Idera Pharmaceuticals, Inc. (IDRA) CEO Vincent Milano on Q2 2019 Results - Earnings Call Transcript

Aug. 08, 2019 3:11 PM ETIdera Pharmaceuticals, Inc. (IDRA)
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Idera Pharmaceuticals, Inc. (NASDAQ:IDRA) Q2 2019 Earnings Conference Call August 8, 2019 10:00 AM ET

Company Participants

Vincent Milano - President, CEO & Director

Bryant Lim - SVP, General Counsel & Corporate Secretary

Elizabeth Tarka - SVP & Chief Medical Officer

John Kirby - SVP & CFO

Shah Rahimian - Medical Director

Conference Call Participants

Anupam Rama - JPMorgan Chase & Co.

Gena Wang - Barclays Bank

Swayampakula Ramakanth - H.C. Wainwright & Co.

Michael Ulz - Robert W. Baird & Co.

Robert Driscoll - Wedbush Securities

Operator

Good day, ladies and gentlemen, and welcome to the Idera Pharmaceuticals Second Quarter 2019 Corporate Update and Financial Results Conference Call. [Operator Instructions]. As a reminder, this conference call may be recorded.

It is now my pleasure to hand the conference over to Mr. Vin Milano, Chief Executive Officer. Sir, you may begin.

Vincent Milano

Thank you. Good morning and welcome, everyone, joining us on today's call, and thank you for taking the time to join us to discuss our performance over the first half of this year. We are glad to also have the opportunity to provide updates related to the ILLUMINATE 301 and 204 trials.

Before we proceed further, Bryant Lim, our General Counsel, will apprise you of our potential to make forward-looking statements. Bryant?

Bryant Lim

Thanks, Vin. During this call, we may make forward-looking statements within the meaning of the Federal Securities Laws, which may be identified by words like anticipate, expect, believe, estimate, potential, plan and other similar words. Certain statements regarding our expectations for future clinical trials, the timing and outcome and potential outcomes of clinical studies and interactions with regulatory authorities and potential commercial opportunities are examples of such forward-looking statements. As you know, forward-looking statements are subject to factors that may cause our results and plans to materially differ from those expected. Factors that may cause these differences include those described in today's press release and the Risk Factors section of our annual report filed on Form 10-K for the year ended December 31, 2018. These forward-looking statements speak only as of today, and we disclaim any intention or obligation to update them.

I'll now turn the call back over to Vin.

Vincent Milano

Thanks, Bryant. Joining me on the call this morning are the members of the Idera leadership team, including our newest members, Chief Medical Officer, Liz Tarka; and Chief Financial Officer, John Kirby. I believe it will become quite clear during the course of this update that our team has been extremely focused on execution of our tilsotolimod program during the first half of this year. I'm very proud of this group for their focus and intensity. They have demonstrated that they're advancing tilso through our first pivotal registration trial, ILLUMINATE 301, in anti PD-1 refractory melanoma as well as preparing to test it in other tumor types for patients with limited treatment options.

For our call today, I'll provide a few opening comments and remarks, and then I'll turn the call over to Liz to walk through an update on the tilsotolimod program. John will then provide an overview of our financial results, and I'll return for some closing comments before we open it up to take your questions.

Amongst the updates, Liz will provide details related to several informed modifications we have made to ILLUMINATE 301. We believe these modifications significantly increase the probability of a successful outcome of the trial and the opportunity for tilsotolimod to be a viable treatment option for patients who have reached the stage of their disease where treatment options are extremely limited. Overall, the progress in the ILLUMINATE program has been strong, and execution has exceeded the expectations and time lines that we have set out for you and ourselves. The 301 trial has enrolled better than we had anticipated. We have already accrued 294 patients, putting us on track to achieve enrollment four months ahead of schedule for our original target of 308 patients. This speaks not only to the enthusiasm from investigators and patients and the lack of approved options in the melanoma space, but also for the disappointing results observed with other once promising candidates in this space.

As it relates to ILLUMINATE 204, our Phase I/II trial in anti-PD-1 refractory melanoma, we completed enrollment in the first quarter of this year. As you know, we guided to an update on data from this trial in the fourth quarter of this year. In light of the modifications we are making in study 301, we have elected to accelerate our review of the data, and we'll be providing that update to you today. This preliminary data update includes overall response rate, disease control rate, and for the first time, duration of response and early data on overall survival. We believe the key takeaway is that the preliminary data from the ILLUMINATE 204 trial are congruent with the feedback we have received from the medical community and our advisers related to their expectations of clinically meaningful benefit to patients in this highly challenging indication with limited to no real treatment options.

