Kymera Therapeutics Inc

NASDAQ:KYMR

Earnings Call Transcript 2024-Q1

[Operator]

Good day, and welcome to the Kymera Therapeutics First Quarter 2024 Results Conference Call. [Operator Instructions]. Please note that this event is being recorded.

I would now like to turn the conference over to Justine Koenigsberg. Please go ahead.

[Justine Koenigsberg, executive]

Thank you. Good morning, and welcome to Kymera's quarterly update call. Joining me this morning are Nello Mainolfi, President and CEO; Jared Gollob, our Chief Medical Officer; and Bruce Jacobs, our Chief Financial Officer.

Following our prepared remarks, we will open the call to questions. To have enough time to address everyone's questions, we ask that you please limit your questions to 1 and a relevant follow-up.

Before we begin, I would like to remind you that today's discussion will include forward-looking statements about our future expectations, plans and prospects. These statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected. A description of these risks can be found in our most recent 10-Q filed with the SEC. Any forward-looking statements speak only as of today's date, and we assume no obligation to update any forward-looking statements made on today's call. With that, I'll now turn the call over to Nello.

[Nello Mainolfi, executive]

Thank you, Justine. Good morning, everybody. It's been a very productive beginning of 2024, starting in January with an extensive update at our immunology R&D Day and a subsequent financing to provide capital that we will invest in our expanding clinical development efforts and growing pipeline.

Past quarter has been focused on execution on both our preclinical and clinical pipeline as well as external engagement across a variety of business and medical conferences. Today, our plan is to share a brief update on our programs as well as time lines for news and catalysts, we're expecting through the rest of this year and early '25.

As we shared earlier this year, we believe we have a significant opportunity to address and expand the existing treatment paradigms within immunology by developing compelling for small molecule degrader medicines with biologic flight activity. Has it been the case all the way back to the timing of the company, we have taken a differentiated approach to target selection and focused on critical molecular pathways that are well validated through human genetics, clinical evidence and/or the success of approved drugs. Many of these pathways play a key role in a new mediated disease pathology. And while injectable biologics dominate these markets often due to their strong [indiscernible] activity, they are not without limitations, which in many instances can limit penetration.

As a result, we believe developing convenient oral options with biologics like activity and a good safety profile represents an enormous opportunity to expand patient access in many of these markets that are currently dominated by injectable agents. Our IRAK4 program, which was our first program to enter clinical development, it simplifies a target and a pathway that has the potential for a broad patient impact. We have talked in the past about our reasons for enthusiasm around IRAK4 as a target and our rationale for pursuing it.

IRAK4 is an obligated node in the IL-1/TLR signaling that we believe its degradation is the only approach to fully block the pathway, creating multiple development opportunities in large higher met need indications.

In the KT-474/RF4 Phase I trial, we observed deep and well tolerated degradation, early signs of clinical efficacy and high fidelity of translation from preclinical models to patients which provide key insights for our growing immunology pipeline and position future programs such as our STAT6 and TYK2 programs for success.

In March, we had the opportunity to showcase our propreitory immunology programs, KT-621, as STAT6 degrader and KT-294 as TYK2 degrader at the American Academy of Dermatology Annual Meeting. The poster presentations, which marked the first data from a STAT6 targeted agent and a TYK2 degrader to be shared at a major medical meeting, highlighted our robust preclinical packages and support the significant potential of our oral degraders in these pathways.

In our KT-621 [indiscernible], we've highlighted the preclinical efficacy studies comparing KT-621 to dupilumab in a preclinical atopic dermatitis model. Importantly, KT-621 showed robust activity in vivo in this model, EPO or superior to dupilumab. KT-621 degradation of STAT6 was well tolerated in multiple preclinical safety studies and doses concentration up to [indiscernible] above the projected human efficacious concentration. If we can indeed deliver biologic flight activity, good safety profile and oral once-daily dosing, we believe KT-621 could change the treatment paradigm with millions of patients suffering from TH-2-driven information.

In terms of timing, KT-621 is currently in 9 labeled studies and is on track to enter Phase I testing in the second half of 2024. It's our intent to conduct a Phase I healthy volunteer study to assess single and multiple ascending doses of KT-621 and move quickly from their invitations. We have finalized our clinical development plan and strategy, and we look forward to sharing more details as we move closer into the development.

