SYRS - Syros Pharmaceuticals Inc. (SYRS) CEO Nancy Simonian on Q2 2022 Results - Earnings Call Transcript

Syros Pharmaceuticals, Inc. (SYRS)

Q2 2022 Earnings Conference Call

August 09, 2022 08:30 AM ET

Company Participants

Courtney Solberg - Manager of Corporate Communications & Investor Relations

Nancy Simonian - Chief Executive Officer

David Roth - Chief Medical Officer

Jason Haas - Chief Financial Officer

Conference Call Participants

Phil Nadeau - Cowen & Company

Jason Butler - JMP Securities

Mark Breidenbach - Oppenheimer

Presentation

Operator

Good morning, and welcome to Syros Pharmaceuticals Second Quarter 2022 Financial Results Conference Call. At this time, all participants are in listen-only mode. This call is being webcast live on the Investor Relations and Media section of Syros' website at www.syros.com. Please be advised that today's call is being recorded.

At this time, I would like to turn the call over to Courtney Solberg, Manager of Corporate Communications and Investor Relations at Syros.

Courtney Solberg

Thank you. This morning, we issued a press release announcing our second quarter 2022 financial results and a broader business update. The release is available in the Investors and Media section of Syros' website at www.syros.com. We'll begin the call with prepared remarks by Dr. Nancy Simonian, our Chief Executive Officer, Dr. David Roth, our Chief Medical Officer, and Jason Haas, our Chief Financial Officer. We will then open the call for questions. Kristin Stephens, our Chief Development Officer; Dr. Eric Olson our Chief Scientific Officer; and Conley Chee, our Chief Commercial Officer are also on the call and will be available for Q&A.

Before we begin, I would like to remind everyone that statements we make on this conference call will include forward-looking statements including statements related to our planned strategic merger with TYME Technologies and concurrent private placement. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors including those set forth in the Risk Factors section of our annual report on Form 10-K and our quarterly report on Form 10-Q that we filed this morning and any other filings that we may make with the SEC in the future.

In particular, to the extent to which the COVID-19 pandemic continues to impact our operations and those of the third parties on which we rely will depend on future developments, which are highly uncertain and cannot be predicted with confidence. Any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements.

I would now like to turn the call over to Nancy.

Nancy Simonian

Thank you, Courtney. Good morning, everyone and thank you for joining us today. In the past months, we've made important progress towards building Syros into a late-stage company with a portfolio of small-molecule medicines that have the potential to deliver new standards of care for patients with cancer.

Syros enters the second half of this year in a position of strength.

Our clinical programs are progressing well and we are on track to have multiple data readouts over the next 18 months. This includes pivotal data from our SELECT-MDS-1 trial and data from the safety leading portion of the SELECT-AML-1 Phase 2 trial and the Phase 1 trial of SY-5609 in pancreatic cancer.

Today, we are pleased to report promising preliminary data from our dose confirmation study of SY-2101, which supports advancement of 2101 toward our Phase 3 trial, which is expected to initiate in the second half of 2023. Additionally, as we announced in July, we expect to secure approximately $190 million through a merger with TYME Technologies and a concurrent pipe investment both of which are expected to close in the second half of 2022.

Together, along with the previously announced amendment to our loan agreement with Oxford, we anticipate these transactions will extend our cash runway into 2025, at least one year beyond the expected pivotal data from our ongoing SELECT-MDS-1 Phase 3 trial. We are incredibly grateful to our new and existing investors for their support as well as to the TYME team for their collaboration throughout the strategic process. We look forward to maximizing value for patients, our combined company and our shareholders in the months and years ahead.

I will now turn the call over to David, who will review the recent progress we have made across our clinical and preclinical programs.

David Roth

Thank you, Nancy. We're pleased to report promising preliminary data today from our ongoing dose confirmation trial of 2101, our novel oral form of arsenic trioxide or ATO. As a reminder, this is the first crossover study directly comparing 2101 to the approved dose of IV ATO and provides important data for our Phase 3 dose selection. In this trial, patients with acute promyelocytic leukemia or APL received a single dose of 2101 in the fasted and in the fed states as well as IV ATO. And Syros PK measurements are taken after each administration.

