Everybody, good afternoon. I'm Seamus Fernandez. I'm one of the biopharma analysts here at Guggenheim Securities, and this is our SMID-cap biotech conference . Really pleased to be joined by, actually, my best idea, Apogee Therapeutics, and we have actually, I think, the majority of the C-suite here. So to my immediate left is Michael Henderson. To his left is Carl Dambkowski. To Carl's left is Jane Pritchett Henderson. And to Jane's left is Jeff Hartness, in order, Chief Executive Officer, Chief Medical Officer, Chief Financial Officer, Chief Commercial Officer. So that kind of runs the gamut there, but obviously, we're excited about the opportunity for Apogee, no question about it, but maybe you can just, Michael, set the groundwork for the Apogee opportunity, the vision, and really what's exciting about the Th2 market as well.
Yeah, no, happy to. And we're excited this year to live up to the best idea mantle. It is kind of like the year for us. We've been working for it for quite a while. The kind of company got started about five years ago was in the South for quite a while, with the idea that when you look across inflammation immunology, especially kind of type 2-driven inflammation, things like atopic dermatitis, asthma, COPD, et cetera, there are finally validated targets, IL-13, IL-4 receptor alpha, TSLP. But those targets are actually inhibited by pretty old antibodies. So we saw the potential to bring the best of antibody engineering, including improved backbones, improved formulation, improved half-life, while maintaining those proven targets and just create best-in-class drugs.
So our platform has been in our first two drugs which have read out improved formulation, improved backbones, three to five times the half-life of the original kind of predecessor antibodies, like lebrikizumab and Dupixent. And this year, we're reading out our first efficacy data in patients. So in the atopic derm market, there's currently an every two and an every four-week dose drug. We're going to be reading out data mid-year, which we believe could prove out our potential to come with a best-in-class drug for the 30 million patients that have moderate to severe atopic derm in the major markets.
Great. And then in terms of the competitive edge, outside of just duration, you've got a potential competitive edge on combination, but also, I think, a bit of a different strategy because there are other combination opportunities out there with bispecifics. So maybe you can just kind of offer a little bit of a trade-off of the Apogee strategy there versus the sort of direct combination strategy.
Yeah. So a few years ago, when we took a hard look and realized that where the leaders in are going, right, the AbbVie, the J&Js, it is towards fixed dose combinations. J&J is doing an IBD and RA with readouts this year. AbbVie's recently launched a big study in IBD. And this is where all the obesity players are going now as well with different readouts. And it's because not a single pathway will cure these kinds of inflammatory patients. There's a few different pathways. So we thought, OK, how can we best inhibit and create a patient-focused solution that gets at two pathways at once? And you really have two options. You can do two best-in-class mono therapies, co-formulated together. We make sure that we design our antibodies to be co-formulatable so that they can happily exist together. Or you can do a bispecific.
I think bispecifics, they sound really exciting, but historically, they just haven't proven themselves out near as much as fixed dose combinations, and I think their drawbacks are a few-fold. One, you're bringing, you're mixing agonism with antagonism. You don't want to bring in IL-13 in the proximity with TSLP. That agonizes the pathway. Two, you don't want one-to-one inhibition. Some of these targets have an exposure response. Some don't. So you want to titrate.
And third, and I think this is important, patients don't want to go backwards in dosing. And when you think about the ability to get to three or six-month dosing, you can do that with our antibodies, we believe. You can't do that with a bispecific. It has not been shown that you can extend the duration of a bispecific like that. And add on high ADA rates, harder to manufacture. It was just clear that the path to go was with a co-formulation.
Yeah. And so basically talking about a purpose-built strategy that's disease-specific and also kind of targets the inflammation in an enhanced way over time. So a couple of the sort of simple controversies that are out there are, one, is just the cost of development associated with that. Maybe you can just sort of give us your view on not just the cost of development, but there's also cost of manufacturing that maybe plays into some of the decisions that Apogee has made.
Yeah. Jane, do you want to speak too?
Sure. When we look at the opportunity to combine, we're going to do that in phase II trials. So when we look at the increase in cost, it's not going to be double. There'll be a nominal increase in the size of the trial and the material that we have to provide. But the phase III trial will be the same. And from a cost point of view, ultimately, when approved, COGS is going to be lower on a co-formulation than a bispecific, for example. So we don't see that barrier of a much higher cost to bring that to commercialization.
