Poniard Pharmaceuticals, Inc. Q1 2008 Earnings Call Transcript

Poniard Pharmaceuticals, Inc. (NASDAQ:PARD)

Q1 2008 Earnings Call Transcript

May 6, 2008 5:00 pm ET


Brendan Doherty – Corporate Communications

Jerry McMahon – Chairman and CEO

Caroline Loewy – CFO


Michael Barrick [ph] – Oppenheimer & Co.

Matt Osborne – Lazard Capital Markets

John Eckerd [ph] – Leerink Swann


Good day and welcome to the Poniard Pharmaceuticals first quarter earnings results conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Bren Dougherty, Manager, Investor Relations and Public Relations. Please go ahead, Mr. Dougherty.

Bren Dougherty

Thank you, and welcome to Poniard Pharmaceuticals first quarter 2008 financial results and achievements call. On the call today from Poniard are Dr. Jerry McMahon, Chairman and CEO; Ronald Martel, President and Chief Operating Officer; Caroline Loewy, Chief Financial Officer; and Dr. Robert De Jager, Chief Medical Officer.

We issued a press release earlier today, a copy of which can be found at www.poniard.com in the News and Events section. Before I begin, I would like to remind you that various remarks that we make on this call including those about our financial results and operations, product development programs and goals, timing and results of clinical trials, and future prospects, growth opportunities and competitive position constitute forward-looking statements for the purposes of the Safe Harbor provision of the Private Securities Litigation Reform Act.

These forward-looking statements and all other statements that may be made on this call that are not historical facts are subject to a number of risks and uncertainties that may cause actual results to differ materially. We refer you to our annual report on Form 10-K, in particular to the section entitled Risk Factors for additional information on factors that could cause actual results to differ materially from our current expectations. These forward-looking statements speak only as of the date of this presentation and we disclaim any obligation to update the forward-looking statements.

With that, I will turn the call over to Dr. Jerry McMahon, Chairman and CEO of Poniard.

Jerry McMahon

Thank you all for joining us today. We are pleased to share with you our recent clinical and corporate progress and significant accomplishments. Of particular note, we announced this afternoon that we completed enrollment of our Phase II trial of picoplatin in metastatic colorectal cancer, which I will describe later in more detail. After my recap of recent milestones, Caroline will provide an overview of our first quarter 2008 financials, and then I will conclude with a summary of our targets for the remainder of 2008.

We have made significant progress in the past quarter in building the value of picoplatin as a platform product in three ways. First, developing picoplatin as a product which can overcome platinum resistance. Second, developing picoplatin as the preferred platinum. Third, as an agent in the treatment of cancers for which platinums are not currently used.

Picoplatin, our lead product, is a platform product and has the potential for use in multiple tumor types, combinations and formulations. Picoplatin has been studied in over 750 patients in numerous different tumor types either as a monotherapy or in combination with various chemotherapeutic agents. Signals of efficacy have been observed in a variety of solid tumors.

Picoplatin is well tolerated with manageable toxicity both as a monotherapy and in combination with many chemotherapies, including paclitaxel, docetaxel, liposomal doxorubicin, gemcitabine, topotecan, 5FU and leucovorin, and vinorelbine. Poniard is currently studying the intravenous formulation of picoplatin in three solid tumor indications, in small cell lung cancer, colorectal cancer, and prostate cancers.

In addition, we are studying an oral formulation of picoplatin in solid tumors. Data suggests that picoplatin could have significant value for patients and caregivers in a broad range of tumor types, and we will grow the substantial global market for platinums in oncology. During the first quarter we made significant progress in establishing picoplatin as a platform product and providing a good foundation for supporting additional registration trials, thereby expanding its potential.

Our most advanced study is the pivotal Phase III SPEAR trial for study of picoplatin efficacy after relapse in small cell lung cancer, which continues to enroll patients. We are targeting top line data in mid-2009. We plan to present results from our Phase II studies in both metastatic colorectal cancer and hormone refractory prostate cancer at the American Society of Clinical Oncology meeting or ASCO, this June, and various scientific meetings throughout the year.

We are also evaluating an oral formulation of picoplatin in an ongoing Phase I trial in patients with solid tumors, which is targeted for completion later this year. At the Annual Meeting of the American Association for Cancer Research or AACR, we presented encouraging bioavailability data from our ongoing Phase I trial of oral picoplatin in patients with solid tumors showing that picoplatin can achieve oral bioavailability. This supports further clinical development in indication-specific Phase II clinical trials.

