All right, good afternoon, everyone. Thanks for joining us here at the Leerink Partners Global Healthcare Conference. My name is Tom Smith. I'm one of the senior biotech analysts here at Leerink. It's my pleasure to welcome our next company to the stage, Connect Biopharma. I'm really happy to be joined up here by CEO Barry Quart. Barry, thanks for joining us.
Thank you very much. Thanks for allowing us to come and present. Really excited to tell the Connect 2.0 story. First of all, it's probably important to highlight that the company's had a complete change of management in the last eight months. It's been an extremely exciting time for me after 40 years in both biotech and large pharma to come into what I think is one of the most exciting opportunities that I've seen in a very long time. I think before we go into the usual kind of fireside chat, I wanted just to take a minute to go through some of the key highlights of the company to put everything in perspective. Our primary activity right now is the further development of Rademikibart.
Rademikibart is a next-generation IL-4, meaning it's the next-generation Dupixent, obviously a highly successful drug and very important therapeutic product. What we found in phase 2 study in asthma with Rademikibart was a really quite remarkable improvement in FEV1, amongst the largest increases in FEV1 that we've seen with any biologic. What was particularly exciting was how quickly that improvement was observed. We saw quite dramatic improvements in FEV1, basically overnight, from the first dose of the product, which opens up the opportunity to go after a complete white space in terms of the use of biologics. That is in the treatment of acute exacerbations. You have over a million asthma patients and over 1.3 million COPD patients going to emergency departments every year for treatment of an acute exacerbation. Very large market opportunity.
Those patients are still receiving the same treatment they would have received 20 years ago. They get prednisone and an inhaler. Unfortunately, while that gets most of those asthma patients out the door quickly of the ED and more than half of the COPD patients, they tend to have another recurrence within the next four weeks. In fact, almost half of the patients will have another recurrence during that next four weeks. Why that's important to the hospital, because we always have to think about who the payer is and what's going to drive them to buy a drug, is that the hospital doesn't get paid again if the patient comes back in that four-week period. They have a vested interest not only to do well for the patient, but also to avoid having to treat that patient another time or two on their own nickel.
There is an opportunity to really improve the outcome for these patients in that four-week vulnerable period. We have already demonstrated with rademikibart, as I mentioned, very fast onset. We saw a very good reduction of exacerbation. We have a high likelihood of success during that four-week period. We know a single loading dose covers the patient for that period. It opens up the opportunity to go after this untapped market. It is important to note that both Dupixent, as well as all the other biologics that are approved for asthma and COPD, in their label, it explicitly says, do not use for treatment of an acute exacerbation.
If we're able to obtain a label with an indication for acute exacerbation, not only would it be a highly unique, differentiated indication, all of our competition says explicitly, don't use it in that setting, really setting up the opportunity of owning this space. The thing that we found that was particularly unique is that having that unique indication of acute treatment also differentiates the product in the mind of the clinicians, such that they now view it as a highly differentiated product. They've indicated to us, 75% of the time, they would take that patient who received it acutely and continue treating them chronically. It's a way to get patients on your drug, get them started treating chronically before they ever have a chance to see our competitors. It's a really exciting opportunity to break into a highly valuable space with essentially zero competition.
We think that that lack of competition is going to continue out into the future because all of the drugs coming behind us are really focused on longer half-lives, long-acting. That's the mantra for the products coming behind us. We all know that from standard pharmacokinetic principles, the longer the half-life, the longer it takes to get to steady state. It is highly unlikely those drugs are going to work in the first 24 hours or even in the first several weeks. It is an opportunity to really own this space for a very long time. Within the next few months, we'll be initiating two parallel phase 2 studies, one in asthma, one in COPD. These are four-week studies. The great thing about this is a very rapid development process, not the usual two, three years to do an asthma or COPD study.
We're starting these studies in a few months. We expect to have data in the first half of next year. Because they're relatively fast, they're also much cheaper than the usual studies. We're able to, with the cash we have on hand, fund these trials and still have a runway into 2027. With that as the intro, love to.
That's perfect.
Let's go through any questions.
Yeah, thanks, Barry. You mentioned you kind of led off with being relatively new to the company, bringing in additional leadership. Maybe if you could just, to use a baseball analogy, kind of talk through, I guess, what inning we're in in terms of having the right people in place and feeling like you have the right team around you to pursue this strategy.
I think we are about 95% there. There's potentially an opportunity for probably one additional add to the senior management team. We have truly replaced almost everybody on the management team that was there previously. It is not to say that it was not a good group. They had a different skill set. The board really set out to really change the orientation of the company. That includes making the company more U.S.-centric. As a foreign filer, the company put out information to investors twice a year. We are going to be filing our first 10-K at the end of this month and then start to put out the normal Qs into the future. Investors will start getting information on a quarterly basis, like they are used to for any other San Diego-based biotech. That is our goal.
