All right, welcome everybody once again to the 45th Annual TD Cowen Healthcare Conference. I'm your own Warren from the Biotech team, and it's a great pleasure to introduce someone who really needs no introduction. I think, David, we've known each other for just about 20 years. David Hung, who is the founder, president, and CEO of Nuvation Bio. With us today also is Philippe Sauvage, CFO. We have JR from Finance and AR as well, and Ops and BD. Gentlemen, thanks so much for coming. We appreciate it. David's going to give about 22 minutes or so, roughly, presentation. We'll do Q&A. Thank you.
Thanks, Jorunn. Thank you all for coming. Nuvation Bio is a global oncology company, and we're trying to make best-in-class drugs by improving upon mechanisms that we are known to be validated but have encountered some limitations in either safety or efficacy. We have four programs in the clinic. The latest one, the most advanced one, is Taletrectinib, which is a third-generation ROS1 inhibitor. The NDA for that molecule has been accepted by the FDA. We've been given priority review in the line-agnostic setting and plan to have a PDUFA date of June 23 this year. That drug has also already been approved in both the first and second line in China. Our second molecule is called Safusidenib. It's a brain penetrant mutant IDH1 inhibitor for the treatment of mutant IDH1 glioma, and we are in the process of designing pivotal studies for that molecule.
1511 is our first drug-drug conjugate, akin to an antibody-drug conjugate or ADC, except without the A. We'll talk about a little bit about that. We're in the clinic with that molecule in dose escalation studies. 868 is a BD2-selective BET inhibitor, which has just completed phase one. We have a robust balance sheet of $550 million as of our last Q. As you'll see in a couple of slides, we just completed a $250 million royalty debt financing announced this morning. As I mentioned, we have four programs in the clinic: two advanced, two early stage. What we announced this morning is a $250 million financing with Sagard, $150 million in royalty, tiered 5.5% from zero to $600 million, 3% from $600 million to $1 billion. We retain all U.S. net sales above $1 billion.
On the debt side, $50 million upon approval of Taletrectinib and the ability to call another $50 million in the next 12 months, interest-only, attractive rates, and really very limited financial covenants. We are really, really excited about working with Sagard. Very excited that this gives us the capital now to really give us a lot of flexibility. I think with our $550 million balance sheet, we did not need to finance. We could have easily launched our drug and probably even gotten through to profitability without it. This really takes for us all doubt off the table and gives us flexibility if we were to entertain other potential new developments. I think that to us, it is a validation of our asset and something that we are very excited about. This was a very competitive process. There were over a dozen parties involved in our process.
We received quite a few term sheets, many term sheets, and we are really, really delighted to pick Sagard as our partner. On Taletrectinib, this is a small molecule for the treatment of ROS1 positive non-small cell lung cancer. As I mentioned, the NDA was just accepted with a priority review, and we plan to have a PDUFA on June 23. We believe that this is a best-in-class molecule based on its efficacy and safety profile. This drug originated with Daiichi Sankyo, which was licensed by AnHeart, and when we acquired AnHeart earlier this year, we assumed not only this molecule but also Safusidenib. If you look at the landscape of current ROS1 inhibitors, there are three approved agents.
In the first line setting, the first-generation agents, Entrectinib and Crizotinib, have overall response rates in the 70% range and progression-free survival of about a year and a half, roughly 18 months. Repotrectinib, the only second-generation TKI, has a significantly better overall response rate, now 79%, and a PFS that is double the first-generation TKIs of 36 months. Taletrectinib now has an overall response rate of 89% and a PFS nearly a year longer than Repotrectinib. Just to put that in some context for you, if you look at the number of drugs in any solid tumor, in any indication in the history of oncology, there are actually none that can match an 89% overall response rate and a 46-month PFS.
Even if you look at Selpercatinib, the RET inhibitor, 84% response rate, 22-month PFS, biggest drug in lung cancer, Osimertinib, 77% response rate, 19-month PFS, and that's a $6 billion-a-year drug. Even Medivation's Xtandi, which we developed and commercialized, 59% response rate, 20-month PFS, and that's a $6 billion-a-year drug today. Just to put that in some context for patients and physicians, the argument is if you use a first-generation TKI like Entrectinib, the only CNS-penetrant first-generation TKI, you get about 16 months of PFS. When you fail that and go on to a second-generation agent, you get an additional nine months of PFS with Repotrectinib. If you add 16 and 9, you get about 25 months total PFS. If you were to start with Taletrectinib in the first-line setting, you would get nearly two years longer PFS than that.
