KYMR - NASDAQ

Good day, and welcome to the Kymera Therapeutics Third Quarter 2023 Results Call. [Operator Instructions]. Please note that this event is being recorded. I'd like to turn the conference over to Ms. Justine Koenigsberg, Vice President of Investor Relations. Please go ahead.

Good morning, and welcome to Kymera's Quarterly Update. Joining me on this morning's call are Nello Mainolfi, Founder, President, and CEO; Jared Gollob, our Chief Medical Officer; and Bruce Jacobs, Chief Financial Officer. Following our remarks and presentation, we will open the call to questions. During the Q&A portion of the call, please limit your question to one and a related follow-up so that we will have enough time to address everyone's questions. Please note that we will be referencing slides in our corporate presentation during Jared's remarks. The slides can be accessed in the Investors section of our website, under Events and Presentations, and will be shown during the call for those on the webcast. Before we begin, today's discussion will include forward-looking statements about our future expectations, plans, and prospects. These statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected. A description of these risks can be found in our most recent 10-Q filed with the SEC. Any forward-looking statements speak only as of today's date, and we assume no obligation to update any forward-looking statements made on today's call. With that, I would now like to turn the call over to Nello.

Thank you, Justine, and thanks, everybody, for joining us today. We're excited to review our recent progress and several critical milestones that the company has achieved. As we are near the end of 2023, I'm extremely proud of the strong execution by our team that has led to continued progress in our clinical studies across multiple programs along with innovative pipeline advancements to support our future growth. Before we detail that progress, I want to share a few thoughts on where Kymera is in our mission to building a best-in-class, fully integrated, global degrader medicine company. In doing so, I hope to provide you with an important lens through which you can view our achievements and our strategic decisions regarding the portfolio. Our unique approach to developing a new generation of medicines using TPD has resulted in a robust pipeline, both in the clinic and underway to the clinic, highlighted by multiple programs that are guided by and consistent with our goal of creating groundbreaking medicines. I hope there is broad appreciation for all that Kymera's accomplished since our founding only seven years ago. We have taken four programs in the clinic, demonstrating fidelity of translation of PK/PD and safety across each of those programs. We have shown early clinical proof of concept for three of them as you will hear soon. Our unique strategy has allowed us to achieve multiple TPD firsts, including conducting the first I&I study in healthy volunteers and patients with KT-474, targeting IRAK4. In addition, we've been the first degrade, and elusive transcription factor like, STAT3. More strategically, for KT-474, we formed a critical collaboration with Sanofi, one of the leaders in the I&I space. And that program is now advancing in Phase II development, with the first patient in the first trial just recently dosed. We have built industry-leading knowledge and capabilities that we're leveraging each and every day. And we have developed a best-in-class pipeline of innovative and highly valuable programs, some of which we would be excited to share with you over the coming months. An important cornerstone of Kymera's success has been our unique approach to target selection, which has several key tenets that guide our strategy and, of course, our research and development efforts. Our focus is and has always been on genetically validated targets that are either undrugged or inadequately drug within pathways with clear validation and where TPD is the best or only solution. Importantly, we target large market opportunities where the unmet needs are significant and where we believe that there is a greater probability and opportunity for significant commercial success. With regards to therapeutic areas, our programs have progressed over the last several years. And as you can see from the pipeline slide on our website and in our corporate presentation, Slide 6, our portfolio is increasingly leaned towards immunology. This is a purposeful strategy orientation guided by several factors that have influenced our strategic and investment decisions. You will hear a more complete overview of this focus at our R&D Day on January 4. But today, I'd like to highlight a few. First, it is clear that I&I is an area where the understanding of the underlying biology has increased dramatically. Second, the large commercial opportunities within I&I are mostly dominated by biologics that have helped validate key pathways and targets, but also create an opportunity for other more convenient modalities. And at last but least for today, to that point, we believe that TPD can provide a unique solution with strong efficacy and biologics-like specificity, but with the flexibility of all our small molecules. Importantly, we hope you all appreciate that we have demonstrated early but convincing evidence of our potential in I&I with KT-474. In fact, we believe strongly that the success we've had with our IRAK4 program will help shape how we approach these new opportunities. We have countless learnings from that program, starting with the development of the molecule itself, including our extensive preclinical work, and the key insight we've gained from running what we believe is the largest healthy volunteers subsequent patient study in the TPD space. And now, KT-474 is undergoing Phase II studies with our partner, Sanofi. This wealth of experience and knowledge gives us a high degree of confidence in our ability to execute on many new opportunities, some of which we will be sharing with all of you in the coming months. We've also made important progress in the clinic with KT-333, which targets STAT3, and KT-253, our MDM2 degrader. Jared will provide updates on both programs later during the call. At a high level, we're very excited that KT-333 will appear in an ASH abstract later this morning and would be featured in a poster presentation, with updated clinical data at the ASH meeting in December. It's important to note that we're seeing early signs of clinical activity, even at those levels that were not predicted to be clinically active, but where we are, nonetheless, seeing robust STAT3 degradation. Jared will share a few highlights on this call. And we will be able to say more once the accepted abstract is publicly released, which should be shortly after our call concludes this morning. We're also excited about early days emerging from KT-253 Phase I dose escalation study. We've demonstrated both proof of mechanism and early signs of clinical activity in initial dose levels, even earlier than we expected. The early clinical activity, lack of thrombocytopenia neutropenia in the presence of antitumor activity makes us optimistic about the translation of anti-grade rationale of increased therapeutic index and full realization of p53 pathway potential. With regards to KT-413, a degrader, we have decided to discontinue the program. Let me first say that this decision is not driven by any clinical data or safety concerns that we have with the program. We are degrading the targets in blood as we had expected, and we have not experienced those limiting toxicities. Rather, our decision to discontinue KT-413 reflects our commitment to the program that more closely fit the previously mentioned strategic focus of the company. More specifically, when we evaluate the evolving healthcare landscape, especially in oncology and the market opportunity and the competitive landscape in the diffuse large B-cell lymphoma and juxtapose that with the enormous opportunities we have in our emerging pipeline, we have decided the right strategic decision is to focus our resources on those high-value programs. It should also be noted that we did not take this decision lightly nor did we make it without thinking about the potential impact on patients. But as many of you already know, the DLBCL market is well served today with numerous active agents. And we believe promising therapies will continue to emerge in the relapsed/refractory and frontline settings. Ultimately, we believe that Kymera can have the greatest impact by focusing on areas of significant unmet patient need where TPD can have the greatest impact. We've built a team with leading expertise in drug discovery and development capabilities, which we believe provides Kymera with a strong competitive advantage. And perhaps, most importantly, as I've already highlighted, we have shown our ability to execute with the development of KT-474, which has achieved another significant milestone with the dosing of the first patient in the Phase II study. At our immunology R&D Day in January, we would provide an even clearer picture of the strategic focus that we're outlining today, highlighted by what we believe are both important and exciting pipeline disclosures. We're confident then, when we share the details around our next program and our strategies for building Kymera into an industry-leading, fully integrated biotech company, you will appreciate our enthusiasm for the enormous opportunities those programs represent. I can tell, and I would likely repeat these when we gather in January, I've never been more encouraged and excited by the pipeline opportunities on which Kymera is poised to capitalize. Finally, Kymera remains very well capitalized, which puts us in a strong position to execute on the opportunities our pipeline presents. As we noted in today's press release, we have extended our runway into the first half of 2026. This takes us well beyond several key catalysts and data readouts that we expect to be important derisking events for our clinical and preclinical pipeline, including Phase II data on KT-474, further POC readouts for our oncology programs, and important updates on our pipeline. More details about which will be shared at an upcoming Immunology R&D Day. Let me pause here and turn the discussion to Jared.

