Good afternoon, everyone. I'm Sean Laaman, Head of U.S. Mid-cap Biotech Equity Research here at Morgan Stanley, and welcome to Morgan Stanley Global Healthcare Conference. Before we begin, to make you aware of some important disclosures, please visit the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. For this session, we have the pleasure of hosting BridgeBio Oncology Therapeutics with the CEO, Pedro Beltran, COO, Idan Elmelech, and Ben Yong. Thank you, gentlemen, for your time today.
Thank you.
Maybe just to begin with some broad macro questions before we delve into the specifics of BridgeBio. Thinking about the rise in China-led innovation, a really hot topic in biotech, does it change your competitive positioning or how you think about R&D in your BD playbook?
Yeah. Thank you, Sean, for the warm welcome. Yeah, great question. Obviously, we're super excited about what's going on in China. I think it opens great opportunities for companies like us that are innovating. I think the way I would summarize the current environment would be maybe two buckets, right? One would be the innovation part of the drug development process, and the other one would be the speed, right? I think on the speed perspective, the economics of speed are changing dramatically, and China's playing a huge role there. Competing against that, I think, is going to be very difficult, right? On the other side, on the innovation mechanistic side of things, I think we're still highly competitive there. How does that apply to BBIO, I think is a key point.
If you look at the China environment, maybe in the last few months, you'll see three G12C off inhibitors that have been approved. I think when a mechanism works and people believe in it, I think China is very good at moving at super high speed, making molecules, and those can come back, and people can take advantage of that proven mechanism. But I think on the innovation side, I think it's a playing field. If you look at what we have done with BBO-8520 being an off-on inhibitor, the ability to target that GTP state, that has now been replicated.
Sure.
Our breaker molecule, which is first-in-class breaker of the PI3Kα and its RAS interaction, that also has now been replicated. I think, as long as we stay very much focused on the things that we can do new, China will be, and it is very competitive on that, but the innovation part, I think, makes you be able to compete well. If we just try to compete on speed, trying to do a mechanism that is already validated, I think that's a big advantage that China is showing today.
Sure. Thank you.
Yeah.
And maybe still on the macro.
Yeah.
Are you implementing AI across your business?
Yeah.
Can you point to a specific example, perhaps, where it's changed a decision, a cost outcome, or even a POS?
Yeah. We obviously are trying to incorporate AI, and then maybe Idan can follow here, on a daily basis into our workflow. I'm certainly surprised from what I see from my team, how faster we can do things. I think from a research perspective, from my biology background, I would say maybe three things. The first one, really putting together co-folding tools. So the ability to reiterate hypothesis on a structural basis. Instead of having to make every single compound and test the hypothesis, I think AI has a huge advantage in trying to test this hypothesis in silico. So we do a lot of that for our early research programs.
AI coding, I think it's another place where a lot of the team are using that to try to put our, maybe a smaller data set in the context of a much bigger data set, and trying to see where there are synergies, what can we learn from what's in the literature, and also reiterate that process and that affects the time at which we can build hypothesis and test hypothesis. Then I think one maybe a little fun one is the agentic AI part of debating with AI when you have a hypothesis, and you can do that in a couple of days, really narrow it down to a much better clinical hypothesis or biology hypothesis.
That, I think there's at least a couple of examples at BBIO where we have narrowed down the trial design or other key center hypothesis for one of our assets in a much shorter time that it would have taken to send a group of people to do this and search the literature and come up with a refined hypothesis. I don't know if you want to add anything to that, Idan.
Yeah. No, I think the impact here is really on cost reduction and cycle time. Especially if you look at a big part of the cost we don't talk about in biotech, we talk about per patient cost in clinical trials. But a lot of the fundamentals of the ongoing business, right, everything from accounting to finance, regulatory submissions, all of those pieces, I think you're already seeing a high impact.
Sure. Thank you. Last question before I dig into BBO-8520. Which policy variable, maybe you'll say all of these, but which policy variable, FDA, Medicare negotiations, MFN may be not so important for you guys at the moment, but tariffs or global pricing Which of those are the most important to your economics? Or which are highest on your.
Yeah, I think for this stage of our company, it's all about the FDA interactions.
Yeah.
Right? Trying to really understand how the FDA is changing, especially in a high unmet medical need like cancer. What can we do to get our data in front of them sooner, agree on trial design. Ben, I don't know if you want to add anything there.
