CymaBay Therapeutics (CBAY) CEO Sujal Shah on Q2 2018 Results - Earnings Call Transcript

About: CymaBay Therapeutics (CBAY)
by: SA Transcripts

CymaBay Therapeutics (NASDAQ:CBAY) Q2 2018 Earnings Conference Call August 9, 2018 4:30 PM ET


Dan Menold - Vice President, Finance

Sujal Shah - Chief Executive Officer

Pol Boudes - Chief Medical Officer

Chuck McWherter - Chief Scientific Officer


Yasmeen Rahimi - ROTH Capital Partners

Tyler Van Buren - Piper Jaffray

Jay Olson - Oppenheimer and Company


Good day, ladies and gentlemen and welcome to the CymaBay's Second Quarter 2018 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we will open the call for your questions. Please be advised that the call will be recorded at the Company's request. It is also being webcast live on the Investors Section of the CymaBay website at

Now, I would like to turn the call over to Mr. Dan Menold, Vice President of Finance at CymaBay. Mr. Menold, please proceed.

Dan Menold

Thank you, operator, and good afternoon, everyone. Earlier today, we issued a press release announcing our second quarter 2018 financial results and business update. You can access that release on our website under the Investors tab.

Joining me on the call today are Sujal Shah, Chief Executive Officer, Dr. Pol Boudes, Chief Medical Officer and Dr. Chuck McWherter, Chief Scientific Officer. They will provide an update on our financial position and clinical programs and review upcoming milestones before we open up the call for Q&A.

Before we begin, I would like to remind everyone that statements made during this conference call, including the Q&A session relating to CymaBay's expected future performance, business prospects, events or plans including clinical plans are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995.

Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, actual outcomes and results are subject to risks and uncertainties and could differ materially from those forecasts due to the impact of many factors.

The Company assumes no obligation to update or supplement any forward-looking statements whether as a result of new information, future events or otherwise except as required by law. Participants are directed to the cautionary statements set forth in today's press release, as well as the risk factors set forth in CymaBay's Quarterly and Annual Reports filed with the SEC for factors that could cause actual results to differ materially from those anticipated in the forward-looking statements.

This call is a property of CymaBay and any recording or rebroadcast is expressly prohibited without the written consent of CymaBay.

At this time, I would like to turn the call over to Sujal.

Sujal Shah

Thank you, Dan, and good afternoon, everyone to all of you joining us on the call today. I'll keep my opening remarks brief with a review of recent activities and key upcoming catalyst before we take questions. I'll focus on three things that were central to the progress we made in the second quarter and we remain significant driver of near-term growth including first, further clinical de-risking of seladelpar in Primary Biliary Cholangitis or PBC. Second, advancement of regulatory dialog informing our pivotal Phase 3 PBC study design and finally diversification of seladelpar development with the initiation of a Phase IIb study in patients with NonAlcoholic SteatoHepatitis or NASH.

First, as a recap from our first quarter call. 12 and 26-week data from our ongoing Phase II study of seladelpar in patients with PBC were highlighted in a late breaking presentation at the International Liver Congress in 2018 hosted by the EASL in Paris last April. We believe these results establish that the doses of seladelpar could be used in Phase 3 exhibit anti-cholestatic and anti-inflammatory activities with favorable tolerability and safety that would provide potential advantage over current second line treatment for PBC.

As we announced at our Analyst and Investor Day in June, we completed enrolment with over 100 patients enter into the study, a significant achievement over a relatively short period of time in an orphan disease such as PBC. We are very encouraged that all of the first 40 patient completing one year of treatment elected to remain on seladelpar treatment in a long-term extension study.

In the fourth quarter, we plan to provide an expanded set of results from this ongoing Phase II study, including from those patients completing 52 weeks of treatment. As a reminder, 52 weeks is a key regulatory timepoint as it represents the duration of treatment at which the primary endpoint in the Phase 3 study is measured. We believe this study continues to provide key risk benefit information about seladelpar and will make an important contribution to regulatory submissions planned at the conclusion of Phase 3 development.

