Good afternoon, everyone. Tyler Van Buren here, Senior Biotech Analyst at TD Cowen. Thank you very much for joining TD Cowen's 45th Annual Healthcare Conference. For our next session, very excited to have a hybrid presentation and Q&A with Apogee Therapeutics, and it's my pleasure to introduce Michael Henderson, the CEO, Carl Dambkowski, the Chief Medical Officer, Jeff Hartness, the Chief Commercial Officer, and Jane Pritchett Henderson, the Chief Financial Officer. It's a privilege to have you all here with us. Thank you very much for joining us, and Michael, I'll go ahead and pass it over to you to start with the presentation.
Great. Thank you for the opportunity, and thank you all for coming today. I'll try to be brief with the presentation so we can get into the more fun Q&A. But Apogee Therapeutics, we are a company developing potentially best-in-class therapies for the largest markets in the inflammation area. So specifically, our lead program is where we spend most of our time with investors right now. That is an IL-13 antibody that's designed for best-in-class properties going after atopic dermatitis. Middle of this year, we will have data showing if we have potentially an every three and six-month dose product in the largest I&I market of atopic derm compared to the current leading drug, which is an every two-week drug. We're investing around that potential by launching an asthma study with our IL-13 drug later this year, and then an EoE study, eosinophilic esophagitis, next year.
Yesterday, we were very excited to announce data that fully unlocked the potential of the second program that we'll talk about, which is APG-279, a co-formulated product which is IL-13 and OX40L inhibition. The data that we shared yesterday shows that in a single two-milliliter autoinjector, we have the potential for every three-month and six-month dosing for that program as well. In this co-formulated product, we are running it head-to-head versus the market leader, Dupixent, and we're kicking that study off this year with data coming next year, and then in the other I&I markets that we're pursuing, asthma and COPD, in order to enable best-in-class efficacy and dosing, we are pursuing IL-13 and TSLP inhibition. We will share more data around that later this year once we have the TSLP monotherapy data, which we hope will fully unlock that program as well.
For our pipeline, we aim to create fully optimized best-in-class antibodies. Across our first three antibodies now, we have shown best-in-class PK and formulation data that shows that compared to first-generation antibodies, we are getting 2.5- 5x the half-life of those antibodies, and also 40%+ improved formulation on average versus those antibodies. The upshot is that not only can we extend dosing, but we can push exposure to see if that can lead to improved efficacy, and we can co-formulate these antibodies at high concentration to enable our combination approaches to also have that best-in-category dosing while pursuing best-in-class efficacy as well. The upshot of this is that over this year and next, we will have multiple shots and prove that we have a potentially best-in-class drug in terms of both efficacy and dosing for the $50 billion atopic derm market.
We're then going to be pursuing that same approach to asthma, EoE, COPD, and a number of potential expansion indications to build a leading company in the I&I markets. A bit more on 777 and the upcoming data that we have and the expectations for that data. The design is an integrated phase II-A and phase II-B design. The phase II-A was fully enrolled as of the beginning of February. We announced that, and then within a week of finishing enrollment in that study, the full integration truly kicked in, and the phase II-B component started dosing as well. The part A dosing is versus placebo. We have greater than 90% powering for the endpoints that we were testing there, and then patients, after the first 16 weeks of induction, flip over to maintenance of every three and six months.
What's really unique about our study is that typically people don't test maintenance until phase III, but by bringing maintenance dosing into phase II, not only have we created a study that patients and physicians really like because they can continue getting benefit from a drug if they're getting benefit and can kind of see that through for a longer term, but we'll then have maintenance data in our phase II prior to kicking off our phase III. So for us, it's not a question of will we have an every three and six-month dosed drug at launch. It is, what will the dose be for the every three and six month as informed by our phase II data? The part B, we're then testing even higher exposures of 777 monotherapy.