Moving to TYK2 we shared a poster AAD that demonstrated picomolar degradation potency, alone nanomolar inhibition of IL-23, IL-12 and Type-1 interferon partners, showing KT-294's potential to recapitulate the biology of human TYK2 loss-of-function mutation. The biological differentiation of KT-294 from [indiscernible] small molecule inhibitors was demonstrating through IL-10 sparing compared to [indiscernible] which is important in inflammatory bowel syndrome as well as was shown through superior inhibition of Type 1 interferon pathway compared to TAK-279, which is relevant for the treatment of several diseases, including [indiscernible] diseases.

Additionally, KP-294 deep and sustained TYK2 knockdown in vivo with low daily oral doses. We believe that this data demonstrates that a TYK2 degrader has the potential to deliver best-in-class TYK2 pathway blockade with productivity across multiple IL-12/23 and Type I interferon [indiscernible].

We intend to continue to share updates across our pipeline and medical meetings in 2024. In fact, later this month, we present poster highlighting KT-621 and its potential to treat TH2 allergic diseases at both the American Thoracic Society International Conference in San Diego as well as at the Digestive Disease week in D.C. These presentations which built on what was previously shared in R&D, they are willing for new, exciting additional [indiscernible] data.

To sum up my intro here, since our finding 8 years ago, a milestone, which we will commemorate just in a few days, we have demonstrated consistent and scalable innovation, including strongly clinical to clinical translation of degradation, safety and activity across the whole pipeline. We have also achieved early proof of concept in both immunology and oncology, which we believe is a significant accomplishment for the new modality. As we are transitioning from early to mid-late development across our pipeline, we remain committed to building on our early success in expanding our team and capabilities to deliver on the substantial clinical and commercial opportunities that our programs offer to ultimately become the global commercial stage medicine company.

In the meantime, we look forward to important near-term data readouts this year in oncology and multiple readouts from our immunology pipeline in '25. I'll pause here and ask Jared to provide an update on our clinical program. Jared?

[Jared Gollob, executive]

Thank you, Nello. I'll round out the immunology discussion this morning with IRAK-4 and then give an update on our 2 clinical oncology programs.

Our first-in-class oral IRAK4 degrader, KT-474 is progressing in 2 Phase II trials in hidradenitis suppurativa and atopic dermatitis. These trials are being conducted by Sanofi under our collaboration, and we expect to be in a position to share top line data in the first half of 2025. Recall that Sanofi moved this program into Phase II studies based on the early clinical data we generated in AD patients in Phase I trial.

In that study, not only did we achieve our study objectives in terms of PK/PD and safety, but we also delivered encouraging signs of clinical activity that we will also evaluate over a longer dosing period in the Phase II trials. These randomized placebo-controlled trials represent an opportunity to demonstrate the potential for IRAK4 degradation generally and KT-474 specifically to transform the treatment of complex inflammatory diseases and to offer HS and AD patients of well-tolerated, effective and convenient oral medicines.

Now switching gears now to oncology. I'll start by noting that we recently presented scientific data on our oncology pipeline in both the late-breaking poster session and during the major symposium at the AACR Annual Meeting. As we shared in the past, our preclinical and early clinical findings highlighted last month at the meeting, support the advantages of degraders over other existing technologies and agents and further validate our differentiated molecular design, target selection and translational strategies to advance a new generation of medicines for patients.

KT-253, our highly potent degrader of MDM2 [indiscernible] ligates that modulates most common tumor suppressor [indiscernible] is currently in development for the treatment of liquid and solid tumors. Preliminary data from the Phase I clinical trial showed evidence of target engagement and 253 pathway activation along with initial signs of antitumor activity without dose-limiting toxicities, including typical hematological toxicity. These findings support our therapeutic hypothesis for MDM2 degraders and the potential to improve the therapeutic index compared to MDM2 small molecule inhibitors.

As we finish dose escalation in the Phase I trial this year, we hope to see antitumor activity in a variety of tumor types. And coupled with our biomarker selection strategy, we plan to assess these data collectively to inform next steps.

Finally, on MDM2, we are announcing today that we've had an abstract accepted for a poster presentation at ASCO in June, where we will provide a clinical data update. Once the trial is completed, we expect to present the full data set at a medical meeting later in the year.

