Jefferies 2014 Global Healthcare Conference. June 5, PDF Free Download

Jefferies 2014 Global Healthcare Conference June 5, 2014

ArQule, Inc. Safe Harbor This presentation and other statements by ArQule may contain forwardlooking statements within the meaning of the Private Securities Litigation Reform Act with respect to clinical trials with the Company s product candidates, including tivantinib (ARQ 197), ARQ 092, ARQ 087 and ARQ 761, the AKIP drug discovery platform, competitive products, financial operations and results, corporate partnerships and other future business objectives, opportunities and strategies. Forward-looking statements are typically identified by words such as believe, expect, anticipate, intend, outlook, position and similar expressions, or future or conditional verbs such as will, should, would, and could. Forward-looking statements are subject to numerous assumptions, risks and uncertainties. Forward-looking statements speak only as of today, and ArQule assumes no obligation to update them. Actual results may differ materially from forward-looking statements or historical performance due to the factors discussed in this presentation and factors previously disclosed in ArQule s SEC reports. See discussion of Risk Factors in the Company s Annual Report on Form 10-K as filed with the SEC. Prospective investors are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date of this presentation. ArQule s product candidates are in various stages of development and are not available for sale or use outside of approved clinical trials. ArQule and the ArQule logo are registered trademarks of ArQule, Inc. 2

ArQule Company Overview Partnered lead program: Tivantinib first-in-class c-met inhibitor Pivotal Ph 3 clinical development in second line hepatocellular carcinoma (METIV HCC trial) ongoing in western territories; additional Ph 3 clinical trial in second line HCC ongoing in Asia National Institutes of Health / Cancer Therapy Evaluation Program includes ongoing Ph 2 randomized trials in prostate, head & neck and kidney cancer Proprietary clinical pipeline: ARQ 092 AKT inhibitor and ARQ 087 FGFR inhibitor Each program nearing max tolerated dose/end of Ph 1, with Ph 1b planned Internally discovered/developed and fully owned Potential for proprietary combination Financial position: sustainable well into 2016 Strong end of 2013 cash balance funds proprietary pipeline development Significant partner contributions to tivantinib Ph 3 development costs Reduced cost base while maintaining all capabilities 3

ArQule Financial Profile Cash balance Cash and marketable securities at Mar 31, 2013 $ 86 Mil Net use of cash guidance 2014 $ 35-38 Mil Cash and marketable securities 2014 end guidance $ 57-60 Mil Stock data Shares outstanding $ 62.6 Mil Fully diluted shares outstanding $ 71.3 Mil Key recent sources of funding Share offerings (Jan 2011 and Apr 2012) $ 103 Mil Partnership milestones Q4 07-Q1 14 $ 173 Mil 4

ArQule Clinical Stage Programs Product Partnered Tivantinib Target Indications Preclinical Phase 1 Phase 2 Phase 3 Approved C-Met HCC Ph 3 METIV-HCC Trial Tivantinib C-Met HCC Ph 3 Asian Trial Tivantinib C-Met Multiple indications Randomized and Open Label Ph 2s and Ph 1s Proprietary ARQ 092 AKT Solid tumors Lymphoma Ph 1a ARQ 087 FGFR Solid Tumors Ph 1a ARQ 761 NQ01 Solid Tumors Ph 1a 5

TIVANTINIB: Oral, Small Molecule Inhibitor of the c-met Receptor Tyrosine Kinase 6

Tivantinib Ph 3 Funding is Cash Neutral Key terms of tivantinib partnerships Daiichi Sankyo (DS) co-development worldwide, except Asia $60 Mil upfront, $560 Mil potential milestones, tiered double-digit royalties; to date, $40 Mil in milestones have been received DS has all ex-asia commercial rights, ArQule has US cocommercialization rights Kyowa Hakko Kirin (KHK) in Asia $30 Mil upfront, $93+ Mil potential milestones, mid teens/low 20s royalties; to date, $18 Mil in milestones have been received KHK has exclusive development and commercial rights in its region Financial implications DS and ARQL fund 50/50 development costs ex-asia; ARQL to fund its 50% of Ph 3 costs exclusively with milestones and royalties KHK to fund 100% development/commercialization costs in Asia 7

