Good afternoon, and welcome to Syros Pharmaceuticals' Third Quarter 2020 Financial Results Conference Call. At this time all participants are in a listen-only mode. This call is being webcast live on the Investors and Media section of Syros' website at www.syros.com. Please be advised that today's call is being recorded.

Following the formal remarks, we will open the call up for your questions. [Operator Instructions] At this time, I would like to turn the call over to Naomi Aoki, Vice President of Corporate Communications and Investor Relations at Syros..

Thank you. This afternoon, we issued a press release with our third quarter 2020 financial results, along with anticipated future milestones and recent accomplishments. This release is available on the Investors and Media section of Syros' website at www.syros.com. We will begin the call with prepared remarks by Dr.

Nancy Simonian, our Chief Executive Officer; Dr. David Roth, our Chief Medical Officer; and Joe Ferra, our Chief Financial. We will then open the call for questions. Dr. Eric Olson, our Chief Scientific Officer; and Dr. Jeremy Springhorn, our Chief Business Officer, are also on the call and will be available for Q&A.

Before we begin, I would like remind everyone that statements we make on this conference call will include forward-looking statements.

Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our annual report on Form 10-K, our quarterly report on Form 10-Q that we filed this afternoon and any other filings that we may make with the SEC in the future.

In particular to the extent of which the COVID-19 outbreak continues to impact our operations and those of third parties on which we rely will depend on future developments, which are highly uncertain and cannot be predicted with confidence.

Any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. We would now like to turn the call over to Nancy..

Advancing SY-1425 as a foundational therapy for RARA-positive patients; delivering on the promise of CDK7 inhibition; and building a robust pipeline in oncology and monogenic diseases using our gene control platform. As we advance through the second half of 2020, our efforts are bearing fruit.

As David will review, we recently presented initial data from our ongoing Phase I trial of SY-5609 at the EORTC-NCI-AACR or ENA meeting. These early data reinforce our conviction in CDK7 inhibition as a potentially transformative targeted approach for difficult-to-treat cancers.

The data demonstrated biologic activity at tolerable doses and importantly, the level of biologic activity observed was associated with tumor regressions in preclinical models of 5609 and with clinical activity with our first-generation IV CDK7 inhibitor.

As we move forward in this trial, we are robustly evaluating 5609 with the goal of identifying optimal next steps toward delivering the greatest potential benefit for patients.

Meanwhile, we are advancing toward key readouts from the Phase II trial of 1425, which, as we announced this morning, will be highlighted in oral presentations at the upcoming ASH Annual Meeting in December. This is a very important milestone for Syros.

1425 has shown promising clinical activity in combination with azacitidine in newly diagnosed AML and has broad potential for a range of RARA-positive patients. Despite recent advances, about a third of newly diagnosed unfit AML patients still don't respond to upfront treatment.

Virtually all eventually progress and upon relapse there are unlimited options for patients. As David will share in a few moments, we are very encouraged by the data that continue to emerge from our Phase II trial.

We are also excited to share new data at ASH, suggesting that 1425 may be a promising option for patients who may be refractory to upfront treatment with venetoclax. We look forward to discussing all these data and providing next steps for development at ASH. Turning to our third pillar.

Our leading gene control platform is critical for fueling a robust and sustainable pipeline. While most of us have been working from home, our lab-based employees have continue to go into our labs to advance our preclinical and discovery pipeline.

We are making excellent progress on our early-stage pipeline, and we remain on track to nominate our next development candidate by the end of 2021.

Our progress across our three strategic pillars lays the foundation for significant growth for Syros, as we strive to build an enduring company with a portfolio of medicines that make a profound difference for patients. With that, I'd like to turn the call over to David to review our recent Phase I data for 5609 and our upcoming ASH presentation.

David?.

Thank you, Nancy, and good afternoon to everyone joining us. Let me begin by reviewing the initial Phase I data for 5609 that we announced last month at the virtual ENA meeting.

