Roland: Good afternoon, everyone. We're excited to continue our 44th annual J.P. Morgan Healthcare Conference. My name is Roland, and I'm an associate on the Healthcare Investment Banking team here at J.P. Morgan. Today, it's my pleasure to introduce Novation Bio and its founder, president, and CEO, David Hung. We'll have time for Q&A at the end. We'll be joined by Philippe Sauvage, CFO, and J.R. DeVita, Executive Director, Corporate Development and Investor Relations. So with that, please join me and welcome Dr. David Hung.
David Hung: Thanks. Thank you all for coming. So Nuvation Bio is a commercial stage biotechnology company. We have several products in late stage. Ibtrozi, or talotretinib, is our commercial asset. It was approved in June, and it is a next generation, and we believe best in class, ROS1 inhibitor for treating ROS1 positive non-small cell lung cancer. Safucitinib is another potentially best-in-class mutant IDH1 inhibitor for the treatment of both high-grade and low-grade gliomas, which is in a pivotal study. We have NMV868, which is a BD2-selective BET inhibitor that's finished Phase I studies. And we have a novel drug-drug conjugate preclinical program, which is an interesting take on ADCs without the A. These are two small molecules conjugated together to provide targeted therapy to cancers. Our cash balance is currently about $589 million after announcing a deal with Azai yesterday, and we expect a path to profitability without any further funding. If you can look at our overall profile here, you can see that if Trozy is commercial, with commercial partners, Azai, InnoVent, and Nippon Kayaku, and the other programs are listed below. We announced yesterday a deal with ASI for Europe and other selected territories. In that deal, we received an upfront payment of $60 million, and we'll receive another $30 million near-term milestone upon approval in Europe. And we will receive royalties into the high double digits on teletrek and net sales in those territories. So our first program, Ibtrosi, or Talotreknib, was actually acquired when we bought AntHeart Therapeutics in April of last year. We have approval in the line agnostic setting in the US, Japan, and China for the treatment of advanced RAS1-positive non-small cell lung cancer. If you look at our sales, we've had our second full quarter of sales. If you look at the sales of ROS1 TKIs over the last four years, in the red box has been the fourth quarter sales. So during Thanksgiving, holidays, and Christmas, New Year, you can see that, in general, fourth quarter sales have been the weakest of the quarters for these TKIs. If you look at our second full quarter that we just announced, fourth quarter sales, we went from 204 new patient starts in the third quarter to 216 new patient starts in the fourth quarter. So an increase of 6% quarter over quarter in a holiday quarter that traditionally is weaker than other quarters. What's notable is that our 432 new patients start since launch reflects a 6x faster launch than Octiro and other TKIs. And I can tell you that as of today, Eptrosia in its second quarter is already the market leader in ROS1 TKIs and the preferred TKI for advanced ROS1 positive non-small cell lung cancer. We've had multiple repeat prescribers across the U.S., We've had scripts written in 100% of our 47 sales territories. And on the coverage front, we have 90% of lives covered to label as of the second quarter. If you look at the landscape of other approved ROS1 TKIs, there are three. The first-generation TKIs, intractative and chrysotinib, are in the middle two columns. And if you look at the response rate and the intracranial response rate, which are some of the two most important metrics, and as well as the duration of response, you can see that first-generation TKIs have a response rate of about 70%, a median PFS of about a year and a half, and really don't have much intracranial activity. Crizotinib does not cross the blood-brain barrier. And the reason that's important is because Rospon lung cancer is a cancer that starts 36% of the time in the brain, and another 50% is the first site of disease progression in the brain. Reprotrectinib is a second generation RAS1 TKI, and you can see that the response rate has improved from around 70% to 79%, but more importantly, the median PFS has doubled from about a year and a half to three years. If you look at Ibtrozi's response rate in our publication in JCO from a June 2024 data cutoff, our response rate was 89%. And if you look at the PFS, that was about 46 months. But more importantly, for the submission to FDA for our label, we actually use a data, a later data cutoff, and our most recent data cutoff of August now shows that median duration of response out to 50 months, which is... It's unusual among oncology agents. If you look at the history of oncology, there are actually no drugs in any cancer that have been able to match an 89% response rate and 50-month DOR. So if you look at some of the best drugs here we know in oncology, sulprocatinib, the great Rett inhibitor, 84% response rate but 22-month PFS, If you look at Tegressa, osomertin, the biggest drug in lung cancer, 77% response rate, but only a 19-month PFS. Lorlatinib, a great PFS, five-year PFS in the crown study, one of the longest ever seen, but the response rate is 76%. So three of four patients respond to Lorlatinib. With talotrectinib or Ibtrozi, nine of ten patients respond. even expanding at medivation, as good a drug as that was, 59% response rate, 20-month PFS. So our 89% response rate and 50-month duration of response is really elite among even a good class of oncology agents. If you look at the second line setting, our response rate and especially intracranial response rate have not been