Analyst Conference Summary

biotechnology

conference date: March 13, 2018 @ 5:30 AM Pacific Time
for quarter ending: December 31, 2017 (fourth quarter 2017, Q4)

Forward-looking statements

Overview: Hopes will file its first tazemetostat NDA with the FDA in 2018.

Basic data (GAAP):

Revenue was $0.0 million, down sequentially from $0.0 million, and down from $0.5 million in the year-earlier quarter.

Net loss was $36.2 million, up sequentially from a loss of $37.6 million, and down from a $35.0 million loss year-earlier.

EPS was negative $0.52, up sequentially from negative $0.63, and down from negative $0.60 year-earlier.

Guidance:

Believes cash is sufficient into Q3 2019.

Conference Highlights:

Robert Bazemore, president and CEO said “We plan to submit our first NDA for tazemetostat for the treatment of patients with epithelioid sarcoma in the fourth quarter and are targeting a second NDA submission for the treatment of follicular lymphoma in 2019. We plan to present updated data from both of these programs this year, as well as from our studies in mesothelioma, diffuse large B-cell lymphoma, and other adult INI1-negative tumors. In addition, Epizyme will be readying its next product candidate, EZM8266, for the clinic."

Sees tazemetostat as potentially treating both solid and blood cancers, in multiple indications, and eventually in the first-line setting.

Epizyme has a global development plan for tazemetostat (an EZH2 inhibitor), in several cancer indications.

Tazemetosta for epithelioid sarcoma trials had positive Phase 2 results that may qualify for accelerated approval (before a Phase 3 trial). Updated data from Phase 2 will be presented in the second half of 2018, with an NDA planned for Q4 2018. A confirmatory study is being prepared to support the registration strategy and full approval. ES is rare but usually deadly.

Tazemetosta for follicular lymphoma (a kind of NHL) Phase 2 study EZH2+ cohort should complete enrollment in 2018 (wild-type cohort completed in 2017). More data due in 2018. Epizyme will continue to work with the FDA to refine a registration strategy for accelerated approval. Already has orphan and fast-track status. A combination study is planned to start before the end of 2018.

Tazemetostat is in Phase 2 combination with prednisolone, RCHOP, and atezolizumab cohorts in relapsed/refractory DLBCL, (another kind of NHL). Monotherapy cohort's enrollment should complete in 2018, more data should be released, and the regulatory plan could be updated.

Tazemetostat is also in a three-arm phase 2 study in adult patients with certain genetically defined, InI1-negative solid tumors. The pediatric recommended dose was established in a Phase 1 study.

In mesothelioma, Tazemetostat trial completed Phase 2 enrollment in Q2 2017. The study achieved its primary endpoint, a 30% disease control rate at 12 weeks. Durability will be assessed, with data in 2018. FDA granted orphan drug designation for this indication in September. Next steps should be communicated by mid-2018.

A Tazemetostat study for pediatric patients with genetically defined solid tumors or NHL was started by the NCI in July 2017 with enrollment to complete in 2018.

A Phase 1b study of tazemetostat with Tecentriq for patients with with relapsed/refractory diffuse large B-cell lymphoma (DLBCL) was continuing by Genentech/Roche. Also planned is a similar trial in non-small cell long cancer.

Tazemetostat in pediatric patients with INI1-negative solid tumors Phase 1 dose escalation data was presented at the AACR-NCI-EORTC International Conference on Molecular Targets and Cancer Therapeutics. Objective responses were observed in patients with epithelioid sarcoma (n=1), poorly differentiated chordoma (n=2) and atypical teratoid rhabdoid tumors (n=1) at dose levels ranging from 520 to 900 mg/m2 twice daily.

A dose-escalation study of pinometostat in pediatric patients with MLL-r acute leukemia is continuing enrollment. Epizyme is partnering with Celgene for potential clinical development of pinometostat in combination with other agents.

EZM8266 for G9a [EHMT2] inhibition is in clinical approach, preclinical details were presented at ASH. It targets sickle cell disease. But Phase 1 won't start until 2019.

Epizyme has preclinical work underway with five new targets that are planned for introduction into the clinic by 2020.

Three programs are partnered with GSK and three with Celgene, including some that are undisclosed.

See also the Epizyme pipeline page.

Cash and equivalents ended at $276.4 million, up sequentially from $307.2 million. Epizyme believes it has sufficient funding though at least the third quarter of 2019. Longer if milestone payments are received or new partnership revenue comes in.

Operating expenses of $37 million consisted of $29 million for R&D and $8 million for general and administrative. Loss from operations was $37 million. Other income was $1 million.

Q&A:

Tazemetosta for epithelioid sarcoma, is the requirement for data from FDA consistent with preliminary results? FDA indicated the data across the whole cohort of 62 patients would need to be at least as good as the data we saw for the first 31 patients. Enrollment was strong, so we are confident we will be in a great position to submit the NDA in Q4.

Tazemetosta for follicular lymphoma, define good data for mutant v. wild type? Data is still evolving in both groups of patients, as we are following for durability. Tolerability is important compared to other classes of drugs. The agency does not look at these populations differently; we wanted that data. We are making great progress on enrollment, including screening more quickly. Full enrollment this year, NDA in 2019.

Confirmatory studies design and timing? In FL each cohort was designed to be 45 patients, total 90. DLBCL cohorts 60 per, total 180. Accelerated approvals required for eventual full approval. FDA likes to see a good-faith attempt to get started, but not necessarily first patient in before the approval.

DLBCL combination data from trials not sponsored by company? RCHOP frontline run by French has two parts, dose escalation followed by Phase 2 efficacy. First data will be from dose escalation, with focus on safety. combo is all comer, with ORR and safety, but checkpoints don't usually work in cold tumors. Prednisolone combo is fully ours, looking for OR for wild type relapsed refractory.

Non-small cell lung cancer is a hot tumor, which we also have a Genentech atezolizumab combo trial for.

We believe we can launch with a relatively small commercial footprint since patients tend to end up in specialty centers.

We believe the second 31 patients in epithelioid sarcoma are like the first 31.

Pricing strategy will depend on the label we get.

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