Analyst Conference Summary

biotechnology

Release date: May 6, 2021 @ 4:30 AM Pacific Time
for quarter ending: March 31, 2020 (first quarter 2021, Q1)

Forward-looking statements

Overview:

Basic data (GAAP): Tazverik revenue still ramping very slowly.

Revenue was $7.6 million, down 10% sequentially from $8.4 million, and up from $1.4 million in the year-earlier quarter.

Net income was negative $70.3 million, down sequentially from negative $66.2 million, and down from negative $50.9 million year-earlier.

EPS was negative $0.69, down sequentially from negative $0.65, and down from negative $0.51 year-earlier.

Guidance:

Cash runway into 2023. 2021 non-GAAP op ex $235 to $255 million.

Conference Highlights:

Robert Bazemore, President and CEO said "In early March, we hosted a strategic vision call to outline the pipeline-in-a-drug potential we see in Tazverik and plans to expand our portfolio starting with the anticipated IND submission for our novel SETD2 inhibitor in mid-2021. We plan to share additional pre-clinical data supporting the advancement of our SETD2 program at the European Hematology Association Congress 2021. During the Vision Call we also shared encouraging preliminary safety and activity data from ongoing combination trials in follicular lymphoma and prostate cancer and look forward to providing a steady stream of data updates from these and our many other planned and ongoing trials over the next few years." March 2021 had the highest Tazverik sales since the launch. Field reps are now allowed to travel again for in person contacts, but Q1 was almost completely virtual.

Tazverik revenue wss $6.2 million, up 38% sequentially from $4.5 million and well up from $1.3 million year-earlier. Was approved in Q4 2019, but no revenue that quarter. Collaboration revenue was $1.4 million. In February 2021, the NCCN Clinical Practice Guidelines in Oncology were amended to recommend Tazverik for relapsed/refractory FL patients with no satisfactory treatment options and whose EZH2 status is unknown.

Despite the slow ramp, Epizyme believes Tazverik represents a multi-billion dollar global market oppertunity. Only 800 ES patients in the U.S., about 300 eligible for Tazverik. Average ES duration of therapy 4 to 5 months. Expects physicians will use earlier as they gain experience. Believes FL presciptions will improve as pandemic subsides.

The Tazverik (tazemetostat) for follicular lymphoma (a kind of NHL), relapsed/refractory, was approved by the FDA on June 18, 2020, for third-line therapy. Covers both EZH2 mutations and wild type EXH2. New prescribing accounts increased 38% in Q1 2021 compared to Q4 2020, including broader adoption among community practices. A confirmatory study will be needed for full approval. In 2020 Epizyme plans to expand clinical investigation of tazemetostat in combination with R-CHOP in the high-risk front-line treatment setting for patients with FL; and support the investigator-sponsored studies assessing tazemetostat in combination with rituximab, venetoclax and BTK inhibitors in the third-line and later FL treatment setting.

The combination of tazemetostat with standard-of-care treatments, enzalutamide or abiraterone, was evaluated in the Phase 1b safety run-in portion of the EZH-1101 trial which enrolled a total of 21 men with metastatic prostate cancer. Preliminary data later in 2021. Epizyme plans to initiate two signal finding basket studies to evaluate tazemetostat safety and efficacy across multiple new types of hematologic malignancies and solid tumors.

The safety portions of both the ES and FL confirmatory trials with Tazverik are both fully enrolled and the efficacy expansion portions of both trials remain on track. The ES confirmatory trial is evaluating Tazverik in combination with doxorubicin compared with doxorubicin plus placebo as a front-line treatment for ES. The FL confirmatory trial is evaluating Tazverik in combination with R2 (Revlimid plus Rituxan) compared with R2 plus placebo in the second-line treatment setting in patients. Progress around the clinical development of tazemetostat in earlier lines of therapy for FL and opportunities in new solid tumor indications, including prostate cancer, continues. Patient enrollment also continues in several collaborative studies, including the Lymphoma Study Association (LYSA) trial in front-line Diffuse Large B-cell Lymphoma (DLBCL) and FL, and in investigator sponsored trials.

SETD2 inhibitor molectule IND planned for mid-2021. Preclinical data is in the slide show.

See also the Epizyme pipeline page.

Cash and equivalents ended at $299 million, down sequentially from $374 million. Long term debt was $216 million.

Operating expenses of $72 million consisted of: cost of goods sold $3 million; $33 million for R&D and $37 million for general and administrative. Loss from operations was $64 million. Other expense was $6 million.

Q&A summary:

Confidence in accelerated sales? In 2021 with reps in field and patients returning for visits we see more switching and adoption.

R2 study efficacy analysis? 302 has 2 interims, first for tolerability, second includes efficacy and could allow for stopping the study. We completed the safety run in quickly, saw no additional safety concerns.

600 mg BID dose? Goal is to insure dose optimization.

Generally genetic testing in FL is not specific to whether to use Tazverik. Now some physicians want to test only for EZH2, so we are working on helping with that.

Basket study, what indications could read out first? Goal is to look at the cohorts at the same time. Is open label. Data should read out regularly starting in 2022.

SETD2 initial study? First we will optomize the monotherapy dose. Likely to expand in multiple myeloma. Then we could look at combination therapies.

We are seeing a lot of physician interest in the Tazverik combination studies.

Prescriptions, wild type v. mutant? Predominantly in 3rd or greater setting, some 2nd, data is not in the claim so we do market research. We see more use in mutant than wild type. As we expected. And there is the group that were not tested for status.

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