Cardiff Oncology - Q3 2023

Transcript

Operator (participant)

Welcome to the Cardiff Oncology Third Quarter 2023 financial results and corporate update Conference Call. At this time, all participants are in a listen-only mode. Following management's prepared remarks, we will hold a Q&A session. To ensure that we have ample time to address everyone's questions during the Q&A session, we would ask for a limit of one question and one follow-up question per person. To ask a question at that time, please press star followed by 11 on your touchtone phone. As a reminder, this call is being recorded today, November 2, 2023. I would now like to turn the conference call over to Kiki Patel of Gilmartin Group. Please go ahead.

Kiki Patel (Principal, Investor Relations & Strategic Advisory)

Thank you, operator. Joining us on the call today from Cardiff Oncology, our Chief Executive Officer, Mark Erlander, and Chief Financial Officer, James Levine. During this conference call, management will make forward-looking statements, including without limitation, statements related to guidance, results, and the timing of data readouts for onvansertib clinical trials. These forward-looking statements are based on the company's current expectations and inherently involve significant risks and uncertainties. Our actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties. Factors that could cause results to be different from these statements include factors the company describes in the section titled "Risk Factors" in our annual report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 2, 2023.

Cardiff Oncology undertakes no duty or obligation to update any forward-looking statements as a result of new information, future events, or changes in its expectations. Slides for today's investor call can be found on the Homepage and Events and Presentations tab on the Cardiff Oncology website at www.cardiffoncology.com. With that, I'll turn the call over to Chief Executive Officer, Mark Erlander. Mark?

Mark Erlander (CEO)

Thank you, Kiki, and good afternoon, everyone, and thank you for joining our third quarter 2023 financial results and the corporate update conference call. As you can see on slide three, this past quarter was transformational for Cardiff Oncology. In August, we announced strong new data from our lead program in KRAS mutated metastatic colorectal cancer, the conclusions from a highly supported meeting with the FDA, and an expansion of our relationship with Pfizer. Then in September, we released data with two earlier-stage programs in pancreatic cancer and small cell lung cancer, which included a clear efficacy signal for onvansertib monotherapy in both indications. Today, we would like to put all of this in context and explain our strategy to you all and demonstrate how we can create shareholder value going forward.

You know, as we all know, these are challenging times for publicly listed biotech companies, but Cardiff Oncology has a collection of strengths from which to build value. As we list on slide four, these include, first and foremost, our drug, onvansertib, has shown clear signals of efficacy and tolerability in combination with chemotherapies and as a single agent in our clinical trials across multiple indications. Second, onvansertib is the only PLK1 specific inhibitor in clinical development, meaning onvansertib is the first-in-class molecule for this well-understood target for cancer therapies. Third, onvansertib can combine synergistically with, and is well tolerated in, many first-line and second-line standard of care regimens. This enables us to address some of the most common and deadliest cancer indications in early lines of therapy, where there are the large patient populations that could be positively impacted.

The fact that we are targeting first-line patients in both metastatic colorectal cancer and pancreatic cancer are good examples of this. Fourth, we have clear third-party support for our plans, and this includes the FDA and Pfizer. Finally, we have the financial resources to pursue our strategy in a thoughtful and methodical manner with a cash runway into 2025. As we go to slide five, we show three objectives for Cardiff Oncology that we believe will create value for all of our stakeholders. Let me be very clear, our primary focus is our lead program in RAS-mutated metastatic colorectal cancer. We are currently working closely with Pfizer Ignite to execute the clinical development plan that the FDA has agreed to, and to generate data from our first-line Cardiff 004 clinical trial in mid-2024.

Our second objective is to continue to generate additional clinical data from our trials in pancreatic cancer, small cell lung cancer, and triple-negative breast cancer, which we plan to do in a capital-efficient manner through investigator-initiated trials. Finally, our third objective is rooted in our conviction that PLK-1 inhibition has an even larger role to play in cancer therapy. As we have for other clinical programs, we will make data-driven decisions... with strong commercial logic to explore new promising combinations and cancer indications. Our current efforts focus on cost-effective preclinical studies. By executing towards these objectives, we can create significant value for all of our stakeholders, and we believe the data and the plans we announced in the third quarter, from a shareholder perspective, reduce the risk of our clinical development plan while increasing the reward potential, given the larger commercial opportunity that we are now pursuing.

Let's move to slide six. Here, we're summarizing the key accomplishments during the third quarter of our lead program in metastatic colorectal cancer. As you know, in August, we shared a series of findings from our second-line phase I-B/II clinical trial in KRAS-mutated metastatic colorectal cancer. About a quarter of the patients who came into our second-line trial were not treated with bevacizumab or bev in their prior first-line treatment. For this bev-naive patient, we saw strong responses to the combination of our drug onvansertib with the second-line standard of care, which includes bev. Specifically, 73% of bev-naive patients had a confirmed objective response to treatment versus historical controls that had demonstrated a rate around 25%. These patients also remained on our trial for a median time of 15 months before their disease progressed, versus historical controls of seven-eight months.

