Good afternoon, everyone. I hope everyone's enjoying the conference. It's been a fun, but kind of packed first day, I'm not going to lie. My name is Akash Tewari. I am a pharm and biotech analyst here at Jefferies, and I have the Cytokinetics management team. Robert Blum, and I think I asked enough annoying scientific questions that Fady ended up coming up as well, which is always a pleasure. I'm going to hand it off to Robert. He's going to have some introductory slides, then we're going to get into one-on-one questions. Go ahead.
So thanks to Akash and the organizers for inviting Cytokinetics to provide another update. I have just a few slides, but I think it'll set a context for a lot of the questions that I know he wants to ask, and hopefully others may similarly want to ask. I'll be making some forward-looking statements or refer you to our SEC safe harbor filings with regard to caveats, and we don't undertake any obligation to update the forward-looking statements. So today we'll be talking about Cytokinetics and primarily about aficamten. aficamten is the lead program in our specialty cardiovascular franchise that we're building, and we've been at this for a while, as you may know, but it's really coming into its own right now with aficamten having been the subject of presentations and publications this year that we believe set the table nicely for what could be review and approval.
We submitted an NDA rolling submission to FDA in Q3. We're going to be submitting to EMA in this Q4. We submitted in China, our partner did, and this morning we announced a deal in Japan. I'll be talking about that in a moment. But we're looking at aficamten as a global cornerstone for the business we're building, not just in oHCM, but also ultimately in nHCM, and as hopefully can be rewarding of both science, medicine, and shareholder return. aficamten is followed, as you can see on this slide, by other programs. Omecamtiv mecarbil, soon to be the subject of a confirmatory Phase III study in heart failure and reduced ejection fraction, CK-586 in heart failure and preserved ejection fraction starting up in Phase II. And you begin to get a picture of how we think about our franchise and having that build for a commercial business.
All of these compounds, all three of them, are modulators of one molecular target, cardiac myosin. We know it better than anybody else. Fady and his team were the first to demonstrate it to be druggable and produce therapeutic hypotheses around which we're building a business. It serves also to be enabling and opening a window in other ways we can, with muscle biology, continue to be a pioneer and a leader. And recently we announced the start of a phase one study with CK-257, a skeletal muscle activator. And as you can see here, we have other programs beneath the hood, so to speak, of our interest beyond muscle mechanics and contractility to include energetics, growth, metabolism of muscle. Directed principally to two verticals, our specialty cardiology vertical around which we are going to be focused over these next five years, and then afterwards our neuromuscular business.
All of this is against a backdrop of a very strong financial position. We've done a lot of financial engineering over the years, including primarily business development transactions and less often equity fundraisings and royalty deals. But Cytokinetics has hopefully set a high watermark in ways that we can monetize our advantages in R&D to be enabling of access to capital. And as I'm here today, we recently reported our Q3 financials north of $1 billion in cash on the balance sheet and, importantly, access to additional capital from Royalty Pharma, from partnerships around which we can access hundreds of millions of capital more so in order to execute on this business. We believe in good financial discipline. We've demonstrated we can be deploying capital in efficient ways as are in the interest, we hope, of returns for shareholders. And you can see all that outlined on this slide.
As we think about this myosin platform and delivering multiple milestones to demonstrate increased shareholder value, we're dead set, clear-eyed on how that can be translating into news flow, milestones, near term, medium term, longer term. You can see just over the next couple of years that Cytokinetics is in a good position to demonstrate and provide evidence to support the build of this strategy. Here you can see even over the next year how many important key milestones will drive shareholder value as we expect to go to market with aficamten in North America and also soon afterwards in Europe. As we think about our populations, and we oftentimes get asked, why do we think at Cytokinetics we can build a cardiovascular business where so many biopharma companies have failed and where we would be going head to head with a large multinational pharma company?
I'll tell you that I think we have competitive advantage. We have competitive advantage because we're focused on not the broader populations as might be served by a cholesterol medicine or an anticoagulant, but specialty cardiovascular segments that are highly in tune with opinion leader engagement and influence, highly concentrated customer segments where with a lean sales and marketing infrastructure we can produce high return on investment and spending, highly concentrated customer segments where our reputation precedes us and where the expertise we've built over 20 years in science and clinical research translates into commercial traction, highly concentrated customer segments where we do believe we'll have more payer leverage based on how those opinion leaders write guidelines and the absence of competitive dynamics.
