Okay, great. Good afternoon, everyone. Welcome to Oppenheimer's 36th Annual Healthcare Life Science Conference. My name is Andreas Argyrides. I'm one of the senior biotech analysts at Oppenheimer. Today I have the pleasure to be joined by Connect CEO, Barry Quart. Connect is a clinical stage biopharmaceutical company dedicated to transforming care for asthma and COPD, with lead asset Rademikibart, a next-generation, potentially best-in-class antibody designed to target IL-4Rα. Great to have you with us today, Barry. With that, I'll let you take it over with the presentation. If there's time, we'll have some Q&A at the end.
Sounds great. Thank you very much, Andreas. Great to be here today. Appreciate the opportunity. Obviously, we start with forward-looking statements. We'll get right to the meat of it. This is kind of the usual 10,000-foot view of what we are doing and have done with Rademikibart, which, as mentioned, is a next-generation IL-4 receptor alpha humanized monoclonal antibody. We have completed studies in both atopic dermatitis and chronic asthma. Our partners in China, we've licensed the product to a large pharmaceutical company in China for all rights in Greater China. They've completed Phase III atopic dermatitis study and are currently conducting a chronic asthma study.
With all that in the background, we are conducting two studies in a very novel indication of acute exacerbations of asthma and COPD. I'll go through with you why we are interested in this market opportunity and why we believe that Rademikibart is ideally suited for treatment of acute episodes, as well as linking that ultimately to a chronic indication in both asthma and COPD as well. Starting with the market, you have large numbers of patients with asthma and COPD in the U.S., large numbers elsewhere in the world. This is a global issue with definitely high numbers in Asia and Europe because of histories of smoking.
We see that around 40-ish% of patients in both of these diseases have exacerbations every year, sometimes many times a year. Millions of those patients end up in the ER or hospitalized. That's really just the tip of the iceberg, 'cause you can see here that with a million emergency department visits for acute asthma exacerbations, there's multiple times that going to urgent care and doctor's offices. Very large numbers of patients having significant acute exacerbations. They're being treated the same as they would have been 30 years ago. No innovation in this area, no biologics approved or really developed in this area. Similar numbers in Europe, as I said, a global issue.
We believe that there is a huge opportunity for a new product to really own this market. I won't go through the biology of an IL-4 per se, but I will talk about the unique attributes of Rademikibart in terms of a very different binding location and orientation. We hit very different epitopes. We bind closer to the active site and more tightly, and because of that, we see significant differences in the profile that I'll talk about in a minute.
I also want to point out that the two cytokines that we target, IL-4 and IL-13, intimately involved in respiratory issues, with IL-13 specifically being shown to not only directly produce contraction in smooth muscle in the lung, but also what we see as a really important component of treatment, is that IL-13 also dramatically shifts the efficacy curve of beta-agonists, making them less effective. As such, one of the things that we've looked at is how we impact on these effects of the cytokines. First, talking about the binding of our drug versus Dupixent, that difference in binding results in a substantial difference in internalization of the drug-receptor complex, meaning there's less receptors on the surface. That also results in greater turnover, higher apoptosis.
That difference in terms of internalization, greater turnover of eosinophils, results in a very different profile clinically. When we look at asthma patients, over 24 weeks, what happens to their eosinophil levels? Now, remember, these drugs work preferentially in patients with high eosinophils. We work at down to about 150 eosinophils. Dupilumab is around 300, is where they start to see good activity and above. We see with dupilumab, and it's been published extensively, is that they increase eosinophils further. You see substantial numbers of patients running into very high levels of eosinophils. With Rademikibart, we see actually a decrease in eosinophils. Nothing like you see with an IL-5, but we do see a decrease in eosinophils.
We believe that's clearly related to differential binding, different turnover of eosinophils because of the internalization. I'll point out that this is not just a laboratory abnormality. You have almost 1,000 serious adverse event reports, specifically, you know, to FDA FAERS database in asthma patients for eosinophilic-related serious adverse events with dupilumab. We should not have that liability. Going back to the mechanism of action of the cytokines in terms of their impact on the airway, we've looked at the activity of beta-agonists, how they work, and looking at how we might be able to benefit that reduction that's seen with the cytokines that I've showed you.
