I'm going to get started continuing day one of our Cantor Annual Healthcare Conference. I'm Josh Schimmer, one of the Cantor Biotech equity research analysts, and very pleased to introduce from Cabaletta Bio, we have Steven Nichtberger, President and Chief Executive Officer, David Chang, Chief Medical Officer, beside him, Gwen Binder, President of Science and Technology, and right beside me, Samik Basu, Chief Scientific Officer. We had a whole agenda planned prior to two weeks ago, but that got a little disrupted with some of the updates from competitor autologous CAR-T program. We're going to focus really heavily on that update and what separates Cabaletta's manufacturing approach to CAR-T.
First, Steven, maybe just kick things off, give us a quick snapshot of where Cabaletta is advancing rese-cel auto CD19 CAR-T for autoimmune diseases, and whether there are certain areas that you think investors should be paying attention to but are not.
Yeah. So, thanks for having us, Josh. It's been an exciting two weeks. Patients simply want to be off of their medicines and free of disease. The only modality that's been able to deliver on that promise since 2022, when the first data was published, is the autologous CAR-T product space. rese-cel, as an autologous CAR-T product, was designed specifically for patients with autoimmune disease. By that I mean we use a standard, well-characterized, nine-day manufacturing process. We use a 4-1BB-containing, fully human binder, and we use weight-adjusted dosing. These are actually aspects of our product that are just about unique in the autologous space and very similar to what Professor Schett did at Erlangen, which is why all of us are so excited about the field.
Because we made these choices early on, with a high insight and regard for patient safety in autoimmune disease, we've now published a bunch of clinical data. What does that data show? It shows that we can provide reliably and durably the vast majority of patients who get a single dose of rese-cel when they discontinue their medications, all of their immunosuppressants, are never going to take another immunosuppressant for as long as we have been following them. They'll also reduce their steroids oftentimes to zero, and if not, almost always to less than physiologic doses. As a product offering, because of the efficacy, we now need to look at the safety. The choices we made in our design of the construct have paid off dividends for patients. Our safety is beginning to differentiate in highly meaningful ways.
In over 60 patients reported, we have 94% of all of our patients either have no CRS at all, or a minority of that number have a fever, Grade 1 CRS that is transient. 97% of those 62 patients that we have published and reported have no ICANS at all. There is no case of IEC-HS, the outcome that caused Novartis to pause their clinical program. There is no case of IEC-HS in any patient at any time in the rese-cel program to date. That does not mean it will never happen with us or any CAR-T program, but we think the design choices we have made have truly minimized the risks, and you will hear a lot about this, minimized the risks of all safety events that we know of. What that has allowed us to do is create a pipeline in a product.
As we go forward, the remainder of this year, you can expect us to start our second indication on a pivotal pathway to approval. Scleroderma, 12-year mortality risk for a 30 or 40-year-old person who is diagnosed with scleroderma, in 12 years, there is a 50/50 shot they are alive. There is real urgency, and there are no treatments. That is in addition to, by the middle of next year, we expect to report out the pivotal program on myositis. Because of our safety data, and our weight-based dosing, which is, we think, unique in the field, we have been advancing aggressively our pediatric myositis program, which we will file, we anticipate, by the end of 2027, along with our adult myositis program.
We are excited about that because, first of all, nobody else can even begin to go after it. The safety profile has to be there. You need weight-adjusted dosing. There is a moat around the entire pediatric universe for us. The other reason we are excited is there is the possibility of a voucher with that pediatric filing if it is accepted. After that, we have innovations coming like PC-free, which is a terrific upside to expand the market opportunity, as well as an approach to eliminate the need for apheresis. To close in these comments, I would say our vision of what rese-cel will do is patients will come in with a safe opportunity to reset their disease, to be free of drug and to be free of their disease.
All they need to do is come in, donate blood, in a regular whole blood draw, allow us about a month to turn around their product, their cells for them, and on an outpatient basis in a clinic, be infused on one afternoon, and then go home off of their immunosuppressants. I would ask you to think about that promise versus any other modality, which is multiple infusions, multiple reconditioning, whatever it is. Ask yourself if you would rather have that or anything else that is in development. We are really thrilled with the opportunities that we have been given because of the choices that the group here has made early on in our development program.
