Good morning, everyone. Thank you for joining us on day two of the Goldman Sachs Healthcare Conference. It's my pleasure to introduce the Annexon team. With us, we have Doug Love, Chief Executive Officer and President, and Lloyd Clark, SVP, Ophthalmology Strategy. Thanks so much for being here. To start here, perhaps a snapshot of how to think about the second half of 2026 and beyond. This is a potentially transformational year for the company with pivotal data in geographic atrophy that is expected in the fourth quarter of this year. Describe, maybe to start here, your asset, how it's differentiated from the other geographic atrophy assets, and your confidence in the phase III study success?
Yeah, happy to do so. Thanks again for having us. It's delightful to be out here in Miami with you all. Look, we're really excited about the phase III asset vonaprument for the treatment of geographic atrophy. I would say it's differentiated from the first-generation assets in three principal ways. First and foremost, recognizing that GA is a neurodegenerative disease, we're targeting exactly that, providing a neuroprotective approach to preserve vision with vonaprument in this disease, which is very different from the prior drugs that are approved targeting a surrogate biomarker for vision. Secondly, the drug candidate itself is quite differentiated. This is a small antibody Fab fragment. It's 50 kDa, no PEGylation, with really low viscosity. The ease of administration is really important for us. Excuse me.
Importantly, it's a really small microliter, 25 microliters, which is about a quarter of the size of the currently approved therapies. What that means is when you administer the drug, you don't experience the floaters or temporary blindness that you do with these drugs with higher concentrations that result in ocular pressure. Really excited by that. Finally, we're really excited about the data we've demonstrated already in the phase II, which we're looking to replicate with the phase III. vonaprument is the only program to demonstrate significant preservation of the photoreceptor retina neurons that are responsible for visual acuity. It had an even more pronounced impact in the central macula of the eye, which is principally responsible for the vision loss in geographic atrophy, that translated to significant preservation of vision on all of the measurements in our phase II study.
Importantly, best-corrected visual acuity, 15-letter loss, which is the gold standard. A really differentiated outlook from the prior therapies, and we're excited about where we are in the phase III program.
Maybe to jump a little deeper here into the phase II data. With regard to what we saw, the study did not meet the primary endpoint of GA lesion growth, but showed vision preservation for BCVA, as you mentioned. How do we reconcile the benefit on vision preservation with the lack of impact on anatomical markers?
Yeah, really good question. First and foremost, we did have an impact on the anatomical markers, photoreceptor neurons, which is, again, the structure in the eye that is responsible for vision. As you alluded to, did not have a significant impact on the RPE cells or lesion growth. The reason for that is it's now known you lose photoreceptors prior to your RPE cells, that is what we're targeting principally. Maybe I'll invite Lloyd to talk about all of that.
As Doug said, we know from our work as well as other groups that photoreceptors are lost first in dry AMD with geographic atrophy. RPE atrophy is a lagging indicator of disease activity. It's critical to protect photoreceptors first, and that's another key differentiator of our drug as a C1q inhibitor. C1q is known to localize on photoreceptors that are lost in geographic atrophy. By inhibiting the function of C1q, we protect photoreceptors first, which then protects RPE cells down the line. From our data in the phase II, we did not show a statistically significant benefit in RPE lesion growth, but we saw a 10.5% reduction in the final six months of our phase II program. We expect to see further protection of RPE in our phase III program out to two years as we protect photoreceptors first, which then leads to protection of RPE cells later.
How do you address the elevated BCVA 15-letter loss in the sham arm? What's playing out in the fellow eye data between the treated and sham arms in that context?
You're talking about our sham event rate in the phase II, right? The data that we've pulled forward as our definition with confirmed 15-letter loss at two visits. That number in our phase II was 16.9%. It's very comparable to other studies in the medical literature. Probably the best comparator for our program is the lampalizumab natural history cohort, which is somewhere between 12% and 14% at a year. These are very similar numbers. We've done a good bit of internal analysis of this data to feel very, very comfortable with where we are with our sham event rates. We're comfortable with that number and understand that our study really was recruited for a functional outcome.
