ImmunoGen's CEO Presents at Morgan Stanley Global Healthcare Conference - Transcript

Sep.12.12 | About: ImmunoGen, Inc. (IMGN)

ImmunoGen, Inc. (NASDAQ:IMGN)

Morgan Stanley Global Healthcare Conference

September 12, 2012 08:00 AM ET

Executives

Dan Junius, President and CEO

Analysts

Marshall Urist - Morgan Stanley

Marshall Urist - Morgan Stanley

Good morning everyone and welcome to the precession of the third day of the Morgan Stanley 2012 Global Healthcare Conference. I am Marshall Urist one of the biotech analysts here at Morgan Stanley and before we get started just a couple of quick pieces of business. Number one, any of – all of our relevant research disclosures can be found in our website or on any piece of our research and second, it is absolutely supposed to be an open and interactive session so if you have questions please raise your hand and there are certainly microphones circulating. So, with that we are happy to be here this morning with Dan Junius, President and CEO of ImmunoGen. Dan, thanks for being with us this morning and maybe to start off take a few minutes to give sort of an overview of what you are focused on right now and what are the most kind of important things for people to think about in the next 12 months.

Dan Junius

Sure. Thanks Marshall and thank you for inviting us. Maybe just by the way of background in terms of the company, the technology, and our movement is some of the things that we are involved with. The company is built on a technology that uses the targeting ability of an antibody to find a target on a cancer cell and we’ve developed a technology that has both proprietary toxin that we use and a means of attaching that toxin to the antibody that is delivered for us a very effective targeted therapy for oncology.

We’ve been working on that and we continue to bring new innovations in and where we are with the program at this point, from a strategic standpoint we are in the process of moving to a company that develops proprietary compound. We have (inaudible) in the clinic today. I’ll come back and just provide a brief update on that, but that effort has been somewhat overshadowed by what is taking place in our partner pipeline.

There are 8 compounds in the clinic and two partners, our partner includes Roche, Sanofi, Novartis, Lilly, Bayer and the dominant compound or the most advanced compound in that partner pipeline is T-DM1. T-DM1 gained a compound being advanced by Roche as effectively the replacement for Herceptin. Herceptin, both because of its coming off of patent, but also because of some extraordinary data that has been reported associated with T-DM1 has shown it to be very effective and we’ve seen it thus far in the first line and second line showing a substantially better efficacy while affording the tolerability benefits associated with the targeted therapy that is in place. So, the partner pipeline is developing nicely. T-DM1 will be a lot of news coming out on that and there has been a lot of news to date, but that will continue as they now have the compound submitted for metastatic treatment for patients who failed an earlier line of Herceptin therapy and so we will hear more about that hopefully acceptance and approval by the FDA and European regulators, but they are also looking at an adjuvant. They have a gastric study underway so there is quite a bit taking place there. Behind that on the partner side, there are a number of other compounds that are advancing.

Sanofi has a compound for Non-Hodgkin's lymphoma that is in three phase, two studies. We expect to be hearing more about that, but that it is over the coming quarters. The data thus far has been very good, both in terms of efficacy as well as tolerability and other partners are advancing their compounds. We expect to see some of those compounds moving into pivotal studies over the course of 2013.

So, a lot going on in the partner front. Our newest partner Lilly and Novartis are doing a lot of work pre-clinically. We think that those will lead to compounds coming to the clinic in a reasonable period of time, but back to the proprietary side as for the strategy is to build on the technology base that really has been funded through a lot of partner activity over the years and advance the proprietary pipeline.

