Welcome, everybody, and thank you once again for joining us to the 45th Annual TD Cowen Healthcare Conference. I'm Yaron Werber from the Biotech team, and it's a great pleasure to introduce Arnon Rosenthal, CEO and Co-founder of Alector Therapeutics, for a very interesting presentation on a fairly rich pipeline, both late stage and early stage, targeting really biologically sort of distinct pathways of the brain. Arnon, thank you so much for coming. We appreciate it.
Thank you for the invitation. Welcome, everyone. As you hopefully know by now, Alector is completely focused on developing disease-modifying drugs for neurodegenerative disorders. This is a very risky field, but also a very high-reward field. We have been doing it for over 10 years now. As Yaron alluded to, we have a combination of two late-stage programs, phase II and phase III, as well as a diversified pipeline of programs and novel blood-brain barrier transport technology, which I will go over. This is an illustration of our pipeline. We have a phase III program in frontotemporal dementia patients where the disease is caused by a mutation in a gene called progranulin. This phase III is a pivotal phase III. it is going to read at the end of this year. If the data justify it, it will follow up with BLA and approval.
In addition, we have a phase II study in Alzheimer's disease. Again, recruitment for this study is almost completed, and we anticipate to read to have data read out by 2026. These are really two major clinical programs. If any of them works, it means the company and the field will be transformed. They are both disease-modifying and novel types of therapies that will change the dementia field. In addition, we have five different preclinical discovery programs that include a diversified portfolio of antibody therapeutics, enzymes, and RNA therapeutics. These therapeutics are selectively incorporating our blood-brain barrier shuttle technology, which will enable better brain delivery at lower doses, the possibility of subcutaneous delivery, a significantly lower cost of goods, and in some cases, decreased adverse effects. This portfolio is a combination of more established targets as well as novel targets.
I'll go over these targets in more detail later in the presentation. Starting with our late-stage programs, our most advanced program is, as I mentioned, in frontotemporal dementia. Frontotemporal dementia is a somewhat less known type of dementia, but it's three times more aggressive than Alzheimer's disease. People who suffer from the disease die within seven to 10 years. The disease appears at the prime of people's life. They can be as early as in their 30s or 40s. It's associated with social disinhibitions, with speech abnormalities. As I mentioned, it's quite little. Recently, some sort of prominent individuals were diagnosed with this disease, like Bruce Willis. The disease received some more acknowledgment. It's a very aggressive type of neurodegeneration with absolutely no disease-modifying or even meaningfully symptomatic treatment.
Since at least a subset of the patients in this disease suffer, sort of develop the disease because there is one missing protein. One protein is produced at insufficient level, and this is enough to cause the disease. This protein is called progranulin. It's a secreted immune regulatory protein, and it's produced in 50% of the normal level. This is what causes the disease. Even though the disease clinically is very complicated, conceptually, what causes the disease is just a deficient single protein. You can view it as an enzyme replacement situation. One enzyme or one protein is missing, causing the disease. We found a way to elevate this missing protein back to normal level. We do it by blocking a degradation cascade of this receptor. What we do is conceptually very similar to what the SSRI inhibitors like Prozac are doing.
Prozac just prevents reuptake of neurotransmitters like serotonin and norepinephrine, increases the level of these neurotransmitters by twofold, and that's what developed the therapeutic benefit. We do the exact same thing here. We block a degradation cascade of progranulin. We elevate progranulin by two to threefold, both in the brain and in the periphery. This is what should give the therapeutic benefit. We went to a phase II open-label study with this drug, which includes both pre-symptomatic and symptomatic patients. We were indeed able to show that our drug can restore progranulin back to normal levels. Before treatment, you see that these patients have half of the normal level of progranulin. Even after one injection of our antibody drug, progranulin shoots up. Basically, this is a normal level that's indistinguishable from what you see in healthy individuals.
