauskas - Deutsche Bank AG, Research Division

Cory William Kasimov - JP Morgan Chase & Co, Research Division

Steven Silver - S&P Equity Research

Howard Liang - Leerink Swann LLC, Research Division

Biren Amin - Jefferies & Company, Inc., Research Division

Ryan Martins - Lazard Capital Markets LLC, Research Division

Michael G. King - JMP Securities LLC, Research Division

Julianna Wood

Good morning. It's a pleasure to welcome you here today. I'm Julie Wood, Vice President of Public Affairs. And we really are happy to share this Analyst Day with you. Of course, before we start, I have a couple of announcements. We will be making forward-looking statements today. As you know, forward-looking statements are inherently risky, so we direct you to our filings with the SEC, in particular, our latest 10-K, which not only delineates the business but business risks as well. Second, we will be having a couple of clinical investigators join us for the presentation today. As a reminder, Onyx can only comment as to the FDA-approved indications for Kyprolis and Stivarga. So answers to any questions outside of these indications will be based upon information that has not yet been confirmed by the FDA. It will be the investigator's personal experience and we at Onyx cannot comment on that.

With that, I thank you, again. We're happy to have you here. And I'm going to turn it over to Dr. Tony Coles, our Chairman and CEO.

N. Anthony Coles

Thank you, Julie, and good morning. Thank you for joining us for the 2013 Capital Markets and Analyst Day. We're pleased to be here to share the evolving Onyx story, the transformation of the company that we've been talking about over the last several months and the delivery of proof in so many ways as the story advances. Before I get started with a few brief introductory prepared remarks, I'd like to introduce the members of the executive team who are here with us in New York, joining us for this special occasion. As I call your name, if you'd be -- please stand and give a little bit of the royal wave, that will be terrific. So we'll ask Dr. Helen Torley, our Chief Commercial Officer, who's joining us; Matthew Fust, our Chief financial Officer; Dr. Pablo Cagnoni, his first public appearance as the Onyx Head of R&D. So welcome Pablo. And he has responsibility for all of R&D and technical operations. Dr. Juergen Lasowski, our Head of Corporate Development and Strategy; Suzanne Shema, the General Counsel and the Corporate Secretary.

Also joining us are Dr. Barbara Klencke, known very well to many of you who has filled in admirably as a terrific leader for the clinical organization. Please stand, Barb. Very good, thank you.

Julie Wood, all of you know, and she just introduced our program; and Dr. Christopher Kirk, who is our Vice President of Research. And you'll be hearing more from Chris later in the day.

So the story continues. Several months ago, we talked about the opportunity to transform the company. It was an aspiration. It was a dream at that time and now, we are standing in the reality of the promise that we made to you, having expanded the company. This is a story evolving around the evolution of a pipeline and a portfolio, the delivery of products and most importantly, the delivery of product-driven top line sales growth opportunities, which is the ultimate objective for what we do. At the heart of everything we do and you've heard me say this before, are the patients who we care for and who are counting on us and we rely on them and the opportunities we bring to them to continue to grow this great company.

Our objectives are really quite simple. It's to continue the successful launches of Stivarga and Kyprolis, to expand their indication opportunities, to continue to grow Nexavar, to do all of that in the United States. And for Kyprolis and the proteasome inhibitors franchise, in particular, to begin doing that outside of the United States, which is a key milestone for 2013. So we title this day, the Next Chapter Begins: Breakaway Growth.

For the agenda today, I'm, as I say, going to make a few brief remarks. And then I'll ask Dr. Torley, Helen Torley to join us to update on the performance of the 2 recent launches as a result of the FDA approvals in 2012, for Kyprolis and for Stivarga. Helen will also talk about the growing importance to the indication expanding opportunities for Nexavar and bring together the context that we're operating in. Helen will be followed by Barb Klencke, who will talk about the proteasome inhibitor franchise. We'll provide some important updates in terms of the clinical trials, but most importantly, discuss the front line strategy and study design with you today.

Dr. Ola Landgren, our -- one of our 2 special guests today, a senior investigator at the NIH and the primary investigator on one of the most important front-line studies for Kyprolis, Revlimid and dexamethasone, will be here to share his data with some updates and the importance of the work that he's doing in the newly diagnosed setting. Barb Klencke will join us, again, to talk about the kinase inhibitors and palbociclib, the Pfizer therapy PD-991 that is being advanced in metastatic breast cancer. And then Dr. Bert O'Neil, will discuss Stivarga. Chris Kirk will come and provide some insights into what we're doing on the discovery side of Onyx. And then I'll join you, again, at the end to moderate our Q&A session with the presenters.

So let's talk a little bit about the evolution of the company. We use the word transform frequently but we really do think what has happened is nothing short of spectacular for Onyx. Nexavar, half our product essentially, when joined the company in 2008, shared with Bayer Pharmaceuticals and with growing success around the world, most importantly in the emerging markets and in the United States, where there has been growth. Europe we've been challenged, but that has been offset by growth in these other areas. And in moving the company from its dependence on Nexavar through the evolution of an approval for Kyprolis on an accelerated approval basis and approval for Stivarga, which is the subject of our settlement with Bayer Pharmaceuticals in 2011, with great promise behind those 2 therapies, which is starting well in the marketplace, added by oprozomib, the potential to be one of the first oral proteasome inhibitors and palbociclib which I just mentioned a moment ago. Our objective is clear: become a global oncology leader.

Let's talk a little bit about the evolution for each of these. Nexavar with very important data in thyroid cancer. That will be the subject of a supplemental NDA later this year. For Kyprolis, a broad comprehensive global development plan across multiple lines of therapy, which we see as a means of bringing Kyprolis to more patients, if those studies are successful and, importantly, contributing to the top line sales growth for the company. And in Stivarga, a surprise for everyone, the sales for 2012 and a 20% net sales royalty that Onyx derives on that basis, adding a very nice complement on the cash flow side of our business to offset the investments that we're making in the proteasome inhibitors.

So how will we continue to accelerate this topline growth? Well, 3% to 7% growth for Nexavar in 2013, which, for a brand that is nearly 8 years old, we think is very strong, particularly given what its come to in the emerging markets and in the United States. That growth we expect will be supplemented not only by the additional data in thyroid cancer and indication opportunities but potentially, data from the emerging breast cancer study, the RESILIENCE study, that leverages outstanding Phase II results from a couple of years or so ago for which we expect to announce enrollment completion this year.

Growth in the emerging markets, new indication opportunities and, adding to that, on the kinase inhibitor side of the business, Stivarga, with the opportunity from the 20% royalty stream already approved in the United States in metastatic colorectal cancer, already approved in the United States for GIST and pending regulatory actions in the key markets around the world. We expect those and updates on those in the near-term for both the EU and for Japan and the opportunity for new indications globally as a result of the broad Phase II program for Stivarga, as well, which Dr. O'Neil will discuss with you momentarily.

And then finally, for Kyprolis, our first wholly owned and proprietary therapy. Wonderful for us to have because it gives us the opportunity to enter the markets outside of the United States. The sales performance in the U.S. has gone extremely well. We've disclosed and discussed the sales performance for 2012 since the approval. But importantly, the opportunity for continued quarter-over-quarter growth throughout 2013, which is something that we're quite excited about as physicians continue to indicate a preference and a desire to write even more Kyprolis. The potential, x U.S., we expect is also large. The European demographic support, a size market opportunity similar to the United States. Then outside of Europe and the U.S., we're contemplating the local partnerships that will be required to support global expansion.

And strategically, and we've discussed this as well, the goal is for us on the kinase inhibitor side of our business to decrease the R&D investment, which you can see in the numbers that we reported for Nexavar for 2012. I'll remind you that for Stivarga, we have no R&D development expense responsibilities, Bayer funds those trials solely. And for Nexavar, as the decision in the RESILIENCE studies wind down, you'll note that the cash flow and the contribution margins from Nexavar will continue to increase, which is the way we've designed the business when we decided to invest in the proteasome inhibitors. So as the R&D investment for Nexavar goes down, Stivarga, of course, will only be expense-free royalty income for us with the opportunity to expand on the top line through additional indications. And the 2 that are already approved, we expect that the opportunity to offset the R&D investment that we'll be making in the proteasome inhibitor's investment for these proprietary therapies, which we own 100% of around the world, except Japan, gives us an opportunity to provide all of our support behind the most important growth drivers for Onyx.

Kyprolis is a focused study in the relapsed and refractory setting. The ASPIRE study in the relapsed setting. The ENDEAVOR trial, which is the head-to-head comparison of Velcade and oprozomib or Kyprolis in the relapse setting. And today, for the first time, we announced the CLARION trial. The front-line study that will be comparing Velcade and Kyprolis in the front-line setting and we'll discuss the protocol design with you in a moment. CLARION, because it brings clarity. CLARION, because it is a call to action. CLARION, because we expect that this will be a definitive opportunity for Kyprolis in one of the most important patient populations in this dreadly disease.

And then for oprozomib, additional data that we're expecting, Phase Ib/II data, that will be discussed next month at the IMW meeting in Kyoto, Japan, and the continuation of that program once the dose has been identified to myeloma patient studies, specifically.

I've talked about globalizing our business. You'll see in the dark green, Alaska, the continental United States, as the place where we have the proprietary responsibility. Our sales force is there on a daily basis, educating physicians, interacting with office staff and making sure that Kyprolis gets to every eligible patient in this country. In the lighter green, you see the core EU markets, Germany, France, Spain, Italy and the United Kingdom, where we are making plans today to leverage this small core leadership team that we have in Zug, Switzerland, and expand the team at the signs of regulatory progress in that market. Positive data from the FOCUS or the ASPIRE trial, will unlock investment opportunities for us in Europe and those activities will be gated based upon regulatory progress and success.

You'll see Japan there in the orange sliver to your far right. That is what -- the territory that's been licensed to Ono Pharmaceuticals for both Kyprolis and oprozomib. They're advancing Kyprolis through Phase I and doing a very nice job of building a strong presence for this therapy in Japan. And in the rest of the world, in blue, where we have commented that we will, of course, select market opportunities. Notably those markets where there can be a commercialization on the basis of the U.S. approval, we will take local partnerships to provide Kyprolis to patients in these key areas.

So you can see that clearly, germane to the Onyx story, the Onyx evolution, the transformation, are a number of important key clinical milestones: The initiation of the CLARION study; the FOCUS results, which we expect on an interim basis as early as the second half of this year; the ASPIRE results in the fourth quarter or later; completion of the ENDEAVOR trial; and then, for oprozomib, the data that I mentioned, upcoming next month at the IMW group meeting in Japan.

For the kinase inhibitors, the Phase II RESILIENCE enrollment is actually complete. So we are proud to announce today, that the breast cancer program for Nexavar has finished enrollment, the initial target enrollment. And this, we consider a great sign because that means that we have an opportunity to speed the availability of data for the breast cancer program. The sNDA filing for thyroid and for the Stivarga, the regulatory actions I mentioned in the EU and in Japan, and the new Phase III trials, which Dr. O'Neil will discuss when he joins us here at the podium.

So you can see that this is a year that is filled already with important accomplishments. The sales progress that we've talked about for 2012 and a great start to 2013 in terms of sales; the quarter-over-quarter growth that we're projecting for Kyprolis; the performance for Stivarga already in the U.S. with the addition of a second indication and approval in GIST; the filing of the sNDA for thyroid; and very importantly, the completion of the Phase II RESILIENCE breast cancer study, which has just finished its target enrollment.

So how will we continue to build Onyx? It must be a question on everyone's mind. We've got such a great start, a great foundation to expanding the pipeline and portfolio of our business, what will be do for next act beyond Kyprolis, Stivarga, oprozomib and palbociclib? Well, that's quite a portfolio and quite a pipeline in and of itself and there is an opportunity to continue to grow, invest and deliver topline results from this lineup of what we expect to be great therapies that can, indeed, change the face of cancer treatment. But we haven't gotten here without some thought and without some care, both for R&D collaboration such as the one we have with Bayer, the one we had with Pfizer that produced palbociclib, so R&D collaborations remain key and essential to driving the future growth for our business.

But we are evolving and moving into a phase of deals. We've talked quite frequently about the opportunistic approach that we have taken to in-licensing opportunities, option arrangements, product acquisitions, company acquisitions. And it's from this menu of opportunities that we will continue to expand the pipeline for Onyx. We love this approach. It minimizes the amount of risk that we've taken on in the early discovery phases, which is the most riskiest and the most expensive. And we love the notion that it provides an opportunity for us to create value, to diversify our risk, yet continue to deliver benefit to patients and value to shareholders.

So looking ahead, if you consider the history that we've had in corporate development transactions, first in 2008, the BTG transaction, which brought us 0801; the S*BIO transaction, which was terminated and those assets were returned. You'll note 2 things. One is that once we make a decision to support a program, we go full bore, we invest, we put our money where our mouth is. However, if we have early signs that these assets are not going to be competitive or promising, we do our best to find the better home for them outside of Onyx. And that's what we did in the case of the S*BIO assets. Proteolix is the gift that has continued to give for Onyx through Kyprolis and it brought indication opportunities realizing now that it's not just a good compound, it's a great therapy. And then beyond that, what we will focus on, assets that bring scientific rationale and a fit with our business in oncology, a strategic fit with where we are strongest in the cancer space, both developmentally and on a commercial basis. And then importantly, a focus on the key tumor types where the unmet need is the greatest and the commercial opportunity and benefit to patients is the highest.

So I think that with that broad overview of the company, what I'd love to do is now transition the program to Dr. Helen Torley. Helen joined us approximately 15 months or so ago. Has done a remarkable job in the launch of Kyprolis and the launch of Stivarga. And has been a wonderful partner for me and for the rest for the executive team, driving performance at the highest levels. Helen?

Helen I. Torley

Thank you, Tony, and it's a pleasure to be here. 2012, certainly has been transformative year for Onyx, with our 2 U.S. launches of Kyprolis and Stivarga, driving at top line sales growth. As Tony mentioned, this is just the beginning. And in my presentation, what I'm going to review is the full range of potential sales growth accelerations for 2013 and beyond.

Our commercial strategy is built on 3 pillars. The first is grow. We've plan to compete and grow in our currently approved indications. The second one is launch. And we'll walk you through a range of future potential new indications, but also, new brand launches, for example, with oprozomib. And finally expand. We have the opportunity with Kyprolis to expand our global reach. And also, with future brands, set the basin work for taking future brands that we have globally. So this is our framework for future growth. And these will be our engines. Tony's touched on these in the proteasome inhibitor franchise with Kyprolis and oprozomib, which is still in development. And in the kinase inhibitor franchise, we have Nexavar and Stivarga. I'm going to focus on the launch brands and in a few moments, Barb will come and talk about oprozomib.

So let me start with the global proteasome inhibitor strategy, beginning first of all with what the patient opportunity is here. This slide reflects, for the U.S. and the top 5 EU markets, the annual new multiple myeloma patient treatment opportunities by line. You can see there's significant opportunity in all lines of therapy with the largest opportunity being in the earlier lines of therapy, not surprisingly. Let me just pause a moment and talk about what these numbers mean. And I'll focus on the third line, U.S. population, which we see is 10,000 to 15,000 patients, as that's where Kyprolis is indicated today.

