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Thank you for standing by. My name is Jordan, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Coherus Oncology earnings conference call. [Operator Instructions] I'd now like to turn the conference over to Jodi Sievers, Head of Investor Relations for Coherus Oncology. You may begin.

Thank you, Jordan. Good afternoon, and welcome to Coherus Oncology's Second 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. Actual results may vary significantly, and we undertake no duty to update or revise any forward- looking statement. Please see the press release that we issued today and our quarterly report on Form 10-Q for more information on risks and uncertainties. And now I'll turn the call over to Denny.

Thank you, Jodi, and welcome all. In Q2 2025, we completed our strategic repositioning and renamed our company Coherus Oncology to better reflect our mission. Today, in addition to reviewing the progress we made in growing our commercial revenue and advancing our clinical oncology programs ahead of key data readouts in the first half of '26, I want to take the opportunity to introduce you to our new company and highlight what sets us apart. Today, I'll be focusing for you on three main points of Coherus Oncology. First, who we are as a company in terms of science, products and mission. Second, what we are doing clinically and strategically to advance that mission through combinations of products and collaborations with partners. And third, why our proven track record in deals and partnerships and in development gives us confidence we will successfully execute globally on our plans, creating significant value for our U.S.-focused business. First, let's talk about who we are. Coherus Oncology is a commercial stage innovative company built on deep science, focused on developing cutting-edge cancer therapies. Our goal is to deliver a step change in survival for cancer patients using new generation, first-in-class and best-in-class therapeutics. Our science is reading through the clinical results and patient benefit. For example, our next-generation PD-1 inhibitor, toripalimab has a unique FG loop binding site and significantly higher potency compared to standard of care PD-1s and this has translated to demonstrated efficacy in low PD-L1 cancers. While other standard of care PD-1 treatments have lost approval for low PD-L1 esophageal cancer in the U.S., toripalimab has been approved across all PD-L1 levels for first-line esophageal in the EU, validating its genuine mechanistic and clinical differentiation. Approved for use in recurrent or metastatic nasopharyngeal cancer, LOQTOR

Thank you, Denny, and good afternoon, everyone. I'll start with a review of our clinical program for CHS-114 before moving on to casdozokitug. Given the biology, CHS-114 has potential utility in multiple areas, and we have active trials across several tumor types. Firstly, in second-line head and neck squamous cell carcinoma, where the rationale for exploration is several fold. First, this is a tumor type that is well supported by high target expression in terms of the prevalence and density of CCR8-positive Tregs in the tumor. Additionally, this is an indication synergistic with the current indication for LOQTOR

Thank you, Rosh. Q2 marked the first quarter when we operated as a dedicated innovative oncology company. This enabled us to maintain a singular focus on educating physicians on LOQTOR

Thank you, Sameer, and good afternoon, everyone. Today, I will limit my discussion to key financial updates and refer you to our earnings press release for the second quarter and year-to-date 2025 figures and detailed results. I'm happy to report that Coherus has made strong progress on its operational and financial transition, fully consistent with our plans outlined in last quarter's call. Following the close of the divestiture in April, we used a portion of the $483 million in upfront cash proceeds to complete the payoff of substantially all the $230 million convertible notes as well as buy down the UDENYCA royalty obligation. We ended Q2 with $238 million in cash and investments, and we project sufficient cash to provide runway through 2026 beyond key data readouts. Cash burn continues to moderate as per plan quarter-to-quarter in 2025 as we wind down the transition service agreement activities associated with the divestiture and settle pre-close remaining liabilities. The majority of the $97 million in accrued rebates, fees and reserves of the balance sheet, down from $148 million last year, will be settled over the coming quarters through 2025 and 2026. I'm also pleased to report in Q2, we achieved additional progress on managing of our cost structure and expenditures. We now expect to save approximately $30 million on an annualized basis from Q2 headcount reductions, up from $25 million communicated in Q1. This includes the employees transitioned in the divestiture and other reductions initiated during Q2. We remain on track per plan to be at 150 FTEs or less by year-end, which will yield an additional approximately $5 million in annualized savings over the Q1 guidance. Exiting the legacy business has allowed us to simplify our operations and reduce operating costs, particularly as they relate to supply chain and commercial activities. Net of non-reimbursed transition service costs, SG&A incurred solely for Coherus programs and expenses for the full year 2025 is projected to be between $90 million and $100 million. R&D expenses will be a function of data readouts in our ongoing portfolio prioritization process, and we'll be able to provide more detail on that later in the year. With that, I'll hand it over to Denny.

