Chimerix - Q2 2024

Executive Summary

• Q2 2024 results reflected a development-stage profile: minimal revenue ($0.129M) and net loss of $20.7M ($0.23 EPS), with R&D spend rising on ACTION study execution; cash and investments totaled $171.5M and no debt.
• Management reiterated Phase 3 ACTION first interim OS readout timing for Q3 2025 and highlighted continued enrollment momentum across >140 sites in 13 countries, building U.S. launch readiness ahead of the interim data.
• ONC206 Phase 1 intensified dosing achieved sustained biologically active plasma concentrations beyond 24 hours with no dose-limiting toxicities to date; dose escalation expected to complete in 2024, with initial objective response assessment targeted for 1H25.
• Australia pathway advanced: dordaviprone Provisional Determination filed; management sees potential to apply for Provisional Registration by year-end 2024 with possible commercial availability in 2026, offering an early ex-U.S. catalyst.
• Wall Street consensus (S&P Global) was unavailable for CMRX at the time of this analysis due to mapping limitations; estimate-based beat/miss analysis cannot be provided (see Estimates Context).

What Went Well and What Went Wrong

What Went Well

• ACTION on track: “Our team continues to be laser focused on the execution and enrollment of the Phase III ACTION study, which is on track for the first interim overall survival readout in the third quarter of next year.”
• ONC206 safety/PK: “Biologically active concentrations of ONC206 were sustained for beyond 24 hours in plasma… peak plasma concentrations are well in excess of the compound’s IC50… with no meaningful changes in the overall adverse event profile as dosing has either escalated up or become more frequent.”
• Balance sheet strength and runway: CFO noted average burn of ~$16M per quarter over the past six months and runway “into 4Q of 2026” under current plan, providing funding capacity through key data milestones.

What Went Wrong

• Ongoing losses and limited revenue: Net loss widened YoY to $20.7M with negligible revenue ($0.129M), reflecting continued R&D investment and lack of commercial products.
• Higher R&D: Q2 R&D rose to $18.4M vs $16.9M YoY, driven primarily by ACTION study spend, pressuring near-term P&L.
• No near-term efficacy readout for ONC206: Initial objective response assessment is not expected until 1H25; interim ACTION OS remains 2025, limiting immediate clinical catalysts.

Transcript

Operator (participant)

Good morning, ladies and gentlemen, and welcome to the Chimerix second quarter 2024 earnings conference call. I mean, I would now like to introduce to you your, your host for today's call, Will O'Connor, for Stern Investor Relations. Please proceed.

Will O'Connor (Managing Director)

Thank you, operator. Good morning, everyone, and welcome to the Chimerix second quarter 2024 financial and operating results conference call. This morning, we issued a press release related to our second quarter operating update. You can access the press release in the investors section of the Chimerix website. With me today, with me on today's call, are President and Chief Executive Officer, Mike Andriole, Chief Financial Officer, Michelle LaSpaluto, and Chief Technology Officer, Josh Allen. We also have Allen Melemed, our Chief Medical Officer, and Tom Riga, our Chief Operating and Commercial Officer, for questions. Before we begin, I'd like to remind you that the statements made on today's call include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties and other factors.

These risks and uncertainties and other factors could cause actual results to differ materially from those referred to in the forward-looking statements. Please refer to our filings with the SEC for a more complete disclosure of these risks and uncertainties. At this time, I'll now turn the call over to Chimerix President and Chief Executive Officer, Mike Andriole.

Mike Andriole (CEO)

Thanks, Will. Good morning, everyone, and thank you for joining us. It's been a busy summer at Chimerix, and we continue to make meaningful progress across our clinical programs. Starting with our lead program, dordaviprone, our team continues to be laser-focused on the execution and enrollment of the Phase 3 ACTION study, which is on track for the first interim overall survival readout in the third quarter of next year. We're executing with urgency as there remains a significant need for patients battling this lethal disease. With no approved treatment options available that have proven clinical benefit beyond radiation therapy, we're keenly aware of the importance of speed in addressing this unmet need. It's because of this need that we continuously evaluate registration pathways globally to accelerate commercial access to dordaviprone where possible.

Earlier this year, we initiated the evaluation process for dordaviprone to be considered for provisional registration in Australia. Provisional registration is a three-step process that begins with a pre-submission meeting to evaluate current data, the status of pivotal studies, and other program features. Following a supportive pre-submission meeting earlier in the year, our team recently initiated the second step in this process, the filing of a provisional determination application. Should the regulators in Australia approve this application, the final step is to apply for provisional registration. If we proceed to this final step, it's expected that an NDA filing could occur as early as year-end 2024, with possible commercial availability in early 2026. This morning, we're also excited to provide a safety and PK update from our other clinical program, the second generation of imipridone, ONC206.