We were highly encouraged by these data, which suggested that there was a new mechanism of action of onvansertib at play that was previously unknown. Observing a threefold increase in response rate, a doubling in the median PFS in bev-naive patients, was a signal too strong for us to ignore. So as a next step, we investigated the underlying science through a 12-month, multi-phase preclinical program. The preclinical work led us to conclude that both onvansertib and bev have independent mechanisms of action that work together to restrict a tumor's blood supply, thereby significantly decreasing tumor growth.

We next asked, "Why is this clinical finding only observed in bev-naive patients and not in patients who were treated with bev in the bev in the first-line setting?" To answer this question, we engaged an independent research firm called Tempus to conduct a clinical study that analyzed tumor biopsy data from 135 KRAS-mutated metastatic colorectal cancer patients. This analysis showed that once patients were exposed to bev in the first-line setting, their tumor genomics were changed, and this change is consistent with generating tumor resistance to onvansertib and bev in the second-line setting. We believe this explains why we observed strong positive clinical results in our phase I-B/II trial in the bev-naive, but not the bev-exposed patient populations.

Now, armed with these findings, we shared our clinical and preclinical data with the FDA in a Type C meeting in June of this year. The FDA suggested we move our clinical development program of onvansertib up to the first line, where all patients are bev-naive and where we have the opportunity to positively impact the largest patient population of RAS-mutated metastatic colorectal cancer. We responded to the FDA's suggestion by proposing a development plan with two clinical trials. The first trial, CRDF-004, will provide randomized data for both efficacy and dose confirmation. Then we can conduct a subsequent registrational trial, CRDF-005, where the FDA provided clear guidance for a path to both accelerated approval and full approval from one trial.

Finally, we shared the full data package and FDA conclusions with members of our scientific advisory board, which includes a representative from Pfizer. As you know, Pfizer initially invested in Cardiff Oncology two years ago. Having seen full development of the clinical, preclinical, and FDA response I just described, they proposed to us that Pfizer Ignite conduct the CRDF-004 first-line clinical trial. Now, every partnership that Pfizer Ignite considers undergoes close internal scrutiny by the Chief Scientific Officer, along with other key scientific team members at Pfizer. They gauge the potential of each project, ensuring collaborations are mutually beneficial and align with Pfizer's broader goals. As we announced in August, our new relationship with Pfizer Ignite allows us to leverage their clinical development horsepower to execute our CRDF-004 clinical trial, while importantly, Cardiff Oncology maintains full economic ownership and control of onvansertib.

This month, November, the first group of our planned 30 clinical trial sites across the United States for CRDF-004 will be open to enrollment. We anticipate enrolling patients shortly thereafter and plan to report preliminary results in the middle of next year. With this, I'd like to turn now to our earlier stage programs, which are highlighted on slide seven. In September, we announced signals of efficacy in metastatic pancreatic cancer from two clinical trials, which support our planned path forward in the first-line setting. The first trial, CRDF-001, as you know, evaluates onvansertib's efficacy and tolerability in the second-line setting of pancreatic ductal adenocarcinoma or metastatic PDAC. From CRDF-001, we reported four of our 21 patients, or 19%, achieved an objective partial response or PR.

As of the data cutoff of September 13, 2023, three of the four patients with PRs were still awaiting their confirmatory scans. As of today, November 2, one of these three patients, patient 42, has now shown a further deepening of response at their four-month scan, therefore representing a second confirmed PR on this trial. We are still awaiting confirmatory scans for the remaining two patients with an unconfirmed PR who remain on treatment, one for now eight months and another for over nine months. This is much longer than historical median progression-free survival of 3.1 months for second-line. Overall, for all evaluable patients, we reported a median progression-free survival of five months, which is encouraging since this approaches the benchmark of the first-line median PFS, which is 5.5 months, indicating yet another strong signal of efficacy in this indication.

The second trial in pancreatic cancer is an investigator-initiated biomarker discovery trial in metastatic PDAC, where onvansertib's effect on tumors is being evaluated as a single agent. As you recall from our last call, the data we presented in September showed effects on tumor biomarkers with onvansertib monotherapy after only 10 days of treatment. Because of these encouraging results that we observed to date with onvansertib from both trials, we plan to move to the first-line setting through a new investigator-initiated trial to be conducted at the Oregon Health & Science University Knight Cancer Institute. This first-line design enables us to potentially have the greatest opportunity to impact these challenging diseases at an earliest possible stage, when the chances of patients responding to treatment are the highest. Finally, and important, this approach allows us to generate data in a capital-efficient manner.

