Corvus Pharmaceuticals, Inc. (NASDAQ:CRVS) Q2 2025 Earnings Call Transcript

Corvus Pharmaceuticals, Inc. (NASDAQ:CRVS) Q2 2025 Earnings Call Transcript August 8, 2025

Operator: Good afternoon, everyone. Thank you for standing by, and welcome to the Corvus Pharmaceuticals Second Quarter 2025 Business Update and Financial Results Conference Call. [Operator Instructions] It is now my pleasure to turn the call over to Zack Kubow of Real Chemistry. Please go ahead, sir.

Zack Kubow: Thank you, operator, and good afternoon, everyone. Thanks for joining us for the Corvus Pharmaceuticals Second Quarter 2025 Business Update and Financial Results Conference Call. On the call to discuss the results and business updates are Richard Miller, Chief Executive Officer; Leiv Lea, Chief Financial Officer; Jeffrey Arcara, Chief Business Officer; and Ben Jones, Senior Vice President of Regulatory and Pharmaceutical Sciences. The executive team will open the call with some prepared remarks, followed by a question-and-answer period. I would like to remind everyone that comments made by management today and answers to questions will include forward-looking statements. Forward-looking statements are based on estimates and assumptions as of today and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by those statements, including the risks and uncertainties described in Corvus’ quarterly report on Form 10-Q for the quarter ended June 30, 2025, and other filings the company makes with the SEC from time to time.

The company undertakes no obligation to publicly update or revise any forward-looking statements, except as required by law. With that, I’d like to turn the call over to Leiv Lea. Leiv?

Leiv Lea: Thank you, Zack. I will begin with a brief overview of our second quarter 2025 financials and then turn the call over to Richard for a business update. Research and development expenses in the second quarter of 2025 totaled $7.9 million compared to $4.1 million for the same period in 2024. The $3.8 million increase was primarily due to higher clinical trial and manufacturing costs associated with the development of soquelitinib as well as an increase in personnel-related costs. The net loss for the second quarter of 2025 was $8 million, including a noncash loss of $400,000 related to Angel Pharmaceuticals, our partner in China. In addition, we recorded a noncash gain of $2 million from the change in the fair value of Corvus’ warrant liability during the second quarter of 2025.

This compares to a net loss of $4.3 million for the same period in 2024, which included a $1.8 million noncash gain related to the change in fair value of Corvus’ warrant liability and a $600,000 noncash loss related to Angel Pharmaceuticals. Total stock compensation expense for the second quarter 2025 was $1.3 million compared to $800,000 in the same period in 2024. As of June 30, 2025, Corvus had cash, cash equivalents and marketable securities totaling $74.4 million as compared to $52 million at December 31, 2024. During the second quarter, all of the remaining common stock warrants were exercised, resulting in cash proceeds of approximately $35.7 million which included $2 million from warrants exercised by our CEO, Dr. Miller. Based on our current plans, we expect our current cash to fund operations into the fourth quarter of 2026.

I now turn the call over to Richard, who will discuss our clinical progress and elaborate on our strategy and plans.

Richard A. Miller: Thank you, Leiv, and good afternoon, everyone. Thank you for joining us today for our update call. Our main focus continues to be the development of soquelitinib for atopic dermatitis, where we believe we are uniquely positioned with an oral medication featuring a novel mechanism of action that so far has shown favorable safety and efficacy profile. We are making significant progress on multiple fronts, including new data from our Phase I trial reported in June that increases our confidence in the long-term potential for soquelitinib in this indication and beyond. On today’s call, I will provide a high-level recap of this data, review our go-forward clinical plans, including our planned Phase II trial design and briefly discuss our progress with our other clinical programs.

