Diane Weiser - VP of Corporate Communications & IR Andrew Wolff - Senior VP & Chief Medical Officer Robert Blum - President, CEO & Director Peter Roddy - Senior VP & CAO Fady Malik - EVP of Research & Development.

Jason Butler - JMP Securities Vikram Ashoka - Morgan Stanley Joe Pantginis - Rodman & Renshaw Mara Goldstein - Cantor Fitzgerald Charles Duncan - Piper Jaffray Ritu Baral - Cowen Chad Messer - Needham & Company.

Good afternoon and welcome, ladies and gentlemen, to Cytokinetics' Second Quarter 2017 Conference Call. At this time I would like to inform you that this call is being recorded. [Operator Instructions]. I will now turn the call over to Diane Weiser, Cytokinetics' Vice President of Corporate Communications and Investor relations. Please go ahead..

Good afternoon, everyone and thanks for joining us on the call today. Robert Blum, our President and Chief Executive Officer, will kick us off with highlights from the quarter. Then Andy Wolff, our SVP and Chief Medical Officer, will provide updates on VITALITY-ALS and VIGOR-ALS.

Fady Malik, our EVP of Research and Development, will then provide an update on CK-2127107 or CK-107 and the ongoing clinical trials in this program. Fady will also provide an update on the Phase III development program for omecamtiv mecarbil.

Pete Roddy, our SVP and Chief Accounting Officer, will then provide a financial overview for the quarter and Robert will wrap things up with additional corporate updates, perspectives and upcoming milestones before we open the call for questions.

Please note that portions of the following discussion, including our responses to questions, contain statements that relate to future events and performance rather than historical fact and constitute forward-looking statements for purposes of the safe harbor provision of the Private Securities Litigation Reform Act of 1995.

Examples of forward-looking statements may include statements relating to our financial guidance and goals, our strategic initiatives, our collaborations with Amgen and Astellas, clinical trials and the potential for eventual regulatory approvals of our product candidates.

Our actual results may differ materially from those projected in these forward-looking statements. Additional information concerning factors that could cause our actual results to differ materially from those in these forward-looking statements is contained in our SEC filings including our most recent 10-Q, 10-K and 8-K.

We undertake no obligation to update any forward-looking statements after this call. And now I will turn the call over to Robert..

Thank you, Diane and thanks to everyone for joining us on the call today. During our last earnings call we announced Sharon Barbari's plans to retire and we introduced you to Pete Roddy, our Chief Accounting Officer. Today, I'm pleased to also introduce the newest member of our senior leadership team, Ching Jaw.

Ching is Cytokinetics' Chief Financial Officer. Ching brings over 20 years of experience leading financial operations for big pharma, biotech and diagnostics companies as well as a particular expertise in commercial finance, contracting, supply chain management, international operations and M&A.

Most recently, Ching was CFO of Sanofi's North American pharmaceuticals business and previously he served as CFO of Ventana Medical Systems, a Roche company, as well as CFO of Roche's sales and marketing affiliate in Taiwan.

Ching also held senior financial positions in the R&D organization at Genentech and prior to transitioning into the healthcare industry he served in financial engineering positions at Honeywell and Caterpillar respectively.

He'll be working closely with me and Pete as well as others in our senior leadership team to further prepare Cytokinetics for potential commercialization activities as well as international expansion, as our business may mature and we execute on our corporate development plans. Please join me in welcoming Ching to Cytokinetics.

Now moving to highlights of the quarter, Q2 was another busy and productive time for us as we advanced our late-stage pipeline of muscle biology-directed investigational medicines and we readied for clinical trial data readouts and potential NDA and EMA filings.

We're pleased to have raised approximately $100 million in Q2 which is intended to support regulatory and commercial readiness activities for tirasemtiv as well as unpartnered research programs which we may advance a potential drug candidate into development this year.

VITALITY-ALS and VIGOR-ALS continue to progress well and based on our projections for the last patient, last visit, we're on track to announce results from VITALITY-ALS in Q4. Towards that objective, we've recently amended the statistical analysis plan for VITALITY-ALS and we're preparing for database lock, as Andy will elaborate in a moment.

Also during the quarter we continued to enroll patients with SMA into Cohort 2 of our Phase II clinical trial of CK-107 and we recently presented baseline demographics of patients from Cohort 1.

Fady will provide an update on how enrollment is tracking as well as when we believe we'll have data from this trial which may inform progression to Phase III. Recently, we also began 2 additional clinical trials of CK-107, 1 in elderly adults with limited mobility and 1 in patients with ALS.

With these new trials also underway, under our collaboration with Astellas, CK-107 is now the subject of 4 mid-stage trials in both neuromuscular as well as non-neuromuscular conditions in which impaired muscle function plays a key role in disease progression and impairment of function.

The breadth of this clinical trials program underscores the shared commitment we have with Astellas to fully recognize the potential value of this next-generation fast skeletal troponin activator or FSTA, as we say and I'm pleased to report the progress we've made together.