We think that's a very compelling argument for both patients and physicians. If you look at the main attributes that determine what prescriptions are written for various agents in oncology, by far the most compelling argument for prescription is the length of your progression-free survival, followed by overall response rate, and then things like how efficacious are you at treating acquired mutations and durability of response. As I mentioned earlier, in all these numbers, Taletrectinib is at the head of the pack: 46-month PFS, 89% ORR, one of the highest response rates in G2032R, which is the common resistance mutation for ROS1, and a 44-month duration of response. If you look at the second line setting, Taletrectinib again has overall the highest response rates and median PFS, even in the second line setting.
If you look at the overall response rate of Repotrectinib, the only other agent approved today in second line, it's 38% compared to our 56%. Repo's PFS is nine months. Ours is 10 months. Importantly, if you look at as these patients progress, CNS metastases become more and more important because they become more common. The intracranial response rate of Repotrectinib is 38% and Taletrectinib 66%, so significantly better intracranial response rate. Even if you look at Nuvalent's drugs, Zidesamtinib, all those very, very few patients, only 20 patients to date in the second line setting, if we look at the response rate following crizotinib and entrectinib, still at 53%, not quite up to 56%. Importantly, if you look at the intracranial response rate so far, 50% compared to Taletrectinib, 66%.
There are really no metrics of efficacy where Taletrectinib has been bettered by any agent, either approved or currently in development. If you look at the safety profile of Taletrectinib, the leading adverse event that we see with Taletrectinib is elevation of liver function tests. These are very common among TKIs, and the ways that physicians generally treat them is by managing them by either dose interruption, dose reduction, or if the drug is really intolerable, drug discontinuation. We're the green bars here. If you look at the dose interruption and dose reduction rates for Taletrectinib, they're still lower than the currently used approved TKIs: Repotrectinib, entrectinib, crizotinib. If you look at discontinuation rate at 7%, still among the lowest discontinuation rates of any drug currently approved for the treatment of ROS1 non-small cell lung cancer.
An important differentiating factor in the toxicity profile is the lack of CNS side effects. If you look at Repotrectinib, by far the leading problem with Repotrectinib on the tolerability side is a high incidence of CNS adverse events due to the fact that Repotrectinib hits ROS1 with an identical affinity to its affinity for a closely homologous protein called NTRECB. With the therapeutic eminence of one, it's very difficult to get coverage of ROS1 without getting prohibitive CNS toxicity. The dizziness rate here is 65%. If you look at the dizziness rate for Taletrectinib, not only is it a third of Repotrectinib, but more than 90% of this is grade 1 and transient, often just a day or two. A significantly better tolerability profile than Repotrectinib on the CNS front.
If you look at the incidence of ROS1, it's about 2,000-4,000 patients in the United States based on about a 2% incidence among non-small cell lung cancer cases. When we look at the market potential of this agent, if we just multiply the 3,000 patients that are new every year, multiply times the Repotrectinib current price, which is $350,000 a year, that's about a billion dollars of market opportunity every year in just new patient starts. Because Taletrectinib's PFS is almost four years, 46 months, that means that every year these patients should continue on drug for an average of four years, so capturing 10 out of 12 months in the fourth year, which should equate to about $3.8 billion by year four.
It is stacking of revenue that was so important in generating massive sales of, let's say, Revlimid for Celgene because of the long PFS. That is what you'll see here. There is a very important development that just occurred a month ago regarding the NCCN guidelines in this space. If you look at the way that ROS1 patients are diagnosed, when they have a lung mass and get a biopsy, that biopsy is sent off for pathology and then NGS testing. The pathology comes back very quickly, oftentimes in a day or so. The NGS can take two to three weeks to come back. Because these patients on average are 57 years old, very anxious, they've just been diagnosed with cancer, they want to be on something.
The standard of care prior to ROS1 inhibitors was IO chemo, so they get put on IO chemo in a large number of cases. When their NGS comes back two to three weeks later and you think they switched to a ROS1 agent, they actually surprisingly do not in many cases. Why is that? Because the old NCCN guidelines up till the end of 2024 said that if you had ROS1 discovered after you started another systemic therapy like IO chemo, there were two recommendations. Recommendation number one is to complete that systemic therapy, including maintenance. Or number two, you could switch to a ROS1 agent.
That changed on January 7 this year when, a month ago, the NCCN revised its guidelines to now say that if you're discovered to have a ROS1 rearrangement after starting another first-line systemic therapy like IO chemo, not only do you need to interrupt that therapy and switch to a ROS1 agent, but now if you have ROS1, IO is actually contraindicated. That is a very, very important development because now the standard of care for the treatment of ROS1 patients cannot be IO chemo. It should not be because if you look at the average PFS of IO chemo, it's about 6-12 months, whereas Repotrectinib has a 36-month PFS, and we've just shown a 46-month PFS. It is very hard to make the argument that that's the right course of therapy for a patient.