In September, we also presented the first look at data from an investigator-initiated trial in refractory extensive-stage small cell lung cancer. The trial treats patients with onvansertib monotherapy and is being conducted at the University of Pittsburgh Medical Center. Of the first seven patients that have been treated as of September 26, 2023, one had a confirmed partial response, three stable disease, and three progressive disease. Seeing a confirmed partial response, which the investigator assessed as a 50% shrinkage of the tumor from treatment with onvansertib monotherapy, provides a clear signal of onvansertib's efficacy in this challenging disease. Our current plans are to continue enrollment in this trial, but as we reported in September, our expectation is that a future clinical path forward in small cell lung cancer is most likely to include a combination regimen of onvansertib with second-line standard of care paclitaxel.

Finally, the investigator-initiated trial in triple-negative breast cancer continues to enroll, and we'll provide data from that trial when it becomes available. Okay, so, so far I've discussed our ongoing programs and plans, but our third objective to create value for our stakeholders is to investigate new therapeutic indications for onvansertib. For example, the recent discovery of the power of the onvansertib bev combination indicates that we should aggressively explore, through preclinical models, indications where bev is FDA approved. This includes RAS wild-type colorectal cancer, lung, liver, kidney, cervical, and ovarian cancer. We also know that onvansertib is antimitotic, given that PLK1 plays a critical role in cellular mitosis, which is the process through which a cancer cell divides from one cell to two.

There is extensive literature suggesting the combination of two antimitotic agents could be synergistic, and we have been exploring this combination in preclinical models with dramatic results. To give one example, I will share some new preclinical data for hormone receptor-positive, or HR-positive, breast cancer. These results are shown on slide eight. Breast cancer is the most common form of cancer diagnosed today in the United States, and hormone receptor, or HR-positive, breast cancer represents about 80% of breast cancer cases. In metastatic HR-positive breast cancer, tumor cells can develop resistance to first-line treatment, in part by overexpressing PLK1. Paclitaxel, an antimitotic agent, is a common second-agent therapy, making it an ideal drug to explore in combination with onvansertib in this setting.

The data on slide six shows how treatment with onvansertib, paclitaxel, and the two agents combined impact patient-derived xenograft models resistant to first-line treatment with palbociclib in HR-positive breast cancer. We observed highly significant tumor regression with the combination, with over 50% of the tumors within each model having a complete response to the combination treatment. As we look at this here at Cardiff Oncology, we believe this data support our broader vision for onvansertib, and we remain committed to a cost-effective approach using preclinical models to validate additional indications and combinations. Now, I will turn it over to our CFO, James Levine, to go over the financial results for the third quarter, 2023. James?

James Levine (CFO)

Thank you, Mark. Earlier today, we issued a press release summarizing our financial results for the third quarter, and on slide nine, we share the financial highlights. You can also find additional information in our Form 10-Q for the third quarter, filed with the SEC earlier today. Turning to our balance sheet, cash and short-term investments as of September 30, 2023, totaled $81.4 million, and net cash used in operating activities for the third quarter of 2023 was approximately $8 million. Based on our current expectations and projections, we believe our cash resources are sufficient to fund operations into 2025. With that, I'll turn the call back over to Mark.

Mark Erlander (CEO)

Well, thank you. Thank you, Jamie. As we close today, you can see from the data we have generated to date, we here at Cardiff Oncology truly believe we have a pipeline and a product, and we have found highly capital-efficient ways to explore these efficacy signals. And with data expected mid-next year from our first-line RAS-mutated metastatic colorectal cancer trial, we have an important near-term catalyst from our lead program. So while we recognize the challenges facing the broader biotech industry, we believe that the strength of our data, the clarity and support we received from our recent FDA meeting, our expansion of our relationship with Pfizer, and our strong financial position, clearly show that Cardiff Oncology has the potential to create enormous value for our stakeholders, including our shareholders, and most importantly, the patients we intend to serve.

With that, I will now open the call up for questions. Operator?

Operator (participant)

As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Our first question comes from the line of Marc Frahm from TD Cowen.

Marc Frahm (Biotechnology Equity Research Analyst)

Thanks for taking my questions. Maybe first on the clinical side, just at the last update, there were three unconfirmed PDAC responses. Just I'm not sure if maybe some of those patients have had a chance to have a confirmatory scan in the last month or two, and if, if so, were any of them able to confirm? And then on the finance side, maybe Jamie, can you just talk through kind of the expense trajectory here as the first-line trial and colorectal starts to ramp up, and some of these other ICTs? I know that's not a big lift on your part, but just as some of those start up as well.