Fady will provide details on this program as well as share with you the progress relating to the development program for omecamtiv mecarbil under our collaboration with Amgen.

As you'll hear the team elaborate in a moment, momentum continues across the breadth of all our programs and we're enthusiastic about our progress as well as prospects for the balance of 2017. Now I'll turn the call over to Andy so he can update you first on tirasemtiv..

Thanks, Robert. In the past quarter, we continued to conduct VITALITY-ALS and the enrollment of patients into VIGOR-ALS, our open-label extension trial of tirasemtiv for patients who have completed VITALITY-ALS.

As Robert mentioned, as we advance VITALITY-ALS toward database lock, analyses and the readout of results, we recently amended the statistical analysis plan for VITALITY-ALS. We took that action for 2 principal reasons.

One, in consideration of feedback we have received on the clinical meaningfulness of the different secondary endpoints; and, two, based on a review of the blinded aggregate event rate in VITALITY-ALS.

Specifically, we elected to prioritize the analyses of 2 of the prespecified secondary endpoints, one, the change from baseline in the ALSFRS-R respiratory subdomain which is the sum of the scores of the last 3 items that relate to breathing; and, two, the slope of the change from baseline in muscle strength.

To remind you, both of these existing secondary endpoints are evaluated in VITALITY-ALS over the entire 48 weeks of double-blind, placebo-controlled treatment.

Because both of these endpoints are viewed as especially clinically meaningful by ALS clinicians, regulatory authorities and payers, we wanted to ensure that both would be formally analyzed and thus elevated them in the statistical hierarchy of prespecified secondary endpoints which will be tested following what we hope will be a statistically significant result on the primary efficacy endpoint which as you know is the change from baseline to 48 weeks in slow vital capacity.

In 24 weeks in slow vital capacity. In terms of database lock and preparedness, we believe the timing of the last patient visit and the current status of data collection in VITALITY-ALS puts us on track to have results in the fourth quarter.

Moving to VIGOR-ALS, we're pleased that still more than 90% of patients who have completed VITALITY-ALS are electing to enroll into the open-label extension.

We're also noting that a significant number of patients in VIGOR-ALS are choosing to up-titrate to the maximally permitted dose of 250 milligrams twice a day which is encouraging for the tolerability of tirasemtiv.

Now I will turn the call over to Fady to provide an update on CK-107, our next-generation FSTA, as well as an update on omecamtiv mecarbil..

Thanks, Andy. During the quarter, we also made progress advancing the clinical trials program for CK-107. First, we received notice that the Office of Orphan Products Development of the FDA granted orphan drug designation to CK-107 for the potential treatment of spinal muscular atrophy or SMA.

Next, in collaboration with our partner Astellas, we began new clinical trials and now have 4 mid-stage clinical trials underway with this next-generation FSTA, the broadest clinical development program across our pipeline.

With CK-107, we're exploring the potential to treat patients with both neuromuscular and non-neuromuscular conditions in which impaired muscle function and weakness plays a role.

I'll address the two new clinical trials we started in the last month in a moment, but first I want to update you on our Phase II trial of CK-107 in adult and adolescent patients with SMA. Recently we presented baseline demographics and reasons for screen failures in the trial at the Cure SMA meeting.

We issued a press release detailing the data, so I won't -- I will just briefly recap. On average, symptom onset was 22 years prior to enrollment, with a confirmed diagnosis 11.6 years before enrollment. There was an approximately even split between males and females enrolled and a similar split between ambulatory and non-ambulatory patients.

In terms of motor measurements at baseline, ambulatory patients had an average score of 48.8 in the Hammersmith Functional Motor Scale Expanded or HFMS-E, while non-ambulatory patients scored 18.9 in the Hammersmith scale. The Hammersmith scale ranges from 0 to 66 points, with higher scores indicating a greater degree of function.

The screen failures in Cohort 1 were primarily due to a Hammersmith score that was either too high in ambulatory patients or too low in the non-ambulatory patients. There were no statistically significant differences in the baseline demographics of enrolled patients compared to screen failures.

As you'll recall, we began enrolling Cohort 2 about 4 months ago and while enrollment is progressing at a better rate than occurred in Cohort 1, this trial is not enrolling at the rate that would allow for its readout by year-end. We do not believe that our delay is due to the availability of SPINRAZA, as some have asked; quite the opposite.

In fact, the availability of SPINRAZA has led many of the older SMA patients to reconnect with their local clinic to learn more about the new treatment and clinical trial options which has been a positive for us. Instead, the bigger issue is the higher than expected rate of screen failure due to the Hammersmith inclusion criteria.

Since the Hammersmith score is not commonly used to assess adolescents or adult patients, these data are not available for prescreening and it is challenging to assess the patient's functional ability by telephone.

As we've reported already, many are either too functional or not functional enough to be eligible for inclusion in our clinical trial which is forging a new potential path forward in older patients with SMA. That said, we now have 17 sites activated and are nearly midway through enrolling the number of required patients in Cohort 2.

