XOMA's CEO Discusses Safety and Efficacy Study of Gevokizumab in Patients With Non-Infectious Uveitis Currently Controlled by Systemic Treatment Conference Call (Transcript)

| About: XOMA Corporation (XOMA)

XOMA Corporation (NASDAQ:XOMA)

XOMA Initiates Safety and Efficacy Study of Gevokizumab in Patients With Non-Infectious Uveitis Currently Controlled by Systemic Treatment

October 03, 2012 04:30 pm ET

Executives

Fred Kurland - Vice President, Finance and Chief Financial Officer

John Varian - Chief Executive Officer

Paul Rubin - Senior Vice President Research and Development and Chief Medical Officer

Analysts

Simos Simeonidis - Cowen & Company

Matt Kaplan - Ladenburg Thalmann

Megan Dow - MLV & Company

Operator

Good afternoon, ladies and gentlemen and welcome to the XOMA Corporation's Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session with instructions following at that time. (Operator Instructions). As a reminder, this call is being recorded.

I would now like to turn the conference over to your host Fred Kurland, Chief Financial Officer at XOMA. You may proceed.

Fred Kurland

Thank you, operator. Good afternoon and welcome to XOMA Corporation's conference call to discuss our global Phase 3 gevokizumab program. Certain statements contained in this press release including but not limited to statements relating to anticipated timing of initiation and completion of clinical trials, anticipated size of clinical trials, regulatory approval of unapproved product candidates, future market acceptance and sales of products upon regulatory approval or that otherwise relate to future periods are forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and section 21E of the Securities Exchange Act of 1934.

These statements are based on assumptions that may not prove accurate and actual results could differ materially from those anticipated due to certain risks inherent in the biotechnology industry and for companies engaged in the development of new products in a regulated market. Potential risks to XOMA meeting these expectations are described in more detail in XOMA's most recent filing on Form 10-K and in other SEC filings. Consider such risks carefully when considering XOMA's prospects. Any forward-looking statement in this press release represents XOMA's views only as of the date of this press release and should not be relied upon as representing its views as of any subsequent date. XOMA disclaims any obligation to update any forward-looking statement except as required by applicable law.

I'm joined today by John Varian, our Chief Executive Officer, and Paul Rubin, our Senior VP of R&D, and Chief Medical Officer.

I'll now turn the call over to John.

John Varian

Thanks, Fred, and thank you everyone for joining us today. Before I start, I would like to direct your attention to the Investor Relations page on website. There you will find a PDF that has four slides outline the design of the EYEGUARD study, which might be helpful to look at as we talk to the program.

We felt it would be beneficial if we hosted a conference call today to give you the overarching view of our Phase 3 program for gevokizumab in noninfectious uveitis, and how these three studies EYEGUARD-A, B and C fit together into an overall program, which we believe positions us well from both, a developmental and commercial standpoint.

We will walk you through our Phase 3 study in controlled NIU patient named EYEGUARD-C, and provide a little more detail on the recently launched study run by Servier and Behcet's uveitis patients named EYEGUARD-B. Patients often arrive at physician's office with active NIU disease that requires immediate treatment to control symptoms. The active disease is treated both, the patient and physician want to maintain the disease in a quiet state over the long-term.

Today, physicians have to resort to high-dose corticosteroids and immunosuppressives to aid them, but both carry long-term health consequences. The most resounding message we've heard from our conversations with physicians during our planning phase has been given a drug that lets us get our patients off high-dose corticosteroids. They know the long-term health consequences these patients face by taking these drugs, yet they face the daily battle to keep the patients' disease out of control due to the consequences that can occur as a result of the active uveitis disease.

Our EYEGUARD program is designed to evaluate whether physician can use one compound. They can treat the active disease then keep it controlled while allowing them to reduce or potentially eliminate the corticosteroids that are typically required to control the disease. We believe there are significant incremental values for gevokizumab with this approach.

