Good afternoon, everyone, and thanks for joining us on day three of the Morgan Stanley Global Healthcare Conference. I'm Mike Ulz, one of the biotech analysts here, and it's my pleasure to introduce Steven Nichtberger, CEO of Cabaletta Bio. Just a reminder, the format for today is a fireside chat. Maybe we'll leave some time at the end for questions from the audience, if there are any. But before we get started, I just need to read a quick disclosure. "For important disclosures, please see 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." And with that, Steven, thanks for sharing your time with us today, and I thought maybe I'd just turn it over to you to give us a quick background on Cabaletta, and then we can hop into Q&A.
Sure. So thanks for inviting us. Appreciate it. So Cabaletta exists for only one reason, in order to develop and launch the first targeted curative cellular therapies for autoimmune diseases. The company was formed in 2018 around a relatively elegant modification to the standard CAR-T19 approach that was used in cancer so successfully. It was spun out of the University of Pennsylvania. The initial platform, the CAR-T platform, we called it, is now referred to internally as our legacy platform. We've been prosecuting the clinical paradigm for that platform for some number of years. We've seen a safe profile, but not yet an effective profile, to treat pemphigus vulgaris and myasthenia gravis. We continue to run a single cohort in each of those two programs.
But about two years ago, we came across the paper that really has ignited the field of CAR-T19 in autoimmunity. And that paper caused us to ask the question whether that might be exactly what we needed in order to realize the vision for the company. So we went to an offsite, and we said: We have $120 million in the bank, you know, what do we do to cure autoimmune diseases and to lead that field? We ended up identifying the need to find a binder for CAR-T19 that would be clinically tested. That is to say, clinically demonstrated to be safe enough for autoimmune patients. And in particular, it would be great if that binder could be the human equivalent of the binder that was used in the academic study.
And lo and behold, we came across exactly that product. We in-licensed it in October of last year, and by then there were many reports, five patients had been confirmed to be long-term responders with CAR-T19 therapy, despite their refractory lupus that was unresponsive to all forms of therapy before CAR-T19. So, around October of last year, we completed that in-licensing agreement, and only five months later, the first IND was cleared. And the first IND was for lupus nephritis and lupus. That IND was followed six weeks later by a second IND clearance for myositis. And so we have a purpose-built product, one that is designed for autoimmune patients, to leverage all that is known about the academic clinical experience, which has been so safe, so durable, so excellent.
We're trying to leverage all of that with our product design and move quickly into the clinic for lupus as well as for myositis and many other indications to follow, in order to deliver on that first slide that's in our company slide deck since the day of inception, which is in order to ultimately develop and to deliver curative cellular therapies for autoimmune patients. So that's a summary of the company to start.
Yep. Maybe we can just focus on 201, 'cause that's obviously where investors are focused these days, and you're making great progress there. So maybe just talk about the different components of 201, and kind of what gives you confidence. You've touched on some of it already, but maybe you could just map out the different-
Yeah
... components there.
So CABA-201, our lead program, that is, as I said, has two INDs cleared in the U.S., was designed to be as close as possible in design to the academic product, which has delivered all of the safety and efficacy data that has ignited the field. And specifically, we chose to use a 4-1BB costimulatory domain because that's what was used in the academic study, and because in cancer patients, it's really pretty clear that a 4-1BB costim domain is gentler but still effective, versus a CD28 costim domain, which, in enough patients, you're going to start to see CRS and ICANS. And this is not our opinion, this is the collective literature in cancer, showing that the CD28 CARs are less safe, are more risky for patients than the 4-1BB CARs. So we chose a 4-1BB costim domain.
We also chose to use this fully human binder that is the fully human equivalent of the Schett binder. Schett is the academic who published these data. And, what that means is that we bind the same epitopes, and the functional bioactivity of our binder has been demonstrated in peer-reviewed, published literature to be the same as what Professor Schett has demonstrated with his binder. So we know the activity of our binder is the same, the design of our construct is the same, and therefore, it was really important to understand if that activity is the same, and we replicated that in-house with our scientific work separately from the published data.... So that replication of that data taught us that we have a product that might be the same level of activity as Professor Schett's.
