Yahoo Finance Geron Corporation (NASDAQ:GERN) Q1 2024 Earnings Call Transcript
Geron Corporation (NASDAQ:GERN) Q1 2024 Earnings Call Transcript May 2, 2024
Geron Corporation beats earnings expectations. Reported EPS is $-0.09178, expectations were $-0.1. Geron Corporation isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Thank you for standing by. My name is Jael and I will be your conference operator today. At this time I would like to welcome everyone to the Geron Q1 2024 Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks there will be a question-and-answer session. [Operator Instructions] I would now like to turn the conference over to Aron Feingold. You may begin.
Aron Feingold: Good morning, everyone. Welcome to the Geron Corporation first quarter 2024 earnings conference call. I am Aron Feingold, Geron's Vice President of Investor Relations and Corporate Communications. I'm joined today by several members of Geron's management team. Dr. John Scarlett, Chairman and Chief Executive Officer. Anil Kapur, Executive Vice President of Corporate Strategy and Chief Commercial Officer. Dr. Faye Seller, Executive Vice President and Chief Medical Officer. Michelle Robertson, Executive Vice President and Chief Financial Officer and Dr. Andrew Grethlein, Executive Vice President and Chief Operating Officer. Before we begin please note that during the course of this presentation and question-and-answer session we will be making forward-looking statements regarding future events, performance, plans, expectations, and other projections including those relating to the therapeutic potential and potential regulatory approval of Imetelstat, anticipated clinical and commercial events and related timelines, the sufficiency of Geron's financial resources, and other statements that are not historical fact.
Actual events or results could differ materially. Therefore I refer you to the discussion under the heading risk factors in Geron's most recent periodic report filed with the SEC which identifies important factors that could cause actual results to differ materially from those contained in the forward-looking statement. Geron undertakes no duty or obligation to update our forward-looking statement. With that I'll turn the call over to Chip. Chip?
John Scarlett: Thanks Aron. Good morning everyone. Thanks for joining us. We're poised for a successful U.S. launch of Imetelstat for the treatment of transfusion-dependent anemia in patients with lower risk MDS. If approved we're deeply excited for the opportunity to bring patients what we believe is an important and differentiated medicine. With our PDUFA date on June 16th, we continue to work closely with the FDA as they complete the review of our new drug application. As part of the MDA review process on March 14, the FDA's Oncology Drugs Advisory Committee or ODAC voted 12 to 2 in favor of the clinical benefit risk profile with Imetelstat for its intended indication in lower risk MDS. The resounding support for Imetelstatreflected in the ODAC vote was also echoed in comments from the lower risk MDS community during the public forum.
Hematologists and patients alike spoke out about the burden of transfusion-dependent anemia in this disease and the need for new treatments particularly for patients with difficult to treat subtypes such as high transfusion burden and RS negative patients. Imetelstat is uniquely positioned to address these underserved transfusion-dependent MDS patient populations. We're in the final stages of commercial readiness execution which is included bringing on a sales force in April 2024. We're also engaging in marketing, commercial access payer and reimbursement preparatory efforts just as we are completing the build out of our enterprise capabilities and systems to support our transition to commercial stage company. In short, we're building on our momentum acting with urgency and fully confident in our readiness for U.S. launch on potential approval.
We're also financially well-resourced to support the planned U.S. commercial launch with approximately $465 million on the balance sheet as of March 31 of this year. On the heels of the highly positive ODAC outcome, we raised approximately $141 million in net proceeds from an underwritten public offering of common stock and a pre-funded warranty. This offering included participation from RA Capital, Fairmont, ObriMed, Farallon, Adage, Boxer, Vivo, Deep Track and multiple large investment management firms in addition to other new and existing investors. From an EU perspective we also have an MAA or Marketing Authorization Application under review in this indication. If Imetelstat is approved by the European Commission, we expect a commercial launch in Europe would occur in 2025.
We're continuing to evaluate our strategic options for European commercialization including self-commercialization or partnering and expect to provide an update later this year. I'd like to turn briefly to our ongoing clinical development efforts in JACI relapsed and refractory MF patients. As many of you recall Impact MF is the only Phase 3 MF study with overall survival as the primary endpoint. Last month, the Data Monitoring Committee evaluated unblinded data and recommended the clinical trial continue. In addition the company reviewed enrollment rates and blinded death rates which are lower than anticipated based on the initial planning assumptions. Accordingly, we're updating our guidance to extend the timelines by half a year with the interim analysis now expected in early 2026 and the final analysis expected in early 2027.