Mark Erlander (CEO)

Okay. Well, thanks, Marc, for your question. So regarding the CRDF-001 PDAC trial, as you stated, we had four PRs that we announced, with one being confirmed on our September call. What we're announcing today is continuing and following these patients, and now we have a second patient who had a deepening response and confirmed now has a confirmed PR. We have two remaining patients who have not had their next scan. One's been on treatment for eight months, another's been on treatment for over nine months. And so, you know, we plan at some date in the future, we will update that trial, but that's where we stand today. And I'll now turn it to Jamie to... Unless, Marc, there's any more clarity you need on that.

Marc Frahm (Biotechnology Equity Research Analyst)

No, no, that's very helpful. Thanks.

James Levine (CFO)

So, Marc, from an expense trajectory, what we'd say is we have a few trials that are actually going to be winding down. As we've talked about our plans in MCRC, the phase I-B/II trial is going to be winding down. We're also shifting away from our second-line PDAC trial into the first-line IIT that Marc talked about earlier on the call. So that's happening at the same time as we are ramping up our CRDF-004 trial. So when we look at our overall expenses, our net expenses going forward, we do expect that they're going to increase, but not significantly. And I think when you put that together with the $81 million we have at the end of the third quarter-

Mark Erlander (CEO)

... You know, you can see once again, we burned $8 million this quarter. That's in line with where we've been in the past, and so that is the basis on which we make the statement that our current cash extends into 2025.

Joe Catanzaro (Director and Senior Biotech Equity Analyst)

Great, thanks. Very helpful.

Mark Erlander (CEO)

Sure.

Operator (participant)

One moment for our next question. Our next question comes from the line of Joe Catanzaro from Piper Sandler.

Joe Catanzaro (Director and Senior Biotech Equity Analyst)

Hey, everybody, appreciate you taking my questions. Maybe just a couple from me on the 004 study. Would love to just sort of get your sense around your level of confidence or around being able to generate these interim data by mid-2024, given dosing hasn't started yet. I'm wondering if you have any internal projections on how quickly you can enroll these planned 90 patients. And then, have you said whether this data readout is triggered by a specific number of patients reaching a specific amount of follow-up? Any details there would be helpful. Thanks.

Mark Erlander (CEO)

Well, hi, Joe. Yes, you know, we remain very bullish in being able to put out the first interim data or preliminary data from the trial. You know, as you know, we are working very closely with Pfizer Ignite, and Pfizer Ignite, we're very pleased because Pfizer Ignite is actually conducting and implementing and executing the Cardiff 004 randomized trial. We are going off of where those projections are, and we do believe that we will be able to have data to talk about. Now, keep in mind, we'll be watching the trial. It's a, you know, the trial itself is an open label trial, so we'll be able to watch the progress of that as we start to enroll patients.

We do remain confident to be able to give information sometime mid-next year.

Joe Catanzaro (Director and Senior Biotech Equity Analyst)

Okay, that's helpful. And then in terms of the actual sort of data readout, my follow-up there was whether that's triggered by something formally in the protocol as it relates to sort of number of patients and the amount of follow-up.

Mark Erlander (CEO)

No, it's not. It's really we're watching as it's open label, so it's gonna depend on the magnitude of the effect that we do see. So, but there is no trigger in the protocol.

Joe Catanzaro (Director and Senior Biotech Equity Analyst)

Okay, got it. That's, that's very helpful. Thanks for taking my question.

Mark Erlander (CEO)

Sure. Thanks, Joe.

Operator (participant)

Thank you. One moment for our next question. Our next question comes on the line of Andy Hsieh from William Blair.

Andy Hsieh (Senior Research Analyst, Biotechnology)

Great, yeah, thanks for taking my questions, and congratulations on all the progress. Two questions, if you don't mind. One has to do with, Mark, I believe, when you were conducting the phase I-B/2 study before, there was a strategy employed to kind of minimize the adverse event from kind of like a switching between bolus 5-FU and infusional 5-FU. I'm just curious if that strategy is also being employed in 004 and 005. And then love to hear, obviously with, you know, this expanded pipeline development plan, love to hear your thoughts on the IP strategy in terms of market exclusivity. Thank you.

Mark Erlander (CEO)

Okay, well, the first question, Andy, regarding the bolus, we're continuing to have that be an optional for the treatment arms. And but in the control arm, the FDA has asked that they consider to be standard care to have the 5-FU bolus. So, but we'll continue to do what we've done in the phase I-B/2 trial. Your second question, maybe Andy, maybe you could repeat that again, just so I make sure I answer that correctly.

Operator (participant)

Thank you. At this time, I would now like to turn the conference back over to Mark Erlander for closing remarks.

Mark Erlander (CEO)

Well, thank you all for your time, and, this concludes our conference call. And, thank you once again, for joining us this afternoon.

Operator (participant)

This concludes today's conference call. Thank you for participating. You may now disconnect.