matched. So in the second line setting, our response rate in the JCO publication was 56% with a median duration of response of 17 months and intracranial response rate of 66%. This is particularly important, as I said, because ROS1 lung cancer is a disease that starts in the brain 36% of the time and will progress in the brain another 50% of the time as the first sign of disease progression. If you look at the adverse events of other TKIs that have been approved, even though Reprotrectinib has had significantly improved response rate and duration of response compared to first-generation agents, if you look at the dizziness in the right side of this slide and the farthest left bar on the right side of the graph, 65% dizziness rate. has been difficult for patients. And if you look at the discontinuation rate of Repetrectinib, given that dizziness rate, the discontinuation rate at five months is about 50%. Entrectinib in the next column at 38% still has significant dizziness, but if you look at Crizotinib next to that at 20%, Crizotinib does not get into the brain and its dizziness rate is 20%. The reason I point out that 20% number is if you look at Ibtrosi's dizziness rate, if you look at the far left column there, the fourth line down, our dizziness rate is 22%. That's 2% different from crizotinib, a drug that doesn't even get into the brain. So just speaking to how well tolerated this drug is from a CNS standpoint. And if you look at the dizziness that we do have, 90% of that dizziness is grade one and lasts about three days. So very, very transient. If you look at our discontinuation rate of 6.5%, that is the lowest of the approved ROS1 TKIs. And as you'll see on the next slide, If you look at the six most common adverse events of Ibtrozi, they're listed in descending order. So increased liver function test, increased AST and ALT are the most common adverse events. But these are paper adverse events. They're not clinical adverse events. They're generally invisible to patients. The four most common clinical adverse events are, in order, diarrhea, nausea, vomiting, and dizziness. But if you look at the middle two columns in the yellow, those are the dose interruption and dose reduction rates of Ibtrozi in the six most common events. And you can see they're all in the single digits. Perhaps most importantly, on the far right, if you look at the treatment discontinuation rate, out of 337 patients in our database, only one patient discontinued drug due to any of these six most common adverse events. And so this is a reason that Ibtrozi has, part of the reason that our DOR, our duration of response is 50 months, is not only does the drug work, but it's so well tolerated that this discontinuation rate is quite low. So that's an important consideration. And in fact, the fact that we are now in an adjuvant study and the only Roswell inhibitor in an adjuvant study, which means right after surgery, so way far upstream, In order to have a drug developed in the adjuvant space, you have to be particularly well-tolerated because those patients are asymptomatic and they're not going to take a drug that's hard to take. So the fact that we're the only drug being developed in the adjuvant space is further testament to how well-tolerated this drug is. Why is this drug so well tolerated? Because if you look at repotractinib, which I mentioned, a 65% dizziness rate, if you look at TREC-B, which is a receptor that's an oncogene, it plays actually an important role in brain metastasis. But if you look at the affinity of repotractinib on binding for ROS1 versus TREC-B, it's 1.1 nanomolar against ROS1, it's 1.2 nanomolar against TREC-B, it's identical. So the selectivity ratio is one. So there's really no selectivity, which means that in order to inhibit ROS1 very potently, they're going to inhibit TREC-B with the equal amount of potency. And that causes prohibitive toxicity, which is why the discontinuation rate of Octiro has been 50% in five months. If you look at Ibtrozi, in the two columns above that, You can see that our affinity for ROS1 is about five to 10 times more avid than reprotrectinib. But our TREC-B activity is about 11 to 20 times lower than its ROS1 activity. What that means is that we can dose Ibtrozi high enough to really inhibit ROS1 without prohibitively inhibiting TREC-B. And as a result, you saw our dizziness rate is 2% different than crizotinib, which doesn't even get into the brain. If you look at the bottom rows, if you look at function and look at the selectivity of Iptrosi compared to RepoTrekNib, we are 19 times more selective on function, functional inhibition of ROS1 than TREKB. So very consistent with the binding affinity difference and selectivity we see above that. If you look at the market opportunity in the United States, there are somewhere between 2,000 to 4,000 patients. We're going to take the middle point of that range, 3,000 patients by current DNA testing. There's about 50% more than that in Europe and about half of that in Japan. So if we look at 3,000 patients a year in the United States, which is the current incidence rate by DNA testing, if we were just to multiply that times the current drug price, that would be a theoretical market maximum of about a billion dollars a year. But remember that our duration of response is now over four years. So what that means is that everyone who gets treated in year one in the first line setting will make it through year two, year three, year four, into year five. Everybody who gets diagnosed in year two will make it through year three, year four, year five, year six, and so on and so forth. So you get revenue stacking so that by the fourth year in the first line setting, that would equate to, if we only use 46 months, which is the