All right, excellent. Thank you. Now, given how topical it is, let's double and triple click on manufacturing. We had a wonderful conversation last week where the team really helped me understand fast CAR-T manufacturing and the risks that come with that versus the standard approach. I think you kind of know all the questions to be asked because we had such a wonderful discussion. Maybe you can summarize for this group now these key takeaways, because for me it was so important understanding how Cabaletta's been able to avoid all the landmines that are out there if you drift off the right path.
Yeah. I can start, and then I'll pass it to Samik. I think first, we really want to communicate with everybody what is different about our product and our manufacturing process. As Steven mentioned in his opening comments, our process is a nine-day process. That means that the cells are modified and then they're expanded ex vivo, and during that time, the cells change their characteristics. This nine -day process is the same as all of the approved CAR-Ts. All of the approved products like Kymriah and Breyanzi, they all use this type of process. All of the clinical data, safety data that's out there is characterized with this type of process. Also, as Steven mentioned, we use this process because this is what also the Erlangen group used. It allowed us to move quickly. It allowed us to leverage learnings from that group.
Also, we were very aware of, and Samik will talk more about this, we were very aware of differences between oncology patients and autoimmune patients, and that's one of the learnings we really want to communicate with you today. When you look at the process that Novartis and BMS have used in autoimmune disease, they're using shorter processes. Specifically, Novartis uses a two-day process, and BMS uses a five to six-day process. The cells have less time to grow, and they have less time to change and differentiate. That correlates with very specific changes in biologic behavior that actually have been published by Novartis themselves. They published a paper outlining the preclinical validation of their product that they're using in autoimmune patients that had the deaths. Their two-day process was directly compared using the same donor match material with their Kymriah process.
The cells have approximately 10 to 15-fold higher levels of interferon gamma, which is a pro-inflammatory cytokine, than the Kymriah cells. In cancer, you really want to have more pro-inflammatory cytokines because you want to create inflammation in the patient because that helps support the anti-tumor effect. But it's exactly the opposite in autoimmune disease because they're already revved up immune systems, and you don't need that extra pro-inflammatory kick in order to get to that efficacy. I think that's a good time to turn over to Samik because he can talk about the influence of interferon gamma on monocytes.
Yeah. Let me just back up a little bit. The inflammatory adverse events, think CRS, ICANS, IEC-HS, they are all mediated by macrophage activation. For those who are unfamiliar, macrophages are a subset of white blood cells in the body. They are primarily involved in phagocytosis and presenting antigen to other immune cells, particularly T cells. With the interferon gamma that Gwen mentioned, that binds interferon gamma receptors on these macrophage cells, and those cells then secrete IL-6 and IL-8, and that is what mediates a lot of these inflammatory adverse events. In autoimmune patients, the macrophages are already very polarized, very pro-inflammatory to begin with, and so they are more likely to make even more IL-6 and IL-8 in response to interferon gamma.
When you have higher amounts of gamma, let us say with a short manufacturing process, you have even higher levels of IL-6 and IL-8, thereby increasing both the grade and the frequency of these inflammatory adverse events. It is really connected to the manufacturing process, these inflammatory adverse events.
But for the rapid manufacturing approach, why is not the higher cytokine release per cell not just simply offset by delivering fewer cells?
I can start, and Samik, please add. These earlier cells are more stem-like. They have more proliferative potential. Again, it is really important to remember with these therapies, they are living drugs, so when they go into your body, they continue to expand, they continue to grow, and they continue to have biological effects that go just beyond their target. Novartis' product will expand far more. This has been shown in their studies as well. You can repeatedly rechallenge these cells with antigen, and they will be able to react once, twice, three times, four times. Whereas cells that have been products that have been grown for nine days, you can only restimulate a few times. These cells can grow much more, and they are still reacting to antigen.
It might take a little bit later for them to get the peak expansion, but they still get to the same effective dose.