We're working closely with our investigators to identify potential patients and now anticipate completing enrollment in this trial prior to year-end. That means data from this trial would be available in the first quarter of 2018.

We don't believe Cohort -- we don't believe enrollment of Cohort 2 will greatly impact the overall development time line for CK-107 in patients with SMA and its potential progression to late-stage development, with -- were results to be positive.

Moving to the other clinical trials in our collaboration with Astellas, we recently announced the start of a Phase II clinical trial of CK-107 in patients with ALS called FORTITUDE-ALS. Details of the trial are now available on clinicaltrials.gov.

In this trial, the primary efficacy endpoint will be change from baseline in the percent predicted SVC at 12 weeks. Secondary endpoints are measures of muscle strength as well as change from baseline in the ALSFRS-R.

We're also incorporating new exploratory endpoints focused on self-assessments of respiratory function and disease progression through quantitative measurement of handwriting and speech, utilizing novel digital applications.

This trial now underway is further evidence of our industry-leading commitment to patients with ALS and the pioneering of new assessments in clinical research. At the same time, we're studying our investigational medicines.

This Phase II trial of CK-107 is being conducted by Cytokinetics in collaboration with Astellas and will enroll over 400 patients in the U.S. and Canada. Additionally, Astellas recently began a Phase Ib clinical trial of CK-107 in elderly adults with limited mobility.

This trial will enroll approximately 60 subjects between the ages of 70 and 89 and assess the effect of CK-107 on skeletal muscle fatigue measured by change in baseline versus 14 days of treatment in the sum of peak torque during isokinetic knee extensions.

This trial will also assess the effect of CK-107 on physical performance via a short battery of physical performance tests including stair-climbing and 6-minute walk.

Exploring the potential of CK-107 in elderly adults with limited mobility or frailty is especially exciting, as this clinical trial may provide a window into how fast skeletal troponin activation may one day improve health span in our ageing population by potentially improving muscle function, exercise performance and stamina.

We're pleased that Astellas shares our commitment to pursue a broad-based development plan for CK-107. Now I'll move to our cardiac muscle program and provide an update on omecamtiv mecarbil and GALACTIC-HF. This morning we announced results from the Phase II trial of omecamtiv mecarbil in Japanese patients.

As you'll recall, this trial was conducted to inform the inclusion of Japan in GALACTIC-HF and based on the results and discussions with PMDA, the Japanese regulatory authority, Amgen and Cytokinetics are now proceeding with startup activities for Japanese sites to participate in this 8,000-patient cardiovascular outcomes trial already underway.

Upon initiation of dosing of omecamtiv mecarbil in Japanese patients in GALACTIC-HF, Cytokinetics is eligible to receive a milestone payment of $10 million. At the same time, Amgen continues to work around the world to activate study centers and enroll patients into GALACTIC-HF.

Over 500 sites have now been activated in more than 25 countries and the study is on track with regards to patient enrollment. We're pleased with the rate of enrollment and believe we're on schedule with agreed plans for this first Phase III clinical trial under our collaboration with Amgen.

Regarding the second planned Phase III clinical trial, in the second quarter Cytokinetics convened an advisory board meeting to gain input from key opinion leaders on study design.

This next Phase III clinical trial of omecamtiv mecarbil will be designed to examine the effects of omecamtiv mecarbil on exercise tolerance and cardiac function in heart failure patients. As a reminder, this trial will be conducted by Cytokinetics in collaboration with Amgen, but will be primarily funded by Amgen.

Also during the quarter, John Teerlink presented results from the dose escalation phase of COSMIC-HF at Heart Failure 2017, the annual congress of the Heart Failure Association of the European Society of Cardiology.

The dose escalation phase of COSMIC-HF supported the selection of the optimal formulation of omecamtiv mecarbil based on low peak-to-trough variability in plasma concentration. In addition, it formed the implementation of the PK-based dose titration strategy that was employed in the expansion phase of COSMIC-HF.

This same formulation is now being used in GALACTIC-HF along with an optimized PK-based dose titration strategy. So with those updates, I'll now turn the call over to Pete to provide an update on our financials..

Thank you, Fady. This update will include comments regarding our cash, our spending on research and development and an update on guidance for 2017. More details are included in the press release itself. Robert already highlighted that we raised approximately $100 million during the second quarter.

The amount raised in Q2 2017 is in addition to the $100 million we raised in Q1 2017 from the royalty monetization deal with Royalty Pharma.

The tally for Q2 2017 includes our successful $83 million public stock offering underwritten by Morgan Stanley, $12 million from the completion of our at-the-market offering as well as $11 million from the exercise of warrants originating in the 2012 financing.

As a result, we ended the second quarter with $332 million in cash, cash equivalents and investments which represents over 24 months of going-forward cash burn based on our 2017 financial guidance. Revenues for Q2 2017 were $3.1 million and for year-to-date 2017 were $7.2 million, compared to $5.8 million and $14.2 million for those periods in 2016.

