Hello, everyone. Welcome to the Morgan Stanley Global Healthcare Conference. I'm Michael Riad from the biotech team at Morgan Stanley Research. For important disclosures, please see Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. For this session, we have Contineum Therapeutics with President and CEO, Carmine Stengone. Welcome, Carmine.
Thanks, Michael.
Thanks. So, Contineum just had its public debut in April this year. So before we get into questions, I wanted to ask if you can give investors an introduction to the company and an overview of the pipeline.
Sure, absolutely. So, as Michael said, we recently went public in April. The focus for Contineum, we are focused in the area of NI&I, so neuroscience, inflammation, and immunology. Trying to focus on areas of high unmet medical need, where we can de-risk assets prior to heading into the clinic and then heading into phase II. We have two clinical stage assets, the first of which that we'll be talking about is PIPE-791. This is a first-in-class brain-penetrant inhibitor of the LPA1 receptor. We're advancing this program in two separate indications. So one, sticking to the neuroscience side is progressive MS, and then we will look at areas outside of the CNS and PNS, where the science leads us, and in this case, to idiopathic pulmonary fibrosis.
There's resident knowledge around this target in IPF and more broadly in pulmonary fibrosis. That program recently completed in the first half of 2024, a healthy volunteer study. We'll be kicking off a PET study before the end of this year, hoping to be able to share data early in 2025, both in healthy volunteers as well as in patients. The second program in the portfolio is PIPE-307. So this is actually a first-in-class selective inhibitor of the M1 receptor, and it is this target that actually led to the foundation of Contineum Therapeutics. This is a pure play neuroscience program, so our initial interest here was built around remyelination, and specifically by inhibiting M1 on OPCs or oligodendrocyte precursor cells, we can drive a remyelination impact in relapsing-remitting patients.
So two separate programs focused on different aspects of progressive MS. As we started to investigate this target more and looking into the literature, we became interested in depression in this space as well. This, along with the relapsing-remitting component of PIPE-307, led to a partnership with J&J in the first half of last year. So we are working with J&J on two phase II programs, the first of which is the VISTA study, and that is currently enrolling relapsing-remitting patients. And J&J will be kicking off a phase II clinical proof of concept in depression before the end of this year. Something I would like to point out about the company is one, all of the assets that we'll be talking about are internally derived, so we haven't taken licenses from anyone.
As I had already mentioned, we take a strong effort early on to figure out ways to de-risk these programs. Two clinical stage assets, four different diseases. Three of those diseases come with clinical validation. For 307, relapse-remitting MS, this has been validated using a tool compound through one of our academic collaborators called clemastine, demonstrating an improvement in remyelination in relapse-remitting patients. Investigators from NIH, one of whom now leads neuropsychiatry at Johnson & Johnson, validated M1 in the area of depression. Then I think we'll spend quite a bit of time talking about IPF, and this is probably where there is the most clinical validation in over 500 subjects from multiple clinical studies from competitors, and we think that we have a distinct advantage there.
But we believe from a probability of success standpoint, having that clinical validation is critical. Another component that we put in is we try to de-risk the assets prior to phase II, and we successfully implemented this with PIPE-307, doing a PET study, making sure that we were achieving the target receptor occupancy to drive what we believe will lead to an impact both in depression as well as relapse-remitting. We are also running a PET study later this year for receptor occupancy with PIPE-791.
That is very broad and very, focused pipeline. I think that starting with PIPE-791 and the LPA1 program, so for idiopathic pulmonary fibrosis, it is fatal despite two approved therapies on the market. How broadly are these therapies being adopted by patients? What is the unmet need for IPF?
Yeah. So, so IPF qualifies as a rare disease, and in the United States, we have about 130 ,000-1 40,000 diagnosed patients. If we look at the two drugs that are approved, so there's Esbriet from Roche, which recently lost patent protection, and then Ofev from Boehringer Ingelheim. When you look at the treatment regimen for patients who are eligible, about 30%- 40% of patients do not start drug because of the side effect profile associated with these compounds. And of those who do go on drug, about 50% roll off, within a year. So it's a huge unmet medical need, and as you mentioned, this is a fatal disorder.