original publication for PFS, if we would only use that, that's still 3.8 billion as a market, theoretical market opportunity with revenue stacking in the first line space. And that's based on DNA testing. The reason I mention that is because RNA testing is now becoming the new standard. So RNA testing was approved about a year ago. It's now made it into the NCCN guidelines. And even though it's still not widely used, it's increasing every day. And RNA detects about 30% more erosive infusions than DNA, which would make 3,000 patients a year go to about 4,000 patients a year. So that market opportunity could approach 5 billion and even exceed it. if RNA testing becomes the standard of care, which we anticipate it will be. An important tailwind for us is that last year, the NCCN guidelines changed, whereas IO chemo used to be the standard of care and was still used in ROS1-positive lung cancer. On the left, in the red box, if you had a ROS1 fusion, NCCN recommended two choices. You could complete your IO chemo, or you could stop it and go to a ROS1 agent. Given the new data of ROS1 agents compared to IO chemo, which average BFS is 6 to 12 months, there's really no comparison now in the basis of that. On the right in the green box, as of last year, the NCACN now is contraindicating IO for the treatment of ROS1 lung cancer. So now if you have a ROS1 fusion and you're on IO, you can see on the right in the green box, the recommendation is now to stop your IO chemo and now give a ROS1 agent, of which Ibtrozi is a preferred agent. So that's a very important and new development that just happened in the last year. If you look at the biggest drug in lung cancer, which is Tegresso, at the bottom left, you can see that the benefits of Tegresso over its nearest competitor are about nine months of progression-free survival, 19 versus 10, and eight points of response rate, 77 versus 69. If you look at Ibtrozi's benefit over its nearest competitors, given the fact that Repetrectum now is not used much anymore, and most scripts of remaining TKIs that are used, Crizotinib and Intrectinib would be, you know, an 18-month PFS and a 70% response rate. We're talking about a benefit over those agents, roughly, that it more than doubled the benefit of Osimertinib over Tarceva. And in spite of a lesser benefit over its competitors, if you look at Osa-Mertinburg, Tigrisso's launch, by their third year, they had 100% market share. So given the fact that our benefits over our nearest competitors exceed those of Tigrisso's over its nearest competitors, we would anticipate in a similar time frame that we would expect to have market share that would include the vast majority of this indication. Our second program is sapucitinib. Sapucitinib is a mutant IDH1 inhibitor. Mutant IDH1 is a gene that drives the growth of glioma, but does other things that are interesting. It also, tumors overexpress it to create an immune privileged environment that evades immune detection. If you look at the glioma market, it's about 2,500 new cases a year divided roughly on the right half and half between low grade and high grade. Now what's particularly notable about these gliomas though is that the low grade gliomas live 10 to 15 plus years And even the high-grade gliomas live three to seven plus years. And now we're talking about even high-grade disease living up to double the duration of Ibtrozi's four-year DOR. So because of these extremely long survival seen in these indications, these are significant opportunities commercially because of revenue stacking, as I explained earlier. The only drug approved in IDH1 mutant glioma is voracitinib, the Cervier drug. Cervier is a private company, so it's hard to look at Cervier sales, but Royalty Pharma paid Agios $905 million in 24 for a 15% U.S. royalty, so based on royalties on voracitinib, we can glean what the sales of voracitinib are. And if you look at the very far right of the slide, in the last quarter, voracitinib generated $223 million in revenue. So it's already, in its first year of launch, a billion-dollar drug. So that just speaks to how large an opportunity glioma is. And the other point I would like to make is if you look at the long survival of these patients, even though the incidence is 2,500 a year, if you're talking about a 10 to 15 year survival, you can imagine the prevalence is going to be a long more than that because they accumulate over time. So when you look at voracitinib's launch, the reason they're at a billion-dollar run rate is not because of 2,500 new patients a year. It's because the prevalence pool in both high-grade and low-grade glioma is so substantial. If you look at voracitinib's data that led to their approval, on the right, you can see that the response rate in low-grade glioma was 11%. In high-grade glioma, the response was 0%. If you look at the left of the slide, at the one-year mark, they had 77% of patients still on drug, which means they had 23% progression. And at the two-year mark, they had 59% of patients still on study, which means they had 41% progression. So if you look at the number of progressors on voracitinib, just to reiterate it, 23% at one year, 41% progressors at two years. If you look at safucitinib that we just published this data in neuro-oncology recently, you can see in the left that at one year, instead of 23% progression, we have 4% progression. At two years, instead of 41% progression, we have 12% progression. If you look at the right side of the slide, instead of 11% response rate in low-grade glioma, we're at 44%. And instead of 0% response rate in high-grade glioma, we're at 17%. But notably of that 17%, a third of those are complete responses. What that means in oncology is that tumor has disappeared. We have a glioblastoma, the