How many patients have you treated now? What's the denominator?
We've reported on 63 at EULAR, and now we're beyond 90 that we've treated to date.
Specifically, we tend to like to put our safety data into medical meetings, but in light of the events of last week, we have said publicly that in over 90 dosed patients, we have never seen an IEC-HS event in any patient at any point.
To what extent do you think the connectivity of Cabaletta to UPenn, which has just played such an important role in CAR-T, has that been instrumental to keeping you on the right path, or is that not a factor that's helped differentiate Cabaletta?
UPenn has been a truly fabulous partner, supporting our manufacturing in the early days. Our intellectual brain trust starts with Gwen as one of our earliest hires, trained, not trained, but worked at UPenn with Carl June in the 1990s, 2000 period. David trained at UPenn. Samik, all of us have UPenn. I do. We all have UPenn roots. Truly, Josh, if I am to say as clearly as I can, the intellectual honesty and the data integrity of the three people sitting between you and I are the reason that rese-cel is breaking away and differentiating. It is the choices that were made when everybody said, "Small company, and they do not even have fast manufacturing, so we could take a long time to get the cells to the patients." All we cared about was patient safety and doing what we know would work.
It is just a beautiful thing to watch, from my point of view, to see that everything that Samik taught us about macrophages in 2023 is actually true. We see the experiment living. It is nice to see, and it has implications for not only the choices we are making coming into this moment, but as we look forward to how this field is going to evolve and what role we can play in it, how we use rese-cel, how we dose it, and then beyond rese-cel, what else we do, all of it is being informed by these same individuals and their teams, I would say.
Excellent. A remarkable team. Absolutely. Okay, so even before the Novartis manufacturing related fallout, there was a little bit of a kerfuffle between Bristol and Soliris, which is one of your top manufacturing partners, a little bit of they said, they said going on in terms of Soliris' readiness for prime time for scale-up. What is your take in terms of how is Soliris performing? Is there any red flag here for us to be attentive to as a result of some of the Bristol commentary?
Maybe just a quick comment. Then Gwen can speak to how the relationship is going from a manufacturing standpoint. Before they announced the termination of the relationship with Bristol, they called us and flew out to meet with us, flew across the country to meet with us. Their redesign as a company was, I would say, strongly influenced by the conversations we had about what we needed to be sure that we could be fully supported in everything that we needed going forward. So, we are confident that the data that we have seen on rese-cel and its manufacture, our confidence remains unwavering in that. We have dosed patients successfully, feel good about that, and feel good about the prospects going forward. Maybe, Gwen, you can speak a bit more to the relationship.
Relationship. Yeah. We think Soliris are fantastic partners. I will say what we did with Soliris, and this has now been published, is we basically took our current process that is at Lonza, and we performed tech transfer of each unit operation, and they were able to replicate each one of those steps. We put it all together. We did a comparability evaluation that showed that the product being produced with the Soliris automated machine produced a product that was exactly comparable to the product that is produced by our CDMOs using our commercial process. We then treated two patients with that process, and Samik and his team performed translational evaluations on those patients, showing that the PK/PD in those patients, the cytokine profiles, were exactly the same.
We view Soliris, and actually the FDA also, because we just submitted them as an addendum to our existing IND, see this as a completely interchangeable manufacturing process. So, we know they're capable of being able to provide product. We're very excited about the prospects they bring us as we start to ramp up in our commercial phase.
Right, and you recently signed a [crosstalk].
We don't know why Bristol terminated. We do know that Breyanzi, the drug that was being produced by Soliris for Bristol, or the intention of that partnership, Breyanzi is an incredibly challenging drug to manufacture, which I think was the basis for their partnership to begin with. But the reasons why they terminated are unknown to us. All we can speak to is we have confidence in our data with rese-cel in their system, and it is a nine-day process, the same as our usual manufacturing.
Coincidentally or not coincidentally, you also recently signed a collaboration with ElevateBio to be an alternate CDMO. Can you talk a little bit about the rationale for forging that relationship and what they can bring to Cabaletta that may complement Soliris?
