WHWK

Ladies and gentlemen, thank you for standing by. Welcome to Whitehawk Therapeutics Fourth Quarter and Full Year 2024 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. I would like now to turn the conference over to Audrey Gross, Head of Corporate Communications for Whitehawk Therapeutics. Ms. Gross, please go ahead.

Thank you. Good morning, and welcome to the Whitehawk Therapeutics conference call. We will be presenting slides as part of the live webcast of this call. Such slides will be posted on the Investor News page of the Whitehawk Therapeutics website at whitehawktx.com following the conference call. A reminder that statements made on the call today will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our annual and quarterly filings with the Securities and Exchange Commission, which can be found at www.sec.gov or on our website at whitehawktx.com. In addition, any forward-looking statements made on this call represent our views only as of today, March 19, 2025, and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. On the call today is Dr. Dave Lennon, our President and CEO; Scott Giacobello, our CFO; and Dr. David Dornan, our newly appointed CSO. Today, we will introduce Whitehawk Therapeutics and provide an overview of Q4 and full year 2024 financial results before turning the line open for questions. I'll now turn the call over to Dave. Dave?

Thanks, Audrey. Hello, everyone. Good morning. Thank you for joining. I'm Dave Lennon, the President and CEO of the newly launched Whitehawk Therapeutics. We are extremely excited about the transformation from Aadi Biosciences to Whitehawk. I look forward to walking you through our vision, strategy, and opportunity, and what we -- the opportunity we have to deliver a meaningful impact for patients with our advanced ADC portfolio. As a reminder, in December, we announced a series of strategic transactions, including the in-licensing of 3 ADCs from Wuxi Biologics, the divestiture of FYARRO to Kaken Pharmaceuticals, and $100 million pipe financing that were subsequently approved during a special meeting of stockholders last month. As a next step in our evolution Aadi Biosciences is now divided into two organizations. Upon the divestiture of Aadi's subsidiary to Kaken. Kaken will assume ownership of the Aadi name, trademark, and the FYARRO business. And today, Aadi Parent Company, relaunches as Whitehawk Therapeutics, formalizing our transition into an ADC-focused company. While we remain rooted in our legacy, that is to make bold choices in applying technology to deliver improved precision oncology therapies, Whitehawk carries several important distinctions. As Aadi, we were focused on mTOR inhibition in rare cancer settings and were built on the foundation of a single commercial product. Conversely, Whitehawk is focused on rapidly progressing a multi-asset portfolio of advanced ADC therapy, all with the broad potential to make a meaningful difference in a large number of different cancer populations. Turning to Slide 6, as Whitehawk, we developed a framework that establishes a clear value proposition and investment thesis as an ADC company. Firstly, we are building on the foundation of established tumor biology. We are deliberate in identifying promising tumor targets that are both clinically validated and broadly overexpressed. By leveraging clinical validation, we know we have drug-able tumor targets. And because these targets are broadly overexpressed, we can apply them to high-potential cancer indications with significant patient populations and unmet needs. While first-generation ADCs offered significant advances for patients, we know they were hindered by limitations largely driven by lack of therapeutic index. To overcome these challenges, we are applying an advanced ADC platform technology that is engineered for minimal off-target toxicity, greater stability and higher therapeutic index compared to first-generation predecessors. Lastly, we are hyper focused on speed and efficiency to major data inflections. We are rapidly advancing our portfolio to the clinic with INDs for all three candidates anticipated in the next 15 months. So what are these candidates? Looking at Slide 7, our portfolio consists of three assets focused on validated tumor targets. HWK-007 targets protein tyrosine kinase 7 or PTK7. PTK7 is an oncofetal pseudokinase that drives early embryonic development. Subsequently as minimally expressed in adult tissues but becomes highly overexpressed in a broad range of tumors as they arise. There are no approved PTK7 ADCs, though it is becoming a popular target for research given this broad and deep overexpression in multiple cancers. HWK-016 is the only known ADC that targets the membrane-bound portion of MUC16, a glycoprotein with low level of expression in normal adult tissues, but often overexpressed and even shed from tumors of female origin, including ovarian cervical and endometrial cancers. Shed MUC16, better known as CA125 is a biomarker for cancer screening and disease monitoring, especially in ovarian cancer. So MUC16 is a widely utilized and clinically validated target for ovarian cancer and was previously studied as an ADC target by Genentech, who had two different ADCs against MUC16. And we have HWK-206, which is designed to address the neuronal target seizure protein 6 or SEZ6. SEZ6 is a CNS limited protein overexpressed in tumors of neuroendocrine origins, most prominent example includes small cell lung cancer. Small cell lung cancer is an aggressive high-grade neuroendocrine carcinoma, which limited targeted their treatment options exist and class competition is limited. To our knowledge, AbbVie is the -- has the only SEZ6 ADC currently in development. Underlying each of these programs is the advanced ADC technology platform developed by HANGZHOU DAC, known as CPT113. This advanced ADC architecture is based on the novel TOPO1 payload and a highly stable linker chemistry. Though not part of this portfolio, it's important to note that HANGZHOU DAC has two internally develop programs utilizing the exact same platform, DXC006 and DXC1002, these had successful INDs and are currently in dose escalating Phase 1 clinical trials in China. Turning to Slide 8. As you can see, we're working toward rapidly filing INDs with a plan to submit all three INDs in 15 months, as I said. To reiterate, these assets are designed to target proteins that are broadly expressed across multiple tumor types with significant unmet needs. This slide highlights the cancer indications where these targets have established clinical data from previous ADCs and also shows the numerous expansion opportunities showcasing the substantial market potential of the entire portfolio. Starting with HWK-007, this candidate represents a different opportunity -- sorry, differentiated opportunity potentially be among the first wave ADCs in clinical development for high-expressing PTK7 cancers. HWK-007 is currently being evaluated in IND-enabling studies. The Phase 1 trial is planned for non-small cell lung cancer and platinum-resistant ovarian cancer with the potential to spend into novel indications, including the full range of gastrointestinal in gynecological cancers. HWK-016 targeting membrane-bound MUC16 is currently being evaluated in IND-enabling study. The Phase 1 trial is planned in ovarian cancer with the potential to expand in additional indications such as endometrial, cervical, and pancreatic cancers. HWK-206 starting SEZ6 is currently in candidate selection, the Phase 1 trials planted in small cell lung cancer and neuroendocrine neoplasias where there are limited treatment options today. Turning now to more detail on the platform on Slide 9. First-generation ADCs were challenged by the high free payload release in circulation, limiting their therapeutic window as high free payload can generate significant off-target side effects. Advanced ADC platforms that are in development today, including the CPT113 platform we utilize across our portfolio, are improving on the limitations of first-generation platforms by engineering three critical components: one, payload. We use TOPO -- a proprietary TOPO1 inhibitor payload that minimizes off-target effects and supports higher therapeutic index; two, linker design. We use a highly stable cleavable linker that supports low free payload release in circulation; and three, pharmacokinetics profile, the ability to support higher DAR with an enhanced PK profile enables optimal dosing. The right-hand side of this slide highlights the generalized concept of therapeutic index improvements that you can expect by implementing an advanced ADC platform as compared to first-generation ADCs. With advanced ADC platforms, we're expanding the lower bound of the minimally effective dose with more potent targeting and increasing the upper bound of maximally tolerated dose with optimized payloads. We, thereby, are increasing the potential dose intensity for which we can treat patients and improve efficacy. To further illustrate this point, let's turn to the next slide. On Slide 10, you can see that we are looking at examples of how a switch from first-generation ADC platform delivers substantial efficacy gains in real-world examples. I won't go through all of these, but as you can see it, agnostic to target or indication, switching from an older platform to advanced ADC technology platform generated notable objective response rate gains ranging from 16 to 45 ORR point improvement. On average, we see a 30-point improvement in the typical switch. This along -- this is alongside coinciding with notable improvement in durability of response, thereby advanced ADC platforms have the potential to disrupt the standard of care for treatment options today and have demonstrated the ability to help many more patients by increasing response rates and time line therapy. So now if we move to Slide 11, we can apply this example to our own portfolio. Starting with PTK7 and share why specifically we're so excited about the potential of our assets. We want to start with the fact that PTK7 has precedented data from Pfizer's first-gene MMAE-based ADC, cofetuzumab pelidotin. Response rates seen in Phase 1 trials were across a range of tumor types tested, including ovarian, lung, which are shown here. Response rates were particularly robust in moderate and high expressing groups with ORR up to 46%. Despite these encouraging signals, co-compete was limited by the reduced dose intensity in narrow therapeutic index driven by toxicities consistent with class effects from the first-generation payload MMAE. So what happens if we apply an advanced ADC platform to this validated tumor target. On Slide 12, what these graphs represent is first placement of the Phase 1 cofe-p data in the context of currently approved late-stage ADC benchmarks for efficacy in lung and ovarian cancer. HWK-007 is a PTK7 switch to an advanced platform. And therefore, if we extrapolate from prior examples, we may expect to generate efficacy gains of 15% to 30%, points more in objective response rate over cofe-p. This level of improvement will be disruptive to first-generation ADC standards of care in lung and ovarian cancer. In both indications, we believe they have an opportunity to significantly surpass the established ADC efficacy bar, representing a meaningful clinical benefit to patients. And this is just the example for HWK-007 and PTK7. We expect similar improvements with our other two programs, which also take advantage of tumor targeting advances in addition to the advanced ADC platform switch, like we show here. We are enthusiastic about the potential of our portfolio and look forward to getting into the clinic quickly. With that, I'll now turn it over to Scott for updates on our financial progress. Scott?

Thanks, Dave. Moving to Slide 14. We ended 2024 with $47.2 million in cash, cash equivalents and short-term investments. Following the close of our recent strategic transactions, we expect to have cash and cash equivalents in the range of $170 million to $180 million, including the payment of the upfront and early milestones under the ADC license agreement. We anticipate that cash will fund operations into 2020 based on current plans. FYARRO net product sales were $7.2 million for the fourth quarter, representing 14% growth over the prior year quarter. Full year FYARRO sales were $26 million, an increase of 7% over 2023. Research and development expenses for the quarter increased to $14.3 million compared to $12.8 million in the prior year quarter. For the year, R&D expense amounted to $51 million compared to $48.9 million last year. This increase is driven mainly by in-process R&D expenses of $6 million related to the recently acquired ADC programs, offset in part by reductions in clinical expenses, personnel, and other expenses. Selling, general and administrative expenses for the fourth quarter were $11.1 million compared to $10.3 million in the same period in 2023. This increase was due mainly to increased legal and consulting expenses offset in part by lower commercial expenses. For the year, SG&A expenses decreased to $36.7 million compared to $44.5 million in the prior year, driven primarily by reductions in commercial and personnel expenses. Operating expenses for the year included $2.6 million of restructuring costs. Net loss for the fourth quarter was $18.3 million compared to $16.3 million in the fourth quarter of 2023. Net loss for the year was $63.7 million compared to $65.8 million in the prior year. I'll now hand the call back over to Dave for his closing comments. Dave?

Thanks, Scott. Looking to Slide 16. We are enormously excited about the potential of Whitehawk to make a transformative impact to patients with our portfolio. We're advancing three clinically validated tumor targets using next-generation ADC technology with the goal of outperforming first-generation predecessors. With a focus on high potential indications, we aim to file three U.S. INDs within 15 months. And we're well positioned to fund operations, as Scott said, into 2028, covering anticipated clinical inflections. Importantly, Whitehawk is backed by an outstanding veteran team. I'm also pleased to say this includes our recent addition of David Dornan, who joined us as Chief Scientific Officer. Many of you will know David, as the former CSO of Elevation Oncology. David contributes more than 2 decades of experience in oncology drug, discovery and development with deep expertise in ADCs and other targeted cancer therapies. He has a successful track record of separating drugs from discovery stage through the clinic for advanced modalities, including ADCs, encompassing numerous INDs, NDAs and BLAs. His experience at Elevation is particularly relevant as the spearhead of the company's strategic pivot towards a portfolio of ADCs. We welcome David, and glad he is able to join us on the call today. With that, I'll open the call for questions.

