Morning, everyone. My name's Ted Tenthoff. I'm a senior biotech analyst. Come on in. Join us, please. Before I begin, I'm required to point out certain disclosures regarding the relationship between Piper and our next presenting company, Cue Biopharma, which are posted at the back of the room and also at the registration desk. Cue is developing novel immunotherapies called Immuno-STATs for cancer and autoimmune disease. Here with us from Cue is my good friend Dan Passeri, CEO. Dan, always a pleasure.
Thank you, Ted.
Looking no worse for the wear.
Just kidding.
So Dan, start off by describing the Immuno-STAT construct. I think it's a really important place to start. How does it precisely modulate immune response?
Yeah, and thanks. It's actually a really important foundation to start with because we're not a company focusing on an asset or two assets. We're a platform company. And that platform is based on engineering proteins with a specific intent of engaging a repertoire of immune cells, in this case, T cells, taking advantage of the specificity that nature provides us with, and that's through the T cell receptor. So what's actually unique about our approach is the fact that we can dial in specificity on a myriad of indications. So that's oncology or autoimmune disease, where we can specifically activate and enhance T cell activity against a particular protein, and that's what we do in cancer. Or in the case of autoimmune disease, we can target particular cells and destroy them with T cells attacking them, and I'll explain that later.
Or we can ameliorate T cell activation, and we can basically turn it off into a regulatory T cell. And that's by basically taking advantage of the particular signals nature has evolved and provides us with. And that's why we call the company Cue. It's to take advantage of the cues, our signals that nature provides.
And the way you do this specifically, the construct sort of looks a little bit like a Y, where there's a binding moiety, and then you're able to really kind of induce the activity via cytokines on the end. So just maybe explain that very briefly, because again, you know, immunity. It's two sides of the same coin: cancer and autoimmune disease. So it's really dependent on what you're binding, but then also how you're activating them, right?
Yeah. And what you just described basically is the fact that we're taking advantage of dual signaling. T cells are extraordinarily potent defense mechanisms, and they can actually create a lot of damage in the case of autoimmune disease. So if that system is activated without specificity, you're going to have a lot of collateral damage. That specificity occurs through the T cell receptor. So what we've done is we have engineered, unlike these bispecifics, by the way, that have CD3. I'm not being critical of it. It's a very interesting approach, but CD3s will activate any T cell it comes in contact with. So it's a pan-activator. What we're doing is selectively activating a subset of defined T cells within a repertoire that identify a particular protein. And we basically accomplish this by this two-signal approach, which is engaging the T cell through the T cell receptor.
That's where the specificity comes from. We have, I think, something on average of 20-30 million unique T cell receptors circulating through our body. Rather than activating all of those, we're activating only the very tiny subset that recognizes a specific protein shape. And that is basically how we're delivering IL-2 only to those T cells. And that's in the case of oncology.
Yeah, again, very elegant approach. I've always thought that's just made a lot of sense in terms of how the construct's engaging. So in that context, I'm going to start with CUE-101, because it really is your most advanced, and I think provides proof of concept for the Immuno-STAT platform. Walk us through the Phase 1 monotherapy and Keytruda combo data you reported in recurrent metastatic head and neck cancer.
Sure. Thank you. Let's start with monotherapy, and that's in second line and beyond. Most of the patients are actually third, fourth, fifth line patients. So they're highly refractory. They've been resistant to prior therapy. By the way, all of them have received checkpoints and became resistant. Chemotherapy became resistant. So these patients, to start with, are in very poor condition. And what we've demonstrated monotherapy, there are several important observations. One, we're clearly activating the T cell repertoire that we're targeting. We're seeing anti-tumor activity. We had a very solid partial response. We had a patient that had a durable, stable disease. It's no tumor growth. It went down about 5% and then just flatlined for two years. That doesn't just happen. And I want to underscore the drug that we're infusing into patients is not disrupting any mechanism the cancer's using, like a pathway.
