Earnings Transcript for GTHX - Q3 Fiscal Year 2022

Operator: Hello and thank you for standing by. Welcome to the G1 Therapeutics Third Quarter 2022 Financial Results Conference 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]. I would now like to hand the conference over to your opening speaker, Vice President of Communications, Will Roberts. Will, please proceed.

Will Roberts: Thank you, Sheena. Good morning, everyone, and welcome to the G1 conference call to discuss our third quarter 2022 financial results and business update. The press release on these financial results was issued this morning and can be found in the News section of our corporate website g1therapeutics.com. On this morning's call, the team will provide a business overview of the third quarter of 2022, including an update on our clinical programs and our commercial progress in that period with COSELA, which is approved and commercially available to decrease the incidence of chemotherapy-induced myelosuppression in adult patients when administered prior to a platinum etoposide continue regimen or a topotecan containing regimen for extensive stage small cell lung cancer or ES-SCL. A Q&A session as Sheena said will follow the prepared remarks. Before I begin, I'd like to remind you that today's webcast contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements represent management's judgment as of today and may involve certain risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by these statements. For more information on such risks and uncertainties, please refer to our filings with the Securities and Exchange Commission, which are available from the SEC or on our corporate website. Any forward-looking statements represent our views as of today, November 2, 2022. Joining me on the call today are Jack Bailey, our Chief Executive Officer; Raj Malik, our Chief Medical Officer; Andrew Perry, our Chief Commercial Officer; and Jen Moses, our Chief Financial Officer. I'll now turn the call over to Jack. Jack?

Jack Bailey: Good morning, everyone. Thank you for joining us on the call today. During the third quarter, we demonstrated continued execution on our clinical program, but also experienced lower COSELA sales momentum versus what we achieved in the second quarter. I'll cover both in my opening comments and then Raj and Andrew will each provide additional color to both topics. First, I'm proud of the progress the clinical team achieved. As Raj will discuss among the clinical milestones that we've reached during the quarter, and since our R&D Day in September, we announced this morning that we are seeing encouraging initial safety results from our Phase 2 ADC trial with sacituzumab govitecan that shows its potential to provide clinically meaningful reductions of over 50% in adverse events related to sacituzumab such as myelosuppression, diarrhea, and potentially even alopecia compared to previously published single agent safety profile of this ADC. We also completed enrollment in our Phase 3 metastatic triple negative breast cancer trial and for our Phase 2 bladder cancer trial and as we discussed in our last call the trilaciclib Mechanism of Action trial. Next, our Phase 2 MOA trial results have been accepted for presentation at the San Antonio Breast Cancer Symposium meeting. Two abstracts providing additional non-clinical data on trilaciclib's potential anti-tumor effect have been accepted for presentation at the Society for Immunotherapy of Cancer meeting in November. Finally, and perhaps of most importance our timelines for initial results remain intact for our pivotal Phase 3 trials in colorectal cancer and in triple negative breast cancer. At the same time, we are cognizant of the fact that we did not deliver the level of sales results that we were expecting. As you'll hear from Andrew, we are working through some market variability due to new patient flow, pressure on organizational staffing, and account additions at different times of the year. Though, this was balanced by a 12% increase in reorders from existing accounts. We are putting in place a variety of actions that Andrew will describe that will drive growth over the coming months. We hear every day from healthcare professionals and patients who have experienced the unique benefit that only COSELA provides. It's a paradigm changing drug that enables oncologists for the first time to proactively reduce or prevent the serious multi-lineage hematologic side effects of chemotherapy rather than treating them reactively. We remain as confident in the potential of COSELA today as ever. And as the initial results from our ADC trial underscore extensive stage small cell lung cancer is just the start. We are convinced of its potential value in much bigger markets like colorectal cancer. Since this morning, marks the first of many new clinical data disclosures over the coming months, I will first ask Raj to provide an overview of our clinical momentum during the quarter, and since our R&D Day, starting with an overview of the initial ADC safety results. Andrew will then cover our recent commercial actions and results, including an update on the efforts of our field sales team during the third quarter of 2022. Finally, Jen will provide the financial results for the quarter and I'll be back for some concluding comments. With that, I'll turn the call over to Raj.