We're making great strides advancing this program through Phase 1 studies, which recently began dosing within an expected therapeutic range, and we are now enrolling the first of 2 remaining dose cohorts. As we escalate and intensify the dose within this range, we're encouraged by ongoing pharmacokinetic data that is in line with modeled expectations for delivering dose proportionate exposures for extended durations. Importantly, these exposures have not been associated with dose-limiting toxicities thus far. With these data, we have increasing confidence in the safety profile and therapeutic window for ONC206, and we look forward to completing enrollment in our dose escalation trials by the end of the year. I'll now turn the call over to Josh for a more detailed discussion on the ONC206 data we announced this morning. Josh?

Joshua Allen (CCO)

Thank you, Mike, and good morning, everyone. I'm delighted to provide an update on the program for our next generation product, ONC206, that is being evaluated in ongoing phase 1 clinical trials. I'll start with a reminder that this is a small molecule that shares the novel ClpP and DRD2 binding targets with its parent compound, dordaviprone, and exhibits a tenfold increase in potency while retaining favorable safety and oral administration attributes. It also maintains the relatively rare ability to penetrate the blood-brain barrier and has shown encouraging activity in non-clinical studies of specific forms of cancer, both within and outside of the central nervous system. In the ongoing phase 1 trials for pediatric and adult CNS tumors, we have previously completed dose escalation on a once per week administration schedule at doses reaching up to 350 milligrams.

That experience demonstrated the desired peak plasma concentrations and safety in patients that we expected based on our non-clinical models. In parallel to the clinical evaluation of this dose schedule, non-clinical studies suggested that the anticancer activity of this compound could be enhanced by prolonging the duration of time that tumor cells are exposed to biologically active concentrations. This appeared to potentially be achievable through dosing on a twice per day for three consecutive days per week administration schedule based on our modeling, and we have been busy testing this in the clinic this year. We have now generated human data for safety and pharmacokinetics, or PK for short, at doses reaching up to 100 milligrams at this intensified administration schedule.

We are happy to report that the tolerability of the compound continues to be favorable as we continue dose intensification, with no meaningful changes in the overall adverse event profile as the dosing has either escalated up or become more frequent. The most frequent treatment-related adverse events are fatigue, vomiting, and lymphopenia that have occurred in a minority of patients and are largely low grade. ... With respect to PK results, our goal was to sustain biologically active concentrations for a prolonged duration of time, and that is indeed what we have accomplished with the intensified dose schedule.

At 100 milligrams twice a day for 3 days per week, the human PK results showed that biologically active concentrations of ONC206 were sustained for beyond 24 hours in plasma, and that peak plasma concentrations are well in excess of the compound's IC50 in vitro, as well as exposures associated with in vivo efficacy in oncology models. Keep in mind that this is all based on plasma concentrations and that many target tissues are expected to have even higher exposure based on prior distribution studies in rodents. For example, brain tissue showed a twofold higher drug concentration relative to plasma, and that's before considering disruptions to vasculature in the tumor microenvironment that are expected to further augment drug delivery.

While that is already promising at the current dose, our modeling suggests that we may be able to push the dose up even a bit further to fully optimize the pharmacologic activity of the compound. We therefore have two more dose levels to enroll that we expect to top out at 200 milligrams twice a day for 3 consecutive days per week by the end of the year. This enrollment is on top of the more than 75 patients dosed to date that have provided a robust safety and PK data set. Following this, we will make a determination of how to best advance the compound into efficacy studies in selected populations. Establishing safety and PK are the primary goals of these studies.

However, we are all, of course, keen to look for objective responses whenever possible, and we have an eye on this in the current and future cohorts. These are phase 1 trials that enroll patients at various doses with many different forms of CNS cancer and at different time points in their disease journey that often involve surgery, radiotherapy, and chemotherapies. Therefore, assessment of response needs to be handled very carefully to avoid misinterpretation. Response assessment may be appropriate in the subset of patients who meet certain criteria, including those who have a CNS tumor that has progressed on prior therapy, received monotherapy ONC206 without concurrent or very recent anticancer interventions, are naive to imipridone treatment, have achieved adequate exposure to ONC206, and have disease characteristics that are evaluable by conventional response criteria for CNS tumors such as RANO.