That's the other important difference between our study and really all the others that have been evaluating patients with geographic atrophy, is that their specific patient population was to study RPE lesion growth. There's specifics to our characteristics as well as our understanding of our data that demonstrates that we're recruiting to a functional outcome. In terms of our fellow eye analysis, the fellow eye studies are difficult because the baseline characteristics are not balanced between treatment groups. We're essentially an all-comers analysis in the fellow eye group. It's not surprising that we see some differences both in the sham event rate as well as the treatment event rate. It's important to emphasize that we saw directional benefit with vonaprument in the fellow eye analysis, as well as a dose-dependent benefit, the every other month doing well, the monthly group doing better.
Consistent with what we saw in a much more controlled group in the study eye.
I guess the reason we put out the fellow eye data, to Lloyd's point, is a sensitivity analysis. As you see in our data, we put out all of the data related to vision preservation, 10- letter, 15- letter, 20- letter. Fellow eye is another sensitivity analysis, as Lloyd said. Dose-dependent and certainly a pronounced effect, 57% versus the fellow eye. The eyes are not matched at baseline because you can't do that in these studies, and that's why these studies have not been recognized for approval.
Maybe looking forward to the phase III here. Frame for us your expectations for that data set in the fourth quarter, including the sham arm and what your view would be on a favorable outcome here?
Yeah, maybe I'll start, Lloyd, and then get you in on the sham arm. A favorable outcome is statistical significance on BCVA 15- letter loss. Again, it's the gold standard. Represents about 50% of your vision loss over whatever period of time in which you are studying it, and there's just been no false positives at this point. It's an exceedingly high bar. We're really encouraged by that. Any statistical significant demonstration on BCVA 15- letter in talking to the regulators as well as the physician community is deemed clinically relevant and sufficient for an approval with regards to what we're seeing.
Yeah, in terms of the performance of the groups, I think is to your question. Again, we've informed our expectations with the trial with a number of data points, but we lean very heavily on the data that we have collected in the phase II study because we have a number of parameters that we've evaluated to have a good understanding and an expectation for what a sham event rate should be in this specific population, which is different than other clinical trials. We feel very good about those estimates as we move forward towards the data read.
It's really an important point because I think what we're seeing is folks are trying to compare sham rates from study- to- study without really understanding, one, the objective of the studies. Are they the same? Two, at a patient level, are you really clear on what are the key factors with regards to each patient characteristic? Whether it's lesion size, location, baseline visual acuity. What do each of those factors contribute to a patient actually losing vision at a prescribed period of time? We have the only data set in geographic atrophy where we can look at that deeply on a per-patient basis, and that's what we use to power the phase III study. This comparison from one study to the other in sham rates, in absolute terms, really difficult to do, even more so in a neurodegenerative disease. It's rarely done.
Given geographic atrophy is initially fovea-sparing, how confident are you that this BCVA endpoint is achievable in the context of this disease, just given what we've seen with the other two drugs?
Our enrichment strategy and making sure we're identifying patients who are losing vision but not so far gone that you can't protect vision is very important, which gives us a great deal of confidence. We were able to do it in the phase II. We expect we'll do it in the phase III, we'll elaborate on that.
It boils down to patient selection. There's really three phases of disease in geographic atrophy. Early disease, there's several years of progression where patients lose no vision. Then towards the end of disease, once patients develop large subfoveal lesions, they've lost all the vision that they're going to have. Our inclusion criteria are designed specifically to pick those patients in this middle phase of the disease where they have rapid vision loss. We know that our drug is beneficial to all patients with geographic atrophy and dry AMD because it protects photoreceptors. From a regulatory perspective and from the perspective of designing a trial for approval, it's critical to pick that specific group of patients to evaluate.
