Analyst Conference Summary



conference date: August 2, 2018 @ 5:30 AM Pacific Time
for quarter ending: June 30, 2018 (second quarter 2018, Q2)

Forward-looking statements

Overview: Still in partial clinical hold in pediatric tazemetostat trial. [wpm: stock price not likely to recover much until hold is resolved]

Basic data (GAAP):

Revenue was $12.0 million, up sequentially from $0.0 million, and down from $10.0 million in the year-earlier quarter. All revenue was from collaborations.

Net loss was $29.1 million, up sequentially from a loss of $34.1 million, and down from a $28.0 million loss year-earlier.

EPS was negative $0.42, up sequentially from negative $0.49, and up from negative $0.48 year-earlier.



Conference Highlights:

Robert Bazemore, president and CEO said “First and foremost, we are working diligently to resolve the partial clinical hold and resume enrollment in tazemetostat clinical studies. In addition, we are progressing tazemetostat toward a first NDA for the treatment of epithelioid sarcoma, continuing to advance its development in follicular lymphoma based on the strength of our clinical data, and advancing our novel inhibitor of G9a, EZM8266, toward the clinic. We believe the actions we have taken will allow us to capitalize on our near-term tazemetostat opportunities while also extending our cash runway."

Sees tazemetostat as potentially treating both solid and blood cancers, in multiple indications, and eventually in the first-line setting.

Epizyme has a global development plan for tazemetostat (an EZH2 inhibitor), in several cancer indications.

Tazemetostat in the EU has been granted orphan drug designation for follicular lymphoma, DLBCL, and mesothelioma.

In April repored the FDA placed a partial clinical hold on enrollment of U.S. patients. This was after one patient developed a secondary T-cell lymphoma in the Phase 1 pediatric trial. However, patients already being dosed are able to continue receiving tazemetostat. Epizyme emphasized there has been only 1 case of secondary lymphoma among 750 patients treated. Will work to address the hold.

Tazemetosta for epithelioid sarcoma trials had positive Phase 2 results that may qualify for accelerated approval (before a Phase 3 trial). Updated data from Phase 2 will be presented in October 2018, with an NDA delayed until the first half of 2019.. A confirmatory study is being prepared to support the registration strategy and full approval. ES is rare but usually deadly.

Tazemetosta for follicular lymphoma (a kind of NHL) Phase 2 study EZH2+ cohort positive interim data was reported in May. Epizyme will continue to work with the FDA to refine a registration strategy for accelerated approval. Already has orphan and fast-track status. A combination study is planned to start before the end of 2018.

Tazemetostat is in Phase 2 combination with prednisolone, RCHOP, and atezolizumab cohorts in relapsed/refractory DLBCL, (another kind of NHL) was discontinued after interim data showed insufficient efficacy.

Tazemetostat is also in a three-arm phase 2 study in adult patients with certain genetically defined, InI1-negative solid tumors.

In mesothelioma, Tazemetostat trial completed Phase 2 enrollment in Q2 2017. At ASCO reported the study achieved its primary endpoint, with a 51% disease control rate at 12 weeks (pre-specified threshold was 35%). FDA granted orphan drug designation for this indication.

A Tazemetostat study for pediatric patients with genetically defined solid tumors or NHL was started by the NCI in July 2017 with enrollment to complete in 2018.

A Phase 1b study of tazemetostat with Tecentriq for patients with with relapsed/refractory diffuse large B-cell lymphoma (DLBCL) was continuing by Genentech/Roche. Also planned is a similar trial in non-small cell long cancer.

A dose-escalation study of pinometostat in pediatric patients with MLL-r acute leukemia is continuing enrollment. Epizyme is partnering with Celgene for potential clinical development of pinometostat in combination with other agents.

EZM8266 for G9a [EHMT2] inhibition is in clinical approach, preclinical details were presented at ASH. It targets sickle cell disease. But Phase 1 won't start until 2019.

Epizyme has preclinical work underway with five new targets that are planned for introduction into the clinic by 2020.

Three programs are partnered with GSK and three with Celgene, including some that are undisclosed.

See also the Epizyme pipeline page.

Cash and equivalents ended at $215.6 million, down sequentially from $247.9 million. Epizyme believes it has sufficient funding though at least the fourth quarter of 2019. Longer if milestone payments are received or new partnership revenue comes in.

Operating expenses of $42.3 million consisted of $31.3 million for R&D and $10.9 million for general and administrative. Loss from operations was $29.1 million. Other income was $1.1 million.


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Disclaimer: My analyst call summaries may include both 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