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    Revolution Medicines Inc (RVMD)

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    Business Description

    Revolution Medicines, Inc. (RVMD) is a clinical-stage precision oncology company specializing in the development of targeted therapies for RAS-addicted cancers. The company leverages advanced drug discovery technologies to create small molecules that address unconventional binding sites in cancer cells. RVMD's offerings include a pipeline of RAS(ON) inhibitors and companion inhibitors, designed for use as monotherapies or in combination regimens to combat genetic drivers and resistance mechanisms in cancer.

    1. RAS(ON) Inhibitors - Develops small molecules that directly bind to active, GTP-bound RAS variants, suppressing cancer cell growth and survival. Includes clinical-stage candidates such as RMC-6236, RMC-6291 (G12C), and RMC-9805 (G12D), as well as preclinical candidates like RMC-5127 (G12V), RMC-0708 (Q61H), and RMC-8839 (G13C).

    2. RAS Companion Inhibitors - Targets key nodes in the RAS pathway or associated pathways to enhance the efficacy of RAS(ON) inhibitors, primarily for combination treatment strategies.

    3. Combination Therapies - Evaluates RAS(ON) inhibitors in combination regimens, including doublet therapies with other investigational drugs, to address adaptive resistance mechanisms in cancer.

    Q3 2024 Summary

    Initial Price$38.81July 1, 2024
    Final Price$45.17October 1, 2024
    Price Change$6.36
    % Change+16.39%

    What went well

    • Revolution Medicines is advancing two Phase III trials, including the RASolute 302 study in second-line pancreatic cancer, which has already started dosing patients, and remains committed to initiating a Phase III registrational trial in non-small cell lung cancer in the near future, demonstrating strong progress towards commercialization.
    • The company is actively engaging in strategic collaborations, such as with Tango Therapeutics, to explore combination therapies with their RAS(ON) inhibitors, RMC-6236 and RMC-9805, indicating a robust pipeline and potential for synergistic treatments targeting RAS mutations and MTAP deletions in cancer patients.
    • Revolution Medicines is prioritizing multiple combination studies of their lead compound RMC-6236 with other therapies, including other RAS(ON) inhibitors, pembrolizumab, and chemotherapy, which could expand the treatment potential and address high unmet medical needs in cancers such as pancreatic cancer and non-small cell lung cancer.

    What went wrong

    • Delay in Initiation of Phase III Lung Cancer Trial: The company has pushed back the initiation of their Phase III registrational study in non-small cell lung cancer to the first quarter of 2025, citing practical constraints and the need for regulatory alignment. This delay may impact their progress in this important indication.
    • Expected Increase in Expenses Without Specific 2025 Guidance: While expenses have already increased significantly, the company expects expenses to increase further in 2025 due to starting two Phase III trials and building out the organization. However, they have not provided specific guidance for 2025, which may affect their cash runway and financial outlook.
    • Limited Focus on Additional Cancer Indications: The company acknowledges that they have not prioritized clinical development in other potential areas like acute myeloid leukemia (AML) due to resource constraints, potentially missing opportunities in other cancer indications.

    Q&A Summary

    1. Delay in Lung Cancer Phase III
      Q: Why is the lung cancer Phase III trial delayed?
      A: The company remains committed to launching the Phase III registrational trial in lung cancer in the near future. However, practical considerations, including completing internal analyses and obtaining regulatory alignment, make it unlikely to initiate the trial before year-end. With the December holiday approaching, it's too much of a stretch to assume all critical activities can be completed to start the study before the end of the year. They will continue pushing to begin the trial as soon as practical.

    2. First-Line Pancreatic Cancer Strategies
      Q: What are your plans for first-line pancreatic cancer Phase III?
      A: They are eagerly moving forward with planning a registrational Phase III trial in first-line pancreatic cancer. Based on second-line data showing progression-free survival and overall survival exceeding first-line benchmarks, they believe the agent as monotherapy is active in the first-line setting. They are considering including monotherapy as well as combinations with standard-of-care regimens like FOLFIRINOX and gemcitabine. They won't wait for second-line data before starting the first-line study. They believe KRAS is a fundamental driver regardless of therapy line and expect similar efficacy in first-line patients.