The Phase 3 study we launched at the end of June, now referred to as EYEGUARD-A is designed to determine gevokizumab's ability to treat active noninfectious intermediate posterior pan-uveitis, and 300 patients who have a vitreous haze score of greater than or equal to 2-plus. We are now enrolling patients at open sites. The primary endpoint for this study is the proportion of patients to see 2 unit improvement in their vitreous haze score day-56. Secondary endpoints acceptance we made at various points throughout one-year of treatment.

The Servier-run Phase 3 study in Behcet's uveitis patients, EYEGUARD-B, is designed to determine gevokizumab's ability to help patients with Behcet's uveitis in experiencing an exacerbation while reducing their steroid dosage. This is a two-part study with the first part focused on the primary endpoint, measuring the time to exacerbation while undergoing steroid tapering schedule, after which patients move into a 12-month safety and efficacy segment. This is followed by a second segment, which is the continued safety study to meet regulatory need for the United States and for countries in which Servier intends to seek marketing approval. These two studies EYEGUARD-A and EYEGUARD-B, are the studies we agree with FDA could form the basis of a BLA filing in the U.S. We believe, we'll have the primary endpoint data from EYEGUARD-A at the end of 2013 and from EYEGUARD-B, approximately one quarter later.

Now let me turn to EYEGUARD-C. EYEGUARD-C evolved from a safety-only study to a safety and efficacy study. As we and our partner Servier were planning for the safety study, we saw an opportunity to get much more from the study than was originally intended. For ethical reasons, the study needed to be in NIU patients who might benefit from gevokizumab rather than healthy individuals.

Since EYEGUARD-A is capturing patients with active disease and vitreous haze scores of 2-plus, our clinical sites would have been enrolling patients with inactive NIU into the safety study. More importantly, our conversations with physicians have made it clear they also need data that demonstrates that gevokizumab can avoid or delay uveitis sector exacerbations in their error NIU patients whom they are trying to wean-off corticosteroids and immunosuppressives. Generating this broader spectrum of data should allow gevokizumab's clinical results to more closely match physician practices.

The EYEGUARD-C study design will evaluate if gevokizumab can allow physicians to reduce the corticosteroid dose currently used to maintain their patients' uveitis in a controlled state. For an incremental investment of $5 million, which is XOMA's share, we have been able to expand our study to placebo-controlled efficacy and safety study. We believe this investment have significant value-creating opportunities for XOMA.

EYEGUARD-A will evaluate the use of gevokizumab for the treatment of active disease and EYEGUARD-C to provide physicians with the data they need to successfully transition their patient off high-dose corticosteroids and onto gevokizumab. We hope you are as excited by today's news as we are.

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

Paul Rubin

Thanks, John, and hello, everyone. Today, I am going to provide you with additional detail and gevokizumab studies. We're excited to pull global NIU and Behcet's uveitis and Phase 3 program is underway. These trial have been designed to meet the regulatory commercial needs for all markets worldwide. As reminder, EYEGUARD-A will enroll three groups of 100 patients with active noninfectious intermediate posterior or pan-uveitis with the vitreous haze score of greater than or equal to 2, plus using the standardization of uveitis nomenclature or some scale.

We will be conducting the study in 100 to 120 centers with an approximately 50-50 split of patients between the U.S. and the rest of the world. These 300 patients who we randomized 12121 to received 30 milligrams of gevokizumab, 60 milligrams of gevokizumab or placebo delivered via subcutaneous injection once every four weeks. The study is powered at 90% to show a p-value of less than 0.05.

Patients who received the total of 14 injections over a 12-month period, while patients will be dose for one year, the primary endpoint as John said, is assessed on day 56. This primary endpoint is the proportion of patients demonstrating at least a 2 unit improvement in the vitreous haze score. To be enrolled in our study, participants must have vitreous haze score in at least one eye of two or higher using this on any eye criteria.