This 10,000 to 15,000 means that each year, these patients present the physician ready for a new therapy for their multiple myeloma, after they have gone through 2 prior lines of therapy. Breaking that down further, that means that every month, there are, as I take our point in that range, 1,000 patients who are available for new therapies for third line plus. Before Kyprolis was launched, these patients were traditionally treated by having a recycle of priced therapies they've responded to, perhaps a Velcade-based or a Revlimid-based regimen. It could be they're treated with cyto-toxics or they could just be treated with dexamethasone. So that gives you some idea of the patient inflow here. And it's very important to recognize, this is a very dynamic marketplace with patients moving between lines and becoming available for the next line of therapy constantly.

Our global registration program is designed to allow us, over time, to be able to access all of those lines of therapy. Obviously, with our current approval being in those patients who are the third line plus who've been exposed to Revlimid and Velcade and are progressing on or within 60 days of their last therapy. This program is designed for not just regulatory approval. Very importantly, it's also designed for commercial success. With endpoints that are important to both regulators and payers, such as overall survival and progression-free survival. And importantly, 2 head-to-head studies, as you just heard from Tony, where, in a world where comparative effectiveness is becoming more and more important and more and more requested, we'll be poised and in a good position to respond to questions there.

We're also studying Kyprolis in a range of doublet and triplet regimens. Again, very important as we think about the commercial implications and launches for Kyprolis. The first potential in new data is going to come later this year with the FOCUS study, potentially reading out in the second half of 2013. And the ASPIRE data, potentially having a readout of the interim data in the fourth quarter or later. Based on that, from a commercial standpoint, we've already initiated planning for launch readiness for those indications where for Europe, for example, the filing could be based on FOCUS, or FOCUS and ASPIRE, and we certainly want to be prepared and ready to capture that opportunity.

Now what are some external projections as to where the multiple myeloma marketplace is going to go? You can see on this slide one of these external sources that predicts a doubling of the multiple myeloma market over the next 7 years. Key drivers of this is the approval of novel agents in multiple lines of therapy.

Now let me turn to the U.S. launch. After our approval in late July, we were able to launch almost immediately, taking Kyprolis to patients in need. I'll spend a few moments just reviewing the strategy we took as it's important to establish, I think, why we saw such success in such a short period of time. Our initial target audience was, approximately, 2,000 clinics and hospitals, which were selected because that's where the majority of multiple myeloma patients and, importantly, third line plus myeloma patients are treated today. Within the first 5 months, about 75% of those clinics and hospitals ordered Kyprolis.

One of the important factors when you're launching an injectable drug which is a miscellaneous J-Code, is assuring physicians rapidly gain confidence in the coverage and reimbursement. And if you recall, we were able to obtain confirmed coverage in all 12 of the Medicare advisory administrative carriers and the majority of commercial clears very quickly. The next important stage is what is the time to payment as the physicians in their offices reimburse claims. And that was another, I think, core success factor for the launch. We just looked at some benchmark data and the time to payment of claims in Kyprolis are the very top of the list of recent oncology launches.

And why is that important? Because as a physician begins to think about adopting a new injectable product, they want to see that they're getting paid and they're being paid in a timely manner. And I certainly think our success in coverage and reimbursement has been critical to the repeat use of Kyprolis we've seen in these adopting clinics. And finally, where do we stand in terms of share? We estimated as we enter 2013, that we had achieved over 30% share of the third line eligible prevalent patients. This, I think, is a terrific accomplishment in just 5 months.

Now that was 2012. We left 2012 with an established broad base of prescribers. And what do we project for 2013? This is data we talked about on the call that, when physicians were asked during the fourth quarter who had adopted Kyprolis, what their future intended use was, over 70% said they plan to increase their use of Kyprolis. We believe this is because of all of the responses that they are seeing in their use in clinical practice. So this is what gives us the confidence to say, we still have room to expand the number of prescribers. Our prescribers are saying they're going to increase their use as they go forward and that's why we believe we're going to see quarter-on-quarter demand growth for Kyprolis in 2013.

Now if I can take you back to that discussion we had a moment ago to say there are approximately 1,000 new treatment opportunities for third-line-plus patients every month. We asked physicians at the beginning of 2012 as they looked forward to expected approvals of novel agents, what percentage of patients were they likely to use, of the third-line-plus population, were they likely to use a novel agent in? And at the beginning of the year, they said 40%. Towards the end of the year, we asked them again and they said 70% of their new treatment opportunities would get a novel agent.

What does this mean? It means that physicians are saying instead of recycling old therapies, instead of using dexamethasone or using cyto-toxic agents, they're going to pick a novel agent. And so when you think about that 1,000-patient treatment opportunities, this information tells us physicians are wanting to give these patients the novel agents as their next therapy, showing I think a sizable patient opportunity as we move forward. And in the U.S., what are the external projections for growth? Certainly, substantial growth across all lines of therapy. And if you focus on the red section, where Kyprolis is approved today, more than a doubling are predicted by this external source.

Taking a look now at the expand part of our strategy. As you're aware, in preparation for the U.S. launch of Kyprolis, we built full commercial capabilities to be able to launch. As we look at Europe, we did a careful assessment and determined our best approach for Europe is going to be that we focus on a core set of European markets that I will illustrate in a moment and we'll go it alone, building the required commercial capabilities to do this. In select markets in Europe, outside of that, we'll work with local partners who will distribute Kyprolis.

And for the rest of the world, we have an opportunity, based on the U.S. approval, to enter some markets who recognize that U.S. approval. We will not do that by building infrastructure though. We will do that by, again, selecting local partners who will make Kyprolis available in those marketplaces. And finally, just a word in Japan. As Tony mentioned, Ono Pharmaceuticals is developing and commercializing Kyprolis in Japan and Onyx will receive a milestone payment as well as a royalty upon sales success.

So this is where we're going to focus in Europe. A map of -- I don't think it'll be a surprise to you where the majority of a multiple myeloma opportunity is. We plan to build affiliates in the key 5 markets: France, Germany, Italy, Spain and the United Kingdom. And we will access the other markets as we see reimbursement being successful. Similarly to the U.S. and, if you recall, we did not deploy our sales force, hire actually and deploy our sales force, until we achieve the milestone of a positive ODAC. We're going to take the same prudent approach in Europe. Un-dating the resources as we see progress in achieving our milestones. Now, we do have a small core team who are already working in Europe, focusing on medical affairs activities and reimbursement and access activities because, as I mentioned, we certainly want to be prepared for the earliest possible launch.

Now in Europe, everybody knows how important not just getting approval -- regulatory approval is, we need to assure we're going to be successful with reimbursement. And this is the framework our team is using. We're hiring and have hired a number of experts who have been successful in gaining rapid reimbursement at the target price in Europe, just as we did buy hiring expertise in the United States. And this team have already begin working according to this framework to develop the story as to why Kyprolis will bring value. It obviously is going to depend very much on us seeing the FOCUS and the ASPIRE data.

So I know and often get asked questions about what price will we charge. Our price is going to be dependent once we see the data and we develop our story that can tell a compelling value story for Kyprolis for the European marketplaces. And EU market projections are considerable growth, actually faster growth than in the U.S. Again, driven by novel agents, but also approval of currently approved agents in some new indications.

And as we look to the rest of the world, we've mentioned, the opportunity that exists in multiple markets to gain access, just based on the U.S. approval. I'm very pleased to announce that we actually have signed our first agreement, which is in Israel. And as of this week, product is actually available for patients in Israel to begin receiving Kyprolis. We do expect to see additional agreements signed in 2013.

So in summary, for Kyprolis, I think you will agree, we have multiple drivers for growth. Still, growth potential, with the U.S. launch execution; launches based on the results of FOCUS and ASPIRE initially; and then are waiting for the results of ENDEAVOR and CLARION. And more near-term market expansion in these markets that will recognize U.S. approval. So terrific opportunity remaining for us to capture with Kyprolis.

I'll turn now to our global kinase inhibitor franchise. And just a word about our relationships or arrangements with this. Both products were partnering with Bayer. For Nexavar, Onyx core commercializes Nexavar in the United States and Bayer takes care of the rest of the world and we have a 50/50 profit share. For Stivarga. We jointly promote Stivarga in the United States with an equal number of representatives on both sides. Bayer commercializes in the rest of the world and Stivarga is a Bayer-owned compound, and Onyx gets a 22% royalty and global net sales. We have no investment in development and we have no investment in marketing for Stivarga. But importantly, we are participating and co-promoting Stivarga.

Beginning with Nexavar. Continued success seen here with Nexavar achieving over $1 billion, in total, at global sales in 2011 and continued to see Nexavar exceed the $1 billion in 2012. The Onyx portion or participation in this is shown in blue. Onyx does not have an economic interest in Japan as of the beginning of 2012. And for 2012, we did see 3% growth in Nexavar sales. And this was really driven by continued leadership and growth in liver cancer. And importantly, growth that's coming from the Asia-Pacific and Latin American markets. This topline growth and the ability we've had to reduce our investment in Nexavar had led to us being able to increase the cash flow contribution of Nexavar, which has been so critical to our ability to invest in the development of Kyprolis.

Now for Nexavar. We do see continued growth in liver cancer and in these emerging markets. But we have a couple of potential new indications I'll just spend a moment on. Beginning first with the DECISION study, which Bayer and Onyx announced in January, had met its primary endpoint of a significant improvement in progression-free survival. This is a study in radioactive iodine refractory differentiated thyroid cancer patients. This is an area where there's been no new treatments in the last 30 years and we estimated that in the U.S. there are, approximately, 3,000 to 4,000 patients who would fit the expected indication we would get for this if the FDA do grant approval for DECISION.

The second study that we'll potentially read out is the called the RESILIENCE study. And this is in the metastatic breast cancer population, patients with recurring or metastatic breast cancer. And the RESILIENCE population is highlighted with the arrow at the bottom there. It's in a HER-2-negative population and there are about 67,000 to 75,000 HER-2-negative breast cancer patients. For those patients who are hormone receptor negative and who progress on to receive chemotherapy, specifically anthracycline and Taxane, that is the population who are in the RESILIENCE study receiving Nexavar and capecitabine versus capecitabine and placebo.

Also illustrated on this slide is, just for information, is where the palbociclib population is. This is in an HR-positive population in a first-line treatment setting. And Barb, in a few moments, will actually describe a little bit more about the palbociclib opportunity. But clearly, between RESILIENCE and palbociclib, Onyx has an opportunity to be participating in 2 drugs in this very important and underserved marketplace.

On to Stivarga, our newest product in the portfolio and certainly an exciting time in September, as we launched metastatic colorectal cancer. Sales of $41 million in total for which Onyx received an $8 million royalty. I think the success that we saw here really was partly due to the unmet need. These are patients who have cycled through standard chemotherapy, VEGF receptor blockers, as well as EGFR receptor blockers. And I think that is a real reason why we saw such quick and broad adoption by physicians. Certainly, very pleased with that success and as we look at GIST, very recently approved by the FDA, our representatives and Bayer's have already been trained and are already out detailing physicians with regard to GIST. Patient population sizes for metastatic CRC, I think we mentioned previously. We estimate this is about 20,000 to 30,000 patients in the United States annually. And if we look at the GIST population, an underserved population, patients who have cycled through Gleevac and Sutent, the 2 currently approved products. That is a population of between 1,000 and 1,500 patients in the United States.

So just the beginning for Stivarga in terms of its launch trajectory and success in the United States. And importantly, as we look at the Stivarga's future potential for approvals, that is shown in this slide where you can see for Europe, we expect action in metastatic CRC in the first half of 2013. And for GIST, we will file that as soon as -- or Bayer will file that just as soon as the mCRC indication is approved. And for rest of world, choosing to illustrate Japan here, priority review received in Japan both from metastatic CRC and for GIST. And we are expecting regulatory actions in both of those cases in the near term.

So what I've hopefully been able to share with you is a very exciting future with multiple potential growth accelerators for Onyx and our proteasome inhibitor franchise, with the opportunity to continue the growth of Kyprolis based on its current U.S. launch and expand our availability near-term in those markets that are recognizing U.S. approval. We are preparing and we'll be ready for the earliest possible E.U. launches and U.S. launches of FOCUS and ASPIRE. And grow the opportunity based on the other ongoing registration enabling studies upon regulatory approval and success there.

In our kinase inhibitor franchise, again, multiple growth drivers. For Nexavar, continuing to grow sales globally in our currently approved indications and launch new indications upon approval. And Stivarga, just the beginning. Great success with the U.S. launch. We plan to take that success globally with our partner, Bayer, and grow through all of the rest of the world approvals. So 2 powerful franchises and 2 great engines for growth.

Thanks, very much, for your attention. And it's now my pleasure to introduce Dr. Barbara Klencke, who is our Head of Clinical Development at Onyx, who will walk through our development program. Thank you.

Barbara Klencke

Thank you, Helen. So it's a pleasure to be here today and what I'd like to do is share our development story with you. So in addition to talking about our pivotal trials and updating you on the progress we're making on multiple fronts, I also want you to really be able to get a flavor of not only what we're doing but why and how. And it's really to help understand how we approach the development programs that we'll talk about today. So essentially -- let me see. Here we go.

So we have, obviously, a very broad development program ongoing with Kyprolis. And I'll talk about all of the registration-enabling studies that we've started and that we have yet to begin with the upcoming start of the Phase III trial and front-line setting. But along the way, I think another key element of the body of evidence that we have and that we'll continue to develop are not only the pivotal Phase III registration-enabling studies but the multitude of additional studies from investigators, sponsored studies, eventually cooperative group studies and other possibly Onyx-sponsored work that may not be -- registration and intent. And I think you can see throughout our program developed today, already, the fruits of some of that work. It was, I think, a very key aspect of the development program that was initially started when Kyprolis was just finishing Phase I, to actually open investigator-initiated studies at such an early point and to advance them as broadly as was done.

1 example of this that we'll really highlight today is the front-line data. To be at a position before even starting our pivotal trial of having data from 6 different investigator-sponsored trials with different regiments in different patient populations, collected in different regions of the world, I think, has really set us up nicely for having pilot data that gives us a choice, gives us confidence in going forward in a randomized Phase III program. And what you'll see today is not only the conversation about the pivotal trials but some of the additional work. And I'll just highlight some of what we're planning to do and then Dr. Landgren will in a great deal amount of detail about his data set that he presented at ASH at the most recent conference.

So here are the pivotal trials predominantly. And I'll talk about each one of these in more detail on the subsequent slides, from FOCUS to our relapse studies of ASPIRE and ENDEAVOR. Our new front-line study of CLARION, we'll go through all of these. I'll start with the FOCUS, mainly because it's first one that could potentially have data readout. As we have said, it has an interim analysis prespecified in the protocol and that is coming up later this year. So we anticipate, if the interim is positive, of being able to have overall survival data for you by the second half of this year.

So this, as you know, is a relapsed and refractory patient population. Prior therapy requirement is 3 prior therapies or more and progression on the last line. This is a randomized study of Kyprolis mono-therapy, compared to the active regimen of a corticosteroid and optionality, oral Cytoxan, with a primary endpoint of overall survival. And sometimes we talk about this as our European registration approach, but it's global. It will be effective for global, supportive of global registrations everywhere. And even will be nice to update the label in a U.S. with the survival advantage once this reads out.

The FOCUS trial is our ongoing trial that's been fully enrolled since in 2012. This is a PFS endpoint study designed to show superiority with the addition of Kyprolis to Revlimid and dexamethasone. This is a 780-patient study. It has a primary endpoint of PFS. And was negotiated with the FDA to be both our confirmatory trial in the U.S. to convert from accelerated approval to full approval, as well as being conducted under a SPA, special protocol assessment.