KT-333, our highly selective degrader of STAT3, a traditionally undrawn transcription factor recognized as a key component of the JAK-STAT signaling pathway with both tumor cell intrinsic and tumor cell extrinsic effects on the tumor microenvironment is currently in development for the treatment of multiple STAT3 dependent pathologies, including hematological malignancies and solid tumors.

Preliminary data from the Phase I trial demonstrated early signs of anti-tumor activity at doses that were generally well tolerated and associated with substantial STAT3 knockdown in blood and tumor. Our preclinical to clinical translation showed some early, but encouraging responses in both CTCL and Hodgkin's lymphoma. We also demonstrated simulation of an inherent gamma response in tumor in blood, which is encouraging given the correlation between interferon gamma and how tumors respond to anti-PD-1 drugs. This escalation of the KT-333 Phase I study is ongoing, with the goal to further assess safety and antitumor activity in both liquid and solid tumors. We expect to complete the study this year and deliver additional proof of concept data to define KT-333's path to late-stage development.

We are also announcing that we've had an abstract accepted for presentation at the European Hematology Association, or ECOG Meeting in June, where we will present a clinical update. We plan to present the full data set at a medical meeting later in the year. Now I'll hand the call over to Bruce to share financials for the quarter. Bruce?

[Bruce Jacobs, executive]

Thanks, Jared. I'll quickly review our first quarter 2024 financial highlights, and you can certainly reference the tables found in today's press release. Revenue in the quarter -- the first quarter of 2024 was $10.3 million. All of that was attributable to our Sanofi collaboration. And just as a quick reminder, we have received or have received $55 million in total milestones as a result of the start of the 2 Phase II truck studies in the fourth quarter of last year. .

With respect to operating expenses, R&D for the quarter was $48.8 million, about $6.1 million of that represented noncash stock-based comp, resulting in an adjusted cash R&D spend of $42.7 million, a 10% decrease from the comparable amount in the fourth quarter of 2023.

On the G&A side, our spending for the quarter was $14.4 million, of which $5.9 million was stock -- noncash stock-based comp. The adjusted cash G&A spend of $8.5 million, again, excluding the stock-based comp, reflects a 1% decrease from the comparable quarter -- sequential quarter. Our cash balance at the end of the first quarter was $745 million in January. As we mentioned, we realized approximately $300 million in net proceeds from our equity offering. Our cash balance is expected to provide a runway into the first quarter of 2027 and that will enable us to execute on multiple or I should say, the first half of '27, that will enable us to execute on multiple data readouts, including oncology proof-of-concept results in 2024 and KT-474, Phase II data expected in the first half of 2025 and several clinical inflection points for our STAT6 and TYK2 programs also in 2025.

So this concludes our prepared remarks. We'd be happy to take your questions. Operator, if you can open the line for questions. Thank you.

[Operator]

[Operator Instructions] The first question is from the line of Brad Canino from Stifel.

[Bradley Canino, analyst]

It looks like we're going to get 2 bites out of the apple for MDM2 this year. And generally, I would assume that the completed 1a and the biomarker data later this year would be most material. So just to not overlook what's coming at ASCO, can I have you talk about the decision to present here? What should be the focus? And how should investors view it within the broader trial and strategy for the asset?

[Nello Mainolfi, executive]

So thanks, Brad. So just taking a step back, this is a program that we started clinical development in the second half, roughly the middle of last year. And our first update with [indiscernible] in November, if you recall, of last year, and we present [indiscernible] limited data as we since then recruited many more patients in the solid tumor lymphoma arm as well as open the AML arm. We thought it was important to connect with the medical community and obviously, the investor community to give an update on the progress we've made in both arms of the trial, that I believe will shine more light on the potential of MDM2 across the subset of patients and also create more enthusiasm as we can to continue to recruit the right type of patients who are studied. .

So obviously, when we share data, there are multiple audiences and the investor community being 1 of them. The goal is to complete as we said in the press release, this Phase I dose escalation study by the end of the year and then, yes, provide a full update as well as planned for further development later in the year. But given the substantial delta of patients recruited between November and now, we thought this would be a good update to showcase the progress of the program.

