RVU120 is a first-in-class CDK8/19 kinase inhibitor. The primary objective of an ongoing Phase Ib study of RVU120 in AML and HR-MDS patients is to determine the preliminary safety profile and the recommended phase 2 dose of RVU120 as a single agent. Characterization of pharmacodynamic (PD) effects is a secondary objective of the trial. PD analysis supports the determination of the recommended phase 2 dose, further clinical development and ultimately positioning of this novel class of targeted agents in the treatment strategies for AML and MDS patients. A battery of tests has been used to establish the relationship between pharmacokinetics (PK) and PD activity, confirm the on-target activity of RVU120, and reveal a mechanism of action of CDK8/19 inhibitors in preclinical models. Specific protein binding of RVU120 in leukemic and normal blood cells has been verified by capturing CDK8/19 kinases after a competition with ATP acyl-phosphate biotin-labeled probes. Changes in CDK8- dependent phosphorylation of STAT5 were used as proximal biomarkers and were measured by flow cytometry. Transcriptome changes were used as downstream biomarkers and were determined by the integrated analysis of bulk RNAseq, ChIPseq and ATACseq. The molecular activity of RVU120 was correlated with anti-leukemic activity and surface marker changes. In patients, PD activity of RVU120 was established by measuring changes in pSTAT5 levels, directly in blast cells and ex vivo in established AML cell lines, exposed to plasma collected from patients treated with RVU120. Downstream transcriptomic effects in patients were assessed by RNAseq and phenotypic changes were tracked by flow cytometry surface marker panels. Preclinical profiling indicated effective CDK8/19 target engagement and inhibition of pSTAT5 levels at low nanomolar concentrations of RVU120, in both established cell lines and primary leukemic cells. The antileukemic activity was tightly correlated with levels of biomarker inhibition, however, in a group of super-responders enriched for NPM1 mutants and leukemic stem cells, efficacy was achieved at partial biomarker inhibition levels. Downstream profiling revealed inhibition of homeobox genes and induction of STAT5-dependent genes as two major transcriptomic programs regulated by RVU120. Homeobox genes inhibited by RVU120 are essential for the viability and self-renewal of leukemic cells, whereas many STAT5 -dependent genes are known as master regulators of erythropoiesis. Consistently, treatment of healthy and transformed CD34+ cells with RVU120 results in the commitment to erythropoiesis. Profiling of patient samples largely confirmed preclinical findings. Inhibition of pSTAT5 in CD34+ blasts from AML and MDS patients tightly correlated with achieved exposures after the first dose and at a steady state. At the time of submission pSTAT5 inhibition has already reached >50%, a threshold that based on preclinical predictions is sufficient for robust efficacy in selected groups of super-responder patients. Further increase at higher doses, is expected to result in deeper, more durable responses in broader populations of patients. Broad transcriptomic changes were observed in patients after treatment with RVU120. Notably, potent inhibition of homeobox genes was observed in NPM1 mutant blasts and induction of erythroid master regulator genes was observed in SF3B1 mutant cells with erythroid arrest. Clear hallmarks of erythroid differentiation were further identified in several patients by specific changes in surface markers. These patients achieved meaningful clinical responses such as reduction of blasts and transfusion independence, respectively.