Our most advanced proprietary compound is IMGN901 that is in page 2 clinical studies for first line small cell lung cancer in combination with carboplatin and etoposide. Small cell lung cancer we know is a very difficult disease. Patient’s respond to the existing therapy, but with no durability. So, what we are looking for is to be able to extend the durability of a response by adding 901. We had data just to the symposium last week out in Chicago and what that data showed in establishing the phase II dose, it was essentially an all comers study for patients who would be getting a carboplatin etoposide therapy to which we added 901. Most of these patients expressed their target CD56, but what we found was, a) that we could dose 901 at the same level that we dosed it in monotherapy studies, which again speaks to the tolerability of this approach but also that we saw some interesting activity in small cell lung cancer patients, because they were a number of them in the study. A few of them chemo-naïve, many of them platinum-refractory/resistant and we saw some activity there, which can be very difficult in later stage small cell lung cancer patients. So, very encouraged with that. Behind that we have two other compounds that have come into the clinic over the last several months one, for Non-Hodgkin's lymphoma, the target there is CD37. We think while Non-Hodgkin's lymphoma receives a lot of attention, there are a number of therapies there, we think this is a highly differentiated offering because again using our antibody-drug conjugate technology. What we’ve done is we’ve developed an antibody that pre-clinically has shown a high level of activity as a naked agent, to which we have then added our conjugate technology. So, we think that offers tremendous promise and then, the last proprietary compound which really just started dose in few months ago, is one that targets the Folate receptor 1. And we think that it’s an interesting target, over expressed in a variety of cancers. And what we have with that particular compound, in addition to it being an interesting target, we brought forward our fourth unique linker, and each of our linkers conveys a different set of characteristics on the conjugate, this one happens to counter multi-drug resistance which it can common in many cancers and pre-clinically this looked to be a highly efficacious compound. So, we’re excited to see that develop. So that’s kind of a mini update on where we are.

Question-and-Answer Session

Marshall Urist - Morgan Stanley

Perfect, so I need to get place to start and so like you did, why don’t we start with T-DM1. So, a couple of things, obviously there has been some discussion recently about, you know exactly how the T-DM1 agreement with Roche works? So, maybe you know, talk through that both in terms of how should we think about royalty and term and then particularly, you know IP and how IP and non-IP territories plays into things?

Dan Junius

Sure, because there are few dimensions we’ve had disclosure on this, because we felt an important that investors have an understanding of what the dimensions are that are appropriately disclosed. From a royalty standpoint, what we’ve indicated is that our expectation or what the contact provides for a roughly a mid-single digit royalty to ImmunoGen. It’s tiered but it actually deal something -- again, roughly mid-single digit.

The other dimension around the term and there an extensive discussion in our last conference call around this, again reinforcing disclosure that had taken place earlier is that the term of the contract provides for us to receive royalty from the date of first commercial sale on a country-by-country basis, for at least 10 years and as many as 12 years, provided there is a patent in place in the country, where the compound is being sold. So, it’s important to understand it’s a maximum of 12 years of royalty on a country-by-country basis.

It brings in the issue then of patents, well, what’s the IP surrounding this particular compound that would allow us to receive the royalty. And I guess I should note, and when I say royalty I am looking at that full mid-single digit royalty that I referenced earlier. If there is isn’t IP, there is a default royalty at a much lower level in most single digit rate, that we would receive for 10 years. But I am focusing on the full royalty.

From an IP standpoint, as we look at the major markets, the U.S., Western Europe, Japan, we’re comfortable that we have IP that will allow us to receive royalties for that full 12 year period, assuming approvals go in line with what the expectation is today.

People have pressed on the question of what can you tell us, can you point to the specific IP, that becomes a little bit problematic, because given the nature of the technology that we have, there is a variety of IP that can apply can be a composition of matter IP, it can be process related IP and the issue what process IP is, we have a number of different processes associated with various elements of manufacturing and antibody drug conjugate and for us to point to a specific process that applies with respect to T-DM1 would be disclosing information would be inappropriate, because it’s then providing a road map for someone who may be looking at putting in place by a similar or circumventing processes there. We think the IP is very strong but we think it’s inappropriate to be providing that road map, and it’s also not we haven’t even approached the subject with Roche because we don’t think it’s appropriate that we even had some consideration, we wouldn’t want to put them in that position.