Raj Malik: Thanks, Jack, and good morning, everyone. In September, we held our 2022 R&D Day and discussed a variety of topics including the timing to initial results and what to expect from those results and new preclinical data supporting the potential of trilaciclib to work synergistically with other anti-cancer therapies. We've made good progress on all fronts since then. I will start with the encouraging initial trilaciclib for sacituzumab govitecan Phase 2 safety results in patients with triple negative breast cancer that we announced this morning. We are seeing consistent reductions by well over 50% in the rates of numerous adverse events associated with sacituzumab when trilaciclib is administered prior to the ADC relative to the previously published single agent safety profile of sacituzumab govitecan. We had hoped to present these data at a medical conference this fall, but small numbers at the time of abstract submission this summer precluded that. However, recent enrollment momentum provided the opportunity to evaluate key safety data in the first 18 of the 21 patients' enrolled to-date. Though early and unaudited the trends in treatment emergent adverse events have been consistent over the time we have been monitoring the safety results of the study. Specifically, some examples of these reductions are in the rate of Grade 3 and 4 neutropenia, which dropped from 52% in the sacituzumab data to 17% with trilaciclib and sacituzumab. The rate of any grade anemia, which dropped from 40% to 6% and the rate of any grade diarrhea, which dropped from 65% to 28% with no occurrences of Grade 3 diarrhea with trilaciclib and sacituzumab and 11% in the sacituzumab data. We view these as on-target effects of trilaciclib, not only in the expected reduction in the rate of myelosuppression related to sacituzumab, but also in the rates of diarrhea and potentially alopecia. This is likely due to the presence of CDK4/6 expressing cells in the intestinal crypt and in hair follicles. Though the data will continue to mature, we are very encouraged by these early on-target results as are the investigators who have reviewed the data because they begin to clarify the potential for trilaciclib in combination with ADC such as sacituzumab govitecan across other indications. In addition, these data could read through to the FOLFOXIRI regimen in our colorectal study, which also includes irinotecan. We look forward to presenting a more comprehensive safety and efficacy data at the medical meeting in the second quarter of 2023. Next, I'll comment on our pivotal Phase 3 trials. First in PRESERVE 1, our 326 patient trial of trilaciclib in first line metastatic colorectal cancer, the primary endpoints are assessments of the effect of trilaciclib on myelosuppression compared with placebo as measured by the occurrence of severe or Grade 4 neutropenia during induction and duration of severe neutropenia in cycles one through four. We expect to release results in the first quarter of 2023 on myeloprotection and other on-target effects of trilaciclib like diarrhea, which can be dose limiting in colorectal cancer patients receiving FOLFOXIRI. This is a pivotal trial. If the myeloprotection data read out positive, we will meet with regulatory authorities to discuss filing for approval in this indication. Next, we recently completed enrollment in PRESERVE 2, our first line triple negative breast cancer pivotal trial in 187 patients with PD-L1 positive and negative tumors receiving first line trilaciclib or placebo prior to gemcitabine and carboplatin. We expect the interim overall survival analysis to be conducted by our data monitoring committee in the second half of next year. If the trial meets the interim analysis stopping rule, it will terminate and we will report the top-line results. If it does not, the trial will continue to the final analysis. Next, let's shift to progress on other ongoing Phase 2 trials. As we said during R&D Day, based on the mechanism of action of trilaciclib, we expect to see the greatest effects on longer-term efficacy endpoints like overall survival and progression-free survival, and the least effect on response rate. We recently completed enrollment in PRESERVE 3. Our Phase 2 trial of trilaciclib in combination with chemotherapy and the immune checkpoint inhibitor avelumab in 92 patients with bladder cancer. Initial safety and tumor response data are expected in the fourth quarter of this year, followed by data on the primary endpoint of progression-free survival in 2023. As we have said, we do not expect to see myeloprotection in this trial likely as a result of the gemcitabine containing backbone. Next, our abstract on the initial results of the Phase 2 mechanism of action trial was accepted for poster presentation at the upcoming San Antonio Breast Cancer Symposium in December. The San Antonio poster will describe the initial immune endpoint results. Additional data, including pathological complete response and other immune and profiling data are expected in 2023. In September, we discuss new preclinical data describing the potential for trilaciclib to enhance the cancer immunity cycle by enhancing T-cell activation favorably altering the tumor microenvironment and improving long-term immune surveillance. As Jack mentioned, two abstracts on this work have been accepted for presentation at the SITC 2022 Annual Meeting. In summary, we have made good recent progress and we believe it positions us well for a data rich period. Finally, I also will mention that we recently presented new data at the Precision Oncology Summit that continue to demonstrate the real world impact that COSELA can have on severe hematologic adverse events and supportive care needs. In real world practice, COSELA is used in a heterogeneous population of extensive stage small cell lung cancer patients. Despite this heterogeneity, COSELA consistently shows the potential to reduce the occurrence of myelosuppression, supportive care utilization, and chemotherapy dose reductions and delay. With that, I'll turn the call over to Andrew for a commercial overview. Andrew?