It's stimulating the patient's immune system to recognize cancer as foreign. So any therapeutic benefit we're seeing is the patient's own immune system that we've enabled or activated. Importantly, we've seen some patients that the tumor appears on a scan to grow past 20%. The physician kept them on drug because they were clinically doing well, and then the tumor subsequently proceeded to go down. So there's a kinetic aspect here of the patient's immune system being activated. And remember, these are compromised immune systems. So the most important metric we've observed in these patients is a significant enhancement of survival. And that's even after they come off drug, because we believe our molecules are activating and inducing a stem-like feature where these T cells stay activated. So we have this dynamic interaction of the patient's immune system with the tumors.
What we've seen is a median overall survival increase of about a year, as opposed to a month, two months. The median overall survival for these patients on Keytruda or our checkpoint inhibitors averages about eight months. We are seeing a median overall survival of about 22 months. What I want to underscore is that there are a lot of companies presently getting a great deal of attention because they have impressive overall response rate, but the median overall survival has not aligned with the response rate.
That's the gold standard.
That's the gold standard.
It makes so much sense to combine this mechanism with Keytruda, where you're taking the brakes off the immune system, so it's really a one-two punch.
That's right.
So tell us about the Keytruda combo ?
Keytruda is a standard of care in first line. These are patients that have just been diagnosed with recurrent metastatic head and neck cancer. Remember, these are HPV-driven cancers. In that setting, Keytruda has an overall response rate of about 20%. It's 19%. A median overall survival of approximately 12 months. Importantly, a 12-month survival of about 50%. What we have seen is a doubling, at least, of the overall response rate. It's actually a bit over 20%. We're at 46%. We've seen a doubling of PFS, approximately. Most importantly, the median overall survival is still emerging. That's one of the metrics that we're enabling to evolve and develop. The 12-month survival is increased to just over 90%, from 50% to over 90%. That's a very important metric.
Yeah, fantastic. So I was particularly impressed by the activity in low PD-L1 expressors. So these are patients who would not be prescribed Keytruda and really would not expect to have a response to Keytruda. But here, CUE-101, just as mechanistically you would expect, is sort of targeting the immune system so that Keytruda can actually be beneficial in these patients. Walk us through some of those data, and what are sort of next steps for this program?
Sure. Thanks, Ted. That's a really important point to bring up, so the low CPS score is, in essence, a metric of how immunologically active the cancer is, so Keytruda is blocking a defense mechanism where PD-1, PD-L1 turns down T cell, so you have to have T cells trying to attack cancer for PD-1 to have an effect, so a low CPS score, in essence, is conveying that these patients don't have active immunologic response, and what we're seeing is basically the same overall response. About 50% of the low CPS scores, and that's 1 to 19. We're seeing half of the patients are actually having this enhanced survival response, so they're part of the 46%. 50% of the patients have a low CPS, and half of those patients are actually responding.
What that denotes is our drug is engaging and activating the patient's immune system, in essence, turning cold tumors into active tumors. So that's a very important observation. It's also a differentiating feature. If you look at the immuno-oncology space, we had a number of therapeutic vaccine companies that were competing with us for the same patient population. To date, all of them have had to discriminate where their drug seems to work at high CPS, not low CPS. So as far as I know, or as far as we know, presently, we're the only company that's able to activate this low CPS population and demonstrate a substantial enhancement of activity.
That's great. And what are next steps for 101?
We have a defined registration path. We have a randomized Phase 2 study that's been designed, where we're basically combining a drug with Keytruda versus Keytruda alone. These studies are expensive. That's a study that would require us to access the requisite capital. We made a strategic decision of, rather than focusing all of our resources in that one program, we're going to basically allow the data from 101 and 102 to continue to mature because we feel that will continue to differentiate competitive positioning. Right now, there's a heavy emphasis on overall response rate. We believe that as those companies have the data mature, they're not going to see the same survival benefit that we're seeing. We're letting that data mature while we're shifting our resources in autoimmune, which we've always had an autoimmune application.
That enables us to focus on short, let's say, near-term, mid-term value creation while that data matures, and then we'll revisit that clinical trial structure when that data matures. We feel that'll put us in a much stronger position with the FDA as well.
Makes a lot of sense, and that's a perfect segue into really the modularity of the Immuno-STAT platform. Again, as you described, able to also treat autoimmune disease. You guys are partnered with Ono Pharmaceutical for CUE-401, which is a really interesting program. Tell us about this. How does it work, and remind us of the deal terms and your retained economics on it.
