Analyst Conference Summary

biotechnology

conference date: May 4, 2018 @ 5:00 AM Pacific Time
for quarter ending: March 31, 2017 (Q1, first quarter 2018)

Forward-looking statements

Note: Q1 results were combined with an Analyst Day, so the whole affair lasted over 4 hours. This summary is even more abbreviated than usual. There were 2 Q&A sessions, here summarized as one, with many Q & A eliminated as previously answered or of only marginal relevance.

Overview: Getting ready for Tibsovo launch, pending FDA approval. I see Idhifa royalty revenue number as disappointing.

Basic data (GAAP):

Revenue was $8.8 million, down 10% sequentially from $9.8 million, and down 16% from $10.5 million year-earlier.

Net income was negative $90.8 million, down sequentially from negative $88.3 million, and down from negative $66.2 million year-earlier.

EPS (diluted GAAP) was negative $, up sequentially from negative $1.81, and up from negative $ year-earlier.

Guidance:

none

Conference Highlights:

David Schenkein, M.D., CEO of Agios said "As we prepare to launch our second Agios-discovered and first wholly owned medicine later this year, we continue to invest in our productive drug discovery engine and advance a robust pipeline of first-in-class medicines. Our first quarter progress against that objective was highlighted by the NDA acceptance of Tibsovo in IDH1m relapsed or refractory AML and multiple clinical trial initiations, including dosing the first patient with our MAT2A inhibitor AG-270 and the start of our AG-348 pivotal program in PK deficiency.”

"Our research engine is poised to deliver the next wave of development candidates. 9 programs are currently in drug discovery."

The preclincal pipeline was illustrated on Slide 19:

$1.4 million of revenue in the quarter was from royalties for Idhifa, up sequentially from $1.2 million. Idhiba was not on the market year-earlier. $7.3 million was from collaborations.

In the quarter raised $516 million through a public stock offering of over 8 million shares at $67.00 per share.

Idhifa (AG-221, Enasidenib) for IDH2 positive relapsed/refractory AML (acute myeloid leukemia) was approved by the FDA on August 1, 2017. This is in partnership with Celgene. An MDS trial is also planned. Celgene markets Idhifa and pay Agios tiered royalties, ranging from single digits to low double digits. More data will be released this year.

Tibsovo (AG-120 or ivosidenib) in R/R AML patients with an IDH1 mutation FDA PDUFA date is August 21, 2018. An EMA submission should be made before the end of 2018.

The commercial infrastructure to launch Tibsovo has been completed.

With Celgene, Agios plans to start a Phase 3 trial for frontline AML combining ivosidenib or enasidenib with 7+3 chemotherapy in Q4 2018. Updated Phase 1/2 data from the trial combining Tibsovo or Idhifa with Vidaza has been submitted for ASCO.

A randomized Phase 3 study (ClarlDHy) of AG-120 (ivosidenib) in IDH1 mutant positive cholangiocarcinoma in continued enrollment, which is expected to complete in first half of 2019. If approved would be the first targeted therapy for this disease, which has about 3,000 IDH1+ patients annually.

Further combination trials with a variety of agents and target variants are planned for ivosidenib.

Phase 1 dose-escalation and expansion study of AG-881 in IDH mutant positive hematologic malignancies completed the dose-escalation phase. Another Phase 1 study for IDHm positive glioma should report data at ASCO. Also looking at ivosidenib as a possible treatment for this disease.

Phase 1 study of AG-519 for PK deficiency in healthy volunteers enrollment continues.

AG-348 for Pyruvate Kinase Deficiency (PKD) single arm pivotal trial was initiated. Has Fast Track designation. Agios fully owns 348. An additional trial, Activate, will start in 2018. A Phase 2 proof of concept trial for thalassemia will begin in Q4 2018.

Preclinical activities continued for AG-270 for MTAP (methylthioadenosine phosphorylase) deleted cancers .... 15% of all cancers have MTAP deletions. But some, like mesothelioma and glioblastoma, have rates over 50%. Celgene is collaborating on AG-270. A Phase 1 study

Will initiate preclinical development activities for the first molecule in the next wave of novel investigational cancer metabolism medicines.

An IND for AG-636, an DHODH (dihydroorotate dehydrogenase) inhibitor, for hematologic malignancies should be submitted in Q4 2018.

Cash (including equivalents & securities) ended at $995 million, up sequentially from $568 million. $516 million raised in January 2018. No debt. "Well financed through at least the end of 2020."

GAAP operating expenses were $102.8 million, consisting of: $78.2 million for R&D and $24.6 million for G&A. Loss from operations was $94.0 million. Interest income was $3.2 million.

Q&A:

In PKU, you showed you can stabilize one mutation, but there are over 900? Not ready to disclose, but confident will be able to cover a significant chunk of the patient population.

Isn't IO messier, and so why not stick to where you have proven precision capabilities? IO needs precision approaches, ours is aspirational right now. We need to identify precise targets to create precise therapies.

BioMarin's pegvaliase for PKU approval is on the horizon, but there is a high discontinuation rate and requires continued dieting for many patients. Ours would be an oral therapy and could be more potent.

348, juvenile and pediatric patients? Some current patients are on a dose as low as 5 mg daily. We want to talk more to doctors who take care of younger patients. A follow-on molecule could also be of interest.

Tibsovo in MDS (myelodysplastic syndrome)? We have some compelling data in a small number of patients. We need to gather more data before determining a registration path.

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