Corvus Pharmaceuticals, Inc. (CRVS) CEO Richard Miller on Q4 2019 Results - Earnings Call Transcript
Corvus Pharmaceuticals, Inc. (NASDAQ:CRVS) Q4 2019 Earnings Conference Call March 5, 2020 4:30 PM ET
Company Participants
Zack Kubow - Investor Relations, Pure Communications
Richard Miller - President and Chief Executive Officer
Leiv Lea - Chief Financial Officer
Conference Call Participants
Tony Butler - ROTH Capital Partners
Mara Goldstein - Mizuho
Jeet Mukherjee - Jefferies
Operator
Good afternoon, ladies and gentlemen. Thank you for standing by and welcome to the Corvus Pharmaceuticals Fourth Quarter 2019 Business Update and Financial Results Webcast. Today's conference is being recorded. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time.
It is now my pleasure to turn the call over to Zack Kubow of Pure Communications. Please go ahead, sir.
Zack Kubow
Thank you, operator, and good afternoon, everyone. Thanks for joining us for the Corvus Pharmaceuticals fourth quarter 2019 business update and financial results conference call.
On the call to discuss the results and business highlights for the fourth quarter 2019 are Richard Miller, Chief Executive Officer; Leiv Lea, Chief Financial Officer; and Mehrdad Mobasher, Chief Medical Officer. The executive team will open the call with some prepared remarks, followed by a question-and-answer period.
I would like to remind everyone that comments made by management today and answers to questions will include forward-looking statements. Forward-looking statements are based on estimates and assumptions as of today, and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by those statements, including the risks and uncertainties described in Corvus' quarterly report on Form 10-Q filed with the SEC on October 29, 2019 and other filings the company makes with the SEC from time to time. The company undertakes no obligation to publicly update or revise any forward-looking statements except as required by law.
With that I'd like to turn the call over to Leiv Lea. Leiv?
Leiv Lea
Thank you, Zack. I'll begin with a quick overview of our fourth quarter and full year 2019 financials and then turn the call over to Richard for a business update. At December 31, 2019, Corvus had cash, cash equivalents and marketable securities totaling $78 million, as compared to $114.6 million at December 31, 2018. Research and development expenses in the fourth quarter of 2019 totaled $8.9 million, compared to $8.4 million for the same period in 2018. The increase of 0.5 million is primarily due to an increase in outside CPI-006 and CPI-818 program costs partially offset by reduced outside ciforadenant costs.
Research and development expenses for the full year 2019 totaled $38 million, compared to $38.6 million in 2018. The decrease of $0.6 million is primarily due to reduced ciforadenant costs partially offset by an increase in CPI-006 and CPI-818 program costs and personnel costs. I would like to note that we continue to carefully manage our expenses and currently expect full year 2020 net cash used in operating activities to be between $39 million and $42 million, compared to $37 million in 2019.
The net loss for the fourth quarter of 2019 was $11 million, compared to a net loss of $10.5 million for the same period in 2018. The net loss for the full year 2019 was $46.7 million compared to a net loss of 46.9 million in 2018. Total stock compensation expense for the fourth quarter and full year 2019 was $1.7 million and $7.3 million respectively, compared to $1.8 million in 7.1 million in 2018.
I will now turn the call over to Richard.
Richard Miller
Thank you, Leiv, and good afternoon, everyone. Thank you for joining us today for our fourth quarter and full year 2019 business update. In 2019, we made substantial progress enrolling patients in our studies and advancing our pipeline of precisely targeted oncology therapies. The progress provides more clarity defining three areas that our product candidates address; number one, adenosine pathway inhibition an A2A receptor blockade and inhibition of adenosine production by anti-CD73; number two, immunomodulation of immune cells, particularly B cells, and three modulation of T-cell function through the kinase ITK.
The key highlights from the year include the following, we continue to report encouraging data from the Phase Ib/2 clinical trial of ciforadenant in combination with atezolizumab in patients with advanced refractory renal cell cancer. Ciforadenant is the most advanced candidate in development across the landscape of adenosine 2A receptor antagonist with more than 300 patients receiving treatment today. We reported the first data for CPI-006, our novel, first of its kind anti-CD73 antibody, demonstrating that it may provide a new immune-oncology approach both via the activation of immune cells and through the inhibition of adenosine production.