Tivantinib in HCC Second-Line, MET Diagnostic-High Ph3 Pivotal Single Agent Trial (METIV-HCC* in the West) HCC Inoperable locally adv/metastatic disease Prior sorafenib treatment MET diagnostic-high (assessed by IHC) Companion diagnostic R A N D O M I Z E 2 : 1 Tivantinib 120 mg tablet BID** ~200 pts Placebo ~100 pts Stratification Factors Vascular invasion Extra-hepatic spread AFP (< or > 200 ng/ml) Endpoints 1 o : OS 2 : PFS, safety 3 : ORR, DCR, TTP, PD, PK, biomarkers * Sponsors: ArQule and Daiichi Sankyo **Dose reduced from 240 mg tablet twice daily (BID) to 120 mg tablet BID following observation of higher incidence of neutropenia. DMC safety analysis of reduced dose cleared the trial to proceed. PK analysis of DMC-determined cohort demonstrated that 120 mg tablet BID has comparable exposure to 240 mg capsule as per the Ph 2 trial data. 8

Tivantinib in HCC Second-Line, MET Diagnostic-High Ph 3 Pivotal Single Agent Trial (JET-HCC* in Japan) HCC Inoperable locally adv/metastatic disease Prior sorafenib treatment MET diagnostic-high (assessed by IHC) Companion diagnostic R A N D O M I Z E 2 : 1 Tivantinib 120 mg tablet BID ~105 pts Placebo ~55 pts Stratification Factors Vascular invasion ECOG status Endpoints 1 o : PFS 2 : OS, TTP, response safety * Japan Evaluation of Tivantinib in HepatoCellular Carcinoma, sponsored by Kyowa Hakko Kirin Co., Ltd. 9

Statistical Assumptions for METIV-HCC Trial Primary endpoint OS > 257 events required Median OS 7.7 months in treatment arm 5.0 months in placebo arm Hazard ratio = 0.65 Interim analysis ~ 154 OS events (60 percent of OS events) Efficacy stop, no futility stop, minimal alpha spend 10

Ongoing Ph 3 METIV HCC Trial is Based on Successful Ph 2 Randomized, Placebo-Controlled, Double-Blind Trial Study met primary endpoint in second-line HCC (ITT population), with statistically significant 56% improvement in time-to-progression (HR = 0.64, log rank p-value = 0.04) OS in MET-High Patients and Prognostic Implication of MET Major improvements seen in MET+ patients OS (7.2 mos. vs. 3.8 mos., HR=0.38, log rank p-value=0.01) TTP (2.9 mos. vs. 1.5 mos., HR=0.43, log rank p-value=0.03) PFS (2.4 mos. vs. 1.5 mos., 0.45, log rank p-value=0.02) AEs reported at similar rates in both arms except for higher incidence of fatigue and hematologic events, which declined with dose reduction Tivantinib in MET-high hepatocellular carcinoma patients and the ongoing Phase III clinical trial, published in Hepatic Oncology, posted online Jan. 29. 2014 http://www.futuremedicine.com/doi/full/10.2217/hep.14.3#_i14 11

MET, HCC and Tivantinib: Recent Literature Among all these pathways, c-met is currently the most promising target, thanks to a proven prognostic role and a putative predictive value for patient selection. 1 Tivantinib (ARQ 197) is, at present, the most widely investigated c-met tyrosine kinase inhibitor in HCC. 1 High MET expression evaluated by immunohistochemistry seems to select patients with higher chances of benefit. 1 The development of tivantinib, a small molecule inhibitor of the MET receptor can serve as a paradigm. 2 A randomized phase II study was performed with correlative biomarker work showing that high Met-expression may identify a group of patients that benefit most from the drug. 2 1 Dissecting signaling pathways in hepatocellular carcinoma: new perspectives in medical therapy; Future Oncol. (2014) 10(2), 285 304 2 Survival after sorafenib: Expect the unexpected; Journal of Hepatology 2014 vol. 60, 243-244 12

Tivantinib NIH Sponsored Ph 2 Randomized Trials Prostate (NCT01519414*) Tivantinib vs placebo, double-blind, randomized Primary outcome progression free survival; est. enrollment 78 Head and Neck (NCT01696955*) Tivantinib + cetuximab vs. cetuximab + placebo, randomized, open label Primary outcome response rate; est. enrollment 76 Kidney (NCT01688973*) Tivantinib + erlotinib vs tivantinib, randomized, open label Primary outcome response rate; est. enrollment: 26 *NCT Identifier Numbers on www.clinicaltrial.gov 13

