Q1 2024 SpringWorks Therapeutics Inc Earnings Call

Participants

Samantha Sandler; Senior Director of Investor Relations; SpringWorks Therapeutics Inc

Saqib Islam; Chief Executive Officer, Director; SpringWorks Therapeutics Inc

Bhavesh Ashar; Chief Commercial Officer; SpringWorks Therapeutics Inc

James Cassidy; Chief Medical Officer; SpringWorks Therapeutics Inc

Francis Perier; Chief Financial Officer; SpringWorks Therapeutics Inc

Anupam Rama; Analyst; JPMorgan Chase & Co..

Yaron Werber; Analyst; TD Cowen

Corinne Jenkins; Analyst; Goldman Sachs

Peter Lawson; Analyst; Barclays

Alec Stranahan; Analyst; Bank of America

Michael Schmidt; Analyst; Guggenheim Securities

Presentation

Operator

Good morning. My name is Towanda, and I will be your conference operator today. At this time, I would like to welcome everyone. The SpringWorks Therapeutics first quarter 2024 earnings conference call. (Operator Instructions)
Thank you. I would now like to hand the conference over to Samantha Sandler, Senior Director of Investor Relations at SpringWorks Therapeutics Summit. You may now begin the conference.

Samantha Sandler

Thank you and good morning, everyone. Welcome to SpringWorks Therapeutics first quarter 2024 earnings conference call. This morning, we issued a press release which outlines the topics we plan to discuss today you can access the press release as well as the slides that we'll be reviewing today by going to the Investors and Media section of our website at www.springworkstx.com.
Joining me today are Saqib Islam, Chief Executive Officer; Bhavesh Ashar, Chief Commercial Officer; Dr. Jim Cassidy, Chief Medical Officer; and Frank Perier, Chief Financial Officer. Dr. Badreddin Edris, Chief Operating Officer, is also on the line and available during Q&A.
Before we begin, I'd like to remind you that some of the statements made during the call today, our forward looking statements that are subject to a number of risks and uncertainties. These may cause our actual results to differ materially, including those described in our reports filed with the SEC You are cautioned not to place any undue reliance on these forward-looking statements and SpringWorks disclaims any obligation to update such statements.
I will now turn the call over to Saqib.

Saqib Islam

Thank you, Sam, and thank you all for joining this morning. Today, I'm pleased to share our first quarter performance as well as our progress towards accomplishing our key objectives for 2024 and beyond. A top priority for SpringWorks is to continue to execute on our successful US launch of our Zovio for Des Moines tumors. And we are very pleased with our strong start in the first quarter of 2020. For our first full quarter on the market, we reported $21 million in net product revenue.
This performance underscores the high unmet need for patients with Des Moines tumors, the transformative benefits of Auxilio to these patients and strong execution across our commercial efforts. We are encouraged by the strong adoption to date and believe there is a meaningful opportunity ahead of us to serve Dentsply tumor patients at all stages of their treatment journey. We are focused on delivering our Zovio to the broad Des Moines tumor community and believe that we are establishing a new standard of care for the treatment of this disease.
A second key priority for us is the significant opportunity we see for Merimepodib, our MET inhibitor to help a large number of patients with neurofibromatosis type one associated plexiform neurofibromatosis or NS. one Ps. We believe regiment that is a potentially best-in-class treatment for both children and adults with these debilitating tumors. We initiated our rolling NDA submission in March of this year, which we expect to position us to have our second approved product by 2025. We are also continuing to progress our broader targeted oncology pipeline, which presents multiple opportunities to advance the standard of care across different patient populations. Our ongoing studies are targeting a variety of indications, including ovarian, granular cell tumors, multiple myeloma, Matt Kane, mutant solid tumors and Hippo mutant solid tumors, which we will be discussing this morning.
Finally, we are in a strong financial position with a balance sheet that is expected to fund our operations through profitability.
I'll now turn this call over to Bhavesh Ashar, our Chief Commercial Officer to discuss our commercial progress this year. Data.