As a reminder, the Phase I dose escalation study is enrolling patients with advanced breast, colorectal, lung, ovarian or pancreatic cancer or with solid tumors of any histology that harbor RB pathway alterations. The study is also evaluating 5609 in combination with fulvestrant in patients with CDK4/6 inhibitor-resistant HR-positive breast cancer.

The data at ENA focused on safety, tolerability, PK and PD. As Nancy mentioned earlier, we are encouraged by the data we are seeing at this stage of the trial.

As of the August 21 data cutoff, 17 patients have been enrolled in the ongoing dose escalation trial, including 13 patients treated in the single agent cohorts and 4 patients treated in the fulvestrant-combination cohorts.

Across all the enrolled patients, the majority of adverse events were low-grade, and the most commonly reported AEs were nausea, diarrhea, fatigue, low platelets and vomiting. Importantly, e demonstrated proof of mechanism for 5609.

Through our work on CDK7 inhibition, we discovered that inhibiting CDK7 leads to increases in POLR2A messenger RNA, and we're measuring POLR2A as a PD marker in the trial. The data at ENA show dose-dependent increases in POLR2A in patients treated with 5609.

At the 3-milligram daily dose, POLR2A reached levels at steady state associated with tumor regressions in preclinical studies of 5609, and with CDK7 target engagement at which a durable clinical response and apoptosis were observed in a trial of patients with our first-generation IV CDK7 inhibitor.

As we move forward in dose escalation, we are further focusing on patient populations, we believe, are more likely to respond to 5609, exploring combinations and evaluating ultimate dosing regimens, all with the goal of identifying optimal next steps for both single agent and combination development opportunities.

We opened an extension cohort in lung cancer to further evaluate the 3-milligram daily dose in a select patient population. We believe there's a strong rationale for CDK7 inhibition in both small cell and non-small cell lung cancer based on our preclinical data and the genetics of these tumor types.

Small cell lung cancer has a high prevalence of RB alterations, which we've shown preclinically to be associated with deep and durable responses to 5609. And non-small cell lung cancer is often driven by oncogenic activation of MAP Kinase Signaling, which we identified preclinically as another dependency susceptible to CDK7 inhibition.

We also opened the trial to patients with advanced pancreatic cancer, a tumor type in which oncogenic activation of MAP Kinase Signaling and RB alterations also play key roles.

And we expanded the combination cohort in CDK4/6 inhibitor-resistant HR-positive breast cancer patients to further characterize safety, tolerability, PK, PD and antitumor activity of 5609 in combination with fulvestrant. Finally, we're exploring ultimate schedules and doses to position ourselves for various single agent and combination opportunities.

The exploration of ultimate regimens is also supported by preclinical data showing that we can achieve similar robust responses in preclinical models with daily and intermittent dosing schedules. Together, we believe these approaches will enable us to identify optimal next steps and ultimately best deliver on the promise of CDK7 inhibition.

We look forward to reporting additional data from the ongoing dose escalation, including clinical activity data in mid-2021. Let me now turn to SY-1425.

As Nancy mentioned, in two oral presentations at ASH we will be detailing clinical data from our fully-enrolled ongoing Phase II trial in newly diagnosed unfit AML patients and relapsed or refractory AML patients.

While we'll save the detailed discussion of the data for ASH, we're very encouraged by the results that continue to emerge from this study.

Beginning with the newly diagnosed unfit patient population, as noted in our abstract, the combination of 1425 and azacitidine continued to show high response rates in RARA-positive patients with rapid time to response and high rates of transfusion independence.

We also saw evidence of clinical activity in RARA-positive relapsed or refractory AML patients. And importantly, the 1425 azacitidine combination continue to be safe and well tolerated across both patient populations.

Also at ASH, we will present new data showing that the majority of RARA-positive patients have a disease phenotype that's associated with resistance to upfront treatment with venetoclax, highlighting the opportunity for 1425 to also address this emerging high unmet need in the newly diagnosed unfit AML patient setting.

Taken together, we believe the data we will be presenting at ASH describe compelling evidence for the potential of 1425 and support multiple opportunities to advance 1425 in combination in RARA-positive patient populations. We look forward to providing additional detail on our Phase II clinical results and our future plans at ASH next month.

