Verastem, Inc. (Nasdaq:VSTM) (also known as Verastem Oncology), a biopharmaceutical company committed to developing and commercializing new medicines for patients battling cancer, announced a new strategic direction to accelerate the advancement of certain of its clinical development programmes.
The Company’s primary focus will be on the development of CH5126766 (VS-6766), its RAF/MEK inhibitor, in combination with defactinib, its focal adhesion kinase (FAK) inhibitor, for the treatment of KRAS mutant solid tumors. Verastem Oncology will also continue to advance the development of duvelisib (COPIKTRA) for the treatment of relapsed or refractory peripheral T-cell lymphoma (PTCL).
“With our newly expanded development pipeline and strengthened balance sheet, we believe this new strategic direction will be transformative for Verastem Oncology as we will have the opportunity to rapidly advance the development of the clinical programs that we believe will yield the greatest results for patients, physicians and shareholders,” said Brian Stuglik, Chief Executive Officer of Verastem Oncology. “We are honored to have leading life science investors participate in our recently announced private placement. Verastem Oncology’s mission is centered on improving the lives of cancer patients and we believe our work in collaboration with the scientific community has presented significant opportunity to make further meaningful strides in areas of critical need.”
Accelerating Development of CH5126766 (VS-6766) and Defactinib Combination
In early 2020, Verastem Oncology licensed exclusive global development and commercialization rights to CH5126766 (VS-6766), a unique and promising inhibitor of the RAF/MEK signaling pathway. The combination of CH5126766 (VS-6766) and defactinib is currently being investigated in a Phase 1 clinical study and expansion cohorts in patients with KRAS mutant advanced solid tumors, including low grade serous ovarian cancer (LGSOC), non-small cell lung cancer (NSCLC) and colorectal cancer (CRC). Data from this Phase 1 study have been submitted for presentation at the upcoming American Association for Cancer Research (AACR) 2020 Annual Meeting. Verastem Oncology plans to initiate discussions with regulatory authorities during the first half of 2020, with the goal of commencing a registration-directed trial as soon as possible.
Advancing Duvelisib in Relapsed/Refractory PTCL
At the American Society of Hematology (ASH) 2019 Annual Meeting, Verastem Oncology presented positive data from the dose optimization portion of the Phase 2 PRIMO study evaluating duvelisib in patients with relapsed or refractory PTCL, an aggressive disease with a lack of effective therapeutic options. This initial phase of the trial demonstrated promising clinical activity including complete and durable responses, as assessed by independent central review, with a manageable safety profile. The expansion phase of this registration-directed study continues to accrue patients and Verastem Oncology expects to complete enrollment in 2020 and report top-line results from the expansion cohorts in early 2021. Verastem Oncology intends to build on the existing Fast Track and Orphan Drug Designations and submit a regulatory package to the U.S. Food and Drug Administration to expand the approved indications for COPIKTRA to include relapsed or refractory PTCL.
Focusing COPIKTRA Commercial Activities
Verastem Oncology generated preliminary unaudited COPIKTRA net product revenue of $3.6 million for the fourth quarter of 2019, compared to $4.0 million for the third quarter of 2019, and $12.3 million for the full year 2019. Net sales were impacted by timing of purchases and gross to net adjustments associated with Medicare Part D (“donut hole”). Demand units increased 20% from third quarter to fourth quarter 2019. Going forward, Verastem Oncology will be reducing the resources directed to the promotion and sale of COPIKTRA in its current indications, including reducing the size of its salesforce and non-core clinical research. Verastem Oncology plans to shift its COPIKTRA promotional resources toward large, community-based practices and academic institutions, which represent the majority of the appropriate third-line patients with chronic lymphocytic leukemia/small lymphocytic lymphoma (CLL/SLL) and follicular lymphoma (FL).
Financial Benefits of the Strategic Realignment and 2020 Financial Outlook
As a result of this strategic realignment, Verastem Oncology expects to reduce its operating expenses by approximately 40% for 2020 compared to 2019. Based on its current operating plans, Verastem Oncology expects its research and development and selling, general and administrative expenses for the full year 2020 to be in the range of $70 million to $85 million. As of December 31, 2019, Verastem Oncology had preliminary unaudited cash and short-term investments of $111.3 million. As announced today, Verastem Oncology anticipates completing a private placement of approximately 46.5 million shares of its common stock at an offering price of $2.15 per share on March 3, 2020, resulting in gross proceeds of approximately $100 million to Verastem Oncology before deducting expenses to the placement agents and other estimated offering expenses. Verastem Oncology expects that its existing cash and cash equivalents, along with the revenue it expects to generate from COPIKTRA, will be sufficient to fund its planned operations into the fourth quarter of 2021.
