Analyst Conference Summary



conference date: February 14, 2018 @ 5:00 AM Pacific Time
for quarter ending: December 31, 2017 (Q4, fourth quarter 2017)

Forward-looking statements

Overview: Increased Idhifa revenue, raised cash, advanced pipeline.

Basic data (GAAP):

Revenue was $9.8 million, down sequentially from $11.4 million, and down from $22.6 million year-earlier. All revenue is from collaborations.

Net income was negative $88.3 million, down sequentially from negative $77.1 million, and down from negative $56.5 million year-earlier.

EPS (diluted GAAP) was negative $1.81, up sequentially from negative $1.59, and up from negative $1.34 year-earlier.



Conference Highlights:

David Schenkein, M.D., CEO of Agios said "“2017 was an extraordinary year for Agios with the U.S. approval of IDHIFA®, our first internally discovered and developed drug, the NDA submission for our wholly owned medicine ivosidenib and our sixth IND submission since the company’s inception. It was a data-rich year where we set the stage for building long-term value across our cancer and rare disease portfolios. Execution in 2018 will be equally critical as we ready our organization for the potential approval and launch of ivosidenib, initiate our pivotal program for AG-348 in pyruvate kinase deficiency and advance our robust discovery portfolio.”

$1.2 million of revenue in the quarter was from royalties for Idhifa, up sequentially from 0.7 million.

Idhifa (AG-221, Enasidenib) for IDH2 positive relapsed/refractory AML (acute myeloid leukemia) was approved by the FDA on August 1, 2017. This is in partnership with Celgene and is based on Phase 1/2 data. The Phase 3 trial continues to confirm the data, despite the full approval. An MDS trial is also planned. Updated Phase 1/2 IDH2m R/R AML data was presented at ASCO. Celgene will market Idhifa and pay Agios tiered royalties, ranging from single digits to low double digits. More data will be released this year.

AG-120 (ivosidenib) in R/R AML patients with an IDH1 mutation was been submitted to the FDA in the quarter. An approval could come Q3 this year. An EMA submission should be made before the end of 2018.

With Celgene, Agios plans to start a Phase 3 trial for frontline AML combining ivosidenib or enasidenib with 7+3 chemotherapy in Q4 2018. Updated data from the trial combining them with Vidaza has been submitted for ASCO.

Agios sees a total $2 billion opportunity for IDH drugs in AML [but much of that would go to partner Celgene, which reported Idhifa revenue of $13 million in Q4]

A randomized Phase 3 study (ClarlDHy) of AG-120 (ivosidenib) in IDH1 mutant positive cholangiocarcinoma in continued enrollment, which is expected to complete in 2019. If approved would be the first targeted therapy for this disease, which has about 3,000 IDH1+ patients annually.

Phase 1 dose-escalation and expansion study of AG-881 in IDH mutant positive hematologic malignancies completed the dose-escalation phase. Data to be submitted at ASCO. Another Phase 1 study for IDHm positive glioma should start its dose escalation phase in Q1 2018. Also looking at ivosidenib as a possible treatment for this disease.

Phase 1 study of AG-519 for PK deficiency in healthy volunteers enrollment continues.

AG-348 for Pyruvate Kinase Deficiency (PKD) hemoglobin levels new data was presented at ASH. Has Fast Track designation. Finalized the plan for the two pivotal trials to start in the first half of 2018. Agios fully owns 348. Activate and Activate-T pivotal trials will start in Q1 and Q2 2018 respectively. A Phase 2 proof of concept trial for thalassemia will begin in Q4 2018.

Preclinical activities continued for AG-270 for MTAP (methylthioadenosine phosphorylase) deleted cancers .... 15% of all cancers have MTAP deletions. Celgene is collaborating on AG-270. A Phase 1 study should start in Q1 2018.

Will initiate preclinical development activities for the first molecule in the next wave of novel investigational cancer metabolism medicines. An IND for DHODH (dihydroorotate dehydrogenase) for hematologic malignancies should be submitted in Q4 2018.

Cash (including equivalents & securities) ended at $568 million, down sequentially from $641.7 million. $516 million raised in January 2018. No debt.

GAAP operating expenses were $99.9 million, consisting of: $77.2 million for R&D and $22.7 million for G&A. Loss from operations was $88.3 million. Interest income was $2 million.

For the full year 2017, revenue was $43 million, R&D expense $293 million, and G&A expense $71 million.


Ivosidenib priority review? We will announce if we receive it.

Shift from overall survival? AML had several new approvals last year. Event free survival was used as an endpoint for mylotard. Overall survival is often biased by follow-on therapies. You can also provide for patients to cross over to active therapy.

Duration of treatment, sales? We promote to the FDA label, minimum of 6 months or until progression. Doctors indicate they intend to treat to overt progression. Idhifa already having an impact.

Size of potential treatment pool? As high as 25% of AML population not treated with chemo because of age, frailty, etc. In our trials patients had to be not qualified for standard induction, as well as being IDH2 positive.

Europe? We will have discussions with EU regulators about whether our FDA package will work for conditional approval.

Biomarkers for earlier programs? Metabolism covering about 15% of all tumors. Lost CDKN2A is the biomarker, which is standard in next-generation sequencing panels, then best for loss of NTAP. We will look for correlation between several biomarkers and any response.

Tumor types? Too early to speculate. Phase 1 will be a basket type of trial, based on biomarkers. Will not try with glioblastoma.

Prevalence of PKD? we are using 3,000 to 8,000, but estimates vary widely.

Sales infrastructure, expense? Sales force will be hired in Q1. Number is in mid-30s. So you will see SG&A rate in Q1.

What would the FDA be looking to for full approval? The primary endpoint is overall survival; we are looking at possibly changing to event-free survival. OS would be an important secondary endpoint.

348 in PKD dosing? We have guidance on dosing up and down, as well as pausing.

881 in solid tumors, profile vs. Idhifa, Ivo? 881 was designed as a more brain penetrating inhibitor than in ivosidenib. But we did see ivosidenib effects in the brain. 881 has more profound reductions in the biomarker. The study will compare the two, and will use brain samples to see the effects of the two molecules.

MTAP program details? When we have enough data, we will bring it to a medical meeting. Can't predict the number of dose cohorts needed for that.

Activate trial? Global studies, getting sites up, want to recruit and generate data as quickly as possible.

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Disclaimer: My analyst call summaries may include both our condensations of statements made by company representatives and my own analysis. They are not covered by any warranty. I cannot guarantee anything said by company representatives is true. I try not to make errors, but it is possible. This is investment journalism, not financial advice.

Copyright 2018 William P. Meyers