Great. Thank you, everyone. Again, I'm Andrew Fein, one of the biotechnology analysts at H.C. Wainwright. It's my pleasure to next have Fulcrum Therapeutics come and speak with us. Here from the company is Alan A. Musso, the Chief Financial Officer, and Iain Fraser, the Interim Chief Medical Officer. Apologies, apparently, Alex C. Sapir, CEO, got a bug, so he, he's not joined. But I think we'll be in good hands, with the rest of the team. So maybe the best place to start is, you know, your kind of overview of the pipeline for folks that are perhaps less familiar with Fulcrum or, you know, engaging, re-engaging with the story now.
Yeah, sure. Yeah, our pipeline is oral small molecules. The lead program is for a disease, facioscapulohumeral muscular dystrophy, or easier pronounced as FSHD, and it's an orphan disease. In the US, the prevalence is about 30,000. We ran a phase II trial, saw really interesting results there, and then moved on into phase III. The phase III trial has recruited 260 patients. It's fully recruited as of September of last year. We're looking at the readout from that trial in the fourth quarter of this year, and we're really excited about it. It is a disease for which there's no approved therapies. It's a slowly progressive disease that over time, single-digit declines over time, and about 20% of the patients end up in wheelchairs.
But the loss of function and sort of the ability to sort of live a normal life declines, and there is a big opportunity to introduce a new drug. We have good relationships with the FSHD Society, and that has the patient community that's pretty well linked. Yeah, we're looking forward to that data readout in the fourth quarter of this year. With success in this trial, we anticipate filing in the first half of next year, and market launch in 2026. And the second pipeline program is a phase Ib trial. It's another oral small molecule in development for sickle cell disease. The mechanism of action is an induction of fetal hemoglobin.
We had an ongoing phase I trial, in which the patients that were dosed saw a pretty impressive increase in that. So we're now going to two dose cohorts. Each of them will be 10 patients, starting with a 12-milligram cohort and then moving on into a 20-milligram cohort. We're bringing on sites and are working to recruit the 12-milligram cohort first, and haven't given a formal guidance, but we will as we start to see patient recruitment into that program.
Oh, that was, that was a very, very helpful overview. Maybe you can, you know, just taking a step backwards, you know, speak about the role of p38 and, you know, targeting p38 in the context of FSHD and the scientific rationale that gives you confidence.
Yeah, absolutely. So losmapimod is a p38 MAP kinase inhibitor, and that class of drugs was under development by a number of companies previously for its anti-inflammatory effects. Losmapimod itself was originally developed by GSK, and they had studied the drug in a number of those inflammatory conditions, including rheumatoid arthritis, COPD, acute coronary syndromes, nephritis, and so on. And I think the take home from those inflammatory type indications was you could show an anti-inflammatory effect upfront, reduction of pro-inflammatory cytokines, and that tolerized over time, and so you lost effect, and that's likely why they didn't show those effects. The mechanism in FSHD was really discovered by Fulcrum, completely unrelated to any of the work that had been done previously on the anti-inflammatory side.
It was not that Fulcrum was looking at that particular pathway, but rather was looking at cells derived from patients with diseases and looking for ways to interrupt the pathogenesis there. The p38 MAP kinase pathway was identified by taking cells from patients, from muscle cells from patients with FSHD, differentiating them into myotubes in culture, and showing that inhibitors of p38 MAP kinase could rescue the phenotype of myotube degeneration and necrosis that occurs in that fashion. So we have a pretty compelling in vitro data showing as you titrate in losmapimod or indeed other p38 MAP kinase inhibitors, you can reduce the expression of DUX4 in that system. DUX4 is a transcription factor that is aberrantly expressed in muscle cells in patients with FSHD.
Normally, it's expressed transiently in the embryo, and then it's silenced for the rest of life. In these patients, they have an abnormal genetics that causes the DUX4 to be expressed. And you can show in those myotubes in culture, as you add in the losmapimod, you get a reduction in DUX4, you get a reduction in the downstream transcripts that are modulated by DUX4 and that are likely contributing to the muscle cell death. In these patients, you can see a reduction in caspase-3 and markers of apoptosis, and you can see a reduction in muscle cell death, all while preserving the intact myogenesis program, so you're not interrupting muscle cell formation in that fashion.
That's the early work that was done to identify it, clearly different than the anti-inflammatory work that was previously evaluated and shown pretty convincingly, not only by Fulcrum, but by others now in vitro systems.
... That's, it's very helpful. I guess, you know, one of the issues for the company has always been the importance of setting expectations ahead of clinical data, because you're dealing with some endpoints that are not, you know, the tip of the tongue for most investors. So maybe with that being said, you can kind of speak about, you know, the trial design, endpoint, and you know, how you're thinking about the totality of the data. Because it seems like it'll be ultimately the totality of the data, rather than perhaps any one individual component of it, which will determine the path forward or the ultimate success regulatorily.