Thanks, Nello. The focus of my comments today will be primarily on KT-333 and KT-253 and new clinical data we are announcing this morning. As Nello mentioned, we're very happy that our clinical abstract relating to KT-333, our first-in-class small molecule degrader of STAT3 was accepted for a poster presentation at ASH. The full abstract will be available online shortly, but I will share a few highlights shown on Slide 29. And we, of course, will be available for follow-up once the full abstract is released. For context, July 10 was our abstract data cutoff date. As of that date, 21 patients have been treated across five dose levels, of which 12 were evaluable for disease response. The patients included a variety of liquid and solid tumors. All our comments today are based on that July 10 cutoff date. The data in the abstract show continued evidence in blood of robust STAT3 protein degradation in humans, with associated STAT3 pathway inhibition with dose levels three and beyond expected to be clinically active, along with potential early signs of antitumor activity. As mentioned, there were 12 evaluable patients in dose levels one through four, of which just two were liquid tumors at dose level two. Of those two liquid tumor patients treated at dose level two, we saw one partial response after two cycles in a patient with CTCL, a T-cell lymphoma, where we saw substantial activity with the STAT3 degrader in a preclinical STAT3-dependent mouse model. Among the 10 solid tumor patients available for disease assessment, which is a group where we do not expect to see monotherapy clinical activity based on our preclinical studies, we saw a stable disease in three patients after two cycles at dose levels three and four. Importantly, from a safety perspective, no DLTs were observed, and no drug-related SAEs were reported. Safety and PD were consistent with previous updates. These early findings are encouraging and support the potential of heterobifunctional degraders for targeting previously undruggable transcription factors implicated in diseases. Accrual is ongoing, and therefore, we expect to present additional data in patients with hematological malignancies, including T-cell lymphomas and leukemias, and solid tumors beyond what is in the abstract. We look forward to providing more details, both after the publication of the abstract today, as well as next month at the ASH meeting at the time of the poster presentation. Additionally, in September, we announced that the FDA granted Fast Track designation for KT-333 for the treatment of relapsed/refractory cutaneous T-cell lymphoma and relapsed/refractory peripheral T-cell cell lymphoma. We're happy that FDA gave this designation to the program as it further highlights the promise of degrading STAT3, a protein that has historically been undruggable for the treatment of patients with CTCL and PTCL. Turning now to KT-253, our MDM2 degrader. We are disclosing clinical data from Arm A of the ongoing Phase Ia trial for the first time this morning. We are pleased to report that we have demonstrated KT-253 clinical proof of mechanism and initial signs of clinical activity in just the first two dose levels in patients. We have slides that highlight some of our results in the corporate presentation posted in the IR section of our website, but I will briefly summarize and we can take questions in Q&A. As shown on Slide 32, KT-253 degrades MDM2, the crucial regulator of the most common tumor suppressor p53. p53 remains intact and close to 50% of cancers, meaning that it retains its ability to modulate cancer cell growth. While small molecule inhibitors have been developed to stabilize and upregulate p53 expression. They have been found to induce a feedback loop that increases MDM2 protein levels, which can repress p53, and therefore limit their efficacy. In preclinical studies, KT-253 has shown the ability to overcome the MDM2 feedback loop, and thereby robustly activate the p53 pathway even with brief exposures. As shown on Slide 33, KT-253 is greater than 200-fold more potent than MDM2 small molecule inhibitors in upregulating p53, and killing p53 wild-type cancer cells. Slide 34 shows that KT-253 more effectively upregulates and activates p53 in tumors in vivo, compared to small molecule MDM2 inhibitors. And this translates into antitumor responses in AML and ALL models with just single doses of KT-253. These results support an intermittent dosing strategy for KT-253 that enables maximum p53 pathway activation for a limited period of time in tumor cells, leading to rapid apoptosis, while mitigating the impact of target engagement in normal cells in order to improve the therapeutic index relative to MDM2 small molecule inhibitors. As shown on Slide 35, the KT-253 Phase Ia trial is an open-label dose escalation study, where adult patients with relapsed or refractory high-grade myeloid malignancies, ALL, lymphomas and solid tumors receive IV doses of KT-253 once every three weeks. The study is intended to evaluate safety, tolerability, PK/PD, and initial clinical activity, and allow us to identify the recommended Phase II dose. It is comprised of two Arms, with ascending doses of KT-253 in each arm. Arm A is in patients with advanced solid tumors and lymphomas and Arm B is in patients with relapsed/refractory high-grade myeloid malignancies including AML and ALL. We dosed our first patient in Arm A, and have fully enrolled the first two dose levels in Arm A, with enrollment to dose level 3 ongoing. Enrollment on to Arm B has also been recently initiated following demonstration of on-target pharmacology and the first two dose levels of Arm A. As of the October 20 data cutoff date, a total of nine patients with solid tumors have been enrolled on to dose levels one through three of Arm A, and have received a mean of 2.3 cycles with a range of one to six cycles. As shown in Slide 36, proof of mechanism has already been demonstrated in the first two dose levels, with exposure-dependent upregulation of plasma GDF15 levels. GDF15 is a transcriptional target of p53, and as such, it serves as a downstream biomarker of p53 upregulation following MDM2 degradation. In addition to the dose proportional increase in plasma KT-253 levels between dose levels one and dose levels two in cycle one, the GDF15 maximum fold increase over baseline during cycle one was 10 in dose level one, and 30 in dose level two. The kinetics of GDF15 change following the cycle one dose is shown on Slide 36, for a subject on dose level one, where brisk upregulation over the first 24 hours after dosing was followed by a recovery towards baseline over the subsequent six days. This was consistent with the pattern of p53 activation in preclinical models associated with KT-253 antitumor activity. Clinical response results for all patients within a dose cohort were available for dose level one, and are shown on Slide 37. Even though based on exposures, we did not expect this dose level to be clinically active, we were encouraged to see that among the three solid tumor patients treated on dose level one, there was one confirmed partial response after four cycles with treatment continuing after six cycles, one confirmed stable disease after four cycles with the patient subsequently discontinued from the study after six cycles for lack of response, and one patient with disease progression after cycle one. The patient with a partial response had Merkel cell carcinoma, metastatic to abdominal lymph nodes and skin who had previously been treated with chemotherapy as well as multiple different immune checkpoint inhibitors. As shown on Slide 37, the lymph node metastases were responding after the first two cycles of treatment as was the skin metastasis. And after four cycles, there was an approximately 60% reduction in nodal tumor burden and resolution of the skin metastasis. There were no dose-limiting toxicities. As shown on Slide 38, the most common drug-related AEs occurring in two or more patients included grade 1, 2 nausea, and grade 1 diarrhea. one patient at dose level one had an SAE of grade 3 hypotension during cycle four that was due to diminished oral intake deemed related to study drug. Treatment included IV fluids in the patient remains on study without dose reduction or recurrence of hypotension. There were no neutropenia or thrombocytopenia AEs even in patients who had received up to six cycles of therapy. In summary, on Slide 39, these promising interim clinical data showing evidence of target engagement and p53 pathway activation, along with initial signs of antitumor activity without DLTs, including typical hematological toxicity, are supportive of our therapeutic hypothesis for MDM2 degraders, and the potential to improve the therapeutic index compared to MDM2 small molecule inhibitors. As we continue to explore the safety and clinical activity of KT-253 in both solid and liquid tumors in Phase Ia, we are also putting together a comprehensive preclinical and clinical data set examining the factors impacting in vivo response to intermittent dosing with KT-253 across multiple different solid and liquid tumor types in order to derive patient selection biomarkers for the next stage of development after Phase Ia. Disclosure of additional clinical data as well as preclinical data, informing a biomarker-based patient selection strategy is planned for 2024. Finally, a quick update on KT-474, our IRAK4 degrader, which is now in Phase II development under the direction of our partner, Sanofi. As we recently disclosed, the first patient in the HS trial has been dosed, and we are excited about the significant milestone for Kymera. In addition, the AD trial recently commenced, and we will report news of the first patient dosed in that trial after it occurs. The details around the study designs for both trials are available on clinicaltrials.gov, and we have a summary on Slide 20. At a high level, the trials are powered to show a treatment effect relative to placebo and will also provide a comprehensive assessment of safety and on-target PD. Dose escalation was informed by the safety, PD, and clinical efficacy data from the patient cohort in our Phase I study, and both trials will evaluate KT-474 versus placebo for 16 weeks. The HS study will enroll up to approximately 100 patients, and the AD study up to 115 patients. Both studies include standard endpoints measuring skin lesion burden and symptoms. In the HS study, these include AN count, HiSCR, IHS4, and pain measures. While in the AD trial, these include EASI score, along with vIGA-AD and Pruritus measures. Both HS and AD represent important indications with significant unmet patient needs, and we're excited to see our partner, Sanofi, advance the program into Phase II. As noted in the clinicaltrials.gov posting, both trials have primary completion dates in Q1 2025, anticipating completion of enrollment in 2024, and top line data in the first half of 2025. I'll pause here and turn the discussion to Bruce to review the financials.

