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Greetings and welcome to Rigel Pharmaceutical's Financial Conference Call for the Third Quarter 2024. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce our first speaker, Ray Furey, Rigel's Executive Vice President, General Counsel, and Corporate Secretary. Thank you, Mr. Furey. You may begin.

Welcome to our third quarter 2024 financial results and business update conference call. The financial press release for the third quarter 2024 was issued a short while ago and can be viewed along with the slides for this presentation in the news and events section of our investor relations site on Rigel.com. As a reminder, during today's call, we may make forward-looking statements regarding our financial outlook and our plans and timing for regulatory and product development. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found in our most recent annual report on form 10-K for the year ended December 31st, 2023, and subsequent filings with the SEC including our Q3 quarterly report on form 10-Q on filed with the SEC. Any forward-looking statements are made only as of today's date and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances. At this time, I'd like to turn the call over to our President and Chief Executive Officer, Raul Rodriguez. Raul.

Thank you, Ray, and thank you, everyone, for joining today. Also with me today are Dave Santos, our Chief Commercial Officer; Lisa Rojkjaer, our Chief Medical Officer; and Dean Schorno, our Chief Financial Officer. I'll begin on Slide 4 with an overview of Rigel's business and our third quarter results. In the first three quarters of the year, we made significant progress in our strategy to grow our hematology and oncology business. Our corporate strategy is focused on three main objectives; one, expanding our commercial portfolio and increasing product sales. Two, advancing and growing our pipeline through strategic collaborations and importantly, internal pipeline development and three, maintaining financial discipline. I will now summarize each of these. Firstly, in the third quarter we generated strong growth across our commercial portfolio with a total net sales of 38.9 million. This was up 44% compared to the third quarter of 2023. This robust revenue growth was driven by the addition of GAVRETO, which generated 7.1 million in net product sales for the first – for its full third quarter – first full quarter with Rigel, as we transitioned the majority of patients and prescribers into our network. In addition, we saw continued year-over-year growth for TAVALISSE and RE

Thank you, Raul. We are very pleased with the strong growth in revenues in Q3. Moving to Slide 6. You see how our quarterly and annual sales have evolved since 2021. We have grown each quarter's sales over the previous year, and that growth continues particularly from last year to this year. We started the first quarter of 2023 with $23.8 million, and are now reporting $38.9 million in the third quarter of 2024. That's an incremental 15.1 million, representing 63% growth in quarterly revenue over seven quarters. That growth has been driven by our strong commercial execution, in consistently building quarterly demand for TAVALISSE and driving broader awareness of RE