With that, I'll pass the call over to Joe to review our financial results for the third quarter..

Thank you, David. We ended the third quarter in a strong financial position with $93.1 million in cash, cash equivalents and marketable securities compared to $91.4 million on December 31, 2019.

Based on our current plans, we believe we have sufficient cash to fund our operating expenses and capital requirements into 2022, beyond the next wave of expected data readouts for 1425 and 5609, while also continuing to invest in our preclinical programs and in discovery.

We recognized $3.8 million of revenue in the third quarter of 2020 compared to $0.6 million in the third quarter of 2019. This consisted of $3.5 million under our collaboration with GBT and $0.3 million under our collaboration with Incyte. All revenues recognized in the third quarter of 2019 were under our collaboration with Incyte.

R&D expenses were $17.7 million in the third quarter of 2020 compared to $15.9 million for the same period in 2019. This increase was primarily due to continued advancement of our ongoing clinical trials, our preclinical programs and employee-related expenses.

G&A expenses were $5.2 million in the third quarter of 2020 compared to $5 million for the same period in 2019. Finally, we reported net loss for the third quarter of $19.5 million or $0.43 per share compared to a net loss of $19.8 million or $0.47 per share for the same period in 2019.

With that I will turn the call over to the operator for questions. Thank you..

[Operator Instructions] Our first question comes from Kenneth Atkins of Cowen. Your line is open..

Hi, guys. Thanks for taking my questions. For the front line unfit setting in AML, what kind of durability in that setting, do you think you need to demonstrate to have a competitive profile versus the current standard of care, which, I guess, in most cases, is going to….

Thanks, Ken….

David is going to answer the question the question..

Yes, thanks for the question. So, when we look at the front line setting, we really have to look at the totality of the data, not only the duration of the response, but the response rates, the depth of the response and as well as the tolerability profile. We continue to see great opportunity for SY-1425 the frontline setting.

And when we present the data at ASH, we'll be able to provide more context. But I think the most clinically relevant benchmark for durability is in the backdrop of what we're using as an add-on. So in the context of azacitidine, we see duration of responses in the front-line setting on the order of 10 months.

And so that will probably be the most clinically relevant benchmark for the study..

Okay, thanks. That makes sense. And then for the CDK7 inhibitor study, you recently opened some cohorts to explore intermittent dosing at 4 milligrams.

Just based on the preclinical work that you've done, could you characterize how you expect the interment schedules at 4 milligrams to compare to the continuous at 3 milligrams in terms of exposure and target engagement and what you hope to achieve there?.

Sure, so, I think, it's really important to appreciate, these are early data. Actually, we find them very, very exciting at this early stage. We've been able to show that at a continuous daily dosing regimen, 3 milligrams is the maximum tolerated dose. So that's with continuous daily dosing.

And we've also achieved proof of mechanism already at an early time in the study where we see increased levels of POLR2A, which is a biomarker for CDK7 biological activity.

And the importance of that is related to the fact that we're getting POLR2A up to sustained levels at the 3-milligram dose, which correlate with regressions in preclinical models and as well with CDK7 target occupancy, as well as clinical responses in apoptosis that were demonstrated with our first CDK7 inhibitor.

So we're very excited about the position we're in. We also have data that shows intermittent dosing can deliver the types of preclinical activity as we've seen with continuous daily dosing.

And we're in the midst of evaluating various doses and dosing regimens to best optimize our position moving forward into the future, we were aiming to develop single agent and combination opportunities.

It's a little difficult to specify exactly what we're going to see at the fore in an alternate regimen versus the three in continuous daily dosing, but we want to push the dosing limits to define our MTDs in the range of doses and dosing schedules, so we're best positioned to move forward..

Got it..

Yes, maybe I will just add that I think we know that hitting the target or covering it for some period of time is important, and as – and we can measure that by the POLR2A. I think the question and what's emerging from some of our data is we may not need to have it completely covered for the full continuously and still get the same efficacy.

And so that's exciting. That allows us flexibility and also helps us with thinking about combination regimens and things that they might want to use. So I just want to add that point..

Okay thank you..