Oral picoplatin could be developed in new combinations with radiation and oral chemotherapies, as well as targeted agents. In April, we presented data at the AACR meeting indicating that picoplatin retained its activity in small cell lung cancer cell lines made resistant by cisplatin, carboplatin, or oxaliplatin. We also announced an agreement with Althea to use its Express Pathway platform to identify molecular signatures that may be correlated with platinum resistance.

We believe that the development of molecular signatures of platinum resistance may enable the development of biomarkers. Picoplatin was specifically designed to overcome platinum resistance, a significant issue that limits the use of existing platinums. We are leveraging this property of picoplatin in our development of the product in second line small cell lung cancer. The data being generated in our Phase III trial in small cell lung cancer can serve to support marketing approvals in this indication.

Our previous Phase I and 2 studies to date serve as proof of concept for use of picoplatin in other tumor types where patients often fail or do not respond to first-line treatment with a platinum-based chemotherapy. Therefore, our Phase III trial in small cell lung cancer could not only serve to support marketing approvals in this indication, but could also validate the survival benefit of picoplatin use in second-line settings where platinums are used first line.

Treatment options available for small cell lung cancer patients who develop platinum resistance or who do not respond to first-line treatment are limited. This group of patients have the worst prognosis and survival rates for this type of lung cancer are very poor. In April, we presented the final data from our Phase II small cell lung cancer trial at the European Society for Medical Oncology Lung Cancer Conference.

These final efficacy results confirmed previous results showing a survival benefit in patients with recurrent small cell lung cancer, who failed platinum-containing first-line chemotherapy or who progress within six months of first-line therapy. During the first quarter, we continued to make progress in our Phase III SPEAR pivotal trial comparing picoplatin with best supportive care to best supportive care alone.

This trial is enrolling small cell lung cancer patients who failed prior platinum-containing first-line chemotherapy or who progressed within six months of first-line therapy. This registration trial is currently being conducted under an SPA from the FDA, and it’s evaluating overall survival as the primary endpoint. Our 27-week Phase II median overall survival data compares favorably with the published median overall survival data for best supportive care, which is 13 weeks in this patient group.

We are targeting top-line data from this study in mid-2009. Picoplatin has received orphan drug designation in the United States and Europe, and fast track designation was granted by the FDA, enabling a rolling NDA submission. Picoplatin has been evaluated in over 750 cancer patients, and has good safety profile including lower incidents and severity of nephrotoxicity, ototoxicity and neurotoxicity compared to existing platinums.

Data and recent market research support that picoplatin could be positioned as the preferred platinum used in settings where toxicities limit the use of the existing platinum chemotherapies. In the first quarter we made several significant strides to expand picoplatin's potential as a preferred platinum.

In January 2008, we presented safety data from our 50-patient Phase I dose escalation study of picoplatin in metastatic colorectal cancer at the ASCO GI Symposium. Picoplatin was administered in combination with full dose 5FU, 5-fluorouracil and leucovorin, and has demonstrated a manageable toxicity profile. Importantly, there were no severe Grade 3 or 4 neuropathies. Nephrotoxicities or ototoxicities were rare and mild. Based on this data, we initiated a randomized Phase II study November 2007, comparing picoplatin to oxaliplatin both in combination with full dose 5FU and leucovorin.

We announced today enrollment has been completed on schedule. We plan to present data at ASCO in June and other scientific meetings. The objective of this Phase II trial is to generate proof-of-concept data that picoplatin has an improved safety profile sparing neuropathy, compared to oxaliplatin, and to evaluate clinical activity. This study could provide a good foundation for enabling a Phase III trial.

At the February 2008 ASCO GU Cancer Symposium, we reported encouraging safety and efficacy data from our Phase I dose escalation study of picoplatin in patients with hormone refractory prostate cancer. Picoplatin was shown to be safely administered in combination with full dose docetaxel and prednisone, the current standard of care for first-line hormone refractory prostate cancer patients. The follow-up Phase II study completed enrollment in late 2007, and we plan to present data from the study at ASCO in June, and at other scientific meetings.

During the quarter, we also made significant strides forward in preparing picoplatin as a commercial oncology product, ensuring that picoplatin is available to patients and oncologists once FDA approval is obtained. Recently, we signed an agreement for the commercial manufacture and supply of picoplatin drug substance with Heraeus. This agreement is a major and necessary step forward in the development of picoplatin as a commercial oncology product.