This is where I think Cytokinetics, not just in hypertrophic cardiomyopathy, obstructive and non-obstructive, but also severe advanced heart failure, HFrEF, supernormal ejection fraction, heart failure, HFpEF, we believe we can continue to carry forward that same business strategy in ways that can build enduring value for shareholders. And yet these are not small ultra-orphan indications. These are markets that are evidenced by hundreds of thousands of patients with high unmet need not being well served by GDMT, guideline-directed medical therapies. These are markets that are substantial, again, treated by a relative few cardiologists where we can approach them with a lean infrastructure and also where we do believe we'll have both pricing power, reimbursement leverage, and at the same time, we foresee that there's not competitive threats for the business that we're building. We'll have more to say about that, I'm sure, in the Q&A.
We continue to be the leader in the science and clinical research underlying our programs. Here you can see just for Aficamten alone, the ongoing clinical trials. A couple of weeks ago, the Journal of the American College of Cardiology had five out of six publications on Aficamten. We've been prolific in the way that we've presented and published, and that won't stop now. You'll see Maple as it's due to read out first half next year, Acacia in 2026, Cedar and Forest continuing. Cytokinetics continues to be demonstrating our commitment to science through ongoing clinical research, setting the stage for Aficamten in the marketplace. And similarly, as I mentioned a moment ago, business development continues to be a hallmark of how we do business. This morning we announced a deal with Bayer in Japan.
We've been talking about doing a deal for Aficamten in Japan since 2023, and we've been fortunate, almost an embarrassment of riches, if you will, that we've had such high-level interest from both Japanese local companies and multinationals. We were able, with the data presented and published, to attract a high-level engagement, and we were able to negotiate a deal that we would say is amongst the top decile in deals in Japan. You can see here, both from the standpoint of economics, front-end, near-term, medium, and longer term, I think this deal with 50 million EUR payable upon signing, 90 million in near-term milestones, 20 million of which are even sooner, hundreds of millions in commercial milestones and royalties that start in the high teens and eclipse 30 percentage points. This deal, I think, stands alone amongst deals in terms of economics for a cardiovascular drug.
At the same time, we and Bayer are highly aligned, as agreed, with a joint development plan on what needs to happen next. Cytokinetics will be expanding the ongoing Acacia study in nHCM to enroll Japanese patients. We've already engaged PMDA around what that should look like. At the same time, we will be enrolling Japanese patients in Cedar, the pediatric study, and our partner now, Bayer in Japan, will be enrolling patients with oHCM in a small study to supplement what already is known with Sequoia and Forest in order to bring Aficamten to market in oHCM. We've had a lot of opportunity to talk to key principals at Bayer, and ultimately these deals come down to people and conviction and alignment. I think Bayer has indicated and underscored its commitment to cardiology, as is the recipe to its success worldwide and especially in Japan.
We're very pleased to partner with them to bring Aficamten to patients in Japan. I'm sure we'll talk more a little bit about that. Here are some upcoming milestones across the portfolio as we've been talking. Now I'll turn it back to Akash. I'm sure he's got questions for us.
Great. Thanks. So Robert, let's start. You know, I remember there's always debate on peak sales for aficamten, right? And you know, some people are like, "Oh, is this a $2-$3 billion drug? Is it a $3-$5?" I don't know how many people said $10 billion, right? And that was certainly an eye-opening number that your team gave at the Investor Day. That inherently also implies kind of 50% penetration in kind of the diagnosed symptomatic HCM patients. I mean, that's obviously a huge commercial opportunity that you have in front of you. When you think about the Japan market, and what I think the question I'm really getting at is, how big is the aficamten opportunity HCM in Japan?
And do you feel like Bayer was seeing that same kind of, you know, if the U.S. and EU is $10 billion for Aficamten, what is the potential market opportunity in Japan? And do you feel like those economics were kind of aligned with the deal that you announced today?
Yeah, so can you hear me okay?
Yep.
I do believe that the economics are aligned with the value that we see for aficamten globally. We wouldn't have done the deal this way otherwise. And you know, Japan typically represents anywhere from eight to 12% of global opportunities. That has a lot to do with pricing. I do believe that aficamten is perceived as a novel innovation, and I think it should be hopefully commanding uncommon pricing. But for where I think the market is and where it's growing, I think having mavacamten potentially available in Japan before we get there and then aficamten afterwards enables, like we've seen in other categories, undiagnosed patients to be better diagnosed. And I do think Japan is one of these opportunities as we've done our own forecasting and spent time talking to lots of companies about how they perceive the opportunity.