Bhavesh Ashar

Thank you, socket. I'm pleased to share an update on the October launch in the United States in our initial months of market we have been intensely focused on delivering of Civeo as the first and only FDA approved therapy for adults living with Desmond tumors and establishing a new standard of care for these patients. Our field team has been actively engaging with physicians who manage Des Moines tumor patients across treatment sites.
As Chuck highlighted in the first quarter of 2024, which was our first full quarter of activity of commercialization. We generated $21 million in net product revenue, driven by strong commercial execution and high demand from both physicians and patients. We've seen robust adoption given the large unmet need in this patient population who previously only had suboptimal off-label treatment options available to them. Also contributing to the rapid uptake was high awareness of the availability about Civeo as the only approved medicine developed specifically for the treatment of BEST1 tumors. We have strong engagement of and advocacy from Desmond tumor experts at sarcoma centers of excellence, many of whom were investigators in our Phase three DeFi study.
They've led the way in prescribing Octavio to their patients with physicians at 77% of these institutions already having prescribed oxygen. We are also pleased to see early use of observation by physicians and other academic centers as well as community practices. Importantly, patients prescribed that sodium have been able to access the product efficiently. We have seen broad reimbursement across payer types, supported by the clear clinical value of our medicine and also the NCCN guidelines listing of Civeo as a category one preferred treatment.
We're also encouraged with early feedback on patients' response to oxybate therapy in a few months since launch, we're hearing consistent feedback on symptom relief, in particular, reports of quick reductions in patients' pain levels after initiating treatment in the fullness of time on therapy, we expect tumor shrinkage to be consistent with what was demonstrated in the DeFi study in a recent survey of 75 oncologists, we received overwhelmingly positive feedback from those who have used Oxinium, coupled with a high degree of anticipation from others to use the medicine, 76% of oncologists surveyed have already prescribed or indicated that they plan to prescribe Qsymia.
Importantly, all those who have experience using it indicated satisfaction is up Silvio and 98% of them reported that they are likely to use Octavio as a front-line treatment. This gives us confidence in our ability to become the go-to systemic treatment for the up to 650 newly diagnosed patients annually in the US. Furthermore, in just four months on market, the vast majority who have prescribed at Civeo already preferred over other unapproved systemic treatment options, which have been known to have inconsistent efficacy and challenging tolerability.
This is consistent with our pre-approval market research and highlights that our CBO's real-world experience is aligning with the promise shown in our clinical trials. These early metrics are encouraging and our performance to date has reinforced our confidence in our strategy for sustained growth, which is focused on three pillars. First, continuing to drive depth of prescribing at centers of excellence and other high-volume institutions. Second, expanding the breadth of prescribing in other academic and community centers. And finally, maintaining strong access for patients and supporting appropriate utilization. With the momentum we've built since launch, we believe we are strongly positioned for long-term success. First does move tumor treatment guidelines have evolved in favor of systemic treatment as the first-line intervention from most tumor locations.
Very strong awareness of these guidelines, which support the opportunity for an FDA approved therapy like Octavio to be used earlier in the treatment paradigm with a strong clinical profile, NCCN Category, one preferred treatment listing and high brand awareness. We believe Octavio is well positioned to be prescribed to a broad pool of Des Moines tumor patients across their treatment journey. Second, strong adoption of Des Moines tumor-specific ICD-10 codes since their introduction in October 2023 strengthens our confidence in the size of the actively managed population of 5,500 to 7,000 as more tumor patients. The growing use of these codes also enables real-time patient identification, which is especially helpful in supporting our efforts in the community setting where we need to be in the right place at the right time to support physicians with educational resources and the availability of Octavio as an effective and approved treatment option for adult patients. In addition, insurers are broadly reimbursing our service since approval of CBO has been reimbursed by payers representing 98% of commercially covered lives, and we're encouraged by how quickly our CBO has been added to formal commercial coverage policies.
We have also rapidly secured access for Medicare and Medicaid patients enhancing the patient experience without Silvio is also a top focus. We're excited to share that the FDA has recently approved our supplemental NDA for 150 milligram and 100 milligram of severe tablets in new blister packs. The introduction of this new product format is expected to increase patient convenience and adherence by reducing the number of pills, a patient has to take daily.
And by making morning and evening, dosing center blister packs will be commercially available in the middle of May last week, we have continued to invest in our IP portfolio and currently have 21 FDA Orange Book-listed patents providing protection into 2043. Our first quarter performance strengthens our conviction in our view of becoming the systemic therapy of choice for adult patients with asthma tumors. We are still in the early days of our launch, and we believe that we have reached only a small proportion of the patient population that can benefit from treatment.
With that, Fabio, I'll now hand over to Dr. Jim Cassidy, our Chief Medical Officer, to discuss the progress we're making across our development programs.