Without any eye scale, ranks the degree of vitreous haze zero to four-point scale. The main objectives of this study are to compare the effective dose of gevokizumab at least one of the two doses to placebo in the treatment of patients with active, noninfectious, intermediate, posterior pan-uveitis and to determine safety over the course of treatment. In addition to gevokizumab or placebo, patients will continue on back on corticosteroids and/or immunosuppressive drugs throughout study.

There are number of secondary endpoints we will be assessing including the proportion of responders at time points other than 56, and mean changes from baseline in vitreous haze score as corrected visual acuity and quality of life assessments. The patient participation in this study will last approximately one year.

I'll now provide some detail regarding the Servier-run EYEGUARD-B or Behcet's uveitis pivotal trial, with the caveat they've request that we keep details to a minimum. The study is expected to enroll approximately 110 Behcet's uveitis patients who have had a recent exacerbation that are not exhibiting signs their disease will on a stable dose corticosteroids.

They will be randomized to 60 milligrams gevokizumab or placebo dosed once monthly, but this is an even-driven study. The study's primary endpoint time to exacerbation will be assessed with a predetermined number exacerbations occur while patients undergo a prescribed tapering of the corticosteroid dose. In the core study, patients will be followed for 12 months after randomization. Assumptions as to the anticipated exacerbation rates for the active and placebo arms were determined based upon prior studies and expert experience. The timing of completion will be dictated based on the enrollment rate and the accuracy of the estimated events rates in the study arms.

Based on the existing assumptions, we would expect data from the Behcet's studies to be available approximately a quarter after our NIU study. We anticipate the successful completion of both trials could allow BLA submission by the second half of 2014. While those are the two studies we agreed with FDA to serve as the basis for our BLA filing, but let's turn to the newly launched study we announced today, EYEGUARD-C. We design EYEGUARD-C to meet physicians desire to be able to keep their patients' uveitis disease under control while reducing or eliminating corticosteroids. The general design is not significantly different from Servier's EYEGUARD-B study. The primary endpoint is the proportion of patients with an occurrence of uveitic disease through day-168. The definition of an occurrence of uveitic disease is based on worsening of the uveitis through retinal vascular lesions vitreous haze score and best corrected visual acuity.

We're enrolling 300 patients in the three-arm study with equal allocations to 30 milligram or 60 milligram gevokizumab or placebo. All patients will be on a dose oral corticosteroids, which will be tapered during the trial with or without immunosuppressives. This study like all others, are powered at the 90% level. The study also includes several secondary endpoints. It is intended to complete the safety database to support the FDA's requirement for BLA filing.

Now as a final reminder, EYEGUARD-A is the title be active NIU study in patients with active disease EYEGUARD-B, is the Behcet's uveitis study and EYEGUARD-C is the NIU study in patients with controlled noninfectious uveitis. We believe that with this comprehensive approach to the development of gevokizumab in uveitis, we can potentially address several unmet medical needs and offer an alternative approach to treatment.

I will now turn the call back over to John.

John Varian

Thanks, Paul. So, in inclusion, before we turn the call over to questions, it's been a little over a year since I joined the day-to-day operations here at XOMA. Our team as well as their colleagues at Servier have accomplished a great amount in a very short period time. Our entire purpose is to ensure we invest in and successfully execute value creating activities that can improve patients' lives. That focus is reflected in this expanded program, which we were able to achieve with an incremental $5 million cost to XOMA.

Today, we have patients enrolling in three pivotal gevokizumab studies that are being conducted around the world in orphan indications. I'd like to thank the entire team here at XOMA, for the dedication to getting up to this point. I'm excited about opportunities that lie ahead the company.

Operator, we will take questions now.

Question-and-Answer Session

Operator

Thank you, ladies and gentlemen (Operator Instructions). Our first question is from Simos Simeonidis from Cowen & Company. Your line is open.

Simos Simeonidis - Cowen & Company

Hi, guys. Thank you for taking the question. Just to be clear, this third Phase 3 study that was originally just the safety study and you are converting to get efficacy data was not requested by FDA or EMA, and you are not going to have to wait for these data to readout before you file. Correct?