At the end of this year, I want people to perceive us as a San Diego-based biotech with a small outpost in China versus a Chinese biotech with a small outpost in San Diego. We are almost there. I will say that it has been a very rapid and pretty efficient process because everybody who we have brought in has worked for myself and/or David Szekeres, who came in as President at the same time. These are people that we have worked with over the years, some of them for over 30 years at many companies that have a long history of success. I personally have brought nine drugs to market over my career. We have a great group of people who know what they are doing.
Got it. That makes sense. You described Rademikibart as this kind of like next-gen Dupixent. You alluded to some of the clinical data that we've seen in the asthma studies that give you some confidence in that. I guess we just take a step back and just look at the compound itself and how the compound itself stacks up to Dupixent. Are there certain aspects of the pharmacology that are better? Does it have potentially better potency? How does the half-life compare? What is driving that potential differentiation?
Yeah, a great question. We, in fact, just last week, there was a poster presentation at a dermatology meeting looking at the structural biology. It shows very clearly that we have about 30% more hydrogen bonding to the ligands. We definitely have a different product than Dupixent in terms of the structure. We bind differently. We have more potency if we look head-to-head in cell culture. Half-life, a little more difficult to give details on because the half-lives of these drugs are dependent on the drug level. There has never been a half-life published for Dupixent. What I can say is that both companies have attempted to do atopic dermatitis studies during the maintenance phase of randomized patients to stay on Q2 weeks, to go to Q4 weeks. In the case of Dupixent, I think they even tried to go to Q8 weeks.
Patients in the Q4 week and Q8 week groups with Dupixent failed pretty quickly. There was a big difference between those and the patients staying on Q2 weeks. Conversely, in our study in AD, patients were randomized to either stay on Q2 or go to Q4. Q4 looks exactly the same out to 52 weeks as the Q2. We believe we have a longer half-life. That has not been tested in the asthma setting. It was tested in AD. We think there's an opportunity to extend the duration of dosing down the road. It's something we'll be looking at over this year. We've got basically kind of about a year and a half before we'd be prepared to go into phase three studies for chronic dosing. We have FDA clearance to proceed. We're on hold ourselves until we have the acute data. That's twofold.
One is, obviously, large chronic studies are expensive. We want to be good shepherds of the cash that we have on hand, as I mentioned. Secondly, ultimately, one can perceive a phase three program that combines these two indications, start the patient for acute treatment, and then two weeks or four weeks later, start chronic dosing. Kind of have an acute to chronic approach for at least one of the phase three studies, maybe do independent studies for the second phase three confirmatory study. We really need the acute data to kind of know what to do in terms of phase three for chronic.
Right. That makes sense. OK. I think you characterized there being a lot of white space here. It is a very, I think, unique novel approach to drug development. Yeah, there really hasn't been much development work that I'm aware of in the sort of acute asthma, acute COPD space, maybe just in terms of market sizing and the number of patients admitted. Maybe you could just help kind of frame some of that up. I'm sure that is part of what drew you to these opportunities.
Oh, absolutely. I mean, that was obviously part of the underlying rationale for why we're doing this is because, A, there's an unmet need. And it's a big one. In fact, in the asthma setting, as I mentioned in the intro, there's over 1 million emergency department visits a year for asthma, acute exacerbations. For COPD, over 1.3 million. What's intriguing is that you see almost the same numbers in Europe as well, remarkably similar. This is definitely a global issue. There really has not been very much attention to it. In fact, again, it's quite interesting that in the development pathway for all the other biologics, they exclude this period, this one-month period that we're about to test. They exclude that from their phase three trials and phase two trials for that matter.
In order to get into their chronic studies, you cannot have had an exacerbation in the last month. That's exactly the period that we'll be looking at where you have high vulnerability to another exacerbation. Half the patients will have another exacerbation during that period. If you think about one of the challenges of doing asthma and COPD studies, exacerbation is the endpoint. You have to follow hundreds, if not thousands, of patients so that you have adequate power because your control group has an annualized rate of one exacerbation. You are showing you cut that in half or 60%. You are talking about a baseline of one. We are talking about a baseline of half the people failing. Much greater opportunity to show statistical significance with a smaller set of patients.
Yeah, that's great. Let's, I guess, talk about how you're thinking about trial design and targeting the patients. I imagine one of the challenges in doing pretty much any clinical study in this acute setting is the patient enrollment and figuring out patients come in, treated typically with standard of care, getting things like consent, patient consent to be enrolled into a clinical study ahead of time seems like it would be a particular challenge. How are you thinking through, I guess, some of the logistical challenges and making sure you get the right patient population in there?