Earlier this year, we also completed the ILLUMINATE 101 monotherapy trial and presented data from this trial at AACR. We are encouraged by the number of stable disease cases observed across a wide variety of difficult-to-treat tumor types and with patients who, in most cases, have progressed on all prior lines of therapy. In fact, even though the trial has concluded, we have one patient with uterine leiomyosarcoma who continued with durable stable disease. This patient received their first dose of tilso over one year ago and is now continuing under a treatment IND. We also recently learned that we have one patient in our melanoma cohort from this trial who has an unconfirmed RECIST version 1.1 partial response from tilso monotherapy.

The 101 trial has served two objectives: first, confirming tilso's mechanism of action through the translational data; and second, providing safety data for tilsotolimod as a monotherapy. These data also play a key role in strengthening our conviction that this novel approach could be tumor-type agnostic and aided in our planning for the multicohort 206 trial. We will be initiating ILLUMINATE 206 this quarter as a triple combination with tilsotolimod and Bristol-Myers' ipilimumab and nivolumab, first in microsatellite stable colorectal cancer.

I'll now turn the call over to Liz to share more of the details of the ILLUMINATE programs. Liz?

Elizabeth Tarka

Thank you, Vin. Good morning to everyone. Let me begin by noting how excited I am to be joining Idera at this critical time in tilsotolimod development and having the opportunity to lead this program and team. I share the medical community's clear enthusiasm for tilsotolimod as we advance this treatment through the registrational path in anti PD-1 refractory melanoma and through various other treatment combinations and tumor types. I'd also like to recognize Joanna Horobin for all of her efforts with the team in advancing tilso to this point and continuing to serve as an adviser to us as we move forward.

Starting with the registration study, ILLUMINATE 301, we recently implemented a few modifications to the trial, as Vin noted. These were based on advices from the trial steering committee along with recent discussions conducted with global experts. The overarching message was that the clinical outcome assumptions in the original 301 trial design were much higher than experts in the field felt were currently necessary to demonstrate significant clinical benefit for patients with metastatic melanoma refractory to a PD-1 inhibitor. When the 301 trial was originally designed in 2017, there were several notable approaches being investigated for patients with melanoma therefore, anticipating significant competition in this indication. The 301 trial was designed with a high bar for benefit in both survival and response rate. Since that time, many of those approaches have not progressed to approvals and the treatment options remained limited.

As a reminder, the ILLUMINATE 301 trial is a Phase III global multicenter clinical trial evaluating the efficacy and safety of intratumoral tilsotolimod in combination with ipilimumab versus ipilimumab alone in patients with anti-PD-1 refractory melanoma. This trial is being conducted at approximately 100 sites across 11 countries. In the 301 trial, overall survival and overall response rate comprised a family of primary end points, which means that achieving either of these end points can lead to a regulatory approval.

For the overall survival end points, our original clinical assumptions were intended to demonstrate 18-month median overall survival with the tilso tplus ipi combination versus median overall survival of 11.4 months, which is the historical control in subjects receiving ipi alone following chemotherapy. This resulted in a target median overall survival improvement of 6.6 months, which equated to a target effect size of 0.63. Instead, our steering committee and external experts suggested that an improvement of 4.6 months would be clinically meaningful, which equates to a target effect size of 0.71. To maintain statistical power, this required an increase in the sample size of the trial from 308 to approximately 450 patients, which is our new enrollment goal. At this point in time, 294 patients have been randomized into the trial. Based on our current pace of enrollment, we expect to complete randomization in the first half of next year.

As for the overall -- the end point of overall response rate, the ipilimumab alone overall response rate in anti-PD-1 refractory melanoma has never been definitively studied in randomized clinical trials, but is generally believed by treating physicians to be approximately 10%. Our initial clinical assumption was to demonstrate a 20 percentage point difference applying RECIST version 1.1 criteria to the tilso-ipi combination versus ipi alone. However, our advisers recommended that an improvement of over ipi of 10 percentage points would be a significant clinical benefit in this refractory patient population. We have solicited feedback from the FDA, and they do not object to these changes. We also solicited feedback from other global health authorities and anticipate having their input shortly.

Moving now to the preliminary results we provided this morning from the ILLUMINATE 204 trial, our Phase I/II study of intratumoral tilsotolimod in combination with ipilimumab. As of now, we have data from 49 efficacy evaluable patients. Of these 49 patients, 13 achieved a partial response or better, representing a 27% overall response rate by the RECIST version 1.1 criteria. Of these 13 responses, 8 are durable, defined as six months of duration or longer. Median overall survival has not yet been reached with the range from 1.6 to 35 months.

