G```ood morning, everybody, and welcome to the Guggenheim Healthcare Innovation Conference. I am Lerma Khayati, one of the analysts here at Guggenheim, and it's my pleasure to introduce the next fireside chat with the Cabaletta Bio. From the company, we have Steven Nichtberger, the President and CEO; David Chang, Chief Medical Officer; and Steve Gabel, Chief Commercial Officer. Welcome, and it's a pleasure to have you here.
Thanks.
So before going into details across the different programs, of course, Cabaletta had an amazing year, a lot of progress recently on the clinical side, regulatory front, and now we will discuss with Steve also on the commercial side. But Steve, why don't you orient the audience first and give us a brief overview of all the recent progress and tell us about the key milestones we'll be watching for in the next months?
Great. Thanks for having us. So as you may know, Cabaletta was formed solely for the purpose of developing and launching the first targeted curative cellular therapies for patients with autoimmune disease. In the past three years, since the IND was cleared for ResaCell, we have enrolled 75 patients. We have 75 or more sites opened already, and we've reported some transformative clinical data across five different indications: myositis, systemic sclerosis or scleroderma, lupus, myasthenia gravis, and pemphigus vulgaris. In the past month, we've specifically presented data at ACR on three different indications. The first, myositis, where all of the patients from our Phase I-II program who were enrolled and dosed with ResaCell, who would have been eligible for our Phase III or our pivotal protocol, all of them hit the endpoint that was agreed with FDA. So we have alignment with FDA on our Phase III program in myositis.
The patients who we have presented from our Phase I-II program look like they would hit the endpoint in the case that they were in the Phase III or pivotal protocol. We think that's important data that de-risks the pivotal protocol. In systemic sclerosis, we see similarly profound treatment responses in patients off of all of their immunosuppressants, off of their steroids or on low-dose steroids. Very promising data in another area where there are very few therapies available, and those that are available have limited success. In lupus, patients with lupus and lupus nephritis demonstrated, again, off of all medicines or on no steroids or very low-dose steroids, patients demonstrated Doris remission or objective evidence of renal response in all of those patients.
So we're seeing this sort of profound treatment effect with ResaCell, this very carefully designed product with a fully human binder and a 41BB co-stimulatory domain, both of which are designed to maximize the safety while delivering the efficacy to these patients. And we use the drug in a weight-adjusted dosing regimen, which we think partly explains the exceptionally strong early safety data that we are showing in the first 32 patients recently at ACR and before that at ESGCT. And as well, the final thing that we've recently presented is in pemphigus vulgaris without the need for a preconditioning regimen. We did the study that perhaps nobody wanted to do, right? Which is, what about the cells alone? If I just give you a single infusion of ResaCell, no preconditioning regimen whatsoever, nobody would imagine that might actually deliver efficacy.
Patients, two out of three of them, demonstrated complete elimination of their B cells in a routine assessment of their periphery. And in the case of clinical response, one of them had a PDAI score that was in the 80s, which is extremely high. It only goes up to about 100, all the way down to three. So within a month or two of therapy, we saw profound clinical responses in the patients who had substantial B cell clearance. So we are hopeful that the no preconditioning approach with rese-cel can give us durable outcomes in pemphigus, but as importantly, transferable observations to the other indications that we're pursuing, because we don't know if it's durable yet at this dose, and we don't know if we can transfer that observation into the other indications that we're pursuing.
We've embarked on a strategy that allows us to explore a number of doses in lupus, because we think in lupus, a no preconditioning regimen will be highly valued by patients, many of whom are of childbearing age and perhaps would appreciate the option to go without a preconditioning regimen. We're pretty excited about the progress we've made, even more excited about what's yet to come. The registration cohort for myositis is due to open for enrollment and start enrollment this year on schedule. We expect by the end of this year to also have FDA alignment on scleroderma or systemic sclerosis, as well as on our lupus program.