Thanks, Jared. As I review our Q3 financial highlights, please reference the financial tables found in today's press release. For the quarter, we recognized $4.7 million of collaboration revenue, all of which was related to our Sanofi collaboration. At the end of the quarter, our deferred revenue total on the balance sheet was approximately $43.8 million that reflects Sanofi partnership revenue that we expect to recognize over the next several years, excluding the receipt of any potential future milestones. As announced last week, Kymera will receive a $40 million milestone payment, triggered by the first patient dosed in the KT-474 HS trial. We include this milestone and the next milestone we expect for the first patient dosed in the AD study in our cash runway guidance, although it is not reflected in the cash balances at the end of the quarter. Given that both of these payments are anticipated to occur in the fourth quarter of '23, we expect both to initially be recorded as deferred revenue and to begin being recognized as revenue in the fourth quarter of 2023. With respect to operating expenses, R&D for the quarter was $48.1 million. Of that, approximately $5.8 million represented noncash stock-based compensation, making the adjusted cash R&D spend $42.3 million, which excludes that stock-based comp and reflects a 5% increase from the comparable amount in the prior quarter. On the G&A side, our spending for the quarter was $14.1 million, of which $5.9 million represented noncash stock-based comp, the adjusted cash G&A spend of $8.2 million, again, excluding stock-based compensation, reflects a 5% decrease from the comparable amount in the prior quarter. We ended the third quarter of 2023 with $435 million in cash and equivalents under our current operating plan, which again includes the aforementioned portfolio actions. We expect our cash and cash equivalents to fund the company into the first half of 2026. This concludes our prepared remarks, and we'd be happy to now address any questions. Operator?