In the European, regulatory health authorities provided us with scientific advice, as well, before starting the study. This also has an interim analysis prespecified that's coming up this year. If the event accrual continues to stay on target, and we are continuing to stay on that timeline that we've been talking about for the last 6 months or so, with an interim analysis of approximately at the end of this year, so earliest in Q4 of this year or in the next quarter.

Here's the ENDEAVOR study. And this is also an active ongoing study. We initiated this in the middle of 2012. And I think here is, what I wanted to say a few words about, is how we think about this. This is, of course, a very similar patient population to ASPIRE. So why conduct a second study, second label enabling company-sponsored study in the relapsed patient population? Well, Helen mentioned one thing, and she mentioned comparative effectiveness. And I do think that in these days, the bar is higher and higher. And I think it's so important for us to really collect the data that's going to be required to support not only registrations but reimbursement strategies. And to really be able to articulate the value of Kyprolis in an environment where there are many active therapies. So producing -- so providing data on the doublet therapy is useful. Providing data in a head-to-head comparison to Velcade, I think, is a key part of our overarching strategy of getting Kyprolis available as a standard backbone as the foundation of care in all lines of therapy. So this is our first opportunity to provide data that could show superiority to Velcade in a head-to-head comparison.

The other critically important factor is the dose and schedule that we're testing in this study. So as many of you know, we've looked at the dose response relationship within all of the clinical data that we've had and this really does substantiate the preclinical data that we've seen today. That is, we talked a lot about the importance of the depth and the duration of proteasome inhibition. And we see a nice dose response relationship but we're really gaining a significantly better proteasome inhibition with higher doses. So this is the 30-minute infusion, as compared to our labeled administration of 2 to 10 minutes. And with a slightly slower infusion rate, over 30 minutes, we're able to give a dose safely at 56 milligrams per meter square, double the recommended -- the currently labeled dose. So it's our first opportunity to actually gain a label for this higher dose, so we really think the safety and efficacy will be well-described on the basis of this study.

Finally, this is another relapse study. This is ongoing. This is a company-sponsored study. CHAMPION is a term that we've used to talk about a consortium of clinical trial sites that we're working with. These are community-based clinical research centers and have joined together in order to help us answer clinically important questions that are important to practicing physicians. One of the things we asked, or ask about all the time, is what about the weekly dosing? Why do our patients have to come in on 2 consecutive days, week after week? Well, we certainly know that with the 2027 dose schedule that's currently approved, consecutive day dosing is critically important to actually get the depth and duration of proteasome inhibition that we want.

However, as we've moved the dose up and we've been able to see greater depth of proteasome inhibition, we actually think it's relevant question to ask. Could we achieve a similar, if not better, depth and duration of proteasome inhibition with a higher dose and longer infusion? Could we actually get the same degree or better efficacy and what is the safety? So in this study, we're actually doing a Phase I study first of weekly dosing of Kyprolis in this CHAMPION network of sites. So we're in the dose escalation phase right now. We hope to have data for ASH later this year, in December. And once we identify the maximum tolerated dose or the maximum protocol dose, in this case 88 milligrams per meter squared, we would then extend this experience to a large Phase II effort, with 160 patients, really just to have a more robust assessment of its safety and efficacy. Now, so if we have data at ASH, it will be the Phase I data.

Another study that I think I'll mention in the relapsed and refractory patient population, is data that we've shown at ASH this past year. This is an investigator-initiated study performed at that MD Anderson Cancer Center. Kyprolis combined with Pomalyst and dexamethasone. And I just mentioned this because I think this study builds on a body of evidence, really, that have supported the combination of a proteasome inhibitor and an IMiD based initially on preclinical data and then clinical data with other compounds and, now, with our compound, with Kyprolis, first, with Revlimid and now Pomalyst.

And what we're able to see in these heavily pretreated patients is pretty robust activity in this investigator-sponsored trial. The incidence of adverse events were predominantly low-grade and, for the most part, hematologic. There were grade 3 and grade 4 hematologic adverse events and they were dose-limiting but the rate of febrile neutropenia was relatively low at 6%. There were no grade 3 for peripheral neuropathy events. So again, this is just part of our strategy to continue to support work that provides data of interest to practicing physicians.

And now, I'll turn to the first line setting. So as you know, we've been thinking long and hard about what our strategies should be in the front-line setting and we're so lucky to have the emerging data from 6 different investigator-sponsored trials over 5 different regimens. So Dr. Landgren and Dr. Jakobowiak have both piloted Kyprolis, Revlimid, dex. But we also have data with melphalan and prednisone, with cytoxan, with thalidomide. And across of these various regimens, what we've seen is a consistency. We've seen deep and rapid responses. We've seen strong proteasome inhibition in those studies that have been assessing that. We've actually seen eradication of minimal residual disease, a novel endpoint that Dr. Landgren is on the forefront of developing in terms of ways to look at molecular remission in this hematologic malignancy. We've seen broad combinability in multiple subpopulations: the elderly, the very, very elderly, high risk patients, et cetera. And we see fairly consistent results. This really gives us the confidence to move forward at this point with activating the pivotal study. And I think it's critically important for us, even though we want to develop Kyprolis in all lines of therapy in the front line with a drug as good as Kyprolis, I think this offers us the opportunity to give the greatest benefit for clinical benefit of patients.

So again, as I've been saying, as our strategy as in all other lines of therapy is a combination approach of a pivotal study with support of data, supplemental data, a suite of complementary or exploratory studies that will look at the range of Kyprolis in all treatment regimens and looking at novel endpoints such as the minimal residual disease endpoint. Ultimately, our goal is to establish an indication for Kyprolis that is as broad as the treatments indicated for the treatment of multiple myeloma.

So our trial, as designed, in the CLARION study, will be a melphalan-prednisone backbone. So this will be a Kyprolis versus Velcade, head-to-head comparison. Again, building on this desire to develop more comparative effectiveness data, to look head-to-head with Velcade versus Kyprolis, with a goal of superiority in the PFS endpoint. VMP, as you know, is the global regulatory standard. In fact, it's the only registered drug in combination in both the U.S. and in Europe. Revlimid does not yet have that indication, so this gives us that confidence as well.

And finally, just looking at trial design timelines. This provides us patient access faster than anything. In part, older patient populations, the VISTA regimen providing us the comparison arm assumptions, and really able to execute this trial, get data for patients and to move forward as quickly as possible.

This is the study in a little bit more detail. So it's a 1:1 randomization. It's a PFS endpoint. Kyprolis, when combined with melphalan and prednisone, as piloted by the French IFN group, has shown the dose of Kyprolis is 36 milligrams per meter squared, given over 30 minutes, would be the ideal dose to be given with melphalan and prednisone. This is compared to Velcade, melphalan and prednisone. And each of the 2 treatment regimens will be given for a maximum of 9 cycles. This was piloted at 6-week cycles, so this is, approximately, 12 months of therapy for patients in both arms. And obviously, with the melphalan backbone, this will be for transplant ineligible patients.

I'm also going to tell you about 2 additional front line studies that are likely to activate in the near future. And the first is an ECOG study. And as I said, I think cooperative group studies are a great way to turn gain additional insights into our drug, to think about best ways of delivering Kyprolis in different regimens. So ECOG has a study with 2 primary questions being asked. There is an induction phase, shown by the 2 blue boxes. There's also a maintenance question being asked in the study and that's in the purple bar. In fact, the purple bar, the duration of Revlimid treatment is the primary endpoint of the study and there's a randomization of Revlimid maintenance until progression or Revlimid maintenance for 2 years.

But the other -- the initial question, the induction question is the CRD, or KRD, as I'm now trying to train myself to say, Kyprolis with Revlimid and dexamethasone, KRD versus Velcade, Revlimid, dex. So how would we actually think about how to assess the benefit of KRD or CRD in this induction phase? Well, after 12 cycles or during that time, I think the best assays, the best assessment of benefit, will be recognizable by a response rate. The rate of response, the rate of deep responses, such as very good partial responses or even complete responses; and novel endpoints, such as minimal residual disease. So those comparisons of the depth -- the rapidity and the depth of response will be important endpoints. And then overall survival endpoint, eventually, will tell us about all of these options but predominantly, based on the Revlimid randomization. So once again, another head-to-head study.

Another study that will read out even faster because it will be a smaller study and this will be Onyx sponsored and this study will be starting in the coming months. It's another CHAMPION study. So CHAMPION being a consortium of clinical research centers in the community, interested in asking and answering important questions that can guide physician behavior. So here, the study is looking at another oscillator-based regimen. As you know, some people prefer cytoxan over melphalan, might be a little less toxic to the stem cells. It's a commonly used regimen. In myeloma, it's not registered necessarily with the first-line regimens. It was piloted by Dr. Palumbo, so he's had data at ASH with Kyprolis combined with cytoxan. And we're building on that data here in a U.S.-based study of Kyprolis cytoxan and dexamethasone.

Dr. Palumbo's data suggested that 36 milligrams was the right dosing combination. We'll try it 1 more time and see if we can get up a little bit higher. So we'll do a Phase I escalation. We'll then enroll 200 patients at that -- at that Phase II dose. Again, to get a larger sample size to really assess the safety and efficacy. Another interesting aspect of the study is after 12 cycles, patients will be randomized to Kyprolis maintenance or not. So this would be the very first study of its kind to look at a maintenance question with Kyprolis.

The primary endpoint here will be on response rate, the depth of the response important looking at complete response rates, and again, developing on this novel endpoint of minimal residual disease that you'll hear more about later today.

So with that, I'm going to transition for just a few moments to talk a little bit about Kyprolis' potential in solid tumors. Velcade has done a lot of work. We had some early data, but I think what we see in preclinical models is that there is sensitivity of cell lines of a variety of tumor types and in fact, neuroendocrine tumor cells appear to be a bit more sensitive than epithelial tumor cells. And Dr. Kirk from our Research group will show you this data and talk to that a little bit more, but what I'll say is that the sensitivity appears to be a direct relationship or a direct association with depths of proteasome inhibition. So here again, we want to capitalize on our higher dose, longer infusion, the depth of the proteasome inhibition might be the potential that we need in order to see activity in solid tumors.

We've already looked once. We looked with a small amount of patients early on and this data was actually in the 2010 ASCO. We actually -- some of this is updated with the duration of follow-ups that we now have and in 9 patients with small cell lung cancer, again, a neuroendocrine tumor cell, which was our hypothesis of one place that we might look. We actually see a hint of activity. Now one patient, hard to know exactly what this means, but this patient had actually 6 prior regimens for her small cell lung cancer. And once she started on Kyprolis monotherapy, she achieved a partial response that was durable for 5 years, eventually dying of another cause, of an unrelated pneumonia. We feel as though at this point in time with our 30-minute infusion and higher doses that this is the chance we have to explore the option, explore the potential of Kyprolis in solid tumors. And we think additional investigation at this point of time is warranted.

So here's our first step towards that. We plan to look in the first line setting, a small cell lung cancer in combination with standard first-line chemotherapy. So we'll be initiating a Phase I combination study with the standard chemotherapy agents of carboplatinum and etoposide or VP-16. Once we identified the MTD, if we find safety and tolerability acceptable as we find that we're getting the level of proteasome inhibition that we desire at the doses of Kyprolis that we can deliver in concert with this, will expand this to a Phase II effort.

I'll now turn attention to oprozomib and update you on where we stand today with our Phase I study in hematologic malignancies. So this is the data that was presented at ASH just a few months ago. This shows data from our powder and capsule formulation. We've actually seen interesting and pretty exciting, in my opinion, clinical activity in early stage patients in early stage trials. We saw a 30% response rate in these first 10 patients receiving twice daily, split-dosing, 5 consecutive days delivered every 2 weeks. The MTD was not reached in this dose escalation study and we did see dose-dependent and pretty remarkable proteasome inhibition. What we saw were adverse events that were generally Grade 1 and Grade 2, but really dominated the picture, the safety profile, was the GI-tolerability aspects. So what we've done is we focused our formulation efforts on minimizing the GI toxicity. What we will have at the IMW, that's the International Myeloma Workshop, just a couple of weeks away in Kyoto, will be the first data from this new trial with the new formulation. It's not a new trial. It's just the new formulation as an extension of the current trial. So this new formulation just entered the clinic in November. So we only have small numbers of patients and small short follow-up, but what I can tell you is that we're already escalating to doses above that with once-a-day dosing as compared to the twice daily or split dosing that we saw with the powder and capsule formulation. So this formulation is an extended-release tablet and we're testing 2 schedules at this point in time. One schedule is daily for 5 days every 2 weeks just as we have been doing in the past. And the other is 2 consecutive days every week, more similar to the Kyprolis infusional regimen. So this isn't a randomization, but this just indicates 2 separate regimens that we're testing and will identify -- I think our goal here is to identify, "Is this the final formulation? What is the best dose? And can we see if 1 of these 2 schedules is better?" And once we identify a formulation scheduling dose, then we'll be ready to start some combination Phase I trials and we'll move forward I think, hopefully, fairly rapidly in our progress towards developing all oral regimens for patients.

So in summary, what I've described today is a broad global development program with label-enabling studies across all lines of therapy. And it's a comprehensive study, a strategy as well, I think, in the frontline setting in patients of newly diagnosed multiple myeloma. The 2 head-to-head studies, 1 in newly diagnosed patients, 1 in relapse, will provide the comparative effectiveness data and really help to demonstrate the value of Kyprolis once we showed the superiority over Velcade.

Finally, I touched on a potential new opportunity for us and that might be in new indications outside of myeloma and assessment of oprozomib continues with our new formulation and data that we're looking forward to in just the next couple of weeks.

So at this point, I'd like to turn this over to Dr. Ola Landgren. I'm pleased to introduce Dr. Landgren who has an M.D. Ph.D from Karolinska Institute in Stockholm. He's been a long-term clinical and scientific investigator in the field of hematologic malignancies. He's currently the Senior Investigator at the NCI, where he's the section head for the multiple myeloma section. He's had a long history in the development of prognostic and diagnostic assays. I mean, he's really the leader in the development of the minimal residual disease, or MRD, as the stringent endpoint, stringent measurement of patient response. And he's been actively participating in dialogue with the FDA and others about this endpoint as a potential novel endpoint in clinical trials.

So Dr. Landgren will discuss his experience specific to Kyprolis, including the 2 investigator-initiated trials that he is conducting one in early -- one in newly diagnosed patients and the other in patients with smoldering myeloma. So Dr. Landgren?

Ola Landgren

Thank you very much for that kind introduction, Barb. It's a great pleasure being here. I'm going to present our data that were presented at ASH in December of 2012 from an interim analysis from our investigator-initiated trial using carfilzomib, Revlimid and dexamethasone. I'm also going to add some additional information on future directions on our program.

The way we measure tumor burden in myeloma has been to look for proteins in the blood and the urine for many years. Today, we are more and more focused on flow cytometry-based assays and it's my strong belief that in the future, we're going to have much more focus using molecular assays. And we have a lot of things going on along these lines at our institution, and there a lot of other institutions have worked on this as well. The study I'm talking about today is a combination study using carfilzomib, Revlimid and dexamethasone. It was opened for newly diagnosed patients above the age of 18. The oldest patient currently on the study is 88 years old. It's open for 45 patients. Every patient receives 8 cycles of this combination therapy. For those patients who are potential candidates for transplant in the future, they undergo collection of stem cells after 4 or more cycles. Transplant is not part of this study. The primary objective is to look for Grade 3 or greater neuropathy. And the secondary objectives, as shown on this slide, are to look for a lot of qualitive science. I'm going to share that with you today.