Great. And maybe kind of bringing us back to the bispecific and the duration, can a bispecific, is it possible to actually have a bispecific achieve a much longer duration or a duration that you can with a single antibody? Are there advances being made there from your perspective, or are the limitations fairly obvious?
Yeah. I think that it has not been proven that you can. I think that you, right, YTE or LS, other half-life extension technology, has been applied in the clinic and works on monospecific antibodies. When you look at bispecifics, there are very few examples where it has been applied, half-life extension has been tried. Xencor has tried it a few times, albeit for oncology antibodies.
And they did not get a significant half-life extension. Could someone do it? Could advances be made? Undoubtedly, right? Someone will probably crack that nut at some point. Whether or not they're going to do it in the next five years, we'll find out. But they will not be able to get to every six-month dosing is our view. I think that you really do see a shorter half-life on average with bispecifics than you do with monospecifics. And also, just to keep in mind, we're years ahead.
Yeah. Now, let's dive into the sort of expertise that comes into building your individual antibodies. There's a lot of questions around antibodies that are attempting to come to market from China. There's this view that there's a fire sale going on and that anybody can do this. Maybe just help us understand from your own data why you don't think just anybody can do this.
Yeah. So if you look back in the literature, at some point, MedImmune, they put a YTE on an IL-13 antibody. They did it about five to 10 years ago. That phase I data exists out there. It did not get an extended half-life. It had incredibly high ADAs. And it's because they had finally matured something, and it crashed out. When you look at kind of what we've done, and even in our IP, we've shown, look, people tried this. It was not obvious how to make it better. We spent years preclinically going through all the experiments, head-to-head data, including in non-human primates, and ended up making a much better antibody. We do that with each of our programs. And I think when you look at kind of our initial data, right, we're at 77-day half-life versus lebrikizumab, 25 days.
We're at 180 mg/mL with similar viscosity to lebrikizumab, which capped out at 125 mg/mL. For 990, we'll have data in the first half of this year. For 808, we read out data towards the end of last year showing similar improvements. So I think we have spent the time. We've always made the story sound simple, which in hindsight, we've almost made it sound so simple that people think anybody can do it. We are in the lead. We've raised a significant amount of capital to continue going as quickly as we can and execute so that we are further building that lead. And I will just say too that when you look at all the fire sale, the innovation out of China, I think that all that innovation, one, none of it should have come as a surprise.
There were public disclosures of all those assets for at least the last two to four years. Many of the, we look confidentially at a lot of those assets. But all of the assets that have been funded and spun out or acquired by pharma, those were all on their pipeline pages or with IP. Totally get that investors are short on time and don't have the ability to actively monitor the China scene. But none of that was shocking. I think what was shocking was the market reaction, but it's just a pendulum. It'll swing back, and then two years from now, something else will happen, and it'll swing back the other way. What we know and believe is that nobody has our pipeline. You can't replicate that. And we are about to have phase II data and are years ahead, and we'll continue to build that lead.
Great. So Carl, I'm going to turn to you for the question around phase II data. Obviously, we've seen a lot of variability in atopic dermatitis clinical trials, particularly as it relates to the placebo response. And also, there are different endpoints that investors tend to focus on, right? There's the EASI-75. There's the EASI average, sort of the mean EASI score reduction. But then there's IGA 0/1. Maybe you can just start with, OK, what is Apogee doing to maximize the likelihood of success in your phase II study?
Yeah. No, thanks. We're excited. Our Guggenheim press release earlier this week, we finished enrolling part A of the study, over-enrolled it by a little over 10% to 123 patients, finished enrolling in that study, and then we started part B of the study too, less than a week between those two, so we're really trying to be operationally seamless as we go from phase II- A to phase II- B. In terms of what we've done in the trial, I think we've thought from the beginning really rigorously about how to make sure we optimize for a probability of success and a really good readout. I think we've thought about it across four different dimensions. One is country selection, make sure we have a good mix of countries.