How likely is it is statistical significant benefit on GA lesion growth rate reduction at the 18 month- 24 month time point? If you don't achieve that, how do we reconcile the vision benefit with the long-term risk of a lesion growing into the fovea?
Good question. I'll start. Lloyd, you can please dive in. First, we think it's quite likely. Well, maybe even before, let me just back up on RPE and lesion growth. It's just really a debunked hypothesis, and I just need to say it that plainly. There is zero data, preclinically or clinically, that protecting RPE lesion growth translates to vision. As a result, Europe has not required us to study that as an endpoint, nor has the FDA. We're looking at it as an exploratory endpoint in our study. Scientifically, there's just not a wealth of information that supports that as a viable endpoint. Be that as it may, we are studying it as an exploratory endpoint because we continue to get the question, and we just want to take it off the table.
As Lloyd alluded to, if you look in the second six months of our study, in the ARCHER study, what we showed is that we protected against lesion growth at a rate more than 3x greater than in the first half of the study. The reason we're doing that is C1q localizes on photoreceptors. We're protecting and strengthening the retina neuron, which then over time strengthens the RPE cells that provide trophic support for the neuron. We're quite confident we'll do that, and I don't know if you want to add.
Nothing to add. Yeah.
Mechanistically, how much data is there or is literature to support this neuroprotective dynamic that's playing out with C1q?
Yeah. Great question.
It's clear there's loads and loads of basic science evidence to support the idea that C1q localizes on neuronal synapses for removal. That occurs in the brain, it occurs in the retina, it occurs in the peripheral nervous system. That is well established across multiple different neurodegenerative disease states. This idea is universal, and if you consider this drug as a neurodegenerative disease state. The mechanism of action is well worked out. The other thing we know is that in the aging retina, C1q is upregulated almost 200 x above normal levels, and it localizes on damaged photoreceptors in a light animal model. We know that it's there, and we also know that when it is inhibited with a C1q knockout model, then the retinal function improves as well as retinal anatomy does.
We have both preclinical as well as animal evidence to suggest that this is absolutely a viable mechanism and central for protecting neurons as well as photoreceptors specifically.
I'm glad you referenced the preclinical data, Lloyd. We invite folks to go in and look at the package. Different again from the RPE story. We actually demonstrated preclinically what we demonstrated clinically, that is C1q localizing on the photoreceptors and stopping the damage or loss of these photoreceptors and protected their function. We measured all of that before going into the phase II study, which is why we pre-specified BCVA 15-letter as a key secondary endpoint.
What are your thoughts just long term on immunosuppression or just overall safety in the context of targeting upstream?
Right.
In the complement cascade?
Well, specifically with our drug, I'd say in terms of safety, this drug is very similar to all of the other small fragment biologics that have been used in retina. I'm still a part-time practicing retina specialist, so I have 20 years of experience in development of these drugs as well as using them. Our drug has all the same characteristics of the important drugs in the exudative space. From a safety profile standpoint, we feel really good about that. In terms of the systemic risk associated with our drug, it's important to understand because it is a small fragment antibody, and it's delivered in the eye, you're giving minute concentrations of the drug in the eye in terms of a systemic concentration. Once that drug leaves the eye, it's metabolized almost immediately.
The take home is you can't identify any vonaprument systemically in our patients in the phase II.
On a regulatory standpoint, the phase III trial has been designed to be evaluated as two independent sub-studies. Speak to your confidence in the powering of these individual sub-studies?
Yeah. First, maybe just to clarify the regulatory status. Single pivotal study is all that's required for approval in Europe with EMA. With the U.S., we have a single protocol, two sub-studies, as you alluded to, overpowered at high phase III, greater than 90% at the sub-study level. I don't know if you want to add anything to that.
No, we're well aligned with FDA in terms of our two sub-study approach. In fact, it was really their idea when we were in the trial design period prior to the initiation of the ARCHER II. We have a pre-specified plan where we'll split at the site level to identify two very similar patient populations, which should increase our [PDA.