This is our approach to qualitive science: all patients undergo bone marrow biopsies and aspirations, as well as functional imaging, as well as molecular profiling and diagnosis. After 1 dose of carfilzomib, we repeat biopsies and we use those samples for molecular profiling, allowing us to study target effects, as well as molecular downstream effects. At complete remission or after delivery of 8 full cycles, we repeat all these tests again. Patients on Revlimid single drug for 1 year after the 8 combination cycles and then again, after 1 year, we repeat all the assays. So we have full characterization of all the molecular endpoints in parallel with the clinical outcomes. All the bone marrows we do are being processed as shown on this slide. We sort tumor cells, microenvironmental cells, as well as supernatants from the bone marrow. And we use these different compartments to conduct flow cytometry, DNA/RNA profiling. We study target effects on proteasomes. We do PCR assays on DNA and RNA and we have also microenvironmental and biomarker studies as part of this effort. These are the patients that were enrolled at the time of presentation at ASH in December of 2012. At that point, about 28 patients enrolled and 20 of them were part of this planned interim analysis I'm showing you today. As you can see on this slide, the median age was 60. The youngest patient at this time was 42 years old and the oldest at this time was 83 years old. As you also can see in this slide, the cytogenetic and FISH profiles include all the subtypes we typically would see in studies, so it's very representative of the normal population of myeloma patients. The median range of cycles received was 7, the mid ranges between 2 and 15.

These are the results in terms of responses. The black graph shows the drop of M-spike as 2, 4, 6 and 8 cycles. And as you can see, after only 2 cycles, there is a drop of M-spike by 80% to 90%. In fact, 1 patient obtained a molecular complete response already after 2 cycles. On the very top, you see the proportion of patients who obtained a very good partial remission or better in relation to number of patients treated, and you can see that it's a very high proportion of patients.

The next slide, I'll show you the same thing, now in numbers. The number of patients that obtained a near complete response or a stringent complete response at the best response defined as a median of 7 cycles was 75% of these patients. The overall response rate was 95%.

These are the adverse events. The primary objective was to study onset of Grade 3 or higher peripheral neuropathy. None of the 20 patients developed Grade 3 or higher peripheral neuropathy. These are the nonhematologic and hematologic Grade 3 or 4 toxicities that were captured. As you can see, leukopenia was the most common one, but none of these patients developed any infections and we're also seeing that, that's being reversed as patients continue through therapy.

I'm sharing with you biopsies from these patients. On the left, you see, at that time, the oldest patient that was enrolled 83 years old lady. On the right, you see the youngest patient at the time of this presentation, a 42-year-old male. Both these patients had 70% to 80% tumor infiltration of their bone marrows at diagnosis. The lower part of this slide, you see the bone marrows after, on the left, 8 cycles and on the right, after 6 cycles. The left patient was at the, on the left, near complete response and on the right is a stringent complete response. These bone marrows look like completely normal bone marrows by the school book.

Every patient that's being treated on this trial is being worked up with all our qualitive science including our focus on minimum residual disease, which is one of our main areas of research at the NIH in myeloma. We studied 3 to 4 million cells of the bone marrow, which is a very high number. Typically in the United States, institutions could study between 100,000 and sometimes up to 1 million cells with the bone marrow, typically looking for 20 or more cells being abnormal. We routinely always examine 3 to 4 million cells and we also used to cut off of 20 cells. We use an 8-color flow panel, which is a very high number of markers. And if we find 20 or more cells, we would deem that to be MRD-positive. At the time of this presentation, we had evaluated 10 patients that had obtained a clinical complete response or a stringent complete response by current criteria. Therefore, all these patients, we deem those patients to be MRD-negative.

We also used functional imaging. We used FDG-PET/CT for baseline and at the time of complete response. And as shown on this slide, you see an SUV decline, which means the tracer uptake the avidity of the lesions dropping by 50%.

As I mentioned to you, we study target effects and downstream effects of targeting the proteasomes. There are 2 types of proteasomes of relevance, the constitutive and the immunoproteasome, and the primary targets for proteasome inhibitor drugs such as carfilzomib is beta5 and LMP7, that's a part of the constitutive and the immunoproteasome, respectively. This illustrates results from our focus on this particular targets from patient #8 in this series. We did bone marrow for baseline and after 24 hours, as we do for all of our patients, and as you can see on this slide, how the 20s chymotrypsin-like proteasome activity decreased by 80% after 24 hours and 1 single dose of carfilzomib.

We also study the tumor cells' response through the inhibition by studying the mRNA expression in the tumor cells. On the left, you see at diagnosis. On the right, you see after 1 dose, so this is the same sample now looking at the RNA expression. And red means that the -- there's an increased expression. So what you're seeing here is how the tumor cells are trying to respond to the inhibition by producing more proteasomes. I'm not sharing new data today, but I can tell you that we have studied this over time and there is a war going on between inhibition and the tumor cells and over time, we see that drug will win that war.

So in summary, what I've shown you today is that the best response rate at the medium of 7 cycles, near complete response and the stringent complete response is 75%. And the youngest patient was 42 and the oldest was 83 and none of these patients were transplanted. The overall response rate was 95%. I showed you rapid and deep responses with the median time to stringent complete response of 4.5 cycles, with the range of 2 to 7 cycles. Among the first 20 patients that were limited to severe toxicities. Among the 10 patients that obtained a near complete response or a stringent compete response, we assess these with our high-bar flow cytometry, 8-color flow with 3 million to 4 million cells and all these patients were MRD-negative using this assay. I also showed you abnormal mean SUV uptake using PET/CT showing a decline by 49.3% after therapy.

I want to end my presentation by stating that I think with more effective therapies, it's no longer going to be meaningful to use the traditional criteria because most patients seem to go into complete response or very close to that. So we need better markers to assess residual tumor burden beyond this traditional CR rates. That's what we are focusing on. And I'm personally reviewing every single marrow and every single sample for these patients and the results are very, very powerful.

This is my last slide. We have taken this same concept in the setting of smoldering multiple myeloma, which is the precursor state of multiple myeloma. Patients who have smoldering myeloma using current clinical criteria can be divided into low risk, intermediate and high risk. For high-risk smoldering patients, the average time to developing symptomatic multiple myeloma is less than 2 years. So we have taken this concept into high-risk smoldering myeloma and I will present the first interim analysis using this for high-risk smoldering at the IMW meeting in Kyoto in Japan in April, just in a couple of weeks. I'm not going to share you -- the results with you here today because you have to come to Japan if you want to hear that. But I can tell you that the preliminary results were very powerful with deeper and faster responses than I've showed you today for newly diagnosed patients.

Thank you, very much, for your attention.

Barbara Klencke

So thank you, Dr. Landgren. We do, indeed, look forward to that presentation in Kyoto on smoldering myeloma.

This is just an example of the body of evidence that has been generated across multiple investigator-sponsored trials and the influence that studies like this are having on our development program. As you see, as we've moved towards additional studies in the frontline setting, MRD is becoming an assay that we intend to continue to explore in multi-institutional settings. And of course, this data couldn't be more exciting in terms of the depth of response, the dramatic clinical benefit being registered in these patients at this time.

So I'm going to now change topics to talking about the other molecules under development. These are the collaboration compounds that we have: palbociclib, Stivarga and Nexavar. So the first one I want to say a few words about is Pfizer compound and its development is completely and wholly under the auspices of Pfizer. It originated, however, with an Onyx-Pfizer collaboration many years ago. So back, we had a discovery effort initially when Onyx was in its early stages. This is potentially a first-in-class molecule. This is a cycle-independent kinase inhibitor, a CDK 4/6 inhibitor, and there was very spectacular data shown at the recent San Antonio meeting in December. This data, as shown here, this is a randomized Phase II study in hormone sensitive patients and HER-2 negative patients. These patients -- there were 165 patients who enrolled in this study and the PFS hazard ratio was 0.37, with a dramatic improvement in median PFS as well.

So what Pfizer has announced is the initiation of a new Phase III trial in the same patient population with the same regimen. So Letrozole with palbociclib versus Letrozole and placebo. Again, a PFS endpoint is the primary endpoint. And the study is actively accruing. Total sample size will be 450 patients. So we look forward to continuing for the -- for Pfizer to continue the development of this agent.

Regarding Nexavar. I'm going to start again with a breast cancer study, just to stay on the theme of breast cancer for a moment. As Tony mentioned earlier today, this study has just finished its target enrollment of 519 patients. There's a few more patients still in screening, but screening is closed and we look forward to wrapping up total enrollment in the coming weeks. This study is in metastatic and locally advanced breast cancer population as well. These patients are also HER-2-negative, but irrespective of hormonal status. This is a comparison of capecitabine with Nexavar versus capecitabine and placebo. Primary endpoint is progression-free survival. The Phase II data that supported this trial was published by José Baselga. There was a randomized Phase II study predating this, as well, that gave us confidence to move forward into Phase III. And the hazard ratio in that publication was a hazard ratio of 0.57. The median PFSs were 4.1 versus 6.4 months of PFS in this previously treated patient population.

And just to -- final slide on the breast cancer before I move forward, Dr. Helen Torley already showed this. And again, really thinking about the various classifications of breast cancer. HER-2 negative patients receiving hormone therapy, if they're hormone-sensitive. And once patients exhaust hormonal therapy, they, too, almost uniformly go on to receive chemotherapy. So the RESILIENCE patient population are those patients for whom chemotherapy is the next option and palbociclib for patients who have an option of hormone therapy prior to initiating chemotherapy for advanced disease.

Other Nexavar activities. It's been a busy quarter and we announced data at the very first of this year. This trial met its endpoint with progression-free survival being statistically significantly prolonged by the addition of Nexavar. This data will be presented at ASCO in the spring. So this is a study in differentiated thyroid cancer. And for patients in whom surgical options, radiotherapy options and systemic therapy with the radioactive iodine, once that's exhausted, these patients have no further options. So this trial randomized patients to placebo compared to Nexavar. So we look forward to being able to talk more about that data in the near future after ASCO, and we're in the process of working through the NDA applications and the global submissions will follow.

STORM is another study that's ongoing. This is an adjuvant study in liver cancer. It's been ongoing for several years, but has a large sample size. It's fully enrolled at 1,100 patients. This really advances our exploration of the potential of Nexavar to earlier lines of therapy. As you know, Nexavar is the cornerstone of therapy in the first line setting. Many other targeted therapies have tried and failed in this setting, but Nexavar has had a strong clinical benefit recognized in the hepatocellular carcinoma indication. These are patients who have undergone complete resection or total ablation of all of their hepatic lesions after the time of initial diagnosis. And these patients are randomized to either receive up to 4 years of Nexavar or placebo. The primary endpoint is a recurrence-free survival. And data is expected in mid-2014 through the second half of 2014.

There's also 2 adjuvant trials ongoing in the renal carcinoma space under cooperative group sponsorship. So I won't go into those details here. But instead, I'll switch to a brief discussion of Stivarga. Dr. Torley, Helen Torley, showed you this slide. At this point, we're proud to say that the U.S. FDA expeditiously reviewed the 2 applications, granted approvals for both colorectal cancer and GIST. In Europe, the colorectal cancer application is under review. And around the world, there are multiple other applications. In fact, I think Canada just approved it early this week for colorectal cancer.

So in addition to these 2 approvals in the United States, there's 2 additional studies starting in 2013. This development is being conducted by Bayer. And the 2 indications, the first is cytotoxic -- sorry, monotherapy, Stivarga monotherapy treatment for patients with colorectal cancer who have undergone complete resection of all evidence of gross disease. So these are patients who present with liver metastases and are actually able to be rendered free of disease. And so the endpoint of this study is recurrence-free survival. This is a study of Stivarga versus placebo. And it's due to start later in 2013.

Liver cancer is another obvious area for us to explore with Stivarga. There is Phase II data available. And the next study will be a pivotal Phase III in second line hepatocellular carcinoma after receipt of Nexavar. This is also a Stivarga monotherapy versus placebo.

So I think with this, I'll just wrap up before I introduce Bert O'Neil. We have extremely promising Phase II data and an ongoing Phase III trial underway now for palbociclib. We have positive recent results with the DECISION study. We have the RESILIENCE study enrollment completing. And we have adjuvant studies ongoing in renal and hepatocellular carcinoma. With Stivarga, we have 2 recent approvals and additional Phase III trials to begin soon.

So now I'd like to introduce Dr. Bert O'Neil. Bert is a clinical investigator. He has participated in Stivarga trials. In fact, he's leading a large multi-institutional international trial that's an investigator-sponsored trial looking at the combination of Stivarga with chemotherapy. He's an Associate Professor of Medicine in the Division of Hematology/Oncology at the University of North Carolina, where he's been an expert in the treatment of gastrointestinal malignancies. And Bert will present for you the Stivarga data for both -- for both colorectal cancer and in GIST.

Bert O'Neil

Thanks, Barb, and good morning. So I have the pleasure of talking about 2 diseases this morning in 10 minutes, so I'll be brief. The first will be metastatic colon Cancer, where we'll just briefly go through the treatment -- current treatment algorithm and where Stivarga fits in there before discussing the data. And then gastrointestinal stromal tumors, GI folks and sarcoma folks now fight over this tumor because it's really sort of a sarcoma but mostly occurs in the GI tract. And now that there are interesting therapies for it, we all want to study it, so we'll talk about that second.

Stivarga or regorafenib, you can see the structure here is a multi-targeted kinase inhibitor, or some prefer the word "dirty," some "multi-targeted." But what you see on the bottom left is a kinome -- a representation of the kinome, meaning all of the known kinase molecules. It's presented as a tree, so the end of each branch is an individual kinase. And what you can see with the red circles are kinases that are inhibited by Stivarga with larger circles, meaning that particular target is inhibited with higher potency. And basically just by looking at this, you can see there are a lot of big circles. So it has a lot of targets that it inhibits with high potency. Some select targets are in the table on the right, including KIT; the VEGF receptors; PDGFR beta; RET, important for the thyroid cancer we mentioned before; BRAF, important, I think, for colon cancer and other malignancies; FGFR; and then a host of targets after that.

So colorectal cancer is the second leading cancer killer after lung cancer in the United States and in other Western countries. Here you see the distribution of stages at presentation. About 1/4 patients roughly are diagnosed with metastatic colon cancer. And of patients with lower stage disease, especially Stage III, about 25% to 30% will eventually progress on to having metastatic disease. Meaning, nearly half of patients with metastatic -- with colon cancer will eventually have metastatic disease and potentially be treated with Stivarga. Among the patients with metastatic disease, Dr. Klencke mentioned the patients with resectable disease, who will studied in a Bayer-sponsored trial. That tends to be about 10% or maybe a little bit more than 10% of the metastatic colon cancer patients. Those patients can be cured with surgery. So in this case therapy given in addition to surgery is considered adjuvant. On the right side of this diagram, you see the patients with incurable or unresectable disease, where they tend to go through a series of palliative therapies, most of which include chemotherapy. And there we use combinations of chemotherapy and biologic agents, the predominant ones being bevacizumab and cetuximab or panitumumab, depending upon whether the tumor is mutant for KRAS. For a KRAS mutant patient, there are really only 2 available lines of therapy, and that's typically FOLFOX, bevacizumab, followed by FOLFIRI bevacizumab, after which patients would be eligible for therapy with Stivarga. If a patient has KRAS wild-type disease, they have as many as 3 lines of therapy. Generally, all 3 of those, including chemotherapy before they progress on to use of Stivarga.