Year-to-date 2017 revenues included $6.7 million of research and development revenues and $6.4 million of license revenues from our collaboration with Astellas and $1.3 million of research and development revenues from our collaboration with Amgen.

To remind you, we reduced our revenues for payments to Amgen related to the exercise of our option to co-fund the Phase III development program of omecamtiv mecarbil in exchange for increased royalty upon potential commercialization. Those payments totaled $7.5 million for the 6 months ended June 30.

We expect to continue to make additional quarterly co-funding payments of $6.3 million through to the end of 2018 for a total of $40 million. Our second quarter 2017 R&D expense totaled $19.8 million and our year-to-date R&D expense was $39.1 million.

From a program perspective for year-to-date, approximately 83% of our R&D expenses were attributable to our skeletal muscle contractility programs which include both expenses associated with tirasemtiv and CK-107; 12% to our cardiac muscle contractility program; and 5% to other research activities.

G&A expenses continue to include both general and administrative expenses as well as internal and outside services focused on commercial readiness. Our guidance for 2017 included cash revenue from $21 million to $23 million, cash R&D from $108 million to $112 million and cash G&A from $30 million to $32 million.

While our recent financing allows us to accelerate some of the regulatory and commercial readiness activities for tirasemtiv, those activities and the related expenses start this year and are expected to continue into 2018. The cash needs for those activities in 2017 are within the ranges of our existing guidance for 2017.

We plan to provide guidance for 2018 with our Q4 earnings. And with that, I'll turn the call back over to Robert..

Thank you, Pete. So as you've heard, in Q2 we advanced our pipeline and added to our balance sheet in preparation for potentially positive results from VITALITY-ALS.

Consistent with these preparations, we're making key strategic hires to ensure we have the appropriate personnel in place to continue to mature the company and our operations in anticipation of potential commercialization activities. For example, in the second quarter we stepped up market research and market access activities in both the U.S.

and Europe. We want to best understand the potential landscape for tirasemtiv and the interests, objectives and data needs of HTAs and payers.

We're also engaging on both sides of the ocean in lending support to academic and patient advocacy initiatives that are intended to collect real-world data in clinical practice registries as well as patient survey projects, both of which we believe could be helpful to regulatory as well as reimbursement authorities.

Lastly, from the pre-commercialization standpoint, we're in the process of planning and contracting for key components of the supply chain, including third party logistics providers, hub service providers and specialty pharmacies and establishing frameworks for our IT commercialization infrastructure as well as conducting key positioning and branding initiatives.

Also during the quarter, we were proud to announce the renewal of our partnership with The ALS Association in the fight against ALS which includes Cytokinetics' renewal of sponsorships at both the national and local levels.

As the pipeline of recently approved and investigational medicines for ALS advances, it's even more important to step up our collective efforts to increase awareness, education and fundraising for the people fighting this dreadful disease.

In summary, our activities across the breadth of the company continued to advance well in the second quarter of 2017. We remain optimistic about our prospects for the balance of the year across our diverse portfolio of novel-mechanism muscle biology-directed drug candidates.

As always, our focus continues to be on the patients who desperately need new therapies to treat their severe and devastating diseases of impaired muscle function. Now I'll recap our expected milestones for the rest of 2017.

For tirasemtiv, we expect results from VITALITY-ALS in the fourth quarter of 2017 and we expect to continue to enroll patients who complete VITALITY-ALS into VIGOR-ALS throughout the year. For CK-107, we expect to complete enrollment of Cohort 2 of a Phase II clinical trial in patients with SMA in 2017.

We expect data from the Phase II clinical trial in patients with SMA in the first quarter of 2018. We expect Astellas to continue enrollment in a Phase II clinical trial of CK-107 in patients with COPD as well as the Phase Ib clinical trial of CK-107 in elderly patients with limited mobility throughout 2017.

And we expect to continue enrollment in our Phase II clinical trial of CK-107 in patients with ALS throughout 2017. For omecamtiv mecarbil, we expect continued enrollment of patients with chronic heart failure in GALACTIC-HF throughout the year.

And for preclinical research, throughout 2017 we expect to continue research activities under our joint research program with Amgen directed to the discovery of next-generation cardiac muscle activators as well as under our joint research program with Astellas directed to the discovery of next-generation skeletal muscle activators.

And we expect to nominate at least 1 potential drug candidate from research programs into development in 2017. Operator, with that, we can now open up the call to questions, please..

[Operator Instructions]. Your first question comes from the line of Jason Butler with JMP Securities..

Just the first 1 on VITALITY.

Do any of the statistical plan amendments impact -- or did they impact the powering of the primary or the secondary endpoints in any way?.

So certainly that's not the case. With respect to the primary endpoint, we didn't make any changes.

With respect to the secondary endpoints, what we did is, we elevated 2 of the already prespecified endpoints higher into the hierarchy and we did that, as Andy pointed out, for reasons that we think they may be deemed more meaningful to regulatory authorities, payers and clinicians; but also based on a review of the blinded data, where we thought we had more statistical power.

But I don't think, as your question may likely be pointed, there was anything in the methodologies that would change the statistical power..