The ongoing trials have recently begun enrolling patients who meet these specific criteria, and we expect some patients enrolled in the two remaining dose cohorts may also meet these criteria for appropriateness to evaluate objective response. This is an exciting opportunity to get an initial glimpse into the potential of ONC206 to treat CNS tumors, and we are carefully monitoring these patients in these higher dosing cohorts, in particular, those who are starting to stay on study beyond the typical window of time for DLT assessment, when we would otherwise expect further disease progression. Given the need to confirm responses and the importance of characterizing their durability, initial readout of objective response is expected to occur in the first half of 2025.

We're very excited about the current stage of the study, where ONC206 is now safely achieving sustained, biologically active concentrations in patients, some of which have forms of CNS cancer that are expected to be responsive to ONC206 based on preclinical models, and some of which have never been tested before in the clinic with either ONC206 or even ONC201. An example of that is medulloblastoma, where ONC206 has consistently shown compelling in vivo efficacy as a monotherapy in mouse models, and we have just enrolled our first patient with this tumor type. We look forward to updating you more on this program in the future that is evaluating the potential of ONC206 in indications beyond that of dordaviprone.

With that, I will turn the call over to Michelle for an update on financial results.

Michelle LaSpaluto (CFO)

Thank you, Josh. We continue a balanced approach of investing in R&D while keeping a tight control on G&A expenses, which has essentially been flat year-on-year. This discipline has allowed us to maintain an average burn for the past six months of about $16 million a quarter. We expect this rate to increase modestly in the quarters to come as we begin to make investments in launch readiness in advance of the interim OS assessment next year. As always, we remain confident in our ability to make smart investment decisions as we approach upcoming catalysts. Now, turning to the financial results for the quarter. Earlier today, we issued a press release containing our financial results for second quarter of 2024.

The second quarter of 2024, we reported a net loss of $20.7 million, compared to a net loss of $18.6 million in the same in the second quarter of 2023. Research and development expenses increased to $18.4 million for the second quarter of 2024, compared to $16.9 million for the same period in 2023. This was driven primarily by increases in spending in the ACTION study. General and administrative expenses remained essentially flat at $4.5 million for the second quarter of 2024, compared to $4.4 million for the same period in 2023. We ended the second quarter with just over $171 million in cash and cash equivalents. Under our current operational plan, we expect to have cash into 4Q of 2026.

With that, I will now turn the call back over to Mike.

Mike Andriole (CEO)

Thanks, Michelle.

...Throughout the remainder of 2024, we will continue to focus on the execution and enrollment of the Phase 3 ACTION study to accelerate this potentially life-altering drug to patients as quickly as possible, and we'll continue to advance our discussions with regulators in Australia and hope to reach agreement on filing for provisional registration before year's end. The safety and PK progress we reported today from the ONC206 program furthers our conviction in the potential for the second generation of imipridone, and we look forward to enrolling the remaining 2 dose cohorts yet this year. Lastly, as we move past the midpoint of the year, I'd like to take a brief moment to thank all of my fellow employees at Chimerix, who are working tirelessly to bring this pipeline to fruition. Thank you for your dedication to our mission.

It's this shared sense of purpose that drives our continued progress now and into the future. With that, Dustin, we'll open the call to questions.

Operator (participant)

Thank you, sir. As a reminder, if you'd like to ask a question, please press Star and the number one on your telephone keypad. We will begin the question-and-answer session. Our first question for today comes from the line of Maury Raycroft from Jefferies. The line is open.

Edward White (Analyst)

Hi, good morning. Congrats on the progress, and thanks for taking my questions. Maybe I'll start with 206. So for the higher dose cohorts for 206, could you potentially backfill any of those cohorts and maybe talk more about the first half of 2025 update? Can you talk about number of patients that you could report on, the amount of follow-up goals that you have, and how you plan on doing that disclosure as well?

Mike Andriole (CEO)

Yeah, thanks, Maury, for the question. I'm going to turn that over to Josh to answer both of those. Josh?

Joshua Allen (CCO)

Yeah, happy to do that, Maury. Good to hear from you. In terms of backfilling cohorts for the remaining couple that we're going through, we'll be looking at treatment-naive patients. I mean, there's the opportunity on the pediatric trial for some intrapatient dose escalation after naive patients have completed their DLT window. So by and large, we're looking really to load in patients that are in the treatment-naive setting. In terms of, you know, how many patients and how much follow-up we're looking at, in general, these are, especially as we get into the final cohorts of the study, tend to follow more of the 3 + 3 kind of paradigm. Keep in mind, there's two different trials, two different enrollment settings for pediatrics.