Even the trial investigators remain excited about this study and the potential of a treatment that could improve survival for these patients who currently have very few treatment options and dismal survival rates. Faye will provide more color on this trial later in this call. Before I turn the call over to the team, I'd like to take a moment to reflect on how inspired I've been by all of our Geron people. Their passion for bringing our medicine to patients is palpable and drives our culture. From our longest tenured colleagues who worked on the Imetelstat IMD to our sales force that joined us just a few weeks ago there is a deeply shared sense of purpose that each one of us can uniquely contribute to improving the lives of patients with hematologic malignancies.
I believe that this unity around our mission drives our urgency and collaboration and it's a critical factor in transforming our fast-growing organization into a successful commercial company. With that I'm going to turn the call over to Anil for commercial updates. Anil?
Anil Kapur: Thanks, Chip, and good morning to everyone on the call. We believe that we are positioned very well for commercial value creation and are well-prepared to execute a successful U.S. launch upon potential approval. As Chip mentioned in April, we completed the build-out of our full commercial organization with the hiring of our sales force, which is being now integrated and trained so that they will be prepared to be deployed in the field upon potential approval. I've had the privilege of getting to know this team really well and I'm deeply impressed by their caliber, experience, and commitment. We also have commercial supply arrangements in place and have finalized our specialty distribution network and third-party logistics.
From a market perspective, we have worked to identify the concentrated low-risk MDS prescriber base and our patient access and affordability solutions are on target for implementation at launch. To support our launch preparation and commercial strategy, we have collected extensive market insights which suggest that Imetelstat is highly differentiated in this transfusion-dependent low-risk MDS market. Our research has shown that medical and payer stakeholders are dissatisfied with available options in the low-risk MDS space which we believe creates an opportunity for Imetelstat. Additionally they express enthusiasm for the totality of clinical benefits deemed with Imetelstat including durable red blood cell transfusion independence, hemoglobin increases, and reduction in transfusion burden balanced with a generally well-characterized and manageable safety profile.
Lastly from a patent and regulatory exclusivity perspective in the U.S. as shown at the end of the slide deck we are using today, we have orphan drug exclusivity through first half 2031 for MDS. Our method of use patent for MDS and MF expires in March 2033, but if the patent term extension is applied to this used patent, we expect exclusivity would be extended to 2037 and would apply to all users covered by the patent including both MDS and MF. We believe Imetelstat is uniquely positioned to address unmet needs in transfusion-dependent low-risk MDS as captured on this slide which depicts the treatment landscape as well as a simplified schematic reflecting the current NCCN guidelines for MDS. As you may be aware, the NCCN guidelines along with published results from the randomized trials remain among the most important factors that influence clinical and pair pathways and significantly inform prescribing behavior.
The NCCN guidelines recommend ESAs as the preferred treatment option for the larger segment of frontline RS negative patients. It's important to remember that many of these patients will show a loss of response to ASA treatment in the frontline setting in approximately 18 to 24 months. There also continues to be limited treatment options for patients with serum eco levels greater than 500 ml per mu, and participation in clinical trials for ESA ineligible RS negative patients is encouraged by NCCN guidelines. From our perspective these guidelines reflect a lack of effective treatment options in particular for those patients who are ESA ineligible, high transfusion burden patients and for RS negative lower risk MDS patients who constitute approximately 75% of the market.
This is a need, we believe Imetelstat can powerfully address as a potentially durable treatment that can be used broadly across MDS subtypes. This next slide summarizes our latest market research from 2024 of 50 community and academic U.S. hematologists when surveyed about the product profile of hematologist. When surveyed about the product profile of Imetelstat and what factors may drive treatment decisions. It additionally reflects fair priorities in the low-risk MDS space. Our findings show that these physicians note that achievement of RBCTI and rise in hemoglobin are two key factors that drive their decision-making. Further they point to the greater than 24-week TI and patient reported outcome data from IMerge as essential considerations.
These physicians view Imetelstat as a likely standard of care across the relapsed refractory RS negative patient population expressing enthusiasm for the significant efficacy improvement in a population with limited current treatments. These physicians also note transfusion burden has strong impact on treatment decisions and believe Imetelstat is a compelling option for patients with high transfusion burden due to differentiated data in this patient population. The Imetelstat profile also resonates with fair priorities and they recognize the unmet need in the transfusion dependent low-risk MDS space. They express that NCCN guidelines inclusion and peer-reviewed publications are seen as important evidence for their consideration. Inclusion in the NCCN guidelines requires an FDA label as well as the publication of the pivotal data which is already available in the line set.
Once potential FDA approval is secured, our teams stand ready to engage with NCCN to begin the process of updating the guidelines. It's important to note that given the elderly patient population with transfusion dependent low-risk MDS, the majority of U.S. patients are expected to be treated under the Medicare Part B setting. We are confident patients will have broad access to Imetelstat. We expect to see Imetelstat uptake across ESA ineligible, ESA failed, RS negative, and RS positive high transfusion burden patients. Based on our latest 2024 market research of 50 U.S.-based practicing hematologists across both community and academic settings, on the left-hand side of the slide, you can see that our market research suggests meaningful Imetelstat use in frontline ESA ineligible patients, especially those who are RS negative.