The goal of this study is to directly compare the AUC and Cmax of 2101 to IV ATO. Safety from the ongoing study, continues to support that 2101 has a favorable tolerability profile. No severe adverse events have been reported in this study, and no new safety signals have been identified in particular with respect, to liver toxicity or cardiac QT prolongation, which have been associated with IV ATO.

Based on preliminary data with full PK data sets in our study, 2101 at a 15-milligram dose achieved exposures based on AUC and Cmax that were comparable to IV ATO, when administered at 0.15 milligrams per kilogram, the approved dose. Additionally, 2101 showed high oral bioavailability of approximately 80%, which is the first quantitative assessment of the oral bioavailability of 2101 in the context of this intra-patient crossover study.

Furthermore, across multiple patients treated with 2101 at 10 milligrams or 15 milligrams, which includes those from the original PK study conducted by Orsenix, we continue to be encouraged that we will be able to identify a dose, that can achieve exposures consistent with those of IV ATO for the planned Phase 3 trial. This preliminary data provides further confidence, that 2101 has the potential to replace the standard of care IV treatment for APL, which is incredibly burdensome both for patients and the health care system.

We're continuing to enroll patients in our dose confirmation study and expect to identify the optimal dose to advance into our planned Phase 3 trial, which is expected to initiate in the second half of 2023. Additionally, in July, we received feedback from the European Medicines Agency or EMA on the pivotal development plan for 2101, which together with prior feedback from the FDA, informs our decision to move forward with a single registration trial that can support the approval of 2101 in both the US and EU.

Turning to tamibarotene, our selective and potent RAR alpha agonist, tamibarotene has the potential to set a new treatment paradigm for RARA-positive patients, who overexpress neurology with higher-risk MDS and newly diagnosed unfit AML. The SELECT-MDS-I trial is on track and we expect to report pivotal data in late 2023 or early 2024. We currently have over 50 sites, opened globally and expect to open additional sites in the months ahead.

Importantly and as we disclosed in June, based on data from over 175 patients, we now estimate that approximately 50% of MDS patients are RARA positive, which we believe has positive implications both for enrollment in our ongoing study, as well as the market opportunity long term.

Also in August, we announced that the EMA issued a positive opinion on our application for orphan drug designation to tamibarotene, for the treatment of MDS. Medicines that meet the EMA's orphan designation criteria, qualify for financial and regulatory incentives including a 10-year period of market exclusivity, after product approval protocol assistance from the EMA at reduced fees, during the product development phase and access to centralized marketing authorization.

As a reminder, tamibarotene was granted orphan drug designation in MDS by the FDA in February of this year. These agencies decisions represent an important milestone for MDS patients, who are in need of effective, tolerable and convenient treatment options. Despite successful advancements in blood cancer more broadly, MDS has largely lagged behind in drug development.

Hypomethylating agents or HMAs, remain the existing standard of care and provide limited efficacy. No new therapies outside of HMAs have been approved in over a decade. We believe tamibarotene, which has a novel mechanism and has demonstrated favorable tolerability and strong efficacy has the potential to be the first therapy for a targeted patient population in higher-risk MDS.

As you know, we're also evaluating tamibarotene in the SELECT-AML one Phase II trial in RARA-positive patients with newly diagnosed unfit AML. About a-third of unfit AML patients, do not respond to the standard of care venetoclax and azacitidine and a majority relapse.

Our translational and clinical data support the potential for the RARA biomarker to enrich the patients, more likely to respond to tamibarotene and for whom the standard of care may be suboptimal. The SELECT-AML-1 trial is evaluating the triplet regimen of tamibarotene, venetoclax and azacitidine in RARA-positive patients with AML, and we look forward to providing clinical activity and safety data from the safety lead-in portion of the study in the second half of this year.

We believe that data with our triplet regimen will provide an understanding of safety, as well as an early look at efficacy based on objective assessments of response rates and time to response. Additionally, we plan to initiate the randomized portion of the trial in approximately 80 additional RARA positive patients, with data from the randomized portion expected in 2023 or 2024.

Finally, I'll turn to 5609, our highly selective and potent oral CDK7 inhibitor. 5609 is being evaluated in the ongoing Phase I trial in combination with chemotherapy in patients with relapsed/refractory pancreatic cancer. Currently, the only approved agent for second-line pancreatic cancer is ONIVYDE in combination with 5-FU leucovorin, which offers an average progression-free survival of approximately three months.