worst of the worst gliomas, that's now been in a CR for three and a half years. And also a grade three oligodendrolioma that's been in a CR for two years. We have now initiated two studies, one pivotal study. It will enroll 300 patients, half on sapfusidinib, half on placebo. And we will enroll into the study not only high-grade gliomas, but also high-risk, low-grade gliomas. So whereas for us, it was only approved in low-risk, low-grade gliomas. portion of that pie on the left, which was, you know, about half of gliomas, they were there, voracetamib was approved in low-risk, low-grade gliomas, we're doing a pivotal study in not only high-grade glioma, but high-risk, low-grade gliomas, so more than half of the glioma pie. The primary endpoint of the study is progression-free survival, and we anticipate this study reading out in 2029 at the latest. However, We are just starting another study. This is a new study that we have not previously talked about. This is going to be a study in grade three oligo-dendroglioma. So this is the lower risk side of the high risk subset of glioma. What's important about this glioma population is they also can live a very long time. But because you can't give these patients radiation therapy or chemo for 15 years, they live 15 years, they don't want to take those therapies. And after surgery, if they have residual disease, or recurrent disease, you need to give them therapy that is better tolerated. So we are now studying saflucentinib in this population. Unlike the previous study, these patients will be required to have measurable disease, and because they have measurable disease, response rate, not PFS, will be the primary endpoint of the study. We're going to enroll 40 patients. We hope to get the majority of that by this year. And we would anticipate start seeing response rates reading out this year and all of them hopefully by next year. So we will actually be able to see how well sapfucitinib works in this population starting this year and into next. And we believe that if we show a significant response in this population where nothing has been approved in and nothing else works, We believe that that halo effect will extend across the glioma space, and we think it would be a very positive data set to take into our pivotal study in the previous trial that I talked about. So we will have ORR data starting later this year and into 2027. If you look at the AE profile of South Lucinda, what's most interesting about it is in the green, five of our top seven adverse events are immune type. reaction. So alopecia like alopecia areata, arthralgia like rheumatoid arthritis, skin hyperpigmentation like vitiligo, those are unusual. What's notable is that you don't see those with voracitinib. So we believe that part of safucitinib's robust activity may at least in part be immune. And the reason we also say that is because if you look at our responses, In many cases, it takes six to 12 months to see those responses, a lot like IO. And when we do get responses, some of them last for years. I mentioned a GBM that's been in a CR for three and a half years. A grade three oligo that's been in a CR for two years. That kind of slow onset of action and durability are reminiscent of many IO agents. So we think that this AE profile is unique and interesting and potentially tied into the efficacy. If you look at the tolerability of this drug, it's excellent. So only 11% of patients have treatment emergent adverse events that led to treatment discontinuation, and only two of those were drug-related. So if you look at drug-related TEAs causing discontinuation, the incidence was 8%. a pretty well-tolerated drug. So that's particularly important because we're talking about a disease where you're going to be treating patients for 10 to 15 years. You want it to be well-tolerated. And like telotrectinib, like Ibtrozi, our discontinuation rates appear to be excellent. Our BET inhibitor is the most BD2-selective BET inhibitor in development. We finished phase one. Unlike Pelabrasib, which has a selectivity of five to six-fold over BD1, ours is 1,500-fold. So this is a program that's now finished phase one, and we're trying to decide what to do with that program. And I mentioned the DDC platform. You're all familiar with ADCs on the left where you conjugate a small molecule to an antibody which targets it to a cancer cell epitope. If you look at the right, we've tried to do the same thing with two small molecules, one a targeting agent, one a warhead. So if you look at what we've done conceptually on this slide, you're taking drug X against target X and drug Y against target Y and finding a way to fuse them while we maintain their active sites to make a bispecific small molecule. And we've done that and we are We are still exploring how to optimize those further before we take another into clinical trials. So if you look at where we stand today, pro forma cash of 590 million, we'll get another 30 million, When we get approval in Europe, which will take our cash up to about $620 million, far more than we need to get to profitability. Ibtrozi is doing well. It's approved now in U.S., Japan, and China. We are already at six times the reproductive launch. If you look at just our first two quarters, we anticipate growing significantly. And as I told you, the market opportunity that we see, especially with the A move to RNA testing should approach $5 billion or so a year. Salfosutinib is in pivotal studies, two different studies, and we think that that's a very interesting molecule given our PFS and response rate compared to farcitinib. And we have also our BD2 selective bet inhibitor and our DDC platform. And with that, I'm happy to take any questions. And we'll start with the audience.