This is made possible by a safety review of the part A that showed no safety issues were seen, and we are safe to proceed to even higher doses, which is expected, but still a nice benefit of the integrated design, and again, testing every three and six-month maintenance dosing. While the bar for success, and we have been exceedingly clear on this, is similar efficacy and safety to Dupixent with improved dosing for 777 monotherapy, we are testing higher exposures of IL-13 inhibition to see if that can lead to improved clinical outcomes. There are a number of different pieces of evidence that suggest higher exposures could, in fact, enable this. The Lebrikizumab or Ebglyss phase II-B showed a very nice dose-dependent response that did not plateau.
Higher doses were just never pursued because of commercial considerations of how much could be fit into a 2 mL vial, dosed similar to Dupixent. Beyond that, when the EMA and FDA published their reviews, we saw signs of an exposure-response seen, and the EMA in particular did a subcategory cut that low body weight patients, of which there were close to 200, had higher exposure leading to improved efficacy, and then lastly, the parameters of an exposure-response model were kind of made public via those FDA and EMA reviews. One can spend a fun weekend or longer recreating this, and you can see that, yes, in fact, there is an exposure-response, and you can model out what higher exposures could do. Just to reiterate, similar safety and efficacy as seen here is what we need to see to have commercial success of this drug.
I believe there was a panel yesterday where KOLs were incredibly clear. An improved dose drug that's similar to Dupixent takes the market, right? Doesn't just get share, is their top choice, and to quote those docs, effectively, the sky is the atopic derm. Yesterday, we announced more data around our combination program, APG-279. This is a co-formulated IL-13 and APG-777 and OX40 ligand and APG-990. We had a 60-day half-life for OX40 ligand program, which when combined with the formulation data of the monotherapy and the co-formulation gives us confidence that we can reach an every three-month maintenance profile, or better, for this drug in a single 2 mL autoinjector by commercialization.
The deep type 2 inhibition with additive type 1 and 3 inhibition that the combination gives us provides pre-clinical proof of concept of potential superiority to the market leader, Dupixent, and a profile much more similar in type 1, 2, and 3 inhibition as JAK inhibitors. We know from clinical data that JAKs with their deep type 2 and broader inhibition lead to much better efficacy compared to the type 2 inhibitors, Dupixent and Ebglyss, and even the higher dose or higher exposure body weight subgroup that we're replicating in our ongoing phase II. The issue, of course, is the safety profiles, which we'll get into the data we have suggesting our co-formulated product will not have those same liabilities in a moment. The design of the study is a head-to-head trial versus Dupixent.
It is a simple one-to-one randomization of 279 versus Dupixent with both 16-week and 24-week efficacy readouts. We are on track to have this data second half of next year. Just to iterate the size, the potential here, because I think this is lost on folks, just, and I know it sounds a bit coy, but the size of the atopic derm market in I&I is truly unmatched. We all know psoriasis where eight different biologics you've seen over time all become blockbusters. With the one that gets to quarterly dosing, Skyrizi, despite launching next to last, is already the leader and set to get to 40% share. These are large markets where many people can happily coexist, and they are not one to take all.
Atopic derm, by contrast, has 3x as many patients, moderate to severe, apples to apples as psoriasis, and has had a much more impressive launch to date. Market research has been exceedingly clear. Any KOL that we've spoken with, and any KOL that consultants assemble for their panels, if you ask them what they want to see, it is a longer dose drug because they have been so educated by psoriasis that this leads to improved compliance and outcomes for patients. Patients, of course, 90%+ will prefer the longer-acting agent, all things equal, and payers who have very few options on what to cover and what to get rebates for currently in atopic derm, just given the few options, are also very excited about another option that can improve adherence compliance and create more competition for themselves as well in this space.
We are very well funded with no need for cash until 2028, over $730 million as of year-end close, seven clinical trial readouts over the next two years, and the largest of which, in our opinion, is coming in the middle of this year, which I'm sure we'll now spend a lot of time talking about. Thank you.
Wonderful. Thank you very much for that presentation, Michael, so I wanted to start with a general question, so you guys are largely, I would say, in the lead in terms of companies that are working on combining these large mechanisms for I&I and these super effective mechanisms, but there are competitors emerging. There's Chinese companies. You've got people on Wall Street who've never operated a company or developed a drug saying that's easy just to slap a YTE into an antibody, so curious to get your high-level thoughts on how specialized it is, what you all and Paragon have done, and why it's not difficult to just copy what you're doing.