We view the data through Cohort 3 of the Phase I trial as very encouraging. All of the treatment cohorts demonstrated a favorable safety and efficacy profile compared to placebo and Cohort 3 data is especially exciting, demonstrating earlier and deeper and more durable responses compared to Cohorts 1 and 2. Specifically, at just 4 weeks of treatment, Cohort 3 showed a mean percent reduction of EASI score of 64.8% compared to 54.6% for the combined Cohorts 1 and 2 and 34.4% for placebo. No placebo patients achieved the clinically meaningful endpoints of EASI-75, EASI-90 or IGA 0 or 1. We compare this to the results seen for the soquelitinib patients where many achieved these endpoints. In Cohort 3, 50% of patients achieved EASI-75, 8% achieved EASI-90, and 25% achieved IGA 0 or 1.

This compares to 29%, 4% and 21% in the combined cohorts 1 and 2 that were treated, respectively. In terms of the kinetics of response, Cohort 3 showed earlier and deeper separation from placebo beginning at day 8 with the EASI score improvement continuing through day 15 and 28 and far beyond. For Cohorts 1 and 2, the separation from placebo began at day 15 and showed continued separation at day 28. For all 3 cohorts, this separation was maintained during the 30-day post-treatment follow-up period. In addition, for all 3 cohorts, the downward slope of the curves at day 15 to day 28 suggests that longer treatment duration could potentially deepen responses further. We also have found a remarkable impact on PP-NRS, a patient self-reported assessment of itch.

A number of Cohort 3 patients reported steep drops in the score beginning at day 8, which aligned with the reductions we see in serum cytokine levels of IL-31 and IL-33. Both of these cytokines are known to be involved in the itch response. In addition, other biomarker data from the trial continues to support the ITK inhibition mechanism of action, including the potential induction of anti-inflammatory T regulatory cells. Regarding safety, there were no safety issues observed with soquelitinib with no significant differences between treatment and placebo groups and no clinically significant laboratory abnormalities were seen. The total current treatment experience with soquelitinib now involves over 150 patients with T-cell lymphoma or atopic dermatitis, representing more than 9,000 patient treatment days.

In our lymphoma trial, some patients have been on continuous daily therapy up to 2 years. Based on the results obtained to date, we are advancing the clinical development of soquelitinib in 2 ways. First, we amended the Phase I trial protocol to replace the previously planned Cohort 4 with an extension Cohort 4 that will evaluate an additional 24 patients at the Cohort 3 dose of 200 milligrams twice per day given for 8 weeks with an additional 30-day follow-up without therapy. The 24 patients will be randomized in a blinded fashion 1:1 with placebo, 12 active and 12 placebo. The extension Cohort 4 will give us data on a longer treatment duration of 8 weeks versus 4 weeks seen with Cohorts 1 and 3. We have now enrolled more than half the patients and continue to anticipate that data from the extension cohort will be available in the fourth quarter.

Second, we are finalizing the design of our planned Phase II clinical trial of soquelitinib for atopic dermatitis, and I am happy to share those plans with you now. The trial will be an international randomized, placebo-controlled and double-blinded. The company will also be blinded. It will enroll approximately 200 patients with moderate to severe atopic dermatitis that have failed at least one prior topical or systemic therapy. Patients will be required to have a baseline EASI score that is greater than or equal to 16, IGA of 3 or 4 and body surface involvement that is greater than or equal to 10%. The patients will be randomized equally into 4 cohorts, 50 patients in each cohort receiving either 200-milligram soquelitinib once per day, 200 milligrams twice per day, 400 milligrams once per day or placebo.

Let me repeat those groups, 200 milligrams once per day, 200 milligrams twice per day, 400 milligrams once per day or placebo. The treatment period will be 12 weeks, and patients will be followed for an additional 30 days without therapy. The primary endpoint will be the percent change in EASI score from baseline to week 12. Secondary endpoints will include the percent of patients achieving EASI-75 or IGA 0 or 1 at week 12. The impact on itch will be measured by percent of patients achieving greater than or equal to 4-point decrease in the PP-NRS scale at week 12 and of course, safety as well. We anticipate including 30 to 40 clinical trial sites globally. We are currently finalizing the trial design with the investigators with strong interest from many leading centers, and we are on track to initiate the trial before the end of the year.