Our next question comes from Ted Tenthoff with Piper Sandler. Your line is open..

Great. Thank you very much. I just wanted to follow-up on the poster that you presented with respect to venetoclax and really kind of get into a little bit more detail. What kind of market is emerging in terms of venetoclax refractory patients? Thanks..

Ted, it's nice to hear your voice. What we know right now is that when venetoclax azacitidine has become a standard-of-care in the unfit AML setting. What we also know is that about one-third of patients never respond to ven-aza. And they are refractory, they progress quickly.

And in fact, some recent data has shown that they have an overall survival of less than a few – three months.

So I think what's very exciting to us is, obviously, one of the things we all want to understand when we have new drugs is why do some people respond and why do some not? And with some data that came out from some AML doctors earlier this year, they started to characterize sort of the phenotype of those resistant tumors.

And as David said, that based on our work, we've been able to show that patients that had the RARA biomarker are enriched for that disease phenotype that's resistant to ven-aza. And I think that is a really exciting finding because we want to be able to treat patients upfront with a therapy that's going to put them into complete remission.

And so I think this offers a really exciting opportunity to think about making a difference for those patients that aren't responding to standard-of-care..

Great. Thank you very much..

Thanks Ted..

Our next question comes from Jason Butler of JMP Securities. Your line is open..

Hey, it's Roy in for Jason. Thank for taking our question. I had a couple to start on 5609.

So following up on the EORTC results that you presented, how does that help us – help inform what we should look for mid-next year in terms of results? And then I wonder if you could go into a bit more detail about how important this new POLR2A biomarker into the program? And then I had a few on 1425? Thanks..

Yes. So we are encouraged by the early data with 5609 and have been guiding to mid next year, having more mature dose escalation data, including clinical activity data. And so we're still on track for that, for the readout mid next year.

David do you want to take the next question?.

Sure. So we think the POLR2A biomarker is actually important. POLR2A is a gene that codes for RNA polymerase 2. The activity of RNA polymerase 2 is regulated by CDK7. And we've shown with our research on CDK7, that when you inhibit CDK7, you increased the levels of POLR2A messenger RNA. So the transcripts go up in response to inhibiting the activity.

And we were able to develop assays to look at that in preclinical models. And then we translated that to an assay we could use in patients, which is really sort of a special opportunity to probe the biology in our treated patients.

The reason why it's particularly exciting is because we have learned so much from our initial work with our first-generation CDK7 inhibitor. There, it was covalent, you may recall. And we understood the target coverage we wanted over the dosing interval. We were able to actually look at the patients from that trial.

We're always trying to learn from our patients. And we could see how the target engagement correlated with the POLR2A, and we were able to show that if you could be at the POLR2A in the target engagement up to certain levels, you can see responses, which is what we did see in that trial as well as apoptosis.

And now we're getting those levels in our 5609 patients correlating with our preclinical models in 5609. So it's a very informative biomarker for helping us hone-in on the dose and the dosing schedule, and the way to optimize, how to use this drug.

And so I think we're in a good place in terms of honing in on exactly like how we want to use design, both as a singulation and in combinations. And we're setting the stage for a really robust forward-moving plan as we move forward..

Okay. Great. And then for 1425 at ASH, abstract has results through May 27.

How much more treatment time do you think we might see in the presentations themselves? And then for the relapsed refractory population, how do you think about the 20% response rate in terms – in respect to the stage of the disease and the other patient characteristics?.

Sure. So I believe the data cuts for the abstract were in the mid-May time frame. And for the presentations that will be coming up, we probably get another five months or so of information coming out of the trial.

We're going to be reporting on the completely enrolled study in 1425 plus aza in the newly diagnosed unfit, and as well in the RARA-positive relapsed/refractory AML patients. And so those updates will all be present next month..

Okay. Great. I had one last one, if I can sneak it in. So the monocyte poster, also at ASH, kind of maybe wonder about combinations with venetoclax. Can you remind us that those look preclinically at that combination is something that might be interesting? And then if so, how soon do you think you could explore that? Thanks..

