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Good day and thank you for standing by. Welcome to the Coherus BioSciences First Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. Now, it's my pleasure to turn the call over to the Jodi Sievers, Head of Investor Relations. Please go ahead.

Thank you, Shannon. Good afternoon and welcome to Coherus BioSciences first quarter 2025 earnings conference call. Joining me today to discuss our results are Denny Lanfear, Chief Executive Officer of Coherus; Bryan McMichael, Chief Financial Officer; Dr. Rosh Dias, Chief Medical Officer; Dr. Theresa LaVallee, Chief Scientific and Development Officer; and Sameer Goregaoker, Executive Vice President, Commercial. Before we get started, I would like to remind you that today's call includes forward-looking statements regarding Coherus' current expectations about future events. These statements include, but are not limited to, the following; expectations about repurchasing Coherus' remaining convertible notes, projections of cost savings from headcount reductions, timing for Coherus to release data from its clinical trials, and projections of future expenses. All of these forward-looking statements involve substantial risks and uncertainties that are beyond our control and could cause actual results, performance, or achievements to differ from those implied by the forward-looking statements. These statements are not guarantees of future performance and are subject to substantial risks and uncertainties that are discussed in our press release that we issued today, as well as our quarterly report on Form 10-Q. Forward-looking statements provided on the call today are made as of this date, and we undertake no duty to update or revise any for-looking statement. And now, I hand the call over to Denny.

Thank you, Jodi, and thank you all for joining us today on our Q1 2025 earnings call. First, let me say that with our biosimilar divestitures behind us and our promising innovative oncology business in front of us, we are fully focused on innovative oncology. We are now a commercial stage innovative oncology company with an FDA-approved next-generation PD-1 inhibitor, LOQTOR