Roland: Maybe I'll start off with the first question. David, you mentioned that your performance cash balance is at 589 and then potentially going up to 620. Where do you plan to deploy this capital?
David Hung: Yeah, so our OPEX is pretty stable at this point. After we decided to not advance 1511 further in the clinic, so all those clinical trials that were in the budget came out of the budget. And teletractive, although it hasn't wound down all the studies so far because the drug is working so long, we still have to continue them. We don't think that's going to change a lot. So we're going to have a fair amount of cash to look at other opportunities. We were really happy with the way the Anhar acquisition played out. We paid $260 million in cash, and based on that, we received $150 million from Sagard Royalty Partners for 5% royalty, so that values SAFU in the United States at about $3 billion. And we also just, you know, raised another $60 million right now from ASI with a $30 million to come. And if you look at the actual value of the China partnerships and Japan partnerships, the upfront payment is about $120 million for all territories. And a total, you know, milestones and other payments to us is about $520 million. So far, you know, SAFU, I'm sorry, Teletractive has generated $120 million up front and about a $520 million in milestones for us. So we'd love to do another deal like that. And so there are a lot of opportunities out there. We're looking at a lot of late-stage assets or commercial assets, and when we find something that we think would be a good fit like Anhart was for us, we would be very enthusiastic about moving forward on that.
Roland: I can continue with another one. Can you share what your priorities are for 2026? Anything that you're thinking of?
David Hung: I think our most important priority is to just continue the Ibtrozi launch. That's gone really well. We're really excited about it. We are already the market leader, but we think that there's still a lot of work to be done left. If you look at... NGS testing, while it's near 100% in academic centers, it's not that yet in the community. We think there's further room to grow in the community by increasing awareness of NGS. Also, one of the perhaps weaknesses of our Anaheart acquisition is that Anaheart did not have a large U.S. presence. We're getting more of that every day, and now with two quarters under our belt, we have many repeat prescribers from U.S. physicians, and that's going to accelerate the sales up to Iptrosi. So we're all over that and want to continue to see that trajectory improve. And we are also really excited about Sapucinda. This is a And we think this is a game-changing drug. We have not seen glioma data like this before with any agent. And we would like to get that developed as quickly as possible. And we're going to have some readouts on just the response rate of safrasitinib in a glioma in grade 3 oligos for which there's no therapy. So that's very exciting. And we'll be also enrolling the... the pivotal study as well in the high-grade glioma and the high-risk, low-grade glioma. But just to give you an example of how committed we are to this development path, there are right now about 400 new grade three oligos in the US alone every year, plus a huge prevalence pool because those patients live 10 to 15 years. the prevalence pool is probably many, many thousands of patients. And we've already initiated 31 sites for this trial. So to get our 40-patient target, we need 1.3 patients per site in a year. So we are really trying to get this enrolled quickly. We think with 31 sites, we hope to get that entire trial enrolled this year if possible and have readouts on OR starting this year and certainly finished by 2027.
Roland: If we don't have any questions from the audience, I think this concludes the session, and thank you very much. We wish you enjoy the rest of the conference, and thank you for the new mission pilot team.
David Hung: Thank you. Thank you very much.