We believe that these NCCN guidelines, which are just brand new, will be very, very important in shifting the dynamics of this market. We believe that Taletrectinib will be well poised to capture a majority of it. The question is, of that market opportunity, how much should Taletrectinib capture? I've cited two historical precedents to give us an answer there. If you look at the ALK space and the EGFR space, first-generation crizotinib meant its PFS was about 10 months. Second-generation Alectinib in the ALK space showed a 16-month improvement in PFS and a 7 percentage point improvement in ORR. If you look at Taletrectinib over first-generation TKIs, our improvement in PFS isn't 16 months. It's 30 months. Our improvement in ORR isn't 7 percentage points. It's 20 percentage points.
If you look at Tagrisso, Osimertinib in the EGFR setting, the benefit of Tagrisso, Osimertinib over Afatinib is 9 months of PFS, 8 percentage points of ORR. As I mentioned, compared to first-line agents, we have a 30-month improvement in PFS and 20 percentage point improvement in ORR. Even against second-generation Repotrectinib, our benefit at 10 months still exceeds Osimertinib's benefit over Afatinib. Our 10 percentage point improvement in ORR, even over second generation, still exceeds the 8 percentage point improvement of Tagrisso over Afatinib. We have not approved yet, so we will be. In the trials, our total valuable population is 337 patients, and including the safety database, it is well over 400 patients. It is the largest ROS1 database assembled to date. We will be getting—we have already had our NDA accepted and given priority review.
If you look at the launch of ALK drugs, both Lorlatinib and Alecensa, you can see that today they take about 90% market share over first-generation TKIs. If you look at Tagrisso, it has almost 100% market share. Given the fact that Taletrectinib's benefits over its competitors are greater than either the ALK inhibitor's benefits over their competitors or Tagrisso over its EGFR competitor, we believe that those drugs have a 90%+ market share. We should have a similar magnitude of market share. We believe that this is quite a significant commercial opportunity. We're going to be launching this drug. For those of you who may recall back from Medivation, we launched Xtandi at Medivation. My Chief Commercial Officer, Colleen Sjogren, and Dan Thompson, my Head of Sales, also were with me at Medivation.
As you might recall, we launched Xtandi 18 months behind J&J Zytiga and within eight quarters, we overtook Zytiga sales. Xtandi went on to become the biggest drug of all time in prostate cancer with over $6 billion a year in sales today. That is the story on Taletrectinib. We have another program that we consider also very exciting, a second molecule that we acquired in the AnHeart acquisition called Safusidenib, a mutant IDH1 inhibitor. If you look at what mutant IDH1 does as an enzyme, normally IDH1 wild type would form something called alpha-ketoglutarate. When you have mutant IDH1, instead of staying at alpha-ketoglutarate, that gets metabolized further to something called 2-hydroxyglutarate or 2-HG. 2-HG is bad for two reasons. Number one, it causes cancer because it causes epigenetic dysregulation and impairs cellular differentiation.
Number two, once you have a cancer, it creates a tumor immunosuppressive microenvironment so that tumor can evade immune surveillance. Safusidenib is a highly brain-penetrating molecule that really potently inhibits mutant IDH1 and causes dramatic reductions of 2-HG, almost 100%. If you look at the prevalence of mutant IDH1 gliomas, they're quite substantial, a larger market opportunity than even ROS1 because the PFS of these patients can be many, many years. The prevalence is actually significant. Two-thirds are low-grade, one-third are high-grade. The only other drug which has been approved in IDH1 mutant glioma is called Vorasidenib, made by Agios. Importantly, Royalty Pharma just paid Agios $905 million in cash for a 15% royalty on only U.S. net sales and valuing Vorasidenib at around $6 billion.
If you look at the Vorasidenib data that determined the outcome of that transaction, in low-grade gliomas in Vorasidenib's phase one study, the response rate was 18%. In their pivotal study, it was 11%. In the first study of Safusidenib conducted by Daiichi Sankyo, our response rate in low-grade glioma was triple that, around 33%. Later this year, we'll be presenting new data on a second Daiichi study, which will not only show overall response rate, but more importantly, PFS for the first time. If you look at the response rate in high-grade gliomas of Vorasidenib, it was zero. Safusidenib has a 17% response rate in high-grade glioma. Importantly, of that 17% response rate, a third of those were complete responses. Complete response means the tumor disappears.