So, you know, we should have an experience that follows somewhere in that range with about three cohorts following roughly a 3 + 3 design. In terms of the amount of follow-up, you know, the DLT window, keeping in mind safety is the primary goal of this study, lands at around a month. So that's what you need sort of for safety. Response assessment, like I mentioned in my prepared remarks, takes a little more time to confirm and characterize durability. So we're looking more at the first half of 2025 when we look at how long we would need to follow some of those patients out in these final cohorts for initial look and response.

Edward White (Analyst)

Got it. Okay. And, anything more you're seeing about the types of tumors that could be in that update? Any baseline trends that you're seeing that you can comment on?

Joshua Allen (CCO)

Not too much to say other than, you know, I mentioned the medulloblastoma example there. I'll just note that ONC201 within CNS tumors was largely limited in its exploration to glioblastoma and H3 K27M-mutant glioma. Given, you know, some of the initial stages of escalation with 206 when it started in its program at a time ACTION wasn't open, there was, you know, a variety of tumors that may have came into that initial experience. But we really think there's a lot of other CNS tumors that have never been tested before with either ONC206 or ONC201, that, that could make sense based on the mechanism and nonclinical data.

So we're really excited in these final cohorts to get into some of these tumor types that we think could make sense, that we've never tested before. Medulloblastoma is just one example of that I mentioned there, and look forward to seeing if we get more patients that fit that profile and updating on them in the future.

Edward White (Analyst)

Got it. Okay, and maybe I'll ask one question on 201 and hop back in the queue. Just for the new guidance for the interim overall survival data in third quarter of this year or of 2025, are you seeing event rates stabilize, or is there anything else on clinical metrics that you can comment on that you're seeing in the study?

Mike Andriole (CEO)

Yeah. Thanks, Maury, for the question. Certainly seeing enrollment rates are consistent, stable, and predictable at this point. Event rates, blinded event rates are just now beginning to come in, so I'd say still early days on blinded event rates, but stay tuned in the coming quarters for updates there. We have enough confidence to project out about a year when we expect that first interim OS, but more to follow on blinded event rates and observed event rates as we get into the next quarter, I think it'll be instructive.

Edward White (Analyst)

Got it. Okay, thanks for taking my questions.

Mike Andriole (CEO)

Sure.

Operator (participant)

Thank you. Our next question comes from the line of Soumit Roy from Jones Research. The line is open.

Edward White (Analyst)

Good morning, everyone, and congrats on all the progress. Sorry, I missed the comment on the last question. Did you provide any color on the enrollment status? Like, how far along is it, the Phase 3 ACTION trial is enrolled? And will you be providing any baseline characteristics, in a blinded fashion ahead of, well ahead of the data?

Mike Andriole (CEO)

Yeah. Hey, Soumit, thank you for the question. Yeah, enrollment, we continue to be excited about the level of engagement from investigators around the world, not just in the U.S., but really a really balanced enrollment between the U.S., Europe, and Asia, and really proportional. So continues to be very encouraging. We're seeing meaningful contributions geographically around around the world. We haven't provided exact guidance on where we are with enrollment, but we're on track to meet that first interim OS assessment in Q3 of next year. With respect to early disclosures of patient characteristics, we're not planning to do that. That will be part of, that'll be part of the final data readout.

Edward White (Analyst)

Okay, one last question. Would you be providing any color on screen failure rate? Is it matching up with your prior experience, or if anything changed, by geographic location or any other metrics?

Mike Andriole (CEO)

Thanks, Soumit. I'll turn that over to Allen for comment. Allen?

Allen Melemed (Chief Medical Officer)

Our screen failure rate is as we've been expecting it to. These are hard patients to get, as it is a rare patient population, and our enrollment does have specific criteria that is necessary to show activity. But our screen failure rate has been consistent throughout the study at this point.

Mike Andriole (CEO)

Yeah, and it's pretty much in line with what we expected at the start of the study.

Allen Melemed (Chief Medical Officer)

Correct.

Mike Andriole (CEO)

Yeah.

Edward White (Analyst)

Great. Thank you so much.

Mike Andriole (CEO)

Sure.

Operator (participant)

Thank you. Our next question comes from the line of Edward White from H.C. Wainwright. The line's open.

Edward White (Analyst)

Good morning. Thanks for taking my questions. Just to follow up on the 206 study, you had mentioned that the response data could be available in the first half of 2025. What about the, you know, further PK, final PK and safety data? Would that be available before that, and if you would disclose before that or just wait until you get the response rate data?