Marshall Urist - Morgan Stanley

Makes sense, so it is helpful. So, maybe focusing on the next data set that we’re going to see, that we’re going to see for T-DM1. (inaudible) obviously we had got some positive news on the survival data from EMILIA, but then looking at the 2013 and then maybe longer term, you know Roche has obviously is making a very big push behind this drug. So, maybe layout in the past too, can it be risking both the metastatic setting and then ultimately, you know the much bigger adjuvant opportunity?

Daniel Junius

Yes, I think we will get a little bit more inside on the metastatic setting as early as ESMO. So, ESMO is now coming up, it bridges to the end of September, early October. But I think what we will see is the data that was underlying the announcement from Roche several weeks ago about the topline survival data. If you look at the agenda for ESMO, it notes that they will be discussing the survival data from EMILIA, so I think we will get that insight. I think that we don’t have access to the data, but expect that to be useful information. But beyond that as you look at 2013, 2014, even into 2015 there is a roadmap that says in 2013 we should be seeing data coming out of the MARIANNE study. The MARIANNE study is again in the metastatic setting, this would be for Herceptin in naive patients, that study has been underway. I think they announced at ASCO that they completed enrollment and so I would expect some time around ASCO next year, or so, they may be at a point where they would have data to report on MARIANNE. Again, it may not be the complete data set in the same fashion that it was in for ASCO but I would expect that they would have some amount of data to discuss.

2013 would lead to submission for that indication in 2014. Then in 2015 we would expect to be seeing data coming out across other indications. At ASCO, Roche indicated that they would be moving forward across a pretty broad spectrum in the adjuvant setting. So they have a new adjuvant study that that will begin at 2013 in adjuvant study, as well as a study for patients post-surgery with residual disease. So, all of the studies will start next year. They have indicated that the data will read out from the new adjuvant study in 2015. So that will be the first opportunity for them for a submission in the adjuvant, in some dimension of the adjuvant setting.

And then also there is a gastric study that’s underway. As you know, Herceptin is approved in first line HER2-positive gastric cancer in combination with taxane. This would be for patients, later stage patients, and it’s comparing both T-DM1 as well as T-DM1 plus pertuzumab against the standard of care for latters’ disease, which would be against the taxane. So, the indication is that that study would read out in 2015. So, I think we will just see ongoing data coming out relative to this compound to broaden the label after what I presume would be an approval and hop of the EMILA data.

Marshall Urist - Morgan Stanley

Sure. Of course, this is a very strong randomized phase II data behind MARIANNE as well, they are up in the frontline setting?

Daniel Junius

Well, yes. We understand patient population, that data has been – it was extremely strong, I mean, both in terms of – as we saw with EMILIA, very good efficacy, very good tolerability, so I think it does – one way to anticipate you would see comparable data coming out of MARIANNE.

Marshall Urist - Morgan Stanley

Definitely. I think one other interesting kind of earlier, much earlier stage sort of asset in T-DM1 that someone talked about have been either lower levels of HER2-positivity or people who might not meet the threshold for treating with Herceptin or the current definition of HER2 positivity. So, I think that’s something that’s gotten less attention. When might we start to learn a little bit more about the potentiality and more there?

Daniel Junius

Yes, that’s one. Roche really hasn’t talked about that. I find it intriguing because particularly when you look at – when you think about the EMILIA data, where you are dealing with later stage patients, the progression free survival showed about 50% improvement in that patient population against a control arm that had a 23 months survival level. You saw the data at ASCO that suggested 2 years, you had a dramatic improvement in survival in the viable patients in 2 years and now the top line data that says that they had achieved statistical significance. It does pose the question if you have a much larger patient population as you go to the HER2 normal patient, as opposed to the 3+ expressers, but it’s not one that Roche has chosen to pursue thus far. Whether they affirmably take that up on their own or that becomes a function of investigator initiated studies remains to be seen, but I do think either with T-DM 1 as monotherapy where you have seen very strong data, or as we learn more about T-DM1 in combination with a variety of agents be it pertuzumab, be it with taxane, be it with a number of other agents that are being pursued, it would seem to offer some potential for that patient population. But there is very little data to support it.