Andrew Perry: Thank you, Raj. I'm glad to be with you today to provide an update on a number of commercial topics, including third quarter sales performance, factors effecting growth and a description of some of the actions we're putting in place that will drive growth going forward. The third quarter was our second complete period during which COSELA was promoted solely by our own team of G1 oncology sales account managers following the termination of our co-promotion agreement with Boehringer Ingelheim in early March. Our goal this quarter was to build on the platform of volume and growth, which we demonstrate in Q2. We delivered similar volumes in Q3 as generated in Q2, and I'll discuss some of the factors affecting growth today. Beginning with sales activity, we ended the quarter with $8.3 million in net sales of COSELA representing approximately flat vial volumes compared with Q2. Volume growth compared with same quarter last year was 129% demonstrating the overall progress we have made with sales execution. As you might recall, we showed quarterly growth of approximately 60% in Q2 of this year compared with Q1, but when reporting those results, we remarked that the small cell lung cancer market can be variable from month-to-month due to patient flow and pressure on staffing at healthcare organizations at different times of the year. We've reviewed the most recent available patient level claims, and we estimate that the number of new extensive state small cell lung cancer patients declined around 10% in the first two months of Q3 compared with Q2. As a reminder, in the extensive stage small cell lung cancer market, our quarterly growth is highly reliant in gaining new patients either from new accounts or from existing accounts in order to compensate for patients who complete their chemotherapy regimen and drop off therapy. Similar to same quarter last year, we added fewer new accounts in Q3 than in Q2. However, we had increased the volume of vials of reordered from existing accounts by around 12%. We also added seven new top 100 organizations since the end of Q2, giving us a total of 64 of the top 100, which have ordered COSELA launched to-date. As a result, our overall estimate of COSELA patient share in Q3 actually increased to nearly 8% in the first line market, which represents the majority of our use. We saw 71% of volume in the quarter come through community clinics and hospitals, and 29% of volume from academic centers representing an uptick in demand in academic centers this quarter. 98% of our volume in the quarter was in commercial supply with 2% provided through our patient assistance program. So our Q3 performance was driven by diminished numbers of new extensive stage small cell patients in the market, and fewer new accounts added, which together resulted in fewer new COSELA patients. However, this was balanced by more depth of reorders and existing accounts. Our paramedic remained stable with the majority covered by Medicare and third-party reimbursement has remained strong. COSELA brand awareness among oncologists remains high as dose intention to prescribe, face-to-face calls continue to compose the majority of sales engagements in Q3, and our measures of sales force effectiveness continue to exceed oncology industry norms. Looking forward, into Q4, with several new top 100 organizations having only recently come on Board, we are moving quickly to ensure initial trial becomes advocacy and then adoption. In reviewing opportunities for further improving execution in Q4; we introduced territory level sales incentive goals for the first time so that all of our sales account managers are highly incentivized to deliver growth in the quarter. We introduced new marketing claims including patient reported outcomes, which many oncologists believe are a pivotal reason for considering COSELA. We entered into negotiations for volume-based agreements with several large community oncology provider networks with one already finalized. We anticipate beginning to see the impact of these in Q4. We also recently expanded our speaker bureau and completed our first live speaker training since launching COSELA. Finally, we made some operational changes including territory realignment resulting in one fewer territory making 33 in total. Overall, this was a quarter where we sustained the high-levels of execution demonstrated in the prior quarter despite some challenges and flow of new patients. Going forward, although we anticipate some variability in month-to-month patient flow, we now have 64 of the top 100 organizations and well over 500 accounts in total with COSELA experience. Our customers strongly believe in the benefits of COSELA for their patients and many are ready to share those experiences with their peers. This places us in a strong position to ensure that when new extensive stage patients are diagnosed, they have the opportunity to receive COSELA. Together with our new more patient-focused marketing resources, territory level sales incentives, and select volume-based provider network contracts, we believe we're well-positioned for stronger growth moving forward. With that, I'll turn the call over to Jen for a financial update. Jen?