The Phase I trial of 5609 remains on track to report clinical activity and safety data, from the safety lead-in portion later this year. Based on these data, we will determine the best course for further development of 5609. We're also pleased that the arm of Roche's ongoing Phase I/Ib intrinsic trial evaluating 5609 in combination with atezolizumab a PD-L1 inhibitor in BRAF mutant colorectal cancer is now actively enrolling patients.

We're very encouraged by continued momentum across our clinical portfolio, and look forward to sharing additional data in the coming months as we learn more about the potential of each of our investigational therapies to change the standard of care for patients.

Next, I'll turn to our gene control discovery engine. In July, we nominated SY-12882, our oral potent and selected CDK12 inhibitor as our next development candidate. Preclinical data presented at AACR in April demonstrated that selective CDK12 inhibition decreased DNA repair and caused cell-cycle dysregulation and genomic instability, leading to tumor growth inhibition and apoptosis in preclinical models. Additionally, selective CDK12 inhibition as a single agent induced tumor regression model of small cell lung and breast cancer, and demonstrated activity in combination with lurbinectedin in a small cell lung model, as well as with olaparib in a PARP inhibitor resistant patient derived the xenograft model of ovarian cancer.

This nomination is a testament to our gene control discovery intimate and Syros' leadership in selective CDK inhibitors. As we announced also in July, we're exploring partnerships for 12882, as well as for our CDK 11 and WRM programs. We are confident this approach will allow us to robustly advance each of our discovery programs as we focus our capital on our clinical assets, which have the potential to deliver the greatest benefit to patients in the near term.

With that, I'll turn the call over to Jason to review our financial results.

Jason Haas

Thank you, David. We are excited to be entering the second half of 2022 in a strong financial position. As Nancy mentioned in July, we announced a definitive merger agreement with TYME Technologies, where we have agreed to acquire TYME, including its pipeline assets and net cash of approximately $60 million.

We also announced a pipe financing through which new and existing investors agreed to invest $130 million in our combined company. The pipe was led by a life sciences focused investment fund and also included new and existing Syros shareholders such as Flagship, Avidity, Deep Track, Bain, Invus, Samsara, Adage, Ally Bridge, and Cowen Healthcare Investments.

We expect the pipes at close concurrently with the merger in the second half of this year subject to the approval of Syros and TYME shareholders and other customary closing conditions.

Finally, in July, we also announced an amendment to our senior secured loan facility with Oxford Finance, which subject to certain conditions, will extend the interest-only payment period from March 2023 to March 2024 and upon the achievement of certain milestones all the way to September 2024.

Following the close of these transactions, we expect to have a cash balance of approximately $240 million and we believe this capital will be sufficient to fund our planned operating expenses and capital expenditure requirements into 2025, which is more than a year past our expected pivotal data readout from our SELECT-MDS-1 trial and also allow us to build out our commercial operations to support the launch of temperate.

Now, I'll turn to our second quarter financial results. We recognized $6.3 million in revenues in the second quarter of 2022 consisting of $5.7 million from our collaboration with GBT and $600,000 from our collaboration with Incyte. For the second quarter 2021, we recognized a total of $5.2 million in revenue under our collaborations with GBT and Incyte.

R&D expenses were $33.1 million in the second quarter of 2022 compared to 25.8% for the second quarter of 2021. This increase was primarily due to costs associated with the continued advancement of our clinical and preclinical programs and employee-related expenses.

G&A expenses were $6.9 million in the second quarter of 2022 as compared to $5.5 million for the second quarter of 2021. This increase was primarily due to employee-related expenses. Finally, we reported a net loss in the second quarter of $34.5 million or $0.54 per share compared to a net loss of $22.5 million or $0.36 per share for the same period in 2021.

With that, I will now turn the call over to the operator for questions.

Question-and-Answer Session

Operator

[Operator Instructions] The first question comes from Phil Nadeau of Cowen & Company. Please go ahead.

Phil Nadeau

Good morning. Congrats on the progress and thanks for taking our questions. A couple of follow-ups on 2101 if we could. First is there any intra-patient variability in the exposures to 2101, or is it relatively consistent across patients?