I'd also like to bring your attention to the disease control rate from this trial. Overall, 36 of the 49 patients or 74% have achieved a best response of stable disease or better. We believe this rate of disease control in this difficult-to-treat patient population is encouraging and may correlate to survival benefit. More often than not, in our experience so far, patients who have had disease stabilization appear to maintain that status for lengthy durations as well. We've had patients enter trial with stable disease for periods such as two years and ongoing.

We also felt it would be informative from an overall survival perspective to review the data from the 26 subjects we had presented at the 2018 ASCO Meeting as they have been in the study for the longest amount of time. Among this group of 26 patients, 52% of subjects were still in follow-up at 12 months using an overall landmark survival analysis. Our team is planning to submit an abstract of the complete 204 trial data to one of the major oncology conferences next year.

To summarize the melanoma discussion, we believe it is quite clear from the medical community that 4.6 months improvement on overall survival and a 10 percentage point improvement in overall response rate would be viewed as a clinically meaningful and exciting option for their patients. With the expected overall response rate and the early indicators of overall survival presented in the preliminary analysis from study 204, we believe that tilsotolimod can indeed deliver real benefits to patients. We are excited and encouraged as we continue to execute the study.

I am now going to turn the call over to John to provide an overview of our financial results from the second quarter.

John Kirby

Thanks, Liz. And I too am excited to be joining you today as Idera's new Chief Financial Officer and providing you with an update of our financial results through the second quarter of 2019. I'll first touch on the financial results for the quarter, and then we'll provide an update as it relates to our cash position.

Research and development expenses for the three months ended June 30, 2019, were $10 million compared to $10.9 million for the same period in 2018. General and administrative expenses totaled $2.9 million compared to $4 million for the same period in 2018. The difference in general and administrative costs were related to lower employee and facility costs as a result of cost savings realized in connection with the closing of our Cambridge, Massachusetts facility in July 2018. In the three months ended June 30, 2018, we also incurred $1.6 million of merger-associated costs, which did not exist in the comparative 2019 period.

Net loss applicable to common stockholders for the three months ended June 30, 2019, was $11.2 million or $0.39 per basic and diluted share. This compared to net loss applicable to common stockholders of $16 million or $0.59 per basic and diluted share for the same period in 2018. Revenue for the three month period was $1.4 million compared to $200,000 for the same period in 2018.

Moving on to cash. As noted in our press release this morning, as of June 30, 2019, our cash, cash equivalents and short-term investments totaled $52.4 million. We expect based on our current operating plan, our existing cash, cash equivalents and investments will fund our operations into the second quarter of 2020. We have the financial flexibility to fund our operations through the arrangements with Lincoln Park Capital and JMP Securities, and we'll continue to apply a very disciplined approach to our expenses.

With that, I'll turn the call back over to Vin for closing remarks.

Vincent Milano

Thank you, Liz and John, for providing those updates. I am sure that you would agree we have made a great deal of progress this year with tilsotolimod. As most of you know, we are a small company with limited resources. For a team of our size to have progressed a global multicenter registrational study as rapidly as we have is a testament to the spirit of our people and our focus on delivering for patients who are in desperate need of new solutions. We are not yet at the finish line, but we are well on our way.

We also feel strongly that we have taken the right steps to enhance the probability of a successful outcome for this first pivotal trial with tilsotolimod. This is of paramount importance to the patients suffering from this devastating disease. Although we've seen tremendous progress in the field, notably with the advancement of checkpoint inhibitors, we truly are just scratching the surface of the potential of immuno-oncology. We believe that tilsotolimod will be a leader in the next level of innovation of immuno-oncology and are both honored and humbled by the awesome task of delivering it to those patients.

This concludes our prepared remarks for our call today. We'll now open up the line to take your questions.

Question-and-Answer Session

Operator

[Operator Instructions]. And our first question will come from Anupam Rama with JPMorgan.

Anupam Rama

Congrats on all the progress. A quick one from me. On study 204, I noticed in the press release, you highlighted about 40% of patients had ECOG 2 performance status. Maybe you could talk a little bit about the severity of the patients enrolled in the study relative to, say, the competitive environment, and in that context help us put the overall response rate into context that you're seeing with study 204.