    3. Cash Runway Guidance
      Q: What's included in your cash runway guidance?
      A: The cash runway guidance fully includes the two Phase III second-line studies in pancreatic and lung cancer that the company is moving ahead with. Beyond that, they use a probability-adjusted model for potential additional programs. While they can't specify what other programs are in the forecast, the two Phase III second-line trials are fully baked in.

    4. Future Combination Collaborations
      Q: Will there be more combination studies like with Tango?
      A: They expect to pursue more collaborations combining RMC-6236 with other agents. There is a long list of requests for such collaborations, and they anticipate involving more agents and targets in future studies. Their priorities include combining RMC-6236 with other RAS(ON) inhibitors, pembrolizumab, and chemotherapy, with multiplex combinations. Other combination studies will likely emerge over time.

    5. Operating Expenses and Spending Outlook
      Q: How should we think about future spending and OpEx increases?
      A: Expenses are expected to increase as they start two Phase III trials and build out the organization, including preparations for commercial launch. While no specific guidance for 2025 is provided, it's fair to assume expenses will go up due to these activities and opportunities outside the pivotal trials.

    6. AML and Liquid Tumor Applications
      Q: Thoughts on applying RAS(ON) platform to AML?
      A: The hematology program has been mostly outsourced to academic collaborators who will present data at ASH. The company has focused on pancreatic cancer, non-small cell lung cancer, and colorectal cancer, and hasn't planned clinical development in less frequent tumors like AML. They recognize the mechanistic basis and unmet medical need and may consider clinical development in the future.

    7. Patient Background in Doublet Study
      Q: What's the patient background in the doublet study?
      A: They can't provide much detail about eligibility. The study includes patients with KRAS-G12C-bearing tumors, a mixture of solid tumor types, and varied prior treatment backgrounds. This will be best understood when the data is disclosed.

    8. RMC-6236 and RAS GAP Activity
      Q: Comments on RMC-6236 increasing RAS GAP activity?
      A: They are aware of this mechanism and discovered it some time ago, first disclosing it at an NCI RAS scientific conference a few years ago. It's quite interesting and may contribute to the therapeutic index of RMC-6236 by affecting RAS signaling more in cancer cells with upregulated RAS(ON) signaling than in normal cells with lower levels.

    9. Triplet Combinations with Pembrolizumab
      Q: Are you exploring triplet combinations with RMC-6236, pembro, and chemo?
      A: Yes, they are conducting a study combining RMC-6236 with pembrolizumab and platinum-doublet chemotherapy, effectively a quadruplet regimen. They are initiating this sequentially after identifying the appropriate dose for the doublet of RMC-6236 plus pembrolizumab. Both combinations will ultimately be valuable.

    10. Choice of Tango Collaboration
      Q: Why choose Tango's PRMT5 inhibitor for collaboration?
      A: They have done preclinical work with Tango's compound and found the combination encouraging. This doesn't preclude collaborating with other PRMT5 inhibitors. They are actively seeking the best combination partners for RMC-6236.