So the average time from diagnosis to death is about three years. So there's a huge issue here. But even with all of the negatives associated with the current programs, from what I saw recently, an analyst was pegging Ofev to do about $5.3 billion in sales this year, and Esbriet at its peak also did about $1.3 billion. So this is a largely untapped market that is in need of not only more effective therapies, but safer therapies for patients.
That makes sense. And then maybe as a quick aside, like, given that they're both going to generic, or one is generic, one's moving to generic next year, that's not gonna meaningfully represent a headwind if 30%-40% of patients aren't even on drug, is that-
Yeah, no, that's completely fair, and I think as we start to see these new therapeutics evolve, so the αvβ6 programs, the LPA1 programs, the PDE programs, I think the starting point for us is to talk about combination therapy with the current standard of care, but with a safer, more effective profile, we feel like some of these new therapeutics can eventually overtake first line and probably alleviate the need for the more toxic therapeutics.
I think that's a great way to, like, segue into what gives you confidence in the mechanism for LPA1 and meaningfully improving upon the therapeutic landscape?
Yeah
- IPF?
We've been lucky with this target. A number of our founding scientists, including our CSO, Dan Lorrain, were founding scientists of a company called Amira. And Amira was a San Diego-based biotech that sold to BMS. I believe it was in 2011 or 2012, for upwards of $500 million for a clinical stage LPA1 receptor antagonist. So this was the first program to move into the clinic with this mechanism. So we have a degree of resident knowledge there. That wasn't the driver of our interest initially. So the other LPA1 receptor antagonists out there, from BMS, from Amgen, and an earlier one from Structure, are all peripherally restricted.
When we choose our targets, we start with a neuroscience angle, and what really intrigued us about LPA1 was its expression profile in the brain, and specifically on glial cells like microglia and oligodendrocytes. So we were looking at this for progressive MS, being able to demonstrate a reduction in neuroinflammation and an improvement in remyelination.
But as we saw the profile of this compound come around, honestly, it just became too enticing not to go into IPF, given the safety profile and the differentiation features. But what gives us confidence in this mechanism is really the preexisting data. So LPA1 was first profiled by Andrew Tager at Harvard Medical School, and this was published in 2008 . And what he saw was that lung injury induces an increase in LPA and subsequently an increase in the LPA1 receptor. By activating that receptor, there is an increase in fibroblast accumulation and collagen secretion, leading to pathological fibrosis. He was able to demonstrate that this fibrosis, through knockouts, was driven through the LPA1 receptor. And then another component here is vascular permeability associated with activation of the LPA1 receptor, leading to inflammation.
Mm-hmm.
So by inhibiting that target, we can hit multiple points of the fibrosis cascade.
Mm-hmm.
And then I think probably most critically is that clinical validation that de-risks this. So BMS has now taken two drugs through phase IIs, over 500 patients, been able to demonstrate a reduction in FVC decline.
Mm-hmm.
But we can talk about BMS a little bit more. We think that there's holes in that molecule that are addressed by PIPE-791, and then the Amgen compound obviously is reading out later this year as well.
Yeah, that's perfect. I mean, just first to touch on, like, that clinical effect, given the poor prognosis for IPF, what is needed to move the needle? Is it just slowing rate of functional decline, or is an absolute improvement in FVC something that patients and providers want to see?
Yeah, I think the holy grail is showing that improvement in FVC. I think that is gonna be a really tough bar to reverse the fibrosis process and not have an impact systemically.
As we think about this for PIPE-791, we expect PIPE-791 to be a first and best-in-class LPA1 receptor antagonist that is delivered QD. So if we can have a compound that is more or even equally effective to other LPA1 receptor antagonists with a more convenient dosing regimen of QD, we think that that is a good step in the right direction. But from what we've seen from the pharmacokinetic profile, as well as our preclinical work, is that this has best-in-class potential, given its ability to fully interrogate the receptor occupancy curve. So unlike other compounds, we can dose this to levels where we expect to achieve coverage above 90%, driving further efficacy with a QD drug.