[Operator Instructions]. First question will be from Brad Canino of Stifel. Please go ahead.

Now, as I read the explanation for the strategic shift away from the IRAK med, I couldn't help but think the same logic could be applied to STAT3 on the cancer side, at least as we think about the monotherapy potential in T-cell lymphomas. So, while I get that these STAT3 studies are also very useful as a proof of concept for your immunology developments, should we still think of STAT3 as having legs for you in oncology? And if so, what form? Thank you.

That's a great question. So first, I just want to reiterate that the 413 was a clear strategic decision based on how we prioritize our pipeline. And again, the landscape in diffuse large B-cell lymphoma. As you know, STAT3 is a broad development program that spans both liquid tumors, solid tumors, as well as areas outside of oncology. So -- I mean, as you know, we have a really high bar on how we make decisions on investing in the next phase of development. So, we'll always have a point in the phase of development where we assess the opportunities ahead of us. Right now, the way that we look at STAT3 is that it is a multipronged development plan, which includes activities in liquid tumors, which we know are limited. But I think we are working both in the clinic and preclinically to flesh out the opportunities in solid tumors. As you know, we've shown preclinically the activity that we've seen with other agents, including PD-1. We are -- during our Phase I studies, collecting tumor biopsies to look at the signature in the tumor microenvironment with respect to how we modulate that. And we're doing other studies that we haven't disclosed yet preclinically to look at combination with this agent in solid tumors. So, I think, I wouldn't say that the STAT3 program is in the -- we're looking at the STAT3 program the same way that we have evaluated the 413 program. I think there is a broad opportunity that we're evaluating, again, in oncology, and as we said in the past, outside of oncology. Having said that, we will always be continuing to evaluate at every stage of development, whether our thesis is playing out the way that we planned versus not. And so, for now, we have full confidence in what this program can do. And the data that we're sharing today and data that we haven't shared yet continue to support our thesis.