Thank you. [Operator Instructions] And the first question will come from Tara Bancroft with TD Securities.

Hi, this is Greg Weasner on for Tara Bancroft. So considering that Regeneron is developing a Mucin 16 targeted bispec antibody for ovarian, how do you anticipate that the clinical activity and safety profile of your ADC might compare to the bispecific approach within this indication? Thank you.

Super. Thanks, Greg, for stepping in for Tara, and thanks for the question. I'll start a little bit and then turn it over to David for his comments since he is an expert in this target. I mean the first concept is, obviously, ADCs and bispecific TCEs are very different modalities in terms of their mechanism. Certainly, there's commonality in the tumor targeting. And we're encouraged by the fact that Regeneron uses the same targeting approach to the membrane-bound type MUC16. But obviously, as a TCE that is targeting an immune modulating response, which will be very different from an ADC chemo-based response that we're developing here. We think both are complementary and important options for patient treatment regardless of the tumor target here. So we don't necessarily have a direct comparison we would highlight for this indication, but we do, obviously, pay close attention to that program. But David, do you want to say a little more about MUC16?

Yeah, sure. I think this is what is fair to say with respect to targeting, obviously, the membrane portion that we're targeting MUC16 certainly makes it help avoid antigen sync, as Dave has mentioned in the presentation. And with respect to the different modalities of targeting, I think you specifically asked about the CD3 redirection approach. I think it's fair to say like a CD3 redirection approach, sometimes they have challenges with like a cytokine release like syndrome. So obviously, as a cytotoxic ADC, we don't have the same AE problems in that realm. But obviously, with our ADC, cytox ADCs, they certainly have their own profiles, but the promise of our technology using our stable linker technology really will mitigate that potential risk. And so that's how we feel that positioning wise that this ADC will certainly be differentiated from a CD3 redirected, but largely would have significant gains and efficacy, as Dave already mentioned.

Thanks, Greg. Operator, next question?

And our next question will come from Roger Song with Jefferies. Your line is open.

Good morning, thanks for taking our question. This is Liang Cheng on for Roger. First, congrats on the new chapter. So I guess, question from us. One is on the three targets. So understanding the prevalence there. So maybe could you help us understanding about the distribution of the high, medium, low expression levels for each of these three targets. And the second question is about the financials. So understanding about 2028 runway. So does that cover all the three Phase 1 studies? Thank you.

Liang, thanks again. Thanks for joining the call. Good to hear from you again. And thanks for the questions. So on the first question, in terms of the prevalence, obviously, there's a lot of data to cover in context. What we would say is that, first on PTK7, it is one of the most broadly overexpressed tumor targets in development today. And so it impacts a large portion of patients who develop cancer overall, very highly expressed target, also a broad range of tumor types. What we really like about this target is that when it is expressed in patients, it's often expressed at a moderate to high level. So we'll generally find that the majority of patients who express PTK7 do so across different cancers, which we know correlates with potential for improved responses as patients who have higher expression generally responding better. And so we're really encouraged by both of those, the broad expression of PTK7, but also the relatively deep impression that we see in individual patients, a high proportion of patients that potentially could respond very well to therapy. On MUC16, it's a similar story. But I think in MUC16 case, we really have an advantage that MUC16 is a tumor target that tends to increase as the disease progresses and so higher expression is often associated with worse disease. And that is -- allows us to really target the patients who are most in need of care. And secondly, with the circulating CA125, we have a proxy for expression across patients rather than looking at IHC-based expression, we can also screen patients using circulating CA125 biomarker. And so we think, in this case, we really have both this high-level compression, particularly across gynecological cancers, deep expression overall, and ability to monitor that from [Indiscernible]. And then SEZ6. SEZ6 is highly impressed across a broad range of -- well, across the full range of small cell lung cancer. And this has already been typified by AbbVie's program where they're actually not selecting patients with extremely high response rates for non-selected small cell lung cancer patients on that SEZ6. So overall, I think these are not only really interesting targets for the fact that they have key roles in each of these indications, but they're highly and deeply expressed across the vast majority of patients [Indiscernible]. And as well, as we mentioned before, are not yet so competitive, like the TROP2 area or Claudin18.2 or other areas that we believe would be first or second to market on each of these indications or each of these targets. And then your second question on data availability. Our goal is to get meaningful clinical Phase 1 data for all three programs under the current funding that will obviously be slightly different amounts of data for each program, just given that they are staggered by a few months each. But ultimately, our goal in establishing Whitehawk as we did and capital as it is was to ensure that we would generate that meaningful clinical data before our next go back to the market for additional financing. Thanks for the question. Operator next question?

I show no further questions at this time in the queue. I would like to turn the call back to Dave for closing remarks.

Thank you, operator, and thank you to the team and everyone who joined us on the call today. We are really excited about the launch of Whitehawk Therapeutics, a new ADC company out of the transformation we've just performed with Aadi Bioscience. We reiterate these three clinically validated broadly overexpressed tumor targets are leveraging an advanced ADC linker payload architecture with key features that we believe will allow us to outperform first-generation ADCs. We're moving quickly, targeting filing of three U.S. INDs in the next 15 months, including HWK-007 in the second half of 2025, and HWK-016 by the end of this year. With our experienced team and collaborative partners, we are singularly focused on executing to ensure these goals are met. Lastly, upon closing, we expect we will capitalize. And as I mentioned, we have cash to fund our operations into 2028 and with anticipated key clinical data. So thank you for joining us for this introduction of Whitehawk Therapeutics and have a great day.

This concludes today's conference call. Thank you for participating. You may now disconnect.

Good day and thank you for standing by. Welcome to the Aadi Bioscience Inc. Second Quarter 2024 Earnings Call. At this time, all participants are in a listen-only-mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. Now I will turn the call over to Audrey Gross [ph], Head of Corporate Communications for Aadi Bioscience. Ms. Gross, please go ahead.

Thank you. Good morning and welcome to the Aadi Bioscience conference call to provide an operational update and review results for the second quarter of 2024. We will be presenting slides as part of the live webcast of this call. Such slides will be posted on the Investors & News page of the Aadi Bioscience website at aadibio.com following the conference call. A quick reminder that statements made on the call today will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties, and other factors, including those set forth in the risk factors section of our annual and quarterly filing with the Securities and Exchange Commission, which can be found at www.sec.gov or on our website at aadibio.com. In addition, any forward-looking statements made on this call represent our views only as of today, August 07, 2024, and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. On the call is Dr. Dave Lennon, our President and CEO; Scott Giacobello, our CFO; and our Chief Medical Officer, Dr. Loretta Itri. Today, we will provide an overview of operational activity and financial results for the second quarter of 2024. We will then open the line for questions at the end of the call following closing comments. I'll now turn the call over to Dave for his opening statement. Dave?

Good morning, everyone, and thank you for joining us today to review our financial and operational results for the second quarter of 2024. I'd also like to take this opportunity to refresh everyone on Aadi's story where we are today and where we're going in the weeks and months ahead. On Slide five, you'll see at Aadi, we are focused on unlocking the full potential of mTOR inhibition by uniquely combining nab technology and the potent mTOR inhibitor sirolimus. With more complete mTOR target inhibition, greater tumor suppression and a wider therapeutic index, we believe nab-sirolimus has the potential to build on previous mTOR inhibitors to deliver better outcomes for people living with cancers that are dependent on that pathway. We've established the value of this approach with FYARRO for the treatment of advanced malignant PEComa, an ultra-rare soft tissue sarcoma with poor outcomes and high biological evidence of the mTOR pathway activation. FYARRO has cemented its position as preferred treatment for malignant PEComa after just two years on the market. Since launch in February 2022, we have achieved $51.1 million in sales. We're proud of the impact FYARRO has had and will continue to have for patients with this rare and aggressive cancer. Building on this commercial backbone, we're also exploring nab-sirolimus for larger indications across multiple types of mTOR driven tumors. Most advanced of these studies is PRECISION1, a registration-intended tumor-agnostic trial in patients with solid tumors harboring TSC1 or TSC2 in activating alterations. This trial is fully enrolled and expected to complete by the end of the year. In a moment, I'll talk more about PRECISION1 and the opportunity it represents for patients and providers. We're also evaluating nab-sirolimus into mTOR driven cancers with promising potential. The first is advanced or recurrent endometrial type endometrial cancer or EEC, in combination with the aromatase inhibitor, letrozole. Endometrial cancer is the most common cancer of the female reproductive tract and one of the few cancers with increasing mortality. There's an estimated 10,000 cases of EEC diagnosed annually in the U.S. alone. Prior clinical studies of mTOR inhibitors combined with letrozole have yielded promising results and recent changes in the recommended standard-of-care for early-stage disease creates a potential opportunity for this combination to be used in the first and second-line settings. The second trial is in neuroendocrine tumors of lung, gastrointestinal tract, and pancreas. Neuroendocrine tumors or NETs are rare and have historically low response rate to treatment with oral rapalogs and other agents, which nonetheless are used clinically and recommended in treatment guidelines. In preclinical animal models, nab-sirolimus demonstrated improved target suppression relative to other mTORs, warranting further explanation of nab-sirolimus in this indication. These Phase II open-label studies are both enrolling well, and we look forward to presenting initial data from these trials later this year. Aadi is led by an accomplished team with deep expertise and a track record of responsible capital management with sustained commercial success of PRO, cash runway is anticipated to extend into Q4 2025, with a catalyst-heavy 2024 and 2025 ahead of us. We believe Aadi is well positioned to achieve our goals. Now turning to Slide six. As mentioned, PRECISION1 is registration intended tumor-agnostic trial evaluating patients with solid tumors harboring either TSC1 or TSC2 inactivating alterations. As of May, the trial has fully enrolled 120 patients across a broad array of tumor types. TSC1 or TSC2 driven cancers are found across a wide range of tumor types, clustering in the lung, gastrointestinal, general urinary breast and gynecological locations and are often difficult to treat. Although PRECISION1 is a single trial, TSCI and TSC2 arms are independently evaluated and effectively be viewed as two separate studies, each with its own outcome. Importantly, by design, patients in PRECISION1 have received all standard therapies appropriate for their tumor type and stage of disease. Or, in the opinion of the investigator, the patient would unlikely to tolerate or derive clinically meaningful benefit from the appropriate standard-of-care. In essence, for most patients enrolled in this study, this means they have limited, if any further treatment options, and an extremely poor prognosis. By the design of this trial, nab-sirolimus is the last available line of systemic therapy for these patients and truly test the ability of nab-sirolimus to address TSC1 and TSC2 mutated cancers in the sickest patients. We remain on track for our next plan interim readout, which is expected in Q3 2024. This analysis will include a total of 80 patients who have been followed for a minimum of six months and we'll evaluate the primary endpoint of the study, independently assessed overall response rate. Now looking at Slide seven. As a reminder, in Q4, we provided top line results for the planned interim evaluation of the first 40 patients enrolled in PRECISION1. These data demonstrated sustained tumor reductions in a heavily pretreated population based upon investigator-assessed responses across both arms. For TSC1, we reported an investigator-assessed overall response rate of 26%, which was within the range of our expectations. These responses appear to be early, deep and durable, which is especially noteworthy given this heavily pretreated population with a median of three prior lines of therapy. These responses were seen across four different tumor types, potentially supporting a tumor-agnostic indication. For the TSC2 arm, we reported 11% overall response rate. This arm had a median of 3.5 prior treatments, including 50% who had at least five prior lines of therapy. To put these early interim data in context, the overall response rate for the Phase II trial of Everolimus in a pan-cancer cohort of patients with mTOR pathway alterations was 8% for TSC1 and 6% for TSC2, both in slightly earlier lines of treatment. While this isn't a one-to-one comparison and studies have important differences, these historical data are helpful as we think about the clinical significance of the responses we reported in the first interim analysis, especially in light of the late line of treatment. I also want to highlight that ongoing conversation with experts reinforce this view. We have heard from key opinion leaders that these data are compelling, especially for tumor types in late line for whom disease control is a meaningful outcome. Now turning to Slide eight. It's important to note that PRECISION1 closely follows the most up-to-date guidance from regulators on how they would like to see tumor agnostic studies for targeted therapies run. As we've reiterated today, PRECISION1 is a truly tumor-agnostic trial, enrolling any solid tumor type harboring a TSC1 or TSC2, inactivating alteration. By design, PRECISION1 will not have more than 25% contribution of enrollment from any two tumor types combined. Additionally, patients in PRECISION1 are heavily pretreated with a median of three prior lines of therapy as reported in our December interim data. By contrast, when we look at other targeted therapies that have gained approval in the past, they relied on a cohort approach with significant enrollment from just one or two tumor types, as much as 79% in one case. Patients also appear to be less advanced with these interventions often coming in earlier line settings, which impacts the overall response rate seen in these trials. Based on these precedents, we feel confident in the design of PRECISION1 to meet the standard established for this type of study. We continue to believe that should these results were reported in the one third interim hold or improve in a larger group of patients, we have a path to submission and potential approval for TSC mutations. Now looking at the market opportunity on Slide nine. TSC1 and TSC 2 mutations define a large mutation-driven oncology population with broad distribution amongst tumor indications and specialties. Our latest internal analysis indicates there's approximately 16,000 patients with TSC 1 and 2 mutations across a variety of tumor types, and these mutations are roughly evenly split between genes. Notably, we are seeing an increasing utilization of NGS testing by oncologists to help inform treatment decisions. There are some populations, in particular, for whom NGS testing is more common, so-called high NGS testing specialties. Nearly half of TSC1 and TC2 tumors present in these high NGS testing specialties, which include tumors of gynecological and thoracic origin as well as melanomas and sarcomas. These physicians see roughly half of all TSC1 and TSC2 positive cancers. According to our research for the product profile similar to our interim results to date, high NGS testing specialties indicate they would likely they would be likely to use nab-sirolimus after second and third-line preferred treatments, which aligns with what we've observed in Precision1. We anticipate that market adoption would be led by these specialties with initial uptakes occurring in later line settings where patients are often thoroughly tested for mutations and physicians are looking for unique treatment options. Even if we limit the majority of nab-sirolimus utilization to be in the third line with these high NGS testing segment, TSC1 and CSCI mutated cancers would represent a significant $300 million to $600 million projected market opportunity in the U.S. alone. So if PRECISION1 delivered similar results to our prior interim analysis, we know there is a significant unmet need that we're addressing. We remain confident that we've designed and conducted the appropriate tumor-agnostic trial for the FDA, and we remain bullish on the significant commercial potential for nab-Sirolimus beyond become. With that, I'll now turn it over to Scott for updates on our Q2 financial progress. Scott?