The second area of focus in Q2 was centered on our interactions with regulatory agencies in the US and Europe, to finalize a design for our planned Phase 3 study of seladelpar in PBC. We will target a label in the second line treatment of PBC that would support a profile demonstrating improved efficacy and better tolerability than Ocaliva the only currently approved second line treatment for PBC. We have been pleased with the FDA and EMA's level of engagement that we believe reflects the need for improved therapies for patients with PBC.

During our Analyst and Investor Day, we highlighted our plans to proceed with a double-blind placebo-controlled Phase 3 pivotal study in which approximately 240 patients will be randomized to receive either placebo or one of two dose regiments of seladelpar either 10 milligrams or 5 milligrams with the potential to increase the dose to 10 milligrams after six months for those patients that have not yet met the primary endpoint.

The primary endpoint will be the same responder rate used in the pivotal study of Ocaliva, specifically a responder is designed a patient achieving an alkaline phosphatase or AP level below 1.67 times the upper limit of normal with at least a 15% reduction from baseline and a normal total bilirubin at 52 weeks.

Key secondary endpoint will be AP normalization rate and changes in pruritus as measured by the numerical rating scale of NRS. We are actively working on global initiation activities and remain on track to start this study in the second half of this year. Finally, in addition to the progress we've made in PBC, we announced in May that we initiated a Phase 2b proof of concept study of seladelpar in patients with NASH. This study is a randomized double-blind placebo-controlled dose ranging study that is intended to enroll approximately 175 patients with liver biopsy proving NASH at US investigational centers.

We are enrolling non-cirrhotic NASH patients with a liver fat content above or equal to 10%. A NASH activity score or NAS superior or equal to 4 and a liver fibrosis stage from 1 to 3. Seladelpar at doses of 10, 20 and 50-milligram taken once daily will be evaluated versus placebo. The primary efficacy outcome will be the change from baseline and liver fat content at 12 weeks as measured by magnetic resonance imaging using the proton density fat fraction method or MRI-PDFF.

Among the secondary measures of efficacy is the evaluation of histological improvement in NASH and fibrosis as accessed by comparing liver biopsy samples taken at baseline and 52 weeks. Additional planned assessments include MRI-PDFF measurements at 26 and 52 weeks of treatment as well as the use of the latest innovative bio-chemical markers and non-invasive imagine that reflects liver inflammation and fibrosis. We are closely collaborating with Dr. Stephen Harrison, Medical Director of Pinnacle Clinical Research. The coordinating investigator for this study and a world-renowned NASH expect.

Although it is still early, we are very encouraged by our experience thus far and expect to be able to provide additional guidance on timelines for the study in the very near future. As we enter the second half of this year, we are extremely pleased with our progress in both PBC and NASH. At the end of the second quarter, we had $212 million in cash, cash equivalents and short-term investment and continue to believe the support our current operating plan into 2021, which includes funding of our pivotal Phase 3 study in PBC and Phase 2b study in NASH.

With a strong balance sheet and key operational objective in PBC and NASH progressing well, we continue to evaluate additional areas of development for seladelpar as well as other programs in our pipeline. Our activities to-date have been focused on evaluating the scientific and clinical rationale. The understanding of the unmet medical need and having ongoing discussion with thought leaders in an effort to identify and establish potential future areas of development for seladelpar and other pipeline programs in various indication. We look forward to seeking more about these additional opportunities as are planned for formalized.

Thank you again for joining us today. We would now be happy to take your questions. Operator?

Question-and-Answer Session


Thank you. [Operator Instructions] Our first question comes from Yasmeen Rahimi of ROTH Capital Partners. Please go ahead.

Yasmeen Rahimi

Hi team. Congrats on the continued progress. Question goes to Pol. Can you provide us some insight on how pruritus is measured in the open label Phase 2 trial versus Phase 3, what is the same and what is different?

And maybe also elaborate on why did you decide to measure pruritusin your upcoming Phase 3 of six months versus 12?

Pol Boudes

Hi, thanks for the question. So, the alterable extension we are now using the same evaluation we have the visual analog scales and we have the classical instruments the 5 PH score. The difference from the first half of the study is that we are not having as much evaluation compared to the beginning of the study.