In addition, we appointed Dr. Robert De Jager as our Chief Medical Officer to strengthen our clinical development team and help us move picoplatin through clinical development and toward product approval. Dr. De Jager has an extensive background in drug development at both pharmaceutical and biotechnology companies. In addition, he has held academic appointments at leading cancer centers. His expertise in developing and registering novel cancer therapeutics in global markets is an asset to Poniard as we continue our efforts to advance picoplatin towards commercialization in the treatment of solid tumors.

To summarize, there is a significant and growing body of data supporting the potential picoplatin as a platform product in three ways. One, as a new generation platinum that overcomes platinum resistance. Two, it has the potential to be the preferred platinum for indications where existing platinum therapies have significant treatment-limiting side effects. And, three, it is a new platinum agent that could be used in cancers where platinum agents are not currently being used.

I'll now turn the call over to Caroline, who will review the financial results and provide guidance for 2008.

Caroline Loewy

Thank you, Jerry, and good afternoon. Today we released our financial results for the first quarter ended March 31, 2008. I will cover some of the highlights of those results. With respect to our consolidated statement of operations, we reported a net loss of $9.9 million for the first quarter of 2008, compared to a net loss of $7.7 million for the same period in 2007.

The total operating expenses for the first quarter of 2008 were $10.5 million, compared to $7.9 million for the 2007 quarter. The net cash used in operations during the first quarter of 2008 was $7.1 million. The increase in expenses in the first quarter of 2008 was primarily due to increased clinical costs associated with our four ongoing clinical trials and picoplatin drug supply.

Research and development expenses increased 15% to $6.3 million for the first quarter of 2008, from $5.5 million for the first quarter of 2007, primarily as a result of higher clinical costs associated with the company's picoplatin trials and increased costs for other R&D efforts.

On the balance sheet we ended the quarter with cash and investment securities of $84.7 million compared to $92.6 million on December 31, 2007. We continue to believe that our existing cash and investment securities will provide adequate resources to fund our operations at least through the second quarter of 2009.

With that, I'll turn the call back over to Jerry.

Jerry McMahon

Thank you, Caroline. We are excited about the progress we have made in the clinical development of picoplatin for which we are evaluating multiple indications, combinations and formulations, and we are working diligently to bring picoplatin to market for the treatment of patients with cancer. During the remainder of 2008, we anticipate further important advancements and activities related to our picoplatin program.

We intend to continue enrolling our Phase III SPEAR trial in small cell lung cancer, and advancing picoplatin towards NDA filing. Present emerging Phase II clinical data from both our metastatic colorectal cancer and hormone refractory prostate cancer trials at ASCO in June, and other scientific meetings. Present additional data from our Phase I oral picoplatin study at scientific conferences, and evaluate opportunities to expand picoplatin development in additional tumor types, indications and combinations, and prepare picoplatin for commercialization and partnering.

I am excited with the progress made in both of our Phase II studies, as well as in the oral Phase I trial and the data that was generated from these studies earlier this year. These results set the stage to position picoplatin as a platform product. I am pleased to see the necessary ingredients for success, a strong and capable management team, a product with broad applications, and in areas of great unmet medical need.

I am pleased with these developments at Poniard as we continue to transition from an R&D to a commercial company. It is gratifying to reflect on these developments at Poniard. But on behalf of the management team, we thank you for your interest in picoplatin and Poniard, and look forward to communicating with you on our progress throughout the year.

With that, we would be happy to answer your questions. Operator, please poll for questions.

Question-and-Answer Session


(Operator instructions) We'll take our first question from Brett Holley with Oppenheimer & Co.

Michael Barrick – Oppenheimer & Co.

Oh, hi. This is actually Michael Barrick [ph] on behalf of Brett. I just have a question about the colorectal cancer trial. Acknowledging that you just completed enrollment in the study, can you provide any information about the number of patients and the duration of follow-up that you'll presenting at ASCO?

Jerry McMahon

As we indicated, we completed enrollment and we plan to provide a more complete updated Phase I data information at ASCO, as well as some early data related to the Phase II trial for those patients that have been treated long enough with drug. And that's really the only guidance we are giving at this point.

Michael Barrick – Oppenheimer & Co.

Okay. Okay, great. For SPEAR, as enrollment continues and you are continuing to collect more information about events, is the event rate more or less tracking along what you are expecting at the beginning of the study?

Jerry McMahon

We are not providing any information in regard to event rate. Again, we made a lot of progress and continue to make a lot of progress with this trial, and we are focused on analyzing the data from this trial in the middle of next year.