James Cassidy

Thanks, Bhavesh. I'm glad to provide updates on our pipeline, starting with how we are maintaining positive momentum for our two lead programs and definitely tumors. The European Medicines Agency validated our marketing authorization application for natural gas that for the treatment of adults with Des Moines tumors in February. This is an important step towards potentially bringing the first approved therapy to Des Moines tumor patients in the EU. We're also pleased that additional data from the Phase three DeFi trial will be presented at Asco.
These results reinforce the robust and clinically meaningful safety and efficacy profile of Madagascar that in adult patients with asthma tumors from the commercial and maintenance for NF1 PN in the first quarter, we held a successful pre-NDA meeting with the FDA and initiated a rolling NDA submission. We expect to complete that submission by the end of June, bringing us closer to our goal of having a second approved medicine by 2025. We're delighted that data from the Phase 2b RENEW trial, and that amendment were accepted for an oral presentation at Asco. These data are the cornerstone of our NDA filing and we expect the results to be published in a peer review journal this year. Beyond the US, we had posted engages with the EU regulators and are advancing our preparations to submit a marketing authorization application for motor maintenance to the European Medicines Agency in the second half of 2020.
For coming to the new study, we're enthusiastic that maintenance has the potential to be a best-in-class therapy for children and the first-in-class medicine for adults with NF1 PN for approximately 40,000 people living with NF1 PN in the United States and many of these patients have needs that are not addressed by current options. Positive top line results from our pivotal Phase 2b RENEW trial demonstrated evidence of major maintenance differentiation and potentially transformative benefit for these patients with a maintenance should compelling. Antitumor activity was robust.
Objective Response Rate confirmed by blinded independent central review and deep responses in both the pediatric and adult cohorts the depth of response we saw in the trial in both children and adults were unprecedented in studies of other MAC inhibitors, particularly given the hard-to-treat patients we enrolled, it's been difficult to achieve deeper responses, especially in adults with NF1 PN. So that robust volumetric changes we saw provides strong evidence of the unique activity profile of development in this disease in both children and adults might have met and have also demonstrated a manageable safety profile with the vast majority of AEs being Grade one or two, supporting the potential for extended treatment durations plexiform unified rumors are highly morbid tumors that have a profound physical and emotional impact on patients and their caregivers. So the fact that the maintenance treatment resulted in statistically significant improvements in patient reported outcomes, including pain, was also very meaningful, NF1 PN and demonstrating and lifelong disease that typically requires chronic therapy.
Reducing the treatment burden in a real-world setting is critically important, and we believe that modern maintenance optimized dosing regimen, which provides a bill and treatment holiday and a convenient pediatric friendly dispersible formulation could further improve the patient experience and potentially enhance compliance. Overall, we believe that automated provides the potential for class leading efficacy and safety in NF1 PN pediatric patients and can establish our significant first in class therapy for adults transitioning to our emerging portfolio. We continue to make strong progress, expanding the opportunity set and our pipeline, our Phase two trial of natural gas that in patients with ovarian granules or cell tumors is fully enrolled, and we expect to report initial data in the second half of 2024 of any granular cell tumors account for approximately 5% of ovarian cancers and similar today's most tumors.
This is a meaningful patient population with significant unmet need with no approved therapies for these patients in multiple myeloma with clinically validated nat gas. That's ability to potentiate BCMA directed agents across modalities. And we are continuing to evaluate combination regimens in collaboration with industry leading partners similar to our approach of Madagascar that we are pursuing expansion opportunities from our commitment, including monotherapy and combination therapy applications in rare oncology and biomarker defined solid tumors. This includes ongoing combination studies with vemurafenib in advanced solid tumors with MAP kinase mutations and Beijing's liver evident in Ras mutant solid tumors. We're also excited about the opportunities ahead for BM&F and at an investigational next-generation rough diamond inhibitor that's being developed by Mark here, our joint venture with Beijing.
We believe that up to 7% of solid tumors harbor oncogenic Vera aberrations that could potentially be targetable with Dermagraft. And this includes mutations and fusions where currently approved therapies are effective for wear resistance occurs. Those expansion is ongoing in patients with BRAF V600 mutated solid tumors that had progressed on prior B-Raf make and those with BRAF. Class two or fusion mutant solid tumors. It's encouraging that we've already demonstrated responses during the dose escalation in each of these patient populations.
Additional data from the monotherapy study are expected in the second half of 2024. In the first quarter, we initiated a Phase Ib combination study of Derma AFib with Amgen's panitumumab in colorectal and pancreatic cancer patients with known MAP kinase pathway mutations and patient dosing is currently underway, as I just noted, a Phase one combination study with MedNet. And then there's also ongoing.
Additionally, we are pleased that SW. 62, our novel novel oral potent investigational patented inhibitor, is progressing into the clinic. This program is designed to treat tumors with Hippo pathway mutations, which can occur in up to 10% of cancers, including mesothelioma and head and neck cancer. We believe that there is a meaningful opportunity for SpringWorks to create a best-in-class program for Hypo driven cancers. Our IND. four SW. 62 was cleared in January, and our Phase one study is on track to initiate in the second quarter.
Lastly, we've continued to enhance our drug discovery and translational medicine capabilities. We have several preclinical programs under development and look forward to sharing more as our work advances. I know Frank Pettit, our Chief Financial Officer, will share our first quarter financial results.