Okay. That's helpful. And maybe to Jared, a follow-up on MDM2. It's nice to see no trigger heme events. But could you discuss a bit more about the kinetics of the platelet changes you're seeing? Because for DL1, at least you've gotten up to six cycles. So, are you seeing a return to baseline for those accounts by the start of the subsequent dose? I'm just trying to get a sense for the potential of any compound impact over cycles on counts as you move to those more potent dose levels. Thank you.

Yes, Brad. I mean so far, within these first two dose levels, we have not seen any thrombocytopenia or neutropenia. So, we have not seen any reduction in platelets or neutrophils.

Thanks, so much.

[Operator Instructions]. Next question would be from Vikram Purohit of Morgan Stanley. Please go ahead.

Good morning, everyone. This is Gospel on for Vikram. So, we have one question. So, given the release mentions a focus for the company on immunology moving forward, do you plan to keep developing the STAT3 and MDM2 programs beyond the initial clinical data sets? Or could those programs be halted or partnered up? Thank you.

Okay. Great question. So just to be clear, I think we're seeing two important things today. One is that, as we have continued to say over the years, we want to make sure that we deploy our platform against clear unmet needs, and doing so by going after targets that have not been drugged or drugged well. We also said today, and we've said it over the years, that our focus is on large problems. So, problems that have not been solved by other technologies, and more importantly, in patient population that we believe are sizable. So, when we talk about immunology, we believe that, that is an area that is prime for this technology. We believe, as you'll hear much more in January, that oral degrader medicines in immunology could offer really amazing opportunities for lots of diseases that now are either underserved or served only by injectable biologics. Having said that, there are areas of oncology that still fulfill the investment thesis that I just outlined, meaning we believe that we have programs that can unlock larger opportunities by going after targets that have not been drugged or drugged well by other technologies. So, I think the main theme is going after, in this evolving landscape, sizable opportunities, and really deploying the technology where it's best deployable. It is fair that we believe that the opportunities in immunology are probably both broader. And actually, I would say also, with less competition than I think we see in a very, very competitive oncology space. And we will continue to evaluate whether the case continues to be as we continue to evolve this program. So, I think at this point, that's where we are. As we go into January, I think the pipeline choices and the prioritization will be even clearer.

The next question will be from Marc Frahm of TD Cowen. Please go ahead.

Marc, are you there?

We'll come back to Marc. Next up, we have Geoff Meacham, Bank of America. Please go ahead.

This is John Joy on for Geoff Meacham. I guess kind of looking at KT-474, what are your clinical benchmarks in atopic dermatitis? Like is the bar to beat still [indiscernible]?

Great question. So, what we're looking with our IRAK4 degrader, which is really a first-in-class medicine that is trying to -- just to go back a second. The goal there is to block the path to the IL-1R/TLR pathway with a single oral molecule. And in doing so, being able to elicit the biological and hopefully clinical impact that upstream biologics are not able to do, and basically demonstrate the clinical activity of potentially all the upstream biologics in a single molecule. Obviously, the IL-1R/TLR pathway is not the IRAK4/STAT3 pathway. So, we look at IRAK4 as a broad anti-inflammatory agent that can be both effective, well tolerated, and oral, and so convenient for a broad patient population. So, our bar right now, in the absence of conclusive Phase III data that will allow us to position the drug commercially in a credible manner, I think at this stage, what we said in the past and continue to say is the target product profile for 474 is to be an oral active drug with a good safety profile. And I would argue that, that is not present right now in either the HS or the AD market, and that's really the goal of that development program.

Okay. Awesome. And then one quick follow-up. So, is there any read-through or material impact to Kymera from Sanofi's increased R&D spend announcement?

I think it's a positive read through from where I stand, obviously. I can't comment on Sanofi's decision. I think for me, if I had to share my opinion, I think it's refreshing to see a large pharmaceutical company taking a bold move and investing in R&D. That's all I'm going to say.

Next question will be from Marc Frahm, TD Cowen. Please go ahead.

Can you hear me now?

Yes.

Okay. Sorry about that. Maybe for Jared, the description of the ASH abstract in there, there's nine nonevaluable patients, I believe. Can you describe those? How many are still on trial, and maybe along with that, the -- how many should we expect where single-agent activity might actually be part of the hypothesis when we get to the ASH presentation? And I do have a follow-up there.