Not much. I think that what we are focusing on in terms of the tumor types, the major tumor types, non-small cell lung, pancreatic, colorectal. So tumor type-wise, we don't need to think about some of the niche hub tumor type to begin with, that may have an implication in terms of early pool, especially for small molecules. So right now, I think we're still relatively early, so not much in terms of how we think about the timing and prioritization.
Sure. Thanks, Ben. Maybe to go more specific on BBIO.
Yeah.
Let's start with BBO-8520. So reflecting on the data last week, maybe walk investors through what you reported and what stood out to you.
Yeah. So obviously, we released data, we can go over that. The key strategic prioritization that we communicated is really focusing on how we're going to allocate resources for BBOT in the coming months. So we want to make sure that we're going after indications that are high priority for clinical success, have a very clear path to registration that we can communicate, and third one, and maybe most important, that there's a large patient benefit that comes from that. And so what you would see in the BBO-8520 setting, which is again our G12C off/on inhibitors, is a small molecule that can bind directly to G12C when it's bound to GTP, and that brings advantages. What we communicated there is a change from the first line to the second line. And we show data in two settings.
Naive second line data with still 60% plus overall response rate that compares very favorable to the G12C off inhibitors. Then second line plus data set showing 75% ORR in the 500 milligram dose and 50% plus ORR across all doses in that G12C experienced patient population. So what we're seeing is that if you look at what's happened in the first line, there's about five trials of G12C off inhibitors being combined with pembrolizumab. We think the signals from those trials are very positive with 80% plus ORR, 30-month PFS. We see that in the next three years as the first line, which will leave a series of patients that are going to be pre-treated with G12C inhibitors in the second line. So any G12C inhibitor needs to be able to work after a previous G12C inhibitor, and that's the population that we're targeting.
The advantage of doing that with BBO-8520, and that's where we believe we can differentiate in this patient population is we carry the on state so we can work after off. Second, we can combine with pembrolizumab without the liver toxicity. So that also transpires in the data with no Grade 3 liver toxicity in the naive patient population and single-digit percent in the pembrolizumab combo population. So both of those attributes really give BBO-8520 the best chance of working in this upcoming market where the comparator is going to be docetaxel chemotherapy with single digit ORR and maybe four-month PFS. So we feel pretty excited about that opportunity for that molecule.
Right. So I think my next question was about the reprioritization you announced last week, but I think, Pedro, you just answered the question.
Yeah.
Thank you. How should we think about execution and the path from phase I towards registrational development across three mechanistically distinct programs?
Yeah. The strategic update we gave last week was a big part of that initiative. I think with the G12C program very clearly we've updated data. Our guidance on that program is for the next update to be in the middle of 2027. An imperative year for us is, one, to establish what the duration profile looks like in this refractory population, and also to accrue more patients to confirm the signal. At that point, I think we'll be ready to discuss a potential registrational path. Then on the breaker and the pan-KRAS inhibitor, so our second two programs, that is one cohesive strategy, right? We're enrolling across PDAC and CRC.
multiple combination regimens. Our guidance here is, one, a de-risking event in the fourth quarter of this year, so upcoming in the next few months. Monotherapy data on both the pan-KRAS inhibitor, BBO-11818, and our breaker, BBO-10203. Then the bigger and more fulsome data set, including combinations coming in the middle of next year. That's when we'll update on registrational path in those indications.
Sure. Thank you. On combos, tolerability and combinability have been real constraints for the G12C class. Last week the BBO-8520 update again showed no Grade 3 liver enzyme elevations. How are you thinking about that profile as the data set grows and moves into combination, and what would you want to see to be confident it holds?
Yeah. We are very focused on the pembrolizumab combination. I will let Ben add here. We believe in non-small cell lung cancer, you have to be able to do the pembrolizumab combo. We designed this molecule with the hypothesis that if you hit the on state and you are able to capture the covalent mechanism of action, meaning detachment of PD and PK, have very low free drug concentrations when you combine with pembrolizumab, you have a much better chance of not having the hepatotoxicity that often you receive because they have to be present essentially all the time to cover target. We believe that our data now is showing that, and that is very key for patients. Ben, I do not know if you want to add anything.
Yeah. Again, we are really excited about the combo data, not just in terms of the response rate we have observed so far, also the safety. If you look at the spider plot including the DAC, where you see some of the early readout patients being on treatment for over a year, and usually artificially draw a line about six months, the majority of patients still remain on treatment. That means some of the toxicity you see is pretty manageable and those patients are able to stay on treatment for a long period of time.
Sure. Thank you. Beyond the roughly 75% of eligible patients staying on treatment past six months, what are you seeing on duration of response and PFS as the data matures? How do you think about durability, given the on-off mechanism?