Jen Moses: Thanks, Andrew, and good morning, everyone. As Will mentioned, full financial results for the third quarter of 2022 are available in this morning's press release and will be in the 10-Q, which we intend to file after market close. Our total revenue for the third quarter of 2022 was $23.6 million comprised of net COSELA revenue of $8.3 million and license revenue of $15.3 million. For the same period in 2021, total revenue was $4.9 million and included $3.4 million of net product revenue for COSELA and $1.3 million of license revenue. The license revenue from the current quarter is primarily related to revenue recognized from two development milestones related to the sincere license agreement including a $13 million milestone payment related to the approval of COSELA in China. Cost of goods sold for the three months ended September 30, 2022, was $1.1 million compared to $0.6 million for the same period in 2021. Our research and development expenses for the third quarter of 2022 were $19.6 million compared to $21.1 million for the third quarter of 2021. The decrease in R&D expenses was primarily due to a decrease in cost for manufacturing active pharmaceutical ingredients and drug product to support clinical trials. Our selling, general and administrative expenses for the third quarter of 2022 were $24.4 million compared to $24.3 million for the third quarter of 2021. Comparing the two periods, we saw increases in personnel costs due to increased headcounts and administrative costs offset by decrease in medical affairs costs, commercialization spend, and professional and technology costs. Regarding our cash position as described in the press release this morning, we ended the third quarter with cash, cash equivalents and marketable securities of $123 million compared to $221.2 million as of December 31, 2021. We have amended our agreement with Hercules to provide additional flexibility with our covenants and have extended the timeline we are able to draw the $25 million available to us into June of 2023. With that, I'll turn the call back over to Jack for some closing comments. Jack?

Jack Bailey: Thank you, Jen, Andrew, Raj, and Will. And as always, I want to thank people living with cancer for your inspiration, you drive the G1 team toward our goals every day. Before we move to Q&A, I just want to recap some of the points that you have heard today. We are very encouraged by the initial safety results from our Phase 2 ADC trial sacituzumab, that show its potential to provide clinically meaningful reductions of well over 50% in numerous adverse events related to sacituzumab such as myelosuppression, diarrhea, and even potentially alopecia. We expect to provide initial results from our two ongoing pivotal trials in CRC and TNBC next year, starting with CRC data in the first quarter of 2023, and from two additional Phase 2 trials later this year. The MOA data will be presented at San Antonio and the bladder cancer data will be issued via press release. We experienced lower COSELA sales momentum versus what we achieved in the second quarter, largely due to variability in patient flow and why we saw fewer new accounts coming on Board during the quarter, this was offset by double-digit growth and existing accounts reordering. We've already initiated actions including territory level sales incentives, the addition of patient reported outcomes in our marketing materials, and volume-based agreements with several large provider networks. We are confident that this will drive stronger COSELA growth over the coming months. Given the lower COSELA sales momentum, I do want to comment on our expectation for the remainder of 2022. As I said, we feel confident in the actions that we have put in place to drive COSELA growth rate and we intend to provide formal guidance as soon as we have an update on performance and impact. We anticipate that we will drive growth in the fourth quarter of 2023 over the third quarter, as these initiatives rollout, and we expect that they will be effective as we head into and through 2023. Thank you for your time this morning. We will speak again in this format on the fourth quarter and full-year 2022 call. And as you've heard today, we'll have a variety of opportunities to communicate with you regarding initial data from our Phase 2 and Phase 3 trial at medical meetings starting later this quarter and continuing throughout 2023. With that, I'll close the call and turn it over to Q&A. Operator would you please remind our listeners how to ask the question.

Operator: Thank you. Yes. At this time, we will conduct the question-and-answer session. [Operator Instructions]. Okay. So our first question comes from the line of Gil from Needham & Company. Gil, your line is open.

Gil Blum: Hi, good morning, everyone, and thanks for taking our questions. So maybe a first one for Andrew. I've never thought of small cell lung cancer as a seasonal disease. I mean usually pretty aggressive and patients go on therapy immediately. Can you explain kind of maybe the dynamics here?

Andrew Perry: Yes. Thanks, Gil. No, I mean I agree with you. I think once diagnosed, obviously patients can progress very quickly. I think though there is a bit of a process in picking up those diagnoses, and we do hear from healthcare providers that the presentation of the symptoms that lead to a diagnosis are more likely at different times of the year. We did find, as I said in the patient claims data that we look past for Q3 that are available so far that that is born true in those data, that there was a decline of around 10% in new patients receiving any kind of therapy for extensive stage in Q3. And then, of course, it's just harder to get hold of healthcare staff during that period to promote product as well. So it's really a combination of those external factors that led to fewer new patients going on COSELA in Q3.