Thanks Dave. Moving to slide 19. I'd like to begin by highlighting a series of abstracts that will be presented at posters at the upcoming ASH annual meeting in December. As Raul mentioned initial data from the dose escalation part of our phase 1b study of R 289 and patients with relapsed or refractory lower risk M DS will be presented during the poster session on Monday December 9th. Updated results using a data cutoff date of October 25th will be shared at the meeting. Additionally, a number of presentations related to olutasidenib in patients with IDH1 mutated AML and MDS are planned. Moving to slide 20, we continue to execute on our strategy to expand our hematology and oncology pipeline. First, we're making meaningful progress advancing olutasidenib into new clinical indications alongside our partners MD Anderson and the Connect Cancer Consortium. We believe olutasidenib has potential in several cancers where mutated IDH1 plays a role such as additional AML segments myelodysplastic syndrome or MDS and glioma either as monotherapy or in combination. One clinical trial is now active under MD Anderson collaboration. And we're continuing to advance a lucid and glioma with connect R289 is our novel dual IRAK1-4 inhibitor that is currently being evaluated in a phase one B study in patients with relapse refractory lower risk MDS. Enrollment in the fifth dose level is ongoing. We expect that the DLT observation period will be completed within December. We also remain focused on evaluating potential opportunities to in license or acquire products that would be a strategic fit for our portfolio. We're looking for differentiated products in hematology, oncology or related areas. Products that are late stage possibly with registrational data soon to have registrational data or more advanced and products that can leverage our hematology and oncology infrastructure. As demonstrated with our acquisitions of Olutasidenib and Pralsetinib, our goal is to continue to find assets that align with our organization pipeline and ability to execute. Slide 21 provides an overview of our strategic alliance with the MD Anderson Cancer Center to advance to olutasidenib more broadly into AML MDS and beyond. We're very proud of this collaboration and have previously shared that in September, the first patient was dosed or was enrolled in a phase 1b2 triplet therapy trial in IDH1 mutated AML evaluating olutasidenib, decitabine and venetoclax.. It is also planned to evaluate olutasidenib as a monotherapy in patients with IDH mutated CCUS and lower risk MDS. The combination with an HMA and high-risk MDS, Anderson monotherapy as a post transplant maintenance therapy for patients with IDH1 mutated hemologic malignancies. We expect these trials to position us to conduct a subsequent registrational trial or trials. Moving to slide 22. Another important development collaboration we have is with the Connect Global Neuro Oncology Consortium to conduct a phase 2 trial in patients with IDH1 mutated high grade glioma. Gliomas account for around 30% of CMS tumors in children adolescents and young adults. Approximately a third of these are high grade glioma translating to approximately 800 to 1000 new cases each year in the US. High grade gliomas are a leading cause of cancer related death in adolescents and young adults. Despite available therapies the five year survival of this population is less than 10%. Based on preliminary safety and efficacy results from a phase 1B2 clinical trial evaluating olutasidenib heavily pretreated patients with relapsed or refractory IDH1 mutated glioma, we believe that olutasidenib has potential in glioma treatment. A phase two study of olutasidenib in combination with temozolomide called Target D will be included as a treatment arm and connects target study, a molecularly guided phase two umbrella clinical trial for high grade glioma. The goal of this study is to determine whether the combination of olutasidenib and temozolomide followed by olutasidenib monotherapy can prolong the progression free survival of patients with IDH1 mutated high grade glioma when given following radiotherapy. We, along with CONNECT are excited about olutasidenib's potential to provide a much needed new treatment option to this underserved patient population. We anticipate this trial will be activated by the end of this year. Next, I'd like to provide some background information on our clinical development program and lower risk MDS with our novel dual IRAK1-4 inhibitor R289 which you will see on slide 23. Lower risk M DS is an area of high unmet need in a primarily elderly patient population facing progressive cytopenias, particularly anemia resulting in transfusion dependency and increased risk of infections and a risk of progression to acute leukemia. Transfusion burden is high with more than 80% of patients requiring red cell transfusions as supportive therapy. Long term survival rates are poor due to transfusion burden and its associated morbidities, as well as a lack of curative therapies other than allogeneic stem cell transplantation which a minority of patients are eligible for due to their advanced age and underlying health conditions. The primary goal of therapy is to reduce transfusion burden. Initial treatment options include ESAS if eligible and lenalidomide for del(5q) patients. For transfusion dependent patients, [indiscernible] have recently been approved post ESAS or for ESA and eligible patients in later lines of therapy durable responses are difficult to attain and toxicity becomes more of an issue. There are no standard therapies for lower risk MDS patients with recurrent or refractory disease. In fact typo methylating agents were approved about 20 years ago, underscoring the need for new safe effective therapies for these patients. We believe that R289 has the potential to address the unmet needs in this patient population by targeting inflammatory signaling. Moving to slide 24. I'd like to highlight why we're excited about our 289, dysregulation of the immune and inflammatory signaling pathways is associated with MDS with chronic stimulation of both the toll-like and IL-1 receptor pathways involving IRAK1 and IRAK4, leading to a pro-inflammatory marrow environment and cytopenias. IRAK1 and 4 activation independent of this pathway may also lead to persistent inhibition of hematopoietic cell differentiation. Co-targeting both IRAK1 and 4 may fully suppress inflammation and restore hematopoiesis in MDS. Clinically, IRAK4 inhibitors in MDS and AML have thus far only shown modest activity supporting this concept. In preclinical and healthy volunteer studies, R835, a dual IRAK1/4 inhibitor was previously shown to suppress pro-inflammatory cytokine production. R289 is an oral pro-drug that is rapidly converted to R835 in the gut that is now being evaluated in lower-risk MDS. Slide 25 shows the design of our ongoing open-label Phase 1b study of R289 in patients with relapsed refractory lower-risk MDS, which has a dose escalation phase with a standard 3 plus 3 design and a dose expansion cohort for confirmatory safety. The primary endpoints for this trial are safety and selection of the recommended dose for expansion, and secondary endpoints include hemologic improvement response rates and PK. Based on emerging data from the study, we've recently included two additional cohorts with twice-daily dosing regimens for a total of five dose levels. The study continues to progress well, and enrollment in the fifth dose level, split dose of 500 milligrams and 250 milligrams daily is nearing completion. We expect the DLT evaluation period of this dose level will be completed in December. We're encouraged by the preliminary safety and efficacy data from the study thus far in this elderly patient population with a high transfusion burden as summarized in the recently published ASH abstract. Lastly on slide 26. Our RIPK1 inhibitor programs are progressing well with our partner Lilly. RIPK1 is implicated in a broad range of inflammatory cellular processes and plays a key role in tumor necrosis factor signaling. Ocadusertib, our non-CNS penetrant RIPK1 inhibitor, previously referred to as R552 is currently being studied in an adaptive Phase 2a/2b clinical trial in up to 380 patients with active moderate to severe rheumatoid arthritis. Phase 2a enrollment of approximately 100 patients is advancing well with preliminary analysis of the Phase 2a results anticipated within the first half of 2025. Our preclinical CNS penetrant RIPK1 inhibitor program is also progressing toward lead candidate nomination. We're excited about the progress of our programs and their broad potential in rheumatoid arthritis and other immune and CNS diseases. Now, I'll pass the call to Dean to discuss our financial results for the quarter.