Yeah. So any graduate student could add YTE on an antibody, and they would make a bad antibody. They just would. I think that we've seen this now time and time again, a number of these antibodies that have been advanced after minimal preclinical validation, and just to be clear, significant spend. It takes significant capital, which we are fortunate to have, to create a fully optimized antibody. If you don't do that, you end up with an inferior compound. Let's look at OX40L in particular. OX40L, again, we had a 60-day half-life, a very nice concentration improvement versus what's been done before. There are other half-life extended OX40Ls out there that are only getting into the 30-ish day range.
I think it's clear that we are creating best-in-class PK for our antibodies by not just trying out YTE or LS or other half-life extension mutations, but also different backbones. We switched to IgG1 LALA, a much more contemporary commercial-friendly backbone for our antibodies today. We have also, by doing all this, created a good amount of IP, both in terms of what has started to be published and what we have decided not to publish on as well. The last piece, and I think this really came out clear in our data yesterday, we are very intentional about ensuring our antibodies through their processes can be co-formulated together.
The fact that 777 is at 180 mg/ mL alone and that the co-formulation is at 180 mg/ mL or greater speaks to the fact that we are leaving nothing on the table by virtue of how regimented we are and how much spend we took on preclinically before advancing all of our assets by picking the best one, that that moat, I think, is starting to become clearer and clearer. Five years in, close to $1 billion raised. Fortunately, we haven't spent most of that. Not only do we have a temporal lead, but we are now continuing to accelerate that lead by the KOL and patient enthusiasm that we have for our trials as well, which has led to very fast enrollment too.
Why might co-formulations be the optimal approach relative to bispecifics, and how do you guys plan to optimize those co-formulations as you look at these combinations?
Yeah. So let's look at, for instance, what we've shared around our co-formulation for IL-13 OX40 ligand. To get to the adequate exposures for OX40 ligand, we need 50 mg dosed every 12 weeks. We need closer to 300 for 777. Those are very far from one to one. Bispecifics, you're in a one to one ratio. Secondly, there has, and this could change, breakthroughs happen all the time, and there are a lot of smart people working on this. Bispecifics have not been able to get to that every three- to six-month dosing. I think that those that are going after IL-4 receptor alpha, those are going to be four-week to eight-week at best before you have to get to multiple injections.
We know this because we made a half-life extended IL-4 receptor alpha antibody, and you just can't get to the same dosing interval. The one-on-one inhibition is one piece. You don't want that against many of these targets. You want to push hard on one, which is the backbone, in our case, IL-13, then be able to dial in with precision the other one. Second, the dosing. Third, ultimately, when we thought about our path forward years ago, we could have pursued either. A lot of smart people can make bispecifics as well. You eventually are going to have to run the comparator study. Otherwise, go ask any payer. Hey, if I have a bispecific that comes to market, what are you going to need to see in order to get frontline therapy?
They're going to say, well, you're going to have to show that it's better. Otherwise, I'm going to have you step through IL-4 receptor alpha. I'm going to have you step through IL-13 or whatever it is. So if you're going to have to run those studies anyways, you might as well create the best commercial embodiment of that properly titrated longest half-life drug, and that's what we chose to do.
Do more companies entering this space against the same targets or the increasing competition, does it change your strategy at all in terms of developing your assets?
For us, it's all about, it continues to be about how can we not just maintain the lead that we have, but build upon it. So the best defense for us is a strong offense. I think the capital formation, the fact that we were first and able to raise the capital, enables us to do a lot to accelerate things at risk that these companies simply won't be able to afford to do. And ultimately, we're going to have our critical data this year. These companies are preclinical at best. We're years away from knowing what they even have.