Yes, Mark. Yes, we really can't comment on the sort of results beyond what is in the abstract. And as you noted, we've enrolled 21 patients so far to the first five dose levels. We noted that 12 patients were valuable across the first four dose levels, and we talked about the one PR and the CTCL patient at those level two, and three cell of tumor patients who are stable at those level three and level four. So, our plan in December at ASH is to, obviously, provide updates both on those patients, as well on any additional patients who have enrolled onto the trial between that abstract cutoff date and the cutoff date for the ASH poster.

Maybe if I won't get in trouble with ASH here, I just want to add maybe a couple of more things. So, one, I guess, the ones that were not evaluable. I would guess, I don't know the details, it's a mix of patients that progressed too early and patients that are still early in their dosing in the -- more recent cohorts. And I think it's fair to say that for the ASH abstract, we do expect sort of -- actually the ASH presentation, we do expect to see evaluation of more liquid tumor patients. We can't say how many, but we expect to see more than the first two on those level two.

Okay. That's helpful. And then as you laid out earlier in response to one of the other questions, the bigger hypothesis here really is combination for solid tumors. I guess, can you lay out what do you need to show in this trial in order to kind of trigger those combi -- opening up those combination cohorts?

Yes. Before we go there, I want to make sure -- I don't want to sound overly positive, but I also want to sound realistic. We have shown for the first time that STAT3 degradation can help patients. This has never been done before this way. And so, I think we need to just take a moment and appreciate that this is first-in-class data. And while we can debate, obviously, the size of the patient population that the single agent activity is pursuing, we should not forget that that's what we're here to do, we're helping patients with innovative first-in-class medicines. So, I'm not deflecting your question. So now going to your question, there are several things that we want to be able to see to move into an expansion cohort in a solid -- in solid tumors. First, understand the degradation safety and any signs of -- any activity that we see as a single agent in solid tumors. As you know, we don't expect to see single-agent activity. We have some stable diseases. They are actually have been, for quite a while, we can't -- it's hard for us to know how much of that is, the disease being slow progressive or how much of that is the actual degradation of STAT3. We'd like to think that it's probably a bit of both. But -- so there is an aspect of that. There is an aspect of, as I mentioned earlier, looking at tumor biopsies and understand if we can replicate what has been shown actually, both preclinical in the clinic with other agents, including STAT3-dep in terms of modulating the tumor microenvironment. And then as I mentioned, we have ongoing activities preclinically, not only actually exploring the STAT3 PD-1 combo, but also STAT3 and other targeted therapies combos. And I think where we stand today, we have optimism that this mechanism is a place in drug development in oncology. It's just for us too early to say what that is until we complete all these series of studies, as I said, both clinical and preclinical.

Next question would be from Eliana Merle, UBS. Please go ahead.

This is Jasmine on for Eli. Thanks for taking my question. On STAT3, how are you thinking about kind of the dose response and the optimal levels of degradation? Do you think that the optimal dose could be different in solid tumors versus the hematological phase? And then I have a follow-up on 333.

Jared, do you want to take that one?

Yes, it certainly is possible that there could be different recommended Phase II doses for solid tumors lymphomas, which is the Arm A of the Phase Ia versus high-grade myeloid malignancies, including AML, which is Arm B. We think, ultimately, activity is going to be probably a function of MDM2 degradation and the level of p53 pathway activation that we're able to elicit either in solid tumors lymphomas or in AML, along with the sensitivity of those tumor types to p53 mediated apoptosis. Also, of course, it's going to be the safety profile of the drug, which may be the same in liquid and solid tumors or could be different. So, these are all the things that we'll be investigating in these two Arms on study. Looking at safety, looking at the degree of p53 pathway, engagement and activation that we're able to elicit with the drug, and of course, then looking at clinical activity. And that will determine what will be either the maximum tolerated dose or the recommended Phase II dose that we bring into the next phase of development, which will be Phase Ib. And again, as you sort of noted, it's possible that it may be made up having the same dose used across all those indications or there could be different doses across solid tumor lymphomas versus liquid tumors. But the study is designed to allow us to assess that and make the determination by the end of Phase Ia.

And just to add, I know we have got other questions, but I just want to highlight, just as I did for 333. I mean the CTCL for 253 was and continues to be with a degrader mechanism. You can drive tumor cells to a quick apoptotic response and have infrequent dosing regimen that maximizes efficacy and safety. And while we have limited data, and I will say that again, limited data, it was extremely exciting for us to see that the thesis is playing out in the way that we imagine or probably even better at this point. So, I would encourage everybody to keep an eye on this program because if the profile continues to evolve this way, I think we'll have a really large opportunity set in evolving patient certification thesis that we'll share more of next year.

Awesome. And then just quickly on 333. Those three stable diseases that you saw in solid tumor patients, can you give any color on what tumor types those were?