Thank you, Denny, and good afternoon. We are pleased to update you on our continued progress in 2025 with key regulatory and clinical translational advancements of our promising pipeline in combination with our next-generation and differentiated PD-1 inhibitors toripalimab. There are 3 key components to Coherus value creation scientific and development strategy. And I will focus my remarks today on what we view as a high potential impact our CTRA targeted antibody, CHS-114. First, let me review for you what Denny alluded to earlier, are elegant and efficient toripalimab label expansion strategy. Our strategy for expanding toripalimab indications beyond MPC in the United States, is first to put in place drug supply collaboration where we evaluate toripalimab with other novel drugs across a variety of mechanisms. We have prioritized collaborations with strong MOA rationale and clinical safety and efficacy data, evaluating tumor types, such as head and neck and lung cancer in clinical trials. These are tumors that overlap with our existing commercial call points. The second area of toripalimab indication expansion is combination therapy with our own pipeline of potent and selective antibodies, positioned in tumor types with strong biologic rationale to establish proof of concept. For each clinical indication that advances casdozokitug or CHS-114 into a pivotal study. That study also advances toripalimab into a potential new indication as a combination regimen. These efforts include casdozokitug in liver and lung cancers and CHS-114 across a wide variety of solid tumor types. Given our recent head and neck cancer presentation at AACR, today I will focus on CHS-114 as we believe CCR8 to be an emerging target that may address unmet medical needs for a variety of tumor types and combination agents and our compound CHS-114 has the requisite pharmacology and clinical proof of mechanism needed for success. For background, key regulatory cells, or Tregs, are known for their ability to suppress effector T cell function in the tumor microenvironment and are associated with PD-1 resistance. Genetic defects with complete knockout of all Tregs in humans, we sit inflammation and auto immunity. Effective drugs targeting of Tregs in cancer patients requires antibody-based strategies that target selective expression of a protein on Tregs and tumors and not in normal tissue and secondly, selective target Tregs and not normal CD8 and CD4 T cells. Immune cells needed for anti-tumor immunity. CCR8 was identified from single cell sequencing experiments of Tregs in tumors and is a G-protein-coupled receptor that is upregulated preferentially on tumor resident Tregs, and has limited expression in other tissues or on other cells, including CD8 and CD4 T cells. While there are over 450 drugs targeting GPCRs and approximately one-third of all FDA-approved drugs target this class of receptors. Only about 5 antibody drugs targeting GPCRs have been approved so far, highlighting the challenges in generating and develop therapeutic antibodies for these receptors. GPCRs are seven transmembrane spanning receptors with a limited amount of protein on the outside of the cell, which makes some difficult targets to generate antibodies with selectivity. Said another way, having an antibody drug candidate that has no off-target binding or non CCR8 protein binding is a challenge. To date, CHS-114 is the only known selective CCR8 antibody. As we profiled some of the competitor antibodies, we identified off-target binding, including one that binds J-chain. This off-target binding has the potential to lead toxicity. Let me now discuss the dosing and clinical biomarker data for CHS-114 that has shown targeting CCR8 results in selective depletion of CCR8 positive Tregs, but not CD8 or CD4 T cells. Furthermore, the safety profile has not shown autoimmunity and has a manageable safety profile to date. Two critical aims for advancing the development of CHS-114 is addressing FDA's project optimum sufficiently to define a recommended Phase 2 dose and establishing that the drug candidate does what it is intended to do, deplete Tregs in the tumor. At the AACR meeting last month, we presented the results from our ongoing clinical trial in a head and neck cancer expansion phase, evaluating treatment with CHS-114 alone or in combination with toripalimab at two pharmacologically active doses. I will highlight the CHS-114 monotherapy dosing and biomarker aspects of the study and Dr. Dias, will further elaborate on the clinical safety and efficacy data. Importantly, paired tumor biopsies, we show that following treatment with CHS-114 and there is greater than 50% depletion of CCR8 positive T regs. These data strongly support the CHS-114 doses as being pharmacologically relevant. And this targeted therapy leads to selective depletion of Tregs in tumors. We are pleased to say that, we recently had a Type C meeting with FDA to review these data and gained alignment on the acceptability of the approach and doses for addressing project Optimus and defining a recommended Phase 2 dose. We are on track for defining the dose early in 2026. The second aspect of the biomarker studies that I want to call out as being a surprise and exciting is that this CHS-114-mediated Treg depletion was accompanied by a marked increase in tumor-infiltrating CD8 T cells. We did not expect T-reg depletion to promote this level of CD8 T cell recruitment in the tumor. Why this is important, is that it is evident that Treg depletion with CHS-114 is a potentially promising combination for immunotherapies broadly. Internally, we are focused on combination with Toripalimab and addressing mechanisms of PD-1 resistance with the aim of bringing treatment to many of the 70% of cancer patients that are underserved by PD-1 inhibitors. Moreover, this impressive increase in tumor immune infiltrate supports combination with T-cell engagers, bispecific antibodies, ADCs, radioligands, and CARs, to name a few. We own global rights for CHS-114, and these exciting and compelling clinical data can support discussions with potential partners to evaluate CHS-114 with agents other than Toripalimab while we work to rapidly advance our sponsored clinical studies. Dr. Dias, will update you further, on clinical data for Casdozokitug and CHS-114. Raj?