[Bradley Canino, analyst]

Okay. And then Nello, I know you took part in a targeted protein degradation symposium at AACR. I'd just love to hear what your general insights were thoughts were exiting that about the evolution of this therapeutic area?

[Nello Mainolfi, executive]

Yes, that's a great question, Brad. So first, it was a great meeting, I believe I saw you there. If you would very well attended, let's call it symposium with many companies presenting, I actually hadn't been in [indiscernible] focused symposium in probably too long. And so it's great to see a huge amount of interest from many stakeholders in the space. I saw many physicians, small and large companies. So I think the level of interest is increasing with the data, especially clinical data that different companies are sharing.

I also came home with a great feeling that companies like Kymera are really leading the field here in terms of capabilities, target selection, sophistication of approach. And so I think generally, there's still a lot of work to do for the field, but I'm glad that we and others are leading in providing, hopefully, a good example for others to follow.

[Operator]

The next question is from the line of Ellie Merle, from UBS.

[Unknown Analyst]

It's Sam on for Ellie. I guess just in line with the previous question, from the MDM2 update at ASCO, can you provide any color on I guess, like the extent of data that we could be expecting from the study? And I guess, what kind of efficacy measures we should anticipate to look for? And what are you guys looking for from the data as you think about the development path forward?

[Jared Gollob, executive]

Great. Thanks for the question. I mean this is really planned to be a clinical update for the Phase Ia dose escalation, so really to show the progress that we've made since last November. So the goal here is to share additional information on the types of patients we've enrolled, both solid tumor patients as well as patients with hematologic malignancies to share the safety that we've been seeing as we've been dose escalating to share more data on the pharmacodynamic effect of the drug.

Recall that back in November, we did show an impact on [indiscernible], which is this key biomarker, just downstream of MDM2. So our aim is to show more data that provides that sort of information on pharmacologic engagement and, of course, to provide whatever response data we have, clinical response data we have for patients with solid tumors and patients with hematologic malignancies.

[Unknown Analyst]

Okay. Great. And I guess just a quick follow-up. Just any color on the updates for the biomarker patient selection strategy you guys are pursuing? And how is the progress kind of going there?

[Jared Gollob, executive]

Yes. I think that's an important question. I think Nello mentioned that earlier, which has been an important part of the program for MDM2 in addition to being able to demonstrate that the therapeutic index with our degrader is superior to what we see with MDM2 inhibitors, is to be [indiscernible] evolve a sort of patient selection strategy or so-called [indiscernible] strategy for selecting patients who we think will be most sensitive to this treatment.

If we don't plan on providing that particular update at ASCO, but our anticipation is that later in the year, [indiscernible] at a medical meeting, we will provide more of those data showing our progress preclinically and even perhaps some of our clinical data that have been informing our ability to develop a patient selection biomarker strategy, focusing on those patients we think we'll be able to predict would be most sensitive to MDM2 degradation.

[Operator]

The next question is from the line of Michael Schmidt from Guggenheim Securities.

[Unknown Analyst]

This is [indiscernible] for Michael. We wanted to get your thoughts on recent [indiscernible] data that showed superiority over DUPIXENT as you think about the opportunity for your IRAK-4 and STAT6 degrader. Do the level of results shift the bar for an oral agent in AD and potential other indications. And as a related question, what's your strategy on future head-to-head studies against biologics for your overall II portfolio?

[Nello Mainolfi, executive]

Yes. It's a great question. So I don't think we're learning today that inhibiting [indiscernible] kinase is extremely powerful antivamatory mechanism. [indiscernible], I think if you look across several indications, not only in AD, you see JAK inhibitors being extremely active. So I don't believe we learned anything new. I think what we are proposing here at Kymera is to use protein degradation to after targets that provide the best efficacy to safety profile. .

So the opportunity here is to have an oral drug that is well tolerated, that does not require blood or monitor blood testing or monitoring of patients for severe cardiovascular events. So I don't think the bar has moved at all. I think we -- the field is still looking for oral agents that are active that have a [indiscernible] profile. And that's really what we're trying to do for both IRAK and STAT6 [indiscernible] in a different way. Obviously, we get discussed each program individually.

[Operator]

The next question is from the line of Eric Joseph from JPMorgan.