Paul Rubin

That's absolutely correct. This was the decision made solely by Servier, and us here at XOMA. We want to have a qualitative explain, but it's actually a pretty simple conclusion. We have the safety study that we needed to do. It was going to be in NIU patients, we saw the ability to convert it to a an additional efficacy study and it gives us data that's really important commercially when it comes to how physicians actually treat patients. When it comes to when we will be able to file for the BLA, it's when whichever two of these studies are available would be the time when we'd be able to actually do the filing with FDA.

Simos Simeonidis - Cowen & Company

So, all three studies could service. I should say any two of the three studies could serve as pivotal trials for submission?

John Varian

Yes, Simos. As far as we know that that is the case. There is nothing different between this program and any other program according to FDA regulations, so we need two pivotal trials to be successful in order to submit our BLA.

Simos Simeonidis - Cowen & Company

Okay. Great. Thank you for taking the question.

John Varian

You're welcome.

Operator

Thank you. Our next question is from Matt Kaplan of Ladenburg Thalmann. Your line is open.

Matt Kaplan - Ladenburg Thalmann

Hi, guys. Thanks for doing the call today. Just in the update, could you give us an update in terms of how the I guess the EYEGUARD-A study is enrolling so far? Is that on schedule?

Paul Rubin

So, Matt, we want to have this call today to make sure there was understand how the studies fit together. We as practiced at the quarterly calls, give updates on the clinical studies, and so we want to have this call focused solely on the studies themselves, so we will give update in a standard way at the quarterly calls, so this call is really about the study design today. If that's okay.

Matt Kaplan - Ladenburg Thalmann

Okay. Fair enough. I guess, with respect to, Servier just announced that they initiated their study and now that the third stage is ongoing there seems to be a good level of overlap in terms of the design the Servier study and Behcet's, and here is in terms of the third, C-study, in terms of design, could you elaborate a little bit more on that? Are they both using this tapering type of design?

Paul Rubin

Yes. In both cases the studies are designed to provide ultimately physicians with data that allow them to successfully as John alluded to taper patient off corticosteroids and transition to gevokizumab, so in both cases patients will be essentially quiescent although they have a history of exacerbations on a fixed dose of corticosteroids and then they will be fixed taper in both cases according to the same criteria.

Matt Kaplan - Ladenburg Thalmann

That's great. And then how does it work if they are on immunosuppressives as well as and corticosteroids, do you randomized the balance beyond to account for that and are those tapered as well?

Paul Rubin

No. Any medication that is not a corticosteroid will be kept at a constant level during the observation period for the primary endpoint.

Matt Kaplan - Ladenburg Thalmann

And generally what percentage of patient are in the immunosuppressive in addition to the steroids.

Paul Rubin

I can't do specifically, but I would say a majority of the patients will be on both, steroids as well as on immunosuppressives.

Matt Kaplan - Ladenburg Thalmann

I guess with these three studies since the patient populations are different, there shouldn't be so-called competition for patients in any of the sites?

Paul Rubin

Yes. These, I think, are complementary in terms of potential patient for enrollment.

Matt Kaplan - Ladenburg Thalmann

Will the sites also overlap a lot of those?

Paul Rubin

Yes. In almost all cases the same sites will be enrolling all studies. For NIU, they will be in United States. The exception is the United States will not be doing Behcet's trial.

Matt Kaplan - Ladenburg Thalmann

Great. Okay. Well, thanks again for taking the question and the update.

John Varian

Thanks, Matt.

Operator

Thank you. Our next question is from Megan Dow of MLV & Company. Your line is open.

Megan Dow - MLV & Company

Hello, everyone. Thank you so much for taking the call. Congratulations on extending out the trial. Thanks to be able to see such a larger amount of data and being able to be pulled from what was originally a safety study.

Fred Kurland

Thank you, Megan. It's nice to speak with you.