The right-hand side of the slide shows the estimated second-line population, approximately 90% of which are expected to be ESA or luspatercept experienced. Our market research suggests a broad use of Imetelstat across the second line, regardless of frontline therapy, particularly for RS negative patients. As you can see on the figures on the right, which are further segmented for RS positive and RS negative patients within these subgroups. Our findings confirm the significant unmet need across the low-risk MDS patient population, and we strongly believe that Imetelstat, if approved, can play a meaningful role in the treatment paradigm of transfusion-dependent low-risk MDS moving forward. We believe we are well-positioned to capitalize on Imetelstat opportunity in transfusion-dependent low-risk MDS by building on the unique product profile and executing on the launch critical success factors that are driving our commercial plan.
From a prescriber's perspective, we have a few important goals that prescribers embrace the totality of clinical benefit achievable with Imetelstat and understand the efficacy profiles across MDS subgroups, including RS negative and high-transfusion burden patients. It's also critical that we provide education and support for physicians on the Imetelstat safety profile and help them to contextualize and manage cytopenias so they can offer an optimized patient experience and duration of therapy. This support will also help prescribers have a good first experience with Imetelstat, which is another important goal. From a patient access perspective, as reflected by our research, the need for new treatment options and the high unmet need populations that Imetelstat can address are expected to be important considerations to drive access and reimbursement.
We are honored and privileged to have the opportunity to launch a medicine that could have such significant meaning for transfusion-dependent low-risk MDS patients and their families. And we are deeply energized to embark on this journey. With that, I will turn the call over to Faye for a medical and clinical update. Faye?
Faye Feller: Thanks, Anil, and thanks to everyone for joining our call today. As Chip mentioned, on March 14, the FDA Oncologic Drugs Advisory Committee voted 12 to 2 in favor of the clinical benefit-risk profile of the Imetelstat in transfusion-dependent lower-risk MDS indication proposed in our NDA. The ODAC considers the results from our Phase 3 IMerge trial as well as the unmet needs of and limited available treatment options for patients with this cancer. Needless to say, we are very pleased with the committee's decision to recognize the positive clinical benefit-risk profile of Imetelstat for the treatment of transfusion-dependent anemia in adult patients with lower-risk MDS. As Chip mentioned, the public forum provided a critical opportunity for the ODAC to hear from members of the lower-risk MDS community, including hematologists, patient advocates, and patients.
Throughout these testimonies, there were several central themes that deeply resonated with me as a hematologist experienced in treating lower-risk MDS patients. These sentiments also echo what we hear in our market research and at medical conferences. The profoundly negative impact of anemia and transfusion-dependence on the quality of life for both patients and their families was strikingly evident. These patients are chronically fatigued and struggle to keep up with their daily activities, commonly resulting in psychosocial and emotional burden. Lower-risk MDS is a progressive disease, and by the time the patients progress to transfusion-dependence, they do not have many treatment options. In fact, hematologists at the ODAC pointed out that they usually end up cycling through most or all of their options, making an additional treatment in their armamentarium potentially practice-changing.
There was also significant discussion around the deep meaningfulness of RBC transfusion-independence for these patients, one of whom testified at the ODAC that she believed transfusion-independence would give us more time to have a better quality of life. A nurse commented in a public hearing that time not spent in an infusion chair is time spent living, really living. From a clinical perspective, while transfusions can provide short-term relief, they can also cause long-term consequences. Frequent red blood cell transfusions can lead to [alkalinization] [ ph] and difficulty in identifying a matched donor to support the continuous transfusion need. Over time, patients can develop end-organ dysfunction due to iron overload. This is in addition to the psychosocial and emotional toll that transfusion-dependence can take on patients.
The hematology and patient communities expressed that beyond durable RBCTI, the hemoglobin increases and reduction in transfusion burden observed with the Imetelstat are important indicators of clinical benefit. Lastly, several hematologists spoke out about their comfort level managing cytopenias, given their familiarity with these hematologic toxicities as a side effect of many medicines regularly used in clinical practice. This reinforces our belief that, with the proper context and education, these cytopenias should be able to be well-managed by hematologists in a real-world setting. Overall, hematologists, patient advocates, and patients express support for new treatment options in transfusion-dependent, lower-risk MDS, especially for treatment with the durability of RBCTI seen with Imetelstat.