In an early study, Roche had seen – they disclosed that when they took some data and went and verified HER2 positivity at a central lab, they had a different array of patients than those determined by the investigator. And what they found was a meaningful proportion of patients who were confirmed to be HER2 normal as opposed to 3+ expressers. There was some level of activity in those patients, about 15% response rate. So, it wasn’t overwhelming, a very small hand, but it is intriguing when you think about both T-DM1 as potential monotherapy for those patients. Again, given the balance of efficacy and tolerability but then also offering in combination.

Marshall Urist - Morgan Stanley

Definitely. Interesting. So, maybe let’s switch gears and talk about the pipeline a little bit as well. You alluded to in your opening comments that we did just see some early kind of endorsing data from 901. So, how does that set us up looking to the second phase of the north study in terms of the biggest conclusions from the Chicago data. I know it’s very early, but is there anything you can tell us about duration, the duration of response in those patients.

Daniel Junius

It’s too early. We don’t have duration. It’s both too early and the study wasn’t structured to collect duration data, given the nature of the patient population. It’s intriguing. We are going to go back and see if we can pull that together and what it might tell us. I think that what I would draw from the Chicago data was very encouraging around tolerability. It was our thesis going in based on pre-clinical work that we have endorsed 901 in combination with these agents and get it to its therapeutic window. Given the fact that we were able to get it to where we did in monotherapy and we had some interesting data in our monotherapy studies that was very encouraging.

I think the other element that as you look at we called out the 13 small cell lung cancer patients that were there, as I noted three of them being first line and we had two of those to respond, but again that’s too small to be meaningful. But of the other 10, the other 10 had received earlier platinum-based therapy. We saw activity in those patients. Some of those patients were platinum resistant. We saw activity in those patients. So, again, it’s too small of a number to draw any firm conclusions. But what it said to me was that we have made the right decision looking at 901 in this patient population. There is a reason to be encouraged that as we go in we see first line patients versus this patient population that there is the opportunity for us to have 901 contribute to benefit to those patients. So, now we push enrollment. One of the things that we are seeing with our investigators that’s actually kind of interesting is, you think of oncologist to some extent is being somewhat monolithic and they are aware of everything going on in the field. But the reality is the lung cancer oncologist don’t know what’s going on in women’s health. So up until ASCO there was zero awareness of T-DM1. So now what we are seeing is they become aware of the opportunity for ADCs in particular in solid tumors, you are seeing increased enthusiasm that this may offer an alternative for their patients and be part of the phenomena that that has been seen in HER2 positive patient population.

Marshall Urist - Morgan Stanley

And further north of study does have an interim analysis, so what are your updated thoughts on when we could get there and how are you thinking about the hurdle from the interim look?

Daniel Junius

Well, the wins easier, well both are easy, but we haven’t disclosed what the hurdle is. We think that by the back half of 2013 we should have some pretty good insight half of that first cohort of 59 patients. That was set up for a variety of reasons. One is to let us have this early understanding as possible what progress we are making in the study. And that’s very important because it should enable us to do some things to compress the time line of getting to a pivotal study. If you contrast 901 for example with T-DM1, with T-DM1 Trastuzumab being a marketed antibody as receptor, that was available in vast quantities that had gone through all of the scale up to validation, etcetera. 901 not being marketed as a naked agent, we have some work to do to get that to scale, to think about validation and think about pivotal studies. So carving on this 59 patients we would hope will give us the insight to make decisions, make incremental decisions. We have already made some, we are doing some work but at a somewhat more modest level of what will be involved for us to put the material together to be able to support a pivotal study.

Marshall Urist - Morgan Stanley

As you think about what the regulatory path in small cell looks like, what’s your current thoughts on what is an approvable end point in phase III? Does a front line phase III study have to be an overall survival trial and how are you thinking about that versus making decisions based on response rate and PSS potentially from the in-room analysis.