So therefore, we know our starting dose for a fully therapeutic or a potentially fully therapeutic administration of CAR-T19. For those who are familiar with cell therapy, dose finding is a very arduous, very long path. It's one patient treated, wait a month, treat a second patient, wait a month. Do this until you get to the next dose level, and then do the same thing, and then go to the next level. Finally, you arrive at a dose that's good, and a year or two has passed. So it was critical for us to design a product that was easy for us and for regulators and for investigators to appreciate the likely safety profile of the dose that was being proposed, and to be able to start with a fully therapeutic dose that could potentially deliver on the promise of CAR-T19 for these patients.
We brought this to FDA in our IND filings. There was no discussion whatsoever, no debate over the starting dose. Unlike what we believe to be the design of every other competitive company, and as I think everybody now appreciates, everybody who can be in this field is now declaring they're in this field. These are companies that are doing dose-finding studies that just take time. In the meantime, we're doing a phase 1, 2 program in the U.S. for lupus and myositis. six patients in each trial, each arm of each trial, sorry. In the lupus program, we have lupus patients and lupus nephritis. Lupus nephritis is about 40% of the market. The other 60% is lupus. Professor Schett's patients were lupus nephritis patients, so we're trying to replicate his data in that arm. six patients treated.
Once we have the six patients, we would plan to go to FDA if the data support it, go to FDA and discuss the registrational trial requirements for lupus nephritis. On the lupus side, the same exact paradigm: treat those patients. To be clear, these are not the patients that Professor Schett has treated, but there's no reason to think they'll respond differently. What you don't know, you don't know, so we might as well, if we're going to expand or change the enrollment criteria, have that as a separate cohort. We're now in a position where we can enroll, theoretically, two patients per month, not one, and it's not sequential, it's all in parallel. As soon as the lupus IND was cleared, we understood what FDA had asked for.
We modified our already prepared myositis IND filing, and we designed the study almost exactly the same. Same therapeutic, potentially therapeutic starting dose, the ability to go up or down if we see that's needed, but potentially therapeutic starting dose, followed by, or including three cohorts. Each of the three easily, objectively identified subtypes of myositis are treated in independent cohorts, and, that program filed, only six weeks after the... I'm sorry, approved, cleared only six weeks after the lupus clearance, is essential. And I think it's only recently that investors are starting to appreciate the value of not only treating lupus nephritis, which is where some of the competition is limited by regulatory, approval so far. And it's not lupus and lupus nephritis, but it's myositis now. Myositis is critical because, number one, it's not crowded.
There's no other CAR-T19 product that we know of that is headed for or being developed in myositis. Number two, the patients have a profound unmet need. In lupus, there are many therapies that are effective, from steroids to, you know, a variety of products that have... Two products in particular, that the only two that have been approved by FDA in the last 65 years, they were developed by our Chief Medical Officer, who actually knows how to successfully develop through all of the challenges, lupus products. So we know that lupus has a lot of choices. Lupus patients have a lot of choices. In myositis, only dermatomyositis patients have any option that's FDA approved, and that's IVIG, at a cost of up to $500,000 per year.
So our thought is, we think about that, that purpose, the reason we exist is to develop and launch the first targeted curative cellular therapies for autoimmune diseases. The best way to do that might be to push as hard as possible and to stay in the lead in lupus in the U.S., we believe we are. We're six patients away from discussions with FDA about a registrational trial in lupus. But in myositis, you might end up with an open-arm trial, you might end up with a comparative trial, but you have no challenge to compete for patients because we're the only game in town. Our partnership with Professor Schett, which was so incredibly special when it was formed and continues to be robust. We published jointly recently on some findings that we had on his patients.
That partnership gave us early insight into myositis, so we started working with these sites in October of 2022, and it's almost a year now. We have the IND cleared, and we're making really good progress towards opening these sites. We think myositis might be the path ultimately to successful launch of CABA-201 as a treatment for those patients and potentially then subsequently for many other indications. I'll just close with a comment further about myositis. When you think about the timelines for endpoints, the only approved therapy, IVIG, has been approved based on a very short timeline of follow-up. It's only a 16-week follow-up. If I'm treating other diseases, maybe MS, for example, I need to show that over a year or two years or three years of follow-up, I've got an impact versus current standards of care.