Megan Dow - MLV & Company

Pleasure talking to you guys. I just had a couple of questions. Obviously things that we are all looking forward to are already asked such as enrollment and what not, but I have two questions. First is clinical and second one is going to be for Fred. So, first let's go with clinical. Are you guys going to have an upper limit for how much steroid these patients are going to be on in order to do the taper? Just can you expand a little bit on that tapering process?

Fred Kurland

Yes. That's a really good question. There actually is no upper limit and we went kind of back and forth this. You we don't anticipate that there will be too many patient higher than, say, a 60 milligram somewhere along those lines, and even that would be very high. We think the majority of the patients will be at around 20 milligrams or plus steroid.

Megan Dow - MLV & Company

Okay. So, then beyond my guess standard [pack] tapered on per month or six months?

Fred Kurland

Yes. Well, it's according to [Jarvis] criteria, so it really depends upon what their baseline corticosteroids doses.

Megan Dow - MLV & Company

Okay. Is there an opportunity for those patients to actually increase their core don't improve…

Fred Kurland

To…

Megan Dow - MLV & Company

Once the taper begins, is there an opportunity for the patients to opt those?

Fred Kurland

No. They can't increase the dose of corticosteroids. If they exacerbate then that's essentially the even that ends the study.

Megan Dow - MLV & Company

Okay. All right. Perfect. And then the second question, you mentioned there is going to be a $5 million investment for expanding those (Inaudible) to be able to take advantage of the same site from the same physician? I was wondering how this is going to be able to affect your cash burn guidance moving.

John Varian

I just want to correct myself. I have got those studies confused. In this particular trial, there is an upper. It's 25 milligrams.

Megan Dow - MLV & Company

25 milligram, so you are going to be excluding Servier.

John Varian

Yes. The patient that are above 25 will not be allowed to participate. I apologize if there's any.

Megan Dow - MLV & Company

That's fine. I mean, typically those patients have comorbidities you don't want to deal with anyway, so that's good. Yeah. You don't want to deal with them. All right. Perfect. And then, what about the burn and the burden this is going to. You mentioned the $5 million investment from XOMA, so is this is going to be affecting you guys operating…

Fred Kurland

This is Fred, Megan. Not in an appreciable way. Of course $5 million is $5 million, but our projections have in the past been that with the advent of our of our financing completed last March that we had enough cash given our projections to have cash well into, but not all the way through 2014, and that's essentially unchanged. As a parallel matter and just by coincidence, we also this afternoon filed an 8-K with the SEC acknowledging an amendment to our loan with General Electric Credit Corporation in which we've increased the size of the loan by approximately quite coincidentally $5 million. I don't want to connect that so closely between those two. They are quite independent event.

Megan Dow - MLV & Company

All right. great. Thank you very much, Fred.

Operator

Thank you. I am showing no further questions at this time. I would like to turn the call over to management for any closing remarks.

John Varian

Well, thank you operator, and thank you everyone. Before I sign off, I hope we have effectively communicated the importance of the decision we have made. While we could have proceeded with the standard supplemental safety-only study, we decided to expand our study to an efficacy and safety study for an incremental investment of $5 million, and as you have just heard we've also put in place of expansion of our GE loan for very similar amount, which put us back into a very similar position that we were in going into those two decisions.

We believe this investment has significant value creating opportunity for XOMA and its shareholders, and eventful medical community for this unmet indications, so just again we want to have this call to make sure that we were able to answer these questions, but again it was a, we think we don't want to call it a no-brainer, but it really was I think a fairly simple decision between us and our partner that we could take advantage of a lot of work that needs to be done from a safety-only standpoint. And, again generate the data the physicians really need to treat the broad-spectrum patients that come into their offices.

So, thanks again for everyone joining our call, and we look forward to giving you updates on all the other matters during our standard quarterly calls. Thanks bye, bye.

Operator

Ladies and gentlemen, thank you for your participation in today's conference. This concludes the program. You may now disconnect and have a wonderful day.

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