Yeah, I am happy to talk about that. Since the very beginning, I have always had a philosophy that you never have a single source manufacturing supply. I am very happy that at Cabaletta, we have always made the investment to make sure that we have two suppliers at all times. In terms of our process B, which is our commercial process, we currently have it at Lonza, and we thought bringing it into a second commercially proven CDMO was important with ElevateBio. We have been really pleased with the collaboration, the tech transfer, the comparability studies have gone really smoothly, and we are excited to be working with them so that we can maintain that second source of supply.
Are the economics meaningfully different? One of the advantages of Soliris is the scalability and affordability of the approach. Can ElevateBio?
Yeah. Soliris brings us scalability and the flexibility to get there at among the lowest cost of goods in the industry. Really interestingly, there is an oversupply of autologous CAR-T capacity right now in the world. That has played in our favor and in favor of anybody doing autologous work right now. More pointedly, the fact that we have so many choices as to manufacturing rese-cel, the fact that we have a safe drug that looks to be, or emergingly safe drug, as the data suggests, that looks to be a winner, each of the manufacturers are working hard to outdo the next as to supply, as to price. All of the parameters are improving because everybody wants to work with Cabaletta on rese-cel. It has all worked in our favor. I want to be clear, there is another path we could have taken, right?
Which is a single source manufacturer, do it easy, do it simple, and hope that you have enough when you launch. We are here to serve patients, to serve them well, and to grow this business into the first truly successful autologous CAR-T company. To do that, you have to have redundancy on manufacturing, you have to have scalability, and you have to have a low cost of goods.
Yeah.
Another common topic that comes up with investors is the importance of a preconditioning-free regimen, almost really distracting, I think, from rese-cel as it is currently. Maybe you can talk to first, how important is it to be able to drop the preconditioning component, and does the answer to that depend on the specific disease indication we may be talking about?
Yeah. It is very interesting. There are many parameters that affect enrollment and intention to use data. The most important right now might be that three people died with an autologous CAR-T from Novartis. That has been, frankly, in-house among our greatest concerns and our greatest opportunities. Because in the public media, the headline is, "Three patients died with an autoimmune drug from Novartis." Oh, that is the same category as those others. Hmm, I do not want that. I do not feel well, but I do not feel that bad. Managing the information that investigators have, we have reached out to every one of our investigators. We have also reached out to all of the relevant Novartis and Bristol investigators.
If they would like to have an option to use rese-cel, we would like to partner with them. I think that is the number one concern and opportunity, right? Because if you are a patient and you want this therapy, there used to be three choices, actively enrolling trials. Now there is one, right? There are others, but in meaningful ways, with 100 sites or more and that kind of thing. It is an issue to manage, and it is an opportunity to take advantage of. In market research, the number one improvement that patients would want to see and that physicians would want to see is if you could get rid of the preconditioning, that would be terrific. Right?
Knowing that and knowing that with our legacy portfolio, for those who know us for quite a while, the CAAR- T platform, totally different from rese-cel. We have the world's best experience, honestly, over five years of developing products without precondition. We know what the body is doing in an autoimmune patient with CAR-T cells when they're administered with no preconditioning. That is what caused us, after we had the data with preconditioning, to seek to remove the preconditioning. It is the most important thing that you can do. Being apheresis free is interesting, but it's not a driver. Being outpatient is a very important factor, extremely important. To be outpatient, you have to be safe enough to be outpatient.
To our knowledge, among the major players in autologous CAR-T, which we've discussed, we're the only ones who have in our protocol, which has been FDA reviewed and is cleared and is enrolling in our protocols, the opportunity to treat patients on an outpatient basis. Why does that matter? Number one, capacity. We're talking about numbers that are far larger than oncology. There aren't enough inpatient beds, and we're not going to fight with oncology doctors and their patients to win over the oncologists to take those beds. We have to be outpatient. Why? Because there's plenty of outpatient opportunity. That's the first is to achieve the full capacity of rese-cel, we have to be outpatient. And we have to publish data before we launch on the safety and the approach that one would take.