I don't think Cytokinetics is in any way out of orbit with others. And I think we all agree that this is a big opportunity for aficamten in that geography.
Understood. Now, maybe going, you know, you obviously, your team has a ton of catalysts that are coming up for next year, but even with mavacamten and Bristol, they're going to have some data points as well. I feel like for a lot of investors, when there's a differentiation in nHCM, I think that'll really start to resonate with people that if you can get differentiated data into indications, the strategic optionality could maybe meaningfully expand. When you think about, and maybe this is also a question for Fady, the data that mavacamten's kind of generated in nHCM, 20%-25% of patients have LVEF drops below 50%. What are your expectations for that Phase III readout? And then when you've looked at the data that you've generated in your Sequoia studies, why are you confident that, you know, Aficamten's going to have a differentiated clinical profile in that setting?
So firstly, to your point, I do think that the street has been focused more primarily on oHCM, and I would argue very little as we look at analyst models is attributed to potential upside value for Aficamten in nHCM. And whether you think that Aficamten is a $2-$4 billion drug or a $4-$6 billion drug or even higher, I think all of the work that seems to be done to this point is primarily around oHCM. nHCM could unlock even further value based on the ongoing pivotal studies. And the prevalence data would suggest that nHCM may become more and more a part of the mix. Right now, you know, we've been talking about nHCM may represent 30%-40% of total.
In other countries, and including in Japan, that mix may be more like 50/50, especially as we do a better job of discerning around heart failure and different forms of heart failure, preserved ejection fraction. And as you know, nHCM resembles a bit like the supernormal HFpEF population. As it relates to Mavacamten and Aficamten, I do think there are differences. So Mavacamten is the subject of a Phase III study that has completed enrollment called Odyssey, and it'll read out, we expect in 2025. Aficamten, the subject of Acacia, it'll complete enrollment, we expect in 2025 and read out in 2026. The studies are different because the drugs are different. And the dosing regimen, to your question about ejection fraction excursions, the dosing regimen we understand that's being used in Odyssey is a different one than one that is being commercially deployed for Mavacamten.
That's to be seen as to whether that's an advantage or perhaps might introduce new risk. But we're using in Acacia a dosing regimen that is already validated in Sequoia and ongoing Forest. Nobody better than Fady maybe to speak about the trial design and what we hope it might produce for us and how that could be unlocking a value in nHCM.
Thanks. Well, you know, Acacia was designed on the back of a Phase II trial that we did, cohort four of Redwood. We enrolled about 40 patients with nHCM. We were able to dose them essentially the same way we dosed oHCM patients using ejection fraction as really the guide for when to stop dosing. So number one, the dosing regimen that we used in Phase II is exactly what we carried over into Phase III. In Phase II, we had, I thought, some very compelling data with improvements in symptoms, NYHA class, reductions in biomarkers, and a very good safety profile. I mean, we didn't really have, I think we had two marginal EF drops out of the 40 patients that reversed, you know, as we always have with just a decrease in dose.
That safety profile and the preliminary efficacy we saw helped us thinking about how we designed Acacia, where we employ the same dosing scheme. We added an extra dose of 20 at the high end because 85% of the patients in the Phase II got up to the highest dose of 15 that we used there. We haven't seen, you know, a lot of dropouts and things like that. So we're pretty confident, I think, that we have a good dosing regimen that's well tolerated. And we're measuring the things in the Phase III that we, you know, we saw improvements in in Phase II. So KCCQ is the primary endpoint. We saw improvements in that in the Phase II. We've added exercise as another, as a secondary endpoint, but a unique measure of exercise performance that combines submaximal and maximal exercise performance.
And all of those things we hope, you know, add to the confidence of seeing.
But Fady, I don't think this is well appreciated that your primary endpoint is KCCQ. Can you talk about the signal that you showed in your Redwood studies in cohort four versus what Mavacamten showed in MAVERIC and why that was the primary endpoint you wanted to choose in nHCM?
Yeah, well, to be fair, I think the Odyssey study is also using KCCQ in its primary endpoint. But, you know, we saw pretty clear improvements in the open-label Phase II study. The, I don't want to be misquoted as to the magnitude, but it was, I think, over 10 points or something. So a large change wasn't placebo controlled, but we have a very good sense of what placebo does from Sequoia and other trials.