[Eric Joseph, analyst]

Just wanted to get a little bit of a better sense of what your internal bar is for moving 253 [indiscernible] stage development. I wonder whether opportunities in [ hemalignancy ] will be strategically attractive enough? Or do you want to think broader than encompasses solid tumors as well. And additionally, is the focus more on moving forward with a monotherapy strategy, would you be amenable to combination approaches?

[Nello Mainolfi, executive]

Yes. Thanks, Eric. Maybe I'll start and then pass it to Jared. So first, I would say the reason why we got involved with MDM2, which, as we all know, is a target that has been pursued by the whole -- the industry in the past 15 years or so is -- so the reason for us to do so is to really unlock a broad variety of tumor types that we have seen are extremely sensitive to removal of MDM2, which is quite different in our view from inhibition [indiscernible] interaction that small molecule needed.

Looking to [indiscernible] saying, we have develop sensitivity not, let's say, across tumor cards, they point to the subset of tumors in which we've seen preclinically and we'll start sharing some clinical data, but we've seen preclinically second say so far to be extremely sensitive to these mechanisms. When those go across both [indiscernible] as well as solid tumors. I think we've shown already preclinically that AML especially both as a single agent as well as combo, but we've seen some really, really almost best-in-class activity. And this is an area that we would pursue independently of the opportunity for tumors, given the high unmet need that still be relevant commercial opportunity for both [indiscernible] but also for refractory AML.

So I think I would say that the AML opportunity is in a way, independent of solid tumor, but I also would want to say that the impetus to work on MDM2 was to go beyond hemo-oncology. So we have hopefully exciting plans that we can share with you based on the biomarker strategy that see us expanding in solid as well.

[Operator]

The next question is from the line of Kalpit Patel from B. Riley.

[Unknown Analyst]

This is Jay for Kalpit. Just 1 on the [indiscernible] program. The question is if you have the opportunity to discuss the divestment of your [indiscernible] degrader with Sanofi -- if so, could you show any insight into why perhaps Sanofi opted to collaborate with another [indiscernible] company instead?

[Nello Mainolfi, executive]

Yes. So as we said repeatedly in the past, I say this again today, we started this program a few years ago. We have built conviction around our ability to use oral degraders in immunology, starting from early days in IRAK4. And we have decided that we have no interest in partnering our immunology pipeline in order to -- list in the foreseeable future in order to fulfill our vision to building a global integrated company. .

I'm not going to obviously share discussions with [indiscernible]. But I would say, generally, this is a program that has been pursued from other parties quite heavily in terms of potential partnerships, but our communication has been very clear that we believe this is a program that we want to develop as a stand-alone independent company for the foreseeable future.

I will also remind everybody that we are the first company to take a [indiscernible] actually, I would say, static agent overall in the clinic, we the first company to demonstrate the preclinical activity of such an agent and everybody else is obviously years behind us.

[Operator]

The next question is from the line of Andy Chen from Wolfe Research.

[Andy Chen, analyst]

Two related questions also on STAT6. Just curious if you can talk about tissue distribution. And so I see deep degradation in the skin and nonhuman primates. I'm just curious how well this tissue distribution translates to humans. I'm curious if you're going to cite several precedents where this nonhuman primary distribution is highly correlated to humans.

And also in the first half of '25, are we going to gain any insight on this exact topic. What kind of metrics will we have when determining whether STAT6 is indeed acting on the skin in humans?

[Nello Mainolfi, executive]

Yes. No, it's a great question. So first, for people that have followed us over the past few years that we don't discuss preclinical data of [indiscernible] and distribution besides the big relation data that we show in our presentation, and that's only because we believe those are highly confidential and important data that we will not keep for ourselves at this point. But I will say that if you look at the data we presented, as we've shown, that KT-621 degrade STAT6 equally effectively in several tissues in skin and lung [indiscernible] and I believe in spleen too, I'm not sure we've shown that or not. But we've shown that our -- the distribution of the drug allows for I would say, generally equivalent degradation across all TH2 relevant tissues. And so we -- our expectation is to see in the clinic, the same level of response. And we've seen good translation of preclinical into clinical in terms of distribution across different species.

I would say that, yes, in the first half of '25, our goal is to share Phase I data, it's been publicly disclosed, and the Phase I data will involve both blood and skin biomarkers.

