Kymera Therapeutics - Q1 2024
May 2, 2024
Transcript
Operator (participant)
Good day, and welcome to the Kymera Therapeutics First Quarter 2024 Results Conference Call. All participants will be in the listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touchtone phone. To withdraw your question, please press star, then two. Please note that this event is being recorded. I would now like to turn the conference over to Justine Koenigsberg. Please go ahead.
Justine Koenigsberg (Head of Investor Relations)
Thank you. Good morning, and welcome to Kymera's quarterly update call. Joining me this morning are Nello Mainolfi, President and CEO, Jared Gollob, our Chief Medical Officer, and Bruce Jacobs, our Chief Financial Officer. Following our prepared remarks, we will open the call to questions. To have enough time to address everyone's questions, we ask that you please limit your questions to one and a relevant follow-up. Before we begin, I would like to remind you that today's discussion will include forward-looking statements about our future expectations, plans, and prospects. These statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected. A description of these risks can be found in our most recent 10-Q filed with the SEC. Any forward-looking statements speak only as of today's date, and we assume no obligation to update any forward-looking statements made on today's call.
With that, I'll now turn the call over to Nello.
Nello Mainolfi (CEO)
Thank you, Justine. Good morning, everybody. It's been a very productive beginning of 2024, starting in January with an extensive update at our Immunology R&D Day and a subsequent financing to provide capital that we will invest in our expanding clinical development efforts and growing pipeline. Past quarter has been focused on execution on both our preclinical and clinical pipeline, as well as external engagement across a variety of business and medical conferences. Today, our plan is to share a brief update on our programs, as well as timelines for news and catalysts we're expecting through the rest of this year and early 2025. As we shared earlier this year, we believe we have a significant opportunity to address and expand the existing treatment paradigms within immunology by developing compelling oral small molecule degrader medicine with biologics-like activity.
As has been the case all the way back to the founding of the company, we have taken a differentiated approach to target selection and focused on critical molecular pathways that are well-validated through human genetics, clinical evidence, and/or the success of approved drugs. Many of these pathways play a key role in immune-mediated disease pathology, and while injectable biologics dominate these markets, often due to their strong clinical activity, they're not without limitations, which in many instances can limit penetration. As a result, we believe developing convenient oral options with biologics like activity and a good safety profile represents an enormous opportunity to expand patients' access in many of these markets that are currently dominated by injectable agents. Our IRAK4 program, which was our first program to enter clinical development, exemplifies a target and a pathway that has the potential for a broad patient impact.
We have talked in the past about our reasons for enthusiasm around IRAK4 as a target and our rationale for pursuing it. IRAK4 is an obligate node in the IL-1R/TLR signaling, and we believe its degradation is the only approach to fully block the pathway, creating multiple development opportunities in large, high unmet need indications. In the KT-474 IRAK4 phase I trial, we observed deep and well-tolerated degradation, early signs of clinical efficacy, and high fidelity of translation from preclinical models to patients, which provide key insights for our growing immunology pipeline and position future programs such as our STAT6 and TYK2 degrader programs for success. In March, we had the opportunity to showcase our proprietary immunology programs, KT-621, our STAT6 degrader, and KT-294, our TYK2 degrader, at the American Academy of Dermatology annual meeting.
The poster presentations, which marked the first data from a STAT6-targeted agent and a TYK2 degrader to be shared at a major medical meeting, highlighted our robust preclinical packages and support the significant potential of our oral degraders in these pathways. In our KT-621 AAD poster, we highlighted the preclinical efficacy studies comparing KT-621 to dupilumab in a preclinical atopic dermatitis model. Importantly, KT-621 showed robust activity in vivo in this model, equal or superior to dupilumab. KT-621's degradation of STAT6 was well tolerated in multiple preclinical safety studies at dosage concentration up to 40-fold above the projected human efficacious concentrations.
If we can indeed deliver biologics-like activity, a good safety profile at oral once daily dosing, we believe KT-621 could change the treatment paradigm of millions of patients suffering from Th2-driven inflammation. In terms of timing, KT-621 is currently in IND-enabling studies and is on track to enter phase I testing in the second half of 2024. It's our intent to conduct a phase I healthy volunteer study to assess single and multiple ascending doses of KT-621 and move quickly from there into patients. We have finalized our clinical development plan and strategy, and we look forward to sharing more details as we move closer into clinical development.