Thanks, Dave. Looking at Slide 11 and starting with FYARRO. FYARRO product sales were $6.2 million for the second quarter, in line with the prior year period and up 15% over Q1. In the quarter, we saw a 14% increase in the number of ordering accounts compared to the first quarter, and growth was observed across all segments, including large accounts. Since launch in February 2022, we've achieved $51.1 million in cumulative sales. FYARRO has a high demand and penetration across both academic and community settings, and we have seen the consistent addition of new accounts ordering FYARRO with more than 200 accounts ordering since launch. Turning to Slide 12. We ended the second quarter of 2024 with $78.6 million in cash, cash equivalents and short-term investments. Responsible capital management continues to support a healthy balance sheet and will fund operations into Q4 2025 based on current plans. Research and development expenses for the quarter amounted to $13.1 million compared to $13.3 million in the prior year quarter. R&D expenses were primarily related to the continued progress of the ongoing PRECISION1 trial in the programs in endometrial cancer and NET. Selling, general and administrative expenses for the second quarter was $7.9 million compared to $11.8 million in the same period in 2023. This decrease was driven mainly by reduced commercial, marketing and personnel expenses related to the rightsizing of our operations earlier in the year and reduced legal expenses versus the prior year quarter. Net loss for the second quarter was $14.6 million compared to $18 million in the second quarter of 2023. For more information on our financial performance in the second quarter, a detailed discussion of the results reported on this call will be provided in our Form 10-Q. I'll now hand the call back over to Dave.

As discussed today, we're making tremendous progress against our clinical development plans with two sizable markets in TSC1 and TSC2 in activating alterations as well as other mTOR driven cancers. On Slide 14, what you'll see is the back half of the year will be an important time for Aadi, and we look forward to providing the anticipated two thirds interim analysis from PRECISION1 later this quarter, and if appropriate, sharing those data with the FDA thereafter. We expect to complete PRECISION1 by the end of the year. Additionally, we plan to provide an initial look at data coming out of the EEC and NET trials by the end of the year as well. Looking ahead to 2025, we expect to have full results of PRECISION1. And if the data continue to hold, we believe this would form the basis of a filing with the FDA in 2025 as well. With that, we can now open the line for questions. Operator?

[Operator Instructions] And our first question comes from Roger Song with Jefferies. Your line is now open.

Thanks for that Dave for taking our question. Maybe we first talk about the PRECEISION, Dave, if we may. Understanding you will have the second interim data in 3Q. First of all, given the first-interim data, what kind of the expectation you have for TSC1 and 2? And the second part of the question is, you say you will discuss with the FDA with the second interim data? And then just curious to what would be the key topic there and then what could be the potential outcome out of the FDA discussion after second interim? I have a follow-up. Thank you.

Sure. Thanks, Roger. I'll make a couple of comments and ask Loretta if she has anything she'd like to add. Our PRECISION1 outcome in Q3 will be -- will present -- obviously, just a reminder, this is the primary endpoint analysis on two thirds patients, so 80 patients or 40 patients in each arm. The primary endpoint of independently assessed overall response rate after six months, minimum six months of follow-up, will be reported out along with key demographic and select secondary data. We -- I wouldn't draw any anticipation in terms of the direction of which we see that data going at this point in time. We'll have to wait for that report to see that. But those are the -- that's the information. If you want more specifics, just let me know the follow-up there. And then presumably, since this is representative of the primary endpoint and a preplanned interim analysis, we do think this would be a good foundation for data discussion, data-driven discussion, with the FDA on a potential path to submission, and that would be the goal of that next discussion with the FDA. Loretta, anything you would add to that?

No, Dave, I think you covered it nicely. Thank you.

Got it. Yes. Thank you. And then since the enrollment for the EEC and NET studies going pretty well. And then just curious what should we expect from the later this year initial data update? Will that be focusing on the -- maybe some of the safety [indiscernible] or you expect to see some clinical activity from those initial data results? And how many patients we should expect to see for the data? Thank you.

Yes. I'll let Loretta start by commenting on where we are with those trials, and I can follow up if anything to add. So Loretta, why don't you comment on this?

Sure. Thanks, Dave, and thank you for the question. For the EEC trial, we have been recruiting very rapidly and which I think reflects the support in the community for this combination. Currently, although we're not giving exact numbers, we have completed enrollment of the entire first cohort and we're well into the second cohort at this point in time. My expectation is that by the end of the year, we will be able to give a fairly full summer report on the first cohort of patients and probably some partial information on the second cohort. So that's EEC. And for the NET program, again, we are accruing quite rapidly, and I would -- I have full expectation that by end of the year, we will be able to report on the first cohort of patients quite completely. Dave, I don't know if you want to add something else?

That's great, Loretta. Thank you. The only thing I might add is, right, that these are two indications where there is precedent data with mTOR inhibitors. And so, one of the opportunities we have here is to compare what we know from prior studies with mTOR inhibitors in these indications to the data we're seeing with nab-sirolimus, which will be something we'll bring forward as we look at that data, depending on the patients that we enroll in these early trials.

Dave, if I might add, I just want to remind everyone that these studies are open label unlike PRECISION. So there will be no problem statistically with reporting the information. Thank you.

Thanks, Roger. Let's -- can we move on to the next set of questions?

Thank you. Our next question comes from Joe Catanzaro with Piper Sandler. Your line is open.

Hey guys, thanks for taking my question. Maybe following up a bit on sort of what happens post the second 2/3 interim analysis here in the range of outcomes. I'm guessing it's-- I'm wondering if there's any scenario in which the design and execution of the remainder of PRECISION1 is altered or changed in any way. I do recall maybe some speculation that there's a possibility of maybe increasing the target enrollment of the trial, again, depending on sort of the outcome. So maybe you could just speak a little bit more to that on sort of the various scenarios that may play out.

Sure, Joe. Thanks for the question. It's a good one. We have talked in the past about that ability to adjust the trial at this point in time. We will say that the trial has been fully enrolled at this point in time. And so we anticipate being able to report out on the full 120 patient data set in early 2025 once those patients have completed their follow-up period. And so we do feel we're in a good position on the full trial enrollment. In terms of -- so at this point, we don't anticipate any adjustments to the trial given the trajectory that we've seen so far. And we wouldn't anticipate that, that would be an outcome in the short term. That's -- of course, we still would be waiting for our data monitoring committee's recommendation on that as well as kind of internal deliberations. And any changes we do would be part of our disclosure when we report out that data later this quarter.

Okay. Got it. That's helpful. And then maybe one quick one on FYARRO. I know you've maybe previously have spoken to expectations to continue to see some incremental growth there. Just wondering if that's still your expectations and what would be sort of the driver of that? Thanks.

Yes. I want -- I mean, I would -- do want to highlight that we did have a low Q1, which we discussed had -- likely was being impacted by potentially some cannibalization we were seeing at some of our large centers. Importantly, in Q2, we saw a really strong rebound in demand across all of our key segments of business. And we do believe that that's being sustained as we go into the next quarter. And that we're seeing from a demand perspective, our demand numbers in Q2 actually outperformed what we saw net sales as we had some deductions on a gross-to-net basis related to inventory movements still in Q2. And so we remain very positive on the outlook for continued incremental growth in the business in Q3 and Q4 of this year.

Okay, great. That's helpful. Thanks for taking my questions.

Yes. Thanks, Joe. Next question, Operator?

Thank you. Our next question comes from Tara Bancroft with TD Cowen. Your line is open.

This is Greg Weasner [ph] on behalf of Tara Bancroft. Is there any particular tumor type that you're favoring at this point for future trials? Or will this continue to be a pan-tumor approach? And if it's the latter, what guidance does the FDA give for registrational trial requirements? Thank you.

Sure, Greg. Thanks for the question. We -- this is, as I pointed out, I think, and we tried to discuss deeper in the slides, this is truly a tumor-agnostic trial. And therefore, the FDA has no guidance on biasing the trial for any particular indications. And we certainly enroll any and all patients who qualify regardless of tumor type into the trial based on their TSC1/TSC2 status and a few other of the inclusion criteria. So we do believe that this will be conducted and reviewed as a tumor-agnostic trial. Our indication will not be tumor-specific. It will be for that tumor-agnostic label, assuming we submit and gain approval around that. And we don't -- just to reiterate, we don't anticipate or guide this trial PRECISION1 towards any specific tumor types. Obviously, we are very interested in thinking about our endometrial and neuroendocrine specific tumor indications where we know mTOR plays a role regardless of TSC1 and 2 status. And actually, those trials exclude patients with those mutations. And therefore, we are -- or we haven't had any -- I should say we haven't had any patients with those mutations in that trial. And so that's looking at the impact of the mTOR pathway in those specific indications where we know they are potentially more mTOR sensitive.

Okay. Wonderful. That's very helpful. And if I can just ask one quick follow-on question. Is there a particular conference that you're targeting for the second interim? Or would this be something that we can expect from a PR?

Yes, we would imagine this will be a company presentation at this point.