Michael Barrick – Oppenheimer & Co.

Okay, great. Thank you.


We'll take our next question from Matt Osborne with Lazard.

Matt Osborne – Lazard Capital Markets

Hi, guys. Thanks for taking the question. Jerry, can you comment at least on the FOLPI versus FOLFOX? Will it be data from the independent reviewers or from the investigator reviewed CAT scans?

Jerry McMahon

This is a preliminary – this is an open-label study, so we have the ability to look at the data and it provides us with an opportunity to get a first, if you will, glimpse of what's going on in our Phase II trial. We do have an independent review of the neurology. We have a neurologist who is involved with the study, who provides an analysis of that safety aspect of the trial in a blinded fashion. But the remainder of the data is data that we analyze ourselves at the company to provide an appropriate scientific disclosure for ASCO.

Matt Osborne – Lazard Capital Markets

Great. Can you remind us in this study, were patients allowed stop-and-go treatments with oxaliplatin in the FOLFOX regimen?

Jerry McMahon

No. The study design really provides that either a patient would be treated with oxaliplatin alone as part of the combination or with picoplatin alone as part of the combination.

Matt Osborne – Lazard Capital Markets

Then can you provide any clarity on, I guess the ongoing Phase I trial with the every other week dose, if the maximum tolerated dose has been reached yet and what your plans are with that schedule?

Jerry McMahon

Yes. We haven't indicated whether that biweekly regimen in the Phase I has achieved the dose-limiting toxicity. But obviously, we will be providing data at ASCO that reflects the status of that trial at that time. From January, we were analyzing a dose level of 120, and we continue to obviously move that trial forward. So, we will have an update at ASCO of where that trial stands with respect to either achieving the DLT or what the safety data looks like for the biweekly regimen.

Matt Osborne – Lazard Capital Markets

Fair enough. Last question, any thought about what a potential trial design may look like for Phase III and perhaps timing around that?

Jerry McMahon

At this point, as we mentioned in the statement, we believe that this type of data could enable a Phase III trial, but we know we need to provide additional work around defining what that trial needs to look like, and of course, having the appropriate conversations with the regulatory authorities to make sure that a registration trial would be appropriate. So, at this point, we don't want to define what that strategic design looks like, but we would anticipate as this data emerges in the second half of this year that those are exactly where we would be focused in trying to define what that registration trial needs to look like.

Matt Osborne – Lazard Capital Markets

Great. Thanks for the update.


(Operator instructions) Our next question comes from Howard Liang with Leerink Swann.

John Eckerd – Leerink Swann

Hello. This is actually John Eckerd [ph] in for Howard. I have a quick question about the sites for the SPEAR trial. And if I'm not mistaken from the last time there was a slightly slow uptake in some of the Eastern European countries. Could you discuss a little bit of the dynamics of the sites since the last update and did you get a lot on quickly and therefore a lot of patients enrolled quickly after the last update?

Jerry McMahon

Yes. As we said on the last call, we had put various initiatives in place to "get those sites up to where we wanted them to be." And we can say today that we're at approximately 100 clinical sites, which was the plan for this study and most of those sites are active in enrolling patients. So, I think from where we were on the last call, we feel things are moving well and we feel comfortable with our mid-2009 data analysis target.

John Eckerd – Leerink Swann

All right, great. With regards to potential meetings for both the prostate and colorectal later in the year, you probably don't have it finalized, but would like URTC and are there any particular ones that you might be earmarking?

Jerry McMahon

URTC is probably a little early for us. The abstract is due the end of May. But there are other meetings that are out there, like the chemo meeting in New York, as well as again the satellite meetings that would emerge in the beginning of next year. So, we haven't made a decision yet what would be the appropriate scientific meetings. But we are definitely conscious of those abstract submission deadlines, and depending upon when the data would emerge, we could write appropriate abstracts to discuss the data at those meetings.

John Eckerd – Leerink Swann

All right. Great. Thank you very much.


At this time, this concludes the Q&A portion of the call, and I would like to turn the call back to Dr. McMahon for any closing comments.

Jerry McMahon

Thank you, operator, and thank you, everyone, for joining us on the call today. We look forward to seeing you at upcoming investor conferences and medical meetings. Just a reminder, please check your e-mail in the coming days for an invitation to the ASCO investor event. We look forward to seeing you in Chicago. Thank you very much.


That does conclude today's conference. We thank you for your participation. Have a great day.

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