Great. So let's move to APG-777 with a 77-day half-life. As you mentioned on our derm panel yesterday, we had during the AD portion a bunch of answer options for agents in development for AD, and 60% of physicians selected either 777 or 279, essentially the combo with 990, and then I asked the panelists, if you have equal efficacy, same equal efficacy and safety, but with every three-month to six-month dosing, what percentage of patients would you treat, and I was expecting to set her up with a follow-up question, which would be, what if you have improved efficacy, but she said 80% plus penetration with equal efficacy, so as we think about the phase II atopic dermatitis data coming up mid-year, I guess expectations are pretty straightforward, but what are you going to be presenting?
Is it going to be a whole host of data, or is it going to be a limited top-line release? Obviously, primary endpoint is EASI Score, but I guess people tend to focus on EASI- 75, right? But curious to hear your thoughts.
Yeah. And I'll welcome Carl to add in as well. We will, as we have with any of our data releases, look to tell a complete story. So a whole host of data. So not only change from baseline EASI, but EASI-75 and higher order things like EASI-90, IGA 0/1, EASI-100. I think what's really important in those is that you do not see high placebo rates in any study against those higher order endpoints. So a lot of the noise that we started to hear from trials, which were designed very differently than ours, than Dupixent's, than Lebrikizumab's, but had high placebo rates, just to give people an additional assurance of will they be able to draw a conclusion from this.
We believe so, given that we will be as disclosive as the data allows with that, because we feel this is our chance to show, do we truly have the mega blockbuster that we hope we have?
Anything to add, Carl?
That seems pretty comprehensive. So I'd just add itch to that. I think obviously itch is important here too. We've seen that Lebrikizumab and Dupixent have both had really good changes on itch too. So that just in addition to EASI and IGA, that would be the additional piece that kind of would round out the whole picture for that release mid-year.
Great. And as we think about you going to 30%-40% greater exposure and induction in part A and potentially up to, I guess, 70%, well, 60%-80%, double 30%-40% in part B, what gives you confidence in the safety based upon what you've seen so far?
Yeah. Yeah. I think two things that really give us confidence in the safety. One is our phase I healthy volunteer study. We went up to 1200 mg in that study. And you can see we consistently do that in our phase I studies. So we get good high exposure data from healthy volunteers. These aren't kind of minimal doses too. And across the 777 healthy volunteer study has been very well tolerated across all doses, including that dose. And then the second piece, I think, is in order to enable the transition from part A to part B, we have a blinded IDMC, which is the Independent Data Monitoring Committee, or sorry, unblinded IDMC, Independent Data Monitoring Committee that looks at the data and makes sure that they are comfortable with us proceeding with the trial as planned, which included going to a higher dose too.
Their recommendation was to move forward with no modifications to the study. From those two standpoints, I think we feel comfortable going into that. We're seeing something in range for what we would expect for an IL-13 inhibitor.
Great. And the 52-week follow-up for part A, I guess first half of next year, that's when you will decide on whether you take forward three-month or six-month dosing or both. I mean, you mentioned it's not a matter of what duration, it's just the dose. So do you plan to take both forward? And how do you think about annual dosing, that pSTAT 6 graph? I mean, it drops to the floor and goes sideways pretty much through a year. So curious to get your thoughts there.
Yeah. So for us, we want to create options for patients. So that means having an every three and six-month dose option. Lebrikizumab has every two to four weeks on their label. We'll be learning, is a single injection adequate at six months, or do we potentially need two? But then trying those both, I think, would be very helpful. And Jeff, do you want to maybe speak to how we think about why optionality is important in an annual?
Sure. So I appreciate this question, Tyler, because it is important. Everything that we do, we're putting the patient at the center of that, so thinking through the patient needs and what they want, and this is where Michael talked about 94% of patients when they look at an equal efficacy safety product, that 94% of the time they'll choose the Q3 month dose, so they'll choose Apogee's 777. The Q6 month dose is important because when you talk to physicians, you not only are looking to gain market share with biologic naive patients, but you're also looking to gain market share with what is right now north of a million patients in Dupixent that are dosed and will be much more than that in the coming couple of years.