Moving to take two, we shared a poster at AAP that demonstrated picomolar degradation, potency and low nanomolar inhibition of the IL-23, IL-12, and type 1 interferon pathways, showing KT-294's potential to recapitulate the biology of human TYK2 loss-of-function mutations. The biological differentiation of KT-294 from allosteric TYK2 small molecule inhibitors was demonstrated through IL-10 sparing compared to dupilumab, which is important in inflammatory bowel syndrome, as well as was shown through superior inhibition of type 1 interferon pathway compared to TAK-279, which is relevant for the treatment of several diseases, including interferon-driven diseases. Additionally, KT-294 demonstrated deep and sustained TYK2 knockdown in vivo with low daily oral doses. We believe that this data demonstrates that a TYK2 degrader has the potential to deliver best-in-class TYK2 pathway blockade with broad activity across multiple IL-12, IL-23, and type 1 interferon-driven immune inflammatory diseases.
We intend to continue to share updates across our pipeline in medical meetings in 2024. In fact, later this month, we present poster highlighting KT-621 and its potential to treat Th2 allergic diseases at both the American Thoracic Society International Conference in San Diego, as well as at the Digestive Disease Week in D.C. These presentations, which build on what was previously shared at R&D Day, will include new, exciting, additional pre-clinical data. To sum up my intro here, since our founding eight years ago, a milestone which we will commemorate just in a few days, we have demonstrated consistent and scalable innovation, including strongly clinical to clinical translation of degradation, safety, and activity across our whole pipeline. We have also achieved early proof of concept in both immunology and oncology, which we believe is a significant accomplishment for the new modality.
As we are transitioning from early to mid-late development across our pipeline, we remain committed to building on our early success and expanding our team and capabilities to deliver on the substantial clinical and commercial opportunities that our programs offer, to ultimately become a global commercial-stage medicine company. In the meantime, we look forward to important near-term data readouts in this year in oncology and multiple readouts from our immunology pipeline in 2025. I'll pause here, and ask Jared to provide an update on our clinical program. Jared?
Jared Gollob (CMO)
Thanks, Noah. I'll round out the immunology discussion this morning with IRAK4, and then give an update on our two clinical oncology programs. Our first-in-class oral IRAK4 degrader, KT474, is progressing in two phase II trials in hidradenitis suppurativa and atopic dermatitis. These trials are being conducted by Sanofi under our collaboration, and we expect to be in a position to share top-line data in the first half of 2025. Recall that Sanofi moved this program into phase II studies based on the early clinical data we generated in HS and AD patients in phase I trial. In that study, not only did we achieve our study objectives in terms of PK, PD, and safety, but we also delivered encouraging signs of clinical activity that we will also evaluate over a longer dosing period in the phase II trials.
These randomized, placebo-controlled trials represent an opportunity to demonstrate the potential for IRAK4 degradation generally, and KT-474 specifically, to transform the treatment of complex inflammatory diseases and to offer HS and AD patients a well-tolerated, effective, and convenient oral medicine. Switching gears now to oncology. I'll start by noting that we recently presented scientific data on our oncology pipeline in both a late-breaking poster session and during the major symposium at the AACR annual meeting. As we shared in the past, our preclinical and early clinical findings, highlighted last month at the meeting, support the advantages of degraders over other existing technologies and agents, and further validate our differentiated molecular design, target selection, and translational strategies to advance a new generation of medicines for patients.
KT253, our highly potent degrader of MDM2, an E3 ligase that modulates the most common tumor suppressor, p53, is currently in development for the treatment of liquid and solid tumors. Preliminary data from the phase I clinical trial showed evidence of target engagement and p53 pathway activation, along with initial signs of antitumor activity without dose-limiting toxicities, including typical hematological toxicity. These findings support our therapeutic hypothesis for MDM2 degraders and the potential to improve the therapeutic index compared to MDM2 small molecule inhibitors. As we finish dose escalation in the phase I trial this year, we hope to see antitumor activity in a variety of tumor types, and coupled with our biomarker selection strategy, we plan to assess these data collectively to inform next steps.
Finally, on MDM2, we are announcing today that we've had an abstract accepted for a poster presentation at ASCO in June, where we will provide a clinical data update. Once the trial is completed, we expect to present the full data set at a medical meeting later in the year. KT-333, our highly selective degrader of STAT3, a traditionally undrugged transcription factor recognized as a key component of the JAK-STAT signaling pathway with both tumor cell intrinsic and tumor cell extrinsic effects on the tumor microenvironment, is currently in development for the treatment of multiple STAT3-dependent pathologies, including hematological malignancies and solid tumors. Preliminary data from the phase I trial demonstrated early signs of antitumor activity at doses that were generally well-tolerated and associated with substantial STAT3 knockdown in blood and tumor. Our preclinical to clinical translation showed some early but encouraging responses in both CTCL and Hodgkin's lymphoma.
