Welcome to day two of the Citizens Life Science Conference. My name is Silvan Türkcan . I'm a Senior Analyst at Citizens covering precision medicines. Right now, it's my pleasure to host Nuvation Bio, Philippe Sauvage, and J.R. DeVita. Thank you so much for joining me today.
Yeah, a pleasure.
Maybe you start off, for those unfamiliar, can you just give us a brief overview of what you're doing at Nuvation Bio?
Yeah, of course. At Nuvation Bio, I'm the Chief Financial Officer at Nuvation Bio.
I'm Executive Director of Corporate Development and Investor Relations.
Great. Obviously, you're focused on small molecules. You've built a quite impressive pipeline through acquisition. Could you just recap what your assets are and what stage they're at?
Yeah, of course. So the asset you're going to hear the most about is clearly taletrectinib, our ROS1 targeted inhibitor, for which we have a PDUFA date of June 23rd. So what is it, like 450 some days?
Maybe 40 something days.
Yeah, 40 something days. Very, very soon. We're very excited by that. In our pipeline, we have safusidenib, IDH1-mutated glioma, for which we are basically working on the next steps. We have some Phase 1 results, which are really exciting. I'll talk a little bit about that. We are currently discussing what is the next step for us in terms of pivotal trial. We'll tell that to the market, I think, in the second half of the year. A little bit earlier stage, we have our platform, our drug-drug conjugate. The concept here is to try to do with two drugs what we're typically dealing with antibody-drug conjugates, which gives you lots of interesting properties. Because it's smaller, it can get into the cell, it can target differently, and all the rest.
Of this platform of drug-drug conjugate, we have in the clinic one, NUV-1511, for which we have finished the dose escalation phase. We will release some results by the end of the year to see if it works or not and what are the next steps.
Great. Maybe the focus is obviously squarely on taletrectinib right now with the PDUFA coming close. Can you just outline how it fits into the ROS1 treatment landscape and how it fits in between the other ROS1 TKIs or other TKIs that are used maybe off-label in that setting?
Yeah, we are incredibly excited by the profile of taletrectinib, our ROS1 inhibitor. We had a Breakthrough Therapy Designation for first and second line. We had Priority Review. We have a June 23rd, 2025 PDUFA date. Really, everything is green there. We are already approved in China, second line and first line beginning of the year. We are also in the process of getting approved in Japan. Lots of progress there. This drug, from our perspective, is really incredible. We have a very long experience in oncology in the company. It is very unusual to see a drug with such an incredible profile. We have just released an article in the Journal of Clinical Oncology, our kind of pooled data. You observe 46 months of PFS, 44 months of DOR, 89% overall rate of response. Numbers that are really, really high.
When you look at the universe of oncology in general, those kind of numbers are very unusual. This is really incredibly exciting for us. Obviously, also, we believe very exciting for any patient diagnosed with a ROS1 non-small cell lung cancer because that's an opportunity to have a drug which really does very well. The market has been kind of a little bit smaller than it should be today. I think that's a thing we're going to talk about. You have basically first-generation drug. Obviously, it's hard to compare different trials, different populations. I'll just say what they had at that time in their trial. You'll make the comparison you want. They were typically less, around 70% overall rate of response. A PFS, which was lower than like 20 months, like 16-18 months.
Already quite better than what you would get with a typical IO chemo regimen, which would be only 6-12 months. Still, they've not been used as much as we believe they should have been used. When you look at the total size of the ROS1 landscape in the U.S., epidemiology will tell you there are about 3,000 patients a year diagnosed or actually not diagnosed. I think that's one of the points. Three thousand patients a year with presenting non-small cell lung cancer with a ROS1 mutation that should be treated with those drugs. Currently, this is clearly not the number of patients that are treated. There is a little bit of work to be done. There is a lot of space also to come with better drugs and to show that this is the way to go for patients.
This is the way to treat patients. This is much better than what they're getting today.
Yeah. Maybe since we're already on the crucial topic here, right? I think yesterday on the earnings call, you outlined the sales of the existing ROS1 is anemic to what it should be, given we have 3,000 patients. Obviously, there have been some changes recently to the NCCN Guidelines that could provide a tailwind here. Maybe if you can comment on that. In general, just with your increased duration of response, how do you plan on communicating to the market? Do you think that is sufficient to get doctors to switch their behavior here?
Yeah. I mean, obviously, we have a different team, different drug, different strategy. We are coming up with this with a sole focus and a very targeted, nimble biotech on this topic exactly. As I said earlier, when you look at the current landscape, today, patients should be treated differently, even without us. When you are coming with a drug like ours, which is so incredible from a duration of response, from a PFS perspective, and overall rate of response perspective, this is another impetus in the market to change behavior. That is what should be done. When you think about what has been happening in the market, there are many articles there about the promise of targeted oncology, about the way that things should be done in a much more targeted manner, patients better diagnosed, every patient tested, all these kind of things.