So the CORRECT study, as many of you know, looked at patients with refractory metastatic colon cancer. Meaning all patients entering this trial had received every available agent: 5-fluorouracil and irinotecan, bevacizumab and an EGFR agent if the tumor was KRAS wild type. These patients were randomized to receive regorafenib plus best supportive care or placebo plus best supportive care in a 2:1 randomization to make the randomization more palatable to patients. This was a global trial, 16 countries, 114 centers with 760 patients randomized in a 10-month period reflecting a very intense need for this therapy. And when I say that, what I mean is if you look at this diagram, in some diseases, patients fall off between first, second and third line fairly dramatically. And colorectal cancer, by the time you get to third or fourth line therapy, you still have somewhere between 50% and 60% of the patients that started out on this pathway fit and eligible for treatment. So it's a very large unmet need in this case.

And here you see the results for the primary endpoint overall survival with a hazard ratio of 0.77, highly statistically significant; median survival difference about 1.4 months, which is similar to what was seen with both bevacizumab and aflibercept in the second line setting, but now you're talking third and fourth line. So this 1.4 months is actually -- really reflects a bigger difference between treatment and not in this situation than what was seen with, say, the bevacizumab trial or the ziv-aflibercept trial. Here you see the progression-free survival with an even better hazard ratio, 0.49 for progression. There is a group of patients who don't appear to benefit which is suggestive of a sub-type effect, meaning there's probably within here a strong subtype that would predict the outcome. At this point, we know that, that is not KRAS or BRAF, and people are still looking at the -- at what the predictors might be. In our second-line trial that we are running, we'll be looking at a very large panel of biomarkers, but that trial is still too early on for me to comment about.

In adverse events, if you look at the Grade 3 column for regorafenib, you see that there are few toxicities that are seen more than 10% of the time. The one that is seen more than 10% of the time is hand-foot skin reaction or a sort of painful inflammation of the palms and soles that occurs. This is a real toxicity, but can be managed pretty readily with interrupting the drug and dose reduction. There are some fatigue, hypertension, diarrhea. Notably the hypertension is less than what you would see with other VEGF drug such as bevacizumab.

So switching gears then to GIST. GIST, again, fall into the categories of being either surgically resectable or not. At this point, if a tumor is surgical resectable, we look at risk and determine whether adjuvant therapy is needed. The only therapy that is currently approved as an adjuvant therapy for GIST is imatinib or Gleevec. For the majority of patients who have non-resectable disease, this disease was previously a major problem. It's essentially completely resistant to standard chemotherapies. When imatinib came along, it was very helpful because the response rates to imatinib are quite high. But essentially all patients will eventually progress on imatinib. Meaning, imatinib does not cure GIST. At which point other therapies are needed. Currently in second line, patients are treated with sunitinib. And then as Dr. Klencke mentioned, regorafenib was just approved as a third line. Here, the data that resulted in that approval, the GRID study. So patients in the GRID study had metastatic or unresectable GIST following failure of at least imatinib and sunitinib. Other drugs have some activity and are used occasionally. Again, the 2:1 randomization between Stivarga and the best supportive care or placebo and best supportive care. In this case, progression-free survival is the primary endpoint because crossover was allowed. And at the end of the day, the majority of patients who were treated with placebo did cross over to active drug and did appear the benefit. So what you see here is a very, very large difference in progression-free survival with the hazard ratio of 0.27, very widely splayed survival curves, median PFS difference 5 months versus 1. Overall survival, not statistically different. It still favors the Stivarga arm, but less so presumably because, as I said before, the majority of patients crossed over if they were initially assigned to placebo and then progressed.

Toxicity profile. Similar to what was seen in the CORRECT study, perhaps with the exception of more Grade 3 hypertension, why that would be is not really clear. Is there some difference in these populations? I'm not sure. Perhaps pretreatment with other agents could have affected this. It's not -- it's really not clear at this point.

So in conclusion then in the CORRECT study, regorafenib increased overall survival versus placebo. This is the first small molecule kinase inhibitor that has been able to achieve this in colorectal cancer. So it's impressive. I think that the degree of benefit given the clinical scenario it was tested is impressive. And this is why we're looking at these in earlier lines of therapy. We think that there's potential for more benefit, perhaps in the future potential to go up against bevacizumab or ziv-aflibercept in one of the earlier lines of therapy. Secondly, in the GRID study, regorafenib significantly increased progression-free survival versus placebo. This, again, was a relatively dramatic effect. And I think this will now have a solid place in the treatment of GI stromal tumors. I think that these data suggest that new Phase III trials, both in these diseases, perhaps moving to earlier lines and other clinical scenarios, such as the liver resection scenario that Dr. Klencke mentioned, and the other diseases seem warranted.

So thank you for your attention.

Barbara Klencke

Thank you, so much, Bert. I think, just to wrap up the clinical section before introducing Chris, it's just remarkable to look across our portfolio and to see drug after drug being able to produce the type of robust activity that you've just seen here with Stivarga. It's rare to see outcome that's better than the palbociclib. And there we see the hazard ratio of 0.26 I think with this. So Stivarga appears to be remarkable drug, able to improve survival in patients for whom none -- haven't had a survival advantage in over a decade with any other new therapy. So we really look forward to continuing these efforts and developing all of our drugs in our portfolio.

With that, I think time to have Dr. Chris Kirk, who heads up our Research group at Onyx, speak to us.

Christopher Kirk

Thank you, Barb, and thank you all for the opportunity to talk to you about some of the exciting work that we're doing in the research department at Onyx Pharmaceuticals. And as way of introduction, the Onyx research team brings nearly a decade's worth of experience in protein folding and degradation. Through that time, we have most certainly established ourselves as leaders in the field of proteasome biology and proteasome inhibitor drug development. This is exemplified by our strong publication record, but more importantly, the advancement of 2 compounds into the clinic for the treatment of multiple myeloma. And right now, I'm going to give you a brief flavor about our research program focused on maximizing the potential of proteasome inhibitor therapy and expanding its use not only within myeloma but outside of myeloma. We accomplished this through a very well-cultivated and carefully selected group of collaborative alliances with both academic institutions, disease-focused research foundations and top-tier contract research organizations.

So let me turn my -- your attention to the chemistry, which we believe is the foundation of everything we do in the research group at Onyx. Our mantra within the lab is better living through chemistry. And we believe that peptide epoxyketone represent the best proteasome inhibitor platform out there, and for 2 very important reasons. First, they're highly selective for the proteasome active sites subunits. They have minimal off-target activity. And in fact, no major off-targets have been identified for either carfilzomib or oprozomib.

Secondly and equally importantly, they are irreversible inhibitors of the proteasome, which also distinguishes them from other classes of agents currently in the clinic. This irreversible inhibition means that the duration of target inhibition is tied to the turnover of the target not to the pharmacokinetic properties of the drug. This makes peptide epoxy ketones the optimal tool for studying proteasome biology in the lab. And we believe, and I'm going to show you the optimal tool -- optimal drugs to deliver high levels of targeted inhibition in vivo.

So our research has been focused on going after and optimizing the delivery of both carfilzomib and oprozomib. We also have a robust program, which I'll finish up on, to understand and determine if there are biomarkers that predict full response or resistance, and finally work to understand which of the best partners to combine with proteasome inhibition.

So the other mantra we have in the lab is that more is better. And here is a great example of more being better. This is data showing the maximum proteasome inhibition achieved in patients with carfilzomib and oprozomib in comparison to published data with the peptide boronate. What you'll notice is that both carfilzomib and oprozomib achieved greater than 80% proteasome inhibition. And in the case of a high-dose of carfilzomib at 56 mgs per meter squared, we are approaching the limit of detection of our assay as shown by the dotted horizontal line. This means that we're achieving nearly complete target inhibition at a 56 mgs per meter square dose. This is in contrast to the approximately 65% inhibition established for the peptide boronate.

Why is this important? Well, because work by us in the lab as well a host of other academic investigators has determined that in order to kill a tumor cell, it is important not only for the depth of target inhibition but the duration that is occurring, and that this is tumor-type specific. So B-cell neoplasms, like multiple myeloma and some forms of non-Hodgkin's lymphoma, are susceptible to the level of inhibition achieved with the peptide boronate, and this provides clinical benefit. But what I've just shown you is that Kyprolis can achieve even higher levels of proteasome inhibition as can oprozomib, and this may bring into potential treatment other tumor types. In particular, solid tumor types of the neuroendocrine subtype, which are, like myeloma, high-protein producing factories, thus explaining our interest in exploring and following up on the early encouraging signal in small cell lung cancer. What we have decided to do in the lab is to take the learnings we have from oprozomib, namely that dose-intensive schedules resulting in long-term duration of proteasome inhibition can be well tolerated, and to determine if we can further maximize this. So one initial effort is to create encapsulated versions of carfilzomib that maximize that level of inhibition.

So what data we presented at the most recent American Association of Pharmaceutical Scientists showed that encapsulated carfilzomib did, indeed, prolong the exposure of free drug. What I'm showing you here on the left are blood levels of carfilzomib, either delivered in current clinical drug product in orange or in test-encapsulated version, the same dose administered to mice. And what you can see is more than tenfold the amount of drug in the plasma 1 hour after dosing in the encapsulated delivery system. This resulted in prolonged proteasome inhibition in tissues in these animals. And again, getting back to that mantra of more being better, we think that this might have several opportunities, including less frequent dose administration and activity in resistant populations, including tumor types such as epithelial-derived solid tumors.

So finally, I want to point out a rather unique position that Onyx is in. I've told you about our drugs, which are highly selective, optimal tools delivering high levels of proteasome inhibition. Dr. Landgren showed you similar data from his trial showing proteasome inhibition and the molecular sequelae that occur in his patients following carfilzomib administration. We happen to have, from our single-agent trials, highly purified tumor cell populations just at a time when the next-generation sequencing advances have made whole genome and whole exome sequencing, rapid and cost affordable.

So what we are doing is taking those patient samples, doing both genomic and transcriptomic profiling. In parallel in the lab, we're taking tumor cell lines, both myeloma and solid tumor cell lines, utilizing advancements in proteomic profiling to understand the global protein changes that occur upon proteasome inhibition, comparing that to expression profiling. And comparing that to synergy screens to look for optimal partners to combine with carfilzomib in tumor cells, the ultimate goal finding biomarkers that explain and predict for response, understanding the molecular sequelae that make up the resistance to proteasome inhibition in patients ultimately leading to the discovery of new drug targets.

So with that, I will turn it back over to Tony, so that we can start some question and answers, and I thank you, very much, for your attention.

N. Anthony Coles

Well, thank you, Chris, and thank you to all of our speakers for this morning. Hopefully, you have a much better appreciation for both the depth of expertise, the breadth of the work, and the exciting advances that are happening at Onyx. We have the opportunity to grow our business here in the United States, to expand the opportunities internationally and outside United States and really to leverage this great pipeline and this great portfolio that we have spent time building.

Before we take question, and I'm anxious to do that this morning, I want to do 2 things. One, I would like to introduce one other member of the management team, who is also joining us today, it's Ms. Kaye Foster-Cheek. So, Kaye, if you'd stand up. Kaye is our head of global human resources, and she is a nationally recognized expert in human resources. Prior to joining Onyx, ran global human resources for Johnson & Johnson. So we're really quite fortunate to have Kaye as part of the management team.

I'm also going to ask the members of the management team who spoke today, Chris, Helen, Barb, to join me here on the podium. And as they're making their way, if you could start organizing your questions, and we'll be prepared to take them momentarily.

Question-and-Answer Session

N. Anthony Coles

Okay, who's first? I can't read the name cards, so if I don't call you by your first name, please don't be offended. We will get to everybody. We're going to go back and forth on each side of the room. So we'll start with Mike.

Unknown Attendee

[indiscernible]

N. Anthony Coles

Let's wait for the mic, too, since we're webcast.

[Technical Difficulty]

Unknown Attendee

So I just wanted to ask about CLARION. and I guess it's a little surprising to study design using melphalan. I want to ask you to help us understand how you think that helps you in the U.S. since melphalan-based regimens are fairly uncommon in the U.S. And why something like that versus -- I know Revlimid is not approved yet but, I mean, that's de facto standard in the U.S. and why not a Revlimid-based comparison versus melphalan-based comparison?

N. Anthony Coles

So let me provide some context, and I'll ask Barb to make some comments. You guys know this already, but keep in mind that in this particular disease and the management of this disease, there's a transplant ineligible population and a transplant eligible population. The recent NCCN Guidelines speak specifically to the transparent eligible population, where KRD is the recommendation of this independent body of physicians. This is our strategy for the transplant ineligible population of patients, which is 60% of the cases compared to 40% of the transplant eligible. I think given the breadth of work that we have with ISTs and other studies and the great data that we have with that particular combination, we now want to take a step back and assess what we want to do with the transplant eligible population and derive the best strategy for addressing that particular group. But that's a really important point that I don't want anyone to miss today. Barb, would you add anything to that?

Barbara Klencke

I think just to emphasize what Tony has said, this is a disease of older individuals. I think the median age of diagnosis is a bit over 60, and one sees high numbers of patients in their 70s and older. So as Tony said, 60% of the population is transplant ineligible just based on age and other comorbidities at the time of diagnosis. I'm really thinking about the global strategy as well. And as Tony said, the trans -- the NCCN Guidelines just being updated last week with KRD as one of the options, one of the other options now to consider for transplant eligible patients, where sometimes the trials are a little more confounded when you introduce induction therapy followed by transplant. But as we see more and more patients actually deferring transplants, electing to undergo collection of stem cells, but as therapies really get better and better, deferring transplants becoming so common that, as Tony said, what else can we do in that patient population. And that's where we think about some of the other things such as the ECOG study such as -- looking at CRD, even the cytoxan-based U.S. study. Cytoxan is a little less stem cell toxic and is an option for patients. So it's a consortium maybe or a suite of studies that eventually will provide the body of evidence, so that all patients have choices.

N. Anthony Coles

Good. We'll go to this side. Geoff?

Geoffrey C. Porges - Sanford C. Bernstein & Co., LLC., Research Division

So a general question. A lot of specifics and great information in the presentations, but you started out by talking about sort of expanding the company collaborations and potentially bringing in assets. And I think most of us in the room were a little jaded. We hear that strategy from a lot of different pharma and biotech companies. What do you think the differentiating capabilities of Onyx that is going to enable you to be more successful in making those external incremental investments than the many competitors who are targeting the same things?

N. Anthony Coles

I think without the proof point for the Proteolix acquisition, I think it'd be a tougher question to answer. We don't have perfect judgment or insight. We won't get it right every time. We'll screw some stuff up. But I will tell you that our track record in this area of identifying assets that not only are good compounds, as I said about Kyprolis, but great compounds, is pretty good. But most important thing is how we structure these transactions. If we structure them so that the risk is reduced and we pay preferentially for higher valued assets, that's a great win-win for both the company and for shareholders. And that's an approach that we'll continue to take. The other thing I'd draw your attention to is the quality of the corporate development team. We call it the search and evaluation of the search and development team. The team was built by Yergin specifically to have deep expertise, both scientific and a clinical expertise, to ensure that when we did make a selection, we took into consideration both the competitive environment and the available validating information for similar mechanism opportunities. It's a high-quality science group. And despite the fact that we've got a very focused discovery group, we've complimented our internal focused discovery effort with this external SEARCH approach, and there's deep expertise in complementary across the 2. So I'll underscore again. We're going to screw some stuff up, but -- and we're not going to always make the right decision, but it won't be for the expertise and the trying to really get this right. And I think, again, Proteolix it's a great example of what we can do when we apply our efforts. I will go in this side. Gene?