We also demonstrated stimulation of an interferon gamma response in tumor and blood, which is encouraging, given the correlation between interferon gamma and how tumors respond to anti-PD-1 drugs. Dose escalation in the KT-333 phase I study is ongoing, with the goal to further assess safety and antitumor activity in both liquid and solid tumors. We expect to complete the study this year and deliver additional proof of concept data to define KT-333's path to late-stage development. We are also announcing that we've had an abstract accepted for presentation at the European Hematology Association, or EHA Meeting in June, where we will present a clinical update. We plan to present the full data set at a medical meeting later in the year. Now I'll hand the call over to Bruce to share financials for the quarter. Bruce?
Bruce Jacobs (CFO)
Thanks, Jared. I'll quickly review our first quarter 2024 financial highlights, and you can certainly reference the tables found in today's press release. Revenue in the quarter, the first quarter of 2024, was $10.3 million. All of that was attributable to our Sanofi collaboration. And just as a quick reminder, we had received or have received $55 million in total milestones as a result of the start of the two phase II trials in the fourth quarter of last year. With respect to operating expenses, R&D for the quarter was $48.8 million. About $6.1 million of that represented non-cash stock-based comp, resulting in an adjusted cash R&D spend of $42.7 million, a 10% decrease from the comparable amount in the fourth quarter of 2023.
On the GA side, our spending for the quarter was $14.4 million, of which $5.9 million was stock-based comp. The adjusted cash GA spend of $8.5 million, again, excluding the stock-based comp, reflects a 1% decrease from the comparable quarter, sequential quarter. Our cash balance at the end of the first quarter was $745 million. In January, as we mentioned, we realized approximately $300 million in net proceeds from our equity offering, and our cash balance is expected to provide a runway into the first quarter of 2027, and that will enable us to execute on multiple, or I should say, the first half of 2027.
That will enable us to execute on multiple data readouts, including oncology proof of concept results in 2024, KT-474 phase II data expected in the first half of 2025, and several clinical inflection points for our STAT6 and TYK2 programs also in 2025. So this concludes our prepared remarks. We'd be happy to take your questions. Operator, if you could open the line for questions. Thank you.
Operator (participant)
Thank you. We will now begin the question-and-answer session. To ask a question, you may press star, then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two. At this time, we will pause momentarily to assemble our roster. The first question is from the line of Brad Canino from Stifel. Please go ahead.
Brad Canino (Analyst)
Great. Thanks so much for the question. It looks like we're gonna get two bites out of the apple for MDM2 this year. And generally, I would assume that the completed one A and the biomarker data later this year would be most material. So just to not overlook what's coming at ASCO, can I have you talk about the decision to present here? What should be the focus, and how should investors view it within the broader trial and strategy for the asset? Thank you.
Nello Mainolfi (CEO)
So thanks, Brad. So just, you know, taking a step back, this is a program that we started clinical development in the second half, roughly in the middle of last year. And our first update was at our quarterly call in November, if you recall, of last year, and we presented really limited data.
As we since then recruited many more patients in the solid tumor lymphoma arm, as well as opened the AML arm, we thought it was important to connect with the medical community and obviously the investor community, to give an update on the progress we've made in both arms of the trial, that I believe will shine more light on the potentials of MDM2 across this subset of patients, and also create more enthusiasm, hopefully, if we can to continue to recruit the right type of patients to our studies. So, obviously, when we share data, there are multiple audiences, and the investor community being one of them.
But the goal is to complete, as we said in the press release, this phase I dose-escalation study by the end of the year, and then, yes, provide a full update, as well as plans for further development later in the year. But given the substantial depth of patients recruited between November and now, we thought this would be a good update to showcase the progress of the program.
Brad Canino (Analyst)
Okay, thanks for that. And then, Nello, I know you took part in a targeted protein degradation symposium at AACR. I'd just love to hear what your general insights were, thoughts were exiting that about the evolution of this therapeutic area. Thank you.
Nello Mainolfi (CEO)
Yeah, that's a great question, Brad. So, first, it was a great meeting. I believe I saw you there. It was a very well-attended, let's call it, symposium, with, you know, many companies presenting. I actually hadn't been in a TPD-focused symposium in probably too long, and so it was great to see a huge amount of interest from many stakeholders in the space. I saw many physicians. I saw other small and large companies. So I think the level of interest is increasing with the data, especially clinical data that different companies are sharing. I also came home with a, you know, great feeling that, you know, companies like Kymera are really, you know, leading the field here in terms of capabilities, target selection, sophistication of approach.