Sure. So 401 is a bispecific molecule. Basically, it underscores the modularity of the platform. With the 100 series, as you conveyed, it basically has an MHC, epitope, and an IL-2 that engages T cells. The modularity there is we're able to swap out the epitope very easily and target a whole different population of T cells. And that's what 101, 102 represents. With 401, we basically took the observations we had with our variant of IL-2. It's a modified, genetically engineered IL-2, where it's an ablated alpha and attenuated beta. Now, the reason that's important is you're not engaging every IL-2 receptor. You're biasing it towards the T cell population you want to modify. And the specific characteristics of that IL-2 is that it requires avidity to signal.
And as you know, what that means is rather than affinity, being the attraction from one protein to another and the strength of that attraction, we've weakened that attraction, so it requires another binding element to engage and dock. So that's avidity. And then it will signal. And what we did with 401 is we coupled it with TGF-beta, which itself is attenuated and masked. And it's masked with a modified receptor so that the TGF-beta will only bind to its receptor if there's avidity on the other side. So what it requires is both IL-2 and TGF-beta concurrently.
Now, the logic or rationale of that specific engineering objective is that it's known in the field that if you want to induce regulatory T cells, rather than just proliferate existing T regs, but induce, transcriptionally modify, autoreactive T cells into regulatory T cells, it requires concurrent TGF-beta IL-2. Now, there are a number of IL-2 variants that have been in the clinic for autoimmune disease, for T regs, and they have to date not demonstrated the ability to have clinical effect. What we're showing is a profound enhancement of regulatory T cell induction. And that's because of this dual activity. We partnered with Ono early on, and they have basically subsidized the preclinical development, 100% of subsidizing its development. And we've retained a 50% interest in the U.S. And that requires that we participate at about a 35% of the cost basis.
That's great. And just to kind of go back to the mechanism here, so it's really the inverse of what you're doing with 101 and 102, where there you're turning on the T cells. Here, you're activating the T regs. And where can that be applied? So how would that be therapeutically relevant?
Yeah, wherever you have autoreactive CD4s, what we've observed is the ability to not just proliferate existing T regs, but induce, transcriptionally modify, a CD4 population into a T reg population. And that's by monitoring the induction of something called FOXP3, okay, which is basically the transcriptional activation of Tr egs. And what is distinct about this is that we believe what we're going to be able to do is take an autoreactive T cell population and shut them down. So our immune systems are exquisitely regulated. We have to respond to threats, but you don't want to have overreaction because you'll have collateral damage. If you don't respond to a threat adequately, we have disease manifestations, such as cancer or chronic infectious disease. And on the autoimmune side, when they're overreactive and not regulated properly, we can get autoreactive T cells or B cells.
In the case of T cells, which is a whole spectrum of autoimmune diseases where T cells are the primary culprit, we believe this molecule will have application, so we believe this is actually a potential blockbuster with multiple disease indications where it could shut down the autoreactive process.
When do you think you and Ono will advance this into the clinic? Where are you in development?
Yeah, really important question. We are at the point where we feel we have a body of data demonstrating that the molecule we have can go into IND-enabling studies. So we're probably looking at a late Q4 to early Q1, and that's 2026, 2027.
Great. So again, sort of sticking with this concept of modularity in autoimmune disease, you mentioned in our kind of earlier in the conversation, we've seen exciting data for CD19 CAR T to ablate the B cells to reset the immune system in patients with severe autoimmune disease. You guys are developing this with sort of a unique twist with the Immuno-STATs, the 500 series, 501 in particular. Maybe describe how this works and what are your plans here to advance?
So Ted, what we had developed historically was we recognize that cancer is very insidious in its adaptability. And one of the things some cancers do is they downregulate the MHC, which is the way a cell presents proteins that are inside the cell to the outside surface for your immune systems to survey it. And that's an escape mechanism where the cancer can disguise itself or hide itself from the immune system. So our scientists basically designed a molecule that could attach to a tumor cell and membrane-bound protein and present a viral epitope. And CUE-501 came about with the observation of, as you stated, CAR T cells being used to ablate autoreactive B cells.