Outside of our clinical trials, our partner in China, Angel Pharmaceuticals, plans to initiate a Phase Ib/II trial of soquelitinib for atopic dermatitis in China. This study will enroll 48 patients and is anticipated to build on the data from our Phase I trial by studying a longer treatment period of 12 weeks and an additional dosing option of 400 milligrams once daily, in line with the direction we are headed with our Phase II trial. Briefly on our other clinical programs, we have submitted an abstract to present the final results from our Phase I clinical trial of soquelitinib for the treatment of relapsed/refractory T-cell lymphomas at the American Society of Hematology meeting in December. We continue to enroll patients in our registrational Phase III trial of soquelitinib in patients with relapsed PTCL, driving towards interim data in late 2026.

In addition, patient enrollment is ongoing in our Phase II trial of soquelitinib in patients with ALPS, autoimmune lymphoproliferative syndrome. Depending on enrollment trends, it is possible we could see initial data from the Phase II ALPS study in late 2025 or early 2026. We have completed enrollment in our Phase II trial with ciforadenant in renal cell cancer. These data will be presented in an oral presentation in October at the ESMO meeting, European Society for Medical Oncology. In closing, the soquelitinib results in atopic dermatitis and T-cell lymphoma underscore the importance of ITK as a critical target for a range of diseases involving inflammation and cancer and the broad potential for soquelitinib in many areas of medicine, such as dermatology, oncology, rheumatology, pulmonary medicine and other areas.

We feel we may be entering a new era of immunotherapy for autoimmune inflammatory diseases that is based on drugs with novel mechanisms of action that modulate or rebalance immunity by keeping pro-inflammatory or aberrant T cells in check. This potential has motivated us to complement the development of soquelitinib with the discovery and development of next-generation ITK inhibitors with unique properties. In the near term, we look forward to continuing the clinical development of soquelitinib in atopic dermatitis and PTCL and look forward to providing updates on our programs in the coming quarters. I will now turn the call over to the operator for a questions-and-answer period. Operator?

Q&A Session

Operator: [Operator Instructions] Your first question comes from Jeff Jones.

Jeffrey Michael Jones: Congrats on a hugely productive quarter. I guess you’ve got a plethora of opportunities in front of you. As you think about Cifo in autoimmune disease, in addition to accelerating as you are in the Phase II, how are you thinking about next indications and financially being able to support the many opportunities that Cifo represents?

Richard A. Miller: Okay. So Jeff, let me first correct. Yes, Cifo is renal cell cancer. But soquelitinib obviously, we’re pursuing aggressively atopic dermatitis, but we’ve already begun to think about follow-up indications. And the 2 indications that we’re thinking about, we’re thinking about 2 of them. One, of course, would — we sort of want to maintain our presence in dermatology. We have experience there now. We have a lot of information on, we think, the behavior of the drug in these cutaneous diseases. So I think a likely target for us might be something like hidradenitis suppurativa. There is totally unmet need there, I would say. And then the other disease moving away from dermatology in the inflammation area would be pulmonary disease.

Asthma is probably scientifically the most justification for a disease is probably asthma. We have 3 or 4 different animal models where we see excellent activity of our drug in asthma, both acute and chronic. Also the mechanism of action, specifically the inhibition of what are called innate lymphoid cells really leads us to believe that we might have a very important novel approach to asthma and perhaps other pulmonary diseases. But you’re quite right. We — it is difficult for us to pursue all these indications. But we’ve shown that we’re very adept and agile in terms of efficiently maximizing the value of, I’d say, each of our products.

Jeffrey Michael Jones: I appreciate that. And then the follow-up question is actually on Cifo. In terms of the renal update coming at ESMO, how are you thinking about next steps for the program, assuming with [ an oral ] that there’s going to be a positive update here on the program?