Two is site selection, making sure we're extremely rigorous about the sites we include, regardless of where they are in terms of countries, to really get specialist sites that can produce really good data. Third is protocol design and IE criteria, and being really stringent about what we call the right patients. So these are moderate to severe AD patients that are most likely to benefit from treatment.
And then finally, I think it is, I'll just say, a lot of oversight and scrutiny of sites, including everything from how we take photographs at baseline of every patient enrolled in a study, limiting the number of patients that are enrolled at every site too so we don't have kind of one outlier site swinging things one way or the other. I guess you could also just call that our big brother site. We are, if nothing, on top of these sites and making sure that they're aligned with us in the way that we want this trial to look.
Great. That's super helpful. And in terms of just the monitoring of the study, I know that's been something that's called out by a number of companies and investigators in this space. I guess if you can answer it, is there a frequency of sort of problematic patients that are offered, where you have a 10% rate of sort of patients that have a baseline photograph, and you say, nope, I don't even think that's atopic dermatitis? Is that something that happens very frequently?
Yeah. I think that one, for us, it's about partnerships with the sites really early on to make sure that we're aligned with them. And then I think that things always come up during conduct of the study, whether it's photographs or data entry or things along the way that we're constantly having to problem solve. For us, again, it's all about oversight and early relationship building with the sites. So the leads of that study, we have two board-certified dermatologists leading the study. So they have not only the expertise and knowledge to have the correct oversight, but can have the right discussions with dermatologists as well on it.
And then about 25% of the company is for our ClinOps team, which is partnering with the sites on data integrity and operational management too. We're not kind of letting the CRO and the sites just go for it and do it themselves, right? We are heavily involved every step of the way to make sure that those things come up before they're actually enrolled and can be problem solved or the correct thing can happen with them.
Great. So let's talk about the endpoints and sort of the endpoints that we should be thinking about at the 16-week evaluation and sort of those head-to-head comparisons, mean EASI, or sorry, I think it's mean EASI, sorry.
Yeah, percent change from baseline is easy.
Yeah. And then EASI-75, EASI-90, and IGA 0/1. Again, my personal view, I have sort of a strong view on this, is that IGA 0/1 is really the best predictor of a successful phase III clinical trial, but it may not sort of satisfy Wall Street metrics. So how would you have us think about that?
Yeah. I'll start, and then Carl, welcome you to weigh in further. I think this also ties into a bit to the recent placebo kind of curve balls that have been happening. I think percent change from baseline and EASI-75, they have the most noise, right? They're the weakest metrics. I think EASI-75 is where a lot of people look. So I think those have the most noise.
Still, historically, if you run a trial with the IE criteria that we have, it's very manageable noise, and I think that you can compare well kind of between trials. To your point, you see less noise and lower placebo rates in IGA 0/1, EASI-90, and EASI-100. We are measuring all of those, and we'll look to release data on all of those. We think that within those, you will be able to very clearly look at our drug and compare how we're looking to both Dupixent and Ebglyss.
Great, and if you were to sort of, you've optimized your study and your dosing to kind of maximize the dose-exposure relationship, but maybe bring us back to why you think the dose-exposure relationship is important.
Yeah. I mean, what we've learned, and I think this is a recent learning in the last couple of years, right, and really less than that, actually, probably the last 12 months or so from IL-13 and how lebrikizumab and APG777 target IL-13 specifically is that there might still be efficacy on the table with this target. And that really comes from three sources of data from lebrikizumab. One is their phase II-B, which showed a really nice dose-response relationship, didn't plateau the response, but no dose AE or exposure AE relationship. Second is from their EMA approval. They showed that the lowest body weight group that had about 30% greater exposures than the average patient in the study had about 10 percentage points better efficacy across all key endpoints, including more stringent ones like IGA 0/1 and EASI-90.
And then the third is they had the parameters for an exposure response model in both the FDA and EMA approvals that you can recreate, also suggest that these higher exposures could lead to better efficacy. So we're testing that with a regimen for the part A readout, which tests 30%-40% greater exposures. It's about half the injections in the induction period so that we can make sure as we look at maximizing 777 success that we can make sure that we know at the end of the study that we have maximized the response and clinical benefit we can get for patients.
Got it. Jeff, one thing that investors sort of say to us is, well, you absolutely have to differentiate on efficacy for Apogee to be worth what it is today even versus even to have upside. How do you sort of react to that statement?