Mike Andriole (CEO)

Yeah. Thanks, Ed, for the question. I'll turn that over to Josh. Josh?

Joshua Allen (CCO)

Yeah, Ed, nice to hear from you. Thanks for the question. You know, the safety experience really requires, you know, about a month DLT window, right? So I mentioned that we plan to round out the rest of the dose escalation cohorts by the end of the year. So I would expect safety data and PK data to follow in, you know, the months to come after that.

Edward White (Analyst)

Okay, thanks. And just on dordaviprone, you know, if you could just discuss your ex-US strategy, in particular, Australia. I think you had mentioned prior that you were looking to get a distribution agreement for Australia. Are you making any progress there or any progress outside of the U.S.?

Mike Andriole (CEO)

Yeah. Thanks, Ed. We've been studying that commercial model outside of the US for some time. I'm going to ask Tom, Tom Riga to comment on our status there. Tom?

Thomas Riga (COO)

Hey, Ed, nice to hear from you. Yeah, we're doing a lot of work on that. I think the first step here is to work through the TGA process and subsequently the HTA process for reimbursement. But we are looking at a lean commercial model that could include, distribution partners and other strategies that will minimize the expense here at Chimerix, but enable us to provide commercial availability. So more to follow as we progress through the regulatory process, but we are actively engaged in, studying that business case.

Edward White (Analyst)

Okay, thanks, Tom. And my last question is just for Michelle. You had mentioned that you are making investments in the launch and expect to see operating expenses increase modestly. What kind of investments have been made towards the launch so far? And you know, are these, should we be thinking mostly for 2025, or will some of these expenses impact the back half of this year?

Michelle LaSpaluto (CFO)

Yeah, Ed, thanks. So we have seen, we've made a little bit of investment in this year, obviously, with Tom coming on board, and I do expect that, as I mentioned, to increase a little bit more this year, but obviously a little bit more as we continue into 2025. So Tom, did you want to maybe elaborate a little bit on some of the early investments?

Thomas Riga (COO)

Yeah, Ed, we're taking a gated approach to our spend on launch that lines up to our development milestones. So, in the early days, we're engaging key stakeholders, obviously, the investigators and the customer base through ACTION, as well as patient advocacy. And the third stakeholder here is the payer and starting to engage and have early conversations there. So I think what you can expect from a burn standpoint in the back half of this year is modest. That work will involve both salesforce size, structure, forecasting work to round out our early efforts in that regard, but it won't involve substantial increase in headcount and others. So we're going to take a measured approach here to make sure that we're ready for the first interim here in Q3 of next year.

Edward White (Analyst)

Okay, thanks for taking my question.

Mike Andriole (CEO)

Sure, Ed. Thanks.

Operator (participant)

Thank you. Our next question comes from the line of Troy Langford from TD Cowen. The line's open.

Troy Langford (Analyst)

Hi. Congrats on progress this quarter, and thanks for taking our questions. I just have two questions, both on dordaviprone. First, can you all just remind us how large you think the commercial opportunity for dordaviprone in Australia could be relative to that of the U.S. and EU? And then, related to that, do you think the TGA will want to see that first interim OS data from the ACTION study before they issue an approval?

Mike Andriole (CEO)

Yeah. Let me also... thanks, Troy. So, Mike, I'll, I'll start with that first question, then I'll ask Tom to comment on the size of the commercial opportunity in Australia. But, you know, with respect to our interactions with, with TGA to date, it's been focused on the phase 2 50-patient registration cohort that we did the BICR on some time ago and the output of that. So, there is certainly within that window the potential for that interim OS to read out, and yet that's not the basis of our discussions with regulators in Australia. It's really on the phase 2 response rate data. Tom, you want to talk about the commercial opportunity?

Thomas Riga (COO)

Yeah. Commercial opportunity in Australia is small relative to Europe and US, obviously, based on population. I think that proof of concept, I think, is important both for gaining first regulatory approval, as well as providing commercial access for patients in need. So that could be a business that is interesting if managed in a lean fashion from an overall operating expense, and we are looking forward to that potential opportunity.

Troy Langford (Analyst)

Great. Thanks for all the color.

Operator (participant)

Thank you. Seeing as there are no more questions in the queue, that concludes our question and answer session. I will now turn the call back over to Mike Andriole for closing remarks.

Mike Andriole (CEO)

Thanks, Dustin, and thank you, everyone, for your time this morning. We look forward to updating you in the coming months.

Operator (participant)

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.