Perhaps jumping over to the commercial opportunity here. Maybe frame how you view the opportunity today. We have two players that have pretty much divided the market here. How do you plan to, A, integrate into that market, B, lead the medical education effort to shift the narrative towards vision preservation from lesion growth? Which, to be honest, I think the doctors understand vision preservation more, but I'm just curious how you're thinking about this?
Well, exactly how you said. Vision is what matters. It's very clear to us. We've done extensive research with the physician community, the patient community, as well as the payers who are questioning now on some level continuing to pay for these RPE preservation-type drugs that after a year, you're losing 50% of your patients. The dropout rate is really quite enormous. We expect to displace them altogether with a vision-preserving therapy. We're excited by that. We anticipate we will get the switchers. We will bring new patients into the fold. We know only about 20%, 25% of GA patients are currently getting therapy. The vast majority are on the sidelines. With the opportunity to preserve their vision, they're going to come in.
When you look at our data, which is what you want to see with a neuroprotective approach, patients who are earlier in the disease process, zero out of 56 lost their vision in our study. We have an opportunity to capture patients earlier in their disease. With the new imaging techniques like EZ OCT, where you can assess damage to your photoreceptors earlier, even before you have lost significant vision, we really think we are going to open this market up and it is a real opportunity for us.
Yeah. One other comment. Physician activation is key in this space. This is still in many ways considered maybe not an optional therapy, but one that clearly patients and their physicians have to consider. Only 20% of the retina specialists in the U.S. are currently participating in the GA market. There is a number of reasons for that, but I think the efficacy safety balance is a very important piece there. I think with a drug that demonstrates functional benefit, I think physician activation will be increased, and that will be key to utilization. The market is significantly underdeveloped.
One other just quick thing is sometimes we get questions on durability of our treatment effect and whether or not that will be lasting. What we saw in our study is that the protection against vision loss was increasing over the 12-month period of time. If you look again at the second six months, not only on the RPE and on the photoreceptors, but also on vision preservation, really a pronounced growth. When we stopped the drug, we saw that vision began to return. Our drug's having a disease-modifying effect, and that's why we built our study with this off-treatment period where we could follow the patients. We expect that we are going to convert patients early, both new patients and switchers, and grow the market, and we expect we will keep them over the course of their lives.
Just to go back to a statement you made about 20%-25% of the market's penetrated and only 20% of the doctors are actually prescribing. Do you feel that over time with the existing drugs, they have gotten more comfortable with the safety profile in the context of efficacy? I guess I'm just trying to understand.
The headwinds. I think the headwinds have differed depending on the time, right? I think that the initial launch of the first-generation therapies was quite brisk, actually, very successful. I think the safety headwinds were significant post-launch, and that really blunted market development and growth. From there, to me, I think there's a fair amount of fatigue based both on the physician side as well as on the patient side, because they're not seeing, they're not experiencing a functional benefit. I think the market is fairly stagnant, and it's kind of the way it feels and the way it's going to be until there's a breakthrough therapy that demonstrates more of a benefit than an anatomic benefit alone.
How do you think about the competitive landscape here in terms of drugs in development? There's a systemic C5 drug from Regeneron, among others.
Yeah, for me, and voice your way in, I'm confused by the follow-on approaches in development because you're still targeting this RPE lesion growth story, and one, you've just said to yourself, you're throwing away the E.U. market, you're not going to get an approval, and how are you going to penetrate in the U.S. market? Because physicians and patients aren't going to continue to use those drugs if you don't demonstrate vision. At a macro level, it's just a little confusing, that development strategy. I don't know what you think.
I agree. The other issue with systemic complement inhibitors is to your question earlier, the issue of risk in an otherwise healthy but elderly population. It introduces a significant amount of systemic risk. Is there really going to be any benefit over the currently available complement inhibitors that you can deliver in high concentration to the eye? I think that that's a difficult program in particular to have a lot of confidence in.
