Chimerix - Q3 2024

Executive Summary

• Q3 2024 delivered disciplined execution: ACTION Phase 3 passed the IDMC safety review with a recommendation to continue the study “as-is,” including the higher-intensity twice-weekly dose; the company remains on-track for the first interim OS readout in Q3 2025.
• Australia pathway accelerated: alignment to submit the dordaviprone NDA for Provisional Approval “in the coming months,” with potential commercial availability as soon as year-end 2025 (earlier than the Q2 expectation of possible 2026).
• Financials: net loss of $22.9M ($0.26 per share) vs $24.0M ($0.27) YoY as R&D rose on ACTION spend and G&A declined due to prior-year one-time non-cash equity expense; cash and investments totaled $152.4M with no debt.
• ONC206 progressing: dose-escalation nearing completion, exposures in the modeled therapeutic range, and objective response assessments to begin in H1 2025; no dose-limiting toxicities observed to date across adult and pediatric cohorts.
• Near-term catalysts: submission of Australia provisional NDA, SNO/EANO presence elevating awareness, ONC206 dose-escalation completion by year-end, and mid-2025 first potential response assessments; these set the narrative ahead of ACTION interim OS data in Q3 2025.

What Went Well and What Went Wrong

What Went Well

• ACTION Phase 3 passed the preplanned IDMC safety review with a recommendation to continue the study without changes, supporting the tolerability of both weekly and twice-weekly dosing arms and de-risking execution heading into the interim analysis.
• Regulatory momentum: orphan designation from the TGA and alignment to file for Provisional Approval in Australia in the coming months, with potential availability by year-end 2025, indicating a viable accelerated path outside the U.S..
• ONC206 safety/PK: dose intensification achieved dose-proportionate exposure with no dose-limiting toxicities; majority of TRAEs mild-to-moderate, consistent across adults/pediatrics—supporting confidence in reaching biologically active exposures .

Quote: “The IDMC’s preplanned safety review…recommended continuing study conduct as-is, including at the more intense twice per week dose.” — CEO Mike Andriole.
Quote: “We now have alignment to file a New Drug Application (NDA) for Provisional Approval in Australia…expected to occur in the coming months.” — CEO Mike Andriole.

What Went Wrong

• Ongoing operating losses: Q3 net loss of $22.9M with R&D elevated ($19.6M) due to ACTION execution; minimal revenue ($26k) keeps margins not meaningful and heightens dependence on cash/runway.
• Consensus context unavailable: S&P Global consensus mapping failed for CMRX, preventing beat/miss benchmarking versus Street for Q3 (limits near-term estimate-driven catalysts in public markets). Values retrieved from S&P Global were unavailable due to mapping; see Estimates Context.
• Royalty/milestones timing uncertainty: while BARDA partially exercised $67.4M of TEMBEXA procurement options at Emergent, CMRX expects ~$2.7M tied to this but will only recognize after cash receipt, adding timing uncertainty to non-dilutive inflows.

Transcript

Operator (participant)

Good morning, ladies and gentlemen, and welcome to the Chimerix Q3 2024 Earnings Conference Call. I would now like to introduce you to your host for today's call, Will O'Connor from Stern Investor Relations. Please proceed.

Will O'Connor (Managing Director and Team Lead)

Thank you, Operator. Good morning, everyone, and welcome to the Chimerix Q3 2024 Financial and Operating Results Conference Call. This morning, we issued a press release related to our Q3 operating update. You can access the press release in our Investors section of the website. With me today on today's call are President and Chief Executive Officer Mike Andriole, Chief Scientific Officer Josh Allen, Chief Financial Officer Michelle LaSpaluto, Chief Medical Officer Allen Melemed, and Chief Operating and Commercial Officer Tom Riga 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 President and Chief Executive Officer Mike Andriole.

Mike Andriole (President, CEO, and Director)

Thank you, Will. Good morning, everyone, and thanks for joining us. The Q3 was marked by continued execution across our pipeline, including continued enrollment in our global phase III ACTION Study of dordaviprone, and we are nearing complete enrollment of our phase I dose escalation studies for our second-generation imipridone ONC206. The phase III ACTION Study is active in 15 countries worldwide, and our first interim data readout is potentially less than a year away. During this past quarter, we received confirmation from the pre-specified interim safety review undertaken by the study's independent data monitoring committee, which recommended the ACTION Study continue as is with no change to study conduct.