Gil Blum: Okay. Then that's helpful. And a couple questions for Raj. First one, can you may be put in context the significance of reducing AEs with the specific ADC that was tested and found? Do you think the talks will lead to -- does talks usually lead to reduced amount of treatment?

Raj Malik: Hey, Gil. Yes, so that's certainly what we're looking for in this study, right? So that myeloprotection and better tolerability will allow greater exposure, which should then allow greater efficacy of Trodelvy. There was actually a paper presented at ASCO, which showed a good relationship between exposure of Trodelvy to response. So that is exactly the rationale behind conducting the study. So we're encouraged by what we're seeing from a safety perspective so far.

Gil Blum: Okay. And maybe a last one. So the activity of COSELA in the gut which you've mentioned briefly, is there additional evidence, I mean diarrhea and gut-related talks is a very common dose limiting toxicity across chemo?

Raj Malik: Yes, that that's something that we've been following actually. We've done some work ourselves. There was a paper published which showed that using a 4/6 inhibitor can actually reduce radiation induced gut toxicity. And the hypothesis is that the stem-like cells in the intestinal crypt are dependent upon CDK4/6 for replication. So the similar protective mechanism that we see in the bone marrow could apply in the gut as well. I think SN38, as you know, is obviously causes a lot of diarrhea. And so we're encouraged by the early signs there. And as you also know, we pointed out in my remarks that irinotecan, which is of course the parent drug that gives rise to SN38 and it's part of the FOLFOXIRI regimen is also causes diarrhea in that regimen. So we'll be very interested to evaluate what happens to diarrhea in the colorectal trial also.

Gil Blum: All right. Thank you for taking our questions and good luck on the rest of the year.

Jack Bailey: Thanks, Gil. Operator?

Operator: Oh. Please standby for the next question. Our next question comes from Dane from RJF. Dane, your line is open.

Dane Leone: Hey, thanks for taking the questions. On the initial results that that you're sharing today for the combination of trilaciclib ahead of Trodelvy, could you provide some more context for those 18 patients in terms of response rate in that cohort? How that compares to I guess the SN study and or the number of cycles those patients had actually received of the agency-based therapy and how that compares to maybe the median four cycles of therapy that they were getting or median, sorry, six to seven cycles that they were getting in the SN study. I think what we're looking for is just some way of comparing in understanding whether the AE table that you have presented today is within the context of drug exposure that those patients would've gotten in the comparable study. Thank you.

Raj Malik: Yes. Hey, Dane, Raj here. Yes, so in terms of responses, we've seen responses in the study, first of all. As I mentioned, the enrollment in the early part of the study was actually pretty slow. The first patient was enrolled in January, so we do have some long-term data to evaluate safety. However, the bulk of the patients actually have come on in the last say three plus months. So it's really still early to make a true assessment of what the response rate could be. But clearly, as you know, toxicities like neutropenia and diarrhea do happen early on, and if enough patients that received enough cycles for us to make that assessment. And that was the reason why we thought it was important to put out these data. But ultimately the goal as you know, and as Gil also asked is to extend the duration of therapy on Trodelvy to allow us to not only potentially improve responses, although as we've mentioned before, we don't really anticipate seeing an improvement in responses based on the mechanism of action. It's really more on extending those longer-term events such as PFS.

Dane Leone: Sorry, to just follow-up on that. What was the -- for the 18 patients that you included in the preliminary safety dataset, what were the criteria and you used for including them in that valuable cohort in terms of exposure to sacituzumab govitecan? Thank you.

Raj Malik: Yes. Patients have to have completed at least one cycle on therapy. And yes, it received certainly the combination of trial up plus sacituzumab.

Dane Leone: Do you have a break -- yes? Do you have a breakdown of how many patients were -- are included in that AE table that had more than one cycle of yes, sacituzumab?

Raj Malik: Yes, actually the vast majority have had more than one.

Dane Leone: Okay. And you can't disclose what the ORR is for that cohort. I don't think people are really looking for you to be better. They just want to make sure that for this AE table, it's comparable which then validates the AE -- the AE cross comparison that you're trying to make.