Speak to the commercial strategy here in terms of whether you'll go at it alone or look to a partner?
We like it. We're going to go at it alone. It's a super efficient commercial footprint. About 3,000 retina doctors in the U.S., a couple of large practices control roughly 50% of the prescriptions there's a well-worn template for smaller biotechs to come into these spaces and commercialize them. We are appreciative of the first generation that's done a lot to make the market already, we just feel like this is a highly differentiated asset on safety, on efficacy, and on route of administration. We're looking forward to getting after it ourselves.
Perfect. Switching over to your drug, tanruprubart, for the development of Guillain-Barré syndrome. Describe the development path here and where you stand with regard to regulatory approvals, remind us of the key features of the phase III data set that drive your confidence here?
We're really excited about this asset. Really the first clinical demonstration of blocking upstream classical complement in a neuroprotective way in Guillain-Barré syndrome. In our phase III study, what we saw is roughly 90% of patients benefited by week one, which translated to a 2.5x greater likelihood of improvement by week eight, which was the primary endpoint, and a 2.5x greater likelihood of being normal by month six, which are whopping effects in this disease that has not been studied in more than 40 years by anyone. It's the first randomized study program. We're really encouraged by that. We ran this program ex-U.S. because it was deemed unethical to run placebo-controlled studies here in the U.S. We run controlled studies. We don't rely on natural history, whether it's a rare disease or not. We're really fundamental in that regard.
We ran these in Southeast Asia with alignment of the regulators, both in Europe and the U.S., on two fronts. One, we needed to demonstrate substantial evidence of effectiveness as well as, secondly, generalizability of the patients in our study with patients in the West. Clearly have satisfied the first box. We're really pleased by that. We also feel like we've satisfied the second box. We did a lot of work to establish that the patients in our study are comparable to the patients in the U.S. Did a propensity score matching of the patients with patients in the West and measured their outcomes versus placebo as well as against IVIG, which is the standard of care. We are now on file in Europe for approval.
We're on pace for an approval early part of 2027, so we're really encouraged by that, and we anticipate filing shortly in the U.S. The U.S. asked for additional information on patients here in the U.S. and Europe, just to really satisfy themselves, I guess, cross every T, if you will, dot every I to ensure themselves that the patients were comparable. We initiated an open-label study here called the FORGE study. The FORGE study is really designed to provide experience with our drug in the U.S. and Europe, as well as provide additional information to the regulators should it be a topic. Really encouraged by that. We will release data probably later this summer on the FORGE study. It really shows the impact of tanruprubart in the West, which is quite similar to what we've seen in the phase III study.
Just going back to the phase III studies. They were conducted in Bangladesh and the Philippines to speak to the translatability of this data to the U.S. and European patients?
Yeah, the most important part is GBS is GBS. GBS is an antibody-mediated disease. A preceding infection drives it. It's the same all over the world, and that's been widely studied. We have every KOL in the globe working with us on this program, which we're really encouraged about. Really important that the disease presents and plays out similarly across the board. Secondly, with regard to the patient populations, it really is the same. It doesn't matter. You have an antibody-mediated attack, and the question is whether you can stop that attack soon enough to show protection to your peripheral nerves and recovery therefrom. We've seen that now, as I said, not only in our phase III study, in the FORGE study, as well as the propensity score, real-world evidence work that we've done. We're really confident in that.
In the context of the FORGE study that's required here, what is the regulatory risk that's left around that trial itself?
Until we go back to the regulators, we don't know. What I can say is we're really, really pleased with the consistency of the data that we're seeing in the FORGE study with what we're seeing in the phase III study, and that's in three regards. One, the PK/PD profile. If they were different profiles, that would be an area for concern. We don't see that. If there were differences in safety outcomes, we would be concerned. It's important to know this is a single infusion. Our safety profile is really akin to placebo, so really, really important. I alluded to some of the efficacy outcomes that we're seeing really rapid benefit that's durable over time. We're not really seeing anything that's different between the patient populations. We didn't expect to, because GBS is GBS wherever you are in the world.