Yeah. We have not shared anything further other than the 75%, which we think is a good number. We are excited about the monotherapy data. We think it compares very well to what others have shown.
Okay. Your combat strategy now centers on second line plus inhibitor-experienced patients, where there is no approved targeted therapy. How do you see the registrational path there, and how do you think about the commercial opportunity of G12C off-state inhibitors move into first line?
Pedro already alluded. It is exciting the second generation G12C inhibitors are kind of moving to first line. If you think about the landscape, what was left on the table for those patients who progress on the first-line treatment, really, single-agent chemotherapy, that is far from optimal in terms of both efficacy and safety. The bar is really low. We are talking about single digit ORR, previous mention, very short duration treatment. You can imagine for a phase III study, it is not a large phase III to demonstrate the superiority compared to standard care now.
Wonderful. Moving on to BBO-11818. Earlier this year, you disclosed the first monotherapy pan-KRAS response in pancreatic cancer patients at 56% tumor reduction. With a monotherapy update due in 4Q, what would you see as a convincing signal across KRAS mutations, and how many patients and tumor types is that update likely to cover?
Yeah. Let me just start by saying, part of BBOT, one of the four pillars is that we believe that KRAS is the driver oncogene. We think the best therapeutic index comes from being able to cover KRAS and have a selectivity against HRAS and NRAS, and that is the design of a pan-KRAS inhibitor, BBO-11818. What we are planning on talking about at the end of the year in Q4 is essentially a monotherapy cohort in pancreatic cancer, second line, where most of the pan-RAS G12D specific data from competitors has been released, so that we can compare what the level of efficacy is in comparison with those settings. Obviously, the safety profile we believe is super important. Our initial release in January showed differentiated skin toxicity, so very low rates of skin toxicity, no stomatitis. We think that is already very differentiated from a pan-RAS approach.
We hope to give a homogeneous cohort with a significant number of patients that people can make comparisons in.
Thank you, Pedro. Which opportunities do you see pan-KRAS as being potentially most differentiated, and how does it sit alongside mutation-selective agents and pan-RAS approaches in the field?
Yeah. We see kind of the sweet spot. If a pan-KRAS, you are able to really focus on that driver oncogene. You have the ability to get multiple mutant isoforms, but you are not hitting NRAS and HRAS to complicate your safety profile. Then also very important, we believe, is being able to inhibit wild-type KRAS. There is ample evidence in the literature that amplified KRAS or non-mutant, but amplified KRAS can drive tumor growth. We believe that is a potential response resistance mechanism that a G12D specific inhibitor cannot address. That will have to bear out in the clinic if it is a head-to-head study or comparison across trials, but we will have to see that. Those are the advantages of a pan-KRAS approach. Yeah, that is what we hope to see in the clinic.
Sure. Thank you. Moving on to BBO-10203, can you maybe refresh us, what the mechanism is and what it is hoped to achieve?
Yeah. If you think about our approach of having on inhibition, right? On inhibition means you block effector binding. If you take that now to BBO-10203, the molecule binds to PI3Kα. Right? PI3Kα is the effector. By binding directly to PI3Kα, you block any RAS from binding to PI3Kα and activating the AKT pathway. We like to summarize the mechanism as a pan-RAS inhibitor, but only for the PI3Kα pathway. Right? The biology here is that when you block the MAP kinase pathway, the RAS-MEK-ERK pathway, you get reactivation of the AKT pathway as a salvage survival mechanism. That reactivation can happen through any RAS.
What we see is that when we put a KRAS inhibitor and we see that reactivation of AKT, if we put 10203 in that experiment, we can block completely any reactivation of AKT, and that results in very cool synergy both in vitro and in vivo. That is what we are trying to replicate, an experiment where we can block optimally both of these pathways, and get the best efficacy with the best PK.
Sure. On that one, we have got upcoming monotherapy data in 4Q . Can you tell us what indications you are looking at and what we should be looking for in the data?
You want to go?
Yeah. The BBO-10203 monotherapy update that we are expecting in Q4 of this year is really just an update on the escalation data we shared earlier this year ahead of J.P. Morgan conference in January. It is an escalation cohort, 150 to 750 mg QD, and just extended safety signals on that patient population, which again, was largely third line plus colorectal cancer patients.
Sure. Thank you. Moving over to the platform. You talked about combo between BBO-11818 and BBO-10203, and I think the plan is to concentrate in both CRC and PDAC. Will that concentration remain, or do you see an opportunity to expand into broader tumor types?