Leiv Lea: Okay. So just to remind everyone, ciforadenant is an A2A antagonist, the oral medication. We did a Phase II study in first-line renal cell cancer, patients who are receiving ipi + nivo. So we added the A2A antagonist. And the idea there, of course, is to look at response rate, but also very importantly, to look at since they stay on the A2A antagonist every day for a long time, they get the ipi + nivo for a short time. I think one of the things that we’ll be looking for in addition to, of course, objective responses is the durability of responses and PFS in other words. So let’s see what that data is. This is a study that was conducted by the Kidney Cancer Consortium, several centers, MD Anderson, Vanderbilt and several others.

They ran that study. We, of course, provided the drug and some financial support. So let’s see what’s presented in an oral presentation at ESMO, and then we’ll go from there. Based on the data that comes out of that, we’ll make our decisions about how to follow up on that.

Richard A. Miller: Okay. But it is quite a unique study. I mean, it’s first-line disease. It’s renal cell cancer. We know that’s immune-responsive. I’m emphasizing this because I know today some other company came out with some A2A stuff, and I think it was metastatic colon cancer, and they had chemotherapy and a number of various treatments there and one of the things that we’ve always done well is to carefully study our agents initially as a monotherapy and then move into combinations where we have a good understanding of the efficacy and safety and mechanism. So that’s helped us a lot. Does that answer your question?

Jeffrey Michael Jones: It does.

Operator: The next question comes from Graig Suvannavejh.

Unidentified Analyst: This is Sam on for Graig. Congrats on the progress. Maybe just a quick one on soquelitinib and PTCL. Just curious how the enrollment is going and if the previous guidance for data in late 2026 is still there.

Richard A. Miller: Our guidance is still intact. We’re enrolling according to plan. We have probably about 20 centers open now. These are the best of the best centers in the United States and Canada. So everything there is going according to plan. And we’re hoping that our presentation on the Phase I will really start to focus attention on this drug.

Operator: Your next call comes from Aydin Huseynov.

Aydin Huseynov: Congrats with the quarter. A couple of questions from us. So could you walk us through the decision process, thinking process regarding the Phase II trial design for atopic dermatitis. So I appreciate giving us color about 4 different cohorts, 200 Q.D., 200 B.I.D., 400 Q.D. and placebo. Just so far, we see in atopic dermatitis, the most productive cohort is Cohort 3. So I was curious to better understand, was it more like an FDA suggestion to give a little bit weaker dose, a little bit harder — a little bit stronger dose? Just walk us through the process, if you could.

Richard A. Miller: Okay. Thank you for that question. So first of all, there’s a lot of precedents now for Phase II trials in atopic dermatitis. We’re not the first company to do that. And a 200-patient trial with roughly 50 per arm is, I would say, pretty standard. And you are correct, Aydin. Usually, there is — the FDA wants to see some dosing — different doses studied so that you can determine what’s the lowest dose that’s possibly effective and what’s a higher dose that becomes maybe not more effective than another dose. So we selected these doses because the 200 once a day, we think is active. We don’t think it’s going to be — and we’ve already tested it. You’ve seen that data in Cohort 2. I think that will be an active dose.

It’s a single — it’s a daily dose. Some people, of course, prefer a single dose, once-a-day dosing for atopic dermatitis. But the 200 B.I.D., we saw a better response. That’s a doubling of the dose in our Cohort 3, and that’s what we’re studying in our extension now. So that’s the second cohort, 200 once a day, 200 twice a day. And then, of course, we want to do 400 once a day, same total dose as the 200 B.I.D., but given once a day. I think we can do once-a- day dosing. So this will give us an opportunity to confirm that. And then, of course, placebo. I can’t emphasize enough how important it is to have placebos in Phase I and Phase II trials. I am seeing companies now do these studies with no placebos, and it’s absolutely astounding to me.