Raj Malik: Yes, Dane. Yes, as I said, we've -- from a -- I think there is a difference between exposure from a safety assessment and exposure from an efficacy assessment even though with Trodelvy some of the responses happen early like in the first cycle. There are significant number that happen with additional cycles. So I think it's really hard to make a call right now from an efficacy standpoint, a response rate standpoint, I think the data would really not be mature. So all I can comment is we have seen responses. So we're encouraged from that perspective. And of course, we are interested in seeing that as well before we put out these data. So, sorry, I can't directly answer that question.

Dane Leone: Yes. So let me ask you this way, which might be helpful to keep on the line. It sounds like to be comparable in terms of drug exposure of the ADC to SN, these patients, the 18 patients that you have here still need more cycles of sacituzumab govitecan. So plausibly, the AE table you're showing could go up in some of these rates. Do you have an idea of for the comparison ultimately of the cohort, what you think is clinically meaningfully different for some of the key event rates either on neutropenia, thrombocytopenia, whatever you want to pick that would be the target product profile that you're hoping for with this study?

Raj Malik: Yes. So as I mentioned, we've been following the safety data, right -- really right from the beginning, right? That's what you do in any trial. And so the rates for both the neutropenia and the diarrhea have remained relatively actually consistent with what we put out there with additional patients that have been enrolled. You're absolutely right. The numbers will definitely change with increased just with more patients in general and definitely with exposure potentially as well. But it has been consistent from -- kind of from the beginning. In terms of what are the most meaningful AEs where we would hope to show an improvement, it's really neutropenia and its consequences including febrile neutropenia. Of course, I think, I think diarrhea is -- are really intriguing early finding, I would say. And if you look at the sacituzumab label, those are the two warnings on the label. So that's something else that we're following closely. Of course, we're encouraged with the effect on anemia as well, which speaks to sort of the multi-lineage early indicators of effect here.

Dane Leone: Last question for me, just when do you expect to complete enrollment? Did you -- did I understand that correctly, that you have 21 enrolled now, so you'd still need 24 to hit the enrollment target in the study?

Raj Malik: Yes. We're talking approximately 40 but potentially even -- yes, and we're hoping in the -- by the end of the year that we'll have the required number of patients, but -- and we'll present as I said, the safety and the efficacy data set in the second quarter of next year. That's our target.

Operator: Thank you, Dane. Please stand by while we bring the next question. Okay. Our next question comes from Ed from H.C. Wainwright. Ed, your line is now open.

Ed White: Good morning. Thanks for taking my questions. So you had mentioned in the third quarter the diagnoses were down, and it could be due to some seasonality. It -- what is the historical trend for the fourth quarter as far as diagnosis goes? Do you have any of that information for small cell lung cancer?

Andrew Perry: Yes, thanks, Ed. And I would say that the way we track it is through patient claims. So it's really patients going on to therapy for the first time rather than technically diagnoses. So it's patients going on to etoposide platinum with or without atezolizumab that we track. And yes, looking at seasonality and it can be vary month-to-month. We -- for example, August was our best month launch to-date within the quarter, within a relatively flat quarter. So it can certainly be vary month-to-month. Looking back at Q4 of last year, we then show growth in quarterly growth in Q4 of last year, think of around 20%. But clearly, there are periods particularly towards the end of Q4 where there might be some seasonality. But overall, Q4 last year contained also some of our highest months at that point. So we believe with our improved capability in the marketplace that we have this year, and with some of the new tactics that I've discussed, we're looking forward to a good Q4.

Ed White: Okay. Thanks Andrew. And a couple of questions for Jen. R&D expenses were down the last two quarters sequentially. SG&A expenses were also down sequentially the last -- each of the last two quarters. I just wanted to know if we can get any of your thoughts on the fourth quarter.

Jen Moses: Yes, sure. Hi, Ed. Yes, I would say I think we're going to be in line, I would expect R&D actually to be a little bit higher next quarter, just because we're coming up on data readouts and there are some as we do the stats and everything like that that tends to add costs. But as these studies wind down, not wind down but complete, we're just having sites and patients that we're not having to pay for anymore. So those costs will continue to come down. For SG&A, I would expect it to stay pretty in line with what we have, not anticipating any major changes there.

Ed White: Thanks, Jen. And can you give us any guidance on cash runway?

Jen Moses: Sure. So I think before we had given guidance into 2024, I think in light of the fact that guidance was based on a couple of things, the utilization of the $25 million from Hercules, which we haven't pulled down yet, and also a continued sales ramp up quarter-over-quarter, as Andrew just alluded to, we are seeing more variability in the sales line. So not giving guidance to 2024 at this time although we do have scenarios that get us there.