And so when we used those data to calculate our power, we have very good power for KCCQ and Acacia for what would be a meaningful effect.
Understood. Now, the more near-term endpoint for you or trial for you guys is Maple, which I think I personally think is very important in terms of changing standard of care and kind of showing that maybe a beta blocker isn't the right approach for a lot of these symptomatic HCM patients. You released data, I believe at ESC, where I think for the first time on Sequoia, you're showing patients getting off beta blockers. And I think that might have flown a bit under the radar. So on peak VO2, for patients who were getting off a beta blocker and they were on Aficamten, you, you know, in your Phase III study, you were showing 1.7 benefit.
But for patients who were getting off beta blockers, it was actually 2.2, and then placebo was actually turning the wrong way. So an even bigger benefit on peak VO2 than I think we've expected. Is that the right bar for success for Maple? Why or why not?
Well, I think the data contribute to our expectations for Maple, but there are some differences in Maple. We are enrolling a less severe population than in Sequoia. And that was intentional. We wanted to, you know, basically show that less severe patients also have substantial benefits. And so I think the, you know, the absolute numbers may be a little hard to handicap, but they should still be quite surprisingly meaningful based on, you know, our experience in Sequoia.
As you said, we sort of did the experiment within a sub, you know, you could think of it as a sub-study within Sequoia has already been done. It demonstrates the efficacy of these molecules in that setting.
Moreover, we're assessing peak VO2, and beta blockers are thought to have no effect on peak VO2. So in some ways, it's a trial design that's maybe a little bit stacked in our favor based on what we already know from Sequoia. We still need to do the experiment because payers are still encouraging the use of beta blockers in frontline treatment for patients with oHCM, but there's no evidence to support their use other than the fact that we didn't have anything else for HCM until now.
So by doing this study, we liken it to the kind of trial you might do as a phase four post-marketing study, but we're bringing it forward as should be hopefully available, at least in the form of presented and published data when we go to market for aficamten. We think that could be to our advantage in terms of how we show up in the marketplace, and especially with payors. And while it will be the subject of, if positive, a supplemental NDA and may not make its way into labeling until somewhat in 2026, we expect the guidelines are going to be reflecting of its data, hopefully to be enabling of wider adoption sooner.
Understood. Now, you know, there's competition obviously in the space, and you know, Edgewise has shown some encouraging data. Frankly, I think the data is encouraging because it also looks very similar to CK-586.
One of the things that I think my team and I picked up from the Edgewise data was at HFSA, it went from, you know, no LVEF variation 50-5 down to then when the slides came out, it was none under 50. But then when the full presentation came out, it was 10 up, 10 down. And, you know, you guys are obviously experts in the field. When you think about an AE table and just, you know, the chances of you incidentally picking up any LVEF reductions under 50%, A, when you have variability of 10 up, 10 down, doesn't it seem fairly likely that there will be transient excursions? But then number two, to be fair, not only to Edgewise, but also to your drug, do you feel like the FDA cares about transient excursions on LVEF? What's the nuance there?
Well, I think it's important to know that EFs of. I think there's too much focus on, you know, is EF 49 or 48 or 51 or 52, makes no difference at all because those measurements change hour to hour, day to day. You know, the thing I think FDA cares about is, and we care about, are patients experience symptoms of heart failure. And importantly, do those symptoms lead to hospitalization to treat that heart failure? So we haven't observed that with Aficamten. Aficamten has been clean from that perspective. And I think that's the key thing to understand in terms of thinking about risk profile.
Right. Understood. And maybe just lastly on that point, I think, you know, some of your peers say, well, I can create a dosing paradigm where I can go with a fixed dose formula, you know, fixed titration.
I don't have to even have doctors look at echo. You know, part of me says you could go dose with aficamten 5 and 10 mg, and theoretically, of 300 patients' worth of data, you had no LVEF excursions below 50%. I mean, talk to me about practically how you think Aficamten is going to be used in the real-world setting, right? Very likely you'll probably have that six-month echo requirement on the REMS. But do you feel like you might be able to see Aficamten actually have this kind of fixed dose? You know, we'll treat five, we'll treat 10. If a patient's having, you know, symptom relief, we're done. And then we'll dose higher if we need to. Could that actually be what the real-world treatment experience ends up being with Aficamten?