Can you speak to the commercialization dynamic here? This would be one where you would partner ex-U.S., I believe-
Right.
-take it forward yourself in the U.S.?
Absolutely. It's a rare disease, and it's just really not our bailiwick to partner it or to commercialize it in Europe. We will either do that in the ex-U.S. partnership or in some type of distribution type of an agreement. In the U.S., however, a very efficient footprint. GBS is a population-based disease, so there are about 50 or so healthcare centers that see more than 50% of the patients year-over-year for seven years. That's a very targeted footprint. What's key is, this is a hospital-based disease, so you need to be on formulary, you need to be reimbursed, and you need a large field force. You need MSL and you need field managed care. We're well underway in that process here in the U.S. We're encouraged and we're really excited.
The other thing I'll just say is it's a really significant market opportunity. There are 8,000 patients a year that get GBS, and about 95% of those patients are being treated currently with standard care IVIG, even though it's unapproved and its treatment effects are middling. What that means is you have a ready-made market. We have an approved therapy, particularly when you look at the outcomes in our study. We're excited to really make hay with this in the commercial space.
You do also have a pipeline behind these two programs, how do we think about ANX1502 and when we could get proof of concept from that oral small molecule?
Yeah, we like it. It's coming. This is the first small molecule in the classical complement space, really designed to target activated form of C1s, which is a target that's been clinically validated by multiple antibody approaches in diseases like myasthenia gravis, et cetera. Our thought is that if we can provide an oral therapy, we really have an opportunity to capture a market where about 70% of the patients are currently on oral. We really like this from that perspective. We're in a small proof of concept study, really a translational stage study, to show that we can effectively engage this activated complement and normalize it, as well as looking at disease markers like bilirubin, et cetera, in a very objective fashion to see if we can normalize that as well. We anticipate data this year, second half of this year, before the GA data.
How would it be differentiated versus the other complement targeting drugs in myasthenia gravis, for instance?
Importantly, C1s, as I said, has been validated. It'll be similar in that regard. Could be perhaps a little better, but we will hold that back until we see the actual data. The big differentiation is ease of administration, though. These patients are really in significant conditions, and so the ability to take an oral at home is a game changer in this space, in our view.
Speak to your cash position and given the current set of programs that are advancing, do you foresee the need for additional funding as you look to commercialization?
We reported $225 million on the books at our last earnings, which gives us runway well into the second half of 2027. Through all of the key catalysts. That includes the GBS filings and approval. That includes ANX1502 proof of concept and importantly, the phase III readout on geographic atrophy. We are really comfortable from that perspective. That being said, we're engaged in a lot of non-dilutive efforts. We do have all of these assets are wholly owned. We're not commercializing GBS, for example, outside of the U.S. We'll look to do some things there to kind of beef up our balance sheet in the not-too-distant future.
Great. Maybe as a last question here, anything else that you want to highlight about the company's strategy and as you look to these big data reads that are all?
Listen, we're excited. We call this a win season for us. We've been at it now for 11.5 years after we brought this technology out of Stanford University, we're encouraged, more encouraged than ever, that by stopping inflammation right where it starts on diseased tissue. We're seeing differentiated outcomes than downstream approaches in all the diseases that we've been in. Folks talk about GA and upstream versus downstream, but look at GBS. Alexion ran a phase II and a phase III in GBS. Our outcomes are dramatically different. We're seeing it in GA. For us, this is a period of execution. We're really sharply focused on executing. Coupled with that, doing a bit more, actually a bunch more on the education front, making sure that people understand this is a novel approach. All complement's not the same.
We're looking to return people's lives by really providing function depending upon the disease in which we're pursuing. It's an exciting time for the company. We appreciate being able to talk about it here.
Great. Well, thank you so much. Pleasure.
Thank you all.
Take care.
Appreciate it.