We can see that there is a lot of push happening in the level of the guidelines to go into that direction. The testing rate is still not where they should be. They have been progressing. In academic settings, they are already quite high, like in the 90s. I think in the community settings, they are much lower. They will progress. To your point about recommendation at the beginning of the year, we had two types of recommendations that were very, very meaningful for us. First is, again, a new set of recommendations about the need to test every patient because mutations matter. The type of mutations they have matter for the way they should be treated and, of course, for their long-term health.
The second thing, which was really important for us, is that we used to have guidelines that were very clear on ALK and EGFR about if you find those mutations, you should stop your current therapy if it's an IO chemo and move to an ALK or EGFR targeted agent. Those recommendations, for historical reasons, were not as clear on ROS1 and other kind of ROS1, especially mutation. Therefore, what happened is that NCCN did the right thing. They changed those guidelines, saying for ROS1 as well, if you find this mutation, you should stop your current therapy and move to a targeted agent because this is clearly the best chance for our patients.
All of this has been very, very helpful for us in getting the message out there about the promise of targeted oncology, about everything that can happen for our patients if they're treating properly, and the kind of duration of response and PFS we see. We said to the market yesterday in our quarterly call as well that we have some patients in our Phase 1 trial that have been on drug for eight, nine years, right? This is amazing, the kind of response that you can get sometimes and what it can mean for patients. Very meaningful. We've also been out there in the community setting, out there in the markets, talking to many community oncology and aggregators.
We have seen, again, the level of understanding about what is happening, the way you should change, the importance of testing, the importance of going to a targeted agent, which is really there. We have seen, to our real joy, really, we have seen many changing already their internal guidelines about the importance of testing, about stopping also treatment to move to a ROS1 targeted agent. That is really, yeah, lots of good things happening. Yeah.
One thing we've thought about is that you get pushback, obviously, when you sell the story a little bit about, well, Bristol Myers and ROS1 TKI has been out there. It is better than IO plus chemo. Yet it does not always get used. What we've also been hearing is that there are some CNS issues with that drug that kind of maybe hampers prescriptions here. Can you just talk about the difference between your safety profile with respect to that particular AE?
Yeah. So again, obviously, different trials. So it's hard to make very systematic comparison. What we like to say, though, is that from our perspective, BMS, with the Turning Point acquisition, saw something in that market, which we see as well, which is this idea that because of the nature of the ROS1 mutation and then what a targeted agent can do, you are in a market that can really transform itself because patients will stay on therapy much longer. And if a patient stays on therapy much longer, from a purely commercial standpoint, obviously, it means more revenue, even if the size of the mutation in terms of number of patients at the beginning is smaller. If you think about it, you have only 2% of patients more or less with that mutation. That's a 3,000.
If they stay on drug for four years, suddenly, your population moved from incidence to a prevalence population. It increased quite significantly with the revenues that goes with it. I think from this perspective, we believe this is really the right way to look at this market. What happened to repo is that we believe that the nature of the drug is that it hits two things exactly at the same level, which is called ROS1, the other which is called Trk. Trk has been identified as something that creates all those kind of CNS side effects. Is it a reason why they see such a relatively high level of CNS side effect in their trial? Maybe. Maybe there are other reasons. At least we've seen that.
What we've always seen in the market is that for whatever reason, we, and again, I'll be a little bit prudent there because the data is not always perfect in rare oncology. We see a relatively high level of patients dropping quarter on quarter on drug. Something is happening in the markets that makes repo not delivering on the promise of patients staying much longer on therapy. Why exactly is that? I don't know for sure because I don't know individually all those patients. There is something there. From a Trk hitting perspective, we do that as well, but at a much lower level in assays. It's like 11x-20x versus ROS1 versus they are like one on one.
We believe that might be a reason why in our clinical trial, we do not see CNS as being something which is really a high problem. We see our level of CNS side effect, which is close to crizotinib. Again, different trials. Still, this is what we see in our clinical trials. That might be the driver why we do not see that as much, maybe. At the end of the day, this is not the biggest side effect that we see. That is good.
OK, great. Obviously, you've been doing commercial research out there. Have you collected physician feedback on kind of maybe the sequencing, right? We always think about new strong agent coming in. Would that be front line? You're going to be line agnostic. Would you think immediately you would use it up front or maybe relegate to a later line?