Turning next to our medical affairs readiness to support our expected launch. We have a highly-skilled medical affairs team in place. This team has been instrumental in conducting peer-to-peer scientific exchange of medical information, particularly via medical congresses and publications. Awareness about Imetelstat in the hematology community has been heightened by Geron's presence at congresses like EHA and ASH, and particularly by the publication of Phase 3 IMerge data in the Lancet last year. Our medical affairs team will partner with our commercial colleagues on the important effort to have Imetelstat included in the NCCN guidelines once it is approved. Lastly, our field medical colleagues are in place and are prepared to be a critical resource in helping support physicians in managing their lower-risk MDS patients.
Turning now to our Phase 3 impact MS trial of a Imetelstat injecting inhibitor-relapsed refractory MS. We are proud to sponsor this first and only Phase 3 trial in MS that has overall survival as its primary end point. A total of 320 patients are planned to be enrolled using the two-to-one randomization for the hematopoietic arm versus the best available treatment arm. A protocol interim analysis has been planned when about 35% of the planned enrolled patients have died, and a final analysis when approximately 50% of the planned enrolled patients have died. As an overall survival study, the timeline for the interim and final analysis is dependent not only on the rate of enrollment, but also on the event rate or patient death rate in the trial.
The data monitoring committee evaluated unblinded data last month and recommended the study continue. In addition, we reviewed enrollment rates and blinded death rates, which are lower than anticipated in our initial planning assumptions. Accordingly, we are updating our guidance to extend the timeline by half a year and now expect the interim analysis in early 2026 and the final analysis in early 2027. Because the factors affecting these estimates are highly variable and difficult to predict, the actual interim and final analysis could occur sooner or later than we currently expect. As the trial continues, we'll continue to monitor enrollment and death rates and update guidance, if appropriate. Of note, we have multiple ongoing work streams to increase trial enrollment.
Our clinical operations team has been conducting onsite visits to clinical trial sites around the globe. Additionally, we've been increasing our engagement with patient advocacy groups in the myelofibrosis disease space. I think it's important to note that we at Geron, as well as the IMPACT-MS trial investigators and also patient advocates, continue to express excitement around the potential to extend survival in this JAK inhibitor relapse refractory population. Today, treatment of myelofibrosis is dominated by JAK inhibitors or therapies with other mechanisms of action in combination with JAK inhibitors. Once patients become unresponsive to JAK inhibitors, which leads to treatment discontinuation for approximately 75% of patients after five years, they face a dismal overall survival of approximately 11 to 16 months.
We believe that if our trial is successful and Imetelstat is approved in this indication, it could transform treatment for these patients. With that, I'll turn the call over to Michelle for a financial update. Michelle?
Michelle Robertson: Thanks, Faye, and good morning, everyone. For detailed Q1 2024 financials, please refer to the press release we issued this morning, which is available on our website. Now, let me bring your attention to a few highlights from the quarter. As of March 31, 2024, the company had approximately $465 million in cash and marketable securities, including proceeds from an underwritten public offering of common stock and a pre-funded warrant in March 2024 for net proceeds of approximately $141 million. Total operating expenses for the first quarter of 2024 were $56.4 million, compared to $40.1 million for the same period in 2023. Research and development expenses for the first quarter of 2024 were $29.4 million, compared to $27.2 million for the same period in 2023.
The increase year-over-year primarily reflects higher CMC costs due to the timing of Imetelstat commercial manufacturing batches and increased personnel-related expenses for additional headcount. G&A expenses for the first quarter of 2024 were $27.1 million, compared to $12.9 million for the same period in 2023. The increase primarily reflects our investment in commercial preparatory activities and higher personnel-related expenses for additional headcount, as we have been preparing to transition from a clinical to commercial stage company. As of March 31, 2024, and prior to adding our sales force in April, we had 162 full-time employees. Subject to approval of Imetelstat in the U.S., we plan to grow to a total of approximately 250 to 300 employees by year-end 2024.
Our projected full-year 2024 operating expenses are expected to be between $270 million and $280 million. Based on our current operating plans and our assumptions regarding the timing of potential approval and commercial launch of Imetelstat and TDLR-MDS in the U.S., we believe that our existing cash, cash equivalents, and current and non-current marketable securities, together with our projected revenues from U.S. sales of Imetelstat, if approved, potential proceeds from the exercise of our expanded warrants, and future drawdowns under our loan facility, will be sufficient to support our operations into the second quarter of 2026. I will now turn the call back over to Chip.
John Scarlett: Thanks, Michelle. We believe Imetelstat has the potential to offer a life-changing treatment option for patients with transfusion-dependent lower-risk MDS. Building on the momentum from the resoundingly positive ODAC, we're deeply energized and well prepared to launch Imetelstat in the U.S., if approved. Driven by our experienced leaders and expected excellent execution, we feel confident in our ability to capitalize on this robust opportunity and to transform Geron into a successful commercial company. We believe this transformation will create significant value for patients and shareholders alike. Let's now open the line to questions. Operator?
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