Excellent questions. Being first at something is great from a competitive point of view, but it adds an additional layer of challenge, no question about it. We've been able to spend the last eight months really drilling into all of the logistical issues. We're fortunate we've got a great group of advisors, some of whom have recently conducted a similar investigator-driven trial because, again, the pulmonology community is desperate for more tools to use for these patients. On their own, some investigators initiated a study in the acute setting in asthma and COPD patients and demonstrated that Benralizumab reduced the rate of treatment failure over the following three months. Great study to follow gives us a huge amount of information and comfort in terms of the baseline rates, but also gives us a lot of data on how to conduct the trial.
The other thing that's interesting about that study is that it also showed, as we would have expected, really no benefit for about three weeks. Then you start to see a very nice separation. That's exactly what I was mentioning. Drugs with long half-lives, particularly several months, take a while to get to an effective level. We know we have activity within a day. We expect to see a much bigger separation and that separation to start early. One of the things that we identified exactly, as you mentioned, doing studies in the emergency department are challenging. We have identified a CRO that has the best experience in doing this. We have worked out plans for several different approaches to enroll patients and work through these with the FDA. Some of the patients are going to get enrolled at the ED.
We'll have certain centers that have good collaboration with the PI and the other clinicians that work in the emergency department. Some patients are going to get pre-enrolled. What that means is every pulmonologist has got those patients that they just know they're going to have an exacerbation in the next year. Either they're not ready to go on a biologic, they don't want to take a shot, or for whatever reason, they haven't started more aggressive treatment, but they have a high likelihood of having an exacerbation. We're going to enroll those patients into the program, get the informed consent, do all of the work in advance, and then give them a card that says, hey, when you have an exacerbation, call this number, come to this clinic, you'll get treated.
That is the way that in the study I mentioned, it's called the ABRA study, they were able to enroll most of their patients through that route, which is a very unique approach and gives us a higher level of comfort that we'll be able to enroll this study as planned and have data first half next year.
That makes sense. Yeah, to the extent that you can pre-qualify patients and almost pre-consent them. Yeah, that makes a lot of sense. OK. I guess one of the other potential challenges when I think through a development program in an acute setting is maybe the standardization of the background standard of care because, of course, you're going on top of standard of care, bronchodilators, steroids. Maybe you could just talk about in the locations where you're executing these two studies, how standardized is that? I guess is there any additional either training or other kind of standardization protocols that you're putting in place that's specific to the study that help make sure that the care that's received in kind of both arms is relatively balanced?
Yeah, great. Another great question. I think what we found is for asthma, everybody follows the GINA guidelines. And truthfully, they follow it everywhere in the world. It's pretty interesting. So pretty standardized treatment for these patients. You said steroids, beta agonist inhaler. The one thing we did find that's going to be probably, I almost say, the most challenging, but certainly from a standardization, extremely important is not everybody gets a blood test before they get treated because we know emergency rooms are chaotic. The goal is to get the patient to start breathing better as quickly as possible. That's really important to us. We want to make sure that we only enroll patients that have appropriate eosinophils, steroids, reduced eosinophils.
In order to make sure that we get the right patients and get as many patients as possible, we want to get that blood test right away. It is one of the things that we're trying to standardize at the sites that we're going to: hey, maybe only half your patients are getting the blood test before you start dosing them. You need to pull a sample from everybody. Even if you don't run it, store it. If they enroll, then if they're willing to enroll, then fine, we can go ahead and run it and make sure they qualify. Let's make sure we get that sample so that we can at least find out. That is probably the biggest issue of standardization. Otherwise, from the asthma patient point of view, not really problematic.
The COPD patients, we know these patients are going to be more complicated. They come in with more other either metabolic or other disease-related issues. The instigating factor may be an infection. They are going to get treated more aggressively. About half of COPD patients that go into the emergency department end up being admitted. From the enrollment point of view, a patient that gets admitted is great. I hate to say that, but it makes our lives easier because they're a captive audience in order to get enrolled and informed consent, et cetera. The issues of standardized treatment is nothing that we can control. These patients are going to be treated appropriately for the symptoms and the disease level they have.
We are just going to have to hope that there is enough activity with the product that it overcomes whatever minor differences that the treatments may impact. Given that nobody has ever done this kind of trial before from a drug sponsor point of view, we have also built in an interim analysis so that halfway through the study, we can take a look and make sure we have powered it correctly, that the underlying control group is having the kind of rate of exacerbations that we projected, that we are seeing the rate of difference that we projected, and make sure that we have enough patients in the study. If it turns out that there is more variability and therefore we need to increase the N, we will make sure that we have a successful study.