The second thing is reimbursement. Reimbursement if you are a Medicare patient. Most patients in autoimmunity are going to be commercial pay, but if you are a Medicare patient and you are an inpatient, you're in a DRG reimbursement system, and if you are an outpatient, you're not limited to a DRG reimbursement. That is important in the differential between, or in the opportunity that administrating centers would have to administer therapy. The limitation of supply of inpatient beds and the limitations on reimbursement are both factors to consider when you think about where you want to go in terms of the evolution of rese-cel as a product. Get rid of the preconditioning. Very important. We're working on that.
It is not necessary that we get rid of it to be wildly successful for an autologous CAR-T company, but it allows us to capture far greater depths of each population and some very large indications that are yet to come.
On the topic of preconditioning free, some of the advantages of the preconditioning, depleting B cells so that there may be less cytokine release syndrome, preventing flares. In theory, you don't need cyclophosphamide and fludarabine to accomplish that. There might be alternative reconditioning regimens that are more acceptable or tolerable. I guess two questions there. How do you think about the trade-off of dropping it to expand the potential of the platform versus what might result in more CRS or flares? Why don't we start with that question.
Yeah. Boy, did we debate this for, two years, three years ago. We debated this a lot. At the end of the day, let's see if we can hit the grand slam first. The grand slam is rese-cel is quite safe, differentially safe, with preconditioning in over 90 patients now. Therefore, we can go without preconditioning, where you have two, three, four times more B cells that you're killing. So, you're going to produce more cytokines if you're killing more B cells. You have to be very safe without preconditioning to venture into that space where you have a PC-free regimen.
We've gently advanced the dose, and we're starting to see, and in due course, we'll present a body of evidence that'll make it clear that it's either a viable and a very interesting product, or it's not in each of the indications we're pursuing. If that does not produce the results that we would like to see that are acceptable to patients, sure, we could add Rituxan, or you could add some drugs alongside, but then you're confounding your data in terms of the outcomes data. You have to have control arms, and you have to have much longer follow-up because rituximab alone is going to make you look pretty good for six months or whatever it is. So, it's an outstanding question. It is a great opportunity if our grand slam does not hit.
Could you use the cells as preconditioning, meaning a lower initial dose to help deplete the B cell burden and then come in with a higher dose to mop things up?
Sort of what the bispecifics are doing necessarily.
Yeah.
Right. One dose, outpatient, no preconditioning, and no apheresis is the vision. We are, if anything, persistent. We're going to get there.
All right. Final minutes, we've got ACR coming up. What should we be looking for there and then over the subsequent 12 to 18 months?
Yeah. We're very excited about ACR. It's a meeting that we've gone to for several years now. We hope to be able to present additional data on all of our programs, depending on which presentations and abstracts are accepted. Dermatomyositis, scleroderma, lupus, we'll look at that. But I think we will certainly want to highlight the safety aspect of our product, which we've been talking about since we submitted abstracts. But in addition, because of these events that have been reported, there's an additional layer of interest, and I think we'll be able to continually convey the message of safety with our product.
Yeah. For the things to look forward to in terms of items that investors would tend to be interested in. By the end of the year, we intend to initiate our second pivotal program in scleroderma. That's a 25-patient, open label, single-arm study looking at patients who have scleroderma and ILD, so the lung disease being the primary endpoint. That's a disease where the lung disease has never been improved by any therapy. There are approved therapies that can reduce your rate of decline as you head towards death, but there's nothing that has stopped the disease in its tracks and allowed you to improve your lung function. In addition, by the middle of next year, we expect to present the pivotal data on myositis, and that'll include the pediatric pivotal data on myositis, which we think is very important.
By the end of the year, filing of the BLA in adult and pediatric myositis with the prospect of a 2028 launch, including, if approved, the potential for a priority review voucher.
Excellent. I think we're pretty much at the end of time, so I want to thank the Cabaletta team for joining, for the progress that you've made, and for staying on the yellow brick road to autologous CAR-T success and autoimmunity.
Thanks.
Thanks, everyone.