Ed White: Okay. Thanks, Jen. That's all the questions I have. Thank you.

Jack Bailey: Thanks, Ed.

Operator: Thank you, Ed. Please standby for the next question. Our next question comes from Anupam from JPM. Your line is open.

Malcolm Kuno: Hi, this is Malcolm Kuno on for Anupam Rama. Thanks for taking the question. What are some of the key marketing hurdles or pushback that you're hearing in terms of getting new prescribers on Board with COSELA?

Andrew Perry: Yes, thanks. The barriers remain the same that we've been dealing with over the last year or so, which is first of all, understanding the extent of the problem of myelosuppression, because those reduction has become a way of life. And of course, that can immensely effectiveness of the chemotherapy treatment. We actually now have real world evidence that's been presented at conferences and which is in our promotion, which shows with thousands of patients in the real world, the true extent of myelosuppression and it really is an incredible burden on patients with real consequences in terms of hospitalizations, et cetera. So we feel we're in a good position from a marketing perspective to tell that story. The next part is, with many of these organizations, they do have complex processes to get a new product into consistent use. And so moving from trial to adoption usually involves going through a high risk patient that maybe the first patient that they trial with, seeing that benefit in that patient and then wanting to use it with all eligible patients. To do that, you have to go through a formulary process, an EMR edition, Order Set edition, and it can take some time to work through that. And certainly in Q3, it was tougher to move from trial to adoption just because getting all of those staff members together, having all of those conversations means appointments, means taking time, and with staff aren't available to do that because of seasonal vacations or whatever. It could just slow the process down. And then finally, we have to make sure that we are persistent in our efforts because not many providers see a lot of extensive stage small cell patients. So we have to get out there. We have to expand our peer-to-peer efforts. We have to expand our digital efforts. And we've actually made incredible strides forward over the last few months with that not only our digital efforts, but as I mentioned before, expanding our speaker bureau, having that first live-to-live -- live speaker training. It was fantastic. See the energy in the room from our speakers who have experience with COSELA as they really advocated with their peers for it, and we're looking forward to sharing their real world stories too.

Malcolm Kuno: Great. Thanks for that background.

Operator: Thank you. Please standby for our next question. And the next question comes from David from Wedbush PacGrow. Your line is now open.

David Nierengarten: Hey, thanks for taking the questions. Two quick ones. First, could you remind us what was other -- any other support agents the Neulasta or whatever allowed for patients in the triple negative study? And then, as a quick follow-up, in the SN study Neulasta I think was allowed after the first cycle of Trodelvy. Is -- do you know if there are continued problems with neutropenia, if you were to prophylax with G-CSF for what the rates might be of severe neutropenia in patients who might have a pre-treatment with it? Thanks.

Raj Malik: Hey, David, this is Raj. Yes, so we allowed supportive care including growth factors and transfusions and so on. And I -- and you're right that it was also allowed in the SN trial. I'm trying to recall what proportion received G-CSF, I seem to recall around. Yes, I think in that kind of range. So yes, so that's something clearly we are following as well in our study, but given the lower rate of neutropenia, we would expect that to be a lower proportion in the combination with trial.

David Nierengarten: Okay. And did any patients receive it so far in your study G-CSF?

Raj Malik: You know, I'm not aware of that. Yes.

Operator: Thank you. Please standby for our next question. And our next question comes from Troy, Cowen and Company. Your line is open.

Troy Langford: Hi everyone. Congrats on all progress, and thanks again for taking our questions. So I just have two questions on CRC, maybe one for Raj and then one for Andrew. So first on CRC data next quarter, can you just remind us of your expectations for the data and maybe like what level of neutropenia reduction would make you all feel excited? And then for Andrew on opportunity in CRC, do you all have any idea how the top COSELA accounts compare to those in CRC? Do you all see a lot of overlap there? And if so, do you think you could possibly penetrate the market much faster given the established relationships that you already have at some of these centers?

Raj Malik: Hey, Troy, this is Raj. So I'll go first. Yes, so this is a Phase 3 trial and we have obviously defined the staffs in a way to see the reduction, right? So just to give you a context for colorectal with FOLFOXIRI based on the THRIVE data, we expect a Grade 4 neutropenia rate in about the 20-odd-percent rate. So and the trial is designed to show a statistically significant reduction over that. And if we meet that, I think that's going to be clinically meaningful. So I hope that that helps answer your question and I think that would be exciting because as you know, the major hurdle for continuing FOLFOXIRI is really myelotoxicity. So if we're able to improve upon that, we believe that's going to be a benefit for patients.