I think generally there's still a lot of work to do for the field, but, you know, I'm glad that we and others are leading and providing hopefully good examples for others to follow.
Operator (participant)
Thank you. We move to the next question. The next question is from the line of Eliana Merle from UBS. Please go ahead.
Speaker 16
Hey, it's Sam on for Ellie. I guess just in line with the previous question, from the MDM2 update at ASCO, can you provide any color on, I guess, like, the extent of data that we could be expecting from the study? And, I guess what kind of efficacy measures we should anticipate to look for, and what are you guys looking for from the data as you think about the development path forward?
Jared Gollob (CMO)
Hey, great, thanks for the question. I mean, this is really planned to be a clinical update for the phase Ia dose escalation, so really to show the progress that we've made since last November. So you know, the goal here is to share additional information on the types of patients we've enrolled, you know, both solid tumor patients, as well as patients with hematologic malignancies. To share the safety that we've been seeing as we've been dose escalating, to share more data on the pharmacodynamic effect of the drug. Recall that back in November, we did show an impact on GDF-15, which is this key biomarker just downstream of MDM2.
Our aim is to show more data that provides that sort of information on pharmacologic engagement, and of course, to provide whatever response data we have, clinical response data we have for patients with solid tumors and patients with hematologic malignancies.
Speaker 16
Okay, great. Thank you so much. I guess just a quick follow-up. Just any color on the updates for the biomarker patient selection strategy you guys are pursuing, and how is the progress kind of going there?
Jared Gollob (CMO)
Yeah, I think that's an important question, and I think Nello mentioned that earlier, which is an important part of the program for MDM2, in addition to being able to demonstrate that the therapeutic index with our degrader is superior to what's been seen with MDM2 inhibitors. Is to eventually be able to, you know, evolve a sort of patient selection strategy or so-called sort of biomarker strategy for selecting patients who we think will be most sensitive to this treatment.
We don't plan on providing that particular update at ASCO, but our anticipation is that later in the year, you know, preferably at a medical meeting, we provide more of those data showing our progress, you know, pre-clinically and even perhaps some of our clinical data that have been informing our ability to develop, you know, a patient selection biomarker strategy, focusing on those patients who we think we'll be able to predict would be most sensitive to MDM2 degradation.
Operator (participant)
Thank you. We move to the next question. The next question is from the line of Michael Schmidt from Guggenheim Securities. Please go ahead.
Yike Dai (Analyst)
Oh, hey, good morning. This is Yike Dai for Michael Schmidt. We want to get your thoughts on recent Rinvoq data that showed superiority over Dupixent. As you think about the opportunity for your IRAK4 and STAT6 degraders, do the level of results shift the bar for an oral agent in AD and potential other indications? And, as a related question, what's your strategy on future head-to-head studies against biologics for your overall I&I portfolio? Thank you.
Nello Mainolfi (CEO)
Yeah, it's a great question. So I don't think we've learned today that inhibiting JAK kinases is an extremely powerful anti-inflammatory mechanism. In fact, I think if you look across several indications, not only in AD, you see JAK inhibitors being extremely, extremely active. So I don't believe we learned anything new. I think what we are, what we are proposing here at Kymera is to use protein degradation to go after targets that provide the best efficacy to safety profile. So the opportunity here is to have an oral drug that is well tolerated, that does not require, you know, blood monitoring or blood testing or monitoring of patients for severe cardiovascular events. So I don't think the bar is moved at all.
I think the field is still looking for oral agents that are active, that have a well-tolerated profile. And that's really what we're trying to do for both IRAK4 and STAT6, I think, in different way. Obviously, we can discuss each program individually.
Operator (participant)
Next question. Thank you. The next question is from the line of Eric Joseph from J.P. Morgan. Please go ahead.
Eric Joseph (Analyst)
Hi, good morning. Just wanted to get a little bit of a better sense of what your internal bar is for moving 253 into 4 later stage development. I wonder whether hem opportunities in hem malignancy are will be strategically attractive enough, or do you want something broader that encompasses solid tumors as well? And additionally is the focus more on moving forward with the monotherapy strategy, would you be amenable to combination approaches? Thanks.
Nello Mainolfi (CEO)
Yeah, thanks, Eric. Maybe I'll start and then pass it to Jared. So first, I would say the reason why we got involved with MDM2, which, as we all know, is a target that has been pursued by the industry in the past 15 years or so, is. So the reason for us to do so is to really unlock a broad variety of tumor types that we have seen are extremely sensitive to removal of MDM2, which is quite different, in our view, from inhibition of MDM2 p53 interaction that small molecule inhibitors do.