Vincent Milano

Thanks, Anupam. Great to hear from you. So let me begin maybe on the second part of your question is the relative comparison, and then maybe Liz can comment on the details relative to the performance status, ECOG performance status, in 204 versus the -- in patient population that are on Phase III 301.

So I'd say, what we've observed and analyzed, Anupam, is that this is the only study of all the studies that we can compare ourselves to that is enrolling these set of patients, these ECOG performance status two. We took the sickest of the sick, which I think is reasonably consistent with what a Phase I study would look like. And as we noted in our press release, I think 43% of the patients that have been enrolled in the study are actually ECOG performance status two. So we think that's a differentiating factor with the data that we generated, that we have treated the sicker patients in that -- in the study.

Now importantly, how does this relate and correlate to what we're doing in Phase III? And I'll ask Liz to provide that answer.

Elizabeth Tarka

Thanks, Vin. So the Phase III trial does not include patients with ECOG status two. That, as you know, ECOG status two represents the more challenging patient population. So it's therefore conceivable that the overall response rate in the Phase III trial may be improved over these preliminary results from study 204 since we are not enrolling the more challenging patient population in the 301 study.

Operator

And our next question will come from the line of Gena Wang with Barclays.

Gena Wang

I have a few questions regarding 204 and 301. For the 301, are you able to see blinded data? And would that trend in line with your adjusted assumptions?

Vincent Milano

Gena, thanks for your question. We do not look at the blinded data from an efficacy standpoint. Obviously, we have to monitor the safety.

Gena Wang

Okay. Okay. And then...

Vincent Milano

And in the 301 question or two -- just out of the 301 question, right, Gena?

Gena Wang

Yes. 301. 301, yes.

Vincent Milano

Yes. Right. So now in 301, we are not looking at the data from efficacy perspective at all. We need to maintain the integrity of the study and run it in -- conducted in compliance with GCP. So no insights from the 301 study. The insights relative to the data were from 204 correlating with the feedback from the steering committee and our advisers relative to the current view of what's clinically meaningful in this refractory population.

Gena Wang

Okay. Very helpful. And then a question for 204. Of 13 responses, how many responses were confirmed?

Vincent Milano

Shah will look into it. Shah Rahimian is the medical oncology lead for the program.

Shah Rahimian

Hi. Thank you for your question. 9 out of the 13 responders were confirmed and four were unconfirmed.

Gena Wang

Okay. And the four unconfirmed just because there was not enough time or they were not able to be confirmed?

Shah Rahimian

No. Many of them were recent and were still waiting for confirmations.

Gena Wang

Okay. Okay. And the last question is what is the median duration of response for 204?

Shah Rahimian

Sure. So the median duration of response is not reached yet. And we do analyze that. Later, we will have that hopefully in our next announcement at the next conference.

Gena Wang

Okay. So because you give a number, right? So the durable response is over six months. But out of all the patients show the response, what is the median duration of response?

Shah Rahimian

Because of the unconfirmed responses, we didn't calculate the median duration of response.

Operator

And our next question will come from the line of Swayampakula Ramakanth with H.C. Wainwright

Swayampakula Ramakanth

This is RK from H.C. Wainwright. Regarding the data that is expected to be presented at ESMO Conference, could you comment on what we could be seeing? And then based on that, what are the next steps for tilso monotherapy?

Vincent Milano

So Shah, do you want to take the ESMO question?

Shah Rahimian

So you mean AACR or ESMO?

Vincent Milano

ESMO.

Swayampakula Ramakanth

The ESMO next month.

Shah Rahimian

Okay. So at this point, really, we are looking at -- we have -- we would like to report more on our patients that has the response, the unconfirmed response. We will elaborate more detail on that patient. I think we will have more data on our melanoma four patients, which were not included in that previous report. So I think the -- as more data will be more interesting insight.

Vincent Milano

And RK, on you starting question relative to the plans around monotherapy, we don't have additional plans for monotherapy. The plan to evolve is focused on 206, in taking the translational data that we've seen in 206 first into the microsatellite stable colorectal cancer, and then into the head and neck cohorts.

Swayampakula Ramakanth

Okay. And then in study 301, is there an interim look designed into the study at this point?

Vincent Milano

So the interim look is -- there is an interim analysis in the study. The context of that interim analysis, RK, is around our desire and plan to submit for an accelerated approval around ORR. And so the interim analysis will be to support that there's no detriment, if you will, from a survival standpoint vis-à-vis the tilso combo versus the ipi alone there.

Swayampakula Ramakanth

Okay. And then on the 204 study, what's the longest follow-up you have had in a responding patient?