Three potential pivotal programs with FDA alignment, and we will identify in the coming months what our priorities are and what will be the second indication that we will prioritize in a pivotal program, with the first being myositis, the second being either systemic sclerosis or lupus. Very excited about the past, even more excited about the future and the opportunity to bring functional cures to patients.
Thank you for that wonderful introduction, Steven. Maybe let's start with myositis, where you already got a very favorable alignment with the FDA for the registration program. This is quite different from other programs, standard phase III programs in terms of size, even the endpoint. You have an endpoint of 16 weeks. Can you first maybe also, David, tell us about the trial design, how unique that is? What are the key differences compared to other trials that have been run historically and that are currently doing? How were you able to achieve such a favorable alignment with the FDA?
Yeah, David, do you want to take?
Yeah. So one of the key components that really makes this unique is the endpoint, as you pointed out. It isn't just patients got better, right? So it's a composite endpoint of a total improvement score, which is the clinical score, but that's combined with the discontinuation of all immunomodulatory medications. And the third component is on low dose of steroids. So if you put all three of these together, not only does it make it a more objective endpoint, but it also makes it a more stringent, meaning that it's harder to hit. So if there were a placebo group, placebo patients are not going to be able to hit that very easily off of immunomodulatory agents on low dose of steroids plus getting better, right?
So that's one unique aspect compared to other typical studies that makes this a more objective and more stringent endpoint, making it more highly probable that we would hit that endpoint. The second thing that we are doing something is to be very efficient, which is to say that we aren't doing a very large randomized controlled trial, but we're doing this controlled study in a way that we're looking at our patient in a single arm trial, but using an external database to create that control group. Now, the key thing here is to make sure that we address a few things that are going to be an issue, and we've all heard about this. One would be confounding, and second would be bias, because it's an open label in our study, and you're using an external control, which is also done at a different time.
It's a different database. So what we are doing is paying very, very close attention to how we do this with a high level of rigor. So that means that we're going to pick a very good registry. We're going to pick patients that are going to be almost identical as possible, inclusion-exclusion criteria matched as close as possible, and we're going to pre-specify it. So you can't start the study and say, "Oh, I saw some data. I'm going to go back and change something." You pre-specify the analysis plan, the statistical analysis plan. You have the protocol ready. You have the statistical analysis plan ready, and you do that before you start the study. And so that would increase the level of rigor, reduce the confounding and biases that you run into when you do an open label study and use an external database. But I think doing those things are going to ensure us with a higher probability of success and having the regulatory approval with the FDA.
So to expand just two other points I'd like to make, they're, I think, both very important when you try to risk assess what Cabaletta's regulatory alignment is versus the recent experiences of a couple of other companies that have been pretty high profile in their being surprised by the regulatory outcomes. So the first is the transformational responses that are unprecedented in each of our programs. We're not talking about slowing the progression of an untreatable disease and making it progress at a less fast pace, which was the case in one of those two. We're talking about functionally eliminating the disease totally while you're off of medicines. The magnitude of treatment effect warrants a single arm open label trial with a comparator. The magnitude of treatment effect is foundational to everything that we have as our clinical strategy, and it's been foundational to our discussions with FDA.
The second thing I'd like to say is this is not a one-time alignment with FDA and we're done and we're just going to close our eyes and go forward. We've had the usual sequence of interactions with FDA, most recently August of this year, so only three, four months ago, where they looked at not our conceptual design of a study, which is what you tend to find alignment on, and then you submit your protocol. Well, what they did is they commented directly on our actual protocol, and their comments led us to the conclusion that we do have alignment on everything that we have said we have alignment on.
The comments they made were all of a relatively trivial nature, and these comments were from today's FDA, if you will, as of August of this year, and they were with eyes wide open, not miscommunicated about some strategy. It was on the actual protocol that they were commenting. So for these reasons, none of us know what FDA will do. They can always do whatever they want, but we do feel comfortable that we have heard what they've asked for clearly and that we are following the letter of the law when it comes to the timing for the SAP to be in place, the timing for the registry to be defined, and the nature of the registry. We think we're dotting all the i's and crossing the t's. Well, we don't know what we don't know, but we feel good overall.