[Operator]

The next question is from the line of Derek Archila from Wells Fargo.

[Unknown Analyst]

This is [indiscernible] on for Derek. So a quick 1 from us kind of like following up on the last question. On the STAT6 Phase I study, will you be including a cohort of patients to achieve this proof of concept kind of like how you did with like 474? Or will this only be including healthy volunteers?

[Nello Mainolfi, executive]

Well, at this point, I think all we said today was that the initial evaluation being [indiscernible] volunteers, we'll share more at a later date.

[Operator]

The next question is from the line of Divya Rao with TD Cowen and Company.

[Divya Rao, analyst]

This is Divya, on for Marc. More to the earlier question, what is the scope of kind of the disclosure that we should get from KT-333 at EHA? And then -- as a follow-up, I guess, what do you need to see in this Phase I trial, which, I guess, you're planning on completing at the end of the year and liquid tumors to continue development in both liquid and solid tumors?

[Nello Mainolfi, executive]

Look Divya, I'll take the second, and I'll let Jared answer the first part of your question. So the second part was around what we need to see. So as I said in the past also, our bar for continuing investment is having meaningful opportunity with a clear path to a sizable patient population with big clinical and commercial impact. And so obviously, the more obvious answer to your question is that solid tumor opportunities would be able to make a much easier case for further investment.

As I've said in the past, we don't expect to see single-agent activity in solid tumor as we haven't seen preclinically, but we're evaluating the biomarker, the tumor biomarker effect to then tie with preclinical data that we've -- that we've already demonstrated in this potential solid tumor combo opportunities. So that is one.

And then obviously, having strong antitumor activity as a single agent [indiscernible] tumor is important for 2 reasons. One, because there are potential liquid tumor opportunities that are sizable with us to be interesting, but also to confirm that the drug is active and it's worthwhile further investment in expanding the opportunity. Jared, do you want to comment a bit on the expectations for EHA?

[Jared Gollob, executive]

Sure. Recall that at ASH this past December, we presented data on 29 patients that we had enrolled so far. And we show very encouraging safety data, which was allowing us to continue to dose escalate. We showed very strong pharmacodynamic data, including strong statuary knockdown in blood and tumor as well as strong immunomodulatory effects in blooding tumor, such as that [ indopurian-gamma response ] that was predictive of potential combination with anti-PD-1. And we also showed these promising clinical responses [indiscernible] as well as in Hodgkin's lymphoma.

So the aim for the EHA presentation is really to build on that as we continue to dose escalate to provide further data around safety as we've been dose escalating to provide additional pharmacologic data on target knockdown and immunomodulation in blood and whatever we may have in tumor and to provide additional clinical response data.

Again, as we said, this is meant to be a clinical update and then the plan will be then later in the year once we anticipate completing dose escalation to provide a final data set at a medical meeting later in 2024.

[Operator]

The next question is from the line of Thomas Smith from Leerink Partners.

[Unknown Analyst]

This is [indiscernible] on for Tom Smith. We have 2, both in [indiscernible]. So the first 1 is what's the gating factor to initiate Phase I trial for KT-621, and whilst data you expect from the readout is be in first half '25, would help me [indiscernible] indications for the subsequent development in [indiscernible] indication?

[Nello Mainolfi, executive]

Okay. Great. So as we've said on the call today and in the press release. So we're in IND-enabling studies, and we're going to leave it at that. We don't usually provide a specific update on where exactly we are on the process. So obviously, completing that phase, filing IND and initiating Phase I is what's between us and [indiscernible].

In terms of indication prioritization for static, I think the only thing I would say is, as we said in the past also, we are focused on getting this drug to as many patients as possible, starting with large indications where we've seen injectables can really have low penetration for many, many reasons. So I would say we're prioritizing the larger indications, but that doesn't mean we will not pursue others. I think that will happen, but just in a probably different [indiscernible] manner.

[Unknown Analyst]

Got it. And for the [indiscernible] program with data expected in first half as well of next year, [indiscernible] a decision of going forward or not but you also have an opt-in decision -- like how are you approaching the [indiscernible] and what do you need to see to make a decision?