What we realized is we could take this concept that we developed for solid tumors and put a CD19, BCMA, CD20, which are markers for B cells, and paint a B cell with a viral epitope. By doing so, you take advantage of already existing killer T cells with memory that are circulating through all of us. For instance, every one of us here in this room listening in have T cells against COVID proteins. Whether you've been vaccinated or you were exposed, you have activated killer T cells that have memory circulating through your body. If we painted a B cell with a COVID peptide, those T cells circulating around would see the B cell as a virally infected cell, attack and kill. We've demonstrated this preclinically.
So it's actually an elegant differentiated approach to specifically painting any target cell with a viral epitope that you can have your already existing antiviral repertoire, identify that cell as virally infected, attack and kill. The key advantage is the safety profile. What we're seeing the industry do is basically put bispecifics on B cells with BCMA, CD19 attaching it with a CD3 hanging out there. Now, a CD3 is a panactivator. It will activate every T cell that comes in contact. Well, the side effect of that is you'll end up with cytokine storm. You end up with other deleterious adverse effects. Those patients are going to have to be monitored. You typically have to have slow infusion. What we're looking at is the ability to paint any particular cell, in this case, B cells with a viral epitope. And the safety profile should be much, much better.
In fact, we don't see any cytokine release when we have looked at these molecules.
Again, really clever to redirect the existing T cells just towards the target. And is there a temporal nature of this? So it only happens for a little while while the Immuno-STATs are in, and then they revert back? Or how does that kinetics work?
Yeah, really important question. That also allows you to determine if your safety profile, you can continue to dose this drug over time. The objective is to destroy the autoreactive B cell population and then allow the patient's bone marrow to repopulate the immune system. In essence, what we're doing is rebalancing the immune system to destroy or ablate autoreactive B cells and enable the patient's hematopoietic system to produce new B cells to provide protection, but that aren't autoreactive.
Yep. And that is exactly what we've seen with the CAR T, that they repopulate with naive B cells. Really cool angle on this. And what are your plans to advance this approach?
So we're in deep partnering discussions. This is a very attractive differentiated approach for what presently is a very active space. So we've had a significant amount of interest. We have late-stage discussions ongoing with a number of parties. There's the prospect of this drug itself being a catalyst for partnering, giving us capital infusion, validating the approach, then we can apply this same approach to any cell type that we want to target. For instance, potentially overactive fibroblasts, which create fibrotic disease, liver fibrosis, renal fibrosis, pulmonary fibrosis. And the attractive thing there is activated fibroblasts have a unique protein expressed rather than inactivated fibroblasts. So in theory, we could target that particular pathogenic fibroblast population and wipe it out. So we're looking at a number of disease indications where particular proteins on those cells are known, where we could target and destroy them.
Yeah. So there really is a lot of opportunity for this platform beyond just oncology, beyond these autoimmune approaches, whether it's via T regs or the B cell ablation. So really exciting. Now, you guys ended the third quarter with cash around $32 million. I think you're paying down debt. It's down to around $5 million or something like that. How long does this fund the company? And important in that question, what does it enable you guys to accomplish?
Sure. So presently, we have approximately a year's worth of cash, maybe a little over a year. And we are looking at, first of all, this partnering prospect, which we feel is in the near term. That'll be an infusion of capital. We'll subsidize a program. So we feel right now that actually we're in a very solid, good position because we have a portfolio of programs. And we're looking at the portfolio offering us an opportunity for different approaches and strategies. Some we will look at partnering to subsidize. Others we want to hold onto and develop ourselves.
So what we've done is very deliberately take our protein engineering and apply our insights and what we're learning from the field, et cetera, and develop a spectrum or a portfolio of molecules that have particular therapeutic objectives by taking advantage of the particular profile of the condition we're trying to treat. In the case of cancer, it's activating naive rare T cells with this ability to deliver cytokines. In the case of, as you stated, B cell ablation, we're in essence painting those cells, presenting a viral epitope, and taking advantage of already existing antiviral T cells. In the case of 401, we're able to convert autoreactive T cells into regulatory T cells. And we think that molecule, by the way, is a Humira-like potential in terms of application to a broad spectrum of autoimmune diseases. So we feel we're in a really good position right now strategically.
We just have to stay the course, keep executing.
Great. Well, Dan, thanks for being with us and thanks for the update.
Thank you for having us.
Set it for the new year. Come on.
All right. Thank you.