I think people will, you know, likely find that the lower doses are very well tolerated and there's no risk. But the question is, you know, how do you optimize therapy? You know, it's like treating blood pressure. You could start everybody on, you know, 20 milligrams of lisinopril and everyone would probably be fine. But I suspect a large proportion of patients' hypertension will be undertreated. Right. And so, you know, for patients in whom they are undertreated, their symptomatic benefits not optimized, you want to push the dose. And when you push the dose of almost every drug in cardiology, you need to monitor for the effects of potentially high exposures or high doses. The beauty of aficamten is that it's very much like a blood pressure medicine. You can titrate it up, you can titrate it down.
You know, what you do to monitor its effect is relatively simple, not as simple as blood pressure, but the echoes are actually not that hard to do. You know, a fixed dose means you're going to give up on efficacy, I think. Right.
Maybe lastly a question for you, Robert. I remember in our Jefferies conference in New York, you obviously had, you know, it was surprising to see Akash and really just talking about we're in line about creating shareholder value for the board. You know, both from the management level, but also the board level, you're considering all options. I think that was something that was, you know, important for your team to put out there.
I remember one of the questions I asked you in New York was, do you feel like from a strategic perspective, people are giving you credit for the obstructive HCM opportunity and then everything else, right? Like, what are people giving you credit for and then what do people not understand? Since you had your investor day.
When you say people, are you referring to potential suitors? Strategics.
Strategics. Since you've had your investor day and you've kind of opened the kimono, you've told people how you really think about this commercial opportunity. I'll ask you kind of the same question. Where do you feel like there's the biggest disconnect or maybe lack thereof between how you see the commercial opportunity and other people might?
So I'll answer that a couple of ways.
As it relates to our strategic business development conversations, we have them often and they continue as we are very active and have been for many, many years in the community of biopharma companies and especially cardiovascular ones. We know all of the multinational companies very well. We continue dialogue with them about this and that and the other thing. And I believe that the biggest disconnect lies between how the street perceives our pipeline and how strategics do because we have demonstrated myosin modulation is a successful therapeutic strategy across multiple diseases. To be clear, omecamtiv mecarbil has been successful in an 8,000 patient Phase III study.
And while it's not yet available to patients, consider it on the five-yard line with first and goal because we have with FDA approval to do a pragmatic study design as is enabling of us to collect just that information to verify the doubling of the effect we saw in the more advanced heart failure patients. A study that Fady and his colleagues have designed that'll get started in this fourth quarter. And Fady and I attended on Sunday morning in Chicago at the American Heart Association meeting, a steering committee meeting for that trial. And I can assure you that there's a very high level enthusiasm amongst advanced heart failure specialists for this trial and this drug. I think there's a major disconnect between how they perceive an opportunity for omecamtiv mecarbil in advanced severely reduced ejection fraction heart failure patients and how the street looks at it.
That's okay because, you know, our focus is on aficamten right now and it's not on commercializing omecamtiv mecarbil. But it won't be very long after we launch aficamten that people will be asking us, so what's next? I do believe that for the amount of investment required, the time omecamtiv mecarbil represents the next best opportunity for us to unlock further shareholder value as we will be doing. I think we'll be in a good position to move forward with a drug that's already positive in a first Phase III study. Similarly with CK-586, and I think strategics see value in that. I do believe that that could represent a big partnering opportunity if we were inclined to do that, whether that's in China or Japan, whether that's in Europe or rest of the world.
We're looking at CK-586 as could also be enabling of us additional capital and leadership in an indication area where there's tremendous unmet need.
And Robert, because they're going to kill me because I'm over time, but I just wanted to ask one follow-up to what you just said. It does sound, based on what you're saying right now, there is at least more alignment on the strategic value of Aficamten. Is that a fair statement?
That there is some alignment?
As in like the delta between what Cytokinetics thinks about the market opportunity for Aficamten and let's say outside parties. You know, in New York, it seemed like Aficamten, you weren't even getting credit for NHCM. Today you're saying, we're not getting credit for omecamtiv, we're not getting credit for 586. That sounds like progress to me in the sense that maybe you're getting closer together.
Is that a fair read?
Yeah, I don't want to imply something that you might be trying to tease out of me this way. I am trying. What I am going to say is we maintain active dialogue and there's high-level enthusiasm for the things we're doing.
Understood. Thank you so much. I really do appreciate it.
Thanks so much.