Vincent Milano

I think it's still -- probably the first complete responder from May of 2016. So we're out three years.

Operator

And our next question will come from Mike Ulz with Baird.

Michael Ulz

Just a quick one from me. Just with respect to the 301 study, you're sort of upsizing the patient numbers and you're going to complete enrollment in the first half of next year. Just what's the earliest we might be able to see data? Should we be thinking 2021 potentially?

Vincent Milano

Thanks, Mike. Liz, do you want to take that?

Elizabeth Tarka

Sure. So sometime between 9 and 12 months from when the last patient is enrolled in the study, we would expect to have the overall response rate and the durability of response.

Operator

[Operator Instructions]. Our next question will come from the line of Robert Driscoll with Wedbush.

Robert Driscoll

Could you talk about any baseline differences or I guess expected baseline differences between the patients enrolled in ILLUMINATE 204 versus 301, just in particular with regards to state of disease and maybe similar previous treatments? And if you saw any striking differences in efficacy across the stage of disease in 204?

Vincent Milano

So maybe I'll take the last part of that question first, Robert. We have not analyzed the data across the different ECOG performance status, 0, 1 and 2, completely. We can say that there is -- there are more responders, of the 13 responders, that are in ECOG 0 and 1. We will be scrubbing that data relative to a subsequent disclosure, but the specifics we're not ready for today. But maybe Shah can give some commentary on the -- call it the patient profiles, if you will, that you asked in the first part of your question.

Shah Rahimian

Sure. Answering your question about the baseline characteristics, really, the two studies have very similar baseline characteristics. And I think the only important differences are first, what we discussed is the ECOG score that in the Phase III study, we exclude patients with ECOG 2. And the other thing is a prior use of ipilimumab. As you know, 204 study allow patients to participate with prior ipi use. In the Phase III study, we allow patients that had ipilimumab in the adjuvant setting. So ipi use in the metastatic setting will be exclusionary.

Robert Driscoll

Got it. And then just with regards to 206, could you elaborate on why MSS colorectal cancer was chosen, just given its apparent resistance to at least single-agent checkpoint inhibition?

Vincent Milano

Shah?

Shah Rahimian

Sure. So as you know, MSS-CRC is one of the most challenging tumor types, it's a cold tumor type. And as you know, the majority, almost over 80%, of the patients in colorectal cancer are MSS-CRC. So really, the base to start that study was our data from the monotherapy study 101. We saw patients with stable disease, long-term stable disease. And some of them interestingly had actually some reductions in their tumor -- total tumor burden. It was not enough, of course, to reach a response, but we felt that this is a great field to investigate tilso. And that was really the base. The -- of course, there are also transitional reasons to back this decision in terms of resistance to prior -- and other available immunotherapy agents. So I think we have a strong base for the 206 study. Did I answer your question?

Robert Driscoll

Yes.

Operator

And we have follow-up questions coming from Gena Wang with Barclays.

Gena Wang

Just a quick question regarding the interim analysis for potential accelerated approval. What is the FDA feedback on 10% benefit of overall response?

Elizabeth Tarka

The feedback is the FDA did not object to our proposed changes in the amendment.

Gena Wang

Okay. So that should be sufficient if you show 10% of ORR differences. That would lead to the accelerated approval.

Shah Rahimian

Yes. Interestingly, that -- in the absence of any other treatment in this field, we got the feedback from really experts that 10% difference will be meaningful. Of course, this is what's -- the minimum that the trial can capture. So we believe that tilso will perform better, may perform better. And also, it's not just the response rate, but also the durability of response. And that's -- I think that's an important factor that the agency recently looked into.

Vincent Milano

Yes. Just from a study standpoint, it's power to show a difference in those overall survival and ORR. So if we achieve our objectives in this study, we should meet the statistical significance. And again, on the marketplace side of it, the percentage differences are driven by the views from the actual experts in the field.

Operator

Thank you. I'm showing no further questions at this time. So now it is my pleasure to hand the conference back over to Mr. Vin Milano, Chief Executive Officer, for any closing comments or remarks.

Vincent Milano

Thank you. Thank you again, everyone, for joining us here this morning. We're -- we've had a very busy first half of the year. I hope that you feel the same way after listening to us here. We wish you an enjoyable last few weeks of our summer and look forward to giving you an update soon on the progress we're making with tilso in our company. Wishing you all an outstanding day. Thank you.

Operator

Ladies and gentlemen, thank you for your participation on today's conference. This does conclude our program and we may all disconnect. Everybody, have a wonderful day.

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