Okay.

And then, in terms of the blinded data you've seen, is there anything in the dataset that suggests that the decline or change in the ALSFRS is different than you saw in BENEFIT-ALS or other historical ALS trials?.

With respect to the overall ALSFRS? Is that your question?.

Right. Yes..

We can't really ascertain that from blinded data, but what we do know is that there are quite a fair number of declines in those last 3 items I mentioned that deal with dyspnea orthopnea and noninvasive ventilation. So in BENEFIT-ALS, as we've mentioned in the past, over the 12 weeks of the trial there was almost no change in any of those items.

Patients came in, almost all of them at 4 and they left the trial almost all of them at 4, regardless of whether they were on tirasemtiv or placebo. But over a much longer trial duration now, we're seeing a number of declines in those items. So that tells us we would have meaningful statistical power against them.

And they are also, as we mentioned earlier, viewed as more clinically meaningful by payers, by regulators and even by clinicians..

I think another thing to point out as to why we did what we did is, we think that by elevating these into the ladder of statistically relevant, we hope, secondary endpoints, we have something that may better corroborate what we're hopefully going to be seeing in the primary efficacy endpoint in terms of expanding this potential story..

Okay. Great.

And then, just last question from me -- in terms of the Japanese Phase II results for omecamtiv mecarbil, can you put into context with us the data you got for systolic ejection time and is it possible to make any comparison to COSMIC and make any judgment as to whether the efficacy you're seeing in Japanese patients is similar to what you saw in COSMIC?.

Yes. I think as I -- as we've said in the press release, I think the results from the Japanese Phase II study were generally in line with COSMIC in both systolic ejection time and pharmacokinetics, were the 2 things we mentioned.

So very consistent with what we saw in COSMIC and I think that'll -- when the details of that study are -- come out, you'll see that that's the case..

Thank you, Jason..

Your next question comes from Matthew Harrison with Morgan Stanley..

This is actually Vikram on for Matthew at Morgan Stanley. So a couple of questions from our side.

First, on the Phase III GALACTIC-HF program, could you remind us on the timing for the interim analyses in that program? And then a follow-up to that, on the FORTITUDE-ALS program that was recently announced, what are your expectations for how long that may take to enroll and when we could see some initial data?.

Yes. So I'll tackle those. With respect to interim analyses for GALACTIC, I think it's premature to speculate too much on that. The study is, as you know, just early in its enrollment phase and as it may enroll this year and next year, we could conceivably have enough events to enable interim analyses in the 2019-2020 time frames.

But I think that's the best we could do right now, given how the study is designed, the rate of enrollment and when we might expect to see interims. And there are interims, as we will elaborate over time, that relate to futility as well as potential overwhelming efficacy.

But again, too early, I think, to really comment much more beyond what I just said. Secondly, with respect to FORTITUDE-ALS, that study just started, but we do expect that it should enroll relatively quickly, like did BENEFIT-ALS and like did VITALITY-ALS. Once we see patient enrollment we'll be able to be a bit more precise.

Right now, we're pointing to results from FORTITUDE-ALS to occur in 2018. My hope is that that may be closer to mid-year, but right now I think it's a bit premature..

Understood. And then, actually, 1 more question, if you don't mind. Could you just go back to the delay on the data from the Phase II SMA program? I didn't quite catch what the rationale was behind the slower than expected enrollment for that program for Cohort 2..

Yes. So the reason really has to do with screen failures and the sites have been fairly active in terms of identifying and screening patients, but we have seen a higher than expected screen failure rate based on the Hammersmith score which is a motor function score.

So patients in general would screen fail either because their function was too good and that would obviously limit your headroom in terms of detecting an effective drug that might improve motor function or their function was too poor and we felt potentially not modifiable by a drug intervention.

And so, even though the entry criteria are broad, going from 10 to 56, I believe, we tend to find the patient population looks bimodal. Meaning, either clustered down in the lower end or at the higher end. And so, finding those patients has been harder than anticipated and has led to that higher than anticipated screen failure rate.

So that obviously means a slower than anticipated enrollment rate..

Thank you..

Your next question comes from Joe Pantginis from Rodman & Renshaw..

Thanks again for such a detailed update, as usual. Wanted to ask a question that's more macro-based with regard to ALS and clinical endpoints.

From the time you guys announced the data from BENEFIT-ALS, you had to embark on a bit of a -- I'll put [indiscernible] in quotations, regulatory discussions with regard to the -- defining the clinical endpoints for VITALITY, et cetera, being SVC.

So with that said and talking about that evolution, there was a recent paper by Susana Pinto in the ALS and Frontotemporal Degeneration Journal that showed strong correlation between FVC and SVC.

And I think my question really looks to, is -- are your discussions in how the field is emerging, this paper as an example -- how is it translating to the real world and also in the clinical setting, with regard to the acceptance of SVC as a clinical endpoint? I know that was long-winded, but I just wanted to make sure we talked about the evolution..