The data indicates CPI-006 has potential as a monotherapy and as a combination medicine in a variety of tumor types. In addition, we continue to develop the Adenosine Gene Signature, which we believe will be an important predictive biomarker for ciforadenant and for CPI-006. Our work in the adenosine pathway was reinforced by multiple independent studies from industry and academia over the course of the year adding to our confidence that our programs are positioned for success. Outside of the adenosine pathway, at the resent American Society of Haematology Meeting, we presented initial data from the dose escalation portion of our Phase I study for CPI 818, our small molecule ITK inhibitor, making it our third program in the clinic.
This continued in January with additional clinical data presented at the T-Cell Lymphoma Forum in San Diego. In 2020, we will continue advancing our clinical studies for ciforadenant, for CPI- 006 and CPI-818. I will begin with an update on the recent work with ciforadenant and the Adenosine Gene Signature that gives us increasing confidence in the outlook and trajectory of our lead program. In the January 2020, issue of cancer discovery, our peer reviewed article was published on ciforadenant and the Adenosine Gene Signature authored by Dr. Larry Fong of UCSF, one of Corvus' clinical trial investigators.
The article presents the safety and efficacy results from 68 patients with advanced refractory renal cell cancer and for the first time in publication described the identification and the potential to use the Adenosine Gene Signature as a biomarker for conducting responsive therapy with ciforadenant and protesting adenosine blockade in general. This study and Adenosine Gene Signature were recently highlighted at the ASCO Genitourinary Symposium meeting in San Francisco in February. Briefly here are some of the key facts related to the Adenosine Gene Signature. The signature has now been confirmed by other academic and industry groups.
The signature appears to identify a subtype of renal cell cancer that has a poor prognosis in a group of patients that is unresponsive to anti-PD-1 therapies with a very low response rate and extremely poor PFS of less than three months even in Phase I setting. Patients with high adenosine signature were generally low for an angiogenesis signature. The angiogenesis signature is an established biomarker which predicts response – favorable response to angiogenesis inhibitors. What this means is that the adenosine signature identifies a group of renal cell cancer patients. We estimate that this is about 50% of patients that recording with current therapies.
The signature identifies a myeloid cell population in the renal cell cancer tumor microenvironment that functions as an immunosuppressive cell, which now highlights this myeloid cell population as a potential target for immunotherapy that is targeting the myeloid components of the tumor microenvironment. The cancer discovery article demonstrates that in patients with high levels of the Adenosine Gene Signature expression, there was a statistically significant association with tumor regression with ciforadenant treatment. Adenosine signature-positive patients achieved a 17% response rate by RECIST versus 0% in signature-negative patients.
These patients also demonstrated more growable progression free survival with a tail on the curve for the adenosine signature positive patients. The data indicate that the Adenosine Gene Signature may be useful as a predictive biomarker to select patients more likely to respond to ciforadenant and that resistance to anti-PD-1 may be reversed by ciforadenant in these patients. It also suggests that the signature can identify patients with low expression of the angiogenesis gene signature which can predict poor response to anti-angiogenesis agents. This double enrichment gives the Adenosine Gene signature exciting potential as a biomarker that identifies patients that will be better with ciforadenant and have unfavorable outcomes with standard of care TKIs, tyrosine kinase inhibitors. The article was further highlighted in the journal's editorial by Dr. Michail Sitkovsky, Professor of Immunology at Northeastern University.