So as Jared was saying, we have developed a sensitivity map, let's say, across tumor types, that point to a subset of tumors in which we've seen preclinically, and, you know, we'll start sharing some clinical data, but we've seen preclinically, I can say so far, to be extremely sensitive to this mechanism. And those go across both heme as well as solid tumors. I think we've shown already preclinically that AML, especially both as a single agent as well as combo, we've seen some really, really almost best-in-class activity. And, you know, this is an area that we would pursue independently of the opportunity in solid tumors, given the high unmet need and still the relevant commercial opportunity for both, you know, first line, but also for refractory AML.
So I think I would say that the AML opportunity is, in a way, independent from solid tumor, but I also would wanna say that the impetus to work on MDM2 was to go also beyond hemoncology. So we have hopefully exciting plans that we can share with you based on a biomarker strategy that see us expanding in solid as well.
Eric Joseph (Analyst)
Great. I appreciate it. Thanks for taking the question.
Operator (participant)
Thank you. The next question is from the line of Kalpit Patel from B. Riley. Please go ahead.
Speaker 14
Hi, this is Jeff for Kalpit. Thanks for taking my question. Just one on the STAT6 program. The question is, if you have the opportunity to discuss the development of your STAT6 degrader with Sanofi? If so, could you share any insight into why perhaps Sanofi opted to collaborate with another STAT6 degrader company instead? Thank you.
Nello Mainolfi (CEO)
Yeah. So, as we've said repeatedly in the past, I'll say this again today, we started this program a few years ago. We have built a conviction around our ability to use oral degraders in immunology, starting from early days in RF four, and we have decided that we have no interest in partnering our immunology pipeline at least in the foreseeable future, in order to fulfill our vision to building a global, integrated company. I'm not going to, you know, obviously, share discussions that we've had with Sanofi, but I would say generally, this is a program that has been pursued from other parties quite heavily in terms of potential partnerships.
But our communication has been very clear, that, you know, we, we believe this is a program that we want to develop as a standalone, independent company, for the foreseeable future. I will also remind everybody that, you know, we are the first company to take a STAT6 degrader. Actually, I would say STAT6 agent overall in the clinic, we're the first company to demonstrate the preclinical activity of such an agent. And, you know, everybody else is obviously, you know, years behind us.
Speaker 14
Okay. Thank you. That's very helpful.
Operator (participant)
Thank you. The next question is from the line of Andy Chen from Wolfe Research. Please go ahead.
Andy Chen (Analyst)
Hi, good morning. Thank you for taking the question. Two related questions, also on STAT6. Just curious if you can talk about tissue distribution. And so I see deep degradation in the skin in non-human primates. I'm just curious how well this tissue distribution translates to humans. I'm curious if you can cite several precedents where this non-human primate distribution is highly correlated to humans. And also in the first half of 2025, are we gonna gain any insight on this exact topic? What kind of metrics will we have when determining whether STAT6 is indeed acting on the skin in humans? Thank you.
Nello Mainolfi (CEO)
Yeah. No, it's, it's a great question. So, so first, you know, for people that have followed us over the past few years, know that we don't discuss preclinical data of PK and distribution besides the degradation data that we show in our presentations. And that's only because we believe those are highly, confidential and important data that, we wanna keep for, ourselves at this point. But I will say that if you look at the data we presented, we've shown that, KT-621 degrades STAT6 equally effectively in several tissues, in skin, in lung, in blood and I believe in spleen too. I'm not sure we've shown that or not. But, we've shown that, the distribution of the drug allows for, I would say, generally equivalent degradation across all Th2 relevant tissues.
Our expectation is to see in the clinic the same level of response. And we've seen good translation of preclinical into clinical in terms of distribution across different species. I would say that, yes, in the first half of 2025, our goal is to share phase I data, as it's been publicly disclosed, and the phase I data will involve both blood and skin biomarkers.
Jared Gollob (CMO)
Thank you.
Operator (participant)
Thank you. The next question is from the line of Derek Archila from Wells Fargo. Please go ahead.
Speaker 17
Hey, guys. Good morning. This is Evelyn for Derek. Thanks for taking our question. So a quick one from us, kind of like following up on the last question. On the STAT6 phase I study, will you be including a cohort of patients to achieve this proof of concept, kind of like how you did with, like, 474? Or will this only be including, like, healthy volunteers? Thanks.
Nello Mainolfi (CEO)
Well, at this point, I think all we've said today was that the initial evaluation will be in healthy volunteers. We'll share more at a later date.
Speaker 17
Okay, thanks.