Yes, I think I understand the question. I'll turn it to Fady, maybe, to start and then maybe if Andy and I had anything after that, we'll elaborate..

I think the Pinto paper you're referring to had a couple points that are germane to our program and the first is that we use SVC and the field has used SVC but they've also used forced vital capacity or FVC.

And the question has always been, are the two really the same measurement of just vital capacity? And the Pinto paper showed a very high correlation between those 2 metrics over time in a cohort of ALS patients in their clinic.

And so, I think that helps to bolster our statement and our belief that vital capacity is vital capacity regardless of whether you measure it using slow vital capacity or forced vital capacity.

In terms of the acceptance of vital capacity as an endpoint, I think there are other analyses that will be coming out that show how it's related to longer term clinical outcomes, even eventual mortality, initiation of NIV, disability and things like that and as that literature evolves over time I think that will go on to bolster the relationship of vital capacity to meaningful clinical endpoints..

So you also asked about the landscape and how it's evolving. Maybe this is a good time for me Andy, if you want to elaborate on some of the initiatives you've been involved in that The ALS Association and others have organized..

So I participated, along with around 80 other people -- largely ALS clinicians, clinical experts, clinical investigators; also some representatives from patient advocacy groups and even some patients with ALS -- in putting to FDA some draft guidance. They haven't updated their guidance for the development of drugs intended to treat ALS for some time.

And there is a strong consensus among that writing group that vital capacity as well as other measures like muscle strength are appropriate primary endpoints for trials intended to support registration. So FDA's had that. They said nice things about it.

We don't know what they're going to do in terms of revising their draft -- or revising their guidance, if they do anything. But it certainly was a statement that represents the community at large. In parallel, another effort was to publish guidelines for clinical trials in ALS.

Obviously something of -- a fair amount of overlap between the 2 efforts, but they're not exactly the same. That draft manuscript, as well, endorses vital capacity as appropriate primary endpoint for trials intended to support registration. So I think the community's definitely behind it.

And I -- finally, I think if you look at some of the decisions that this division has made regarding recent approvals, I think a robust effect on vital capacity will be difficult for them to ignore..

Yes. I was going to just maybe add a bit of color commentary to that statement. We've been good students about what has been going on around us with regard to the approval of Radicava as well as other activities in the environment around which we operate.

And clearly, there is a lot of optimism that the division of neurology within the FDA is looking at ALS as a disease that merits the urgent review and approval of new, safe medicines and that endpoints like respiratory endpoints and in particular vital capacity, could be supportive of registration.

And I think there's a consensus that's been formed really since the time we started VITALITY-ALS, perhaps catalyzed in part by some of the work that we've been doing, but not necessarily only because of what we've been doing.

I think there's clearly trends that support that a drug that would have an effect on slowing the decline of respiratory function would be met with significant enthusiasm on the part of the ALS community, payers and hopefully also regulatory authorities..

Got it. Guys, thanks very much for all the added details. Appreciate it..

Thank you..

Your next question comes from Mara Goldstein with Cantor Fitzgerald..

Can you hear me?.

Yes..

Great. Thank you. I dropped the phone while I was picking it up. I just want to ask to go back to the screening issue for 107.

And the question I had is that, is that particular screening issue around the parameters around functionality and the requirements for that trial -- is it generalizable to the commercial market and does it change the way that you might think about perhaps the construct of future trials to maximize patient population or is it really just too early to even think about that?.

No, it's not too early at all and I think it does read on how one should be looking for adolescents and adults with this disease at endpoints that may be more relevant to their functional decline and interest.

So clearly, the Hammersmith scale was initially constructed around a way of measuring impairment in infants as they develop and as they track progression to pediatric years.

And I think what we have come to appreciate, both from talking to patients as well as caregivers as well as clinical researchers, is that there are aspects of the Hammersmith scale that may not so relevant for adolescents and adults.

For instance, how they may turn over which is clearly something that is a measure of function in infants and it can also be embarrassing if not humiliating for those patients to undergo those kinds of assessments.

So we're in conversations with clinicians and regulatory authorities about what may be more appropriate endpoints for the older population as we contemplate progression to Phase III.

It's not to say that the Hammersmith doesn't still have in its scale elements that are incredibly relevant for measuring drug effect and essential treatment benefit, but I think there are aspects of it that might need refinement.

And in that way, I think we'll take our guidance from others in terms of how best to assess performance and function in these patients..

Right. But this is something you would theoretically take to FDA to arrive at agreement on in Phase III endpoint..

Yes. And keep in mind, in our Phase II study, the ongoing trial, this is hypothesis-generating. Our efficacy analyses will span a number of different endpoints that will be hopefully relevant to both ambulatory and non-ambulatory patients and with data in hand we believe we can have a much more constructive conversation with regulatory authorities..

Okay. And if I could just ask, I recall that last quarter we discussed manufacturing for tirasemtiv and there's been some discussion on this call. But I'm wondering where you think you'll be with respect to the CMC by the time you have the clinical data for VITALITY-ALS in hand..