Thanks guys.

Our next question comes from Ahu Demir with Ladenburg Thalmann. Your line is open.

Thanks very much for taking my question. I appreciate the additional information with the results today. Two questions from us perhaps one more after the second question would be -- my initial question is, you mentioned the earlier lines of treatment, having a better impact as we have seen in many targeted therapies. Curious if you are planning to maybe disclose this data with the next data release? Are we going to see distinct populations where patients are treated more than three lines of treatment versus earlier lines of treatment? Are you planning to disclose that information?

We'll certainly disclose the response rate overall. I think the question, once we get the data, will be, did we see a difference between lines of treatment, is that meaningful given the data set that we have. So I think, Ahu, that would be a decision that's highly data dependent in terms of what we actually see from the patient population. I can say in the early line -- in the early interim we did in December, we didn't see any -- it was a very small data set, so it's hard to extrapolate, but we didn't see any particular pattern and we had responses spread across different lines of treatment.

Makes sense. And my second question is on the endometrial cancer program. You did mention the biggest idea of this trial is to compare it to the other mTOR inhibitors and the patient baseline demographics can impact the trial readouts significantly. So what was the other trial patient demographics look like? Are you planning to focus on those? Any particular populations that you would be targeting? Anything we should pay attention because sometimes it's very challenging when we are comparing apples to oranges and based on demographics that impacts a lot.

Yes. Understood. I probably oversimplified the comparison or a statement in that. So I'm going to allow Loretta to comment on kind of our strategy with the endometrial trial and where we think the real benefit is here for patients. Loretta?

Sure, Dave. Good morning. And thank you for that question. As usual, it's a good one. So the -- the design of the EEC study was largely based on an earlier study that was performed by GOG, the Gynecologic Oncology Group. This is a study GOG-209. And this is actually an older study that established platinum and paclitaxel as the standard-of-care for patients who had advanced endometrial cancer. And in that study, there was a cohort of patients who were chemo-naive. And in that group, they saw a response rate of about 51%. Now this was compared to a later study of the combination of Everolimus and letrozole in which the response rate in the chemo-naive patients was 47%. So not very different than what was seen with platinum and paclitaxel. But what was really riveting was the fact that the PFS reported for the platinum paclitaxel combination was 14 months, which is healthy. But for the Everolimus letrozole combination, it was 28 months, a doubling. And PFS in this population where quality of life is extremely important, really was what was the driver behind the design of our [Indiscernible] advanced stage endometrial cancer. We had an opening a chance to put this combination in frontline or in second line, in some cases, to take a look at how well it would work and to see if we could repeat or improve on the original Everolimus letrozole combination data in a chemo-naive patient population. So that was the basis of the study design and the community has been extremely supportive of this idea and has enrolled very rapidly because of their wish to replace, or try and replace, chemotherapy as frontline treatment for this population. I hope that helped.

Yes. Definitely. Thank you, Loretta.

Okay. As I mentioned, Ahu, I do it too simply Loretta does it wonderfully. So, thank you for the question. Do you have a follow-up?

Well, one last question I have, Dave, if I may. You have two distinct approaches to assess nab-sirolimus. So curious, when you talk to the KOL community. So where do you see the most excitement? Is it for more of the TSC1/2 approach, is agnostic approach? Or do you see more of an excitement for the endometrial and NET where there is an indication-specific approach?

I'll let Loretta comment first and then...

So first of all, they are totally different populations. Remember that your PRECISION, we are dealing with sort of a pan-representation of specialties. So they don't necessarily talk to each other. But the ones who do talk to each other remain really very bullish on the fact that we are seeing responses in some of these very sick, late-stage patients, as Dave mentioned in his commentary. It's perhaps easier to see the enthusiasm in the community for EEC, where these tend to be a group of specialists who are together all of the time. And they talk about this disease all of the time, and they treat the same kind of patients all of the time. So their excitement is palpable, and they are looking for the next big thing. So immunotherapy was, of course, big and changed the standard-of-care. And now they are looking for a way to replace chemotherapy. And they are hopeful and actually quite vocal that we will fill that gap. So that's as best as I can represent it, I think. Dave, you wanted to say something else?

I think that's a great summary of it, Loretta from first-hand experience. I would say we also went out with the TSC1 and 2 interim analysis, I mentioned and talked to a large number of physicians to get reactions to that profile and understand across different specialties what that reaction would be. And consistently, physicians are quite interested in finding solutions for late-line patients, particularly through targeted mutations where there's identifiable mutation and where often not just overall response rate, but even stable disease is a meaningful outcome for those patients who progress through multiple lines of therapy. And we had excellent reactions to the profile of nab-sirolimus especially amongst folks who are familiar with the mTOR pathway and/or doctors who have seen this product in the PEComa setting. So thank you, Ahu, for the questions. So, Operator, next question?

Thank you. Our next question comes from Robert Burns with HC Wainwright. Your line is now open.

Good morning. This is Dan on for Rob. Thanks for taking our questions. We wanted to ask, given the data demonstrating preferential tumor uptake for nab-sirolimus versus --sirolimus and Everolimus. Are you thinking of any drug combinations and subsequent target indications for the future? Or to rephrase: any ideas on future directions or expansions? And would you be able to give a little more color around when in this upcoming quarter you expect to report the interim analysis? And I'd like to have some follow-ups, if I could.

Sure. Thanks, Dan, for the questions. Yes. So I think as you point out, we do see that preferential accumulation of sirolimus in the nab-sirolimus combination driven by that nanoparticle-bound albumin technology, and we do think that's one of the key advantages that we have with this product. Obviously, the TSC1 and 2 trial is a monotherapy trial, so there's no combination there. But the EEC trial is in combination with letrozole and the NET trial is a monotherapy or in combination for functional tumors with standard-of-care. In terms of more exploratory combinations that would build on that, we're absolutely looking at those opportunities. But I wouldn't -- I think it's premature for us to comment about that. I think we're looking for these results from these initial trials over the second half to really set the path for the future. And then in terms of timing, all I can say is later in Q3.

Thanks. That makes sense. So regarding follow-ups, what are you looking for from the Phase II program in neuroendocrine tumors regarding efficacy and safety? And are there specific tumor types that you expect to see the greatest impact in? Do you have an update -- Sorry.

Go ahead. Finish.

Do you also have an updated view on what maximum sales and the PEComas could look like in the United States and around what that would be? And how did -- I'm curious on the paclitaxel versus Everolimus trial. How does those overall survivals compare -- back in the day.

I can.

Yes, I'll let Loretta take the first question. Go ahead.

Okay. So I'll take the last question first because I -- there were so many questions I kind of forgot what the earlier ones are, but I can tell you that the overall survival for the combination of paclitaxel and [Indiscernible], it was 32 months. So -- and it was not reported for the letrozole Everolimus combination. But if the PFS was 28 months, it isn't that far from 32 months overall survival. So you may assume that it was significantly better.

Loretta, thanks. The first question was in regards to the net trial expectations and any particular tumor types that we might see better responses.

Okay. He wants me to answer that. So...

Yes. Go ahead, thanks. If you could add.

So are you -- I wasn't clear with the question; whether you were talking about subtypes of NET because NET occur in different organ sites. We don't actually have enough information. If that is the question. We don't have enough information to know which of the subset NET is going to have a better response rate. You just don't have enough information at this point in time.

Yes. And Dan, if I can add on the NET trial. Historically, mTOR inhibitors have been utilized in the setting or in neuroendocrine tumors. The reality is that those -- I mean, those approvals were driven off of progression-free survival benefit that was demonstrated. NET can be quite indolent and long lasting. And -- but there is benefit that has been derived from mTOR inhibitors in terms of extending time on treatment for those patients relative to other approaches. The reality is though that those prior MTOR inhibitor trials show very low overall response rate, so often in the single-digit setting. And we think the -- an early indication of the potential of our MTOR inhibitor would be to show superior -- or not superior, but because it's not a direct comparison, but to show numbers that would be better in terms of initial response rates that could guide to kind of that longer-term better outcome for those patients. And then on the PEComa sales, we don't guide -- we haven't provided guidance to the ultimate potential in PEComa. What I would say is that PEComa is a very rare indication. We're talking 200 to 300 patients in the U.S. in total. That means we're finding one in a million kind of what we're looking for in terms of finding those patients and getting them to the right treatment setting. Many physicians will never see a PEComa patients. And so therefore, our goal is to continue to hunt and find these patients and make sure they're getting to the right treating physicians so they can get exposed to the potential for nab-sirolimus to support their disease journey. That ultimately is a -- it's hard to predict exactly where that can land over time. What we have said consistently is that we do believe we've penetrated most of the marketplace at this point and any further growth will be incremental.

That makes sense. And I apologize for the inundation of questions.

No worries. We take notes as we go. So, thank you, Dan.

I apologize for my short attention span.

Thank you. Operator, are there any other questions on the line?

I'm showing no further questions at this time. I would now like to turn it back to Dave Lennon for closing remarks.

Thank you, Audrey, Loretta, Scott, for your comments today. Thank you, everyone, on the call for joining us for today's call. We appreciate your time and look forward to the opportunity in the near future to provide additional updates on our progress. Otherwise, have a great wonderful rest of your day and week and look forward to speaking to you all soon. Thank you.

This concludes today's conference call. Thank you for participating. You may now disconnect.

Good day and thank you for standing by. Welcome to the Aadi Bioscience First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only-mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. Now I'll turn the call over to Audrey Gross, Head of Corporate Communications for Aadi Bioscience. Ms. Gross, please go ahead.

Thank you. Good morning and welcome to the Aadi Bioscience conference call to provide an operational update and review results for the first quarter of 2024. On the call is Dr. Dave Lennon, our President and CEO; Scott Giacobello, our CFO; and our Chief Medical Officer, Dr. Loretta Itri. Today, we will provide an overview of operational activity and financial results for the first quarter of 2024. We will open the line for questions at the end of the call following closing comments. A quick reminder that statements made on the call today will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our annual and quarterly filings with the Securities and Exchange Commission, which can be found at www.sec.gov or on our website at www.aadibio.com. In addition, any forward-looking statements made on this call represent our views only as of today, May 8th, 2024, and should not be relied upon as representing our view as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. With that I will turn the call over to Dave for his opening statements. Dave?