In addition to acknowledging the pioneering research, he noticed that anti-tumor activity was seen in highly resistant patients. We have already enrolled approximately 25 additional renal cell cancer patients with the goal of confirming the value of the adenosine signature. We're also working on refining the signature and very good progress has been made in that area. We intend to update both the clinical and biomarker data at the ASCO annual meeting in June. With these additional data, this year we will be positioned to initiate a late stage trial based on the Adenosine Gene Signature in second, third or later line renal cell cancer patients. There remains an unmet need for these patients and we anticipate that the signature will be capable of identifying the patient group that is likely to be better with ciforadenant compared to standard therapies
We also presented data on ciforadenant in prostate cancer at the ASCO GU Cancer Symposium in February. We are in the very early stages of this trial, with a median follow up of only 3.2 months. The highlights from that data included as mentioned, in the follow up of 3.2 months, there was one partial response by resist. This patient had a PSA dropped from 98 to less than one, 10 additional patients had tumor regression not yet meeting the criteria for partial response, and seven patients have confirmed stable disease exceeding six months. Many of these patients with minor responses stable disease are continuing on therapy and it is possible that their responses may deepen. We intend to update this data at ASCO in June.
One other important finding included in this presentation was gene expression profiling of tumor biopsies demonstrated a statistically significant correlation of tumor CD73 expression with the Adenosine Gene Signature. This correlation supports the relevance of adenosine in prostate cancer, its production by CD73 and the expression of adenosine induced immunosuppression gene.
Let me turn now to CPI-006 or anti-CD73 antibody, we continue to be enthusiastic about this novel immunomodulatory antibody. We most recently presented data from the Phase I/Ib study at the Society of Immunotherapy of Cancer meeting in November. Similar to prior results presented at ASCO, we are seeing activity in renal cell prostrate in non-small cell lung cancers with an acceptable safety profile. We also continue to see dramatic effects on circulating immune cells with B-cell and T-cell mobilization and redistribution. These cells are specifically activated into antibody producing cells both in vitro and in vivo. And these attracts are adenosine independent and are related to the immunomodulatory agonistic properties of the antibody. We are not aware of any other agent's antibody or small molecule targeting CD73 that has exhibited these properties.
It should be noted that interest in the role of D-cells in immunotherapy has intensified. Recent papers in Nature have shown that tumor infiltration with D-cells are an important predictor of response to immune-oncology therapy. This gives us added confidence and interest in CPI-006. Recently, we have found evidence that some of our patients are producing antibodies to their tumor following therapy that CPI-006. Although preliminary, this is a very exciting and important funding. In terms of the ongoing study, we have now selected the optimum dose of 18 milligrams per kilogram every three weeks for monotherapy and in combination with ciforadenant. We recently open the CPI-006 in combination with pembrolizuma arm of the study, and we expect to soon open the last arm of the study which is CPI-006 plus ciforadenant plus pembrolizuma, a triplet regiment.
Finally a quick update on CPI-818 or ITK inhibitor, as mentioned in my opening remarks, we presented the first data on this program at ASH in December and at the T-Cell Lymphoma Forum in January. We have now reached the goal that substantially inhibits the target. So we are now positioned to evaluate potential efficacy. The Phase I portion of the study has met our expectations as we have determined safety, PK, receptor occupancy and we have selected goals, early signs of anti-tumor activity has been observed.
In summary, we continue to believe Corvus is well positioned with worldwide commercial rights to three candidates in the clinic and a leadership position in the adenosine pathway. In addition, the further characterization and confirmation of the Adenosine Gene Signature increases our confidence that we can identify the patients most likely to benefit from therapy with ciforadenant. We intend to share meaningful updates on this program at ASCO in June.
I will now turn the call back over to the operator for questions-and-answers. Operator?
Question-and-Answer Session
Operator
Thank you. [Operator Instructions] We'll first go with Tony Butler from ROTH Capital Partners. Please go ahead.
Tony Butler
Yes, thanks a lot. Richard, two questions really. One is around the antibodies produced in patients that you've been able to cultivate patients treated with 006. Question is, have you found any common antibodies among those patients today and can you say anything about antigen, that's number one. And number two, when will we actually see up – and you may have said this, forgive me if I had missed it, when will we see updates with the 006 data? Thank you.