The once daily. Yeah, so I mean, I think this is a very important point to delve into a little bit further. So BMS's second iteration, 278, is in phase III, and Amgen expects data from its phase II program in IPF and systemic sclerosis. But how is PIPE-791 and its PK properties differentiated from the competition, and how do you see that sort of playing out?
Yeah, and just to reiterate, we hadn't originally planned to go into IPF. It was the PK profile that drove us there. So when you look at the BMS drugs, so they started with 020. 020 was the drug that was in license through Amira.
Yeah.
This compound went into phase II. There are some issues associated with a pretty high dose, 600 mg, QD or BID. Also had pretty high plasma protein binding, and that's what necessitated the higher dose. But if you look at their phase II data, they actually showed a nice dose response between the 600 mg QD and the 600 mg BID. That compound died due to cholestasis associated with BSEP, which wasn't screened back in the day.
Mm-hmm.
All of the compounds now don't hit BSEP. The second compound... And we believe that they showed a nice dose response because they did a PET study to be able to substantiate the receptor occupancy that they wanted, but still, that was the BID dose was the most effective.
Because of that cholestasis and the liver issue, BMS moved to 278. They reported their phase II in IPF out last year at ATS. And they were looking at 30 mg BID and 60 mg BID. So again, this is all BID dosing. The 60 mg BID showed an impact on reducing the rate of FVC decline, but not maximized, and the 30 mg BID ended up being no different than placebo.
Okay.
So as we look into their phase III study now, they are doing a 60 mg BID and a 120 mg BID.
I see.
So they're moving into a doubling of their dose in a phase III program, and a dose that, as far as we know, has never been tested in patients.
Yes, exactly.
So we profiled both of these drugs preclinically. As I mentioned, 020 was highly protein bound, and it had a high peak to trough, which can exacerbate tolerability issues. The BMS compound has moderate to high human clearance. It's also not quite as potent as one would expect. I think it's just under a hundred nanomolar.
Okay.
And again, it has a high peak to trough, and it's that high peak to trough that requires BID dosing.
I see. IPF is a primarily, like, for more elderly patients, correct? Like, how does the BID dosing... Is that a major constraint there, or are they well-tolerating in that regard?
We believe that it is. So pirfenidone was the first drug out there, and it was TID dosing.
Okay.
The side effect profile of pirfenidone, I think, arguably is better than Ofev, the nintedanib drug. But you can see that a lot of the patients who are on pirfenidone switched over to Ofev-
I see.
Due to dosing convenience. And yes, you're right, this is an elderly patient population. The more convenient dosing regimen should be a differentiating factor on the market as well.
Are there any food restrictions with the dosing type concerns or nothing?
No, we saw no food effect in our healthy volunteer studies.
All right, so then, I mean, thinking about all that, like, FDA has given BMS orphan fast track and breakthrough designation, so I think it speaks to the unmet need in IPF. Do you have any ideas of how your development timelines would compare? And given that unmet need, is the phase III study registrational required for go-to-market?
I think, again, table stakes, we're taking the conservative approach right now and assuming that we will do a phase III program. Our next step now is a phase I-B PET, and then in the middle of next year, we'll be kicking off a phase II clinical proof of concept study in IPF. Of course, we're keeping track of Pliant. They have been pretty creative in their registration design, and now they're running a phase II/III that may accelerate the approval in the EU.
Mm-hmm.
We'll keep track of that, see if that can play into our timelines in the future and how the FDA feels about running a phase II, III.
Okay.
As I said, right now, our base case is that we will be running phase III.
Makes sense. So I wanted to touch on something. You talked about the phase I-B data for PIPE-791. So in Q4, you're gonna start to look at PK and receptor occupancy in lung and brain. Can you talk about that data and how you'll evaluate it?
Yeah, so this goes all the way back to PIPE-307, so the M1 receptor antagonist, and we knew that there was a different receptor occupancy based on our preclinical work, that would drive OPC differentiation into oligos necessary for remyelination, and a higher receptor occupancy that was required to drive a change in synaptic plasticity for depression. We wanted to make sure that we ran a PET study where we could fully interrogate that receptor occupancy curve, and then that would help us to choose the doses moving into phase II.