Good morning, everyone, and thank you for joining us today to review our financial and operational results for the first quarter of 2024. At Aadi, we're focused on unlocking the full potential of mTOR inhibition by uniquely combining nab technology in the potent mTOR inhibitor, sirolimus. We believe nab-sirolimus has the potential to deliver deeper inhibition of the mTOR pathway and ultimately better outcomes for people living with cancers that are dependent on that pathway. Today, I'm pleased to announce that a registration-intended PRECISION1 trial is now fully enrolled across a broad array of tumor types. This is an important milestone as we seek to understand the potential of nab-sirolimus for patients with solid tumors harboring either TSC1 or TSC2 inactivating alterations, a sizable market. Our latest internal analysis indicates there are approximately 16,000 patients with these mutations across a variety of tumor types, with mutations roughly evenly split between genes. Each mutation represents a potential multibillion-dollar total addressable market for nab-sirolimus. TSC1 or TSC2-driven cancers are found across a wider range of tumor types, clustering in lung, gastrointestinal, genitourinary, breast and gynecological locations and are often difficult to treat. We believe PRECISION1 is a cutting-edge trial, testing our innovative therapy, nab-sirolimus in these cancers. Although PRECISION1 is designed as a single trial, each arm is independently evaluated, providing us with the ability to assess one arm separately from the other. Given this design, PRECISION1 can effectively be viewed as two separate studies, each with its own outcome. As a reminder, in Q4, we provided top line results from a planned interim evaluation of the first 40 patients enrolled in PRECISION1. These data demonstrated sustained tumor reductions in a heavily pretreated population based on investigator-assessed responses in the first 40 patients across both arms. Of note, for the TSC1 arm, we reported an investigator-assessed overall response rate of 26%, which was within the range of our expectations. These responses appear to be early, deep and durable, which is especially noteworthy given this heavily pretreated population with a median of three prior lines of therapy. Lastly, these responses were seen across four different tumor types, potentially supporting a tumor-agnostic indication. I want to highlight that ongoing conversations with experts reinforce our view of the clinical significance of the responses we reported from the first interim analysis, especially in the late-line treatment in both patient groups. We continue to believe that should these results hold or improve in larger group of patients, we have a path to submission and potential approval for TSC mutations. With the trial now fully enrolled, we remain on track for our next planned interim readout, which is expected in Q3 of 2024. This highly anticipated analysis will include a total of 80 patients, who have been followed for a minimum of six months and will evaluate the primary endpoint of the study, independently assessed overall response rate as opposed to our December interim analysis, which reported investigator-assessed responses. Looking ahead, we expect the study to be completed by the end of 2024 with full data in 2025. In addition to PRECISION1, the Phase II trials for two promising mTOR-driven cancer targets continue to enroll well. As a reminder on these two trials, the first is evaluating the therapeutic potential of nab-sirolimus in advanced or recurrent endometrioid-type endometrial cancer or EEC in combination with the aromatase inhibitor, letrozole. Endometrial cancer is the most common cancer of the female reproductive tract and one of the few cancers with increasing mortality. There is an estimated 10,000 cases of EEC diagnosed annually in the US alone. Prior clinical studies of mTOR inhibitors combined with letrozole have yielded promising results and recent changes in the recommended standard-of-care for early-stage disease creates a potential opportunity for this combination to be used in the first and second-line settings. The second trial is evaluating nab-sirolimus in neuroendocrine tumors, or NETs. NETs are rare with approximately 3,500 cases a year. NETs have a historically low response rate to the treatment with oral rapalogs or other agents, which nonetheless are used clinically and recommended in treatment guidelines. In preclinical animal models, nab-sirolimus demonstrated improved target suppression relative to other mTORs, warranting further exploration of nab-sirolimus in the clinical setting for NETs. We're excited about this trial because it provides the opportunity to demonstrate what we believe is nab-sirolimus' best-in-class efficacy in a known mTOR-sensitive tumor type. Overactivation and dysregulation of the mTOR pathway is commonly found in various tumors and the unique delivery and excellent safety profile of nab-sirolimus provides the opportunity to combat these difficult to treat cancers. As such, we think these are promising indications and are eager to present initial data from these open label studies later this year. As a final update to our development plans, today, we announced that we have terminated our collaboration and supply agreement with Mirati, now BMS. That was evaluating the combination of its adagrasib, a KRAS selective inhibitor, and nab-sirolimus in KRAS-mutant non-small cell lung cancer and other solid tumors. At our request, we mutually agreed with BMS to discontinue this early phase trial, which enables us to prioritize the evaluation of nab-sirolimus in our ongoing Phase II trials for the promising indications of EEC and NETs. Turning now to FYARRO. FYARRO continues to perform well with net product sales for the quarter of $5.4 million. For a bit of context, this is a decrease from prior year and reflects Q1 changes in distributor ordering patterns and fewer new commercial patient initiations in Q1 than historical average. Swings in what is actually a very small number of patients may be due in part to cannibalization at top accounts, where we're seeing robust enrollment into our current clinical trials. We believe this will correct itself in subsequent quarters and we expect a return to sales growth in Q2. FYARRO has cemented its position as the preferred treatment for malignant PEComa after just two years on the market. We have high penetration across academic and community settings and have seen the consistent addition of new accounts ordering FYARRO every quarter now with more than 200 accounts ordering since launch. We are proud of the impact FYARRO has had and will continue to have for patients with this rare and aggressive cancer. With sustained commercial success of FYARRO, cash runway into Q4 2025 and a catalyst heavy 12 months ahead of us, we are well positioned to realize our ambition of becoming a multi-indication precision oncology company. I will now turn the call over to Scott for updates on our financial progress. Scott?

Thanks, Dave. We ended the first quarter 2024 with $88.3 million in cash, cash equivalents and short-term investments. Responsible capital management, including measures implemented in early 2024 to streamline our operations and reduce costs, continue to support a healthy balance sheet that will fund operations into Q4 2025 based on current plans. FYARRO net product sales were $5.4 million for the first quarter, representing an 8.8% decrease from the prior year period. As Dave mentioned, this decrease was due in part to distributor ordering patterns in Q1, which we expect will correct in future quarters as well as lower commercial patient initiations. Research and development expenses for the quarter increased to $13.6 million compared to $11 million in the prior year quarter. This increase is primarily related to the continued progress of the ongoing PRECISION1 trial, which is now fully enrolled and the programs in endometrial cancer and NETs. Selling, general and administrative expenses for the first quarter were $10.6 million compared to $11.2 million in the same period in 2023. This decrease is due mainly to reduced legal and consulting expenses versus the prior year, offset in part by severance costs related to the streamlining of our operations. Net loss for the first quarter was $18.3 million compared to $15.2 million in the first quarter of 2023. For more information on our financial performance in the first quarter, a detailed discussion of the results reported on this call will be provided in our Form 10-Q to be filed later today. I'll now hand the call back over to Dave for his closing comments. Dave?

Thanks, Scott. I'm proud of the strides we've made already this year. We're making tremendous progress against our clinical development plans with two sizable markets in TSC1 and TSC2 inactivating alterations as well as other mTOR-driven cancers. We look forward to providing a highly anticipated two-thirds interim analysis from PRECISION1 in the third quarter and is sharing an early look from our Phase II trial later this year. Now we can open the line for questions. Operator?

Thank you. [Operator Instructions] Our first question comes from Roger Song with Jefferies. Please go ahead.

Great. Thanks for the update and taking our question. Maybe just quickly on the EEC and NET. Curious about the expectation into the initial data readout later this year, particularly the patient numbers and how much efficacy we're going to see versus the safety and et cetera? How meaningful that data update will become? Thank you.

Great. Thank you, Roger. So on the EEC and NET trial, remember that these are two-part Phase II studies and the initial Part 1s enroll approximately 10 patients in each trial. We anticipate we'll be able to report out early efficacy data and safety data on those initial Part 1s by the end of this year. Loretta, anything you would add to that?

Only that the recruitment is going well and as anticipated and I don't think we're going to have any problem reaching the ends that have been determined in the Simon's 2-stage design. So, yes, I think we're on target to report our results, as Dave just mentioned.

Yes, Roger, we're very encouraged by both of these trials on both because there's been great interest in the community in these combinations and then exploring the potential of nab-sirolimus to improve upon what has been seen before with prior mTOR inhibitors in these -- both of these spaces. So hopefully we'll see that pull through as we report out the first parts of this data. Thanks.

Yes. Yes, thank you. Yeah, that's very helpful. And in terms of the FYARRO, the sales trajectory, understanding the 1Q seems a little bit kind of off compared to historical average, but any color around the parameters in terms of the first-line use, duration on treatment and maybe some repeat dosing for those existing patients? And maybe also curious as to what's the feedback from the field from your PRECISION results, maybe some impact to the FYARRO sales. Thank you.

Yes, sure. So two parts to that in a sense. So let me cover first, on the parameters, we look at in terms of physician adoption, awareness, first-line uses, et cetera, all of those were extremely strong for us as late as we've looked at that data. And so we see no real changes in the community's attitude towards FYARRO and its use in PEComa. We are in a more steady-state situation with incremental sales growth, and we expect some variations quarter-to-quarter to occur. And as I think we indicated a little bit in Q4, we expected Q1 could be a lower quarter for us in this -- in the course of this year. Importantly, we remain -- the adoption remains very robust and it's really a small swing in new patient starts that has impacted FYARRO here. About half of that impact is driven by what we see in demand with new patient starts in some of our largest centers. These also correlate with the largest centers, where we've enrolled a large number of patients in PRECISION1 over the course of the last six to nine months. And recall that we have usually anywhere around 90 patients commercially on drug at any one time. And over the last nine months, we've recruited 80 patients into the PRECISION1 trial. So typically, clinical trials aren't of the same scale and magnitude as a commercial business. But in this case, that is -- we're more aligned in terms of what we're doing in the clinical trial side versus what's happening on the commercial side. Maybe I'll just let Scott talk about the distributor situation and then I would like to go to Loretta to talk a little bit about the physician responses to PRECISION1.

Yes, sure. Thanks, Dave. Yes, on the inventory side, as we noted, we saw some swings in distributed inventory in the quarter, which is -- we're at an unusually low level at the end of Q1 based on what we've seen in recent quarters. And so we do expect that that's going to work itself out over the next few quarters.

And then, Loretta, I just want a comment maybe on what we saw from investigators on the PRECISION1 interim results and their response and particularly how that led through the recruitment.

Well, the responses that we saw at the first interim, actually had virtually no impact on our accrual. The community remains very supportive of this study. We didn't miss a beat. And frankly, given the very advanced stage of many of these patients. Remember that the median of prior therapies was 3 to 3.5, with many patients having received more than 5 prior regimens. So to the community that treats these patients, the responses that we saw looked pretty good. And so everyone remains enthusiastic and we have not missed a beat in terms of our accrual. In fact, we had a small uptick. So I don't know if that's what you wanted me to say, Dave, but that's the reality.

I always want you to say the reality, Loretta. Thank you. Thanks, Roger. Any other questions?

No, that's helpful. Thank you. Thank you for taking the question.

Thanks. Operator, next question.

Thank you. One moment for our next question. Our next question comes from Joe Catanzaro with Piper Sandler. Please go ahead.

Hey, everybody. Appreciate you taking my questions. Just have a couple of quick ones. Maybe first following up on the FYARRO sort of commercial dynamic. I guess I'm trying to understand this cannibalization sort of phenomenon that you're describing. It sounds like -- and maybe I'm just misunderstanding it. But it sounds like you're saying enrollment into PRECISION1 pulled away commercial PEComa patients. And I'm trying to understand why that's the case, if that's the case. I think, maybe, I'm just totally misunderstanding it. So any help there, I appreciate it. And I have maybe one or two follow-ups.

Yes, sure. So Joe, it's hard for us to tell exactly what patients end up where. What we saw is that the orders coming through -- this is an IV product, and therefore, we don't get physician level data, but we get institutional level data and what we saw was a correlation between reductions in commercial business at some of our largest accounts that often were highly correlated with our PRECISION sites, with some of our largest enrolling PRECISION sites. At a patient level, we don't know exactly how that plays out, but we would anticipate that maybe a few of those patients were spontaneous use like non-PEComa patients, that were being treated commercially and that physicians took the opportunity instead of enrolling those patients in a commercial -- on a commercial basis may have enrolled them into the clinical trial. So it's not PEComa patients into clinical trial because that's obviously an exclusion criteria in this case. And remember that we're talking about swings of 10 patients that create the gap that we saw in Q1 or last 10 patients or less that create the gap that we saw in Q1. And so it takes very few sets of decisions actually to swing the business that way. And so now with Precision fully enrolled, et cetera, the only option for patients that are looking for that last line opportunity in an -- in a non-promoted indication would be to go back to that commercial business.

Okay. Got it. That's helpful. Maybe just two quick clinical questions. I know you guys have said this would be your expectations, but wondering if you could confirm that within PRECISION1, the sort of baseline features for the full population aligns with the first 40 patients, meaning heavily pretreated, diverse set of tumor types. And then for the G12C decision to terminate that, was that based on any data that had emerged out of that trial? Thanks.

Sure. So the -- on the baseline population, we -- from what we can see, it's consistent with what we've seen before. But obviously, we haven't fully evaluated the data to that, and that will only come when we do the interim analysis on the fully cleaned and completed data set. The -- and on the Mirati decision, that decision had nothing to do with efficacy or safety that we saw in that trial. And in fact, we have very little data from that trial so far. And it's more -- it's very much a financial and strategic decision to focus on the endometrial program as well as the NET program, we're really excited about the potential for nab-sirolimus in those indications. Thanks, Joe. Any other questions?