Steven, just a clarification on that point. Have you already discussed the statistical plan as well with the FDA, or are you going to present that?
Yeah, so we have discussed with the FDA that we will have a statistical analysis plan in place before starting the study.
Got it. And in terms of assumptions for the background rate, what are your estimates and what's the margin of error that we can imagine based on the kind of inclusion-exclusion criteria that you are using in the pivotal study?
Yeah, so we haven't discussed the specifics of what those numbers are, but as Steven had alluded to, we have to assume that our treatment is going to achieve a fairly high response rate, right? Even off of medications on low-dose steroids. We've seen that with the SHAT data. We've seen that with our data. So we have to assume our response rate will be fairly high. The question is, what would the background rate be? And without going into details, I could say if you had a patient with severe active disease in myositis on medication and you stop that medication, what happens to that patient? The patient will get worse, right? At best, they stay stable, but likely they get worse, right? So if you think about what is the likelihood of a really high background rate, it's going to be not very high.
It's going to be very, very low. So off of immunomodulatory medications plus getting better and on low-dose of steroids. So that's going to be very low is what we have estimated. But once we get the registry data, we'll have a more precise estimate that can compare exactly or as close as possible to our patient population.
And if the background rate were as high as 10%, how many patients out of our 14 would need to be positive?
I think we need about five patients or so that.
So very well powered.
Yeah. Assuming that even a really conservative estimate for our side, for our drug, we're not talking 90%. Let's say it's lower than much lower. We still think that we would have a positive study with, say, about five patients or so.
Got it. And on the safety side, that was a pretty best in class, I would say, for your drug. And you got a very, yeah, certain.
Nice of you to say. It's early days, but we feel good about it.
Yeah. I mean, it's been standing out in the class. And you got a favorable alignment as well. Where are you standing there with the registry for the safety data, safety database?
Yeah. So the database, that the alignment we received with the FDA definitely confirmed on this one was we talked about having 100 patients with at least one month's worth of data across all of our reset program. So it's not just in myositis, but it's in lupus, myasthenia gravis, systemic sclerosis. And the reason behind that was because, again, we're using the same weight-based dosing regimen. It's not different. Same preconditioning regimen. And we believe that these are patients who are similar in terms of what happens to their B cells. So if the B cell quantitatively, qualitatively, and location-wise, those B cells are B cells, whether it's in a lupus patient versus a myositis patient. Therefore, 100 patients across all of our program safety database was thought to be acceptable and aligned with the FDA, in addition to us having 35 patients in the myositis group. So as Steven mentioned, we're about 75 patients enrolled already across our reset program. So that's not going to be holding us back on the BLA.
Awesome. Okay. So moving on now to scleroderma. Of course, terrible disease, huge unmet need, but we are seeing also data from other programs. You have pretty remarkable results, but I would like to hear from you how do you contextualize your data versus the competitive landscape and the standard of care?
Let me make a broader statement, which is efficacy among autologous CD19-directed CAR-T products that are properly dosed and administered with preconditioning is indistinguishable. There's not one drug among the CD19s in cancer that has a distinguished efficacy profile. And I think there's not one in autoimmune that is going to emerge as distinctively different or better than the others. So the differences will be in safety. I think it's very heartening to see Bristol-Myers present data that looks a lot like our data when it comes to the efficacy profile. I think the safety profiles of everybody's drugs will speak for themselves, and we're pretty happy with our safety profile overall.
And you're going to have a discussion with the FDA for the registration program in scleroderma as well. What can we expect there in terms of trial design? Will it be like one-arm study or if you can orient us a little bit?
Yeah. So for the other, so we're talking about systemic sclerosis?
Yes.