Francis Perier

Thank you, Jim. Detailed First Quarter 2024 financial results can be found in our press release but I'll summarize a few highlights here. Starting with our revenues, we were pleased to record $21 million of Oxinium net product revenue in the first quarter. Our total operating expenses increased compared to the first quarter of 2023, driven by commercial activities to support the U.S. launch of Oxinium.
We continue to maintain a strong financial position with 573 million in cash, cash equivalents and marketable securities on our balance sheet. As of the end of the first quarter, we have a clear path to profitability and a long-range operating plan that supports multiple product launches and gives us the flexibility to invest in opportunities across our portfolio.
With that, I'll turn the call back over to Saqib.

Saqib Islam

Thank you Frank to close, it has been a successful start to the year for SpringWorks. We're delivering on our commitment to establish Zovio as the standard of care treatment for adults with Des Moines tumors. As Bob has highlighted, we are quite encouraged by the growth we are seeing, which is driven by both the breadth and depth of prescribers and the broad satisfaction of patients who are using the medicine awareness is high as feedback from physicians has been overwhelmingly positive.
And importantly, patients are experiencing significant benefits from Auxilium, most notably rapid reduction in their pain symptoms. In addition, payers across all segments of the reimbursement landscape are recognizing the value of Auxilio and providing broad access to patients. We are pleased with our strong execution to date, but recognize that we are still in the very early stages of our US launch with many more patients to serve our data show that there is a broad pool of approximately 5,500 to 7,000 actively managed as more tumor patients living in the United States today and the commercial performance of Zovio thus far as well as further insights we have gathered from the launch reinforces our confidence in the overall patient population. We have high conviction that Auxilium has the opportunity to deliver significant benefits to patients across their treatment journeys, either newly diagnosed or having previously been treated with other approaches. And we look forward to providing updates on our performance over the course of the year.
We're also advancing the ultimate nib towards regulatory approval as a potentially best in class treatment for children and adults with NF1, PN physicians and patients have consistently highlighted their strong desire for a new therapy that offers better tumor and symptomatic control, an improved tolerability profile that enables patients to stay on therapy and a more convenient patient experience to enhance long-term compliance and treatment outcomes. We believe the renewal results represent best in class data for both pediatric and adult patients, the latter of whom do not currently have an approved treatment option. Our data demonstrate their tremendous potentially differentiated risk benefit profile with unprecedented depth of response and manageable safety, all of which point toward a significant opportunity for Merit and that needs to help a large number of people living with NF1 PN or in need of a safe and effective therapy beyond our lead programs, we're also committed to progressing our broader pipeline. We've already generated proof-of-concept data in monotherapy and combination settings against several different diseases, and we are preparing for multiple catalysts over the course of this year.
Finally, we have robust intellectual property protections for our lead assets and a strong balance sheet to further support our long-term aspirations. We expect 2024 to be another meaningful year for SpringWorks and the patients we aim to serve as our team continues to deliver on our mission of changing the lives of people suffering from devastating diseases. As always, I would like to thank the patients and investigators who participated in our clinical trials, our patient advocacy partners and industry collaborators and our team of Supreme workers.
We are now happy to take questions, operator, and thank you.