Thank you. One moment for our –

Thanks, Joe. We'll go on to the next question -- next.

Our next question comes from Tara Bancroft with TD Cowen. Please go ahead.

Hi. Good morning. So just want to follow up on the last question that Joe asked. So how much difference in cost savings can we expect now over the next year or two now that you're ending this agreement?

Sure. Scott, do you want to comment on outlook for spending?

Yes. Tara, thanks for the question. Yes, we haven't shared that information, specific information on the individual program. There will be savings, but we haven't shared that information.

Okay. Thanks.

Thanks, Tara. Anything else?

No, I'm good. Thank you very much.

Okay. Operator, we can move to any other questions.

Our next question comes from Ahu Demir with Ladenburg. Please go ahead.

Good morning. Thank you for taking my questions. Two from us. First one, a follow-up to Roger's question. Could you provide more guidance on the EEC program? What are the benchmarks? And what would success look like in this interim analysis for this setting?

Super. Thanks for the question, Ahu. Loretta, would you like to comment on that?

Sure. Good morning.

Good morning, Loretta.

Hi. How are you, Ahu? So the -- so this is a -- it's a Simon's 2-stage design. And the first cohort is 10 patients, and we're pretty far along in accruing those folks. And the second portion will be an additional 19 patients for a total of 29 patients in the study. It's designed to show on the basis of overall response. We're looking for a response rate that exceeds 20%. And our expectation, of course, is that it may be higher, but that would be -- that would give you the kind of guidance I think you're looking for.

That sounds great. Yes, thanks for that, Loretta. My second question is regarding the Mirati collaboration. Based on our scientific understanding, there's a strong rationale between albumin uptake also, therefore, nab-sirolimus uptake in RAS-mutated cancers. So curious, if you will be obtaining the clinical data and do you plan to pursue this setting in the future? Any RAS-mutated cancers and any aspect on that side?

I think, Ahu, we'll see how the data comes in on the patients that were enrolled in the trial and make that decision at a later point in time. Right now, we have no plans to expand into that area.

Got it. Okay. Thanks for taking my questions.

Super. Thank you. Operator, any other questions?

I'm showing no further questions at this time. I'd like to turn it back to Dave for closing remarks.

Great. Thank you. Well, thanks, everyone, for joining the call this morning. Thanks to Scott, Loretta and Audrey for supporting this. And I wanted to remind everyone that we really had great progress over the course of this year, particularly around our clinical study and development programs. We have now fully enrolled our PRECISION1 trial and look forward to our two-thirds interim analysis in quarter three of this year, which will be a major milestone for us and determining where we go next with TSC1 and TSC2 mutant cancers, which are really large opportunity for us to expand the nab-sirolimus portfolio. We're also really excited about the progress we've seen in EEC and NETs enrollment and look forward to early updates on those programs later this year. And then finally, we expect to return to growth for FYARRO in Q2 of 2024 and look forward to sharing updates on that as we progress our commercial business. Otherwise, thank you for joining the call today, and we look forward to further updates as we go through the year. Thanks, everyone. Bye now.

Thank you for your participation in today's conference. This concludes the program. You may now disconnect.

Good day, and thank you for standing by. Welcome to Aadi Bioscience Fourth Quarter 2023 Earnings Conference Call. At this time, more participants are in a listen-only-mode. After the speaker's presentation, there will be question-and-answer session. [Operator Instructions] Please note that today's conference is being recorded. I will now turn the call over to Audrey Gross [ph] Head of Corporate Communications for Aadi Bioscience. Ms. Gross, please go ahead.

Thank you. Good morning, and welcome to the Aadi Bioscience conference call to provide an operational update and review results of the fourth quarter and full year 2023. On the call is Dr. Dave Lennon, our President and CEO; Scott Giacobello, our CFO; and Chief Medical Officer, Dr. Loretta Itri. Today, we will provide an overview of operational activity and financial results for the fourth quarter and full year of 2023. We will open the line for questions at the end of the call following closing comments. A quick reminder that statements made on the call today will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our annual and quarterly filings with the Securities and Exchange Commission, which can be found at www.sec.gov or on our website at www.aadibio.com. In addition, any forward-looking statements made on this call represent our views only as of today, March 13, 2024, and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. With that, I'll turn the call over to Dave for his opening statements. Dave?

Good morning, everyone, and thank you for joining us today to review our financial and operational results for the fourth quarter and full year of 2023. At Aadi, we are focused on unlocking the full potential of mTOR inhibition by uniquely combining nab technology and the potent mTOR inhibitor, sirolimus. We believe nab-sirolimus has potential to deliver deeper inhibition and ultimately better outcomes for patients living with cancers that are dependent on the mTOR pathway. In 2023 was a year marked by progress and increasing momentum for the company as we delivered strong execution against both commercial and development goals. First, FYARRO sales remained solid, achieving a cumulative $24.4 million for the full year of 2023, representing a 60% growth over prior year. FYARRO achieved high penetration in the academic and community settings and is considered the preferred treatment for malignant PEComa. Clinically, a key focus for our organization has been realizing the potential of nab-sirolimus for patients with solid tumors harboring either TSC1 or TSC2 inactivating alterations. These type of genetic alterations are thought to activate the mTOR pathway leading to uncontrolled cell growth and our PRECISION 1 trial is an interventional study designed to elucidate the potential of nab-sirolimus to treat all types of solid tumors with either of these alterations. As a reminder, the unmet need in TSC1 and TAC2 mutated cancers is sizable, whether considering together or independently and represents about 2% of all solid tumor cancer patients. Our latest internal analysis indicates there are approximately 16,000 new patients with these new mutations across a variety of tumor types each year in the U.S. alone. With mutations roughly evenly split between genes, each mutation represents a potential multibillion-dollar addressable market for nab-sirolimus. TSC1 or TSC2-driven cancers are found across a wide range of tumor types, clustering in lung, gastrointestinal, general urinary, breast and gynecological locations and are often very difficult to treat. We believe PRECISION 1 is a cutting-edge trial testing our innovative therapy nab-sirolimus in these cancer types. Although PRECISION 1 is designed as a single trial, each arm is independently evaluated providing us with the ability to assess one arm separately from the other. Given this design, PRECISION 1 can effectively be viewed as two separate studies, each with its own outcome. In Q4, we provided top line results from a planned interim evaluation of the first 40 patients enrolled in PRECISION 1. These data demonstrated sustained tumor reductions in a heavily pretreated population based on investigator-assessed responses in the first 40 patients across both arms. As a reminder, for the TSC 1 arm, 19 efficacy evaluable patients were included in the cutoff date for the interim analysis who had at least one post baseline scan. We reported an overall response rate of 26%, which was within the range of our expectations. Importantly, responses appear to be early, deep and durable. Time to response was 1.4 months and all responses were ongoing at the time of data cutoff. This is especially noteworthy given that this is a heavily pretreated population with a median of three prior lines of therapy. Lastly, these responses were seen across four different tumor types supporting a tumor-agnostic indication. In the TSC 2 arm, we reported a lower response rate, but given these patients were heavily pretreated, including 50% who had had at least five prior lines of therapy, these early TSC 2 results are challenging to interpret. PRECISION 1 continues to enroll steadily, and we now expect the trial to be fully enrolled by May. We are still on track for our next plan interim readout, which is expected in Q3 of 2024. This readout will include a total of 80 patients who have been followed for a minimum of 6 months and will evaluate the primary input in the study, independently assessed overall response rate as opposed to our December analysis, which reported investigator-assessed responses. We expect the study to be completed by the end of 2024 with full data in early 2025. In addition to PRECISION 1, enrollment is underway for both of the previously announced Phase II single indication trials for two promising mTOR driven cancer targets. Overactivation and dysregulation of the mTOR pathway is commonly found in various tumors, and unique delivery and excellent safety profile of nab-sirolimus provides the opportunity to combat these difficult-to-treat cancers. The first trial is evaluating nab-sirolimus in neuroendocrine tumors, or NETs, NETs are with approximately 3,500 patients per year. NETs have historically had a low response rate to treatment with oral rapalogs and other agents, which nonetheless are used clinically and recommended in treatment guidelines today. In preclinical animal models, nab-sirolimus demonstrated improved target suppression relative to other mTORs warranting further exploration of nab-sirolimus in this indication. We're excited about this trial because it provides the opportunity to demonstrate what we believe is nab-sirolimus' best-in-class efficacy in a known mTOR-sensitive tumor type. The second trial we started last year is evaluating the therapeutic potential of nab-sirolimus in advanced and recurrent endometrial type endometrial cancer in combination with the aromatase inhibitor letrozole. Endometrial cancer is the most common cancer of the female reproductive tract and one of the few cancers with increasing mortality. There's an estimated 10,000 cases of EEC diagnosed annually in the U.S. alone. Prior clinical studies of the mTOR inhibitors, combined with letrozole have yielded promising results and recent changes in the recommended standard of care for early-stage disease creates a potential opportunity for our combination to be used in these first and second-line settings. Both of these open-label studies are actively enrolling, and we plan to present initial data later this year. Rounding out our clinical development program, we also have an ongoing trial with combination of Mirati's KRAS inhibitor in lung cancer and other solid tumors. With a solid commercial foundation provided by FYARRO [ph] a robust and bold clinical development program spanning genetically-driven tumors in other mTOR-sensitive tumors and a cash runway into Q4 2025, we are well positioned to realize our ambition of becoming a multi-indication precision oncology company. I will now turn the call over to Scott for updates on our financial progress. Scott?

Thanks, Dave. We had a solid fourth quarter and ended 2023 with $108.8 million in cash, cash equivalents and short-term investments. In early 2024, we implemented measures to streamline our operations and reduce costs, which included headcount reductions in our customer-facing operations and corporate functions. Following these measures, we anticipate that our balance sheet will fund operations into Q4 2025 based on current plans. FYARRO net product sales were $6.3 million for the fourth quarter, representing 6% growth over Q3 2023 and 21% over the prior year quarter. Full year 6.3sales were $24.4 million, an increase of 60% over prior year sales of $15.2 million. Research and development expenses for the quarter increased to $12.8 million compared to $9.4 million in the prior year quarter. For the year, R&D expense amounted to $48.9 million compared to $32.7 million last year. This increase is primarily related to the continued progress of the ongoing PRECISION 1 trial and initiation of the programs in endometrial cancer and NETs. Selling, general and administrative expenses for the fourth quarter were $10.3 million compared to $11.1 million in the same period in 2022. For the year, SG&A expenses totaled $44.5 million compared to $40.2 million in the prior year. This increase is due primarily to higher legal and company infrastructure costs and increased marketing expenses related to FYARRO. Net loss for the fourth quarter was $16.3 million compared to $13.9 million in the fourth quarter of 2022. Net loss for the year was $65.8 million compared to $60.5 million in the prior year. For more information on our financial performance for 2023, a detailed discussion of the results reported on this call will be provided in our 10-K to be filed later today. I'll now hand the call back to Dave for his closing comments. Dave?

Thank you, Scott. I'm so proud of the progress we made in Q4 and what the team accomplished in 2023. FYARRO remains a valuable asset with sustained demand to help meet the needs of patients with PEComa. We're making tremendous progress against our clinical development plans with two sizable markets in TSC1 and TSC2 in activating alterations as well as other mTOR-driven cancers. We're looking forward to sharing the two-thirds interim analysis from PRECISION 1 in the third quarter with full enrollment inspected in May and study completion by the end of 2024. We can now open the line for questions. Operator?

Thank you. [Operator Instructions] And our first question coming from the line of Joe Catanzaro with Piper Sandler. Your line is open.