PROPRIETARY PIPELINE ARQ 092 ARQ 087 14

ARQ 092 Inhibitor of AKT/PI3K Pathway 15

PI3K/AKT Pathway: An Extensive Signaling Network Implicated in Human Disease AKT signal transduction is a critical node serving a variety of cellular functions including survival, proliferation and protein synthesis AKT signal pathway is aberrantly dysregulated in a wide range of tumor types Extensive molecular evidence validates the pathway as a target in cancer Meric-Bernstam and Gonzalez-Angulo, J Clin Oncol 2009 Vivanco I et al., Nat Rev Cancer, 2:489-501, 2002 16

ARQ 092: An Orally Available, Potent Pan-AKT Inhibitor ARQ 092 is an orally bioavailable, non-atp competitive allosteric AKT inhibitor Demonstrated inhibition of tumor cell lines with PI3K/AKT pathway alterations. Inhibition of tumor growth and downstream signaling in vivo in tumors with dysregulated PI3K/AKT pathway Analog Biochemical IC 50 (nm) AKT1 AKT2 AKT3 Pathway Inhibition in AN3CA Cells IC 50 (µm) @ 2hrs p-akt (S473) p-akt (T308) p- PRAS40 ARQ 092 2.7 14.4 8.1 0.06 0.04 0.31 p-akt (T308) p-akt (S473) β-actin ARQ 092 inhibits downstream AKT pathway (µm) 0 0.012 ARQ 092 0.037 0.11 0.33 1.0 17

ARQ 092: Building a Profile Safety profile slightly different from other AKT inhibitors in the clinic Hyperglycemia precedes rash Exploring multiple dosing schedules to maximize pathway inhibition Early evidence of clinical activity with partial response, long term stable disease Once optimal schedule declared, plan to expand in Phase 1b Baseline 4 months Patient with small lymphocytic lymphoma and PI3K mutation 18

ARQ 087 Multi-kinase Inhibitor with Pan-FGFR Activity 19

FGF/FGFR Pathway: Part of a Crucial Signaling Network, Disruption of which has been Associated with Many Human Diseases Fibroblast growth factors and their receptors tightly regulate key cell behaviors, such as proliferation, differentiation, migration, and survival Disruption or dysregulation of the FGF/FGFR signaling pathway has been associated with many developmental disorders, and oncology indications They also have been shown to be fundamental to embryonic development, regulation of angiogenesis, and wound healing in adults Source: Brooks et al., (2012) Clinical Cancer Research 18 20

ARQ 087: A Potent and Orally Bioavailable FGFR Inhibitor Inhibition of Activated FGFR Family Members by ARQ 087 IC 50 (nm) FGFR1 FGFR2 FGFR3 FGFR3 (K650E) FGFR3 (K650M) FGFR4 4.5 1.8 4.5 9.2 11 34.3 ARQ 087 Shows Strong Anti-proliferative Activity in Cell Lines with Amplified/Mutated FGFR Cell information RNA expression Gene Copy Number GI 50 (µm) Cell Tissue Origin FGFR mutation FGFR1 FGFR2 FGFR3 FGFR1 FGFR2 FGFR3 MTS NCI-H716 Cecum 0.01 35.63 0 2 14 2 0.1 SNU-16 Gastric 0 27.76 0.1 3 14 2 0.1 Kato III Gastric 0 68.36 0.8 4 14 3 0.2 MFM-223 Breast 1.27 28.84 0.2 7 14 3 0.5 MFE-280 Endometrium FGFR2: S252W 2.62 0.28 0.5 3 10 2 0.9 MFE-296 Endometrium FGFR2: N549K 0.22 0.32 0.2 ND ND ND 1.0 AN3CA Endometrium FGFR2: K310R; N549K 4.59 1.95 0.4 2 3 2 1.7 KMS-11 Blood FGFR3:Y373C 0.02 0.34 11.3 ND ND ND 1.0 KG-1 Blood FGFROP2-FGFR1 fusion 0.05 0.02 0 3 2 2 0.8 FGFR2 amplified FGFR2 mutated FGFR3 mutated FGFR2 translocation 21

ARQ 087: Building a Profile Currently in the dose escalation portion of a Ph I study Safety profile slightly different from other FGFR kinase inhibitors in the clinic No renal toxicities observed so far Biological effect seen with continuous dosing Early evidence of clinical activity with long term stable disease Once optimal schedule declared, plan to expand in Ph 1b 22

Jefferies 2014 Global Healthcare Conference. June 5, 2014