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    Executive Team

    NamePositionStart DateShort Bio
    Mark A. GoldsmithChief Executive Officer, President, and ChairNovember 2014Mark A. Goldsmith, M.D., Ph.D., has served as CEO, President, and Chair of RVMD since November 2014. He has extensive experience in biopharma, including roles at Constellation Pharmaceuticals and Global Blood Therapeutics.
    Jack AndersChief Financial OfficerSeptember 2022Jack Anders joined RVMD in August 2018 as VP, Finance, was promoted to SVP, Finance in March 2021, and became CFO in September 2022. He previously held finance roles at Depomed, Elan Pharmaceuticals, and Yahoo!.
    Steve KelseyPresident, Research and DevelopmentMarch 2017Steve Kelsey, M.D., has served as President, R&D at RVMD since March 2017. He previously held leadership roles at Onkaido Therapeutics, Medivation, and Geron Corporation, and serves on scientific advisory boards.
    Margaret HornChief Operating OfficerOctober 2018Margaret Horn, J.D., has served as COO since October 2018. She was previously General Counsel (2014–2022) and EVP (2014–2018) at RVMD, and COO at ProLynx LLC from 2010 to 2014.
    Wei LinChief Medical OfficerApril 2023Wei Lin, M.D., has served as CMO since April 2023. He has oncology expertise from roles at Erasca, Nektar Therapeutics, and Genentech, where he led global approvals for TECENTRIQ® and other therapies.
    Xiaolin WangExecutive Vice President, DevelopmentMarch 2021Xiaolin Wang, Sc.D., has served as EVP, Development since March 2021. She previously held leadership roles at Acerta Pharma, Geron Corporation, and Genentech.
    Jeff CisliniSVP, General Counsel, and SecretarySeptember 2022Jeff Cislini has served as SVP, General Counsel, and Secretary since September 2022. He previously held legal roles at Atara Biotherapeutics, O’Melveny & Myers LLP, and Wilson Sonsini Goodrich and Rosati.
    Frank ClyburnBoard Member (Class II Director)August 5, 2024Frank K. Clyburn, Jr. was appointed as a Class II Director on August 5, 2024. He has extensive experience in pharma, including as CEO of IFF and EVP at Merck, where he led the global launch of Keytruda.
    Mary Pinder-SchenckSVP, Head of Medical AffairsAugust 2024Mary Pinder-Schenck, M.D., serves as SVP, Head of Medical Affairs. She was appointed as part of strategic leadership hires announced in August 2024.
    Ryan AsaySVP, Corporate AffairsAugust 2024 (est.)Ryan Asay serves as SVP, Corporate Affairs. He was appointed as part of strategic leadership hires announced in August 2024, though the specific start date is not provided.
    Mason ShihSVP, Head of Drug SafetyAugust 7, 2024Mason Shih, M.D., serves as SVP, Head of Drug Safety. He was appointed as part of strategic leadership hires announced on August 7, 2024.
    Jing YiSVP, Head of Program LeadershipAugust 2024Jing Yi, Ph.D., serves as SVP, Head of Program Leadership. She was appointed as part of strategic leadership hires announced in August 2024.

    Questions to Ask Management

    1. Can you explain the specific reasons behind the delay in initiating the Phase III registrational study for RMC-6236 in non-small cell lung cancer, and what challenges remain before regulatory alignment can be achieved?
    2. Given that you initiated the Phase III trial for pancreatic cancer but not yet for lung cancer, can you discuss the differences in data or strategic considerations that have led to the divergence in timelines between these two programs?
    3. With your cash runway projected to fund operations into 2027, can you clarify what is included in your financial projections, specifically how potential future pivotal trials beyond the two disclosed Phase III second-line studies are factored into your probability-adjusted model?
    4. In the RAS(ON) inhibitor doublet study combining RMC-6236 with RMC-6291, can you provide more details on the patient population, including prior treatments and tumor types, and what specific qualitative evidence are you seeking to assess the combination's effectiveness over monotherapy?
    5. Regarding your clinical collaboration with Tango Therapeutics, what strategic considerations led you to choose their PRMT5 inhibitor over other programs, and how does this collaboration align with your broader combination strategy for RMC-6236?

    Past Guidance

    Q3 2024 Earnings Call

    • Issued Period: Q3 2024
    • Guided Period: FY 2024
    • Guidance:
      1. Full-Year 2024 GAAP Net Loss: Expected to be between $560 million and $600 million, including estimated non-cash stock-based compensation expense of $70 million to $80 million.
      2. Cash Runway: Ended Q3 2024 with $1.55 billion in cash and investments, projected to fund planned operations into 2027.
      3. 2025 Expense Outlook: Expenses expected to increase due to initiation of two Phase III trials, organizational build-out for commercial preparation, and other opportunities outside of pivotal trials.