Yeah, so sure, I'd be happy to address those. So I think the important thing to state upfront that that's really, in some ways, a benefit of this, is that there are no therapies for FSHD. Nothing has ever been tried, nothing has ever been approved. So there's no precedent in a regulatory sense for, "Yeah, this is the endpoint that you should pursue if you're developing a drug for FSHD." So that's the first point. Second point is that it's a disease that impacts muscles throughout the body. It most characteristically impacts the upper extremity, the shoulders, and the face, but it does affect muscles throughout the body, and it's somewhat asymmetric, and it's somewhat asynchronous, so the progression of the disease varies from patient to patient.
So it's not as though one particular muscle or muscle groups is being impacted, and so that's part of the challenge in this particular disease. In our phase II study, called ReDUX4, the primary endpoint was a muscle biopsy gene expression profile, trying to recapitulate some of the things that I mentioned earlier that were demonstrated in vitro. Turns out that's really hard to do in vivo because of the extreme variability that you get coming out of that, and it's, you know, the infrequent expression of DUX4 in the myonuclei, coupled with the variability in the tissue composition of the biopsies, 'cause these muscles in patients with FSHD are not all muscle. There's a bunch of fat there, fibrous tissue, inflammatory tissue, and you get variable components in your biopsy. So there was too much variability in that to see a signal.
But there were a number of functional and pathology-related or muscle health-related endpoints in the phase II study that all trended towards showing benefit with losmapimod. One of those was the reachable workspace exam, which is the primary endpoint in phase III, and then the others that showed effects. There are secondary endpoints in phase III, including the patient global impression of change. There's a whole-body MRI assessment, which evaluates fat infiltration across the body, and there's also a shoulder abductor dynamometry that's there. So that's how things from phase II transferred into phase III. The reachable workspace exam, which is the primary endpoint of the study, is a novel endpoint, so there are no drugs that have been approved using that. We've had a number of discussions with FDA around that, helping them to understand the implications of that.
We reached an understanding with them around what additional information they would like to see concerning the clinical relevance and the magnitude of change in reachable workspace that translates into activities of daily living, and we are pursuing those in parallel with the phase III, as well as part of the phase III study. But they've never suggested an alternative endpoint in our discussions with them, and so I think they have a sense that that seems to be a reasonable endpoint for this disease, and they've indicated that there are other sponsors who now are looking to use this in their evaluations as well. So, maybe I'll stop there and see if there are further questions about that.
There is a que-- Go ahead.
Why would tolerance not be as much a problem with this versus as it was with the brain game?
Yeah, so I think they're just mechanistically different aspects of the MAP kinase pathway, and, you know, I think when the p38 pathway was originally described way back when, was predominantly related to alterations in gene expression. I think the impact on cytokines and pro-inflammatory aspects came later. I think they're different pathways within the cell, regulated in different fashions. I don't know why, teleologically, that, that would be different, but certainly, that's the observation. The empiric observation is you get that tolerance, but with the effects on gene transcription, you do not seem to get those. I don't know what the underlying biological reason for that might be.
In the context, going back, I guess, to the reachable workspace endpoint. In the context of that endpoint, are there steps that companies take to reduce noise associated with the endpoint? And I guess, you know, how should we think about good data versus good enough data? And which of the secondary endpoints are most worth our focus?
Yeah, yeah. So a number of questions there. So obviously, in the execution of this endpoint, there are a number of things that you can do to ensure standardization, and that. Part of that is making sure that the setup at the sites, which involves a video screen and a camera and a chair that has to be a standard height and a standard distance away from the camera in a room that is free of interruptions and doesn't have people walking in and out of it, and so on, all of that needs to be done so that there's been attention paid to that. The exam is typically supervised by a physical therapist. They're not scoring the exam, but they supervise it and ensure that the patient does that appropriately and in order to-...
be licensed to participate in the trial, those physical therapists have to undergo a training, with a dummy patient, and that those exams get reviewed by Bioniks, which is the company that's developed the reachable workspace exam. And they provide feedback to that observer to ensure that the patient is executing that appropriately, and they're able to interrupt the exam if it looks like the patient isn't doing it appropriately. And by not doing it appropriately, it's really, you know, in a muscle disease like this, when you lose muscle function, you, as a patient, develop compensations and ways to get around it. And so part of what the physical therapist is doing is making sure that the patient isn't using these trick maneuvers, these compensations, as part of the exam, and that they're doing it consistently. So that's one component of it.
The other piece of it is that the initial exams for each patient get reviewed by Bioniks centrally. So they look at the tracings that come off the camera. The scoring is done by the Microsoft camera that generates a surface area, reachable surface area for the patient. If you can imagine a sort of hemisphere out in front of you on your arm, as well as behind you and below. So the camera generates that, also generates a normalization relative to the length of the arm, and that's where the RSA or Relative Surface Area comes from. So that's the surface area normalized to the length of the arm to allow comparison between patients. And those initial exams are also evaluated by Bioniks, by their scientists, to ensure that they conform with their standards going forward.