Thank you, Bryan. Let me close with a few key points that reflect the strength of our company, our focus on our drugs, our data and our deals with effective execution making it happen. The science behind our drugs is first rate, next-generation, first-in-class and arguably best-in-class, addressing very large markets. Our data, our science is already and continues to translate strong clinical data, step change survival benefit to patients. Strong clinical execution is keeping us on track to turn over key data cards in the first half of next year, meeting your expectations. And then there's our deals. Excellent deal execution defined our strategic transformation into a focused innovative oncology company, and it will now unlock significant pipeline value through ex-U.S. licensing deals, which will do three things over the next 6, 12 and 18 months. First, validate our science and our products; secondly, monetize our global rights with upfront; and third, offset our global development cost for the future. And in the U.S., we will seek collaborations that expand our labels cost efficiently through combinations with development partners. Strong execution across all three of these dimensions will deliver value to shareholders and is enabled by world-class advisers and Board members working integrally with our team. We expect our strong balance sheet to support operations through '26, well beyond our key clinical catalysts. Operator, we're happy now for you to open the line for questions.

[Operator Instructions] Your first question comes from the line of Brian Cheng from JPMorgan.

Maybe let's start off with the pipeline. As you think through your CCR8 program, your 114 program in your overall approach in the near term, can you just talk about how important it is to identify a partner to -- perhaps regional partners to accelerate some of the progress that you have made in the near term? And if there is interest in that, when do you think it will be a good time to look for a partner here? And then I have a follow-up.

Yes. Thanks, Brian, for that. First of all, Rosh, do you want to recap for us when we will see the data cards turned over for 114?

Yes, absolutely. Thanks, Brian, for the question. So we will -- for both molecules, actually, we anticipate seeing both efficacy and safety data in the first half of next year. But specifically for CHS-114 for our head and neck program, we -- again, we will see efficacy and safety data in the first half of the year, building, of course, on the data sets that I've -- the very encouraging data sets actually that I've previously communicated. For gastric and esophageal for 114, we anticipate safety in the first half of the year and then efficacy in the second half of the year.

So Brian, we're funded through those studies with the product. But as I indicated in my prepared remarks, we expect partners to work collaboratively with us and help us offset these development costs. And I think the issue of the timing really strikes also to the development of others. Theresa, do you want to add a comment?

Yes. Thanks, Brian. I think there's a couple of key data sets as we look as we -- Rosh outlined that we'll be getting to a recommended Phase II dose. So that simplifies the development and I think makes it more attractive for partners in other regional areas. Additionally, what we showed at AACR and besides just Treg depletion and clinical response, we showed a marked infiltration of CD8 T cells, which really has caught the attention of several folks because that clearly lends itself to combinations with other modalities outside of toripalimab, such as T cell engagers. And so I think what we're having is active conversations with people to look for the right partner, both to test other tumor types as well as other combinations and then folks that are prioritized are tumor types where we expect to see efficacy and look at other regions. So all of those conversations are ongoing, but I think it will be really important for us to find a partner that can run with us and not complicate the speed at which we want to move this program.

And I would add two other points for you, Brian. First of all, the CCR8 Treg depleter class is under vigorous development, as you know, globally. And there are data sets being put forward at various meetings. And we would expect that, and we would expect those data sets sometime over the next 6 to 12 months, say, to accelerate. We think 2026 will be the year that CCR8s come to the fore. The second point, as Theresa indicated, is that we're very open-minded with respect to combining our CCR8 with others' drugs. We're not constraining ourselves just to our own portfolio. We think there's broad applicability for the mechanism of action here, and we intend to take advantage of that.

Great. And then maybe just one quick one on LOQTOR

Thanks, Brian. Sameer, do you want to handle that?

Yes. Thank you, Brian. First of all, let me just kind of answer that. So we feel pretty confident. We expect that we'll get to peak revenues by 2028. And just one piece of anecdotal evidence that gives us confidence. After the NCCN guidelines were updated, we saw a pretty strong uptake in the academic setting, in the hospitals and the head and neck specialists. They're the ones who are waiting for the guidelines updates. And once the guidelines got updated, we communicated the data to them. They really jumped on the bandwagon. So what we need to do now is do the same thing and educate the community on our data sets. So we feel pretty confident, Brian.

Your next question comes from the line of Michael Nedelcovych from TD Cowen.