Yeah, thanks. Appreciate you taking the questions here. Maybe first one, I know the first 40 patients were characterized as being very heavily pretreated. So wondering if you have any visibility or updates around what the remainder of the trials look like? And maybe along these lines, whether you've seen any change in enrollment dynamics in any way since the interim data disclosure? Thanks. And I have one follow-up.

Great. Joe, thank you for the question. I always appreciate talking more about PRECISION 1. Yes. So the first 40 patients were heavily pretreated. We saw three or more lines of prior therapy as those patients enrolled in that first 40 group. We anticipate, right, by the trial design that this is -- we're going to get a number of late-line patients. Patients have to have satisfied the criteria for the indication that they enroll in, in terms of being -- having received all appropriate standard of care prior to their entry and treatment with nab-sirolimus in our trial. And so we anticipate continuing to enroll later line patients within the trial. I wouldn't comment on the overall nature of what we're going to end up with. We're still enrolling patients in the trial, and we'll obviously report out the next or the total 80 patients at the two-thirds interim later this year.

Okay. Thanks. And then my follow-up, maybe unrelated to PRECISION 1. Wondering if there are any early expectations around when you could report initial data from the endometrial or NET studies? I appreciate those are still in the early days. And then any updates on the adagrasib combo trial. Wondering maybe if there's been any changes there with the adagrasib acquisition by Bristol? Thanks.

Yes. So great questions. I think I mentioned earlier that we do anticipate potentially sharing data on endometrial or neuroendocrine trial later this year. Those are open-label single-arm Phase II studies, and we have the opportunity to enroll those. We'll share the data when we think it's appropriate and we have something meaningful to say about how that data is -- those patients are enrolling and that data is maturing. I'm happy to say that both studies are actively enrolling patients, and there's good engagement with the community on generating patients for each of those trials, which we just think is initially a great sign in terms of folks' interest in these therapeutic regimens in each of those indications. And then on the Mirati BMS collaboration that continues and is ongoing. We are enrolling patients into that trial, and we don't have any further updates at this point.

Okay. Thanks. That's helpful. And thanks for taking my questions.

Thanks, Joe.

Thank you. And our next question coming from the line of Liang Cheng with Jefferies. Your line is open.

Sure. Thank you. This - today I'm for Roger. So thank you for taking our questions. I guess from us, we have two questions. One is around FYARRO. So guess more [ph] FYARRO in the coming year. Can you provide us any details, guidance or commercial plans? Second question is about, I know you guys been interacting with FDA about the tumor agnostic. So what's in your understanding, what's the most important thing for FDA to consider label as a tumor agnostic? Thank you.

Great. Thank you, Liang, and thanks for stepping in for Roger. So maybe in terms of FYARRO outlook, maybe I'll turn it over to Scott to talk a little bit about that, and then we'll talk about your second question a little more. But Scott, do you want to just comment on FYARRO outlook for the coming year?

Sure, absolutely. Yes, thanks for the question, Liang. Yes, I think for FYARRO, I mean, as you see, I mean, we're not going to provide guidance for this year. I think what you've seen over the last few quarters, the sales stabilizing around the $6 million mark or slightly above. And I think so the expectation there is we continue to be excited about FYARRO and the potential to grow there. But I think that over the last few quarters, you've seen the sales stabilizing in that $6 million to $6.5 million range, and I think that's what we would expect for 2024.

Thanks, Scott. It is -- Liang, it is a very -- team has done a great job penetrating the market here. We're available and preferred for PEComa in the first-line setting and widely recognized as the preferred therapy for PEComa. It is just an ultra rare population. And ultimately, we may be reaching saturation in that market and expect more incremental growth from here on out. And then your second question was on what are the most important considerations when we think about the FDA's view on the tumor agnostic indication. I'm going to turn it over to Loretta to give her thoughts on how we think or how we interpret the FDA's guidance around the tumor agnostic indication and what's most important there. So Loretta, do you want to comment?

Sure. I'd be happy to. I think from what we have seen recently, perhaps the most important thing that the agency wants to see in tumor agnostic studies is a variety of different tumor types. What they do not want in a tumor agnostic study is to see concentrations of information in certain subtypes of patients. They are looking for a representation of the mutation across a variety of different tumor types. That is why you do a tumor agnostic study. So I think that, that is perhaps the single most important element in terms of their determination regarding whether or not a drug classifies for tumor agnostic approval. And then, of course, I think they are looking for a reasonable response rate and, of course, a good safety profile. In our case, since we already have approval in a single indication, I think they would be looking to see that the safety profile in the agnostic population closely resembles what we have already seen in PEComa.

Thanks, Loretta. And just to add on to what Loretta was saying, what we saw so far, we have enrolled a very diverse tumor population within our trial, and I think you saw that even in the early results where we had a kind of broad distribution of tumor types that we shared back in December. Thanks, Liang, for the questions. And I think if there's no follow-ups, we can move to the next.

Thank you. Thank you. Appreciate it.

Thank you.

Thank you. [Operator Instructions] And our next question coming from the line of Ahu Demir with Ladenburg. Your line is open.

Good morning. Thank you so much for taking my questions. I have two questions, a follow-up to Joe's question regarding endometrial cancer. One, could you give us a sense of the sites open, how many sites are open and inclusion and exclusion criteria for the patients? And what are we expecting to see this year? How many patients are they heavily pretreated? If you can provide a little bit of color, that would be great.

Sure. I think -- so Ahu, we're happy to answer those questions. I'm going to turn it over to Loretta for some of the details. But at the same time, we probably wouldn't discuss a number of sites or number of patients at this point just given where we are in the trial, and it is active, and we're kind of continuing to build that story. But maybe just in the design of the trial and what we might expect to see later this year, I'll let Loretta give you an update there. So, Loretta?

Good morning, Ahu. Always great questions, as usual, coming from you. So basically, this is an open-label Phase II study, looking to evaluate the combination of nab-sirolimus with letrozole in patients who have advanced and that would be advanced or unresectable Stage 3 or 4 or recurrent endometrioid endometrial carcinoma. Patients will have received either no or one prior line of chemotherapy. So this is a population of patients who are relatively early in their treatment course, which is somewhat differentiated, of course, from what we're doing in PRECISION. So patients are treated with the same dose of nab-sirolimus as they were in PEComa that is a well-established and safe dose. And I think pretty much that this is a Simon 2-stage study, so we plan to enroll the first cohort, and we anticipate since this is an open label study being able to report out early results by the end of this year. Does that address your question, Ahu, would you like more detail?

This is great. Thank you so much Loretta. This is very helpful. And thank you for your compliment as well. I have one more conceptual question for you, Loretta, if I may. So you mentioned mTOR sensitive tumors besides TSC1, 2, could you comment on what other mutational backgrounds are sensitive to mTOR inhibitors?

Well, I think that's quite a difficult question because I think there are many mutations along the mTOR pathway that may provide -- that may provide targets. However, I don't think that any of those specifically has been identified as a specific mutational target for mTOR inhibition. There are suggestions that I don't think is any of those are proven.

Very helpful. Thank you so much.

You're most welcome.

Thanks, Ahu. Operator, are there any other questions?

And I see no further questions in the queue at this time. I'll now turn the call back over to Dr. Dave Lennon for any closing remarks.

Thank you, operator. And thank you, everyone, for joining the call today. I think as you see, we are delivering on the operational goals we have set for both 2023 and looking ahead into 2024, we're very confident on our ability to deliver against our number one priority, which is the PRECISION 1 trial. And we look forward to providing an update on that two-thirds interim later this year and finishing that trial within 2024. We're also excited about the new programs we mentioned today and got to discuss a little bit in the Q&A and look forward to providing updates on both our NET and endometrial trials later this year. At the same time, we remain really confident in the continued progress we're making in the PEComa market with FYARRO. This is an ultra-orphan indication, and we're highly penetrated within that market. And that continues to deliver solid sales for us as we go forward. Overall, otherwise, I thank you all for your time and attention today, and we look forward to the next update with you all. Thank you, and have a great day.

Ladies and gentlemen, that does conclude our conference for today. Thank you for your participation. You may now disconnect.

Good day, and thank you for standing by. Welcome to the Aadi Bioscience Third Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there’ll be a question-and-answer session. [Operator Instructions] Please be advised, today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Marcy Graham, Senior Vice President of Investor Relations and Corporate Communications, Aadi Bioscience. Ms. Graham, please go ahead.

Thank you. Good morning and welcome to the Aadi Bioscience conference call to provide an operational update and review results for the third quarter 2023. Joining me on the call today: Dr. David Lennon, our President and CEO; Scott Giacobello, our CFO; and our Chief Medical Officer, Dr. Loretta Itri. Today we will provide an overview of operational activity and financial results for the third quarter of 2023 and an update on our PRECISION 1 trial and clinical development plans going forward. We will open the line for questions at the end of the call, following closing comments. A quick reminder that statements made on the call today will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our annual and quarterly filings with the Securities and Exchange Commission, which can be found at www.sec.gov or on our website at www.aadibio.com. In addition, any forward-looking statements made on this call represent our views only as of today, November 8th, 2023, and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. With that, I will turn the call over to our CFO, Scott Giacobello for his opening statements. Scott?

Thank you, Marcy and good morning, everyone. Thank you for joining us today to review our financial and operational results for the third quarter of 2023. Before we discuss our progress in the third quarter, an activity is currently underway, I would like to take this opportunity to introduce Dave Lennon, who joined us as President and CEO at the start of the fourth quarter. Dave comes to us with more than 20 years of pharmaceutical leadership and deep expertise in mTOR-driven diseases, with a History in Oncology and Rare Disease, and a strong background in US and Global Commercialization. All experiences that make him the perfect choice to guide Aadi through our next phase of growth and development. I’m excited about the future and look forward to working with Dave, continuing in my role as CFO. Now, I’d like to turn the call over to Dave for his initial comments. Dave?

Thank you, Scott. I appreciate the warm welcome introduction. I would also like to thank you for taking the role of Interim CEO, prior to my joining, and thank the entire management team for all their hard work in getting us to where we are today. The unique combination of technology, timing and team is what drew me to Aadi. There’s a great opportunity here to build on the success of the mTOR inhibitor class in cancer. Our groundbreaking therapy, nab-Sirolimus allows us to generate deeper inhibition of the mTOR pathway at the site of tumor and hopefully more potent anticancer activity resulting in better patient responses. We’ve proven this in our first indication of PEComa, a rare soft tissue sarcoma, and our very unique moment as a company where we expect to have multiple data readouts over the next 12 to 18 months from our highly anticipated tumor-agnostic study, PRECISION 1. I’m also fortunate to be joining Aadi with an excellent team, who continue to execute on an ambitious commercial and clinical programs focused on building a leading precision oncology company. And I’m very happy to share their strong performance over the third quarter. Importantly, PRECISION 1 continues to enroll rapidly, and we now expect to present early interim data by mid-December. We will share more of our trial progress and upcoming catalysts in a moment. FYARRO sales remained solid at $6 million in the third quarter, a 40% growth over the prior year, and $80 million in cumulative sales in the first nine months of 2023. We are also executing on our previously announced development strategy with the initiation of two Phase 2 studies of nab-Sirolimus. One in combination with standard of care in endometrial cancer, and the other as a single agent in neuroendocrine tumors. These are in addition to our ongoing trial in combination with Mirati’s KRAS inhibitor in lung cancer and other solid tumors. A key focus of our organization has been realizing the potential of nab-Sirolimus for patients with solid tumors, harboring either TSC1 or TSC2 inactivating alterations. These type of genetic alterations are sought to activate the mTOR pathway leading to uncontrolled cell growth. And our PRECISION 1 trial is an interventional study designed to elucidate the potential of nab-Sirolimus to treat all types of tumors with either of these alterations. The unmet need in TSC1 and TSC2 mutated cancer is a sizable, whether considered together or independently. We presented data at this fall ENSA Symposium or Triple Meeting based on next-generation sequencing of mutations of nearly 440,000 cancer patients from the Foundation Medicine database. This large real-world evidence provides the best look at data to-date on TSC1 or TSC2 mutation frequencies across all common tumor types. This corroborates our previous estimate that patients with TSC1 or TSC2 represent about 2% of all cancer patients. Our latest internal analysis indicates that approximately 16,000 patients with these mutations across a variety of tumor types. With mutations roughly evenly split between genes, each mutation represents potential multibillion dollar total addressable market for nab-Sirolimus. TSC1 or 2-driven cancers are found across a wide range of tumor types, clustering in lung, gastrointestinal, genitourinary, breast and gynecological locations, and are often difficult to treat. We believe PRECISION 1 is a cutting-edge trial testing our innovative therapy, nab-Sirolimus in these cancer types. With that background, I’d like to turn it over to Loretta, who will speak further to the details of this unique tumor-agnostic trial and our plans going forward. Loretta?