Okay.
It's a very similar approach with PIPE-307. So our drug, our PET ligand that we're using is called PIPE-497. We are initiating the study before the end of this year. We're doing this at the Hammersmith in the U.K., same place that we used for PIPE-307. And the goal here is to look at doses that allow for full receptor occupancy with safe dosing. So initially, this is starting as a healthy volunteer study, 6-8 patients, and we will build out that full dose receptor occupancy curve. Once that is complete, we will enroll both IPF and progressive MS patients, and we wanna be able to demonstrate and share with the community what that receptor occupancy looks like in these patient populations.
I think it's a great segue to thinking about seven nine one for primary progressive MS. What will you be evaluating in that phase Ia, the receptor occupancy data in brain? Like, is there a certain level prerequisite for this is a great success in moving forward?
Yeah. So we'll look to maximize the receptor occupancy. It'll be very similar to what we're doing in the lung. Honestly, from a PET probe standpoint, the brain is much more easy to evaluate than the lung. It's more of a blood-filled concrete organ, as opposed to something that is full of air and constantly moving. We know that the Kp,uu is the same between brain and plasma as lung and plasma. So that brain data will be critically important as we do the evaluation in both different diseases.
Yeah. That makes sense. So maybe taking a step back on primary progressive, just thinking more broadly and more generally, we've seen that therapies in relapse-remitting, there are more of those there. They lose clinical efficacy when shifting over to primary progressive. Why is that the case? What makes primary progressive harder to treat?
So MS is a continuum, right? And at some point, when you switch from relapsing-remitting over to progressive MS, you're switching over from an adaptive immune response to an innate immune response. And in that innate immune response, you're triggering microglial activation, which leads to neuroinflammation, and you are having axonal loss that is secondary to demyelination. This is very different than what is addressed in relapsing-remitting. So there's 20+ drugs used to treat RRMS. They will be a portion of the standard of care moving forward in relapsing-remitting. What they do is they're efficient immune modulators. They do a good job at increasing the time between relapses. What they don't do is address the clinical disability associated with relapsing-remitting.
As we look into a progressive setting, we feel like one needs to be able to address neuroinflammation as well as demyelination. And again, that is one of the reasons that we chose LPA1. And identifying a centrally active LPA1 receptor antagonist was not a trivial feat, so this was a large chemistry lift on our part. So yeah, I hope that addresses your question.
No, perfect, and then just maybe to touch a little bit more on that, even in preclinical results, what gives you confidence in the LPA1 mechanism for primary progressive, and what evidence is there to suggest potential for impact on myelin and oligodendrocytes?
Yeah, so again, looking at this mechanistically, this starts with autotaxin, but just like in IPF, LPA is the bad actor here. So autotaxin catalyzes LPC to LPA1 to LPA. In LPA activating the LPA1 receptor, we see an increase in neuroinflammation and then subsequently a lack of oligodendrocyte survival. So by inhibiting that, we've been able to demonstrate preclinically, we can have an impact on both neuroinflammation as well as remyelination. And then interestingly, as we start looking at the progressive MS setting, for the first time, I guess it was earlier this week. So the BTK inhibitor-
Yeah
... which I think a lot of people had high hopes for in relapse-remitting, doesn't seem like it hit there, but it actually did hit on a secondary-progressive component there and we think that that is a reduction in neuroinflammation and around those smoldering lesions.
I see. That makes good context there. Maybe before moving on, I want to touch on CTx-343-
Mm-hmm
... the peripherally restricted LPA1. How does this fit into your pipeline strategy as it relates to IPF versus primary progressive MS?
Yeah. So as I said, PIPE-791 is a brain-penetrant inhibitor of the LPA1 receptor. Obviously, that's gonna be critical for a CNS setting, less critical for a peripheral setting. That being said, there's no toxicity associated with LPA1 antagonism in the brain that we've identified.