Question and Answer Session

Operator

(Operator Instructions) Anupam Rama, JPMorgan.

Anupam Rama

Hey, guys. Thanks so much for taking the question and congrats on the early innings of the exit of your large share. I was wondering for Octavio, could you provide any color on inventory dynamics that you're seeing in the quarter and how you're thinking about this moving forward? Thanks so much.

Saqib Islam

Thanks, that upon publish, I'll let you answer that question?

Bhavesh Ashar

Thanks for the question. So our distributors are holding minimal inventory levels and this is fairly standard for any specialty product and up. But our first quarter revenues, I would say primarily driven driven by demand, both across new patients as well as refills for patients who are continuing treatment at. And at the physician level, we're not seeing any stocking that typically ordering just in real time as patients are prescribed or or they're refilling their existing prescription going forward, we don't expect to see a change in this. Our distributors do hold very minimal levels. And so we do not expect to see any significant changes in trends.

Operator

Yaron Werber, TD Cowen.

Yaron Werber

Congrats on the really, really great to see the service launch. And so maybe just a quick question can you give us a little bit of a sense we've done a lot of physician checks and they're saying that pretty clearly as patients come in. This is not just for new patients, but they're also actively switching and are interesting and continuing to switch away from chemo and obviously TKIs, what are you seeing in the market? And can you quantify a little bit, how much is total prevalence pool switching versus incidents in the quarter in terms of sales? Thank you.

Saqib Islam

Okay. Thanks your own. But I think it's an important question and certainly let me start by saying that everything we have seen thus far gives us confidence and in fact, heightened confidence on our numbers with respect to expectations on patients.
Right. So the number you're referring to of patients currently on treatment, we're talking about 6 to 7,000 currently on treatment in the US and newly diagnosed. We expect about 650 annually in the US. So everything we've seen thus far confirms those numbers, confirm those numbers and perhaps at the high end from where from where from our experience thus far though we have seen patients of all stripes, both newly diagnosed as well as those in the prevalent pool from where we stand at the moment is, you know, Bob has talked about, you know, the prescriber behavior which we are seeing is the standard of care, and that's driving our confidence in getting to a large percentage of that currently treated group. So we are seeing those patients come in. They tend to come in all through the course of the year as people finished treatments that they're currently on and make that switch. But the enthusiasm from clinicians certainly bolsters our view there.
And secondly, I bring up you think of these the newly diagnosed patients, the survey work we've done, which shows that we very much expect to be the first line of treatment for these newly diagnosed patients. So our confidence in that group is high.
To your specific question. We've seen some of all we expect the newly diagnosed to be temporarily driven over the course of the year as somebody gets diagnosed. That's where we expect to be the front-line treatment. And we expect to be the standard of care for patients as they and terminate other off-label treatments over time.

Operator

Corinne Jenkins, Goldman Sachs.

Corinne Jenkins

And good morning, guys. I think you alluded a bit to this on the call, but maybe you could spend a bit more time contextualizing what you're seeing with respect to both the breadth and depth of utilization of Activia across the target prescriber population and in particular, where you anticipate and what you anticipate with respect to growth in those two directions over the course of the year things?