Operator (participant)
Thank you. The next question is from the line of Divya Rao with TD Cowen and Company. Please go ahead.
Divya Rao (Analyst)
Hi, guys. This is Divya. I'm for Marc. Thanks for taking our question. Similar to the earlier question, what is the scope of kind of the disclosure that we should get from KT-333 at EHA? And then as a follow-up, I guess, what do you need to see in this phase I trial, which I guess you're planning on completing at the end of the year, in liquid tumors to continue development in both liquid and solid tumors?
Nello Mainolfi (CEO)
Divya, I'll take the second, and I'll let Jared answer the first part of your question. So the second part was around what do we need to see? So as I said in the past also, you know, our bar for continuing investment is having meaningful opportunity with a clear path to a sizable patient population with big clinical and commercial impact. And so the obviously more obvious answer to your question is that, you know, solid tumor opportunities would be able to make a much easier case for further investment. As I've said in the past, we don't expect to see single-agent activity in solid tumor, as we haven't seen preclinically.
But we're evaluating the biomarker, the tumor biomarker, effect, to then tie with preclinical data that we've already demonstrated in this potential solid tumor combo opportunities. So that is one. And then obviously, having strong antitumor activity as a single agent in liquid tumor is important for two reasons. One, because there are potential liquid tumor opportunities that are sizable enough to be interesting, but also to confirm that the drug is active and is, you know, worthwhile further investment in expanding the opportunity. Jared, do you want to comment a bit on the expectations for EHA?
Jared Gollob (CMO)
Sure. If you recall back at ASH this past December, we presented data on 29 patients that we had enrolled so far, and we showed very encouraging safety data, which was allowing us to continue to dose escalate. We showed very strong pharmacodynamic data, including strong STAT3 knockdown in blood and tumor, as well as strong immunomodulatory effects in blood and tumor, such as that interferon gamma response that was predictive of potential in combination with anti-PD-1. And we also showed these promising clinical responses in CTCL as well as in Hodgkin's lymphoma.
So the aim for the EHA presentation is really to build on that as we continue to dose escalate, to provide further data around safety as we've been dose escalating, to provide additional, you know, pharmacologic data on target knockdown and immunomodulation, you know, in blood and whatever we may have in tumor, and to provide additional clinical response data. Again, as you said, that this is meant to be a clinical update, and then the plan will be then later in the year, once we anticipate completing those escalation, to provide a final data dataset at a medical meeting later in 2024.
Divya Rao (Analyst)
Thank you.
Operator (participant)
Thank you. The next question is from the line of Thomas Smith from Leerink Partners. Please go ahead.
Speaker 15
Good morning. This is Niculin Suban for Thomas Smith. Thanks for taking the question. We have two, both in I and I. So the first one is, what's the gating factor to initiate a phase I trial for KT-621? And what data can we expect from the readout expected in first half 2025 to help prioritize the indications for the subsequent development in I&I indication?
Nello Mainolfi (CEO)
Okay, great. So, so as we've said on the call today and in the press release, so we're in IND-enabling studies, and, you know, we're gonna leave it at that. We don't usually provide a specific update on where exactly we are on the process. So, you know, obviously completing that phase, filing an IND and initiating phase I is what's between us and that. In terms of indication prioritization for STAT-6, I think the only thing I would say is, as we've said in the past also, we are focused on getting this drug to as many patients as possible, starting with large indications where we've seen injectables can really really have low penetration for many, many reasons.
So I would say we're prioritizing the larger indications, but that doesn't mean we will not pursue others. I think that will happen, but just in a probably different stage, phase, and manner.
Speaker 15
Got it. For the IRAK4 program, with data expected in the first half as well of next year, so know if you will make a decision of going forward or not, but you also have an opt-in decision. Like, how are you approaching the opt-in, and what do you need to see to make a decision?
Nello Mainolfi (CEO)
Yeah. So, after phase II, but before phase III, so a phase III needs to be in the planning stage when we will have the opportunity to decide to opt in or not. And, you know, the decision will be based on, you know, obvious reasons, the excitement we have around the opportunity with the drug, the investment that we have across our pipeline, the cash needs that will be needed across the investments, across our pipeline. I would say, maybe a bit naively, that, you know, the base case is if the drug is, is active as we expected it would be, it would be value accreting for us to opt in, and so it, it would be probably an easy decision to make.
As you know, it's hard to make decisions in a vacuum, so when we're there, we will make the decisions based on all the other parameters I mentioned.
Operator (participant)
Thank you.
Nello Mainolfi (CEO)
Thank you.