Much bigger market, much harder path to be the first to launch in the category. So our plan is: be the first to launch and then execute like, you know, I can only give the example, execute like argenx. We talk about it internally all the time. There were a lot of FcRns. Argenx differentiated because they implemented impeccably well and strategically incredibly well. And we hope to emulate the sort of success they've had by just sticking to our knitting, doing what we do well, a great product design for autoimmune, a great team that has experience with lupus and other CAR T and autoimmunity for the last five or six years, the partnership with Professor Schett, which has given us the insights to design our trials properly and to do what we need to do, and now we're just out there doing it.
So we'll deliver our first clinical data, as we said, in the first half of 2024. And between now and then, as we didn't announce the IND for myositis was going to be happening, and we didn't announce it until it did happen, you know, stay tuned for what we will do between now and the middle of 2024, by which time we will have announced our initial clinical data.
Maybe back to your initial clinical data, first half of next year. I guess, what should we expect? Should we expect lupus and myositis, or just one of those? How many patients, how much follow-up, et cetera?
Yeah. So, we are engaged with dozens and dozens of clinical sites working towards opening. We purposely did not limit ourselves to one or the other of the five cohorts of patients that are enrolling, because I can't tell you what patients is going to show up first. And I want to be sure that we don't put any torque on the system. Like, we're just working as hard and as fast as we can. We're going to deliver at least a few patients for at least three months of follow-up in the first half of next year. They may come from the myositis only, they may come from the lupus only, they may come from a combination, maybe more than that. But that's sort of the thinking, right?
We need to deliver sufficient data, clinical data, biologic data, serologic data, perhaps radiographic data, as well as safety data with a three-month time point of follow-up. Delivering that to investors, we believe, for us and for investors, should de-risk the opportunity, and the assessment of the opportunity.
Can you maybe talk about what we've learned from the Schett paper, and do you view that as kind of the bar for lupus? Seems like it's pretty high. Do you need to, like, match that, or where's... Is there wiggle room there?
So, you know, I'll stretch to say that the academic reporting so far has demonstrated near perfection, right? There have been a couple of fevers treated with IL-6, not much else on the safety side, an ataxia that may or not have been in ICANS, but who knows? And nothing else that I know of on the safety side. On the efficacy side, durable, complete responses for up to two years reported publicly, and many, many patients now past one year, and unpublished data yet to be presented will, you know, show what happens thereafter. There's not a lot of room for upside on efficacy, and there's frankly not a lot of room on upside for safety.
When you go into a population of patients with either his brand of CAR-T19, which can't be developed from a regulatory perspective, but whether you take that product or any of the products in development, nobody's going to match perfection. We're going to have patients who are treated who simply don't respond, and we're going to have to figure out why. There are going to be patients who are treated, who have a reaction of CRS more than others. We have an incredible translational research group internally. We're not, you know, sort of partnering this out to somebody else. It's too important. You don't partner out the most important things that your company needs to do. You do your translational research in-house, and you figure out what's going on because you're the expert, and this is what we've done for the last six years.
In fact, Professor Schett, I remember sitting on a outside porch at our offices, talking about his desire to use our translational research labs for his patients. That's why we partnered with him. We said: "We don't want to do that because we don't want you telling everybody what we do before we're ready to talk about it." So we agreed he'll share his clinical data before he does outward to anybody else. We'll share the biologic insights from his patient samples that he sends us, and together we'll actually advance the field, and that's what we're doing. So feel good about, you know, the path we're on, the trajectory we're on.
In terms of enrolling the first patients, you know, what... You said you're looking at a lot of different sites. Are there any particular hurdles near term, or is it just literally executing at this point?