We actually saw the stable disease across a variety of different solid tumor types. And as Nello mentioned, we have some patients who have had fairly prolonged stable disease as well. I think we'll be able to provide, I think, more color on the actual solid tumor types at the actual ASH presentation in December. But I think it's very encouraging that on the study, we've been able to enroll a variety of different solid tumor types as well as a variety of different T-cell malignancy types, including PTCL, CTCL, and others as well. So, I think we'll look forward to providing more of those details and updates in December at the ASH presentation.

Next question will be from Eric Joseph, JPMorgan. Please go ahead.

Hi, good morning. Just might be asking you to step a little bit into the January R&D Day, but can you talk about how your experience with KT-333 so far informs the attractiveness of STAT3 within your oral immunology pipeline planning relative to other targets of interest? And does your experience with 333 perhaps give you a head start on an oral degrader versus some of the other targets? Does it inform -- yes, I guess total what are the lessons so far from the IV formulation that can carry over to oral? Thank you.

Yes, Eric. Great question. So not to not answer your question, but I would point to two things. First, I think what we learned the most about oral degraders in immunology is from the KT-474 program. As you know, we took a bold approach a few years ago to take targeted protein degradation in immunology. And I think we've been rewarded by that approach. We've shown how a oral degrader can be safe, can be well tolerated, can be effective at degrading the protein, can have a really substantial anti-inflammatory effect as measured by cytokine inhibition, and also has shown early signs of clinical activity. As you know, we've been careful with overweighing on the clinical activity because of the small lands. But I think it's clear to say that if you look at the totality of the data, there was clearly benefiting patients. And besides what's publicly available, there is a lot that we've learned on drug development of degraders in immunology, going back to preclinical, to talks, to CMC, to clinical trial strategies. So, I think that has inspired us and has driven us to take that concept in equally large clinical opportunities. I think what we -- and so you will see in January, that the programs and the data that we are generating are impressive. And maybe I'll leave it at that. With regards to 333, I think what we've learned for sure is that this is an extremely powerful mechanism. And it seems to be -- it seems to have, at least so far in oncology patients, a good safety profile as of the data we've disclosed so far. And so that has probably told us that there are pathways of particular targets that will be or can be amenable to this approach even if the safety of that particular pathway or the particular target had not been previously derisked either in the clinics or through human genetics. So maybe that, hopefully, will give you an idea of what we will be talking about in January.

And just a reminder, we do not have enough time to get through the remainder of the Q. We'd like to ask that you limit it to one question.

Maybe I'll try to be faster in the answers.

Next question, operator.

Next from Michael Schmidt of Guggenheim. Please go ahead.

Hi, good morning. This is Paul on for Michael. Thanks for taking my question. Mine's on KT-253. I just wondered if you could provide some color on the Merkel cell carcinoma patient who had a PR. Do the patient have MDM2 application or any biomarkers like CDK and 2a [ph] loss that might be related to the response? And were you able to achieve your target degradation level in this patient? And just trying to understand the activity here at level one. Thank you.

Yes. This Merkel cell patient was p53 wild type and had the Merkel polyomavirus, the majority of Merkel cell carcinoma patients have that virus in our p53 wild type. That patient had previously been treated both with chemotherapy, and in the past, with anti-PD-1 drugs, which have been shown to be effective in Merkel cell. The patient had responded initially to anti-PD-1 and then had progressed after their latest anti-PD-1 before coming on to our study. I think on the study trial on dose level one, that patient did have a very robust induction of GDF15, which as we mentioned, is the downstream biomarker of MDM2 degradation. And so that particular patient who had that has an ongoing partial response, did show clear on-target pharmacology with elevation of GDF15. And so, we've been very encouraged that even at the very first dose level, we're seeing this sort of response, a partial response in this type of solid tumor that had previously progressed after anti-PD-1. And that really sort of does so far support our mechanistic and therapeutic hypothesis about being able to affect these p53 wild-type tumors with p53 activation and pathway upregulation, with a safety profile where we're not seeing any hematologic toxicity, which was the case for this patient as well.

Next question will be from Srikripa Devarakonda of Truist Securities. Please go ahead.

Hi, guys. Thank you for taking my question. I was at the TBD conference. And one takeaway seems to be that -- or one comment, I would say, was degrader does appear to be held at a higher standard for safety than historically small molecules have been. Do you think there is now a standard established in how you evaluate safety in the field? Do you think it is case by case for each drug? And just broadly, do you expect things to continue to evolve until we see early approvals in this space?

No, great question. So, I don't know. I think maybe, your comment reflects the fact that this is a new generation of medicines. And while I think it's not really broadly appreciated that this is a new generation of medicines probably, because probably the mechanism is not fully well understood by distract observers. This is a new generation of medicines. And so, with that, obviously, you always come to the questions of the interplay between safety and efficacy. So, I think that's probably what's driving some of the questions. Personally, I think it's been shown now extensively by approved drugs. There are degraders, and we've talked about the image that have been on the market for years, for decades. And then all the investigational drugs that have been in the clinic for years now from companies in the space, that any safety to do with a degraded program is tied specifically to their on-target and off-target safety profile. And there is no safety that we, at Kymera, have seen that had to do with the actual technology. So obviously, if you have a well-tolerated mechanism, and you don't have off-target activities, I think you see molecules be well tolerated. And I think that has been consistent across the industry. Now, this is an extremely powerful technology, and this is why we believe has huge potential. And so, specificity of our molecules has to be paramount. And I think that's what I encourage, obviously, everybody to be focused on.