Yeah. So in that disease patient population, we would try to pursue the same strategy as we have with myositis because it's a rare, serious disease, unmet medical need, no therapies available. Now, there are drugs available just for the lung component, but remember, scleroderma is a disease that affects the entire body: lungs, heart, skin, et cetera. So we believe that it's a serious unmet medical need that could potentially follow the same pathway strategy that we have done with the myositis program. Yeah.
Yeah. And two things I would add. Unlike myositis, where there was an example of a 16-week approval process for IVIG in dermatomyositis, in scleroderma, one-year endpoints are the norm. There is not an example of a very short approval timeline or follow-up of a primary endpoint in scleroderma. And the second thing is there are other companies pursuing scleroderma with randomized controlled large trials. So I don't think until we have our final discussions and outcomes from our FDA meetings, I don't think we can rule out any of those possibilities.
And one last thing. So one year, that could be the way that the FDA thinks about it because the two approved drugs for the lung component are one-year studies. And FDA likes to fall back into position of comfort. So they say, "Well, we know one year. We know lung disease. So we'll have to have that discussion." And that's certainly a possibility that they say one year, we like lungs, but we'll try to pursue an expedited pathway as much as possible.
Excellent. And another important result that you disclosed recently was with an open conditioning approach. So that's a paradigm shift in a way from what we know. And can you give us a sense of the importance of that? And we'll discuss more on the commercial side because there are implications there. And when will we see the next data and in which indications?
So listen, we're in this incredible moment where if you have an autoimmune disease, it's not unlikely that you can achieve a functional cure. For those of us who trained in medicine when we trained long ago, this is an unbelievable moment. So being able to do it at all with autologous CAR-T plus preconditioning is of greatest interest right now to patients and the key opinion leader physicians. And increasingly from ACR, I can tell you it's going down into the broader population of physicians now, the interest. But every company is shooting their best shot towards this really remarkable outcome and trying to deliver data. The no preconditioning data in Pemphigus where initial dose without any preconditioning, a single infusion, which could be on an outpatient basis, you come in, you get infused, you go home. That's what our data suggests is possible.
If that happens, the implications for all of the other autologous companies where they're going to have to match the safety and the efficacy of Rezacel and as importantly for all of the other modalities. Just think of it for a minute. If I use an allogeneic product, I'm using preconditioning unless I'm using multiple gene edits, and that's a whole different can of worms. If I'm using a bispecific, you'll come in today and you'll come back next week and maybe a third week after, and after four doses, you might actually have a result. One and done is what Rezacel was able to do with the Pemphigus patients. What about in vivo? In vivo is multiple infusions over multiple days or weeks.
Again, the autologous Achilles heel of the business model, which I think maybe would be good to talk about for a moment, has turned into this sort of superpower where a single infusion can actually deliver the results without preconditioning. If that is transferable, if it is durable, it changes everything for everyone in this industry. And I think it's recognized to be that important, but none of it is proven yet. We don't have the durability. We don't have the transferability yet, but that would be the implication.
Exactly. So what's very interesting here is to hear about how are you thinking about the commercial strategy. And Steve, you joined the company recently. So why don't you introduce yourself, tell us what brought you to Cabaletta, and express your vision?
Yeah, sure. Hi, everybody. I'm Steve Gavel. I'm Chief Commercial Officer here at Cabaletta. Before coming to Cabaletta, I was running the commercial program over at Legend Biotech, where I was the commercial development lead for Carvicti. Before that, I was working at Celgene, and I was leading the commercial development program for, at that time, BB2121, which is now known as Abecma. So I've been around the CAR-T space for quite some time, and it's really a pleasure now to move out of cancer CAR-Ts and into autoimmune therapies. And I think I'd like to talk about, because one of the reasons why I came here is in terms of what I look at as being the key differentiator.
I listened to this conversation up front here to remind me of other conversations I've been part of where we sat around like this and talked to a bunch of investors, whether it be through an IPO or not. And we talked about this amazing clinical data that CAR-T therapies represent. And when you take a look at the CAR-T therapy launches and do a postmortem on them, most of your peers and friends of mine would say, "Were they successful launches or not?" And most would say, okay." The Carvicti program, I think folks point at as being sort of the one, maybe the bright spot in the product launches. But let me just for a minute talk about the reason why I came here was really the business model.