Thank you, Theresa. Let me focus on the significant progress we've seen with our internal pipeline of CHS-114 and Casdozokitug, which we're developing in combination with Toripalimab. We're very excited about the positive data with CHS-114, our highly selective CCR8 cytolytic antibody, as its part of an emerging class of immunotherapies with significant potential to impact solid tumor therapies across a number of modalities. The promise, as Theresa explained, is to turn cold tumors hot, enabling immune response and overcoming PD-1 resistance. We're exploring CHS-114 in Head and Neck Squamous Cell Carcinoma as well as gastric cancer, both tumor types where CCR8 density and prevalence are high, and therefore, a strong supporting biological rationale exists for a therapeutic impact. Data is now emerging that validates that rationale. At AACR two weeks ago, we presented CHS-114 data from our Head and Neck Squamous Cell program, which was to our knowledge, the first U.S.-focused trial data presented to-date within the CCR8 class. We reported data from 21 patients with advanced Head and Neck Squamous Cell Carcinoma in late lines of therapy; 12 of the 21 received CHS-114 Monotherapy, and seven received combination therapy of CHS-114 with Toripalimab. We're very excited and encouraged to report that of the seven patients receiving combination therapy, there was one confirmed partial response. This advanced, very late-in-therapy, fourth-line patient with Oropharyngeal Squamous Cell Carcinoma had lung metastases and low Immunogenicity features and had received prior therapy with multiple agents, including a prior PD-1, TKI, and a taxane. Impressively, this patient achieved a 40% reduction in target lesions as well as response in non-target lesions. The fact that we saw this response is impressive for several reasons. First, this was in a very late-line patient who had endured substantial and multiple prior therapies and was additionally refractory to prior PD-1 treatment. This is important to note because the head and neck squamous cell patient population anytime after failure of a first-line agent tends to have very limited additional treatment options in the second-line setting and even more limited in even late line. Additionally, the fact that we achieved a partial response in fourth-line suggests that the CHS-114 toripalimab combination may have reversed PD-1 resistance, in effect, turning a core team of heart. Deep and sustained partial response in this resistant population sets us back very well as we move into the earlier line setting. And our focus moving forward is in the second-line setting, specifically in less refractory patients. Secondly, this clinical observation is scientifically consistent with the biomarker data that Theresa has outlined, which showed impressive T-reg depletion and immune activation, suggesting that the clinical data follows the biology of the tumor. This is consistent with a robust and deliberate biologically driven approach we follow throughout our program. Safety was also accessible and manageable with overall treatment emergent AEs being generally well balanced for monotherapy and combination, which is a very important consideration in this late line population that tends to have a worse performance status. In the CHS-114 study, in addition to the partial response observed, we also report a stable disease in two subjects in the combination arm and four subjects in the monotherapy arm. Considering that this was in a heavily pretreated population that was refractory to prior therapies and in a target where one may not typically expect monotherapy activity. These positive results are highly encouraging. ASCO 2024 last year, we presented data from the dose escalation portion of this trial, reporting a 47% stable disease rate in a heavily pretreated population. These most recent findings are consistent with those data, reinforcing our biological and scientific rationale. We're now actively accruing an additional 40 head and neck squamous cell patients to an expansion cohort of this study in an earlier line therapy, that is second-line patients using CHS-114 in combination with toripalimab and we anticipate reporting results on dating the first half of next year. We've also opened a CHS-114 study in a second tumor type, second-line gastric cancer, where, again, the strong biological rationale and where clinical proof of concept exists. This 40-patient study will explore the same two biologically active CHS-114 dose levels in combination with toripalimab. This multinational study includes both U.S. and ex U.S. sites with an anticipation of results in 2026. As you've heard from Theresa, the T-reg depletion mechanism is synergistic and complementary with other modalities as well as across other tumor types. Accordingly, we're in the process of evaluating additional tumor types and modalities to explore with CHS-114 both on our own and with potential partners. Regarding casdozokitug, our first-in-class IL-27 antagonist, our focus remains on both non-small cell lung cancer and hepatocellular carcinoma. For non-small cell, our focus is in squamous cell carcinoma specifically, where we have seen our signal to date, and we anticipate reporting further news on this program over the coming months. For HCC, our multinational study in first-line explored the triple combination of casdozo in combination with toripalimab and bevacizumab active and is currently accruing patients. As a reminder, this study builds upon the very exciting data presented at ASCO GI in January, which reported an overall response rate of 38% with a 17% CR rate with casdozo and bev combination with the atezo. Importantly, this compares very favorably with current standard benchmarks in this setting where no other agents have reported CRAs in double-digits in the Phase 3 setting. Our safety profile was consistent with the atezo/bev alone. We're currently actively accruing patients in the toripalimab triplet study exploring two biologically active dose of casdozo in combination with Tori and BEV compared to Tori-BEV-alone in a total of 72 subjects. The objective is to address project optimists and provide contribution of components as we advance the development pathway to Phase 2/3. With that, I'll hand over to Sameer. Sameer?