Andrew Perry: Yes, Troy, I'll chip in on the second one. Yes, so I do think there will be significant overlap, and that will be particularly in the community staffing where community oncologists really, really see all comers. They'll have a specialist within the network or within the office, but very often they'll see multiple tumor types. I think in the academic center that centers up be a little different. And we will have to engage with them both through our medical affairs organization as well as commercially to be able to get to those folks. But I do think a lot of CRC is treated in the community. So I do think there will be overlap there. Also in terms of the speed of uptake, probably the single biggest thing on the wish list of our COSELA champions out there today is when are you going to get more tumor types? I want to be able to use this with more of my patients. And so I do think that we will see some early adoption in people who just become more familiar with COSELA by having multiple tumor types in the indication. So our customers are telling us they're incredibly excited about our future potential, and we can't wait to deliver that volume too.

Troy Langford: All right. Awesome. Thanks so much for all the color. That helps a lot.

Jack Bailey: Operator, are you muted?

Operator: Our last -- thank you. My apologies. Our last question comes from Tony from ROTH Capital. Tony, your line is open.

Tony Butler: Thanks very much. Good morning. Raj, first of all, I've got just three brief questions, Raj -- the -- if we go back to the triple negative breast cancer data with Trodelvy, treatment interruptions, if you just do the straight math from the label of SN are in 63% of patients and the -- and which lead to treatment interruptions in roughly half or 47%. If you actually run the numbers on the 18 patients, five patients would've request -- at least would have that dose interruption. Is there -- is that why you're making the statements about a reduction in 50%? I'm trying to frame this correctly. That’s question one if I may. Question two is, Andrew, I believe in Q2 you made reference to sales reps having some level of increase in face-to-face contact. If I've characterized it correctly, is that the same in Q3? Has it increased? Are we in the fifth inning that you would have expected to occur? Or is it too early to say? And then, finally, do you get data? Is it only after the fact on surgeries per center or do you get it as granular as the type of surgery per center when you look at your data on a quarter-to-quarter basis? Thanks very much.

Raj Malik: Hey, Tony, this is Raj. So yes, I mean, I think that certainly dose delays, dose reductions is something we're following very closely. Obviously ongoing study, but we're encouraged by what we've seen to-date, I think is all the color I can provide at the moment.

Andrew Perry: And I'll chip in Tony on the -- yes, so face-to-face is over 70% of our engagements are face-to-face. It has gone off markedly since we introduced our new sales team, which is fantastic. Really interesting, as I mentioned it before, but although we saw access to customers a little bit limited in Q3 because of those seasonal variations, our share voice actually remains stable during Q3. So that basically means that all companies have limited access to customers during that period, which again lends itself to the fact that there's some seasonality there. But overall, we've been very, very pleased with the ability of our folks to -- to get customers and have substantive face-to-face discussions. In terms of the last question, I'm not sure if I was quite tracking with you, and maybe Raj can answer, but we don't track any kind of surgical procedure data in our commercial setting, anything.

Tony Butler: So but you alluded to the fact that small cell lung cancers were down 10% in Q3. Is that the way? Am I correct?

Andrew Perry: Yes.

Tony Butler: Did I correctly hear that? So you had to actually track something that had information about surgery whether or not it's diagnoses or otherwise I assume all these patients would have surgery.

Andrew Perry: No. Great, great point. Thanks for the clarification. Actually so it's based on claims data for etoposide platinum with or without atezolizumab.

Tony Butler: Okay.

Andrew Perry: And with or without the presence of a diagnosis of extensive stage in the vast majority of use for that regimen is obviously extensive stage. So that's how we judge that. So it's basically a paid claim for that regimen. We'll tell us how many new to line patients are existing in the marketplace, but it's not related to the surgical procedures that would accompany that.

Operator: Thank you, Tony. I would now like to turn it back over to our CEO -- to the CEO, Jack Bailey for closing remarks.

Jack Bailey: Thank you, Operator. As always, we look forward to keeping you all updated as we progress. Certainly, thank you for joining us today. Please stay well and we'll be in touch.

Operator: Thank you so much. This now concludes the call. We will now disconnect the line.