We see in cell culture, looking at human airway cells, a clear benefit of adding Rademikibart along in situations where there's IL-13, IL-4 present, we improve airway function where you don't see that same situation with Dupixent. Cell culture is nice, but looking at human airway slices, here's that shift in the dose-response curve of a potent beta-agonist, formoterol. You add Rademikibart in this lung slice, and you see a return towards baseline of the beta-agonist. We allow the beta-agonist to improve bronchodilation as it should be. You see almost no effect of dupilumab in this assay, which we found very surprising, but also obviously very exciting.
We found another lab that does human airway slices, and we found exactly the same kind of picture, where, in this case, with the addition of IL-13, you see the dose-response curve for formoterol. The lower curve, addition of dupilumab, had no effect, but addition of Rademikibart at any of the doses tested, you see a clear, statistically significant improvement in the beta-agonist bronchodilation. Therefore, we believe that we have, in this particular disease state, a very different profile than dupilumab. That potentially is related to the clinical observation from the previously conducted phase IIb study in chronic asthma. Here is the picture of the FEV1 improvement in the patients receiving Rademikibart.
Much higher overall improvements than we see with other biologics. More importantly, at one week, our first clinic visit, you see highly significant improvement in airway function as measured by FEV1. With data from home spirometry, we find that almost all of that benefit was already observed the very next morning after the dose. In less than 24 hours, you're seeing very significant improvements in airway function, which is exactly what led us to start thinking about treatment of acute episodes, where you need something that works quickly. This is just a comparison of airway improvements across multiple products and different mechanisms. As you can see in the far right, being able to compare apples to apples, we see the greatest improvement with Rademikibart.
In terms of the timeline to that benefit, I find it very interesting that this is a snapshot of the Dupixent website. The best that they can say in terms of onset of effect is some people felt the symptomatic improvement in as little as three days. Given that they have daily home spirometry, that tells me they don't have that same rapid onset of airway benefit. In terms of another differentiating point, in atopic dermatitis. We ran the same trial that was done with Dupixent, 16-week induction at Q2 weeks dosing, and then randomizing patients to Q2W or Q4W for the rest of the study.
You can see that we maintained activity, in fact, almost a really improved activity on the left panel, whether it be investigator assessment or EASI-75 with the Q4W dosing. We think that the product can easily be used Q4 weeks, based on both PK from sub-Q dosing, as well as the benefit of that greater internalization. There's less receptors on the surface for a long prolonged period, which gives us a longer durability. You can see that here, whether you're looking at, again, the investigator assessment or looking at EASI-75.
Dupilumab, when attempted to be used Q 4 weeks in the shaded area, you can see on the both the lefts of each of the assessments, there was a clear loss of activity. We don't see that at all with Q 4 weeks. Based on the improved profile, and this very intriguing rapid onset, we've initiated two studies, one in patients with asthma having an acute exacerbation, one in patients with COPD. These studies are enrolling. We anticipate results mid-year. The endpoint here is treatment failure.
One thing that we identified of keen interest in patients going in the ER or hospital with an acute exacerbation, is almost half of those patients either come back to the ER or seek medical care elsewhere, because they are either not getting better, get worse, or they get better for a short period and then have another exacerbation. This was identified as well in a recently published study. It came out just as we were designing and finalizing our studies. This was done by investigators in the U.K., using benralizumab to test the hypothesis that a biologic could be beneficial in patients having an acute episode. Two important take-home messages here is that we see a very substantial treatment failure by four weeks with patients, again, coming back to the ER.
By the way, hospitals don't get paid again, if patient comes back in four weeks, so they have a vested interest in maintaining these patients, well and not having them come back. We see about a 45% treatment failure rate at four weeks, very similar to what we had anticipated. You see benralizumab really had no benefit in treating the acute episode. You do see a nice reduction in new exacerbations, over time. Again, another indicator that Rademikibart is unique in terms of rapid onset of effect.
If we can see 100-200 mil improvement within several hours, and definitely over the course of a few days, we believe that that will have a profound effect on the course of therapy of that patient and hopefully keep them out of the hospital, and prevent them from needing additional courses of prednisone. We are just completing an IV study, looking at speeding up the onset even more, by getting the drug into the blood right away. We've completed the first phase, which was to see the safety and PK of IV administration.