Importantly, if you look at the tumors that disappeared, one of them was a glioblastoma, as you know, one of the most notoriously difficult-to-treat cancers, now called grade 4 astrocytoma. That tumor disappeared for 174 weeks, so three years. A second high-grade glioma, this one an oligodendroglioma, disappeared for 95 weeks. We believe that these results are quite compelling. Compared to Vorasidenib's 0% response rate, 0 CR, 0 PRs, we think this is a very intriguing asset. We are now working with the FDA to design a pivotal study for Safusidenib. One question is, why are these drugs so different if they hit the same target? I start off by saying that mutant IDH1 not only causes cancer, but it creates an immunosuppressive environment for that cancer, so it invades immune detection.
If you look at an IDH1 tumor on biopsy, you can see that this tumor specimen up here shows relatively few infiltrating T lymphocytes, which you need to fight cancers. If you inhibit IDH1 in this preclinical experiment, you can see a reversal of that and now infiltration of TILs into the tumor. That causes significant improvement in efficacy going from the black line to the red line in tumor xenograft studies. If you look, we did the following experiment. We took two cancer models, one in mice that were immunodeficient, so they did not have an immune system to activate, and one in mice that had a normal immune system, so there was an immune system to activate. On the left, Safusidenib had some effect, but relatively modest effects in reducing tumor growth.
In the mice that had an intact immune system, Safusidenib took survival of the mice, which is very poor in the blue line, up to the green line. A dramatic improvement in survival of the animals that had an immune system to activate, whereas Vorasidenib, the Agios drug, even at five times the clinical concentration, did not do that. Somehow, fundamentally, these two drugs appear to have different effects on the ability to recruit the immune system to fight their cancer. We believe this may play a role in the difference in clinical results that we're seeing so far in clinical trials. Interestingly, if you look at the top eight adverse events of Safusidenib, five of them are immune. Although these are still grade 1 and 2, very, very, very few grade 3 reactions.
If you look at the five immune-type reactions, skin hyperpigmentation like you might have in vitiligo, pruritus like you might see in primary biliary cirrhosis, alopecia like the autoimmune alopecia areata, arthralgia like you see in rheumatoid arthritis, rash like you see in lupus. Interestingly, Safusidenib has immune-type AEs. Vorasidenib does not. Vorasidenib's main side effect is elevation of liver function tests, but none of these immune-type reactions. Safusidenib causes an activation of immune systems in preclinical models, resulting in improvement in efficacy. Vorasidenib does not. Safusidenib has a 6% complete response rate, 17% high-grade response rate. Vorasidenib is 0, 0, 0. In the low-grade setting, Safusidenib has about three times the Vorasidenib pivotal study response rate in low-grade glioma, and we'll be showing further low-grade data later this year. We believe these drugs are pretty interestingly different.
We think that Safusidenib may be a new generation of oral IO agent. We are very intrigued by what the FDA will say about our pivotal trial designs as we head to the clinic with this asset. Finally, we have just a few minutes. In fact, I know you're running out of time, so I'm going to end here. DDCs are in the clinic, and the BET inhibitors finished phase one. I'll just stop with the first two programs so we can have a Q&A. How large is the phase two going to be for SAF? It depends on what the FDA agrees would be the appropriate primary endpoints. Of course, we would like to pick endpoints that allow us to do a shorter, quicker, cheaper study. That's going to be a matter of discussion.
Is that going to be a phase two that includes high-grade and low-grade?
That's another. There will be different studies because Vorasidenib is only approved in low-grade. There is no standard of care for high-grade. I think that the trials will be very different. Whether or not we'll do one or the other or both depends on what kind of trial designs are acceptable to the FDA and whether, from an investment standpoint, the ROI or MPV of those trials makes it worth our effort.
Is the standard of care the same in low-grade versus high-grade?
Right now, Vorasidenib being the only drug that's shown responses in low-grade is the standard of care now because even though the response rate was only 11%, Vorasidenib improved progression-free survival from 11 months to almost 27 months, so a 16-month improvement in PFS.
That was the basis of the Vorasidenib approval. There is nothing in high-grade. It's your standard chemo radiation. The response rates are so poor there that there really is nothing as an appropriate comparator.
I mean, to get approval in low-grade, I wouldn't presume you need to do a head-to-head against Vorasidenib.
I mean, we are actually contemplating that possibility given the fact that we've shown now a response rate in the first Daiichi study of 33%, which we think compares quite favorably with Vorasidenib's 11% response rate. We also have now a second study, which we're going to try to get approval from Daiichi to present later this year. That study will show PFS data for the first time. We believe those results are compelling enough that we would consider a head-to-head study depending on what kind of trial the FDA would agree to.