Yes. So we're in the process right now, at risk of scaling up manufacturing and ensuring that we have validation batches produced and on stability so that this should not be rate-limiting..

Okay.

And if I could just -- I apologize -- sneak 1 more question in and that is, I know that you've spoken to the possibility of having data at the ALS meeting in December and do you think that is still on track?.

Yes. We believe it's on track, such that we should have results from the VITALITY-ALS trial for public presentation at the ALS/MND meeting. Thank you..

Your next question is from Charles Duncan with Piper Jaffray..

Robert, congrats on an increasingly visible and broad pipeline. I had a question on VITALITY. I just wanted to go back and ask for a little bit more color on the changed statistical analysis plan.

Seems to make a lot of sense in terms of gleaning clinical meaningfulness out of that study; but I'm wondering, related to the kind of event rates or what you're seeing in terms of patients' change in their, I'll call it breathing, that Andy referred to, do you feel like that that is just a function of it being a longer study, people being perhaps a little bit further on in their disease or having time to progress? Or could there be changes or differences in the patient heterogeneity in VITALITY relative to the Phase II study, BENEFIT-ALS?.

I think it's definitely not related to baseline characteristics of patients enrolled in VITALITY, but rather instead, as you pointed out, a longer duration of the study.

Andy, if there's anything else you want to add?.

No, that's exactly what I would have said. I think it's just, as patients are on treatment for longer, we're going to see more disease progression..

So in many ways that should really enhance the signal-to-noise potential of the study.

Correct?.

Could, yes. If you remember to the list of prespecified secondary endpoints -- and you can see these on clinicaltrials.gov; it's also been contained in one of the slides in our public presentations -- some of those secondary endpoints included a change from baseline in slow vital capacity of certain magnitudes.

And certainly that's interesting and hopefully will be evidenced in this study as compelling to favor drug versus placebo.

But I think it's fair to say that those would be incremental to what we might learn in the primary efficacy analysis and the things that we elevated in the statistical hierarchy are things that we think will add to, complement or supplement what we hope we'll see in the primary efficacy analysis.

So this should provide for a more well-rounded story, we hope, of a drug in ALS that could have potential benefit in terms of both respiratory parameters and other measures of muscle strength, including those that are in the ALSFRS..

Super. That makes sense to us in terms of our KOL diligence. I wanted to follow up on VIGOR. I think Andy mentioned a lot of interest in VIGOR for those patients completing the trial.

Do you have a sense of the percentage of patients completing the trial and can you provide any additional color on that?.

So the percent of patients who are rolling from VITALITY into VIGOR?.

Well, yes. Percentage of patients completing this study and then interest in VIGOR..

So we have communicated that over 90% of patients who are completing VITALITY-ALS are choosing to enroll into VIGOR. That's all we've said about that to this point..

And you can't at this point talk about the percentage of completers in VITALITY?.

Correct..

Okay. One last question, just hopping over to 107, because we're really intrigued with the broadening clinical development of that candidate. I'm wondering if you could characterize the patient population in FORTITUDE with 107 as relative to, say, the patient population in VITALITY with tira..

So those patient populations are very similar, actually. The -- their time to diagnosis is approximately 2 years. Their vital capacity cutoff, I believe, is the same as in VITALITY. There is not any significant differences between 50 -- FORTITUDE-ALS and VITALITY in terms of the entry criteria..

Okay. Last question, wild speculation, I know, but I just want to ask it.

If you think about the totality of information you have with 107 versus tira, if you had to pick one, either SMA or ALS which of the 2 would you like to best as a -- best test to evaluate 107 activity in?.

It's really hard to compare. I mean, you're talking apples and oranges. We already have validation with this mechanism of action from tirasemtiv in a similar patient population and in that way you might expect that we should anticipate seeing with CK-107 effects similar to what we saw with tirasemtiv in BENEFIT-ALS.

And the FORTITUDE study is designed very much like the BENEFIT-ALS study, albeit with priority to the primary efficacy analysis in slow vital capacity.

So I might anticipate that there's a higher probability of seeing a pharmacodynamic activity with CK-107 in FORTITUDE, but this mechanism of action has time and time again demonstrated increases in muscle force and power and time to fatigue -- in fact, in every clinical trial that we've conducted with a fast skeletal troponin activator, we've seen pharmacodynamic effects across multiple populations, starting with intermittent claudication and myasthenia gravis and more recently with ALS.

And therefore, I think we will be surprised if we don't see similar activity in a population with SMA. So I think the glass is half-full, both with respect to tirasemtiv and CK-107 and in both ALS and SMA. Thank you, Charles..

[Operator Instructions]. Your next question comes from Ritu Baral with Cowen..

I just wanted a little more elucidation on the change in the SAP. You mentioned you were elevating -- is it the ALSFRS-R that you are elevating or the three -- the breathing subscale that is its own distinct endpoint? You did mention the last three respiratory questions.

Is that what you're elevating -- the dyspnea orthopnea and respiratory insufficiency?.