We found we could administer the product as an IV push, very safely, and are conducting a assessment, very small numbers, just to look at PK safety and collect FEV1, in small numbers of asthma and COPD patients. This data should be available this quarter, and the goal is to see whether or not we see improvements in FEV1, faster than what we see with the subcutaneous administration. We're certainly hoping that we start to see benefit within a few hours.
We've done extensive market research, with that market research, what we found is that there is keen interest in using the product for acute treatment of patients having an exacerbation, 40%-45% preference share in people not receiving a biologic already, which exactly the kind of patient we're looking at. That drives significant interest in keeping the patient on once they receive the drug acutely, with 75% of the time, clinicians wanted to maintain the patient on the same drug chronically. Having this acute indication not only allows us to basically have a completely open market with no competition. The biologics approved for asthma COPD all have a warning in their package insert that says, "Do not use-
... to treat an acute exacerbation", so there'll be no substitution or potential competition in that acute market. Having that acute indication has a remarkable effect on driving sales in the chronic business. We are very excited to continue to prosecute this indication. As I said, we're expecting the acute data midyear, and we're ready to go Phase III. we already have agreements with the FDA Phase III program for chronic asthma, and we'll be meeting with them as soon as we have the acute data. We'll also have Phase III study being done with our partners in China, completing near the end of this year.
We believe that the chronic opportunity could be achieved with very little additional work, and the acute studies are very fast and much cheaper. Overall, a very rapid opportunity for a huge market, long exclusivity, looking into the early to mid-2040s. We have enough of a balance sheet to get us there. We have cash into 2027. When we look at the catalysts coming up, the preclinical studies that really help identify some of the clinical observations we just talked about, and we put that data out early this year. We'll have the IV pharmacology data, which I think is gonna be very exciting coming out in the next month.
Looking forward to midyear, we should have the completed Phase II acute studies, and potentially an approval coming midyear to third quarter of the drug for atopic dermatitis in China. We have significant milestones due to us. There's about $110 million in milestones left in our agreement, and significant tiered royalties. We're very excited for our partners to achieve approval of the drug in China. With that, I'll turn it back over to Andreas, and happy to answer questions.
Thanks, thanks, Barry. Maybe just maybe, I don't know, maybe one or two, depending on the time here, but. Can you, can you quantify maybe on from a dollars perspective, the exacerbations opportunity? With a successful Phase II completed, what are you thinking Phase III? what are the requirements? There's been some new FDA guidance there. You know, just a couple thoughts would be helpful.
Yeah, sure. We've done several series of market research. The forecast for peak sales for acute and chronic indications, come out to upwards of $5 billion for U.S. and global markets. A very significant market opportunity, and that's just for asthma, COPD. It doesn't include the potential to bolt on an AD indication or any of the other indications that an IL-4Rα could be useful for, which dupilumab obviously has several, but there's many more beyond that. A lot of commercial opportunity for what we think is a modest amount, because to your second question, we've completed the... for the acute setting, there are no guidance. No drug has been approved for acute treatment of exacerbations.
This is a process where we are on the forefront collecting the data that ultimately, we will sit down and meet with the FDA and come up with what Phase III program looks like. The clear benefits of this is that we're looking at most, a two-week endpoint. The agency looks at anything beyond two weeks as a new exacerbation, we, you know, we already know what it takes to get an approval to reduce new exacerbations. We're anticipating looking at, and the data we're collecting in our Phase IIs is also looking at the acute effects on FEV1, symptoms, et cetera.
It's probably gonna be some combination of FEV1 plus, you know, treatment failure in that first couple weeks, as part of Phase III program. Short studies, which brings the cost down pretty dramatically in terms of, And time, we're anticipating the, you know, the full start to finish for Phase III program to be something in the one year neighborhood for acute indication. We would certainly need two studies, I think, 'cause this is such a new, novel area.
On the other hand, for chronic administration, with a positive Phase III in China, with our global study Phase II data, which I showed you, which was about 66% in the US, we probably will only need some modest bridging study to be able to utilize the Phase III, because they use the same GINA guidelines as we do for treatment.
Fantastic. We're out of time, unfortunately. We'd love to continue the conversation and learn a little bit more, but we will on time.
Yes.
Thank you again for the presentation, taking our questions, and with that, we'll conclude and we'll follow up soon.
Thank you very much. Appreciate the opportunity.
Thank you, Barry.