You know, every day is a hurdle. It's a battlefield out there. This is perhaps among the biggest pharmaceutical targets in the industry right now. Nothing's going to come close to obesity, probably. But just step back for a minute and imagine that you could cure most autoimmune diseases. Like, we have a slide that summarizes 40+ autoimmune diseases that could be addressed, and we don't know which ones will respond completely, partly, or not at all, but the magnitude of the opportunity is astonishing. How do you even think about the total addressable market? How do you address the addressable market? Like, these are, you know. So all we can do is execute. We have a very purposeful clinical strategy, regulatory strategy, U.S. and then Europe. Excuse me.
Focused on safety, focused on getting activity and then approval of the first product in the field with, you know, the ability to demonstrate value in the right study design, in the right patient population. Showing best outcomes versus the best standard of care. Then, broadening our portfolio so that one at a time with scientific rigor, not with, you know, a cancer-like, you know, sort of, basket trial. We're trying to stay very homogeneous populations of patients in whom we're talking about three, four patients, five, six patients. You want homogeneity of the patient type. The physicians we work with want this. They want to understand what's gonna happen to my patients if I bring this into phase 3, or I bring it to market, and I help you bring it.
Like, what, what are the safety data? So we've chosen to take a highly rigorous scientific approach. We think regulators like that. We think that it will serve patients and physicians we work with really well because they'll know what to expect with a greater fidelity, with greater degree of certainty, because we've done this in such a rigorous way.
It is harder to file many different INDs to study each indication separately, to build out all these trials, but it also is the fastest path to approval, and it's gonna serve us, I think you'll ultimately see, as having the broadest portfolio in the industry because we've started early and we've started often in terms of the IND filings and the ability to bring the same dose in all of these patients, building a safety database across all of the trials in order to bring that safety to bear on the relatively small, modest efficacy trials that are needed when you have curative outcomes. So if we have curative outcomes as the academic data, it's gonna be a pretty small bar, a pretty low bar, in terms of number of patients required to beat any standard of care in any of these diseases we talk about, right?
If you have 20% activity versus a 100% reduction in whatever it is, the statistics would tell you that you need 30 or 40 patients, and you're done. But you can't treat 30 or 40 patients and have sufficient safety to feel good about treating 100,000 patients, or 60,000 with myositis, or 300,000 with lupus. So you need more safety data. The way you generate that is across the portfolio, you've got the same dose in many autoimmune patients. So a lot of things to do, a lot of work to be done, and, you know, we're just head down, doing the best work we can.
Can you maybe talk about competition? Obviously, the Schett paper sparked a lot of enthusiasm and interest across the field and... So maybe just your thoughts there, and how do you continue to stay ahead of that or even potentially compete with, you know, large pharma, as you-
Yeah.
sort of pointed out?
So we're looking to expand our lead. Some have said, "How are you gonna, excuse me, how are you gonna leapfrog, everybody else?" Right? Because they're already gonna generate safety, so, safety data. So you're gonna start to see some early reports, case reports, from maybe Bristol or Novartis or Kyverna or whoever else is in the field, generating initial clinical data. The vast majority of that data will be from Europe. You know, the overwhelming majority of it will be a phase 1 dose-finding study. We should be asking: At what dose are you seeing these things? You know, what's the full profile that you're seeing? Are you seeing activity and efficacy along with the safety that you report? Like, we should all be asking those questions.
As a company, we won't be presenting initial clinical data before we can give you a full profile of the efficacy and the safety of the product so that you can reach conclusions, and on the efficacy side, clinical, biologic and serologic, as well as maybe radiographic data, so that you can really understand what's happening to the patients and reach your own conclusions as to whether the therapy has worked. So our intention is to bring all of that to bear. Competitively, it will appear that we're not in the lead, but there is no other company that we know of that has a phase 1/2 trial, as designated by FDA, in lupus or myositis. In fact, there's nobody who has anything going in myositis in the U.S., to our knowledge.