Yeah. I would say that this is a market that's heading toward $50 billion a year, the biologic AD market. For us to come in and have equal efficacy to Dupixent and Ebglyss with every three or six-month dosing, I would say that that is incredibly disruptive and transformative for the market itself. Everyone we speak to, physicians, patients, all market research shows that without question, when they can choose between what's available and 777 with just equal efficacy, they choose 777, as I think we would all agree.
I think the other piece, and importantly, is how the payers see it and is it going to be covered and paid for? and without question, it comes back the same that with equal efficacy and safety and every three-month dosing, this is a first-line biologic product with equal access to Dupixent. So I would say that the market opportunity with equal efficacy positions us really well to take share early and have sustained success. But obviously, to Carl's point, we have three different shots for better efficacy, which transforms the entire market.
If you were to kind of argue from your payer research, what's the most important endpoint at the end of the day to separate on? Is it 90, 100? I mean, this is kind of where we've really seen the IL-23s and 17s start to kind of differentiate from each other, at least in psoriasis. So how do the payers sort of respond to that separate from the sort of longer duration opportunity?
I think that they're looking more at the majority of the patients. So you have a higher percentage that we're looking at in AD as EASI-75. So if we are equal to the EASI-75 numbers, that positions us well for that first-line biologic use. I think secondarily to that, you could have equal 75, but you could have more depth into the EASI-90 that is a further differentiation on the efficacy side aside from just the transformative difference in dosing. For the payer, table stakes is sort of OK, match up with the existing therapies on EASI-75, and then your depth of response could actually drive incremental differentiation.
That's exactly right.
And I think that people here, and investors too, they take observations from psoriasis and other catalysts that they're following there where, right, people are testing more frequent things that need higher efficacy to get access. And they apply those same lessons to us. And that is just unfounded. There are no biosimilars in this market. We're launching well ahead of biosimilars. We're launching into a market that only has an every two-week drug and an every four-week drug. We're launching into a market where LEO, which is not a powerhouse, has access across the Board for Adbry, which is inferior in every way to Dupixent. Access is not an issue in atopic derm because there's so little competition and there is nothing else on the horizon. So I get the, oh, payers don't pay for convenience.
Payers want competition in a world where you just have an every two-to-four-week drug, and that every two-week drug is not giving you good rebates because they don't need to. Encourage anybody to actually ask payers, will they cover us, and will we have access, and do they think that it'll drive uptake? And the answer across the board from every payer has been yes. So I think it's a very familiar line that investors kind of reach to that is completely false in our situation.
Payer is also like compliance, and Skyrizi, every three months has 95% compliance. With Dupixent, over 50% of patients go off in two years. So that does not help from a payer point of view to have that lack of compliance.
Right. And the low cost of goods doesn't hurt from a flexibility perspective as well.
Yep.
We didn't even cover the catalysts or the pipeline, which I feel awful about. But I felt like a lot of these controversies we really needed to kind of drill into a little bit more deeply and into the conviction that the team obviously has about the commercial opportunity for 777 alone. Just rip through the pipeline if you can, and your enthusiasm there.
Yeah. So I'll just kind of go in order of readouts. So first half of the year, we're going to have OX40 ligand, our healthy volunteer readout. Really excited to show that we can get to every hopefully three and six-month dosing and then share more around our combination plans. We're kicking off our combo trial this year. It's head-to-head versus Dupixent with data coming next year. Of course, mid-year, right in the summer, is going to be our 777 phase II readout. I think it's going to be a very exciting readout for all the reasons that we've talked about. Our TSLP readout will come at the end of the year or second half of the year. And then maintenance data for the part A trial and the part B readout will come next year as well.
And then there's also the expansions, right? So we'll have our 777 monotherapy in asthma, a phase I-B start of the first half of this year, a II-B second half. And then our second expansion indication, EoE, will start a phase II next year.
Great. Well, I apologize for not getting more deeply into the pipeline. We'll make sure that we do that at our next conference in November, and really enthusiastic to see all of the catalysts and all the cards kind of turning over through the balance of this year. Thank you so much for joining us here.
Thank you.
Thank you.
Really appreciate it.
Thanks.