Jim DeNike - Senior Director of Corporate Communications Scott Cormack - President & Chief Executive Officer John Bencich - Vice President and Chief Financial Officer Cindy Jacobs - Executive Vice President and Chief Medical Officer Jaime Welch - Vice President, Marketing & Corporate Communications.

Katherine Xu - William Blair & Company Danielle Brill - Needham & Company.

Good day, ladies and gentlemen, and welcome to the OncoGenex First Quarter 2016 Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to Jim DeNike, Senior Director, Corporate Communications. Please begin..

Thanks, Latoya, and thanks, everyone, for joining us. With me today from OncoGenex are Scott Cormack, President and Chief Executive Officer; John Bencich, Chief Financial Officer; and Dr. Cindy Jacobs, Chief Medical Officer. Jaime Welch, our Vice President of Marketing and Corporate Communications will also be available for the Q&A.

Before we begin, I’d like to remind everyone that today’s conference call contains forward-looking statements based on current expectations. These statements are only predictions, and actual results may vary materially from those projected.

Please refer to OncoGenex’s documents filed with the SEC concerning factors that could affect the company, copies of which are available on the website. I’ll now turn the call over to Scott..

Thanks, Jim. On today’s call, we will provide an update on our clinical development programs with near-term milestones that we believe have the potential to create significant value for the company over the next 12 months.

Since Custirsen and Apatorsen are advancing toward commercialization, we wanted to review our perspectives on the evolving prostate, lung and bladder markets and the potential opportunities for our product candidates to fulfill the need for new treatments in these diseases.

Following our program update, John will provide an overview of our strong financial position that will carry us through upcoming milestones without the need for additional funding. Let me start with our most advanced clinical asset, Custirsen.

Custirsen is currently being evaluated in two phase 3 clinical trials, one for prostate cancer and the other for lung cancer. This compound is highly specific inhibitor of the protein clusterin that is designed to improve survival in patients with advanced cancer by disabling the fundamental cellular repair mechanism used by tumor cells.

We have two randomized phase 3 trials expected to read out over the next year or so. The first is our AFFINITY trial. AFFINITY is a phase 3 clinical trial evaluating the survival benefit for Custirsen in combination with cabazitaxel as second-line chemotherapy in approximately 630 men with castrate-resistant prostate cancer.

In December 2015, an independent data monitoring committee recommended continuing the trial as planned based on the interim analysis. Both the independent data monitoring committee and OncoGenex remain blinded to all interim analysis data.

Depending on timing of the events, final results for the overall study population are expected in the third quarter of this year. As we look at the role for Custirsen in the treatment of advanced prostate cancer, it is important to note that the five-year survival rate for men with advanced prostate cancer in the US remains at only 28%.

While there have been numerous new therapies approved in recent years, the critical issue remains that most of the time prostate cancer treatment eventually fail and therefore new options are needed for men with advance disease. Despite this need, there is limited clinical research of new therapies being conducted in late-stage prostate cancer.

In fact, Custirsen is the only product currently in a phase 3 clinical trial for men following initial chemotherapy failure. We believe there is a unique opportunity for Custirsen in the treatment of prostate cancer. There are three distinct patient populations that we have the potential to address.

The first and most immediate opportunity for Custirsen is based on our near-term phase 3 AFFINITY trial read out, the use of Custirsen plus cabazitaxel to extend the lives of men with metastatic prostate cancer who are experiencing disease progression following initial chemotherapy.

The second potential opportunity is for the use of Custirsen in an earlier setting of prostate cancer, depending on the results from Sanofi’s ongoing FIRSTANA trial comparing cabazitaxel to docetaxel as first-line chemotherapy.

And finally, another potential opportunity is to evaluate Custirsen in combination with chemotherapy and androgen deprivation in men with high volume and high risk disease based on practice-changing results from the completed [Charted] and Sanofi trials.

For these last two opportunities, we would need to conduct additional clinical trials to expand our initial label, assuming of course success in the AFFINITY trial. Overall, the number of prostate cancer patients eligible for treatment continues to expand as a result of available new therapies.

Increased options have led to more men receiving treatment and having a longer progression-free time period. However, when the disease progresses and current treatment fail, these men need alternatives. We remain steadfast in our commitment to addressing that need with Custirsen.

Our second phase 3 clinical trial, ENSPIRIT, is an ongoing pivotal study which is evaluating the survival benefit for Custirsen in combination with docetaxel treatment as second-line chemotherapy in patients with non-small cell lung cancer.

A final interim futility analysis with more rigorous criteria for continuing the trial was successfully completed in July 2015 and the trial is continuing as planned. Based on current ENSPIRIT enrollment projections, we believe final survival results could be available in the first half of next year.

In the major markets, there are over 500,000 cases of lung cancer diagnosed annually with more than half of these in stage three or four disease. Similar to the prostate cancer market, use of new treatments in earlier lines of therapy will lead to more patients being treated and experiencing disease progression.