So we feel really good about the fact that we are in the lead in the U.S.. We will not be delivering the earliest or first initial clinical identified patients who responded or were safe or whatever is reported. We think it's great for the field, that there's so much effort being put towards it. We think all boats rise with this confirmation of the academic data. The only thing we care about is launching the first product in the field and then having a broad portfolio of safe and durable outcomes. So there are three things we focus on as a company: the launch being early and first across the finish line, and then the program being very broad and providing safety, durability of treatment effect, and a patient experience. We don't wanna have...
You know, it's not just about like two-day manufacturing or six-day or four-day or nine-day. That's all trivial. What matters is: What's the patient experience? And we've recently added, as some of you may know, Shawn Tomasello, who was the Chief Commercial Officer at Kite from, not inception, but from early days prior to launch, through the launch of Yescarta, and it was her leadership that led to that now being the vast leader in the market for CAR T nineteen... and through the acquisition by Gilead, she was there. It was the ability to to deliver an exceptional patient experience that helped that product deliver on the promise of the opportunity.
So we're gonna not reinvent the wheel where it's not necessary, but we will deliver a patient experience that is second to none, and we'll do it with a product that we think is designed to be the safest product in the field. It has a knowable profile. We're not using some new manufacturing processes that haven't been studied in thousands of patients. We're using plain old, straightaway, autologous CAR-T19. So we think our odds are good. We like our profile. We think that regulators will continue to respond to the data that we submit, and we think we have the opportunity to leverage the academic experience with three-month data from the academic world and our world, if it is similar. Given our product design, we're gonna begin to think about whether the long-term durability is actually just gonna replicate what the academics have seen.
So if we look a lot like those academic data in the early days, I think there's some read-through across. I'm not so sure that a more persistent, faster manufactured product from a competitive standpoint is not going to lead to more B-cell aplasia. So B cells return in these patients, which is remarkable, between 3-7 months when you're using a 4-1BB containing CAR that has a murine version of our human binder. So what's been reported, 3-7 months out, the B cells return, and it's a naive population with no evidence of disease. If I give you a more persistent CAR that has a longer persistence, I don't know... Well, it's not gonna give more efficacy, 'cause right now, the data reported are 100% effective and durable for as much as two years.
There has been no failure, so improving efficacy is not what's needed. A more durable, more persistent product might be great in cancer, but in these autoimmune patients, I want my B-cells back. And if more presence and more prolonged presence of CAR-T product is going to delay my return of my B-cell population, I'm not sure that's a good thing. And I'm not sure regulators wouldn't want to really fully understand whether that's the case. So from our point of view, you know, the design of our product, the implementation of our trials with the wisdom of the team, and a relentless pursuit of launching the first product in the field, the broadest portfolio, safety, durability, and the patient experience, that's the recipe for success.
Maybe just one last question here. Seems like you've done a lot to try and de-risk this first readout. So where do you see the biggest risk? Is it for some reason, dose might not be correct, or there are other areas?
You know, I think the unknown unknowns is our risk.
Right.
That and the ability to meet the market demand at launch. So I think we're gonna cross the finish line first. We are not going to allow it to be the case that we cross the finish line first, and we cannot meet the market demand. And the solutions for that range from everything from stepping into the shoes of one of the many cell therapy companies that can no longer afford to have manufacturing capabilities and taking on those facilities that are built and already manned, modifying them to our needs and bringing them into our trials. All the way to partnering with CDMOs, as we have recently announced we did with Rentschler, doing that in Europe or in the U.S. with a second CDMO.
As well as partnering with one of the many strategics, both in two buckets, right? One is on the cell therapy side, and the other is on the autoimmune side, each of which have a different level of evidence required to get very excited about engaging seriously to spend the money required to enter this field. But all of which are gonna have to seriously consider whether curative outcomes for patients who they currently treat with annual therapy is a field they need to get involved in. So there's plenty of opportunity. We're going to be, you know, proceeding in parallel with all of the six strategies that we've identified internally to meet the market demand. It is definitely an unknown for Cabaletta right now.
We haven't declared, and we will declare at the right moment, what our manufacturing strategy is to scale innovatively and to lead that field as well. So, stay tuned.
Okay, great. Looks like we're just out of time. Why don't we end it there? Thanks so much, Steven. Appreciate your time.
You as well. Thank you.