You see restoration of progranulin both in the plasma and in the CSF. As long as you deliver the drug, the level of progranulin is normal. We now have patients that have been treated for over two years. Basically, quite safely, this drug restores progranulin back to normal level. Consistent with the normalization of this missing protein, we see also normalization of disease biomarkers in this phase II open-label studies. You see, for example, GFAP, one of the biomarkers that was used for the approval of lecanemab, is abnormally elevated in frontotemporal dementia. After a few treatments, you see that it goes back to normal. The gray bars there are the normal range. You see both in the plasma and in the CSF, we normalize disease biomarkers. We have seen it for multiple biomarkers. I'll just show you one example.
Most importantly, we also saw a slowdown in cognitive decline compared to historical control. With 12 months of treatment, we saw approximately 48% slowdown in cognitive decline in these patients. We think that this is quite profound. If you look at the anti-amyloid beta therapeutics, for example, they were approved based on 25%-30% slowdown in cognitive decline. We here see almost double of the effect. With this data, we went to a phase III placebo-controlled double-blinded study. Because this is a rare disease, this is a pivotal study. We can agree with the FDA that a single phase III study will be sufficient. This drug received both orphan designation and Breakthrough designation. We have agreement with the FDA on all of the or most of the parameters of what will enable approval for this drug.
The phase III is a 96-week study with 103 symptomatic patients, 16 at-risk patients. It is going to involve a very comprehensive set of endpoints. The primary endpoint is a version of the CDR, the cognitive decline measurements. There are going to be multiple secondary clinical readouts, as well as multiple biomarkers, including obviously progranulin itself, neurofilament, volumetric MRI. The FDA agreed with us that neurofilament, progranulin, and volumetric MRI could be supportive biomarkers. Even if the clinical data are just trending, we think that the totality of the data would enable to get full approval. We are going for full approval with this drug because we think that the clinical readouts will be significant. This trial is going to read by the end of this year, in a few months.
Because progranulin deficiency is a risk gene for multiple neurodegenerative disorders, including Alzheimer's disease and Parkinson's disease, we are also running a phase II study, as I mentioned, in Alzheimer's disease with another progranulin-elevating drug called AL-101. This is going to be a placebo-controlled double-blinded study, 18 months long. The recruitment for this study is nearly completed, and we expect data by 2026. Both of these studies are done in very close and productive collaborations with GSK. We received, at the time when this agreement was conducted, $700 million upfront payment. We expect to receive up to $1.5 billion in milestone payments. It's a 50/50 profit share in the U.S., where we have the commercial leadership. XUS, it is royalties that sort of mimic 50% profit share. We have a really sort of significant partnership with GSK.
This will be on multiple indications: on Frontotemporal dementia, Alzheimer's disease, and eventually also Parkinson's disease. In addition to the two late-stage clinical programs, we have a portfolio of preclinical discovery programs that's relying on, at least in part, on our Alector Brain Carrier technology. As you know, proteins are large molecules. They don't enter the brain very efficiently. We and others have spent several years developing a technology that enhanced the delivery of peripherally injected proteins into the brain. The enhancement could be somewhere between 10- to 40-fold increase into the brain. The technology is using what's called transcytosis. It's basically hitchhiking on receptors that deliver nutrients to the brain. Basically, as part of this delivery of nutrients, you deliver also your drug. In this case, we are using two different transcytosis shuttles.
One is the transferrin receptor that normally transport iron to the brain. The other is CD98, which is an amino acid transport that, again, delivers amino acids to the brain. We are hitchhiking on these receptors to deliver our own drugs. I'll just show you one example of how profound the difference is with or without the technology. You see that on the left, without the technology, the antibody drugs are primarily localized sort of to the periphery of the brain. Whereas with the technology, you see very profound wide distribution of the target in the brain. Our technology is very tunable and versatile. You can do different protein configurations, and you can really adjust the technology to the specific target. That's one of the unique things in our technology.