Because if you look at those prior CAR-T therapies and start to dissect what went wrong with them, it's not about the clinical data. The clinical data is phenomenal. And I agree with Steven, the CD19s in particular, and I've studied them. There's not much different there. Where these products broke down, and it's something that's exciting to me coming back now into CAR-T and autoimmune, is that the areas that it broke down were in two areas. One's internal cost for the drug developer itself, and we could talk about that in a second. And also just the limitations that CAR-T products have for the treatment of cancer in hospitals, especially in a Medicare environment. It really put a lot of stress on institutions in terms of making the financials viable for them without getting into too much detail in the interest of time.
Looks like only about a minute and a half. This patient population that we will be treating is young and relatively healthy. That's unbelievable for CAR-T therapies. That represents a lot of opportunities for us, not only in the manufacturing setting in terms of how successful we'll be at manufacturing drug product within specification. That's been a big drag on the industry up to now. So we're very excited about that. And also the site-level economics. We are going to take a bit of a page out of my playbook from the Carvicti program and put it on steroids. The thing about Carvicti, because of that, our safety profile was very, very good. We even have a much better safety profile with this program.
We were going to rapidly enter into the market through our hospitals because that's what the clinical footprint is today, but very rapidly move into the outpatient setting. And then from the outpatient setting in our hospitals, take the next step and get into the community setting. That's going to rapidly happen with this program. That's going to allow us as manufacturers to treat, again, more and more patients over time. It'll accelerate throughput in our hospitals. And also there's pricing flexibility that allows us, quite frankly, in our setting that we didn't have in launching cancer products. So our value proposition, again, comparatively speaking to cancer-related products, will be far superior to what you've seen historically. So sorry, I kind of ran on there, but I was also looking at the CAR-T.
Thank you for the time. Thank you so much.
One question. How should we think about the price in the context of INI? Because some of these areas that you're going after are obviously niche, but the prevalence is in the 10,000- 30,000 patients.
Yeah. I think Steven pointed out earlier, I think you look at historical therapies that have been used to treat there with the IVIG is one of those examples. And that's where we're basically directing our attention in terms of creating our value proposition is if you could, like Steven was talking about, eliminating those therapies over time in these younger patient populations, our value proposition is significant. So you're anywhere in the neighborhood of up to 200,000 to 450,000 to 500,000 per year. And these drugs are dosed really through the lifetime of these patients. So if we could, like you said, one and done, eliminate that, that becomes the proxy or the comparator to look at as opposed to maybe some of the other auto CAR-T therapies in the market.
Steve, one more point. Could you also touch, given your experience with Carvicti, what work from the CMC and manufacturing you need to do here? Because you're going to be in the launch phase in the next two years or so.
Yeah. And these folks could weigh in on it as well. The other reason it attracted me here is basically our supply schedule in terms of what we're doing with Lonza upfront with the CDMO and looking at other options over time as we scale potentially. But I think from that perspective, so it's more of a CDMO play versus what you're talking about where we were owning the manufacturing process, which is extremely expensive. One thing I do want to point out though, it's related to manufacturing, and I commented really briefly on it, is the amount of out-of-spec waste that occurs and the cost associated with that is significant for manufacturers. I can't stress that enough. We do not see that with this program.
And that was something that caught my eye, and that also has downstream drag on your P&L because as a commercial leader, as we are manufacturing out-of-spec product, I cannot bill for that product. So we're incurring all this cost. Patients, thank God, are being treated, but the manufacturers are a bit paying a penalty in the sense that we cannot recoup that cost. So I want to make sure that's an important component that we stress here because we don't see that in this particular program.
Thank you so much. I think we are out of time.
Yeah. Sorry. Thank you.
Thank you.
Thank you.