    Q2 2024 Earnings Call

    • Issued Period: Q2 2024
    • Guided Period: FY 2024
    • Guidance:
      1. Full-Year 2024 GAAP Net Loss: Expected to be between $560 million and $600 million, including estimated non-cash stock-based compensation expense of $70 million to $80 million.
      2. Clinical and Pipeline Guidance:
        • RMC-6236:
          • Initiation of Phase III registrational study (RASolute 302) for second-line metastatic pancreatic cancer planned for 2024.
          • Updated safety and antitumor activity data, including durability data for non-small cell lung cancer (NSCLC), expected in Q4 2024.
          • Initial data from the combination study of RMC-6236 with pembrolizumab (with or without chemotherapy) in advanced RAS-mutated NSCLC expected in Q4 2024.
        • RMC-6291:
          • Initial data from the combination study of RMC-6291 with RMC-6236 in KRAS G12C solid tumors (primarily NSCLC) expected in Q4 2024.
          • Initial data from the combination study of RMC-6291 with pembrolizumab (with or without chemotherapy) anticipated in the first half of 2025.
        • RMC-9805:
          • Initial safety, tolerability, and antitumor activity data from the first-in-human monotherapy study expected in Q4 2024.

    Q1 2024 Earnings Call

    • Issued Period: Q1 2024
    • Guided Period: FY 2024
    • Guidance:
      1. Full-Year 2024 GAAP Net Loss: Expected to be between $480 million and $520 million, including estimated non-cash stock-based compensation expense of $70 million to $80 million.
      2. RMC-6236 Clinical Trials:
        • Launch of first registrational trials for RMC-6236 as a second-line treatment in advanced pancreatic cancer and advanced non-small cell lung cancer in the second half of 2024 ,.
        • Updated clinical data for RMC-6236 in pancreatic ductal adenocarcinoma and non-small cell lung cancer cohorts, including durability data, to be disclosed near the launch of these trials.
      3. RMC-9805 (RAS(ON) G12D-Selective Inhibitor):
        • Initial safety, tolerability, and antitumor activity data for RMC-9805 to be shared in the second half of 2024.
        • Planning for a combination study of RMC-6236 and RMC-9805 in patients with advanced RAS G12D-mutated cancers.
      4. RAS(ON) Inhibitor Expansion:
        • Continued efforts to expand the reach of RMC-6236 into different RAS genotypes and tumor types, with a focus on first-line treatments for pancreatic and lung cancers ,.

    Q4 2023 Earnings Call

    • Issued Period: Q4 2023
    • Guided Period: FY 2024
    • Guidance:
      1. Full-Year 2024 GAAP Net Loss: Expected to be between $480 million and $520 million, including estimated non-cash stock-based compensation expense of $70 million to $80 million.
      2. Cash and Investments: Ended 2023 with $1.85 billion in cash and investments, expected to fund planned operations into 2027.
      3. Clinical Development Milestones:
        • RMC-6236:
          • Plan to initiate monotherapy pivotal trials in the second half of 2024 for second-line treatment in lung and pancreatic cancers.
          • Initial clinical PK, safety, tolerability, and activity data from genotype and tumor type cohorts expected in the second or third quarter of 2024.
          • Initial data from combination drug cohorts (e.g., with checkpoint inhibitors) anticipated in the second half of 2024.
        • RMC-6291:
          • Initial clinical PK, safety, tolerability, and activity data from the RAS inhibitor doublet trial (with RMC-6236) expected in the second half of 2024.
          • Data from combination studies with checkpoint inhibitors also expected in the second half of 2024.
        • RMC-9805:
          • Initial safety and activity data anticipated in the second half of 2024.

    This table summarizes the issued and guided periods alongside the exhaustive guidance provided in each earnings call.