The reason that we decided to spend the chemistry effort on identifying a peripherally restricted LPA1 receptor antagonist came from several reasons. One, questions around the Inflation Reduction Act, right? So looking at multiple indications for a single drug and the pricing differences there. And honestly, for progressive MS and IPF, it's not as big of a deal. Progressive MS drugs are about $100,000 or so a year in the U.S. The two standards of care are about $130,000 for IPF. But we wanted to be able to make that differentiation.
Also, in discussions with strategics, we wanted to make sure that we had a full portfolio, should they choose to just bring PIPE-791 forward in a CNS setting, that there is a backup there that can be looked at, whether it's in lung fibrosis, where there's already clinical validation or additional indications, such as kidney or liver.
Makes perfect sense. So moving on to the second asset, I was thinking we talk about PIPE-307.
Mm-hmm.
This leverages M1R antagonism. Can you give us an overview of the program, the target, and how it's partnered?
Yeah. So this started Contineum. And a lot of this came through clinical validation from Ari Green's lab at UCSF. He is the head of neuroscience there, on the MS unit, and used a somewhat well-known drug called clemastine, and clemastine is a first-generation antihistamine, has broad antimuscarinic properties, brought that into a study called ReBUILD. And ReBUILD was looking at remyelination in patients, and the measurement that they were looking to substantiate that remyelination was happening was visual evoked potential latency. So being able to measure an improvement in the conduction velocity from the retina to the visual cortex through remyelination of the optic nerve. And this is the first time that one has been able to demonstrate functional remyelination in patients.
It was through reverse engineering after that study that the preclinical work had been done to show that remyelination impact was driven through the M1 receptor, and that's what got us interested in identifying a selective M1 receptor antagonist. And as we started to develop that program, as I mentioned, we were interested in depression as well. So early on, we started initial discussions with J&J years ago, and they had a clear interest in M1 receptor antagonism. What gave us confidence to do the deal with J&J was we saw the profile of 791 coming forward. And for a small company, IPF and progressive MS are much easier indications to develop as a small company than relapse remitting and a broader depression program.
Given that J&J is, in our opinion, the leader in the neuroscience space, and with a specific interest in neuropsychiatry with their Kappa program, their Orexin program, P2X7, and now an M1 program, they're looking to fully occupy that space. So that deal we closed in Q2 of last year came with $50 million upfront. They put $25 million in equity into the company as well, supported into the IPO. It's about a $1.1 billion deal. We are currently running a phase II relapse-remitting study in PIPE-307. J&J will be kicking off their depression study before the end of this year.
And we hold on to a co-funding option that kicks in at our option at the initiation of the phase III, that allows us to move the royalties into what are pretty high ranges that would, in a DCF model, equate to the value to the profit split that we would've been looking for, but we weren't willing to bear P&L risk from a pharma in those launch years. So we decided to go down that path.
That makes sense. I wanted to touch back on the history with Clemastine-
Sure.
And thinking about remyelination, so clemastine is an antihistamine, but also a broad antimuscarinic, but you talked about the reverse pharmacology that helped to isolate M1, but I wanted to talk about the actual impact of repairing myelin, not just slowing deterioration. Can you help to give us some context as to why this is so transformative for MS, and how PIPE-307 helps to leverage that history?
Yeah. So it's especially in MS as the disease continues in a patient, the driver of clinical disability is through demyelination of the axon. What we've been able to show, again, preclinically with an M1 receptor antagonist, is that M1 is highly expressed on the OPC cell. It's acetylcholine that activates it, that prevents that differentiation from that OPC into a fully functioning oligodendrocyte that then can remyelinate. So by inhibiting the M1 receptor on the OPC, we take the brakes off of that mechanism and then allow for remyelination. Remyelination is absolutely critical. So in a normal brain, there's a constant remyelination, demyelination, remyelination impact. In an MS patient, it skews towards demyelination.
The clinical disability. So myelin is basically an insulator of the axon, and as that insulation deteriorates, that axon degenerates, and that's where you see the clinical disability from an ocular perspective, from a muscular perspective, and from a cognitive perspective.