Thank you, Lisa. I'm on slide number 28. During the third quarter, we shipped 2,793 bottles of TAVALISSE to our specialty distributors. 2,797 bottles of TAVALISSE were shipped to patients and clinics, while four bottles decrease the levels remaining in our distribution channels at the end of the quarter. We shipped 429 bottles of RE

Thank you, Dean. And moving on to slide 30, please, this is really an exciting time for Rigel. During the first three quarters of 2024, we delivered on our goals that we set earlier in the year. First, we generated strong growth in our commercial business. We've achieved another record demand quarter for TAVALISSE and RE

Thank you. [Operator Instructions] Our first question comes from the line of Joe Pantginis with H.C. Wainwright. Please proceed with your question.

Hey, everybody. Good afternoon. Thanks for taking the questions. Nice to see the approved products progress. So, two questions if you don't mind. So first, I was hoping to see if you can provide any more color with regard to Tavalisse and the balance or mix between refills and new prescriptions.

Would you provide some commentary on that?

Sure. Thanks for the question, Joe. As you know, Tavalisse is a product that patients take and will continue taking as long as their platelets are controlled and are elevated and you know sometimes that takes a while. So I will say that the majority of our business is carry over. Once we have patients on board, they will tend to stay on therapy and that is the majority of our business. And because we've grown new patient starts, over the last couple of years, I think we're seeing that growth and carryover go along with that. So that's what I meant to say or that's what I was referring to when I said both our growth is both from new patients starting as well as carryover but the majority is carryover.

Got it. Appreciate that clarification and color. And then the second question that, I have I want to make sure if I heard correctly. So, nice to see the early traction with GAVRETO. And if I heard you correctly, you said that several top centers have not -- have still not placed orders. I was just curious is this really just based on logistics or how would you characterize it?

First of all what I said in my prepared comments just to be clear, as I said there's a handful of top centers that we haven't seen direct orders from. And so, you know we had expected to see that and we haven't. So we're trying to understand that a little bit. But the good thing about our data is we have a significant portion through the specialty pharmacy network. So what we could be seeing is patients are in the specialty pharmacy network when they transition to the to the RTO network versus the institution buying the drug and then filling it there. But overall, actually what I said in my prepared marks was that 45% of our business was through the distribution channel to direct accounts in Q3. When we just looked at this for October it's up to 50-50. So I think this is improving and we -- it is more like what we expected more of our business coming through the direct channel. Hope that helps Joe.

It certainly does. Thanks for the color.

Thank you, Joe.

Thank you. Our next question comes from the line of Yigal Nochomovitz with Citi. Please proceed with your question.

Hi team. This is Ashiq on Yigal. Thanks for taking my question and I appreciate all the updates here. I just had a follow-up on the last question on the GAVRETO for relaunch. How much of a stocking benefit was there the sort of initial phase of the -- of the launch at least with you guys. And on the sort of reported sales, seven million looks like it's at least on a similar run rate for the quarter compared to what the prior entity did with it last year. So how should we think about the growth trajectory from here? We should be thinking about it in a more aggressive way or maybe more modestly from here given the given the sort of restart that. Thanks.