Operator (participant)
The next question is from the line of Vikram Purohit from Morgan Stanley. Please go ahead.
Vikram Purohit (Analyst)
Hi, good morning. Thanks for taking our questions. So we also had a couple of questions on 474. Apologies if you mentioned this in your prior Q&A, and we missed it, but we were just curious on how you and Sanofi are currently thinking about indication expansion, 474 beyond HS and AD, and when some of those decisions could be made and how you're thinking about them for the time being ahead of the HS and AD data sets coming in the first half of next year. And then secondly, on a more logistical point, should we hold the expectation that the HS and AD data sets would come together, or is that not necessarily the case?
If you have any visibility at this point on which venues or which forums might be appropriate to showcase those data sets, that would be a helpful color to get from your perspective. Thanks.
Nello Mainolfi (CEO)
Thanks, Vikram. You got three questions in. Well done. So the-- let's start with the, with the last one. It, it's, you know, it's hard for us to know actually both, you know, the timing and where. You know, as, as the program's timelines have been presented in, you know, clinicaltrials.gov or disclosures from both Sanofi and us, you know, we're seeing that both studies should be able to read out in the first half of 2025. I still feel we're too early to know, you know, whether they'll be disclosed together or separately. And, and, and so, you know, give us more time. I think when we're closer, we might be able to answer that question.
In terms of the indication expansion, as also I've said in the past, we've, you know, Sanofi and Kymera worked diligently on evaluating many other opportunities. You know, many of these are obvious other indications that this biology is being validated in or, you know, known to be relevant. I think there is sensitivity about disclosing what they are, just because I think the team right now is focused on executing on these studies. I believe Sanofi will be the one, maybe disclosing other indications first, and then we'll be happy to provide more color. In terms of timing, again, I can't speak for them, but, let's say for now we're focused on executing on these studies.
You know, I believe this is a personal opinion. You know, as we get through some of these inflection points, we'll be able to share more.
Vikram Purohit (Analyst)
Got it. Thank you.
Operator (participant)
Thank you. The next question is from the line of Geoff Meacham from Bank of America. Please go ahead.
Geoff Meacham (Analyst)
Hey, thank you. I guess I have a quick question on given capital constraints, do you think that there's a scenario where you guys might partner out some of your oncology assets? Like, what factors would you take into consideration and when evaluating the potential for a partnership?
Nello Mainolfi (CEO)
Yeah. So thanks for the question. So generally, as we've said, you know, we believe, you know, partnering, you know, it's an option to continue to grow the company and needs to serve a purpose. You know, rarely, rarely, not always, but rarely I would say that financials, you know, drive partnerships. But, you know, it has to be really financials only, right? There will have to be a win-win opportunity. I think it's, you know, partnering in oncology is something that, you know, we've discussed in the past. It might be something that we'd be open to do for some of our oncology programs.
I just can't speak to specifics, given that, you know, we're still in the midst of generating important data that will first of all tell us the level of commitment that Kymera, on its own, wants to invest in this program. I think after that, we'll be able to have a clearer view of, you know, what's the best path for value creation for our oncology pipeline.
Geoff Meacham (Analyst)
Okay, great.
Nello Mainolfi (CEO)
As always, I think as always, partnership is a tool that any company should use to think about long-term value creation, as you know, we can't reinvent the wheel in every single program. Go ahead.
Geoff Meacham (Analyst)
Okay, great. And then just what are your BD priorities for this year?
Nello Mainolfi (CEO)
Sorry, say that again?
Geoff Meacham (Analyst)
BD. Yeah, business development.
Nello Mainolfi (CEO)
Yeah, I mean, I have. I think I've answered that question already. Next question.
Operator (participant)
Thank you. The next question is from the line of Kelly Shi from Jefferies. Please go ahead.
Kelly Shi (Analyst)
Thank you for taking my questions. I also have a question on IRAK4 program. We see the clinical development is expanding in this space, and oral agents like JAK inhibitor and BTK inhibitor, such as interesting efficacy signal. Curious, how should IRAK4 degrader be positioned to other oral therapeutic candidates? What would be the differentiator clinical features to be anticipated based on targeting strategy and also the MOA of degrader design?
Nello Mainolfi (CEO)
So it was a bit. The sound was not great, but maybe if I understood correctly, you were talking about how does IRAK4 compare to, like, other small molecule like JAK or BTK inhibitors in immunology. Jared, do you wanna take some of that?