I have two. My first question is on the anti-CCR8 program. You mentioned competitor readouts that could serve as sort of stocking horses for your molecule. Are you aware of any as you survey the competitive landscape that would -- that you would consider proof of concept for the mechanism, so perhaps a randomized trial? That's my first question. And then my second question is actually on the competitive landscape for your anti-IL-27. I know you have the potential here to be first-in-class. Have you seen any follow-on molecule -- any follow-on programs from competitors? Are there other anti-IL-27 molecules in development that perhaps we don't know about?

Thank you, Michael. Thoughtful and very pertinent questions. Theresa, do you want to address the competitive profile, both on the two molecules, CCR8 and casdozo?

Yes. I'll start with the second line first, casdozokitug. We are not aware of anyone else going into clinical development with an IL-27 antagonist. And we have garnered a lot of interest from partners with the HCC CR rate to continue those discussions. For the CCR8, what I find compelling is every time we see a data card turned over, we're seeing efficacy. We saw at ASCO this year that Renovo presented data in pancreatic cancer showing a 22% overall response rate, I believe, in combination with toripalimab, which is quite impressive in refractory pancreatic cancer. Additionally, Shionogi, with their IgG1 wild-type antibody, so a less potent molecule than ours, showed a complete response and a PR in colorectal cancer, a tumor type that really MSS colorectal cancer has been underserved. So as we see each data readout come, it's looking quite interesting. The only randomized study that has been reported publicly is Renovo advancing in MSI-high colorectal cancer. So we actively control clinicaltrials.gov and the reporting of these molecules as we've heard a lot of buzz in the community and expect to see updates in the next year from other folks as well as our own programs.

Yes. I just dovetail on Theresa's remarks, Michael, there is, of course, robust development activity across a number of big pharmas. No one's talking very much right now. But we suspect over the next 6 or 12 months, there's going to be quite a bit of data come to the fore, certainly maybe next year by ASCO.

The next question comes from the line of Colleen Kusy from Baird.

A few from us. You spoke about on the commercial side, making some investments into the community that's largely untapped right now. Can you just walk us through those? And when you expect those might bear out into the sales trajectory? And then I have a couple of follow-ups, please.

Sameer, do you want to handle that?

Yes. Thank you, Colleen. So the community -- one of the dynamics of the community is that there's -- we have to target at least 3x as many physicians in the community as the academic setting. And the number of patients in the community is very dispersed. So each physician sees maybe 1 or 2 patients a year. So -- but at the same time, we can't ignore the community because half the patients are in the community. So what's going to happen is we're focusing -- now refocusing our efforts on the community, both from the sales force standpoint, digital standpoint. And we're also purchasing a lot of data to identify the physicians with the patients at the time of diagnosis. So that whole multipronged approach is underway. But I think because of those dynamics, the time for us to really get to peak sale is going to be about those 3 to 4 years because making a difference in the community is going to be an ongoing process.

Do you have a follow-on question, Colleen?

Yes. I know historically, you -- and you spoke to, you out-licensed LOQTOR

I'll handle the first one, and I'll let Theresa handle the second one. To be clear, we have not out-licensed LOQTOR

Yes. On the last call, we talked about STORM Therapeutics having those study ongoing and enrolling in both head and neck cancer and lung cancer, two tumor types that complement the data sets we have in hand for tori. I mean, I can't speak for how they would disclose data, but knowing that team, I would anticipate some update next year. The other studies are on track to start. And additionally, we would look towards more announcements later this year. We're now only announcing them when first patient is dosed. So we don't have to wait a long time for data. So hopefully, next year, we'll see some data readouts.

The other point I would make pursuant to your question is a point though that Theresa makes frequently is that if you are a company developing a new therapeutic, you want to make sure that you have a highly active next-generation PD-1. We're not constrained to using the standard of care, which will go biosimilar in a few years, in 2020 or whatever. So the interest that we have had in terms of partnering and co-development, I think, is driven from that is LOQTOR

Great. That's really helpful. And then last one for us. Just on the randomized Phase II for casdozo/tori in front-line HCC. Can you just comment on how enrollment is going there?

Rosh, how is enrollment going?

Yes. Thanks for the question, Colleen. So yes, so recruitment is going well. We are recruiting in the U.S. and in the Far East. So these are active trials that, again, we're on track to report data for in the first half of next year, both for efficacy and safety. Just recall, though, that with HCC in particular, responses can take a little bit of time to mature and become more kind of deeper as well, which is what we saw in our earlier trials. So bear that in mind as well, but we're on track with improvement.

Your next question comes from the line of Li Chen from H.C. Wainwright.