This is always welcome news, but even more so in the case of the ACTION study, where we have two treatment arms: one at the phase II 625 mg dose administered once per week and a second treatment arm administering 625 mg twice per week on consecutive days, or essentially a double dose of the phase II schedule. Passing this IDMC safety review with no change to study conduct to any arm is a meaningful milestone and underscores the well-documented safety profile of dordaviprone that makes it both a promising profile as a potential monotherapy but also an ideal candidate as a potential backbone therapy. Last month, we participated in the European Association of Neuro-Oncology annual meeting in Glasgow, Scotland.

It was evident that the enthusiasm across the European community for this program and the degree of support from so many investigators who recognize the very high unmet need in this patient population only continues to strengthen with time. Turning a little closer to home, the annual meeting for the Society for Neuro-Oncology, also known as SNO, will occur in Houston, Texas, later this month, where we're planning a large presence. We view our partnership with the SNO organizers and engagement at this pivotal conference as important to the success of our programs. Not only will we have presentations for dordaviprone, but we'll also showcase ONC206. Abstracts for that conference will release next week, so please stay tuned for more details. For those attending, we're looking forward to seeing many of you and our investigators in person.

We continue to make progress with the Therapeutic Goods Administration, or TGA, to file for provisional approval in Australia. While this was not on our radar last year, we were agile when an opportunity arose earlier this year, and we're now in a position to file an NDA for provisional approval around year-end. Having the NDA document ready for submission in Australia also aids our capacity and timelines should we have a positive interim overall survival outcome for ACTION next year. To that end, we are judiciously preparing the company and the market for dordaviprone's potential commercialization, as we may be within a year from the first interim readout. With our phase III ACTION study and our expanded access programs in the U.S. and Europe, we now have a well-laid foundation with hospitals and physicians who have ongoing treatment experience with dordaviprone.

Recall, there are no approved therapies specific to this patient population, and we consequently expect a rapid uptake upon potential commercialization, forecasting a potential global market opportunity over $750 million. Turning to our second-generation imipridone ONC206, our objective for the year is to gather safety and PK data in an unselected CNS patient population and to evaluate lead indications for the program. I'm happy to report the phase I dose escalation is nearing completion, and the lab has been working diligently on nonclinical studies to inform the next step for the program. We continue to see ONC206 is well tolerated in adult and pediatric patients as we near completion of the dose escalation studies. As we review the incoming clinical and preclinical data, we plan to announce next steps for the program in the coming months.

Before I turn the call over to Michelle for a review of the financials, I'd like to take a brief moment to recognize the recent promotion of Josh Allen as our Chief Scientific Officer. Since joining Chimerix in 2021 with the acquisition of Oncoceutics, Josh has been an integral team leader and a trusted colleague to many across the company and has continually advanced the research and development of the imipridone class of compounds from academic discovery to the lead registration phase program. Please join me in congratulating Josh on this well-deserved promotion. With that, I'll turn the call over to Michelle for a brief review of our financials.

Michelle LaSpaluto (CFO)

Thank you, Mike. Earlier today, we issued a press release containing our financial results for the Q3 of 2024. For the Q3 of 2024, we reported a net loss of $22.9 million compared to a net loss of $24 million in the Q3 of 2023. Research and development expenses increased to $19.6 million for the Q3 of 2024 compared to $17.4 million for the same period of 2023. This was primarily driven by increased spending in the ACTION study. General and administrative expenses decreased to $5.2 million for the Q3 of 2024 compared to $9.3 million for the same period in 2023. This decrease is due to a one-time non-cash expense related to historical grants recognized during the same period in 2023. We ended the Q3 with just over $152 million in cash and cash equivalents. As anticipated, our cash burn rate did experience a modest increase this quarter.

As in preparation for the commercialization of dordaviprone, we are committed to sensible cash management. Currently, we have a cash runway extending into the Q4 of 2026. With that, I will turn the call back over to Mike for closing remarks.

Mike Andriole (President, CEO, and Director)

Thanks, Michelle. We've continued to execute our plan as expected in the Q3 with a focus on bringing dordaviprone to patients as soon as possible. We're beginning to prepare our organization to launch dordaviprone and are excited about the promise to further broaden our pipeline in the future by advancing ONC206 or through business development initiatives. With that, Leonardo, we'll open the call to questions.