Jared Gollob (CMO)
Yeah, I mean, I think certainly the differentiation, you know, is there potentially, you know, both for efficacy based on the mechanism as well as on safety. We know that 474, you know, IRAK4 degrader, because it's impacting, you know, the IL-1 receptor pathway as well as the Toll-like receptor pathway, has the ability to impact multiple different pro-inflammatory cytokines, you know, essentially with a single compound, whereas many other agents, you know, in the INI space, targeted agents in particular, have a more restricted effect on all of these pro-inflammatory cytokines. And so the broader effect on multiple different cytokines, we think, can give us broader development opportunities within autoimmune and autoinflammatory diseases. I think that is one important differentiating factor. I think the safety factor is something which also, you know, can't be overlooked.
You know, we've presented before or summarized before, the fact that there are adult human, you know, IRAK4, you know, genetic knockouts, who in adulthood do not have any, phenotype or any, susceptibility to infections. And so I think being able to potentially maximize knockdown of IRAK4 chronically, to essentially optimize efficacy without compromising safety, I think is a real central game changer and differentiating factor from other drugs, like JAK inhibitors, for example. JAK inhibitors, you know, do have broad anti-inflammatory effects, but they have significant safety liabilities in terms of risk of infection, risk of cytopenias, risk of malignancies. That is not something that has been seen, you know, in either human IRAK4 knockout, individuals or even in preclinical studies.
I think this ability to potentially really strongly degrade and knock down IRAK4 chronically to maximize efficacy while not, you know, having any safety issues, could really allow this drug to be broadly developed across multiple different indications. Also, not just in moderate to severe patients, but also in milder patients. I think this really provides an optionality that, you know, really, you know, can't be seen or challenged by other modalities. And so we think that this is one of the real value propositions of KT-474, both the differentiation potentially on the efficacy standpoint as well as on the safety standpoint.
Kelly Shi (Analyst)
Terrific. Thank you.
Nello Mainolfi (CEO)
Next question.
Operator (participant)
Thank you. The next question is from the line of Jeff Jones from Oppenheimer. Please go ahead.
Jeff Jones (Analyst)
Good morning, guys, and thanks for taking the question. Just two quick ones from us. There's some evidence of improved efficacy in targeting IL-17A and IL-17F versus just IL-17A, à la Bimi versus secukinumab. Could you comment on whether targeting IRAK4 would be expected to impact the pathway for both forms? Just a technical question. And then on the financial side, how should we be thinking about the Sanofi collaboration revenues going forward versus milestone payments? Thanks.
Nello Mainolfi (CEO)
All right, so Jared will take the first and then you.
Jared Gollob (CMO)
Yeah, I think the question around, you know, the activity of, say, IL-17F targeting versus IL-17A, especially in, like, diseases like HS, where there may be an advantage. I think sort of more broadly speaking, further, I think speaks to the advantage of having a broader anti-inflammatory effect versus a more restricted one. I mean, here it's still restricted to IL-17, but being able to hit the IL-17A and IL-17F isoforms rather than just IL-17A, is already showing you that if you broaden out the impact, you potentially can increase efficacy. Now, even though IRAK4 does not specifically target the IL-17 pathway, we know that by impacting the IL-1 family cytokine pathways as well as the toll-like receptor pathways, we do impact IL-17 production.
While we haven't looked specifically at A versus F isoform, we would assume that that impact is probably broad across multiple different IL-17 isoforms. So I think it comes back to the point I was making earlier, which is that having a drug that has a broader anti-inflammatory effect within these autoimmune diseases that have very pleiotropic inflammation, that includes, you know, both HS and AD and many others, is an advantage. And I think the 17 AF versus A is just another way to sort of highlight the advantage of going broader and having more efficacy versus being more restricted and narrow.
Nello Mainolfi (CEO)
Jeff, just to answer your question on revenues. While we don't obviously guide to collaboration revenues, you can see in our balance sheet the deferred revenue number, it's just over $46 million. That's the amount of revenue we expect to recognize over the near term as we fulfill our performance obligation. The inclusion, though, of additional milestones, or there's no additional milestones included in that number, so anything that is achieved with respect to future milestones, those would be largely recognized at that point in time. So that's what I can tell you on that.
Jeff Jones (Analyst)
Great. Appreciate it, guys. Thank you.
Operator (participant)
Thank you. This concludes our question and answer session. I would like to turn the conference back over to Justine Koenigsberg for closing remarks.
Justine Koenigsberg (Head of Investor Relations)
Okay, thank you. We'd like to thank everyone for joining us this morning and look forward to keeping you updated on our progress. Later this month, we'll be participating at the BofA conference and hope to see many of you there. In the meantime, please don't hesitate to reach out if there are additional questions following today's call. Thank you. This concludes today's call.
Operator (participant)
Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.