But in any event, so 50 patients in each arm, 200 total, placebo-controlled, totally blinded, company is blinded. The endpoints are pretty standard. The mean percent change in EASI is the usual primary endpoint for a Phase II study, secondary endpoints being EASI-75s and IGA-0 and 1s. So that’s all really pretty standard. Yes, and we’re moving to 12 weeks of therapy. We’ll have experience with 8 weeks of therapy, which we already have right now. And we think that, that should give us a pretty good result. In terms of the statistics, if we have even a 20% improvement in any of the groups, you can just — we can just look at any one group versus the placebo. If we’re 20%, 22% better, we want to — we expect to be better than that. But even if that’s at the lower end of our — of our information.

We have an 80% power to see that a p-value of 0.05 on that. And in the Phase II trial, that will be fine. So the sizes statistically make sense. The dosing makes sense based on what we know and what we also know about occupancy and the receptor. And we think this is a very manageable trial for us. There’s a lot of experience in doing these international Phase IIs, 200 patients would be very manageable for a company like Corvus. I hope that answered your question.

Aydin Huseynov: Absolutely. Yes, it does. Just wanted to — a couple of follow-up questions on this trial. So I know this could be a little bit early, but would you be able to provide the time line, when do you think we can see the results? I mean, I understand this is randomized blinded trial, but if you could give us some hints in terms of when it could be ready.

Richard A. Miller: Okay. No, happy to give that. We’ve, of course, been thinking about that. I think you’re looking at enrollment in 12 to 15 months, maybe you have results in 18 months, and we’ll start the trial in December. And we have a couple of things, I think, going for us. Obviously, it’s oral. That should help enrollment. I think the second thing, novel mechanism of action, I think that will also facilitate enrollment. We’re not requiring biopsies, although we’re going to have some centers where we’re going to try to motivate people to do some biopsies. But of course, that should also improve enrollment. But the biggest thing that’s going to facilitate enrollment is that we are allowing patients who have failed systemic therapies.

So that really opens up the potential patient population. So many of these studies, they won’t take you if you’ve already failed a systemic therapy, a JAK inhibitor, let’s say, or a dupi or something like that or an anti-IL-13, but we’re allowing those patients. And the reason we’re allowing those patients is because our mechanism of action is completely distinct from those, number one. And number two, we’ve had patients like that on our study so far, and it hasn’t mattered — they’ve done just as well.

Aydin Huseynov: So my assumption is that you’ll probably be stratifying based on which exactly therapy they failed topical or systemic but yes.

Richard A. Miller: Absolutely. I mean there are a few things you might stratify on. Obviously, EA — I mean, if you’re baseline EASI score, that will be a stratification factor and whether or not you failed the systemic therapy. Yes. We haven’t gotten into that degree of detail yet, but there’ll probably be 2 or 3 different stratification factors. You can’t get too many in a study with only 200 patients.

Aydin Huseynov: Right, right. Yes. And my question I have was about the next-generation ITK inhibitor. As we move forward with that, could you give us some thoughts on how it will be different from soquelitinib and which indications you’d be planning to target if it’s not too early?

Richard A. Miller: Okay. So first of all, for certain intellectual property reasons, I’d rather not go into the details of how they’re different because there are a lot of people who are now working on ITK inhibitors. And I’d rather not go into the details. But suffice it to say, let me answer your question this way. ITK plays many roles in a cell, T cell receptor signaling, everything from T cell receptor signaling to control of Th2 cytokine production to apoptosis. And we think we have compounds that might work better for some of those indications than others or some of those mechanisms. So let me answer it that way.

Operator: There are no further questions at this time. I will now turn the call over to Richard Miller. Please continue.

Richard A. Miller: Thank you, operator. First of all, let me thank everyone for participating in today’s call. Look forward to updating you again in the next quarter and updating you on the progress with all our clinical trials. Thank you very much.

Operator: Ladies and gentlemen, that concludes today’s conference call. Thank you for your participation. You may now disconnect.