Thank you, Rosh. Over the course of Q1, the commercial team has been focused on two priorities. First, concurrent with the UDENYCA divestiture, we remapped territories, updated customer assignments and assess our talent pool for the highly clinical cell demanded by LOQTOR

Thank you, Sameer, and good afternoon, everyone. Today, I will discuss the successful closing of the UDENYCA divestiture, which occurred at the beginning of Q2 and the related discontinued operations presentation reflected in Coherus' financial reporting. I will then conclude with the first quarter 2025 results. In accordance with the relevant accounting rules, the results of the biosimilar business, which comprises UDENYCA, CIMERLI and YUSIMRY have been collapsed into a single discounted operations line in the Coherus’s team. The balance sheet includes a similar treatment. This presentation is retroactive, so comparative periods such as Q1 2024 have been recast. The remainder of the P&L comprises continuing operations, including LOQTOR

Thank you, Bryan. With our strategic transformation now complete, we are well positioned to execute on our mission to bring innovative therapies that extend the survival of the cancer patients while building a sustainable oncology franchise that delivers long-term value for our shareholders. We're happy to open the line for questions. Operator?

Thank you. [Operator Instructions] Our first question comes from the line of Kripa Devarakonda with Truist Securities. Your line is now open.

Hey, guys. Thank you so much for taking my question, and congratulations on all the progress, especially with CHS-114 presentation at AACR. I have a question on LOQTOR

Thank you, Kripa. Let me start with the last point first. I want Theresa [ph] LaValle address the issue of the FDA changes treatment.

Sure and thanks for the question. Obviously, we spent a lot of time observing what changes are occurring and also trying to keep our fingers on the pulse. But the aspects that I think are to our advantage is as the FDA has staff that's turning over, you're losing some of the experience there, and so having well thought through high-quality packages with strength of development really is an advantage to people with strong development expertise. And so I think that we always do that, Michael, is to have the packages we submit very readable, describing how this is in line with the guidance, and exactly what we're doing and why. Our experience to-date has not seen anything. We had -- we were surprised to get a Type B meeting instead of just written responses only for dosing discussion. And the other thing I'll say is going through challenges is something that I think we've done repeatedly. So, getting tori approved through COVID, travel restrictions to China was not your usual rule book, but we just will find a way to get it done.

Just to dovetail Theresa's remarks before Sameer addresses your second question, Kripa, we were the first ones out of the gate with pegfilgrastim biosimilars, they were handing out a lot of complete response letters at the time. We were there when the FDA changed direction with respect to the applicability of Chinese data. And I think this is a business really where you just have to adapt and do good science, as Theresa said, and feel very straightforward with the FDA. And we have a very strong track record of doing so. Now, regarding your questions about tori and the inflection point for the sales and secondarily, any issues in housing clinical trial program can increase awareness, I'll let Sameer address that. Sameer?

Thank you for the question, Kripa. So, let me add a couple of points here, right? So, what we're really excited about Q1 was we saw 15% growth in end user demand. So, these are real physician-level patient demand that we saw increasing in Q1. We also saw an increase in the breadth, we define that as a number of new accounts starting LOQTOR

Thank you, Kripa.

Thank you so much.

Our next question comes from the line of Brian Cheng with JPMorgan. Your line is now open.

Hey guys, thanks for taking our call this afternoon. Can you clarify what you meant by patient demand LOQTOR

Yes. So we look at revenue and demand in two different things, right? So wholesalers purchasing our products have that going into inventory. And then the end users, which is the actual clinics buying the product from the wholesaler that's the demand. And the demand is usually a direct indicator of actual patient growth because in this release date, physicians are not stocking inventory on their shelves. So two things to remember, right? The revenue reflected by actual demand and inventory and the end-user demand is actually through patient demand.

Yes. Thanks for that question. So we believe that the sales force restructure impact was felt primarily in Q1. We did a lot of work during the restructure phase of retraining the sales force, reestablishing relationships. So we believe that Q2 is going to be a time for us to grow the business, time for us to grow demand. So we expect that Q2 and Q3 will be time for growth for the brand.