Unknown Attendee

I had a question on ASPIRE and then just a real quick question on smoldering. If you look at the bulk of the enrollment for the ASPIRE trial, it appears that it occurred pretty much in the last 10 months between April and February -- April of 2011, February 2012. Patients are going to be given 18 cycles or up to 18 cycles, and the data endpoint appears to be about 2 years post that bulk enrollment time period. And I'm just wondering, what's your expectation for PFS in terms of how definitive the data will be at that point. And then is there an opportunity to see overall survival by that point given what you can say about the trial at this point? And then just on smoldering myeloma. I'm just wondering what sort of data would push the NCCN to maybe make a guideline in terms of treatment? Would it be a response rate data? Probably not. Delay to transformation to myeloma maybe? Can you just comment on that?

N. Anthony Coles

Okay, so I hear 2 questions in that. One, about the ASPIRE study, that I'll ask Barb to take. And, Dr. Landgren, if you could make just a brief comment, again, without revealing the data on smoldering myeloma. The question really is about the NCCN Guidelines and what the criteria might be for them to consider that. There won't be much to comment on there, but I think Dr. Landgren can provide some color. So, Barb, the ASPIRE question; and then Dr. Landgren.

Barbara Klencke

So the ASPIRE question. As most of you have known, we looked at designing the study fairly similar to some of the prior Revlimid publications. Of course, many years have past -- several years, anyway. Weber and Demopoulos has papers on Rev/dex. The field has evolved -- evolved a little bit such that patients now who have relapsed disease are probably receiving more commonly bortezomib prior to enrollment into the ASPIRE trial and possibly getting more IMiD therapy prior to coming into the trial. So nothing necessarily tells us to expect the control arm to necessarily do dramatically better than what we had predicted. But we're just speculating. I think the time lines have moved up. It's a fact that we are seeing fewer progression events as compared to the original projection, given the time that has elapsed since the end of enrollment. And I don't know the exact months of -- but we did have an enrollment curve that was a little flat on the front end and much steeper enrollment curve in the back half of the study. So you -- that is true. I think we have updated our time lines to say that the interim analysis is coming in later than originally projected. It's been stable, though, as we've looked at it subsequently. I think the only other thing you asked -- the one other thing you did ask about was overall survival. And if we pass the interim, then absolutely, we would be looking at overall survival at that point. And of course, it's got less power at that earlier time point. So we'll have to see what the data show at the time of the analysis.

N. Anthony Coles

But it is a secondary endpoint, so we'll be tracking it very carefully. Ola?

Ola Landgren

So you asked the question what would be the endpoint for the FDA to approve a drug for the indication of smoldering myeloma. That's, obviously, a very difficult question. I don't think I know the true answer. I don't think anyone knows. I would think that it probably -- it has to be something that's going to be developed between the FDA clinicians and pharma companies. I think that probably time to progression could be one. There are data from Spain that has been presented at ASH using Revlimid/dexamethasone versus placebo, and I think they have a follow-up of about 4 to 5 years. It was presented this past ASH showing a overall survival benefit by early treatment. In that very same study, I think it was after around 9 or so cycles of therapy, only 20 or so patients -- 20% of the patients obtained a complete response. In our study -- I told you I'm not going to give you the results unless you come to Japan, but it's better than what I showed you today. And today, I showed you 75% for myeloma. So if you do a little bit math back and forth, if you have so much better responses, probably the overall survival is not going to be worse. I could envision that the minimal residual disease markers are going to play a very, very important role as proxy markers. So I think a key thing for myeloma drug development is going to be to develop minimal residual disease proxy markers and corollate them with overall survival and then we can use them to get drugs quicker out to patients in the future. I think that's going to be something of primary -- that's a primary area of investigation, in my opinion.

N. Anthony Coles

Thank you, Ola. Rachel.

Rachel L. McMinn - BofA Merrill Lynch, Research Division

I have 3 questions -- yes, I have 3 questions. One specifically on CLARION. Can you help us understand why you have the same duration for Kyprolis. Okay, I would've thought they've given a better high tolerability, you can take advantage and actually have more cycles, some sort of maintenance arm built into that. I wanted to ask about the heart failure rates in both the NIH study and the MD Anderson. There were 2 events in the NIH study and one in the MD Anderson study. So maybe, Dr. Landgren, you can help us understand, are these -- just how to put these events into context and whether this is something that would be differentiated from Velcade. And then, finally, just, you've emphasized minimal residual disease a couple of times. What data do we have to understand that this is a better marker than CRs that's going to be correlated with PSF?

N. Anthony Coles

All right. Ola, since you've got the microphone, let's start with you on the last 2 question for the question around adverse events and then the second one.

Ola Landgren

So can you please repeat which events you were commenting on that? I missed that.

Rachel L. McMinn - BofA Merrill Lynch, Research Division

[indiscernible]

N. Anthony Coles

We'll need a microphone, I'm sorry. I hate to do this, guys, but we've got to be disciplined for the webcast.

Rachel L. McMinn - BofA Merrill Lynch, Research Division

Sorry. There were 2 heart failure events, I think, that were noted on your slide that you had also presented. And then in MD Anderson study that Barb mentioned, there was one heart failure. And there's been some discussion in the -- amongst thought leaders about CHF, and I just wanted to better understand how to think about those events. They're relatively small studies, it's in a newly diagnosed population and I don't know that we would've seen those events with Velcade.

Ola Landgren

So when it comes to cardiac events, you're correct. I think there were 2 or 3 patients at this interim analysis that were reported to have that. Our program, we have around 300 patients on clinical trials. We know in myeloma that cardiac disease is prevalent. The average age alone set for myeloma is 70 years, so a lot of 70-year-old people have that. The 3 patients that had it on this particular trial had a short transient episode of shortness of breath. And we work all our patients up extremely carefully because they are on our trials. So we did ECHOs, we also did investigation of lung and everything, including labs, et cetera. So none of those patients were able to visualize anything that was objective to be adverse, neither in lung or in cardiac tissue. For all those 3 patients, the symptoms went away within 24 hours, never came back. And all those 3 patients continued on the trial with the same dosing. And all those 3 patients are in stringent complete remission with MRD negativity. I do not know what the actual underlying biological cause of the symptoms were, but they had a short period of these symptoms, the shortness of breath. I cannot give you any more information. I'm happy to share all my raw data. We have done extensive workup.

N. Anthony Coles

So Ola, just stop before you answer the second part of the question. Let me put my cardiologist hat on and distinguish, if we can, the difference between shortness of breath and congestive heart failure. Shortness of breath is a symptom of a variety of ideologies. Congestive heart failure is a syndrome that's specific and referable to the way that the heart pumps blood. So we shouldn't mix the 2, if you will. Yes indeed, in the NIH study, there were patients, as you described to, had shortness of breath and dyspnea, the medical term for it. But that doesn't necessarily portend or define congestive heart failure when you distinguish those 2. I think your comment and your observation about the coincidence of cardiovascular morbidity in this population is well understood and underscored. So it's really hard to say, Rachel, until we do the randomized comparison studies, to determine whether this is a rate in excess of what we'd observed in this particular population with other treatments. So let's not defer to that specific question, but I just underscored CHF and the shortness of breath as 2 different things. Can you take the second question about MRD? And then, Barb, we'll come to you on the other question.

Ola Landgren

So can you, please -- sorry, could you please repeat the exact question so I can answer it correctly.

Rachel L. McMinn - BofA Merrill Lynch, Research Division

Just wondering how MRD -- what data we have to show that MRD is correlated with PFS, or is it a better marker than complete response?

Ola Landgren

So there are studies from Spain showing that the depth of the response after a conventional chemotherapy followed by autologous stem cell transplant. So if you go into PR, you go to VDPR [ph] or you go into CR, that matters both in terms of PFS and overall survival. There are also studies from the Spanish group published in the Vladjan [ph] in the last year where this -- the investigated people who obtained a complete response and they used the same 8-color flow I talked about today. And they showed that within the compartment of patients that obtained a response, either MRD positive or negative, again, there is a PFS and overall survival difference in the setting of conventional therapy followed by high-dose melphalan. The proportion of patients that have residual disease, detectable after conventional therapy, I probably think if I was given 100 patients treated with conventional therapy followed by high-dose melphalan, I will probably be able to find disease in 90s or 95% of patients. I showed you today that out of those patients that are worked up, in 10 out of 10, they were MRD-negative. So I think what we will -- a key question, again, is to try to keep on pushing the bar and to do molecular assays to see how deep we really can go and see if there is any residual disease. And that's what we are working on right now.

N. Anthony Coles

And the CLARION question, Barb?

Barbara Klencke

Yes. The question was, on CLARION, why is the duration of therapy in both treatment arms limited to just 9 cycles or, approximately, 12 months? Well, I think in the first-line setting, patients these days do rather well. And so, if we were to continue therapy to progression, you've got patients on therapy for sometimes a fairly extended period of time, the FDA has been very clear with us and others that in order to do studies that look at treatment to progression, that the study needs to be designed in order to understand the independent contribution of upfront therapy versus the maintenance therapy. And so you're talking about 3-arm, 4-arm trials on much larger and longer duration. We really hope long term that an oral regimen such as oprozomib, a longer-acting drug such as a liposomal formulation, might be ideal for the maintenance setting. With Kyprolis, patients coming in twice every week. I think we chose not to do a 3- or 4-arm study that would take us an additional length of time to get the answer of how Kyprolis compares to Velcade. So I think that's the thing. But I think also it's interesting that in VISTA, the Velcade is given twice a week for the first 4 cycles, but then it drops to once a week. So the number of doses that will be given to any one patient, even if they stay on Velcade on a VMP arm all the way to the end, is about 40% fewer doses of Velcade than the patients who will be getting Kyprolis on that carfilzomib arm. So I think we'll see a difference in dose intensity over the course of the study even if patients don't drop off for toxicity. And so when you add to that some assumption of a slightly higher rate of discontinuation, if neuropathy continues to be a problem, then I think we will see -- we expect to see some advantage of a higher dose intensity from Kyprolis arm.

N. Anthony Coles

All right. Matt [ph]?

Unknown Analyst

First question is on dose escalation as seen in ENDEAVOR and some other studies. We've heard some questions raised about the risk of finding more safety events as you escalate the dose. We understand you're trying to improve the ability to deliver a clinical response here, but I was wondering if you can get us more comfortable with the risks around that. And maybe related, talk about whether or not there are dose deescalation protocols, including in case you've run into troubles just to bring it back down, but still giving some patients the opportunity to see the higher exposure, if they can tolerate it, and then...

N. Anthony Coles

Okay. So is there a second one?

Unknown Analyst

Yes, that --

N. Anthony Coles

Let's answer that one because I think if we stack them, we'll lose track. So let's just do that and we'll get to everybody. I promise. We've got plenty of time. Barb, can you clarify something Matt [ph] said about the correlation between the MTD and the DLTs for Kyprolis, as observed. I just want to get that fact out there so there's no misunderstanding about what that looked like. And at what doses we saw it. That's really critical in the answer to your question.

Barbara Klencke

So we dose escalated the 30-minute infusion and we did go above 56 at 70 milligrams per meter squared. In myeloma patients, we saw a case of renal failure and maybe one of dyspnea, I believe. So 56 is the MTD at that 30-minute infusion. So there's 2 questions. Will we see a different safety profile or concerning safety profile at 56? And that's one of the questions of the study. We have presented data on approximately 48 patients. We had about 2 dozen patients in ASH 2011 and then another subsequent 2 dozen patients or so in 2012. And the vast majority of patients were able to stay on therapy for multiple cycles. We had very low rates of treatment discontinuation and low rates of dose de-escalation. We saw a slightly different profile, hypertension was a little higher than we had seen before. Other things, dyspnea was actually a little less. So we have not been able to discern on the patients that we've seen to-date any major concern. And of course, we have a data monitoring committee and internally we constantly monitor the data in aggregate across the 2 arms in our ongoing trials. On an individual patient basis, you ask, "Can patients de-escalate the dose?" And they can. They would go to 45 milligrams per meter squared if they had an adverse event that was thought to be related to the 56-milligram dose.

N. Anthony Coles

Good. Thanks, Barbara. I just wanted to get the point out about 56, which looks pretty good from an AE point of view. Second question, then we'll move on and then come back if there are others.

Unknown Analyst

Sure, and I appreciate you clarifying that because the reason we asked is just it was a question raised by some experts that we've spoken with. So appreciate the clarification on that. The second question is what you perceive, this for the company and then maybe if we can get Dr. Landgren's commentary on this as well.

N. Anthony Coles

Matt [ph], I'm sorry. Can -- in the control room, can we turn the volume up on this mic? It is a little bit hard to hear. And I think he's saying, hold it a little bit closer.

Unknown Analyst

Hold it closer, okay. So the question is on the oil -- oral proteasome inhibitor development. I'd appreciate the company's perspective on this, but also if I could understand Dr. Landgren's perspective on what you would need to see to adopt oral proteasomes. The question is, what is really the bar for advancement? Do you need to have comparable CR rates in safety to say, a Kyprolis, which in our view is sort of set the bar pretty high, or because of the oral administration, are you willing to take a step down a little bit on response rates? And Dr. Landgren, how would you approach that from a treatment perspective? How important is the oral administration versus the sort of high bars and complete response rates that we've seen with Kyprolis?

N. Anthony Coles

So let's do this because I think that there are some context that Helen could provide in terms of how physicians make the choice, which would be relevant from the prescription point of view, and then I think either between Barb and Ola, we can have some scientific commentary. Helen?

Helen I. Torley

It's an excellent question because when we ask physicians how they make their choice of therapy, the first and foremost always comes efficacy, then comes risk benefit. I think the question with oral therapies is, exactly as you say, will their physicians take a small reduction in efficacy for the presumed improvement and convenience for patients? I would say, based on the research we've done so far, but we're continuing to research it, efficacy is king. They want to see the efficacy of the product. But we are still researching that to understand the exact profile. And, perhaps, Dr. Landgren, you can talk about how you're looking at the oral proteasome inhibitors at this time?

Ola Landgren

I agree. Of course, that it's a balance between the effect and the convenience. I think -- I have a lot of patients in their 40s in my clinic. A lot of people come to me, I tell them -- they ask, "Tell me about your results." I show them the results. And then they say, "Tell me about your side effects." And I show the side effects. And then I say, "There's one more side effect. You have to come and see me a lot. So you get to know me a lot." So they say, "I think of this as an investment because I'm planning on living for many years." So I think it very much depends on what patients we are talking about. Because a young person, who are planning for living for many years, having a family and working -- a lot of my patients work, actually, full-time. I think those patients would not trade the drug that is more convenient for efficacy. They would just never do that. But there are a lot of older patients and there are patients that may not be able to travel so much. So I think it's good to have all these options. And also another thing is that myeloma is not one disease, as most of you in this room know. It looks the same under the microscope, but it's actually a completely different diseases across patients. There are probably at least 10 or more different molecular subtypes. And I think if you have the more indolent subtypes, maybe an oral drug could control the disease for very many years and you could have the more aggressive ones, it's probably not. So the way I view it in my clinic, I think for younger people with more aggressive disease, that in my opinion, the more powerful drugs are definitely having a place. And I think on the oral drugs, as a tail to control the disease and maybe get rid of the minimal residual disease as a second step there. And for patients who are in the other category, maybe you could consider the other one. Now it has to be discussed with the patient. We don't know, really, the answer, but that's how I approach this.

N. Anthony Coles

Okay. Great. Thank you. We'll go to this side of the room.