Thank you, Dave and good morning, everyone. As Dave noted, PRECISION 1 is a unique study and one without cohorts segregated by specific tumor types, making it truly tumor-agnostic. This is an ambitious and adaptive trial intended to elucidate the impact of nab-Sirolimus on cancers expressed in inactivating mutations of TSC1 and TSC2, regardless of tumor types. We are very pleased with the continuing advancement of the trial. The number of open sites has increased as has access to patients with more than 150 sites available to us using our just-in-time mechanism that allows us to open prequalified sites within as little as a two-week period. Working with our NGS partners, and benefiting from the broad outreach that boarded by our clinical sites, both academic and community based, we’re able to effectively identify and track patients with TSC1 or TSC2 inactivating alterations who have an interest in participating in our study. Accrual between the two arms has been remarkably even, as predicted by the real-world data recently published at the ENA Annual Meeting, we continue to have a very broad representation of solid tumors, with more than 25 discrete tumor types enrolled in the trial to-date. It is important to remember, that although PRECISION 1 is designed as a single trial, each arm is independently evaluated, providing us with the ability to assess one arm separately from the other. Given this design, PRECISION 1 can effectively be viewed as two separate studies, each with its own outcomes. Additionally, these are not just two studies. They are two standalone, tumor-agnostic studies. Consistent with the adaptive statistical analysis plan, there are two preplanned interim analyses in the near future, one at one-third enrollment, which we plan to report in mid-December of this year, and another at two-thirds enrollment, which we expect to report in the third quarter of 2024. The interim analysis that will be performed when two-thirds of patients are accrued and have been followed for six months. We’ll evaluate the primary endpoint of the study, DMC evaluated ORR, and will provide us with the opportunity to modify the study or to file early if the data warrant. The upcoming protocol interim analysis planned for later this year, will include early data on tumor type distribution, safety and investigator assessment of response using RECIST criteria on approximately 20 evaluable patients from each arm. We expect these results to reflect a broad representation of tumor types vary treatment histories and lines of therapy. We have built great momentum and in PRECISION 1 program and look forward to delivering on key milestones, both later this year and throughout 2024. We expect to have completed enrollment by the spring of next year, well ahead of our planned delivery of the two-thirds interim readout in the third quarter, and to complete the study by the end of 2024. We remain very excited about the potential of this important study and the promise of nab-Sirolimus and look forward to communicating the preliminary results from the PRECISION 1 trial in a few weeks. I’ll now turn the call over to Scott for updates on our financial progress. Scott?

Thanks, Loretta. On the financial front, we remain well capitalized, ending the third quarter with $119.3 million in cash, cash equivalents and short-term investments, which is expected to fund operations into 2025 based on current plans. FYARRO sales were $6 million in the quarter, representing 40% growth over the same period in 2022. Research and development expenses for the quarter increased to $11.9 million, as compared to $8.8 million in the prior year quarter. This increase is primarily related to the continued progress of the ongoing PRECISION 1 trial and the build out of the R&D organization. Selling, general and administrative expenses for the third quarter were $11.2 million, compared to $9.9 million for the same period in 2022. This increase is due primarily to the build out of company infrastructure and increased marketing expenses related to FYARRO. Net loss for the third quarter was $16.3 million, compared to $14.4 million in the prior year quarter. For more information on our financial performance for the third quarter, a detailed discussion of the results reported on this call will be provided on our Form 10-Q. I’ll now turn the call over to Dave for his closing comments. Dave?

Thanks, Scott. As I said earlier, we are truly excited about what lies ahead. We have defined two sizable markets in cancers with TSC1 or TSC2 inactivating alterations, and look forward to sharing the upcoming PRECISION 1 interim analysis planned for mid-December. Beyond that, we are excited about the new catalysts coming up in 2024, including our two-thirds interim analysis in the third quarter. We expect to reach full enrollment in the trial in the spring of next year, fully completing this study by the end of 2024. We can now open the line for questions. Operator?

Thank you. [Operator Instructions] Our first question comes from Boris Peaker with Cowen. Your line is open.

Great. Thanks for taking my question. Two questions for me. First, on that second interim analysis which you estimate in 3Q of next year, what efficacy do you need to stop early? And second, in the PEComa market for FYARRO, do you have any sense of kind of what the duration of therapy is turning out to be [technical difficulty]?

Boris, thanks very much for the questions. In terms of the second interim, I wouldn’t comment at this point about what efficacy needs to be. Obviously, we have two arms running within this study and the context of response rate and duration in that combination needs to be considered when we think about potential for stopping a study early. But, of course, we do have that option at that point in time. On the PEComa side in terms of duration, I think what we can see is that duration is consistent with what we’ve been seeing in the clinical trial, and that’s what I would comment at this point.

Great. Thanks for taking my questions.

Thanks, Boris.

[Operator Instructions] Our next question comes from Joe Catanzaro with Piper Sandler. Your line is open.

Hey, everybody. Appreciate you taking my question. Maybe a couple for me on PRECISION 1. So for the initial interim expected by year-end, with the minimum follow-up of four and a half months, can you just let us know what minimum amount of post-baseline scans that’s insured? And then, for the second interim analysis, I think this is the first we’re hearing of this. So, was this always the plan? And if not, what drove the decision to take another look? And then sort of along these lines, Loretta, if I heard you right, the second interim analysis will allow you to modify the study. Just wanted to understand that a little bit better given it sounds like the study will be fully enrolled by that time, what modifications maybe you could potentially employ then? Thanks.

Sure. So, Loretta, do you want to comment on those first three areas?

Hi, Joe. Thanks for your questions. So, let me reply. So the – I’m sorry, I kind of have the order of your questions a little bit confused. Do you think you could repeat the first one, please?

Yeah, yeah. Sure, I’ll be quick here. So, the minimum amount of post-baseline scans that’s insured with four and a half months of follow-up. And then the second interim analysis, was this always in the plans? Or is this something new? And what drove the decision? And then, what modifications you could potentially take post the second interim analysis, given that the trial would have been fully enrolled by that point?

Okay, great. So, the four and a half month guarantees at least two post-baseline scans. So everyone will have at least the ability to have that kind of follow-up. The interim analysis, the second interim analysis at two-thirds that you were asking a question about, has always been in the statistical analysis plan. It is an adaptive design. This is very common when approximately two-thirds of patients are on study to have a look and to assess whether or not the sample size is sufficient to file early or whether or not you might want to consider resizing. So those are both options that we would have when that interim occurs. But this analysis was always planned. And we will have six months of follow-up. This analysis will look at the independent review of radiologic scans and will be performed by an independent data monitoring committee. So, even though we will have completed enrollment in the study, presumably by that time, we will still be requiring additional follow-up on the entire cohort. I hope that addresses your questions.

Yeah, it does. Super helpful. Thanks for taking my questions.

Thanks, Joe.

You’re so welcome.

[Operator Instructions] Our next question comes from Roger Song with Jefferies. Your line is open.

Great. Thanks for the update and taking our questions. A couple from us. In terms of the interim analysis now we have two. Maybe can you let us know, I understand you are not going to be providing the guidance right now. But at which interim analysis, if at all, you will contextualize the efficacy against the FDA statistical hurdle or the standard of care you have been providing to the FDA as the benchmark? So we can know in each interim analysis, the efficacy or the ORR will be reaching the goal you want to achieve?

Thanks for the question, Roger. I’ll take this one. It’s important to note that this interim that we’re presenting in December is based on one-third of patients enrolled and minimum of four and a half months of follow-up. It’s also investigator-assessed ORR, so this is not the primary endpoint of the study, which is independently assessed overall response rate. And the second interim is actually based on the primary endpoint, and it will be at that point, we would be testing against the statistics of the plan.

Got it. So, in the second – the interim analysis, you will do the primary endpoint analysis will be that at the point you will let us know what’s the hurdle for that? Or you would just let us know, okay, we are not stopping the trial and we’ll continue for the full data?

Yeah. We view the hurdle to be something that is a review issue, and we probably wouldn’t talk about that at that point in time, but rather give a sense of what the efficacy measures we’re seeing are and whether – where we are with the trial in terms of continuation.

Got it. Thank you. Maybe just a quick follow-up.

Yeah.

Yeah, a quick follow-up on this is that, you say you will complete the trial by the end of 2024. And when should we expect the full data from the trial? Thank you.

Yeah. It’s roughly at the end of 2024 or early 2025. We anticipate it’s probably more like the early 2025 at this point, but we’ll give a further update once we complete enrollment.

Excellent. Thank you. That’s it from us.

[Operator Instructions] Our next question comes from Ahu Demir with Ladenburg. Your line is open.

Good morning, team. Thank you so much for taking my questions. Two questions from us. First one is regarding the Triple Meeting Presentation. It looks like p53 is the most frequently observed comorbidity. Curious how that might impact deep comorbidity, how they might impact the trial activity? And during the interim analysis, will you disclose the other mutations in the patients? Or is it going to be more high level?

Yeah. So, I’ll take a first crack and Loretta back me up on this. TP53 is the most common co-mutation that you see in that analysis for patients across 440,000 cancers that we looked at. And our internal calculations when we look at those distributions indicate there’s potentially 16,000 new cancer patients each year with either TSC1 or TSC2 mutations. About 50% of those, if I recall, the data correctly, had co-mutations in p53 and although that while high overall is very consistent with what you see across all tumor types and all types of cancers. TP53 is the most common co-mutation in general for different types of tumors. And so, it’s not different from what you might expect overall. And given that we’ve seen responses to patients with TSC1 and TSC2 altered cancers in the past in the retrospective analysis that became the basis for PRECISION 1 and PRECISION 2. We wouldn’t expect it to necessarily negatively impact the trial in any way, and we believe it would work within that context. And Loretta, I don’t know if you would add anything to that?

No, I think that’s entirely correct. I would have answered it the same way.

Yeah. And then in the interim, we won’t be presenting co-mutation status at this point in time. The numbers, while significant in terms of an initial indicative nature of how the trial is going, we don’t believe would be sufficient to really do a detailed analysis of co-mutation status that would be robust enough to make any determinations on at this point. So, we won’t be sharing that data.

That’s helpful. And my second question is on the endometrial program. Now the trial is enrolling, how many sites are open? And when do you expect to see initial data from Stage 1 portion of the study?

So we’ve just started that study. I wouldn’t comment on the number of sites we have, but the community is very excited about engaging in this study and we hope to have an update on the study sometime in 2024.

Great. Thank you for taking my questions.

Thanks, Ahu.

And I’m not showing any further questions at this time. I’d like to turn the call back over to Dave for any closing remarks.

Super. Thank you very much, Kevin and thank you, everyone for joining us on today’s call. As we mentioned, we’re really excited about the progress we’re making on the PRECISION 1 trial with the interim analysis plan for mid-December and a number of exciting catalysts for 2024 that could propel our need to grow. We appreciate your time and look forward to the opportunities in the future to provide additional updates on our process – or progress, I should say. Thank you for joining the call and have a great day, everyone.

Ladies and gentlemen, this does conclude today’s presentation. You may now disconnect and have a wonderful day.