Richard Miller
Okay, let me take the first question on the antibodies. So we have observed low target antibody responses in a few of these patients. In one patient we've been able to identify the antigen. And it is I'd rather not say what the antigen is right now, but it is a bona fide lung tumor antigen something that you will be very familiar with. So what we need to be doing now, of course, is seriously monitoring patients and trying to figure out what happens to their fighter of this antibody. Now, in addition to that, we like many others are – I call it D-cells from patients and looking at individual D-cells and trying to dissect out what these antibodies might be reacting with. As I think you're aware of the Nature papers back a month ago, so highlighting the importance of D-cells infiltrating tumors has been more importantly in terms of predicting response from T-cells really heightened our motivation in this area. And as you know, I'm a former antibody guy, so I love antibodies. And they seem to work pretty well and a lot of different things. So we're really excited about the potential importance of the immunoimmunity part of our therapy. But really, it's very early in this work and so we don't have a lot of information yet as to what the importance of those antibodies are and what they might do. Now in terms of data on 006, ASCO is going to be – I did mention, ASCO is going to be mostly about 444, amino in the biomarker. I think 006 work, we'll wait till 15 November.
Tony Butler
Thanks Richard. Good show.
Operator
Thank you will next go with Mara Goldstein from Mizuho. Please go ahead.
Mara Goldstein
Great, thanks for taking the question. Just two questions and the first is really on that adenosine signature and just understanding how you will incorporate that into the clinical trials that are ongoing and how you see that from a clinical practice perspective. And then just on 818, I apologies, but can you confirm the dose that you're settled on?
Richard Miller
Okay, let's take the first question. So as I mentioned in my remarks, we've already enrolled an additional proximately 25 patients which had the aim of confirming what we described in the cancer discovery paper. And so far – we don't have all the data in on the 25 patients. It appears to be holding up very nicely. We're now leading with PROs and lots of thought leaders in renal cell cancer area. Probably in a few months, we'll be in a position where we'll talk about how we will incorporate this biomarker into our clinical trial plans. But I can tell you, Mara, that it will be a very important part of our clinical trial.
Mara Goldstein
Okay.
Richard Miller
Now, your question on 818, we recently enrolled patients at 600 milligrams TID. We've just gotten through the DLT period on that we don't see any toxicity at that dose. We've confirmed very substantial receptor occupancy and we're following those patients. Now, I think that this does have a few other measurements we have to make, in addition to receptor engagement, some other functional assays that we'll be looking at and also even though you make it through the DLT period it is nice to get a little bit more follow up on these patients because you don't want to see side effects beyond the DLT period. But I think that a dose of – I think that we have a dose of around 400 to 600.
Mara Goldstein
Okay, thank you. Appreciate it.
Operator
Thank you. We'll next go with Jeet Mukherjee from Jefferies. Please go ahead.
Jeet Mukherjee
Yeah. Hey guys, this is Jeet on for Biren. Richard just wanted to maybe get a little bit more color on those 25 additional RCC patients you said you had. Just wondering if you had any details on terms of maybe how these patients compared to the existing patients that we've already seen. And I have a couple follow up questions.
Richard Miller
I mean, pretty much the same kind of patients. We did was restrict the number of prior therapies although more because of course in our original 68 patients seen in Phase I study. And thank you for raising this point. There were all kinds of typical Phase I patients in this. So we did try to get a little better patients and of course the other best thing in this additional 25 patients was that you had to have failed an IO and a TKI and the reason is that is obvious in the last year or two, it has now become standard practice to do a TKI and IO, either first line or first and second line. So those are the differences.
Jeet Mukherjee
Got it, that's helpful. And then just two other questions that I had was heading into ASCO, how many more patients worth of data could we expect for the ciforadenant and then prostate cancer? I believe, on the ASCOS GU poster it had said that there was perhaps some follow up plan at the 2020 ASCO meeting. So just wanted to know maybe how many more patients we can expect there for that indication. And will these patients be stratified by adenosine signature gene signature?