This is Li Chen for Doug Tsao. Congratulations on the quarter. So maybe to start with, I'm curious to know if you still follow the first- line HCC patients treated with the triplet of carbo, atezo and bev. And if there's any insight into the durability there? Or maybe when should we expect those data to be presented? And then I have a follow-up.

So the data set that you referred to is with the atezo triplet data, and we did present the final data in January of this year at ASCO GI. And that was the data set that I referred to in my prepared remarks with an overall response rate of 38%, a CR rate of 17%, which compares obviously favorably with current benchmarks. So that trial is the atezo trial. The trial that we report -- that's ongoing right now and that we will report out next year, early next year initial -- in terms of initial data is the toripalimab, casdozo, bevacizumab triplet, right? So we've switched obviously to our own PD-1, and that's the 72-patient study that I described.

I see. So I guess I'm asking for PFS and OS data from the initial triplet results. So it sounds like you don't plan to report.

Yes. So the atezo data was reported in January. And in terms of durability, a couple of things I'll mention. Number one, there was a deepening of response over time and also obviously an increase in response rate. And secondly, for those responses, there was durability. The majority of those responses were 6 months or more.

But the PFS was reported at 8.9, so higher than the IMbrave150 and the OS data is still maturing.

Great. And my second question is regarding the next phase in -- the next phase of development in first-line HCC. How do you think about the comparator arms for the Phase III? Do you think the data in first half '26 will be enough for decision-making?

Well, I think we'll have -- so we'll have initial data in terms of efficacy and safety, as I've mentioned, in the first half of the year. But again, in HCC, it can take a little bit of time for the data to mature, meaning it can take a little bit of time for the data -- the full effect to be realized, right, in terms of depth of response. So once we have that, the next stage will -- we anticipate will be a next stage trial, Phase II, Phase III with -- compared to the current standard of care. The majority of -- in the majority of countries worldwide, the current standard of care is atezo/bev. So that's what we anticipate will be the comparator. And again, some of those benchmarks that I mentioned earlier of 38% for us -- for overall response rate compared to 30% for atezo/bev and also 17% CR rate for our combination versus around 8% for the CR rate. That gives us confidence at this stage.

Your final question comes from the line of Jason McCarthy from Maxim Group.

So thinking longer term, given your extensive knowledge of biosimilars, do you foresee any risk of off-label competition when KEYTRUDA comes off patent and begins to face pricing pressure from biosimilars?

Thank you for your question, Jason. I'll let Rosh take a look at that. Rosh?

So yes, thanks for the question. So in NPC specifically, a few points I'll mention. First of all, I think it's very well appreciated that toripalimab is a differentiated PD-1 on its molecular characteristics as well as on some of its clinical characteristics as well. For NPC specifically, we remain the only approved and available therapy within the U.S. So the approval is with us. Secondly, we have really the only positive data compared to -- pembro and nivo do not have positive data in NPC. And thirdly, we are the only preferred therapy on NCCN guidelines with first-line categorization for -- with essentially Category 1 designation in first-line specifically. So yes, we do not anticipate any effect from that perspective.

I would say unequivocally none. There's a failed Phase II study. We are the only labeled PD-1. And I think that there is a good appreciation by physicians of the power of strong data, and our data is very, very strong for nasopharyngeal cancer.

And you have to remember that biosimilars only get the label for the reference product. So it would be…

They would not have a label.

Yes.

Your final question comes from the line of Douglas Tsao from H.C. Wainwright.

I hope I didn't miss it. But I did want to ask about the impact of the guidelines. I think you touched on sort of the difference between the centers of excellence as well as in the community setting. And I'm just curious, are the guidelines sort of permeating or the impact of the guidelines permeating out into the community and it's just taking a little bit longer. Or is it really they are not necessarily following them as closely as what you're seeing in the major academic centers?

That's a good question on the guidelines. Sameer, can you just recap the guidelines for Doug just briefly and how we do it?

Yes. I mean we're very excited about the guidelines. The guidelines put us in a Category 1 preferred position, LOQTOR

There are no questions. That concludes the Q&A session. I'll turn the call back over to Denny Lanfear for closing remarks.

Thank you. Thank you all for joining us on our call. I think as you can see in today's call, we've really hit our stride with regards to the execution, both clinically and commercially and otherwise with the company. Strong balance sheet will keep us moving through next year while we turn over the data cards, and we look forward to seeing you guys at the Baird and the HCW conferences the second week of New York. Thank you.