Next question will be from Derek Archila of Wells Fargo. Please go ahead.

Thanks for taking my question. Just one. So just given the future focus on sizable I&I indications, I guess. How does that change the calculus on cash runway? And I guess, is it fair to assume that you'll run more traditional Phase II studies to achieve proof of concept for those programs? Thanks.

Yes. So maybe I'll answer the question. Bruce, if you want to add anything to it. So, I think it's noted that through being more financially responsible, as we've said today, we've extended the runway from the second half of '25 to now the first half of '26. And that includes all the plans that we have for our expanding immunology pipeline. I just want to be sure that's clear. We will develop those drugs with the goal to approve to launch registrational studies as quickly as possible, while continuing to validate that our, obviously, investment thesis is playing out also in early development. So, I think it would be a mix of validation that is needed, right, to continue to do large investments, but also an eye on path to approval in these large indications. And as you know, with the evolving landscape, it's important, it's extremely important

The next question will be from Chris Shibutani of Goldman Sachs. Please go ahead.

Thank you. Many of the questions have been asked. But again, with regard to the immunology strategy imbrues, are you thinking about ultimately collaborating or partnering some of the more advanced clinical development? And part of the protein degradation was brought up quite prominently in a recent R&D presentation from a large type pharma in Bristol. And as we think about new medicines, cell therapies moving into immunology as well, if you had to guess kind of where the puck may go, and what might be unique about targeted protein degradation that will ultimately differentiate, what might that be?

I think, Chris, it's a simple -- actually, it's a very simple answer to this one. And I don't want to give away too much of the January message. But I would say, I would look through this land. So, we've learned a lot about immunology in the past 15 years, I would say. There have been pathways that have been validated mostly through targeted biologics. We've learned the role of TNF, we've learned the role of IL-17, IL-23, IL-4, IL-13 [ph]. And we've been able to do so using these injectable biologics that give us high specificity, in many cases, excellent efficacy, but maybe suboptimal convenience, as well as high cost of goods. We believe that degrader can actually bring biologics-like type of specificity, strong efficacy and the convenience of a small molecule, oral small molecule, which traditional small molecule cannot do because they lack the ability to have this complete pathway inhibition. And so, the place for oral I&I degraders will be solving the problem of oral convenient small molecule, well-tolerated drugs that have really strong efficacy. That's really the place where we want to be. And I don't believe that there is a technology that can effectively compete with that, assuming we will fulfill the target product profile that we want.

Next question will be from Kalpit R. Patel of B. Riley. Please go ahead.

Yes. Good morning. Regarding the STAT3 degradation levels. As you see relatively higher STAT3 degradation for the one responder in DL2, and the three patients with stable disease relative to the other patients in those cohorts, were those patients closer to that 80% or 90% degradation level that you're aiming for?

We've actually seen robust STAT3 degradation in the blood, really across many of the dose levels that we've tested, including dose level two, dose level three dose level four. The numbers are still small, probably too small to make correlations between degradation and response. But so far, I think it's fair to say that we've seen robust degradation in most of our patients at those levels. And we're not necessarily seeing a correlation or connection between degradation and response.

Next question will be from Kelly Shi of Jefferies. Please go ahead.

Hi, good morning. This is [indiscernible] on for Kelly. And this is actually a very follow-up question to the comments that you just made. And so, I believe you said that you saw clinical activity at those levels. You didn't expect to see such activities, but I understand that patient numbers is still limited early. But is there a possible that there could be a disconnect between target protein degradation and the clinical activity? And do you expect that patent to potentially change when you start to look at combination therapy, and any implication for the immunology indications? Thank you.

So just to be clear, I mean, we're seeing those response in degradation across the STAT3 cohorts, and we're seeing those responsive pathway engagement/degradation in the MDM2 program. I think it's important to note that we are degrading at 80% plus in some patients already in the early cohorts for STAT3. And as well as in the MDM2 program, we already have robust pathway engagement. And so, what we're seeing here is that there are particular patients or subset of patients that might be so sensitive to this mechanism, where a full degradation may not be required. But we have confidence that as we increase the dose and the engagement profile, then the patient population that will respond will be larger than what we've seen in the early doses, as you'd expect, for a technology that has really, really strong control of target engagement. So, I think, these are just driven by the small ends and the few patients on study, and the strong degradation we see already with the early doses.

Okay. We'd like to thank everyone for joining us this morning, and we look forward to keeping you updated on our progress. In the meantime, for a list of upcoming conferences that we will be attending, please visit the Events page in our Investors section of our website. Additionally, details around our upcoming R&D Day will be released in December. And in the meantime, please don't hesitate to reach out if there are additional questions. And this concludes today's call.