Yes. So at the ASH meeting, we can provide a bit more context and detail about things like that.

But I can say we really view 1425 as something with the potential to serve as a foundation of care for all types of RARA-positive tumors, not only just in the heme malignancies but potentially in solid tumors as well, where some of our preclinical data would support that.

And in that context, yes, we've done a fair amount of work looking at various combinations with targeted agents, as well as with various cytotoxic chemotherapies. And we do think, given the tolerability profile, which is generally well tolerated, we think there's great combination potential for this drug. And it can be used in many creative ways.

We're particularly excited about that poster, and we're really looking forward to going through the details of that data with you next month..

Thank you..

Our next question comes from Zegbeh Jallah of ROTH Capital Partners. Your line is open..

Thanks for taking my question. Really excited to see the data at ASH.

As it relates to the data set, I was just wondering, can you talk a little bit about transfusion dependence and how important of end point you think that is for patients as well as clinicians?.

Sure. So if you think about what the problems are that patients have when they have leukemia, in addition to having this uncontrolled tumor circulated through their bloodstream, it fills up the bone marrow and prevents the blood from being generated. So you have low white counts, low platelets, low red cells, you have anemia.

And those low blood counts lead you to the blood bank where you have to get transfused. And it's sort of – it's a burdensome side effect of the leukemia that impacts quality of life. So when you have a complete response, your blood counts normalize, because the bone marrow is no longer diseased.

And you should be if there – it's not just a lab improvement, but a clinical benefit improvement. You should see liberation from needing to go to the blood bank for blood products. So we look at that as an important objective parameter of clinical benefit. And that's why we report out on the transfusion independence there.

We think it's a really good surrogate for clinical benefit and meaningful drug effect..

Thanks, David. I just thought that was an interesting end point as it related to venetoclax and aza. But looking forward to seeing the more mature data. And then for 5609, you mentioned using POLR2A even in patients.

So can you elaborate a little bit on that because that is a little bit different from your strategy with DHRS3, which is used for 1425?.

Yes. So, that's interesting. So what we'd like to do is we look at the various molecular pathways. We have a really strong discovery group who helps us with our science and understanding how to use our drugs effectively.

And the DHRS3, your point to for others, that was something that we evaluated as well in the 1425 program way back at the beginning, where we showed how its levels changed upon drug exposure. These are things that are important to help monitor that not only is the drug being measured in the blood, but it's having effects in the tissues.

And you can often correlate those types of effects with tumor shrinkage or disease – favorable disease responses. And so that's how come they're so helpful when we use PD-guided dosing in our clinical trials.

Not only do we look at the drug exposure, we look at the PD effects to help refine how to use the drug in terms of the dose, of the dosing schedule. So I hope that answers your question..

Yes. Yes, that was very helpful. And it's nice to see that you guys are also using us to kind of figure out whether or not the intermittent dosing will also be really effective.

And then I think the last one here for me is with Joe, with regards to the cash runway, I don't know if this is a tricky question or not, but can you talk about what's in there? Is it 5609 plus perhaps going forward both strategies for AML as well? What's in there that kind of gets you to 2022?.

Yes. Sure. Thanks for the question, Zegbeh. So as I said, $92.1 million as of the end of the quarter, cash into 2022, and that runway does incorporate part of our preclinical research funding in conjunction with the collaboration with GBT. As far as the go-forward plans, of course, there's Nancy and David said, we'll be talking more about that at ASH.

And you can expect that at that time, we'll also be talking more about the effects that may have on our go-forward runway as we always do..

Thanks. Thanks, guys. Congrats again on the [indiscernible]..

Thanks, Zegbeh..

Our next question comes from Mark Breidenbach of Oppenheimer. Your line is open..

Hey, guys, it's Matt on for Mark. Really nice-looking 1425 data in the newly diagnosed setting. And obviously, I don't want to get ahead of our SKUs here.

But what's your maybe preliminary thoughts on a regulatory path forward in that particular setting? And do you think it would likely require a randomized trial maybe compared to venetoclax plus HMA?.