There are a number of factors that have been incorporated into that to ensure consistency in the application of the exam.
And what represents a significant improvement?
Yeah. So what we showed in phase two, the statistically significant improvement was a treatment effect, so losmapimod minus placebo of 0.047, so call it 0.05 RSA units. The baseline RSA scores in those patients, so this is the theoretical maximum for five quadrants, is 1.25. It's 0.25 per quadrant. These patients came in with a baseline of 0.53 to 0.54. So that gives you some idea of the magnitude of that treatment effect that was statistically significant, and which was used to power the phase three study. What's not known at this time is, you know, what does that 0.05 delta correspond to in terms of, "I, you know, used to be able to brush my hair, and now I can't brush my hair.
I used to be able to feed myself, and now I can't?" And that's some of the work that we're doing in parallel with the phase 3 and as part of the phase 3 to address that. So that's not known, but that's the magnitude of change observed and also the magnitude of change used to power the phase 3.
Okay. That's helpful. You know, maybe in the context of everything you described, you can speak about the Sanofi deal.
Sure.
I guess now, having inked the deal, what's Sanofi's level of involvement, you know? Where do you have the ability to kind of lean on the expertise that they bring in, you know, in the context of rare diseases, especially?
Yeah.
I guess, how should we think about the inner workings of the relationship?
Yeah. No, we're really, really excited about the deal that was announced a week ago. Obviously, Sanofi has a great presence in rare diseases, a global infrastructure, and we had made the decision that for a company like Fulcrum, it wasn't reasonable to anticipate being successful outside of the US market. So we structured the deal in a way where they have ex US rights. There will be joint committees that come together to make sure that there's alignment with that. So we think that their expertise that they'll bring to the table in terms of the regulatory knowledge and track record, development capabilities, as well as their commercialization infrastructure, will really allow us to get this to patients on a global scale, much faster than we could've on our own.
The discussions to date, although it's an early relationship, have been very positive, and it's one of the reasons why we had them as the optimal choice from a series of other options that we had in terms of potential investors. We're really looking forward to working with them. We think it's gonna be a great relationship that will benefit the patient community and allow us to do what we believe we can do very well, which would be to get this approved and on the market and successfully commercialized in the United States.
Just remind people, was there an equity component or just cash?
Just cash. Yeah. No equity component. They will be sharing a global development cost, 50/50. They paid us... They are paying us an $80 million upfront. We have a nice milestone stream, as well as very comfortable royalties that we, you know, feel good about.
Very helpful. I guess, you know, how should we think about, you know, where you guys fit in, in the context of the current sickle cell landscape, and the path forward there?
Yeah, so I think the underlying mechanism of action of pociredir, which is induction of fetal hemoglobin, is really something that the gene therapies have now reaffirmed as a really important key mechanism in sickle cell disease, in that it can potentially address multiple manifestations of the disease. Some of the other therapies out there, voxelotor and its follow-on, focus primarily on inducing total hemoglobin or increasing total hemoglobin, which clearly has a role to play, but doesn't address all the manifestations of the disease. The monoclonal antibodies, like crizanlizumab, are primarily focused towards the acute events and not necessarily addressing the underlying hemolysis. And so the fetal hemoglobin mechanism of action, I think, is really critical and one that can address multiple aspects of sickle cell disease, both the chronic underlying hemolytic anemia, as well as the acute events.
Certainly, the Vertex gene therapy reinforced that very much so by targeting BCL11A and inducing very high levels of fetal hemoglobin. A once-daily oral therapy obviously has its attractions over a gene therapy-
Mm.
Given the intensity of the conditioning regimens and so on, and the irreversibility of it. And so I think out in the community, there's still a sense of gene therapy is gonna be great for some of my patients, but it's only, only going to be a small percentage of those. And something that's oral once a day still has a lot of potential upside.
Do you still find yourselves dealing with the ghosts of clinical holds past, and-
Yeah, so one clinical hold. Not many. But yes, you know, that's clearly an issue related to concerns that the agency has around the PRC2 inhibition mechanism of action and the precedent with tazemetostat, which is a PRC2 inhibitor, targeting a slightly different subunit, but nonetheless, in that overall pathway, which showed preclinical findings of malignancy, and then a small percent of secondary malignancies in patients who were being treated for advanced synovial sarcoma and lymphoma. So patients who had other reasons to develop secondary malignancies based on their underlying chemotherapy and radiation. So a high-risk population, low percentage of secondary malignancies, not clear the extent to which the drug was causing that, but nonetheless, there's some concerns around that.
I think we're actually all out of time, so you can take the questions in person afterwards. But thank you. Thank you very much. Very helpful. Thank you.