Daniel Junius

Yes, as you go across the spectrum, I am not sure the response rate will be informative because patients do respond quite well in the first line therapy. So, even increased response rate is only going to show, I would think some marginal level of improvement. Whether the regulators would look favorably on PFS as a surrogate endpoint versus overall survival remains to be seen, I think that it maybe becomes a little bit less critical of an element in a disease of this nature where unfortunately the difference between PFS and overall survival with existing therapies, it’s not that great.

Progression-free survival for small-cell lung cancer patients with extensive disease is less than six months overall survival is under 12 months. So, they aren’t that far apart.

Marshall Urist - Morgan Stanley

Sure. Great. So, and then, longer-term strategically, what’s your thought on 901? Is this something that you feel like ImmunoGen could take forward alone or would it be something you might look to partner and maybe reinvest in the rest of the pipeline?

Daniel Junius

Well, I think there is an avenue for us to do both. When I think about the opportunity for ImmunoGen, we think that there is significant opportunity with proprietary products. 901 is one, and I will come back specifically to address that, but we are looking at. The other two compounds we have clinically, a fourth compound that will be proprietary that we intend to bring into clinic sometime during the course of 2013, and I think again has some very interesting aspects. So, as we think about the development path for 901, a number of factors come into play. One is that the small-cell lung cancer is not the only indication where CD56 is expressed.

And so, when you think about development, there is the opportunity to develop across the spectrum that’s expressed on multiple myeloma, we have seen some interesting data there. We have submitted an abstract for data off of a combination study that we have been conducting single arm with 901 in combination with Lenalidomide and Dexamethasone. It’s expressed on a variety of neuroendocrine tumors. It’s (inaudible) it’s an ovarian. So, you want to think about what may be involved in a comprehensive development plan. And so, you don’t want to be thinking just narrowly around small cells. So, when you think of it in those terms, it encourage you to think in terms of partner, but partner can be defined a number of ways. Partner isn’t necessarily gaining global rights and retaining simply a milestone royalty relationship, you can bifurcate geographies and something where we retain development rights in, say the U.S., North America, something of that nature and engage a partner at appropriate economics for development ex-U.S. can make sense in terms of optimizing the value of that particular compound.

Marshall Urist - Morgan Stanley

And do you think that’s something that is a decision you would feel comfortable making after the first cohort of patients from north, or would it be, you know, you would want to have a mature, sort of a mature dataset?

Daniel Junius

Well, we think we have the resources financially to being able to take 901 as well as our other two, doing the clinic 529, 853 to proof of concept. Proof of concept is a little bit of a moving target as you well know. You know, proof of concept may well be clear after the first 59 patients cohort, we may need to see the full dataset. So, but again, I think that given the financial dynamics both in terms of our current balance sheet, what we think that the opportunity is for revenue from existing partners hopefully seeing royalties from T-DM1 give us the flexibility to being able to take it to the proof of concept if that’s the appropriate action.

Marshall Urist - Morgan Stanley

Sure. So, maybe kind of working on a couple of your earlier-stage pipeline assets, touch on 853 as well. So, there is one where there is another opportunity from maybe some early proof of concept. So, first of all, what do you take away some of the work that’s been done in the kind of Folate receptor area so far in terms of validating that target, and how you think 853 is sort of a differentiated take on that, on this pathway?

Daniel Junius

Yes, the works that’s been done there with another Folate receptor targeted compound I think is very encouraging from a target standpoint, because there are a target nuances that sometimes you don’t get to fully understand until the compound goes into clinic. So, seeing some of the data coming out in that space has been certainly encouraging. We think that the offering that we have is again, as I mentioned was 529 differentiated, dealing both with how we are going after the target as well as the construct of the ADC. The fact that we are using an antibody as the targeting vehicle, we end up going to an epitope different than vitamin [ph] folate, which is the carrier for the compound you are referencing, and I think that, that therefore we are not competing with dietary folate, and as a result, we would think that we would get better coverage of the cell with our approach as opposed to using folate as the carrier.