[Nello Mainolfi, executive]

Yes. So after Phase II, before Phase III -- so the Phase III needs to be in the planning stage when we will have the opportunity to decide to open or not. And the decision will be based on obvious reasons, the excitement we have around the opportunity with the drug, the investment that we have across our pipeline, cash needs that will be needed across the investments across our pipeline. I would say maybe I believe the base case is if the drug is active as we expected it would be, it would be value accretive for us to obtain and so it would be probably an easy decision to make. But you know, it's hard to make decisions in a vacuum. So when we're there, we will make the decisions based on all the other parameters I mentioned.

[Operator]

The next question is from the line of Vikram Purohit from Morgan Stanley.

[Vikram Purohit, analyst]

So we also had a couple of questions on 474. Apologies if you mentioned this in your prior Q&A, and we missed it, but -- we were just curious on how you and Sanofi are currently thinking about indication expansion 474 beyond HS and AD and when some of those decisions could be made and how you're thinking about them for the time being ahead of the HS and AD data sets coming in the first half of next year?

And then secondly, on a more logistical point, should we hold the expectation that the HS and AD data sets would come together? Or is that not necessarily the case? And if you have any visibility at this point on which venues or which forms might be appropriate to showcase those data, that would be a helpful color to get from your perspective.

[Nello Mainolfi, executive]

Thanks, Vikram. We've got 3 questions in, well done. So start with the last one, it's hard for us to know [indiscernible] the timing and where. I said the program time lines have been presented in clinicaltrial.gov or disclosures from both Sanofi and us, we're seeing that both studies should be able to read out in the first half of '25. I still feel we're too early to know whether they will be disclosed together or separately. And so give us more time. I think when we're closed, we might be able to answer that question.

In terms of the indication expansion, as I also have said in the past, we've [indiscernible] on evaluating many other opportunities, many of these are obvious other indications that this biology is being validated in or known to be relevant. I think there is sensitivity about disclosing what they are just because I think the team right now is focused on executing on these studies, I believe Sanofi will be the 1 maybe disclosing other indications first, and then we'll be happy to provide more color.

In terms of timing, again, I can't speak for them. But let's say, for now, we're focused on executing on these studies. And I believe this is a personal opinion, as we get through some of these inflection points, we'll be able to share more.

[Operator]

The next question is from the line of Jeff Meacham from Bank of America.

[Unknown Analyst]

So I guess I have a quick question on giving capital constraints, do you think that there's a scenario where you guys might partner out some of your oncology assets? Like what factors would you take into consideration when evaluating the potential for a partnership?

[Nello Mainolfi, executive]

Yes. So thanks for the question. So generally, as we've said, we believe partnering is an option to continue to grow the company and need to serve the purpose, rarely not always, primarily, I would say that financial drive partnerships, but it has to be really financials only, right? They will like to be a win-win opportunity. I think it's -- the partnering in oncology is something that we've discussed in the past. It might be something that we'd be open to do for some of our oncology programs. I just can't speak to specifics given that we're still in the midst of generating important days and that will -- [indiscernible], first of all, tell us the level of commitment that Kymera on its own once we invest in this program. I think after that, we'll be able to have a clear view of with the best path for value creation for our oncology pipeline. .

As always partnership is tool that any company should use to think about long-term value creation as we can't reinvent the wheel in every single program.

[Unknown Analyst]

Okay. Great. And then what are your priorities for this year?

[Nello Mainolfi, executive]

[indiscernible] .

[Unknown Analyst]

[indiscernible]

[Nello Mainolfi, executive]

Yes. I mean I think I've answered that question already. .

[Operator]

The next question is from the line of Kelly Shi from Jefferies.

[Dingding Shi, analyst]

I also have a question on [indiscernible]. We see the clinical development is expanding in this space and our agents like JAK inhibitor and the [BTK] inhibitor socially interesting advocacy [indiscernible] I'm curious, how should IRAK4 degrader deposition to other [indiscernible], -- what would be the differentiated clinical features to be anticipated based on targeted strategy and also the MOA of the [indiscernible]. .

[Nello Mainolfi, executive]

So it was a -- the sound was not great. But maybe if I understood correctly, you were talking about how is the [indiscernible] compared to like other small molecule JAK [indiscernible].