Yeah, it's good to have the flexibility built in there. OK. You've talked about enrolling patients as early as next quarter. I guess what are the gating factors to getting both of these studies off the ground? Are there additional regulatory conversations that need to take place? How does the CMC look, I guess, to be able to start both these studies?
Yeah, so one thing that the company has done exceedingly well is manufacturing of this product. The manufacturing was developed in China but has been transferred to a U.S. manufacturer. They've now run multiple successful batches. We'll be using material coming out of that U.S. manufacturer for these studies. The drug's available, the protocol is, in our view, done. It's just moving through the usual logistics of setting up a trial. I think we've said publicly that we were having a type C meeting in order to discuss this with the agency. We are still waiting for the minutes from that. We have not yet put out a press release on the results. Unfortunately, obviously, there's a little chaos in Washington. Things are slightly delayed. We anticipate getting those minutes any day.
Be on the lookout for a press release. As I said, our expectation is we'll be starting enrolling patients in the next few months. I think you can take from that it was a positive meeting.
Understood. Yeah. And just when I think about, I guess, the timeline then over the next 12 to 18 months, it sounds like confirmation of the regulatory, trial initiation, dose first patient. I guess if you could elaborate a little bit on the interim analysis. And you probably won't have much greater precision once you start enrolling patients to get a sense for how enrollment's going. But if we're talking about potential top-line data in the first half of 2026, I guess I can envision this interim taking place in second half 2025. Just, yeah, I guess if you could elaborate a little bit on the interim and what kind of update or news flow we could get from that.
Yeah, I think that we haven't made a final decision. My general preference and I think appropriate approach would be it's unlikely that there'll be any significant data that comes out of that interim analysis that becomes public other than the study continues or if we're increasing the sample size by something significant. If we're going to over-enroll by 10 patients, I don't think we're going to turn that into anything significant. If we need to significantly increase the N, I'm sure we would make that public. Otherwise, everything's go and we continue to enroll on schedule. Timing of the interim analysis, let's talk in a quarter or two. As you say, let's get the sites going. Let's see how things go. I mean, I'm very encouraged. The clinical team's always hold on. It's not going to be that easy. Give us time.
I'm very encouraged by the fact that there are no competing studies. We are not competing with 10 other sponsors looking for a patient who's stable to go on to the next trial.
Our handful of patients.
Yeah. This million asthma patients a year, year in, year out, they're going to be there. There's nobody else trying to get them on a study. In fact, as I said, they're excluded from every study. It is perfect.
Right. I guess with respect to the top-line data releases, maybe you could just talk about how you're sort of framing expectations for that. I don't know if you've been explicit around powering assumptions, but just how you're thinking about the expected treatment effect that you would see in both studies.
Yeah. Just in general terms, we're using the expected control group results from both the ABRA study, which is a very contemporary assessment. They received the same standard of care, steroids and beta agonist inhaler. Independently, we've been trying to understand the rates in the United States. All the published data came out to 20%-30% of patients come back to the or hospital in that four-week period. We went further and got access to a database of over 100 million patients and found that, sure enough, about 50% have another exacerbation. It looks like we're pretty confident in the control group based on everything that we find here, as well as the ABRA study. I think we feel very comfortable we'll see that in the trial. We're just simply looking for a 50% reduction.
I think we'll see more based on the data from the ABRA study. If we start showing a benefit on day one, I think we have a great opportunity to see a larger decrease. We want to be very conservative, make sure no hiccups in these first trials. We took a very conservative approach of just a 50% reduction. There are also other important pieces of information that we'll be looking at because it's not only the treatment failure reduction. With the extremely rapid onset, we think there's an opportunity to show airway improvement. There's an opportunity for patients who don't improve enough with normal course of steroids, and they have to have a second course of steroids for that initial index event. We think we can reduce or eliminate the need for that.
In hospitalized patients, we'll be looking for that ultimate health economic endpoint, the gold standard of reducing length of stay. Because if patients are breathing better, we feel like we have every reason to believe that they should be able to get out sooner. I'll just highlight in our prior trial, obviously, these are not patients having an exacerbation. These are pretty standard asthma patients. We saw really quite remarkable increases in FEV1, much larger than what's been published with other biologics. If we can see this kind of magnitude of improvement in airway function, we have high confidence we'll see that result in patients getting out sooner.
Got it. This has been great. Unfortunately, we're a little bit over time. Barry, thanks for joining us and sharing the updates. Big year of execution for the company. We'll stay tuned.
Thank you very much.
Thank you.