Now for the Phase 3 study, we're going to use something that is a little bit different from the VAS that is very much correlated with the VAS. The VAS goes from 100 and we're going to use a numerical scale which is a one to ten scale where basically you have to pick on which level you are and we are going to do that with an electronic process. So that's the difference with the Phase 2 program.

And in terms of - I think the last part of your question was six months versus 12. We are going to do the six months analysis is going to be the primary analysis, if you want for fibrosis. But we are also going to measure the data at month 12.

Sujal Shah

And Yasmeen, I can also add that if you look into published literature, the VAS and the NRS are extremely well correlated over 99%. So, it's a difference between a visual scale of zero to 100 and a numerical rating scale of zero to 10 that's the system of verbal assessment. We've certainly done a fair bit of work around the PRO ourselves in terms of listening feedback from patients around both frequency and the methodology to make the measure all of that is incorporated in the design for the Phase 3 study.

Yasmeen Rahimi

Thank you, Sujal. As I may ask one follow-up, you mentioned during your Analyst Day that you are thinking about defining another study with PBC patient with advanced disease. Can you give us some color how the trials would look like on regards to size exact patient population and maybe a little bit of color on the timeline around that?

Sujal Shah

Yes, I think at this stage it's a bit premature for us to give specific guidance around how the study would be designed. I think we talked more specifically about really the purpose of this study. The severe PBC population is very different from the broader population that have been studied in both Phase 2 and Phase 3 clinical trials for Ocaliva and thus far in our clinical experiences well.

And really, the key difference here is taking a very different approach from our predecessors in this population recognizing there is an importance in understanding exposure, there is an importance in understanding proper safety and dosing regimen for what is a much more severe patient population and recognizing that there is an intent from our perspective in truly understanding that with benefit in this population.

So, from a high-level perspective the idea is to do something very measured and careful in the advanced population in order to give us the information necessary to truly inform the overall label for seladelpar. So, discussions with the agency in studying this population remain ongoing and we will look to give some further detail as those discussions progress.

Yasmeen Rahimi

Thank you, team.

Sujal Shah

Thanks Yasmeen.


Our next question comes from Tyler Van Buren of Piper Jaffray. Please go ahead.

Tyler Van Buren

Good afternoon. Thanks for taking the questions. So, we're clearly seen positive results in reduction of AP in 12 and 26 weeks. So, could you just give us your updated thoughts on the 52 week data and what you are hoping to see with respect to that and how it may translate to responder rate and ultimate Phase 3 study success?

Sujal Shah

Sure, maybe I'll start and perhaps the rest of the team can jump in. Without question as you mentioned we are very encouraged by what we saw through the 26 week timepoint with the dataset presented at EASL where at 26 weeks we see reductions in alkaline phosphatase of 45%. We're seeing transaminase decreases in the 40% range and fundamentally the anti-cholestatic effect at least through 26 weeks whether you look at 5 or 10 milligrams coming in around 68% to 79% and we can't compared between seladelpar and Ocaliva as we don't have head to head data.

But if you just think about where seladelpar has been progressing, at least thus far it appears to be demonstrating the potential for improved efficacy and a greater responder rate from that dataset. Even the 5 milligram dose group there had a baseline AP of approximately 348 units per liter which is higher than the baseline AP in the patients that were enrolled in the Phase 3 study. So, very encouraged by the level of response that we have seen through 26 weeks.

What we typically see in the setting and what we want to be able to observe is a response that continues to be sustained between 26 and 52 weeks. With that level of AP decline, and I should mention as many as 25% to 30% of patients actually experiencing normalization of AP through 26 weeks. There isn't necessary the expectations that you continue to see vast increases in AP reduction between 26 and 52. What we want to be able to see and what is typically seen in the setting is the response that continues to be sustained.

It is important for us to also see the same level of anti-inflammatory activity sustained as we saw from 26, 52 weeks and of course every patient that we have more data continues to support the overall safety profile of seladelpar as well. So, that will be another key observation in the 52-week data.