Yeah. No, again, we have first and second line breakthrough designation. We are asking for a line agnostic approval. This is pretty clear. I think in the universe of oncology, it has become clear for whatever agent, ROS1, non-ROS1, whatever you are talking about, that you should start treating your patients with the best drug out there from your perspective and the perspective of your kind of conversation with your patients. We believe that this is the kind of value proposition that we might be able to have for taletrectinib. This is clearly a market which will be driven by first line. This is where we intend to go. Coming back to our article in the Journal of Clinical Oncology, 46 months PFS, 44 months duration of response, this is really high.
This really for us shows that this is where you should go with your first line patients.
Obviously, yesterday, you spent some time talking about this. I'd love to maybe for you to summarize some of the pre-launch activities you've been doing here ahead of the PDUFA.
Yeah. So we've been spending a lot of time telling the good story about the ROS1 landscape, about the need for patients to be tested, about the promise of targeted oncology in general, obviously. Because as I said earlier, the agents already on the market are still better than giving IO chemo to a patient, right? There is no doubt about that. This is the way to go and the way to treat patients today. We've also spent some time with lots of community aggregators and community places because that's where many of the patients will ultimately get treated. We want to spend some time there.
As I said, we've been very pleased with the reaction to the NCCN guidelines and the way that we see all these organizations across the U.S. changing their internal recommendation, moving to this idea that, OK, I should stop the IO chemo treatment. I should move to a targeted agent. This is the right thing to do for my patients. That's been very, very exciting for us to watch. Of course, we've also started a conversation about reimbursement and things of that nature.
Yeah. Maybe what are some of your thoughts? It's always difficult to ask that to management ahead of a PDUFA, right? But what are some thoughts on pricing? And what feedback have you gotten from payers?
Look, we're exploring several options on pricing. Obviously, we did not do it in our quarterly call yesterday. I will not give you the pricing today we are thinking about. We have seen repo getting on the market at a monthly worth of $29,000. I think now they are closer to $30,000 with good access. This is an interesting anchoring price for us. We will keep exploring options and we will tell you when it is public.
OK, great. Maybe talk a little bit about your cash and your spend and how you're supporting launch. I know you have somewhat tranches of non-dilutive debt outstanding. Where do you think your current cash balance can get you? Could you get to the inflection point, I guess, to be cash flow positive with what you have?
Yeah. I mean, we have an incredibly strong cash position. I think probably one of the strongest in the markets today, which is really fantastic for us. At the end of December, we were $500 million. We were close to $460 million. So still a lot of cash. That does not even count the non-dilutive financing we did in March. This non-dilutive financing we did in March with Sagard Healthcare Partners, which have been wonderful partners for us, has added virtually, because this is upon approval, $250 million more, $150 million of synthetic royalty, and $100 million of debt in two tranches, $150 million immediately and $150 million up to one year after launch. These $250 million are virtually, I mean, will be added to our balance sheet at the time of approval. That puts us in a very, very strong cash position.
What we said explicitly at the time of this financing is that this $150 million synthetic royalty, from our perspective, should kind of pay for the initial cut in our cash linked to the launch, if you want. The launch of taletrectinib becomes kind of a cash positive thing for us, which is, again, an extremely, incredibly strong position to be in. In general, with this $250 million financing, we do not expect to have to raise any cash ever. This basically takes us to profitability. The other thing is that coming back to this point of the financing, we were approached with this idea of financing. As a biotech, we know it is always a good thing to have more cash on your balance sheet. I guess we have been proven right when you look at the market in the last few months.
We were really intrigued by the structure of getting especially some synthetic royalty. We had an open process, 14 bidders, multiple term sheets. We ended up with Sagard, that have been incredible partners, and gave to us what we believe is a really good deal. It's only 5.5% royalty on U.S. sales. $150 million for 5.5% of U.S. sales. You can do any math to think about what it means for the value of the asset. Of course, coming from a very savvy party that has looked at everything, like that's the kind of due diligence you can imagine they can do with access to all our information. We see that also as incredibly validating for our story and the story of the value of taletrectinib. Also incredibly validating for the acquisition we did with AnHeart.
Because again, if you go a little bit back in time, we paid for this company $260 million. And then six months later, we get $150 million back for a 5.5% royalty on one of the assets that we bought.
So that's pretty good.
Yeah. That's an astounding deal. Maybe talking about AnHeart, do you own any royalties to AnHeart on top of the 5.5% royalty?
No. We own AnHeart. We fully bought AnHeart. No royalties involved here, of course. We do owe single-digit royalty to Daiichi Sankyo. This product was initially developed at Daiichi.
OK. That's it. Can you comment a little bit about your ex-U.S., ex-Asia kind of plans?