Hey Matt. Yes, we are very encouraged by the data with 1425 in combination with azacitidine. And as you know, there continues to be a very large unmet medical need both in the AML setting and also in kind of related disorders to AML.

And we think there's a lot of opportunities for the 1425 combination giving such a high CR rate, deep CRs, transfusion independence, well-tolerated, especially in this elderly population. So I'd say look forward to ASH, where we can update you a little bit more on what our next steps are for the program..

Got it. And then maybe as investors are trying to benchmark what would be a good estimate. For how venetoclax plus HMA would do in the newly diagnosed RARA positive setting, as you mentioned, RARA positivity seems to be correlated with venetoclax resistant. So they got about a 56% CR-CRi rate in the VL trial.

Do you think it would be appreciably lower in this patient population that you're going for?.

I think – I mean the data that – based on the fact that we're seeing this disease phenotype in the RARA-positive patients that sort of correlate with ven resistance would suggest that to be the case. And I would just say stay tuned for, sort of, the overall ASH presentation, we can provide much more details on that.

But I think it's – what's exciting is that we've identified that this resistant phenotype is enriched in the population that were in the RARA-positive patients..

Cool. Thanks for taking the question..

[Operator Instructions] Our next question comes from Matthew Cross with Alliance Global. Your line is open..

Hi. Congrats on the recent CDK7 data and looking forward to ASH just around the bend. Had a couple of questions around 1425. Dave, again, I won't try to get too ahead of your ASH presentation here and stay high level.

But in the same vein as what it sounds like you'll be presenting at ASH regarding RARA positivity, conveying resistance to venetoclax? On the flip side, have you seen anything preclinically or clinically that would suggest physiologic changes brought upon by prior therapy, may convey any differential sensitivity to 1425 as we get a better sense of the activity in the relapsed/refractory population?.

So that's a good question. I think, I can refer back to our most recent presentation at the ESH meeting at the end of last year. We see activity across a range of cytogenetic risks and various mutations, both poor risk intervention and good risk type mutations.

So at the outset, I would say that we've not anticipated that there are those types of influences on the response. We do see high complete response rate, early time to response, and that's all been now put into our abstract.

So I think we could get into a bit more detail at the upcoming ASH meeting to provide more context?.

Yes. Absolutely fair enough. And looking forward to discussing that a later date. I guess the other thing I was curious about would be maybe switching over to the newly diagnosed cohort.

At what point do you think it's pertinent to stop testing or enrolling in these RARA-negative patients? I guess, what is kind of the confirmation point at which you can say, this is the right biomarker, and ethically, maybe patients who are RARA positive should be the focus.

Is there a realistic use case in your view for 1425 based on what you're seeing so far, to be used in RARA negative cases as well in certain instances?.

That is a good question. We have strong preclinical data that suggests that 1425 was going to work in the RARA positive versus a negative, but it's always important to test that in the clinic.

And so we tested RARA-negative patient population, which we presented some initial data last year and now update data at ASH, which really goes to show that the RARA biomarker is enriching for patients most likely to respond, where we saw a much higher CR rate than the RARA-negative population.

And so I think that gives us a lot of confidence that we are – that the RARA-positive patients are the ones that are benefiting from the drug and not the RARA negative. So while we haven't talked specifically about sort of plans going forward, when we started the relapsed/refractory cohort that's only in the RARA-positive patient population.

So hopefully, that helps you answer that..

Yes. Absolutely. Certainly makes sense given the direction of the relapsed refractory. And glad to see this all – the thesis be fully tested out. Just have to consider given that both rates don't look terrible either way. But thank you for the clarity. Appreciate it and looking forward to the presentations next month..

Great. Thank you..

There are no further questions. I'd like to turn the call back over to Nancy Simonian for any closing remarks..

Thank you, operator. In closing, I want to thank you all for joining us today, especially with everything going on in our country the last few days, and for your continued interest in Syros.

We look forward to updating you as we continue to advance toward our vision of building a fully-integrated biopharmaceutical company with a portfolio of medicines that provide a profound benefit for patients. Thank you..

Ladies and gentlemen, this does conclude the conference. You may now disconnect. Everyone, have a great day..