With this technology, we started developing, as I mentioned, both more established targets and novel targets. One of the more established drug targets now is amyloid beta. As you know, there have been three approved anti-amyloid beta antibody drugs. All of these antibodies are what's called naked antibodies. They do not have any blood-brain barrier technology. Even though they enter the brain, they require a higher dose to enter the brain. Because of the way they enter the brain, they are also associated with what's called ARIA-like adverse effects, which is basically brain inflammation and microhemorrhages. Roche recently showed that if you add the blood-brain barrier technology to an anti-amyloid beta antibody, you increase the efficacy of entering the brain, and you practically eliminate the ARIA-like adverse effect. If you see here, Roche used an antibody called gantenerumab.
It has pretty high incidences of ARIA, like almost 25% of the treated patients develop these microhemorrhages and inflammation, brain inflammation. The drug actually was not clinically effective, and Roche terminated it as a standalone drug. They just added blood-brain barrier shuttle technology to the same drug, and now it was profoundly efficacious. It eliminated amyloid beta plaques within three months at the doses they used. If you see on the red box down there, there's really no ARIA events. We are building on these findings, and we are sort of developing a drug that is the best of both worlds with the plan of having like the best-in-class anti-amyloid beta antibody. We have our own anti-amyloid beta antibody that targets specific subsets of amyloid beta peptides. This is sort of the subset of amyloid beta peptide that is targeted by donanemab, the Lilly antibody.
We think it's the most effective anti-amyloid beta antibody as a naked antibody. We designed, as I said, our own Alector Brain Carrier shuttle that really, because of the unique affinity, unique binding epitope to the transferrin receptor, has minimal hematologic effects and minimal events of ARIA. Basically, we are combining all the best features of what's known for 30 years of anti-amyloid beta drug discovery into one drug. We think that, again, we could have the best-in-class anti-amyloid beta drug. This drug is targeted to be in the clinic in 2026. Another program that we are developing that uses our shuttle technology is GBA enzyme replacement therapy. GBA is a lysosomal enzyme that processes lipids. More than 10% of Parkinson's patients develop Parkinson's because they have mutations, loss-of-function mutations in this gene.
Up to 30% of Lewy Body Dementia patients develop Lewy Body Dementia because they have mutation in this gene. There is a third rare disease called Gaucher disease, and again, also caused by homozygous loss-of-function in this gene. In some cases, Gaucher disease also has neurological deficiencies. There is a pretty significant market for enzyme replacement therapy in this case. There are indications that even the sporadic forms of Parkinson's disease and Lewy Body Dementia could benefit from elevation of this enzyme because even sporadic forms of Parkinson's and Lewy Body Dementia show lower than normal level of this GBA enzyme. We spent several years optimizing an enzyme replacement therapy drug for these disorders. We engineered the enzyme. The natural enzyme is very unstable, has lower activity in the serum, and is hard to manufacture.
We spent several years engineering the enzyme to optimize activity, to optimize stability, to optimize ability to manufacture it in large quantities. We incorporated our blood-brain barrier technology. Again, the technology that we use for this enzyme is different than the technology we use for the anti-A-beta drug. We optimize all the features of the blood-brain barrier technology to the specific drug. In this case, it's an enzyme replacement therapy. We use different technology or different aspects of the technology to optimize for the drug. We also optimize the drug to have minimal immune response, minimal adverse effects, and minimal hematologic adverse effect, which is the main liability of this blood-brain barrier type of shuttles. Again, this drug is scheduled to be in the clinic in 2026.
The initial indications are going to be Parkinson's disease with the GBA mutations and possibly Gaucher disease with neurological abnormalities. A third drug that we are developing that I'll just briefly go over is a modulator of Reelin. Reelin is a very large secreted protein that probably most of you have not heard about. Recently, it generated a lot of excitement because it turned out that a single amino acid mutation in Reelin is protective against familial forms of Alzheimer's disease. As you likely know, in Colombia, there are families of Alzheimer's patients that carry the presenilin mutations. These patients, or these people, invariably develop Alzheimer's disease in their 40s. These mutations are detrimental. Basically, every individual that has the presenilin mutation develops Alzheimer's disease in their 40s or 50s.