[Jared Gollob, executive]

Yes. I mean, I think certainly, the differentiation is there potentially both for efficacy based on the mechanism as well as on safety. The 474 IRAK4 degrader because it's impacting the IL-1 receptor pathway as well as the [indiscernible] receptor pathway has the ability to impact multiple different pro-inflammatory cytokines, essentially with a single compound, whereas many other agents in the I&I space, targeted agents, in particular, have a more restricted effect on all of these proinflammatory cytokines. And so the broader effect on multiple different cytokines that think can give us broader development opportunities with an autoinflammatory diseases. I think that is 1 important differentiating factor. .

I think the safety factor is something which also can't be overlooked. We've presented before or summarized before the fact that there are adult human IRAK-4 genetic knockouts who in adults who do not have any phenotype or any susceptibility to infections. And so I think being able to potentially maximize knockdown of IRAK4 chronically to essentially optimize efficacy without compromising safety, I think, is a real central game changer and differentiating factor from other drugs like JAK inhibitors, for example, the JAK inhibitors do have broad anti-inflammatory effects, but they have significant safety liabilities in terms of there's risk of infection, risk of cytopenias, risk of malignancies. That is not something that has been seen in either human IRAK4 knock out individuals or even in preclinical studies. And so I think this ability to potentially really strongly degraded and knockdown IRAK4 chronically to maximize efficacy while not having any safety issues could really allow this drug to be broadly developed across multiple different indications, also not just in moderate to severe patients, but also with milder patients. And I think this really provides an optionality that really can't be seen or were challenged by other modalities.

And so we think that this is 1 of the real value composition of 474 both the differentiation and potentially on the efficacy standpoint as well as on a safety standpoint.

[Operator]

The next question is from the line of Jeff Jones from Oppenheimer.

[Jeffrey Jones, analyst]

Just 2 quick ones from us. There's some evidence of improved efficacy in targeting IL-17 [ ANS ] versus just IL-17A [indiscernible]. And could you comment on whether targeting IRAK4 would be expected to impact the pathway for both forms, -- just a technical question.

And then on the financial side, how should we be thinking about the Sanofi collaboration revenues going forward versus milestone payments?

[Nello Mainolfi, executive]

Right. So Jared will take the first and then.

[Jared Gollob, executive]

Yes. I think the question around the activity of, say, IL-17 AS targeting versus AA, especially in like diseases like HS where there may be an advantage I think sort of more broadly speaking, further, I think, speaks to the advantage of having a broader anti-inflammatory effect versus a more restricted one. I mean here is still restricted to IL-17, but being able to hit the ANF isoforms rather than just, a, is already showing you that as you broaden out the impact, we potentially can increase efficacy.

Now even though IRAK4 does not specifically target the IL-17 pathway, we know that by impacting the IL-1 [indiscernible] pathways as well as the [indiscernible] pathways, we do impact IL-17 production. And while they haven't looked specifically at [indiscernible] versus isoform, we would assume that, that, in fact, is probably broad across multiple different IL-17 isoforms. And so I think to come back to the point I was making earlier, which is that having a drug that have a broader anti-inflammatory effect within these autoimmune diseases that have very pleiotropic inflammation that includes both HS and AD and many others is an advantage -- and I think the 17 AF versus A is just another way to sort of highlight the advantage of going broader and having more efficacy versus being more restricted and narrow.

[Bruce Jacobs, executive]

And Jeff, just to answer your question on revenues, while we don't obviously guide to collaboration revenues, you can see in our balance sheet, the deferred revenue number, it's just over $46 million. That's the amount of revenue we expect to recognize over the near term as we fulfill our performance obligation. The inclusion though, of additional milestones, there's no additional milestones are included in that number. So anything that's achieved with respect to future milestones, those would be largely recognized at that point in time. So that's what I can tell you on that.

[Operator]

Thank you. This concludes our question and answer session. I would like to turn the conference back over to Justine Koenigsberg for closing remarks.

[Justine Koenigsberg, executive]

Okay. Thank you. We'd like to thank everyone for joining us this morning and look forward to keeping you updated on our progress. Later this month, we'll be participating at the BofA conference and hope to see many of you there.

In the meantime, please don't hesitate to reach out if there are additional questions following today's call. Thank you. This concludes today's call.

[Operator]

Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.