That makes sense. Maybe taking another step back, just thinking quickly: so there's five muscarinic subtypes. How difficult is the pharmacology to get M1 specific? Because they are fairly similar in-
Yeah, the active site homology between M1 and M5 is really well conserved. So again, we look for clinical validation, but as a company, we seem to gravitate towards really hard chemistry programs as well. So we were able to identify the first selective M1 receptor antagonist, and this was a key driver for the collaboration with J&J. Another question that often comes up with antimuscarinics, so drugs like scopolamine, lead to cognitive deficits. So scopolamine is a pretty broad anticholinergic. Our thesis heading into our clinical studies is that if you could selectively antagonize M1, you can mitigate the cognitive side effects that are generally associated with anticholinergics, and again, de-risking heading into the phase II, in our healthy volunteer study, all of the patients went through a cognitive battery of tests, everything from simple learning and memory, through executive function.
Yes.
At all doses tested, at all PKs, we saw no difference from placebo with respect to cognition in patients who were dosed with PIPE-307.
Nice. Helps to, like, filter out that scopolamine and impact on cognition and narrow it down to, like, M1 and the potential therapeutic benefit. Could you help give us an overview of the phase II VISTA design? Just general timelines and how you're thinking about that.
Yep. So VISTA started enrolling at the very end of 2023. This is focused. We're running three cohorts, so one placebo, two dose cohorts. I believe it's 168 patients in total.
Primary metrics here, safety, tolerability, and then we're using a visual component here of low contrast letter acuity to demonstrate remyelination.
Yeah.
Secondary and exploratory endpoints, the typical endpoints that you see in MS studies. So the MS functional composite will be looking at two different MRI measures of remyelination in the brain, and then also neurofilament light.
Yeah. So how can that low contrast letter acuity and other endpoints be used to measure the clinical effect and sort of, deconvolute how much remyelination has occurred?
So this is taking that next step from visual evoked potential latency that Ari Green used. In MS patients, there's often an ocular issue that slows down the conduction velocity to the visual cortex. The fallout from that is a loss in contrast sensitivity, and what we have found is that change in contrast sensitivity is one of the more sensitive measurements of remyelination. So we decided to use that as a key feature in the VISTA program.
That makes sense. In the last few minutes, maybe you can talk about PIPE-307 for depression, just 'cause that is also a very interesting program. Can you touch on the prior clinical data with scopolamine supporting M1R antagonism for depression?
Yeah. So this has been published on multiple times, so the research has been replicated. So two investigators from NIH, Wayne Drevets and Maura Furey, wanted to investigate scopolamine and antimuscarinics in general in a depression setting. And after deciding on a dose of four micrograms per kilogram, they ran a crossover design in patients who had both MDD and... I'm sorry, had MDD or bipolar. What they saw here, surprisingly, is that with an initial dose of scopolamine, after setting the baseline, you saw a rapid and robust change in MADRS. With that first dose, you see a statistically significant change. They only ran three doses, so this was dosed every three to five days over a two-week period, and they saw a very rapid change in MADRS score.
When the patients came off drug, the benefit was maintained. And then on the crossover design, same. The placebo patients didn't show any sort of impact after establishing the baseline, and as soon as they were dosed with drug, there was a rapid change. And this was, again, replicated multiple times, and Dr. Drevets is now heading up neuropsychiatry at J&J.
Yeah.
J&J will be kicking off a study with a selective M1 receptor antagonist, our program, later this year.
Perfect. What would be the next steps for the program, or what are you able to share at this current stage?
Unfortunately, I can't share a whole lot.
No problem.
Yeah.
Important to know, though, and then I guess, finally, like, can you remind us of how much cash you have and how far that gets you?
Yeah. As of the end of Q2, we reported just under $220 million in cash. So what we've guided that cash is through 2027. So it allows us to hit multiple clinical readouts.
Yeah over that timeframe.
Great. Thanks. Looks like we'll have to leave it here. Thank you so much for your time, Carmine.
All right. Thanks, Michael.