Yes. It's the change from baseline in the sum of those 3 items..

Okay.

And do you have thoughts on how those 3 items as a subscale relate to SVC to primary endpoint?.

It's pretty clear from other datasets that we have examined -- we have access to a number of datasets from other clinical trials that the slower that SVC declines, the fewer declines in these 3 items there are.

And that's very clear and actually we can analyze these datasets and see highly statistically significant differences between fast decliners in vital capacity and slower decliners in terms of the number of drops in these 3 items in the respiratory subscale that they have.

So given that our primary therapeutic hypothesis for doing VITALITY-ALS is that the drug should slow the decline in vital capacity, as we observed in BENEFIT-ALS, we would expect then to see fewer declines or smaller declines in these respiratory items in patients treated with tirasemtiv.

Now we have no idea because we're looking at blinded aggregate data, but that definitely is the hypothesis and it can be supported by analyses of other databases..

And some of those analyses have been presented already publicly in scientific meetings and are available in abstract form and will be also available in published manuscripts over the next several months..

So do you believe that FDA would see the subscale dataset and the SVC dataset as mutually supportive in the event of strong trends or a near miss in statistical significance?.

I think they definitely would. I mean, they have always endorsed ALSFRS-R, both in terms of the total score, but have been open to just using the respiratory subs core. We think that might be where the effect of the drug might be most easily demonstrated..

And in fact that's what I meant by expanding the story and corroborating, because the ALSFRS, as you know, Ritu, is comprised of components that are both patient-reported as well as clinician-reported and this could be providing both symptomatic and other kind of functional supportive evidence, we would hope, for what we might see in terms of change from baseline in SVC..

Got it. And then you did mention that it was based on -- that these changes were based on a blinded event rate.

Were you referring to event rate -- the event rate of loss of SVC or was there another particular type of event that drove this decision?.

Well, we can just look at the blind data and see patients having drops in their scores on items 10, 11 and 12. We can count how many we have. We know..

Oh, so the event in question was a drop in 10, 11 and 12 rather than a drop in SVC or -- got it. Okay..

Right. I mean, we can look at that too, but it's not very helpful..

Okay. Got it.

And the last question, going back to the Japanese omecamtiv data, can you talk about the safety profile that that trial generated, specifically the -- any potential troponin excursions or other safety signals?.

I think I can just generally say that the safety in that study was comparable to what we saw in COSMIC, where the placebo and active treatment groups essentially looked the same..

Yes. We're talking to Amgen about how best to communicate these results in a broader way and more public and maybe we'll be in a position to comment on that soon enough.

But I think the bottom line is, this dataset is consistent with what we have seen in COSMIC which, as you know, we're quite positive and therefore supportive of moving forward in Japan in GALACTIC. Thank you, Ritu..

And your final question comes from the line of Chad Messer with Needham & Company..

If I could just start back at the changes in the statistical analysis plan -- I know we've covered a lot of ground on that, but I'm still trying to understand for myself exactly what it means to elevate in the hierarchy.

I know in the past you've always said you wanted to have -- to hit on your primary and have sort of corroborating data out of the secondary endpoints. I mean, when you say a hierarchy, that to me means you're going to kind of look at it first or use it in some kind of gating way.

Have we gained any liability by doing this? I mean, you were going to look at these endpoints anyway.

And then just a follow-up to that -- do we have data from the Phase IIb on these 2 elevated secondary endpoints and if so, how did it look?.

Well, I'll answer the second question first. No, we really don't have meaningful data from BENEFIT-ALS because, as we discussed earlier, it being only 12 weeks long, there weren't many declines in -- well, not for 1 of the 2 endpoints.

For muscle strength, we do and in fact we did go back and look at our muscle strength data from BENEFIT-ALS to conclude that we had significant statistical power on that endpoint. So that's 1 of the 2 that was elevated.

We couldn't take much from the respiratory subscore in BENEFIT-ALS because, as we discussed, over a period of 12 weeks it hardly changed at all in anybody. But we know that over longer periods of time in other studies, it does change and it changes according to the decline in vital capacity in those other studies.

I don't think we take any liability, because in a Phase III study you can't just formally -- I mean, you can test them, but then it would just be descriptive.

So to actually draw inferences that could support a label claim, you have to order the secondary endpoint as to how they would be tested in the event of a positive effect on the primary endpoint. So it's -- it was -- it's not a choice as much as it is an obligation..

But to your point about elevating in the hierarchy, it is true that we have predefined the hierarchical order of specified secondary endpoints and by elevating these on the ladder of secondary endpoints we're underscoring that we think these have the highest probability of being statistically significant and as we walk through these in a prescribed manner we're suggesting that if we don't hit on these endpoints that would render others to be more descriptive.

Thank you..

There are no more questions in the queue.

Do you have any closing remarks?.

I just want to say thank you to all the participants on the teleconference today. We very much appreciate your continued support and your ongoing interest in Cytokinetics. With that, operator, we'll now conclude the call..

This concludes today's conference and we thank you for your participation. You may now disconnect..