Tyler Van Buren

Yes, just one more question. And then with respect to the NASH program. I guess, in general in terms of reduction in liver fat by MRI, what levels do you think is clinically relevant? Why do you think the mechanism of seladelpar might be differentiated that what we've seen with some of the other compounds and finally enrolling patients with fibrosis stage one through three I guess is obviously more on the mild side as opposed to some of the Phase 3 programs which are enrolling more severe stage three and four patients?

So curious to get your thoughts there.

Chuck McWherter

Okay. This is Chuck McWherter I'll try to respond to that and Pol may want to add on to my comments as well. First of all, what the reasonable level of hepatic fat reduction to expect. I think the champion right now has been NGM-282 and Madrigal both of them coming in more or less around a 40%, 30% to 40% reduction in hepatic fat.

But I think even levels somewhat lower than that could still be interesting because of what seladelpar may have the potential to offer. It's our view and we hear this echoed by other thoughts leaders in the field. It's not necessarily fat per se that you want to reduce. It's more lipotoxic fat that's rated fatty acid that instigate and then perpetuate inflammation and inflammation leading to fibrosis. So, where PPARd stands out we believe in seladelpar in particular it is its ability to be a foundational therapy in NASH by reducing fat via fatty acid oxidation in the liver as well as in peripheral tissue in peripheral [indiscernible] which is a source to track due to shuttling during tracking period as well as its direct anti-inflammatory effect.

On both max phases and cooper cells as well as effects on fibrosis we saw reduction in fibrosis of about 50%. So, just to kind of recap, I think we're - that was really the base to a study seladelpar in this population and we'll find out where we stack up first in our interim results, the primary result in hepatic fat. But importantly at the end of the day, we'll have a 52-week biopsy histology read out which I think will help to link hepatic fat measurement.

In terms of the population that we enroll F1 to F3 it's true in for practicality. You do widen the lens a little bit, but I think that those sponsors that we are going for non-cirrhotic NASH. Typically, the focus on F2 and F3 and we expect in this study to have well over half of our patients F2 and F3 as well.

So, I think at the end of the day where our focus in this study is on fat and NASH pathology, we will be able to get a good read on effects on fibrosis as well. And we expect that the results that we would see on the metabolic and anti-inflammatory features would translate into a more advanced cage pace in anyway.

I don't know Pol you want to comment?

Tyler Van Buren

Will you be able to specifically measure that lifo-toxic fat that you mentioned and see if there is any correlation with improved clinical outcomes?

Chuck McWherter

Yes, that would be terrific if we could do it. We've been able to do that in mice where you can actually sample liver. We did a pretty extensive panel of hepatic lipidomic which we actually published in hepatology communications and we saw strong reductions. Not just in total fat triglyceride, which is arguably benign but in palmitate saturated fatty acids of various chain lines as well as well as mono-infatuated fatty acids and glycerol as well.

So, I think the short answer is no. But we have a strong reason to suspect based upon the fundamental pathway that we are modulating that we would expect that we will have the same effect in human livers.

Pol Boudes

And Tyler one of the question you asked around the differentiation of seladelpar as a potent selective PPAR delta agonist and Chuck talked a lot about some of the metabolic components or the mechanism which we are encouraged by. Another differentiator relative to some of the agents being studied today is that seladelpar has not only effect in the liver, but also in peripheral tissue.

So, if you think about the thyroid hormone receptor beta agonist of Madrigal which is liver direct, elafibranor the mixed PPAR a/d, [indiscernible] effectively liver directed the 60% or more of the fats that ends up in the liver comes from the periphery and PPAR d and particular in seladelpar as expressed seladelpar has action also in post and in muscle.

So, we're enthusiastic about better understanding the differentiation that this feature of the mechanism has as well as the fact that not only do we have these impacts on promoting fatty acid oxidation and the effects that Chuck really outlined, it's known that one of the key effects of FXR and FTS 19 is around the inhibition of bile acid synthesis and we know that seladelpar from our experience in PBC has a very robust impact on inhibiting bile acid synthesis without LBL increases of course.

So, there are some really key elements of differentiation around delta that we're excited to lift the exploring here in the space that we study.