Richard Miller
Okay, prostate cancer patients, I think is about 33 or 35 patients on our GU ASCO poster, I mentioned the follow up was short. I mean, our main goal now is we're following those patients and trying to get more follow up. We did not stratify for adenosine signature in that. Obviously, we're going to be looking at that. I mentioned this relationship of CD73 in adenosine signature, which is an interesting observation, but doesn't get exactly to your point. But it does seem that CD73 makes adenosine and adenosine generates the Adenosine Gene Signature, all fits together very nicely. But basically, I think what you're going to see at ASCO in our prostate cancer is a little bit more biology and more follow up.
Jeet Mukherjee
Okay, got it. And then just my last question was on 006, when do you anticipate opening the combination dosing on with pembro?
Richard Miller
It's open.
Jeet Mukherjee
That's open. Okay. Thank you very much.
Richard Miller
Yeah. Yeah. All right, any other questions.
Operator
[Operator Instructions] We'll head to our next question from [indiscernible] from H.C. Wainwright. Please go ahead.
Unidentified Analyst
Thank you. This is [indiscernible] from H.C. Wainwright. Thanks for taking my questions. Most of my questions have been asked, but recently the – we noted that from clinical trials that there is a new study of ciforadenant as a single agent and also as a combination with daratumumab in patients with multiple myeloma. Can you give us a little bit of a background and an update on that?
Richard Miller
Yes, thank you for that question because I often neglect talking about that. So the rationale for that study, which has been conducted at Johns Hopkins Medical School, which is perhaps one of the best myeloma groups in the world. The rationale is that daratumumab of course is anti-CD38 antibody. CD38 turns out to be another important source of adenosine. And the – I won't go into the biochemistry, but energy is broken down and one of the byproducts of that is adenosine. And so the strategy is simply to combine an adenosine antagonists like our ciforadenant with daratumumab in patients who have failed Dara. So this is a really nice study where patients who are growing through Dara will get our A2A inhibitor added to it. Additionally, as a monotherapy because remember our A2A antagonist as opposed to everyone else's, has demonstrated monotherapy activity simulation activity in many tumors.
So we want to look at myeloma cells and we have some in vitro evidence for that. And then I think within a month, they come in with daratumumab. And the idea there is you're trying to restore responsiveness to an otherwise resistant patient. And of course, we're looking at bone marrow biopsies and looking at the genesis in signature and all the usual things. So the rationale is basically CD38 is a good source of adenosine and we want to come up at two ways. There's very nice publication on that that showed, I think it was out of MD Anderson in various animal models. What they showed is that if you block A2A receptor together within anti-CD38 you get synergistic response to mouth tumors. They also looked at gene expression in patients in human biopsy samples and found that in CD38 resistant patient's there was increase in A2A receptor expression. So that's the scientific rationale. We're excited about that study, because it gives us a lot of potential things that we can measure and give us a lot of good information.
Unidentified Analyst
Thank you. Thank you, for that elaborate answer. Appreciate it.
Operator
Well, next go with Tony Butler from ROTH Capital Partners. Please go ahead.
Tony Butler
[technical difficult]
Richard Miller
Tony, it's hard to hear you, but the 25 patients I mentioned they have proven they have failed TKI and IO.
Tony Butler
Okay. They have failed. Okay, perfect. Thank you very much. I just wanted to make sure. Yeah, thank you.
Richard Miller
Yeah. No, we're clearly focusing in on the patient population – look, our strategy is very simple. We're going to go late line in resistant patients where endpoint is going to be obtained presumably faster and so forth and then of course, move up earlier as we get more experienced. Now, the interesting thing is that with the success of IO first line renal and second line, there are many, many more patients who are surviving to see second, third, fourth line. So that is definitely becoming, as we predicted by the way, it is becoming a new entity or a serious patient population is unmet need.
Tony Butler
Thank you.
Operator
Alright, it appears there are no questions at this moment. I'd like to give the conference back over to the moderator for any additional closing remarks.
Richard Miller
Okay. This is Richard Miller. Thank you all for participating in this call. We thank you for those great questions. Look forward to updating you on future calls. And of course, hopefully, see you at our ASCO meeting. Thank you very much.
Operator
This concludes today's call. Thank you all for your participation. You may now go ahead and disconnect.
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