And I go back to the preclinical data, and whether the preclinical data is function of the target or whether there has been meaningful contribution from the new linker that we have developed or potentially of the antibody, because our understanding of how different antibodies can function, some can function very well as a naked agent, but they may not be the best antibody to service as an ADC. So, our understanding there in selection of the antibody may be a contributor as well, but irrespective, probably it’s some combination of all of the elements. The preclinical data for 853 was extremely compelling, and so, we are in the clinic, we have an aggressive protocol that’s been accepted by the FDA that lets us look at single patient cohorts at the early stages until we get to higher levels. That should let us move to a therapeutic dose more rapidly than we might under a different protocol, and so, we think we are gaining some insight pretty quickly.

Once we get to the MTD, we already have indications specific expansion cohorts in place looking at a couple of ovarian arms and one in small-cell lung cancer. So, we will move very quickly from getting through the early safety assessment into further safety, but also efficacy assessment on a disease-specific basis. And a couple of the arms are going to be doing some work in looking at biomarkers. And so, I think this in many ways is probably our best design study thus far with what we think is a very interesting compound.

Marshall Urist - Morgan Stanley

So, then how you see the development in past coming together? You know, you get to some of these expansion cohorts, I think (inaudible) ways to go. What’s on the other side of that in terms of how you guys are thinking about Phase II, Phase III as next steps?

Daniel Junius

Well, we put these studies in place specifically like that to get as quickly as we can to a pivotal study, to a registration study. And in the same way that we have looked at 901, making some early decisions, some early investments to compress the timeline to get ourselves to a pivotal study. We have done the same with 853. So, we are making some investments there around pivotal antibody looking at a pivotal conjugation process because they really are two steps. With T-DM1, we had a manufacturing process for T-DM1 to support their earlier-stage studies, but we also put together got Genentech at the time, a process that they delivered then to a CMO to support their large-scale studies.

We have a conjugation process for early studies. We have done the work and we will be working with the CMO to get them prepared for pivotal scale. We are metering how the spending here to ensure that we are not getting ahead of ourselves, but we are also making some investments, as I said, to compress the timeline. The plan would be coming out of the disease specific expansion cohorts to be able to then move with that data and have a discussion with the regulators and assuming we have compelling data be able to then initiate a registration study in one more indication.

Marshall Urist - Morgan Stanley

Great. And then, on the CD37 program, gotten a little bit less attention, but there is actually some reasonable proof of concept I think from other programs in CD37. So, how are you thinking about that program and when could we see some of the early temporarily response rate or proof of concept there?

Daniel Junius

Yes, I think that’s probably again a 2013 event. That’s in the clinic. Moving along, it’s a little bit tougher because of so many competing protocols and higher quality existing therapies for non-Hodgkin's lymphoma patients. So, investigators are a little bit slower to be able to pull patients into those studies, but I think we will make enough headway to update on that in 2013. While I would say a competitive way, the reality unfortunately is that non-Hodgkin's lymphoma patients do relapse even with existing therapies, the existing therapies, I don’t think offer the benefits available from an ADC approach and that they are often even Rituxan is dosed in combination with traditional chemotherapeutics. So, from a tolerability standpoint, there are issues there or there are opportunities to potentially develop better therapeutics that can offer comparable or better efficacy with strong tolerability similar to what we have seen with T-DM1.

Marshall Urist - Morgan Stanley

Great. And then, maybe one more partner program, it’s 3419,and do we know which are the sort of first Phase II studies that will read out and after some interesting data, certainly at ASCO, when might we now see some of the first results of the Phase II?

Daniel Junius

That’s not clear. I mean, Sanofi has been working on those. They are looking at both patients with diffuse large B-cell lymphoma as well as acute lymphoblastic leukemia. When exactly that will read out, we are hopeful we might see something before the end of the year. That’s not clear at this point. If not, I think that, that would probably end up waiting until ASCO next year.

Marshall Urist - Morgan Stanley

Got it. And with that, we are out of time. Dan, thank you. Thanks everyone for joining us this morning.

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