Dave, you want to take that?

Sure. Thanks for the question. First of all, remember that at the end of Q2, right at the very end, we filled some orders to our distributors and that was what I would refer to as stocking. It was about $1.9 million in sales. This quarter we sold 717 bottles or we shipped 717 bottles, and we had just a slight more 750-odd bottles sold. So there were another maybe 30-some bottles built up in the channel. So I would just say that the majority is demand that we saw in -- the overwhelming majority of what we saw in Q3 is true demand, patient demand, account demand. And what I will say is that, obviously, we started the quarter with some level of shipments going out to patients and clinics. We ended the quarter with a much higher level of shipments going out to patients and clinics as more people transitioned over. So I can't really comment any more than that, but we would expect to see some continued demand growth as we move forward.

And translated specifically into bottle counts. We had 228 bottles of increase in our distribution channel or inventory that Dave described in Q2, and that was essentially the full amount of revenue. And then we had an incremental build of that inventory of 35 bottles. The remainder of the bottles in Q3 were from shipments to patients and clinics.

Understood. Thank you very much.

Thank you.

Yes. Thanks for the question. I think that that will be shared in more detail in December.

Thank you, Kalpit.

I'll let Lisa comment. Let me just preface this by saying that we're really excited about this data. This data -- this molecule was a molecule discovered here at Rigel. We own full rights to it. We think definitely the most advanced IRAK1 and 4 inhibitor that there is available. We are excited to study it here in low-risk MDS, where we see a very good mechanism to indication. And we're really interested to try here, and we're delighted to present the data that you saw in the abstract and substantially much more detail in the poster to come. In terms of the bar, Lisa, maybe do you want to comment on that?

Lisa, do you want to comment on that?

I would say that from yeah -- and then maybe Dave can comment. So from the clinical perspective this really isn't a something new. You know looking at the AERO study we were aware that infections were reported. This is in the label already. In the safety section, we know that mechanistically there's a rationale for why this is happening. We know that in addition to RT inhibition that these increased risk of infections may stem from the off target inhibition of JAK1 and JAK2, which are not the primary you know targets but nonetheless there is some off target activity there. And we know also in terms -- most of the infections were pneumonias which are very common in this patient population. About 80% of patients get pneumonia with lung cancer and receiving treatment for lung cancer. So this is a situation that oncologists are very familiar with managing.

If you want to comment on what you've heard from Simpson [ph].

Thank you. Our next question again comes from Kalpit Patel from B. Riley Securities. Please proceed with your question.

Yeah. Thanks for taking the follow-up. I just had one more on the lower MDF program. There was another agent Curis' IRAK inhibitor that was started in an investigator sponsored study but then later withdrawn for the same indication. So I guess if you had to highlight a few differentiated factors with R289 versus the others what would they be?

It's hard to comment on other people's. I would say ours is an IRAK1 and 4 inhibitor. I believe theirs was an IRAK4 inhibitor. That is a significant difference. I think Lisa highlighted in one of the slides where we showed that inhibiting both 1 and 4 provides a more profound inhibition of inflammatory cytokines presumably in the bone marrow in this case. So that is an important difference between those two. And as I said earlier I don't believe there's another IRAK1 and 4 inhibitor in development and certainly not in more advanced development available. So, we this is the first to work on a 14 and that rationale the more profound cytokine inhibition was one of the reasons we liked 1 and 4 over 4. And Lisa any other comments?

No, I think that pretty well summarizes it.

Okay. Wonderful. Thank you again.

Thank you Kalpit.

Thank you. There are no further questions at this time. I would like to turn the floor back over to Mr. Raul Rodriguez for closing comments.

Thank you and thank you everyone for joining on the call today and your continued interest in Rigel. I can't say it's a very exciting time for the company having data to share an exciting product and more coming I think is really a great place to be. The year has gone very well for us in terms of commercial growth in addition to the portfolio and advancements in our development. And we look forward to telling you more about that in the in the 2025. So, with that I'd like to also just always thank our employees for their continued commitment to our cause and improving the lives of patients and look forward to updating you further in other calls. Take care.