Despite the large number of lung cancer targets and treatments in development, chemotherapy will remain a fundamental treatment option for non-small cell lung cancer regardless of histology. This is because some patients do not respond to new therapies and even if they do, their disease unfortunately will likely progress.

We believe that Custirsen can play an important role in improving the current survival benefit offered by chemotherapy alone in patients who have received previous treatments.

Similar to prostate cancer, a majority of development efforts are focused in early disease states, leaving these late-stage patients and their healthcare teams with few options.

Market approval of Custirsen for either the prostate cancer or lung cancer indication could make a meaningful difference in the lives of patients and provide a significant revenue opportunity for OncoGenex. Together, particularly given the overall size of lung cancer market, both indications would be substantial.

As these market trends continue to call for more treatment options in the prostate and lung cancer settings, we look forward to the upcoming Custirsen data in both our pivotal phase 3 trials.

Turning to our other asset, Apatorsen, this compound is designed to target Hsp27, a protein that has been associated with tumor progression and treatment resistance. Apatorsen is the subject to four ongoing clinical trials, including bladder and lung cancer in combination with various therapies.

Results reported from recently completed studies evaluating Apatorsen in pancreatic and lung cancer patients demonstrated that for each trial a potential benefit was observed in a subgroup of patients with high baseline serum Hsp27 status when treated with Apatorsen in combination with chemotherapy.

In both studies, higher baseline Hsp27 was correlated with [more] survival, which is consistent with results observed in bladder cancer patients. In addition to the data in lung and pancreatic cancer, we also have data in hand from two completed studies in metastatic and non-muscle invasive bladder cancer.

These data include results presented at ASCO 2015 from the phase 2 Borealis-1 trial, indicating that the addition of 600 milligrams of Apatorsen to standard of care chemotherapy showed a 14% reduction in risk of death when compared to chemotherapy alone.

In the exploratory analysis of the Borealis-1 trial, greater survival benefit was observed in metastatic bladder cancer patients with poor prognostic features. These patients had a 28% reduction in risk of death with the addition of 600 milligrams of Apatorsen to first-line chemotherapy compared to chemotherapy alone.

Given our focus in bladder cancer, we want to review non-muscle invasive disease and the need for new therapies. This cancer is characterized by frequent recurrence and low risk of mortality with five-year survival of approximately 90%.

However, approximately 50% to 70% of non-muscle invasive tumors recur and patients can experience recurrence multiple times or progress to other muscle invasive or directly to metastatic disease. By 2020, bladder cancer is expected to account for more than 3% of all cancer-related medical payments in the US.

The average medical costs associated with diagnosis of muscle invasive bladder cancer specifically are estimated by some to be approximately $150,000 and the combined medical payments for non-muscle invasive disease are believed to be even more substantial than expenses associated with more advanced disease due to its prolonged nature, its prevalence and its requirement for frequent monitoring.

As a result, therapies that can prevent recurrence and to delay progression are urgently needed. When you factor in the additional non-medical costs associated with bladder cancer, such as lost productivity during recovery, the costs increase even more significantly.

These costs, unlike those for procedures and treatments, are often the direct responsibility of the patient, creating an additional burden not only on patients, but also their families and employers. We estimate there are approximately 90,000 treatable non-muscle invasive bladder cancer patients in the US and twice as many in the major EU market.

Treatment of this disease continues to be an area of high unmet need with limited treatment options or recent advances. The majority of patients with bladder cancer are initially diagnosed with non-muscle invasive disease.

When treated in a stage of bladder cancer, there is a sense of urgency to prevent disease progression to more lethal metastatic cancer, while also managing patient concerns for bladder preservation. As a result, there is a need and strong desire among patients, physicians and payers for more effective and cost efficient treatment options.

Given this need, let me take a few minutes to review our non-muscle invasive bladder cancer data to date and the steps we are currently taking to act on this and other bladder cancer data currently in hand.

Data was presented from a phase 1 trial evaluating patients with non-muscle invasive bladder cancer, in which 33% of the patients treated had no pathological evidence of disease following only four doses of Apatorsen given by intravesical administration over an 8-day period.

This data is informing our approach for future clinical trials in this disease. We have completed a pre-IND meeting with the FDA regarding our initial plans for intravesical administration of Apatorsen in the non-muscle invasive setting and are now preparing IND submission materials.

We are currently designing a pivotal study that will include a safety lead-in in randomized cohorts that will permit discontinuation if thresholds are not met in three patients of the populations with distinct non-muscle invasive bladder cancer classifications.

We do not intend to fund further development of this program without a collaboration partner or before we report AFFINITY results.

In addition to the bladder cancer data already reported, it is important to remember that we are also expecting results from our largest Apatorsen trial to date, our ongoing investigator-sponsored phase 2 Borealis-2 study.

Borealis-2 is evaluating Apatorsen in combination with docetaxel treatment compared to docetaxel alone in patients with advanced metastatic bladder cancer who have disease progression following first-line platinum-based chemotherapy. The trial has randomized approximately 200 patients and results are expected in the second half of this year.