Saqib Islam

Thank you, Karin. And I think you kind of come back to our view, certainly have confidence in the overall opportunity in terms of the number of patients to help. I do think that where we sit as far as the drivers of all of that, you know, you've got a situation. We've got high unmet need. And as more tumors and a high awareness of Auxilio among patients and physicians as the first and only approved therapy, we have a broad label with no restrictions. We've got very strong physician engagement, and we've got a robust reimbursement environment for us.
So that's where we begin as we think of where the early adoption has been. We have been very pleased with the breadth of our prescribers, both in the centers of excellence, which is where you would expect to see early penetration given their familiarity with the DeFi study, the familiarity with our Zovio, but also very much. So we've been very pleased to see it in the community setting as well. And I think the combination of both of those breadth and our confidence that the depth is at a place where we're really only scratching the surface. So we've seen some from all of this prescriber base and a high conviction that we're only starting.

Operator

Peter Lawson, Barclays.

Peter Lawson

Thank you for taking the questions for group loans as well. And I wonder if you can make any comment around the mixture of patients between patients you think that could have switched from existing therapies versus new patients?

Saqib Islam

Sure, Peter. I think we touched on that a little bit on the prior question, but we are getting some of both. We are certainly getting patients who are switching out. Some of them have switched immediately coming in the middle of the course of their treatment. Others are appropriately waiting for them to finish a line of treatment before they get on a GPO, and that's what we would have it at what we would have expected.
In addition, we are seeing patients who are first diagnosed with their desk, more tumor coming to Auxilio, and we expect to be the front-line treatment based on the feedback we have thus far from from physicians and certainly I think we're we continue to see the opportunity in both those areas, but tough for us at this early stage to quantify, you know, our first four months of sales, which patient fall into which category.
Thank you, Peter.

Operator

Alec Stranahan, Bank of America.

Alec Stranahan

Hey, guys. Thanks for taking my questions and congrats on the progress of the launch so far. Apologies if I missed this, but within that 21 million number I guess how many of the December are the patients that initiated therapy in December, does that include? And any forward looking guidance, whether the blister pack will help? Is that getting patients on therapy? Or is that more a compliance to therapy and consideration?

Saqib Islam

Well, I think if you're asking a question about patient renewals, I think that we expect and we continue to experience the renewals that you would see with the first and only approved treatments in the market and a high degree of confidence for patients to stay on treatment on the data that we have shown that I can point to from our Phase two and Phase three of patients staying on treatment for extended duration was certainly imply that you've got the vast majority of those patients. And from the our December numbers continuing to build and as we would expect to stack into this quarter and the quarters that we would have going forward.
As it relates to the blister pack. Listen, we do this as an innovation for patients. It is a convenience and for them, we think that is a meaningful opportunity to once more put the patients at the center of everything we do and allow them the convenience of taking fewer pills in a more organized fashion. And we think it is going to be meaningful and will benefit compliance and certainly benefit patients going forward.
Thank you.

Operator

Michael Schmidt, Guggenheim.

Michael Schmidt

Hey, guys, good morning. Thanks for taking our questions and congrats on the great early launch. I think a lot of the feedback has been very consistent with what we've heard in our own survey work. But yes, I think a key perhaps just a question on reimbursement. I know that definitely tumors is a very low Medicare market Medicare percentage population. But on, you know, have there been any seasonal headwinds in the first quarter that could come in?

Saqib Islam

Sure. Thank you, Alex. So I will take the first part of that question and then pass it over to Bob to take the rest because and I would say that from where we stand at the moment, you're correct that this is largely a commercial payer population as you think of the agents of patients of who are first diagnosed with, it does more tumor. So it's largely commercially focused that we've been incredibly pleased with where we stand from a reimbursement standpoint. And I think a lot of good work has gone into that from the team. And Bob I'll let you talk about that.

Bhavesh Ashar

Yes, or no. Look with four months into launch, we're in a very strong position from an access standpoint. The vast majority of our adult patients with asthma tumors have coverage and very strong coverage. And we've achieved broad access across all segments, commercial, Medicare, Medicaid, and even from a mix perspective, the mix has been pretty much what you'd expect based on the age range for Desmond tumor patients with the majority Scoot skewing towards commercial and no surprises towards the payer mix and neither any surprises towards the a quick availability of access for these patients. So all in line with expectations.

Operator

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.