It turned out that there are, in rare cases, individuals that are protected from Alzheimer's disease, even though they carry these little mutations. One of these protective genes turned out to be this large secreted protein, Reelin, that affects synaptic connections and also affects tau pathology. The subjects that are protected from Alzheimer's disease and carry this protective gene still have a very high pathological level of amyloid beta that is indistinguishable from other people that carry the presenilin mutation. They have a very low level of tau. The level of tau that they accumulate is not compatible with what you see in presenilin mutation carriers that do not have the protective gene. In part because they have a low level of tau, their brain function is largely normal. Alzheimer's clinical pathology can be delayed by 25 years.
We are developing a drug that really mimics and should exceed the protective variant of this gene. This could be a completely different approach to treat Alzheimer's disease. It will be likely downstream of the amyloid beta pathology. It will delink amyloid beta pathology from tau pathology. Conceptually, it could act both as a standalone therapeutic and possibly in combination with anti-amyloid beta drugs. Another drug that we are developing are brain-penetrating antibodies against tau. Tau is one of the most prominent pathologies in Alzheimer's disease, as you know. Actually, cognitive decline in Alzheimer's disease correlates much better with accumulation of tau intracellular pathology than with amyloid beta. There were several attempts to develop tau antibody drugs. Several of them failed.
Recently, there were some indications of better success, like Eisai, for example, showed in their tau antibody that binds a specific epitope on the tau protein, significant reduction in phosphotau in the CSF. We think that maybe if you use the right epitope, the right binding domain on tau, you could develop anti-tau antibodies. The anti-tau antibodies that were tested so far are naked antibodies. They do not have the ability to really enter the brain efficiently. We think that if you develop a good tau antibody with brain penetrance technology, increase the concentration of tau antibody 10-40-fold in the brain, you should have an effective drug. It could be a similar situation to the Roche anti-amyloid beta antibody, where the naked antibody was not effective, but the same antibody with shuttle technology was extremely effective.
We are developing our own proprietary tau antibody with our own proprietary shuttle technology. The idea is to bring it to the clinic sometime in 2026. In addition to antibody therapeutics and enzyme therapeutics, we are developing RNA therapeutics that are linked to our shuttle technology. As you know, siRNA and ASOs show a lot of promise. The issue with these technologies is delivery. You have to inject these drugs intrathecally. It's very inconvenient. It's somewhat risky. Most clinical centers are not prepared to do this intrathecal injection. We think that combining RNA drugs with our blood-brain barrier technology, which will enable peripheral delivery of RNA drugs, could be extremely useful. We have multiple programs that integrate siRNA technology with our shuttle technology. One of them is tau. We have at least three additional programs that are ongoing.
We think that if we are able to consistently link our blood-brain barrier technology with siRNA technology, it could really transform the field. It will make the drug a lot more accessible to patients with, again, lower dosing and hopefully better safety that is associated with safe delivery. Just to finish, Alector is really a broad-based neuroscience-focused company. We are completely committed to treating neurodegenerative diseases. Neurodegeneration is still the largest unmet medical need now. There are really no meaningful or good disease-modifying drugs for the large neurodegenerative disorders. We are using both sort of human genetics, our expertise in antibody and protein engineering, our expertise in blood-brain barrier shuttle to really develop multiple novel, first-in-class and best-in-class therapeutics. We have two late-stage clinical programs that will read this year and next year.
We have an exciting portfolio of discovery programs that will keep entering the clinic starting in 2026. We see a lot of de-risking in our portfolio now because of the diversification of enzymes, antibodies, and siRNA , established targets and novel targets, integration of late-stage and early-stage programs. We see a lot of potential for the company in the next two years. We are well-resourced to do this. We have over $400 million in cash to do this work. We have very strong partnerships with GSK that could deliver significant milestones. The first commercial sales, for example, for progranulin in the U.S. will be a $160 million milestone. We think we are in a sort of very good place to take off in the next two years. Thank you again for the participation.