With encouraging results already in first-line metastatic patients with poor prognosis as well as in patients with non-muscle invasive bladder cancer and given the unmet need, we look forward to continued evaluation of Apatorsen in this important disease.

That concludes my summary of our clinical development programs, our upcoming milestones and our perspectives on the prostate, lung and bladder cancer markets and how our product candidates fit into the treatment landscape for these diseases.

At this time, I’d like to turn the call over to John, who will review our current cash position and first quarter financial results.

John?.

announcement of the phase 3 AFFINITY trial results in the third quarter of 2016; announcement of the phase 2 Borealis-2 trial results in the second half of 2016; announcement of the phase 2 Spruce trial results for the overall survival endpoint in the second half of 2016; completion of a submission-ready IND application for Apatorsen treatment in patients with non-muscle invasive bladder cancer; and announcement of the phase 3 ENSPIRIT trial in the first half of 2017.

Revenue for the three months ended March 31, 2016 and 2015 were $2.9 million and $1.4 million, respectively. The increased revenue in 2016 as compared to 2015 was due to higher collaboration revenue recognized as a result of higher ENSPIRIT trial costs.

This was partially offset by a decrease in revenue recognized for the AFFINITY trial as a result of a decrease in associated clinical activities as this trial nears completion. Total operating expenses for the three months ended March 31, 2016 and 2015 were $7.4 million and $6.4 million, respectively.

Net loss for the three months ended March 31, 2016 and 2015 was $3.7 million and $4.5 million, respectively. That concludes the summary of our first quarter financial results. I’d like to now turn the call back over to Scott.

Scott?.

Thanks, John. The second half of this year includes a number of significant catalysts including results from our phase 3 AFFINITY trial of prostate cancer as well as important data from our Borealis-2 bladder cancer trial.

And as we look out into the first half of next year, we expect results from our phase 3 ENSPIRIT trial in lung cancer, a pivotal study that has already successfully completed a final and more rigorous interim futility analysis.

At the prostate, lung and bladder cancer markets continue to expand and call for more treatment options, we believe Custirsen and Apatorsen are uniquely positioned to provide a meaningful difference to patients. We are excited about these opportunities and we look forward to additional data to be gained in the third quarter this year.

Thank you again for your continued interest in OncoGenex and we look forward to speaking with you again soon. I’d now like to invite the operator, Latoya, to open the call for questions..

[Operator Instructions] The first question is from Katherine Xu of William Blair..

I’m just wondering, Scott, you talked about the FIRSTANA study potentially moving Jevtana to the front-line.

But if you’re considering Custirsen in combination with Jevtana in that setting, are you going to see [indiscernible] prognostic factors?.

Cindy, you are online, I believe, this afternoon and I think that’s probably a great question for you to consider for Katherine..

One of the things that we would be considering is obviously if successful with AFFINITY showing that Custirsen in combination with Jevtana has improved survival over Jevtana alone, we would be looking at moving it into first-line most likely with patients that could have more poor prognostic features and have those discussions with the FDA to look at such a trial..

Thank you. And all the best with the Q3 AFFINITY release..

Thanks a lot, Katherine. Looking forward to it. There is a lot coming up in the second half of this year..

We have another question from Danielle Brill of Needham & Company..

I’m on for Chat this evening. I just wanted to clarify, the IND you’re preparing for the intravesical administration of Apatorsen is you’re not planning on running any trial on your own; you’re seeking a partner for any development.

You’re just preparing the IND, is that correct?.

Yes. Right now, we are preparing the IND and the plan for future development will depend a lot on our second half of the year actually. Clearly if AFFINITY is positive and we start moving towards commercialization, then I think our ability to conduct a trial of that nature is obviously much easier than it would be if the trial is not successful.

In the alternative, obviously we’d be looking more for partnering strategies and the like. So I think it’s you’ll have to see how the back half of this year shapes up for us and that will help determine how we execute on that plan..

Best of luck to you..

Thank you very much..

[Operator Instructions].

Latoya, this is Jim. If I could just insert one thing before we close out the call. As Scott was reading the discussion about our estimated treatable patients for non-muscle invasive bladder cancer patients, there was a little bit of a break in the audio.

So I, just for the record, just wanted to restate that number and we estimate that number to be approximately 90,000 treatable non-muscle invasive bladder cancer patients in the US. So I just wanted to make sure that was restated correctly..

Thanks, Jim. Didn’t realize we had a break in the audio..

Yeah, I just wanted to make sure, thanks, Scott..

Latoya, do we have any other questions queued up?.

There are no questions in the queue. I’ll turn the call back over to Scott for closing remarks..

Great, thank you very much. And thank you again for participating in our call this afternoon. We look forward to sharing additional results with you from our phase 3 AFFINITY trial and our phase 2 Borealis-2 and Spruce trials later this year. We expect all of those to occur in the second half. Thank you very much for participating. Bye for now..

Thank you. Ladies and gentlemen, this concludes today’s conference. You may now disconnect. Good day..