Physicians, 57% of the time say that they would actually take a current biologic patient and switch them to a Q3 month AD product. That number increases with six months, so it allows us to grow that market share even more. Michael spoke a little bit about why this is so important to payers. The compliance and persistency matters because it takes cost out of the system. If you look at persistency rates real world for Dupixent, they're down in the 72-ish range after the first year. Q3, Q6, and then annual dosing, obviously, you're able to increase those rates significantly, which is good for the patients because in real world, they're taking the medicine, they're seeing the results that we intend, and then for the annual dose, we think that both patients and physicians in time are going to want to continue to move that forward.
It's much simpler for patients, and then physicians know that that patient is going to have the compliance and the persistency that they want to get the result that they desire.
That's helpful, color. But just to be clear, so annual dosing is something you might consider in the future after you get the maintenance data?
Lifecycle management.
Lifecycle management. Got it. Okay. Combinations, again, 777, 990, 60-day half-life yesterday morning, once again, exceeding expectations, coming a little earlier than expected. The JAK-like efficacy, but without the safety liabilities sounds pretty darn good. I guess you highlighted some of this during the R&D day, but what are you seeing preclinically as you test your candidates that gives you confidence that you may be able to achieve this?
Yeah. So preclinically, we're seeing against a number of different assays, similar inhibitory profiles to the leading JAK inhibitors, particularly Upa or Rinvoq across type one, two, and three inflammation. I think that's. We couldn't really be asking for better data from that. And then on the safety side, we're seeing. We announced on Monday that we had finished our combo tox studies out to the full ICH guided max three months. And at 150 mg per agent in non-human primates, we saw absolutely no tox. You can look at, and we shared this as our public, what JAK inhibitors saw preclinically. All that they saw in the clinic was also seen preclinically. Mix that with a larger body of preclinical evidence, including viral response assays, allergen response assays showing that our combo can be selective versus that broad JAK impact.
I think that we're as confident as we could be at this stage prior to putting it to the test in the clinic.
Going head-to-head versus Dupi is a bold decision, I think, in most people's eyes. Again, just what gave you confidence to do that? Do you think the FDA will require that? What would you hope to show in that phase II?
Yeah. I think all the preclinical evidence that we've had and also just the clinical data from the JAKs gave us the confidence that the 30-point improvement that the JAKs are seeing gives us a lot of room to be somewhere in that threshold and still get to 10-plus points better superiority versus Dupi. So hence, we're excited around that study. Then practically, I think you have to now 777 mono. It's different. Launching into this decade, well ahead of any biosimilars, patients, physicians, payers, incredibly clear with us that that will become their frontline agent of choice if it's similar on efficacy and safety to Dupixent.
2030s, when we start to think about biosimilars coming in, when we think about how we will hopefully have transition patients onto that three-month and six-month paradigm with our own agents, at that point, there needs to be proof of why you would do this versus Dupixent, and if it's a combo, in order for payers to not say, "Hey, you need to step through one or the other," which is fine if you're playing for third, fourth, fifth line agents, but if you want to be considered early on in the paradigm, you're going to need to have that proof of one plus one is greater than one, at least in some way. From a regulatory point of view, Carl, do you want to speak to how we think about that?
Yeah. I mean, I think that definitely they need to prove contribution of components at some point in time in this. And for us, this is a stepping stone to that too and an ability to really show the agencies that there's meaningful difference over monotherapy too, which we believe will help have more robust and meaningful conversations with them over time. I don't think it changes the fact that eventually we're going to need to do two replicate phase III just like you would with the monotherapy, et cetera, but definitely helps us kind of with those agency discussions. And then not asked, but I'll add on to this too. I think showing this early on is really helpful in terms of enthusiasm that we can generate behind this as a co-targeted approach that will actually be differentiated from monotherapies.
The improvements that can make in enrollment timelines, investigator enthusiasm long term, I think can't be underestimated. A small placebo-controlled trial with a multi-targeted agent, be it in co-formulation or bispecific, it's just going to open up a lot of questions for investigators of like, "Why am I targeting two things if it may or may not be better than one thing?" So we need to prove that early. That helps us kind of accelerate the path forward in maybe all these intangible but important ways.