Tyler Van Buren

Thank you so much.

Pol Boudes

Thank you.


Thank you. Our next question comes from Ed Arce of H.C. Wainwright. Please go ahead.

Unidentified Analyst

Hi. Good afternoon this is Matt on for Ed. Given the timing for the seladelpar PBC trial currently being set for 2018. This more likely a September of a 4Q event?

Sujal Shah

With a little bit of precision which we would be excited to update you all on as we get closer to that initiation. I can tell you that all of the activities here internally have been geared towards getting this what is going to be a global study with over 100 centers initiated. So, the progress continues to move very well here internally and we'll make sure and give an update as the study commences.

Unidentified Analyst

Great. Thanks. And then for the recently initiated Phase 2b POC study in NASH. How is the rate or enrolment tracking so far especially given all the current clinical competition?

Sujal Shah

It's early days for us to make any specific comments on enrolment. We don't typically do that in between studies. We've outlined that as our first study in NASH, we're really benchmarking enrolment timelines off the experience of our principal investigator Stephen Harrison, he's worked with both NGM and Madrigal. The study that Madrigal conducted is very similar in design and similar in size to what we're conducting today.

But we look at about an 11 to 12-month enrolment timeline for this study. Things are continuing to progress very well having seasoned as principal investigator has really helped us elevate the attention that this study has been given at the centers that are enrolling patients. So, we couldn't be more pleased at the level of engagement from center.

You are absolutely correct, this is a very competitive space. Every study involved, every center involved in our study of course enrolling patients for other studies as well. But the emphasis on the seladelpar Phase 2b at the centers that have been selected for our study is really I think from my perspective at the top of the list as we move through this program.

So, we feel very encouraged and of course we're no more in the months to come and be able to provide more precision around that timeline.

Unidentified Analyst

Appreciate it and congrats again on the progress.

Sujal Shah

Thank you, Matt.


Our next question comes from Jay Olson of Oppenheimer. Please go ahead.

Jay Olson

Hi guys. Thanks for taking my questions. I was curious about the target product profile for seladelpar and PBC which you described as being differentiated on both efficacy and tolerability. And I was wondering if the secondary pruritus endpoint if you have sufficient power in a study to show a significant improvement versus placebo.

Pol Boudes

Hi Jay, it Pol. I think the simple answer is yes. Based on our previous experience with what we are seeing in the Phase 2 program and based on the size of the trial I think we are confident that the trial is appropriately powered for the right outcome.

Jay Olson

Okay. Thank you for that. And then for Ocaliva there was some long-term biopsy data or PBC patient showing a reduction in fibrosis. Then I was wondering if you were going to be collecting similar biopsy data for PBC patient perhaps in a long-term extension to you Phase 3 study.

Chuck McWherter

Yes, I think the data that Ocaliva represented was very interesting. So, we are going to try to introduce the same kind of things. As you know the medical practice is going away from doing biopsy in PBC patient. But the practice also is valuable depending on the place you are working. And I think it's a very good idea. So, we're going to try to get as much sample as possible.

And as you said, it's going to be top of the study but also the expansion phase because you have to take this partly after three years of treatment.

Jay Olson

Okay. Great. Thanks for taking the question.

Sujal Shah

Thank you, Jay.


Our next question comes from Steve Seedhouse of Raymond James. Please go ahead. Steven your line is open. And at this time, we will just pause one more time momentarily. There are no further questions at this time. I would like to turn the floor back over to Sujal Shah for closing comments.

Sujal Shah

Thank you. As you all know our focus today and through the rest of this year remains on the efficient execution of our pivotal Phase 3 study in PBC as we look to enroll, initiate that study in the second half of the year and our Phase 2b proof of concept study in NASH. In addition, we have worked very hard to put ourselves in a position to begin exploring future opportunities for growth and look forward to providing updates in the next future as these ideas mature.

I could not be more pleased by the effort and dedication put forth by everyone here at the company and the patients in investigators involved in our program. Thank you again for being on today's call.


This concludes today's teleconference. You may disconnect your line at this time. Thank you for your participation.