Yeah, I think that is our initial area of focus. We see a potential competitive advantage here on both indications. But this is just sort of the first step in combination, and we will let the data guide us on future combos.
Sure. I guess, on the combo, how do you see BBO-10203's role, and what does the biology suggest it adds on depth and durability?
Yeah. The way we think about the PI3Kα pathway in this setting is when PI3Kα is driven by mutant RAS. If you look at the biology and the protein interactions, mutant KRAS loves to activate PI3Kα. That is very different than wild type KRAS or NRAS or HRAS. There is a preference for that mutant allele to bind PI3Kα and activate that pathway. The thought there is that if you do not do that, if KRAS is not able to activate a PI3Kα angle, then the cell actually undergoes cell death. It is classical oncogene-induced senescence from super activation of the MAP kinase pathway. No PI3Kα. The cell can deal with the signaling and dies. That is where we see the breaker activity in KRAS mutant tumors. That obviously is mainly lung, PDAC, and CRC, and that is where we are playing.
Sure. Thank you. As we look into mid 2027 when we might get the combo data, what are the key aspects you would point to in assessing synergies for this internal combo?
Ben, you want to do that one?
I missed it. Different part.
Sorry. If you look into the combo data, which I believe is due mid 2027, when you look at the key aspects of the combo, what would you point to in assessing the synergies for the combo?
Yeah. I think what we will share will be a preliminary safety data mainly around the combinability of those combination. There are some challenges in terms of combining with the sacituzumab with the pan-RAS. We haven't seen the data because of potential overlapping toxicity around the skin tox. Based on our current data, I think the very differentiated skin toxicity we haven't seen much. Hopefully we'll be able to show the differentiated combinability. Hopefully on top of that, we'll show some meaningful efficacy, early efficacy with those combo as well.
I think CRC is one place where we think we can differentiate. From the three indications, CRC is the one that has 15%, 20% PI3Kα mutations by itself. We think that highlights the biology of PI3K signaling. Obviously that will be a place where it's a much wider space. RAS monotherapy, any type of RAS monotherapy has not really shown yet what we have seen in lung and PDAC. Opening the biology in CRC would be a great way to achieve that, convincing that we have done something differently.
We've talked about the programs, but as you progress towards registrational studies, how do you weigh up partnerships versus internal ownership of the programs to fruition?
Yeah, absolutely. We're very active in our internal discussions on business development opportunities. I think really what we're driving towards here across all three programs is a clearly differentiated data set with a clear path to registrational opportunity.
Once we get there, we'll do some more in-depth assessments on potential business development activities.
Okay. I guess, as you look to later stage studies, do you see that RAS is a rising tide dynamic to how the market values the next credible RAS developer, or does an established leader set a high bar for your data?
Yeah, I think I would say this is a super exciting time for people involved in drug development and oncology, right? I personally have been waiting for a long time to say that we are finally hitting that driver gene, right? We are doing it now as a community, and I think oncology has a very clear history of bettering, right? You always have that first discovery, that first compound that starts to make a difference in the clinic, but inevitably that's followed up by a best next in class inhibitor, better mechanism combination, and I think we're just beginning to do that. Yes, I think, next in class advanced therapeutic against RAS, we will see better therapeutics in the next 10 years, and anybody working on this area is going to benefit.
Sure. On the balance sheet, I think you finished Q2 with $3.4 million. You filed a half a billion dollar shelf beginning of September. Can you remind us what the runway covers and which catalyst it takes you through to?
Yeah. It is all three catalysts that we have outlined. So the monotherapy data coming in Q4 of this year, as well as the data across all three programs in combination mid-next year. It essentially covers full phase I development the way we are seeing it now across all three programs with some comfortable buffer. The actual runway guidance is into 2028.
Right. Thank you. We have had a good run through on the programs, a good run through on the upcoming catalysts, how you are positioning, how you think about combinability. We have also talked through the balance sheet and the runway. Did I miss anything? Is there anything that I should have asked that I did not, or a message you would like to leave investors with?
No, I do not think you missed anything. I think just as we are super excited to be playing in this field. As I said, we believe we bring something novel to the table. We have our pillars of what we believe RAS biology is important. We have made therapeutics that address those pillars, and we are really looking forward to generating data that is differentiated that will help patients with malignancies driven by mutant KRAS.
Well, wonderful. It might be a nice time to park the conversation, but thank you for your time, gentlemen. I appreciate it.
Thank you.
Thanks.