That's great. And why not just pursue the APG-279 combination in all I&I indications? Why advance the TSLP and the combo with 777?
Yeah. So we have not seen the same body of evidence in respiratory indications that the combo that we have for Derm is the optimal combo for respiratory. I think we will be responsive to additional data for OX40 ligand as it comes in. Asthma data should be soon. But I think the bar set by TSLP and the ongoing secondary body of data that Sanofi has for their IL-13 TSLP every two to four-week dose nanobody, it has been impressive data to date. And it's going to continue to kind of de-risk that path forward.
For us, we are always thinking about how do we make sure that we're not just that we aren't drinking our own Kool-Aid in a sense and that we're setting ourselves up so that 10 years from now, we look back and think we put our resources towards the best combo partners or monotherapies to have best-in-class efficacy and dosing for the indications we're pursuing. So far, IL-13 and TSLP have a greater body of evidence for respiratory.
Okay, and speaking about 10 years from now, obviously, 777 is in the lead, but you've got these two potential monster combos coming behind it, so how do you expect them to fit into some of these overlapping markets? Do you expect the combos to cannibalize 777, or do you think they can all coexist?
Yeah. I'll hand it to Jeff. I think with the preamble that it depends on 777 Mono.
Yeah. And it really does. So if 777 Mono comes out, and as you know, we're testing 30% and 40% higher exposure rates in A and even more in B. Depending upon what that does, we don't need better efficacy to win, as we talked about. But if in fact we see better efficacy, then we are laser-focused on just growing that share as high as we can. I think that better efficacy and transformational dosing together changes the way AD is practiced. And so we'll drive that share. It's a matter of timing. I think we, like most others, believe that the I&I space is heading toward combinations in time because that's how we're going to be able to get the absolute best efficacy possible for these patients. It's a matter of timing as to when we start to drive toward that combination based on efficacy of 777 Mono.
Okay. That's helpful. And APG-808, the phase II-B data expected in the first half of this year, just maybe review expectations for that and the current plan for the 808 program moving forward?
Yeah. So APG-808, we continue to feel that we have a best-in-class profile there for a longer-acting higher formulation IL-4 receptor alpha. The asthma data we feel will really show us how long are we seeing an impact against a biomarker like FeNO or a good PD biomarker in that setting. Is it two months? Is it three months? Somewhere in between. So we'll be excited to share that data, likely via a press release when we have it. And for us, it's one, it's a great program to have as an alternative in case we ever find that there's an indication for which IL-4 independent signaling does play like severe allergy or something like that. We don't believe that that's the case for any of the current indications, but we'll have that in our back pocket or create additional optionality for the pipeline.
You briefly mentioned your very significant cash pile, still $750 million roughly, and the runway. Does the success of these clinical trials change that runway at all as you think about spending for the future?
No. Because we are focused on allocating the capital to 777 Monotherapy in AD and launching this decade. As we deliver more data, as we create more value, we'll have opportunities to think about additional financings. But the strong balance sheet enables us to drive to those phase III trials and then to a potential launch, as well as, of course, the expansion indications. We think it's important, for example, with asthma, with the 30% overlap between AD and asthma patients, to also drive that to some top-line data as well.
Okay. Great. We're definitely over time. But to close out, what do you believe is the most underappreciated aspect of the Apogee story by investors right now?
Yeah. I think it's just the potential size of this drug. People are looking at launches right now and companies that are much larger than us, will they be one to two billion peak? We're talking an order of magnitude higher than that as a base case for our lead. And I think because there just aren't biotechs that are actually launching an atopic derm front line like this, it's just different. If Ebglyss was in a biotech, we would have an argenx to point to, but we don't. It's kind of hidden within a much larger company. And therefore, the easy kind of valuation metric, it's just harder for investors who are very busy spending their time to do. And therefore, we get bucketed into pre-phase II comps, which is fine.
We're going to have data, and we believe that data will show the potential of what we have later this year.
You've got the cash to execute on it.
Yep.
Thank you. And thank you to the Apogee team.
Yeah. Thank you.