Maybe just remind us the Daiichi study. How big was that study? Did it have a control?
It was 27 patients. The second Daiichi study is 27 patients, but it's all at the same dose. Unlike the first study, which was a mixture of doses, this is a pure study, one dose, and I think clearer results in low-grade. In low-grade, right?
The Daiichi study was Japanese, or was it global?
It's a Japanese study.
Japanese, yeah. Can you maybe talk about Taletrectinib? How are you thinking about it? I know you probably can't say a lot, but is pricing going to be basically sort of analogous to the last launch from Bristol, or is there a chance for premium pricing because.
We haven't really commented on that yet. I think I would say that the likelihood is it'll be somewhat close in the pricing, but we haven't made a final determination yet.
As you think about just scaling a Salesforce or a commercial organization, how are you thinking about that and timing?
We have already hired most of the functions and all the senior management for commercial. For the sales reps, we generally do that about two months before launch. Our PDUFA is June 23, so perhaps April or so. We've already signed contracts with the whole sales team. We are ready to go as soon as we pull the trigger.
Has FDA communicated about an Adcom or lack of a need?
We do not believe there's going to be an Adcom.
Just remind us, you filed for all frontline and relative? We're line agnostic.
We had already had breakthrough designation in both the first and second line. We were actually the only drug in development that has breakthrough in both first and second line, as you know, because Nuvalent has breakthrough in only third line setting. When we submitted the NDA, it was accepted with a priority review.
Maybe just remind us, I think you talked about the entire data set. What % was from Western Europe and the U.S.?
There were two pivotal data sets that went into the NDA. One is called Trust One, which is a 100% Chinese study. One was called Trust Two, which is a 90% non-Chinese study. Given the size of the database, this is actually the largest database of Western patients submitted for an NDA in the ROS1 space.
As you think about, there's maybe a potential opportunity to file in EMA, but that's for a small company with ambitious aspirations, but still launching in the U.S. is plenty to do near term. How are you thinking about that?
Yeah, our priority is the U.S. And I think that Europe is just logistically cumbersome. We are in discussions right now with potential European partners and clearly would give our partner the option of having a lot of say in how they want that program developed.
Okay. Is there a bit of the doctors excited? This really sounds like a breakthrough of the FDA. [audio distortion]
I think the physicians we've spoken to are very excited because, as I said, there are actually no drugs in oncology in any solid tumor indication that have shown response rates and progression-free survival of this magnitude.
The people we've talked to are really quite excited. I mean, our longest patient out on Taletrectinib is over seven years. This is a cancer that PFS averages 6-12 months with IO chemo, which is the previous standard of care. We think it's a pretty significant advance for patients and are really excited to launch it.
Do you have any sense of what percentage of patients are naive or first-liners versus second, third-liners?
There are 3,000 patients new every year. They will all be naive. Clearly, that's the market we really want to capture because that PFS is almost four years. There are plenty of patients who are on other ROS1 inhibitors currently and have already experienced a TKI, so they would be second-line patients.
When we look at that, that's still another opportunity that we probably will start capturing as soon as we launch. The real prize is the first-line setting. The 3,000 new patients every year is what really makes it such a large commercial opportunity.
Maybe, Philippe, for you, with the new capital, maybe give us a little bit of a sense on your, I mean, I think the press release mentioned that you potentially do not need to raise any more capital after this financing. Can you talk about your capital plans?
Yeah, it's exactly that. I mean, as David said, we were a bit opportunistic. Somebody came in, and then we decided that, if we want to discuss that, let's have a very open process. We're very happy to partner with Sagard on this.
With that financing, we do not expect to need to raise any money before we become cash positive. Actually, the royalty deal makes Taletrectinib launch a cash positive opportunity for us because we have cash upfront. Even if you eat a little bit at the beginning before you get sales, obviously. The debt gives us, as David was saying, lots of flexibility and opportunity. Yeah, it is a very good place to be.
Maybe final question, just David, on the DDC, you mentioned we might see data this year.
Yeah, we are still in dose escalation, so I cannot really quite predict that. We would love to be able to share some data later this year.
Terrific team. Some of us spoke of the last Trump one with the election. I mean, is that going to affect your company at all or your views? [audio distortion]
We have not seen any slowdown at the FDA at all. To the contrary, we had correspondence with the FDA on the day before Christmas and the day after Christmas. We have already had our site inspections set up. I would say they're moving at lightning speed. I think that with our response rate in PFS, this is a drug I don't think that we want to hold from patients. We have been really impressed with what the FDA has done. They've moved incredibly quickly and have been incredibly responsive to us. We are delighted with our interactions with the agency.