Yes. I would just add, Brian, that on the August call, we report Q2, we'll probably have some interesting projections for you and how we'll land for the year and how the sort of the sales team went.

Thank you, Theresa. Michael, regarding your question, how we view the sort of old habit of contributors or PD-1 use and how we're going to address that regarding using the new NCCN guidelines. I'll let Sameer offer you a little more color for you.

So again, the Keytruda and chemo only use is real. It's real, especially in the community setting, less for the academic setting. And this is despite the NCCN guidelines recommending a chemo combination, including LOQTOR

Thank you, Sameer.

Thank you, Mike.

Our next question comes from the line of Colleen Kusy with Baird. Your line is now open.

Great. Good afternoon. Thanks for taking our questions and congrats on the progress. Can you talk a little more about the Type D meeting you had with the FDA for CHS-114? It sounds like you aligned on project optimists, but any other interesting feedback coming out of that meeting?

Thank you, Coleen. Theresa?

Yes. I mean the focus of that, I mean -- so our approach is to collaborate with the FDA and not just show up with data but really have a conversation about our approaches and how we do things. So the Type D meetings in particular, are very focused on single topics and that was -- I mean, project optimist is something a lot of people have struggled with. And so really walking them through the data we have and the data we plan to bring to them early next year and ensuring that this would meet what they're looking for was important and I think very exciting that they found it acceptable.

A positive development.

Yes. I mean, of course, it always depends on the data, which is what they'll always say. But they didn't say go do five other things or change this.

That's helpful. And then following the restructuring of the sales force, can you speak to the level of interest in potentially adding another commercial stage asset to further leverage the existing infrastructure?

That's a very interesting topic. Certainly, I would offer you this. We think that it's probably another 12 months or so before Sameer and his team really get the doctors sort of trained and focused and I think routinely writing all the scripts with LOQTOR

Got it. Thanks for taking my questions.

Thank you, Colleen.

Our next question comes from the line of Douglas Tsao with H.C. Wainwright. Your line is now open.

Hi. Good afternoon. Thanks for taking the questions. Just one as a follow-up in terms of educating physicians, I'm just curious, is it the -- sort of -- does it take convincing a physician in terms of the value of a PD-1? Or is it sort of demonstrating the value of LOQTOR

Well, let me get that one first, Doug. I'll let Dr. Dias address that. I want to say that the clinical data is irrefutable and the positioning on the NCCN guidelines reflects that. Rosh, can you talk about how physicians view the data that we're presenting. If you were a physician prescribing for your patient, how you would -- what lens you would use?

Yeah. Thanks for the question, Doug. So a couple of points I'll make. So first of all, up until now, you know there's been no approved therapies and no data actually in this tumor type. So this is a real area of unmet medical need. So we've come along with the first real data, the first positive data. And as you know, what LOQTOR

Yes. I just want to make one more comment. Just one thing I'd like us to remember is just 3 months ago, the NCCN guidelines basically were saying, you can use either LOQTOR

Sure. Can I get a follow-up? I think Rosh, you referenced sort of positive experience of physicians being experienced. I'm just curious, when they talk to you, are they speaking -- I'm sort of curious, what are they speaking to when they say that they're having good experiences early on. Are they seeing patients with extended survival, partial responses? I'm just curious if you could sort of characterize what doctors are seeing? Thank you very much.

Yes. Generally, they're saying that what the data -- I mean, it's going to be variable from patient to patient, right, depending on whether it's metastatic patients or recurrent locally advanced patient. But generally, what they're saying is the data that we count he clinical trial, we're able to see those experiences in their actual patients.

Thank you. I would now like to turn the call back over to Denny Lanfear for closing remarks.

Thank you, operator, and thank you all for joining us today. Regarding our upcoming presentation schedule, next week, we'll be attending the HC Wainwright BioConnect Conference at NASDAQ in New York. Then on May 27, we will be presenting at the TD Cowen Sixth Annual Virtual Oncology Innovation Summit. And later on in June, we'll be at the Jefferies Global Healthcare Conference in New York. We'll see you all there. Thank you.