Ola Landgren

Can I add one -- can I add one more detail? I forgot to say before.

N. Anthony Coles

Sure.

Ola Landgren

So the longer lines of MRD, someone asked before, actually one thing I want to add to that, that's very, very important. This is super important. The word "MRD" is a word that people throw out, including myself, all the time. There is no book about what MRD is. So we have to be very, very, very cautious. So when I say MRD, I talk about using a 8-color flow cytometry and I review 4 million cells. And very many centers in this country, including prime academic centers, would evaluate maybe 100,000 cells in the bone marrow and they may use 6 or 4 or 8 colors. So if you evaluate 100,000 cells and you find 20 abnormal; if you evaluate 4 million cells and you find 20 abnormal, that's a whole different game. So when we talk about designing studies using MRD as an endpoint, we need to have a standard for MRD. This is a key question in order to advance the field of MRD in any disease area. For myeloma, this is completely wide open.

N. Anthony Coles

Good. Thank you. Terence?

Terence C. Flynn - Goldman Sachs Group Inc., Research Division

I just have 2 quick questions. So the first one, you talked a lot about Onyx as a top line growth story evolving into a period of deals here now. Just was wondering, can you help us think about the bottom line and longer term how you guys are thinking about that? We get that question a lot from people. And maybe are there any revenue inputs that you're waiting on as you contemplate kind of deal structure or size here going forward. And then just a question for Dr. Landgren. Have you done any work with Velcade with respect to MRD? I was wondering if there are any differences versus Kyprolis in terms of what you see.

N. Anthony Coles

Okay. I'm going to take -- let me make sure I understand the revenue input question. Clarify that just a little bit for me, Terence. Revenue inputs in terms of deal structure and size. Meaning, kind of a threshold for revenue?

Terence C. Flynn - Goldman Sachs Group Inc., Research Division

Yes, or in terms of Kyprolis sales levels you're looking at, or maybe trial readouts that will produce other revenue inputs. So anything that's gating to do...

N. Anthony Coles

Oh, I see. Okay. Well, I can take that one first. And the answer is, no. We will investigate each potential licensing or acquisition opportunity on its own merits. So we really do our best estimate of what the future potential top line revenue is as driven by the unmet need and we size the deal and set the terms as appropriate for that opportunity. I think that, that can proceed independent of Kyprolis performance in the marketplace. Because one of the things we know is that, if you're going to build a great company, you've got to have a broad pipeline. And we've got a great portfolio, but we'd like to make it even better. In terms of profitably, I'll make a quick comment and then maybe ask Matt to provide a perspective there. And I think we so deeply believe in the proteasome inhibitors that we have, that I can't think of a better place to spend an incremental dollar than behind a therapy that's proven, not only to be biological active, but to have enormous potential in this area. So we think it's worth the investment. But a little more color, Matt?

Matthew K. Fust

I think the -- does this mic work? So I think the -- the only thing I'd add to Tony's comments is I often find it helpful to think about breaking down the business a bit by products since the revenue and earning streams differ dramatically across our products. Products like Stivarga is, obviously, quite easy with 100% margin on top line, Stivarga sales, globally in oncology. I think the error bars get a bit wider and the uncertainty event higher as we move to the proteasome inhibitor franchise. As you heard today, we obviously have to look at the growth trajectory now globally with the first sales of Kyprolis beginning x U.S. in terms of driving top line sales, looking at commercial investment in particular behind and just patient launches in Europe and other geographies. And as you heard today, following the science in terms of both the Kyprolis and the oprozomib development programs. So it's tougher to really take a multi-year view until we have a stronger sense of the way that the development programs play out in the proteasome inhibitor franchise in particular.

N. Anthony Coles

Good. Thanks, Matt. This side of the room, let's see. You're on. There's a question for Ola. This is the second part. Okay. Thank you. Hang on, we'll get right to you.

Ola Landgren

So you asked me the question whether we have investigated Velcade as well. So I have not done any randomized studies comparing carfilzomib versus Velcade in the setting of MRD. So that I don't have. So my experience with MRD, the way I defined it with 4 million bone marrow cells being evaluated with 8-color flow looking for 20 or more cells. We have actually done it across any type of therapy that has been used at our institution and on the outside when patients come for second opinions. There are patients treated with other therapies where you can see MRD, negative results. But in my experience, there is nothing that is as consistent as the therapy we are using. For the most part, in patients treated with any FDA-approved indication followed by a high dose melphalan, we can always find residual cells the way that we define it. So there is definitely a difference. And I can say that I have reviewed every single sample myself together with the pathology and the floor lab. So I know that for a fact. But I don't have any randomized data to back that up.

N. Anthony Coles

Okay. Thank you. All right, Ron [ph]?

Unknown Analyst

So I have 2 questions. One, just on -- give us a little bit of an update, Pomalyst with Kyprolis combination studies, when are you expecting more data? And then secondly, what are you seeing in terms of reimbursements sort of in the second life for Kyprolis? Are you seeing any combination with Revlimid right now?

N. Anthony Coles

Okay. Helen, we'll ask you to take the second one, the reimbursement question. And then Barb, are there any amplification on Pomalyst and Kyprolis data?

Barbara Klencke

Nothing coming anytime soon. There are additional studies that are just in the early phases have been approved, soon to be activated. But we don't have any expectation for data, additional data, this year.

Unknown Analyst

And the dose of Kyprolis that is currently thought to be used in combination with Pomalyst?

Barbara Klencke

Yes. So the dose that was tested and presented by Dr. Shah at ASH, they started the dose escalation and stepped up to Pomalyst at 4 milligrams first. So when they moved up on the Kyprolis, they got to 20, 27. The dose-limiting toxicities in that study were hematologic. So at least in conversations I've had with other investigators and with Dr. Shah himself is the supposition of what kind of Kyprolis dose would be able to be given in combination with only 2 milligrams of Pomalyst. And that's an unanswered question. We've not seen a study done of that sort. But that was one of the driving factors behind the desire to do additional Pomalyst, Kyprolis studies.

N. Anthony Coles

And the reimbursement question?

Helen I. Torley

Yes. What I can say is in the second-line, we very rarely see Kyprolis being used in combination with Revlimid, it's less than 5%. And I actually don't have any information on if those physicians are being reimbursed if they are using it.

N. Anthony Coles

But reimbursement to-date, as I think you pointed out in your presentation, has been quite good. So where physicians have chosen to use, it's been reimbursed without any difficulty. Okay. So this side of the room, and we'll go to Marshall.

Marshall Urist - Morgan Stanley, Research Division

Great. So a couple of things for me. Just first, from Helen, obviously, you guys can't promote, do it directly or anything like that, but maybe your thoughts on the dynamics in the myeloma market with the NCCN update. Just your broad thoughts on the sort of percentage of the prescriber base that might be responsive to that, how broad do you think that is? Maybe just some sense of what you've seen so far. And then second just for Barb on weekly dosing. I just wanted to get a sense of kind of how you see that playing out across the sort of number of different settings and doses and combinations with the 2-day dosing and kind of what is the bar, is it just PD data, kind of what's the right way to think about how that sort of filters out across the various settings?

N. Anthony Coles

Okay. Helen?

Helen I. Torley

On the NCCN guideline, I think you said that in your first statement, I really am not in a position to comment on that. Our role is to promote our own label. So I really can't speculate on how physicians may react to that.

Barbara Klencke

And then in terms of your question about weekly and where I might see the best use of that data, where that might play out. And again, it's hard to say. I think that, and Helen may want to comment, whether we're seeing in the marketplace already, people occasionally using weekly dosing off label, which is why we thought it was important to really understand the right dose and understand the safety and efficacy a little bit better. I would guess that in monotherapy situations is where I might imagine seeing it, mainly because this study itself is a monotherapy study. It will identify a dosing schedule that's tolerable as a monotherapy. And I think additional studies would be needed if one were to move to attempt a monotherapy in combination with other regimens. So all of our pivotal trials, FOCUSES, FIRE, ENDEAVOR and CLARION, are twice a week. And we have no intention of changing any of our pivotal trial from the consecutive-day dosing strategy.

N. Anthony Coles

All right. This side, Robyn?

Robyn Karnauskas - Deutsche Bank AG, Research Division

Great. So 2 quick questions on oprozomib. So how are you thinking about the regulatory path? If you have Phase I data this year, how do you think about quickly moving that forward versus taking time to do additional more dosing work? And then second, since CLARION will be ongoing, how do you think about trials with oprozomib when you're first-line study will be ongoing with Kyprolis. Do you think about it as a maintenance or sort of a similar strategy?

Barbara Klencke

So I think it's still too early to know exactly what our Phase III strategy will be. I think an important question will be, eventually, will we be able to move from Phase I to Phase III? All we know is that right now, our desire is to identify, is this the right formulation, what is the best schedule, what's the maximum dose at that schedule? Once we have that for monotherapy, we would then initiate combination Phase I studies. We are lucky in the sense that oprozomib is already showing proteasome inhibition and single-agent activity which means that we actually will have some data upon which to base some future plans on the basis of Phase I or expansion on Phase I. But with that, we really have to nail our -- the answers to the question in Phase I before we talk about -- before we really make decisions about where we'll go next.

N. Anthony Coles

And then there's a question about CLARION ongoing, and how we might think about oprozomib as a follow-on to Kyprolis.

Barbara Klencke

That's right. I think if -- there is so much enthusiasm around the clinical trials that we have conducted that, even though we started out with slow enrollment in our early trials, I think now people know and are enthusiastic about the Onyx-sponsored pivotal trials. If we were to be lucky enough to be able to activate a Phase III trial with oprozomib at the same time that CLARION is still enrolling, I think we could manage that. Hard to say when that'll happen. And also whether oprozomib would be integrated into the same type of regimen, whether it would be integrated into maintenance or both, I think at this point, we don't really know.

N. Anthony Coles

Okay. Good. This side of the room? Yes.

Unknown Analyst

I just have 3 question about CLARION. The first is, I wondered if you could comment a little bit on the choice of using a combination regimen with carfilzomib at all rather than simply high-dose carfilzomib in that trial, and whether any of the learnings from ENDEAVOR went into that decision. The second question is, what the feedback has been from U.S.-based physicians about enrollment and the trial with the MP-based backbone. And finally, more of a commercial question for Helen, I guess. If you could just comment on what you expect the myeloma treatment landscape to look like when data from this trial is available and how success would position Kyprolis?

N. Anthony Coles

Okay. I think it might be appropriate, first, Helen, if you could start with the last question and really set the context. And then we'll go to the 2 clinical questions for Barb.

Helen I. Torley

Yes, as we look at the expected landscape, just as Barb and I showed you the expectation based on our registration studies, we'll be marching up from third-line indication to second-line indication. And our goal is to have Kyprolis be the treatment of choice and be the standard of care in all of those indications. As we come to the CLARION study, this body of evidence that we will have on Kyprolis, and the ability to show that this is an effective agent with the group risk benefit profile in first-line patients, again, is the evidence we believe we'll need to have Kyprolis emerge as a key treatment and a backbone of care in frontline patients. Not just in Europe, but also in the U.S., in these transplant ineligible patients. For the transplant-eligible patients, as Tony mentioned, we have some studies ongoing. We're going to continue to study that. And we'll propose to have the evidence to become the standard of care in this transplant-eligible population, also, in all over the world.

N. Anthony Coles

And, Barb, just a little bit of color, because I think the question is really about how the physicians are thinking about MP as a backbone. And then a little bit of why we chose a combo as opposed to high-dose monotherapy.

Barbara Klencke

Right. And I think we have a number of options and we consider these carefully. I think it wasn't an overwhelming -- there were many hard questions for us to answer internally. So we did choose a melphalan-based regimen, CMP, on the basis of a global applicability. And not to say that VD versus KD or CDE, would not have been a reasonable choice and one of which we'd love to get some additional data on the frontline setting. But maybe not as a pivotal trial. Related to enrollment of the melphalan-based regimen, I think when we think globally and we'll have global study sites around the world, I think we may not see a large proportion of U.S. patients. But we'll have some representation and I think we'll have good rapid enrollment utilizing the global approach.

N. Anthony Coles

Okay. Cory? On this side.

Cory William Kasimov - JP Morgan Chase & Co, Research Division

Most of my questions have been answered, but 2 of them, I guess, here. First, I'd like to ask Marshall's NCCN question to Helen in another way. Can you provide any precedent on what's happened with other drugs that you've looked at that have been added to the guidelines prior to their formal approval? And then my second question goes to the potential for less frequent administration when evaluating encapsulated carfilzomib. Are you able to provide any more clarity on how infrequent you're looking at here, is that simply for a better weekly formulation or are you thinking even less than that?

N. Anthony Coles

Okay. Good. Helen has got a one-sentence answer for you, so...

Helen I. Torley

The same one as I did before?

N. Anthony Coles

I think so.

Helen I. Torley

Well said, the same one as I did before. We really can't speculate on that and I don't want to infer that for Kyprolis.

N. Anthony Coles

I think that it's just -- it's not going to be helpful to anyone for us to move beyond that. I appreciate the interest in it but it's an independent process. We have been supportive with by providing data, but it is an independent process and we shouldn't speculate. And Chris, I'd love it if you could provide some context around the frequency of dosing. And mostly what that's telling us about proteasome inhibition and proteasome inhibitor is vis–à–vis oprozomib as well.

Christopher Kirk

So the first thing to note is that we're still in the formulation, evaluation stage, exploring a number of different technologies to extend exposure. We presented data showing in mouth tumor models, the efficacy of weekly administration of lyposomal formulations of carfilzomib but we're trying other technologies as well. The science will ultimately guide the design of the clinical trial to evaluate any new formulation, and so it's too early at this stage to speculate on what the ultimate formulation will be. But the ultimate goal is to deliver a long duration of proteasome inhibition by extending that exposure. And that's something that we know from the early trials with oprozomib is tolerated, proteasome inhibition, long-term proteasome inhibition, is tolerated for at least 5 consecutive days. And so this will help in determining the ultimate profile of that new formulation that enters the clinic.

N. Anthony Coles

Good. Thank you. We're on this side. Steven?

Steven Silver - S&P Equity Research

Yes. So as we think about the 006 data we're going to be seeing at ASCO, I think you've made comments recently about how that's a sicker patient population relative to ASPIRE. I know both studies allow patients to see prior Rev and prior Velcade. I think there are some new launches around that a little bit. But could you maybe just provide some color around what you mean by sicker? Is it just Rev exposure or...

Barbara Klencke

Yes. So 006 is a study of 84 patients that Onyx conducted a few years ago. We've previously reported on the response rate. And at ASCO this year, we'll present the PFS. It's a dose escalation study. So we started at low doses and escalated carfilzomib to 20, 27. But you'll have to recognize that about half of the patients in this 84-patient study, are in the Phase I, receiving doses such as 15 or 20 rather than 27 milligrams as the maximum carfilzomib dose. The Phase I portion of this data set actually just came out in publication, the manuscript form, a couple of weeks ago. And we'll have the entire data set, the 84-patient set at ASCO. So what do I mean by sicker patients? Yes, they've had higher rates of exposure, so more patients were previously treated with Revlimid and with Velcade than had been reported in the RD data prior to our CRD study. But what do I mean besides just more exposure? About half of those patients who had received prior Revlimid were Revlimid refractory at the time of entry or prior to entry into 006. So when half of the patients who have been exposed to Revlimid were refractory to Rev, those patients would not be eligible for the ASPIRE study because of the need to randomize the Revlimid. And that's probably the most obvious difference. And so, yes, I think it will be very difficult to -- it will be an apples-and-oranges comparison when we see 006, even though it's a CRD or KRD regimen. It's lower doses and half the patients and much prior high -- and rates of Revlimid refractory in this.