Operator (participant)

Thank you. We will now begin the question and answer session. At this time, I would like to remind everyone in order to ask a question, press the star and then the number one on your telephone keypad. If you are called upon to ask your question and are listening by a loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Now, we will pause for a moment to compile the question and answer roster. Your first question comes from the line of Maury Raycroft. Please go ahead.

Maury Raycroft (Analyst)

Update. Can you talk about how you're preparing the submission of the NDA for Australia and a potential launch by the end of 2025? How are you using these commercialization efforts to potentially scale the organization for a potential U.S. launch too? Do you plan to leverage that NDA submission to dovetail into conversations with other regulatory agencies for accelerated approval paths as well?

Mike Andriole (President, CEO, and Director)

Yeah. No, thanks for the question. So there's probably two parts to that question. There's a regulatory component and a commercial component. So I'll ask Tom Riga to comment on the commercial side. On the regulatory side, having the backbone of the new drug application complete for Australia has great utility in other markets around the world. There's a lot of overlap between that backbone and what might be needed or expected in other markets around the world. So we see synergy there in having this ready. Of course, the efficacy component for this application will be predicated on the phase II response rate data that we've previously announced.

In terms of where we might utilize that in other markets around the world, we continue to look at the ACTION study as the first opportunity for registration in other markets around the world, but should that change, we'll update the market accordingly. Tom, do you want to comment on commercial?

Tom Riga (COO and Chief Commercial Officer)

Yeah. We are enthusiastic to be inside of a year of first potential data from the ACTION study. I think as we approach the market, our medical affairs team is up and running and in full force, and the early commercialization efforts are focused around payer engagement, forecast confirmation, some of the commercial build on internal infrastructure. But we're taking a very gated spend. I think you could see in our SG&A line, we are going to be conservative and gated as we get more data within the program, but we'll make sure that we're ready for the market as we're enthusiastic about the opportunity.

Maury Raycroft (Analyst)

Great. Thanks for the clarity. And just another quick follow-up. So EBS announced the execution of contract options for $67.4 million to acquire Tembexa for national preparedness efforts. And they also announced yesterday that they'll conduct clinical trials with Tembexa for monkeypox in Africa. So how much of that total contract value would Chimerix be eligible to receive, and what will be the timing for receiving that milestone? Do you have any insight into how the monkeypox outbreak has affected the U.S. government's initiative to stockpile Tembexa for smallpox?

Mike Andriole (President, CEO, and Director)

Thanks for the question. Let me take the monkeypox part of that question, and then I'll ask Michelle to answer the first part on the partial exercise of $67 million. From a monkeypox perspective, yes. Emergent did announce participation in a randomized monkeypox study at the end of business yesterday. They're best positioned to answer questions on that. That is an ongoing new study to explore Tembexa's utility in that population. We'll see how that unfolds in the coming years. That could lead to potential royalties to Chimerix when and if there could be international sales associated with that indication, but of course, they're at the very beginning of that process now. Michelle, comments on the milestone?

Michelle LaSpaluto (CFO)

Yes. BARDA did exercise a partial exercise with Emergent for Tembexa, which was just over $67 million, and with that option, we are due approximately $2.7 million related to that exercise. However, due to accounting rules, we have to wait until the cash is received for that to be recorded, so hopefully, next quarter, we'll have a little bit more information on that.

Mike Andriole (President, CEO, and Director)

Yeah. And that exercise, I think, goes out to 2027, Michelle, so it's a multi-year exercise of a claim that's about or an option that's, I think, just over half of the value of that next option.

Michelle LaSpaluto (CFO)

That is correct, as our understanding.

Mike Andriole (President, CEO, and Director)

Yep.

Maury Raycroft (Analyst)

Great. Thank you so much for taking my questions.

Mike Andriole (President, CEO, and Director)

You're welcome.

Operator (participant)

Again, if you would like to ask a question, press the star and then the number one on your telephone keypad. All right. That concludes our question and answer session. I will now turn the conference back over to Mike Andriole for closing remarks.

Mike Andriole (President, CEO, and Director)

Thanks, Leonardo. Thank you, everyone, for your time this morning, and 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.