Of course. You know that. Again, we said that in our conference call. We are getting geared up for launch in the U.S. Incredibly strong and experienced team there. I think the youngest rep we have has like 15 years' expertise in oncology. It's amazing, really, really exciting, really expert team. We are very excited about that. Outside of the U.S., we have already licensed out China to Innovent, a well-known Chinese company that got market authorization early in December and January, depending upon the line. Of course, it takes a little bit of time to get on the RDL. It is not nationally reimbursed, so the dynamic is a little bit different. We have also licensed out Japan to Nippon Kayaku, a very good partner there as well.
We are currently in talks with multiple parties about Europe and kind of the rest of the world, but the biggest chunk, of course, being Europe. We hope to have news on that soon.
Great. I think yesterday on the call, you kind of told us what we can look forward to as we measure the launch, right? I think you're going to disclose patient numbers perhaps as we launch or maybe n ew.
Prescriptions.
Refills or s omething like that.
That's what we think the most important metric is going to be, the number of patients that we get on therapy and our ability to stack those patients long term. That is what we will look at. We will also look at some real-world testing rates and how efficiently we are getting patients on therapy. We will disclose more about that on upcoming calls.
Great. And when maybe we find out about the gross to net or something like that, do you think how many quarters until that stabilizes with respect to the price?
Yeah. I mean, to your point, we expect, I mean, the value of the drug is a way that patients can stay on drug incredibly long, right, if everything works in the way that it does in clinical trial, which is what we hope for, of course, for everyone's sake. At the beginning, at the launch time, we would try to have as open access as possible because that's what's right for patients. We do hope that our conversation will be fast enough that it's not going to be something really meaningful, just to be clear.
Great. Yeah, looking forward to that. Maybe swapping, obviously, you have a large pipeline, safusidenib, your IDH1 inhibitor. Can you just tell us a little bit about that program? I think yesterday you announced that we may see data in the second half of the year. Can you just outline what we should be looking for in that data set?
Yeah. So what we've released as data so far, I know phase one studies were in two spots, the low-grade and high-grade glioma. And one of the things that has gotten us so excited about safu is that we've shown some response in high-grade glioma, which had never been seen before. Obviously, early trial, early whatever. Still, we had a 17% overall response rate, which might not look like much, especially when we were talking about Tally earlier. That's exactly the point we were making about Tally being such an incredibly high overall rate of response for oncology, right? A 17% overall rate of response in high-grade glioma had never been seen. When you think about the drug on the market, voracitinib today in their early phase trials, it didn't show any response in high-grade glioma.
That's one of the things that get us really, really excited about this program. We also had a pretty good rate of response in the low grade. I mean, 35.
33%.
33%. Yeah, 33% in the Phase 1 study. That is good as well. We are going to release as soon as we can, when we have data, some additional Phase 2 data, especially on the low grade. These data will help us inform the market about the reason why we are so excited by this program and why we are looking at pivotal trials. We are in discussion with the FDA about the design of those.
Just maybe in broad strokes, what are you thinking? You think within reach for this asset, you have low and high grade, I think, depending on the data. I think potentially we could.
Yeah. I think looking at the situation of the market today and the fact that we have something in high grades, which so far seems very different, this is probably going to be two trials. I mean, again, we'll see, depending upon our conversation with the FDA, something for high grade and something for low grade. Yeah.
OK, great. Maybe in general, with your interaction with the FDA, I have to ask this question. Presumably everybody else asks you that. How has it been lately, right, with all the new appointments, turbulence?
Look, I mean, as I mentioned several times, we have an incredibly experienced team, including in regulatory affairs. It's not the first time they have interaction with the FDA about the approval of a product. They have not seen anything unusual. I mean, our interactions are professional. Our interactions are timely. The inspection of our plants went on exactly as it should have gone on. I mean, anything and everything you would expect from an agency doing its work and doing its job, the job they have to do for the safety of the American people. Really, really nothing there for us of any kind of concern. We were very explicit in our call yesterday that we remain totally confident that we will be approved on or before our PDUFA date of June 23rd.
Every interaction we've had with the FDA so far has been totally normal and totally appropriate.
Great. If you have a comment on your drug-drug conjugate programs, I know one you're kind of focusing on BD. For the other one, what can we look forward to?
For the drug-drug conjugate program? Again, as I said, we have finished all those escalations. We are going to now observe the results. We are going to come back with those results. I mean, it depends upon events driven. We do not know exactly. We expect some by the end of the year. That would be logical, considering where we are. By the end of the year, we will have more update on the DDC program and how we are going to take it forward.
On NUV-868 or BET inhibitor, we paused that for now. It did what we had hoped in a phase one study. The premise there is that it's more selective for BD2, almost 1,500 times more selective for BD2 than BD1. It was well tolerated. We could allocate our cash to our later stage programs. We paused for now. We're assessing if it makes sense to take it forward in different indications, but also assessing the opportunity to partner that out to different folks that are interested in that program too.
Great.