N. Anthony Coles

Okay. Is there a part 2 to that, Steven?

Steven Silver - S&P Equity Research

Yes. Just another question, actually, on Stivarga. Maybe just some color around the rationale as to pursuing Stivarga as a second-line agent in HCC, where it seems like the drug has fairly similar biology to that of Nexavar. And I guess in that study, is Bayer planning to cap the number of intolerants versus those patients, I guess, that are truly refractory to frontline Nexavar?

N. Anthony Coles

Dr. O'Neil, if you don't mind just providing some commentary, this is on the Phase III planned study in the second-line HCC setting? And then Helen may have some additional comments as well.

Bert O'Neil

Sure. I can't answer the second part of your question, I don't know the plan for numbers of intolerants. With regards to the rationale, these are drugs that are similar in some ways, but do have pretty significantly different kinase inhibition profiles. Obviously, part of the rationale for going second-line instead of head-to-head, is that the same companies are involved with both drugs. But if you look at tumor types like colorectal cancer where sorafenib have little or no activity, you essentially have a drug that is different enough that I think looking in HCC, in the refractory population, makes a lot of sense.

N. Anthony Coles

Thank you. One of the things I'll underscore in that answer is that the kinase profile, the kinase inhibition profile, between the 2 therapies is really radically different. And so, yes, they only vary by a single atom in terms of their chemical construct, but that single atom makes an enormous difference in terms of the kinase inhibition profile. And we see across the kinase inhibitors that the various nano molar inhibition actually does distinguish their activity in different tumors. So there is reasonable or plausible hypothesis that with a different kinase inhibition profile, both as an antiproliferative and as an antiogenic that it actually have some additional benefit after a Nexavar failure. Barb, would you add anything?

Barbara Klencke

Well, there was some Phase II data in about a cellular carcinoma with Stivarga, although their objective response rate was rather low, there was a really pretty encouraging stable disease rate of 4 and 6 months. So there is some preliminary evidence of potential activity there. I think the question about, will the trial allow patients who are intolerant? And I must say, I'll probably have to check the protocol and get back to you on those details. But even though the efficacy of the 2 drugs may differ and the kinome profile differs a bit, their pharmacokinetics differ a bit, their toxicity profile is pretty overlapping. So a patient who is truly intolerant of Nexavar would not be a good candidate for the Nexavar -- sorry, the Stivarga trial. So predominantly, we'll see patients coming in who were able to tolerate a period of time on Nexavar or even those who tolerated it all the way to progression.

N. Anthony Coles

Okay. Let's go with Howard and then we will cover this side of the room as well. Howard?

Howard Liang - Leerink Swann LLC, Research Division

I have 2 questions. One on STORM and the other on oprozomib. So on STORM, can you talk about where are most patients enrolled in the study and whether patients have access to Nexavar in the metastatic or advanced stage?

N. Anthony Coles

Okay. Barb?

Barbara Klencke

Yes, there -- where are most of the patients, you mean, geographic, whether it's -- yes, I actually don't have the breakdown of where this trial has been predominantly enrolled. It is -- it has been a global trial and there are Asian sites as well as European and U.S. And patients are likely to be candidates for Nexavar at the time of progression, essentially a crossover with it having global registration, that being a standard of care, I think we could not have ran the trial without allowing patients to receive Nexavar at the time of progression where it's indicated currently. But the primary endpoint is recurrent free survival. So this crossover, so to speak, would potentially impact OS, but it should not impact the recurrence free survival.

N. Anthony Coles

Okay. And then the oprozomib question?

Howard Liang - Leerink Swann LLC, Research Division

Yes. So just a question on the IMW update we might see. Can you talk about how many cohorts that we'll see on the new formulation and whether there will be an update on the old formulation -- a bit on the whole formulation as well. I think they were -- at ASH, there were physicians who did 3 PRs, there was one additional PR and one PR became a CR, whether that would be updated at IMW?

Barbara Klencke

So the focus of the abstract at IMW is on the newer patients, I think the number of cohorts, we'll wait and see what the abstract shows. I hate to preface too much of that data. It's small numbers. But I will say the study has enrolled well on the cohorts, are able to be studied for their DLT window in just 2 weeks. So even though we only started the new formulation in November and had to submit the abstract in January, there's a few more patients than you might imagine. It's more -- it's in a range of 10 to 20 patients over several cohorts. Interesting question about whether we can update the data that was shown at ASH. And I'll check with the team on that and we'll have to see what we can get into the poster or the presentation as a background for that.

N. Anthony Coles

Okay. I think, no questions on the right side. So Biren, we'll go to you.

Biren Amin - Jefferies & Company, Inc., Research Division

First, I guess on Champion 1. I believe this is, I guess, a weekly administration study on the relapse setting. I'm just trying to understand because I think there's an amendment made on clinicaltrials.gov where you are now testing the highest dose at 88 milligrams, which was not in the original protocol. So I'm trying to understand what drove the factor for this change. And then I've got a second question for Helen.

N. Anthony Coles

Okay.

Barbara Klencke

As far as I know, the protocol was, and it may have recently been amended for another reason, but 88 was the maximum protocol dose planned for testing and still is. So we're testing 88 at this point in time and I think that's the -- there is no new information about any changes.

Biren Amin - Jefferies & Company, Inc., Research Division

Great. And then I guess for Helen. I think you showed some market research data that showed Kyprolis use will increase or physician expected -- 71% of the respondents expect to increase Kyprolis use in 2013. I'm trying to understand whether that was in context of Pomalyst launch in early '13 when you posed that question to those respondents?

Helen I. Torley

That particular question was not in the context of the Pomalyst launch. That was just asking them about their experience with Kyprolis.

N. Anthony Coles

Okay. Very good. Right side of the room? You guys good? Okay. While you're thinking, let's come back to this side. And, yes, sir?

Ryan Martins - Lazard Capital Markets LLC, Research Division

Ryan Martins with Lazard. Just on the transplant-eligible patients frontline, the recent update to the guidelines. What's the thinking around the dose that can be used? That wasn't obviously specified. Maybe you can comment, maybe Dr. Landgren can talk about it?

N. Anthony Coles

I think I actually know the answer to that one. But Barb will tell me if I get it wrong. The NCCN actually studied the question and said that there wasn't sufficient data gathered yet to determine a recommended dose and that additional information would be required. So I think we will have to stay tuned. And this is something that we'll, as Helen said, we'll contemplate when we flush out the transplant-eligible strategy that we take for Kyprolis. All right. All right. Here we go. Right side. Okay. All right, they have beaten you guys, so come on. Mike, we've got second go-rounds.

Michael G. King - JMP Securities LLC, Research Division

I wonder -- a question for Helen. I know there's an IST with Dr. Berenson that's using 88 milligram per meter square. On a conversation with him, he actually thinks he can go higher, but he's using a 60-minute infusion time. So as you contemplate, once we give Kyprolis at higher doses, just wondering sort of what is the outer bound of chair economics where you can slow the infusion only so much before you can start inhibiting practice economics?

Helen I. Torley

I have to say, Mike, at the moment what we're doing is just trying to determine what is the best dose and time of administration for patients and I can't answer the question on anything beyond that. What we're looking for is demonstrating the efficacy profile. That's all. And we've got a number of investigations going on looking at that, including ISTs like Dr. Berenson's.

N. Anthony Coles

But, Chris, I wonder if you could talk a little bit about the rationale from moving to kind of a quick infusion bolus to the 30-minute infusion, what we think that buys us and what that might or how that might complement higher dose levels?

Christopher Kirk

Right. As I mentioned earlier, carfilzomib is an irreversible inhibitor of the proteasome. And that means that the amount of target inhibition is not a function of the Cmax, it's not a function of the trough levels, it's a function of the total exposure, the total area under the curve. What we did find, by switching from a 2- to 10-minute infusion to a 30-minute infusion, was that by reducing the Cmax, tolerability went up and we could escalate those from 27 to 56 mgs per meter square in patients with multiple myeloma. Because of that data, we are now exploring longer infusion times. Also part of the rationale for the oprozomib, dose formulations and pharmacokinetic profiles which show a very long area under the curve for pharmacokinetic exposure.

N. Anthony Coles

Okay. Good. Excellent. Rachel?

Rachel L. McMinn - BofA Merrill Lynch, Research Division

I just wanted to turn the question from this side of the room. You said, you've reiterated quarter-over-quarter growth and then you also mentioned these local partnerships and rest-of-world deals, mentioning Israel is already done and that you'll -- you're planning to have other deals this year. So I'm wondering whether those 2 things are connected. In other words, do you feel more confident about quarter-over-quarter growth because you'll have like a mini bolus from Israel and then some of these other countries coming into that line or are you specifically talking about U.S. quarter-over-quarter?

N. Anthony Coles

I know the answer to that, too, but Helen should do it.

Helen I. Torley

When we talked about quarter-over-quarter growth, that really is in the U.S. At the time when we made that statement, we hadn't got as far along in terms of our distributor plans. So that is related to the U.S.

N. Anthony Coles

I think for most of the 2013 partnerships, you really should look for very, very small contribution from a revenue point of view. There's smaller number of patients. But what we're really working to do is not to miss any opportunity to get the therapy to patients as quickly as possible. So small, small, small numbers there. Marshall, I know you had a question?

Marshall Urist - Morgan Stanley, Research Division

Just actually a quick one on RESILIENCE. Just can you tell us how many events trigger the PFS analysis or what percentage of events trigger that? And then would you expect a kind of similar patient mix relative to the randomized Phase II? Because I remember there was a different sort of performance in the first and kind of second-line patients from that trial.

Barbara Klencke

Yes, I think I won't comment on the specifics to the statistical analysis, the number of events, the percent of events that we'll need to see that would trigger the analysis. And similarly, I think in terms of looking at a baseline characteristics of an ongoing trial and speaking about that, we will be certainly planning to do subset analysis of looking at patients who have received one prior metastatic line versus additional prior metastatic lines. And that was fairly certain a stratification factor. But how it will compare to what we saw in Phase II, we'll talk about that when we have the actual data.

N. Anthony Coles

Okay. Matt [ph], again. Just here. Yes.

Unknown Analyst

Helen, you mentioned the U.S., the E.U. and then ultimately the rest-of-the-world, geographic expansion potential that you have. And if you look at where Velcade has sold, it's sold a lot in that sort of rest-of-the-world bucket. And then if you look across other biopharmaceutical categories, you've seen when you get sort of approval in the BRICS, for example, that you get relatively rapid uptake through tender sales, things like that. Can you talk about your thinking, I know this is going pretty far out here in terms of the time lines, but do you have any ideas about how you can best leverage that rest-of-world bucket where there's some Velcade use?

Helen I. Torley

Yes. What we shared with you was the first focus is on those markets that do recognize the U.S. approval and focusing on those. Other markets, like some of the BRIC markets, do need to have their own registration programs. And so that will be likely the next part of the strategy is identifying how we can fulfill the registration requirement in other large opportunities such as the BRIC areas. So stay tuned for more information on that as we solidify our strategy. As Tony said, our goal is to get Kyprolis to as many patients as possible. But that is a little bit further down the line. It could be dependent on some of our ongoing registration studies. China could require different types of studies. So active evaluation and certainly a part of our consideration at the moment.

N. Anthony Coles

We thought about this in stages, Matt, just to give some dimension to Helen's comment, which I agree with. But really, this is the first wave U.S. and then the local markets that recognize the U.S. And then beyond that, the E.U. expansion and then beyond that, the rest of the countries where it would take a little more infrastructure, perhaps, and thought. But we plan to get to all the markets as efficiently as we can, where it makes sense. Robyn?

Robyn Karnauskas - Deutsche Bank AG, Research Division

Great. So a question on FOCUS and ASPIRE for Europe. So maybe if you can talk a little bit or remind us a little bit out how the focus trial differ from other refractory trials as far as the patient population enrolled? And how important is FOCUS versus ASPIRE for European approval? We've had some consultants mention that maybe from a cost perspective, the ASPIRE regimen might be costly in Europe. So how do we think about Kyprolis in Europe given those 2 trials?

N. Anthony Coles

I think -- there's cost and there's a population comparison question. Why don't you do the population comparison question first, Barb, because I think that will set Helen up for her answer.

Barbara Klencke

Well, I think it's been a period of time since there have been good data sets on this relapse refractory patient population. But as more drugs are being studied in this indication of Pomalyst and particular in their Nimbus study, that gives us some flavor for how -- what the outcome of patients might be with dexalone. How the patients differ? Well, our patients in FOCUS are required to be refractory to the last line of therapy. That's similar to 003-A1. They are required, in this case, in FOCUS, to have 3 or more prior lines of therapy. In the U.S., in 003-A1, they were only required to have 2, but in fact, only a small proportion of patients receive 2. The median was 5 lines and patients went all the way up to double digits. So I actually expect the FOCUS population not -- I don't know anything yet that would suggest that it will be too much different than the 003-A1 population.

Helen I. Torley

And then in terms what the peers are looking for in terms of reimbursement. I certainly think we are hearing overall survival, which is the FOCUS study is a very important endpoint for them, very important part of that value story I talked about. You raised the point about the ASPIRE being in combination of 2 novel agents and what challenges will that face. I think that's exactly why I said we're going to wait and see what the ASPIRE data is. It all comes down to the value story you can tell as to what benefit this is having to patients, but importantly, what cost it's going to cause to the system versus what it currently is today. And that's why we need the data to determine. But both studies can support a European filing and we are preparing for [indiscernible] for that eventuality. FOCUS alone, FOCUS on ASPIRE, ASPIRE only. All of those are paths forward for us in Europe.

N. Anthony Coles

We just a couple of minutes left. And so I'm scanning the room to see if there are any other questions. Final question? Ryan?

Ryan Martins - Lazard Capital Markets LLC, Research Division

So a couple, just to clarify on the European filing. So even if you see a positive interim on FOCUS, you would still need for your ASPIRE data before you file?

Helen I. Torley

No. I think it all depends. All I can say is we're going to ask to see the data and the timing of the data to make the final call. What could happen is that our European filing could be done on FOCUS alone.

Ryan Martins - Lazard Capital Markets LLC, Research Division

Okay. And then one final one. I know it's not your asset, but palbociclib, can that -- I mean, do you know if that could be Pfizer is planning on maybe filling that prior to getting the data from the Phase III, could that be filed for approval with the data that currently exist?

N. Anthony Coles

I'm sorry, I missed the last part of it.

Ryan Martins - Lazard Capital Markets LLC, Research Division

Can it be filed for approval with the data that's already in hand by Pfizer?

N. Anthony Coles

Oh, in the Phase II data that was reported in San Antonio Breast?

Barbara Klencke

I think Pfizer would have to speak to that. It's a dramatic benefit seen in a Phase II, but Pfizer really would be the one to be able to address that question.

N. Anthony Coles

It's also probably premature to speculate. One of the things that's happening at the FDA is the creation of alternative pathways for review. Everyone's in touch with the Breakthrough Therapies pathway that a couple of companies have benefited from. So that, perhaps, is a way forward, but we really want to leave that to Pfizer for a specific guidance.

Okay. Good. Well, thank you, guys. This has been terrific. We hope that we've given you a great sense about the complexity of the business, everything that's happening and the richness. Stay tuned for further updates and we look forward to talking to you very, very soon. Certainly in the first quarter call in early May. Thank you.

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