And then second I know you mentioned the tolerability profile was good, but specifically are there any AEs associated with oral dosing such as GI toxicity?

David Roth

Thanks Bill. It's David. So, it's a good question about variability. Variability is an important parameter that's going to really help to inform actually the totality of the data set that we need to generate in order to select our go-forward dose.

And we haven't reported on that specifically. But I think what I can say is that we've been very encouraged by what we're seeing and we're confident that we're going to have a dose to move forward with to start our Phase 3 trial in the second half of 2023.

With respect to the adverse events I mentioned that we really haven't had any reports to-date of serious adverse events and -- we've had no real adverse events. So, tolerability profile seems very encouraging. Obviously, there's more opportunity for us to observe potential side effects. But at the moment things are looking very encouraging and we have no reason to expect any future issues with the oral form of ATL.

Phil Nadeau

That's very helpful. In light of the good data that you've seen thus far what still remains to be optimized through the continuation of the study? What parameters are you trying to sell for?

David Roth

Yeah. So again, so I think the main thing that I think we should all appreciate is that IV ATO is dosed at a dose of 0.15 milligrams per kilogram. So the dosing algorithm for the interims form is weight-based adjusted. We've gone in initiating this trial with a 15-milligram flat dose. And we really feel it's important to understand the characteristics of the patients so that we understand the exposures we're measuring and whether there's any influence on those exposures based on characteristics of the patients. Now way it is an obvious one to look at because the IV has chosen to normalize their dose by the way. So depending on the range of rates of the enrolled patients, we'll have a good sense as to whether that is a parameter that influences exposure.

So we just need to feel good about the breadth of the patients who are coming into the trial who are getting dose to see if we can develop an adequate model that helps us determine the relationship between exposure and patient body weight. Obviously, if everyone comes in with the same weight, we're not going to get a lot of insight into that. But obviously that's not going to be the case. So I think that's really the main thing that we're looking at now is just to build out the robustness of our data set and go in with the appropriate model to assure the right exposure or the range of different types of patients who may be treated.

Phil Nadeau

Okay. I see. That makes a lot of sense. Second question on SELECT-AML. You mentioned, we'll get clinical activity measures at the end of the year. And I think in the prepared remarks, you've mentioned perhaps response rates. Are we going to get response rates from SELECT-AML during the second half of this year or will it be earlier measures of activity?

David Roth

Yeah. So look the trial is testing our triplet of Tamibarotene benzene in what we're calling a safety lead-in and that's a pro you to opening the randomized portion of the trial where we'll compare that to the doublet of benzene [ph]. Obviously, we're looking at safety, right? So that's the main thing that we need to demonstrate. But all these patients are being treated actively for newly diagnosed unfit AML. So we're going to have responses bone marrow aspects are being done and all the usual times after one, two, three months and so on and thereafter. So I think it's reasonable to expect that you'll see activity in addition to safety. And those are all the usual measures, right? So our primary endpoint is the CR/CRI rate. So obviously, we'll be looking for patients who have that and we'll be looking at the speed to determining the response and so on and so forth.

Phil Nadeau

Got it. That is very helpful. Thanks for taking our questions and congrats again on the progress.

David Roth

Thank you so much.

Nancy Simonian

Thanks, Phil.

Operator

The next question comes from Jason Butler of JMP Securities. Please go ahead.

Jason Butler

Hi. Thanks for taking the questions. A couple more on 2101. I guess just to confirm is the plan to advance one dose into Phase 3, or could you explore potentially a lower dose as well? And then secondly, can you just remind us of the additional work you need to do after confirming the dose and the profile in the PK study but before initiating the Phase 3 trial? Thanks.

David Roth

Yeah. So we would we're going to establish the dose that we're going to recommend to treat patients with moving into the Phase 3, we haven't finalized that determination. That's why the trial is still ongoing. It may be a specific dose or it may be a weight adjusted dose. So I think that's really I think where we're leaning right now. And in terms of other things that need to be done obviously the obvious things that relate to the trial start-up. And Nancy, if you have any other comments about other activities that are going to happen between now and the initiation of the trial going forward?

Nancy Simonian

Yes. No, I was just going to add Jason that, obviously the selecting the dose finalizing the protocol. And of course, then there's all the manufacturing necessary for the Phase III material to start the Phase II are kind of the things that we're working on right now and feel very confident that we're on-track to -- with all of those activities under needed to start the Phase III.

Jason Butler

Great. And then just on the earlier-stage pipeline programs. You said you're looking to progress partnership discussions. Can you just give us a sense of, what the priority level there is or how earlier advanced into those discussions are? Obviously, I understand you can't give timelines here, but just a sense of how active those discussions are?

Nancy Simonian

Yes. So, first of all I'd just say that, we remain very excited and bullish on our gene control discovery engine the CDK12 inhibitor de novo candidate nomination is, I think it's a great testament to what our scientists can do in terms of selective very potent inhibitors of these important regulatory targets.

As you know as we're focusing now on kind of our late-stage clinical pipeline, we think that it's in the best interest of these programs that we seek partnerships to ensure that we have adequate capital to robustly develop those early programs. So, we have ongoing discussions going on, on the oncology discovery programs and we feel confident in terms of being able to enter into one or more partnerships. But we'll keep you apprised of that.

Jason Butler

Okay. Great. Thanks for taking the question.

Operator

[Operator Instructions] The next question comes from Mark Breidenbach of Oppenheimer. Please go ahead.

Mark Breidenbach

Good morning, guys and thanks for taking my question. Just a few quick ones for me. First with regard to the EMA feedback on SY-21, 01. Did that feedback substantially influence or cause you to change your plans for the design of your pivotal trial in terms of size and end points? Another question is, what's timing looking like for the initiation of the randomized portion of the SELECT-AML-1 study? Is that something we can expect to kick-off kind of later this year, as soon as we see the safety lead-in data?

And one final one for me. very quickly, does the pending GBT acquisition by Pfizer what does that mean for your collaboration? Are you getting any indications that Pfizer would want to continue developing fetal hemoglobin inducers? Thanks for taking the question.

David Roth

Sure. Okay. So, the first question was related to the EMA feedback on 2101. So, we had already received feedback from a very fruitful dialogue with the Food and Drug Administration on our proposed strategy. And it really was important in corroborating our approach and giving us a solid foundation upon which we can move forward with endpoints and benchmarks to assess those endpoints and various things like that. So, we had a good structure for study design to take for also in terms of size.

We took that strategy to the EMA and vetted our approach there and we received general alignment that that strategy was solid. And so we come back from that meeting now an boldened with the notion that we have an opportunity to use one protocol to seek global approvals in both the US and Europe. So that's really very exciting and very strong positive feedback for our go-forward plan.

With the AML trial, obviously, we're on target to report data coming out of the safety lead in the second half of this year, obviously, later this year. And our current plan is to move forward with the randomized portion. As we get closer to that, we'll give you an update on the specific timing of opening the randomized portion of the trial. And then the last one was related to GBT, and I'll let Nancy take that one.

Nancy Simonian

Well, so we are -- we remain really excited about our ongoing collaboration with GBT, which is to develop, sort of, small molecule inducers of fetal hemoglobin which we think is a really great opportunity to treat, kind of, give a functional cure to sickle cell disease patients with an oral medicine.

And obviously, we're incredibly excited for GBT with the news yesterday about the Pfizer acquisition. And I think it suggests to me that there's a real interest in sickle cell disease and thinking about all the ways that we can improve that disease which has been neglected for so long and I think it's very exciting overall for the field to have that potential pending acquisition.

In terms of what we're doing right now it doesn't impact our collaboration, but as we learn more from discussions with GDT, we'll have a better idea about where that's going but as it relates to our relationship. But we think it's actually overall a really positive news for the sickle cell disease community.

Mark Breidenbach

All right. Thanks so much and congrats again.

Operator

Seeing that there are no further questions, I would like to turn the conference back over to Nancy Simonian for closing remarks.

Nancy Simonian

Thank you, operator and thank you everyone for joining us today, and for your continued support of Syros. We look forward to updating you again soon as we advance our portfolio and work to build Syros into a leading biopharmaceutical company. Please reach out if you have any further questions. Thank you.

Operator

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

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Syros Pharmaceuticals, Inc. (SYRS) CEO Nancy Simonian on Q2 2022 Results - Earnings Call Transcript