Welcome to the Morgan Stanley Global Healthcare Conference. I'm Jeff Hung, one of the biotech analysts. For important disclosures, please see the 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 Disc Medicine with CEO, John Quisel. Welcome, John.
Thank you. Good to be here.
For those who may not be familiar with Disc Medicine, can you provide a brief introduction?
Sure. We are a company focused on hematology, and specifically on controlling iron and heme metabolism as a way of manipulating red blood cell health and treating a wide range of hematologic disorders. We were founded at Atlas and went public by way of a reverse merger into Gemini Therapeutics at the end of 2022, and then came out with some positive data at the most recent EHA meeting that's, you know, driven our stock price up into a pretty good neighborhood.
Great. Let's start with Bitopertin. You're studying it for EPP. Can you just talk about this condition and the rationale for Bitopertin treating the disease?
Sure. Yeah, bitopertin is our lead program, studying in a disease called erythropoietic protoporphyria, or EPP. This is a very severe disease caused by a genetic defect in the heme biosynthetic pathway. It causes the buildup of a toxic metabolite called protoporphyrin IX, which is normally consumed during heme biosynthesis, but because of the mutation in the pathway, that PP9 builds up, and it leads to two primary morbidities for the patients. One is an extreme phototoxicity or photosensitivity. So these patients, on average, can expose themselves to no more than about 30 minutes of sunlight in a day, and this can include light coming in through a window. And if they exceed that threshold, they first experience a tingling that's called a prodrome, and then an extreme pain attack that can last for days on end.
These patients live with the disease through their whole life and end up modifying their entire lifestyle to avoid any exposure to sunlight, including often sunlight through windows. So that's what dominates the patient's daily life. The protoporphyrin IX, or PPIX, also can build up in the liver, creating in about 30% of patients some kind of subclinical evidence of liver damage. About a quarter of patients end up having their gallbladders removed, and somewhere between 2% and 5% can go on to complete liver failure, which is, of course, a life-threatening condition than requiring a liver transplant.
Now, you presented initial data from the Phase II BEACON study in June. Can you just talk about that study and then remind us what you saw?
Yeah. So we're running two phase II trials right now. One of them, called the BEACON trial, is open label, designed for about 22 patient enrollments. We had about 15 patients enrolled by EHA in June. Two of those patients had been on study for the full, pretty much the full six months, the other 15 at various earlier stages of treatment. And the data were remarkable. I mean, really, the first thing we're looking at in both our trials is the drug is designed, bitopertin, to reduce the flow of metabolites into the heme biosynthetic pathway, thereby reducing the amount of that toxic metabolite, PPIX. So step number one is to show that the drug is reducing PPIX.
The literature would say if you can reduce it by more than 30%, you should have a major modifying effect on the disease. And so in fact, we saw at both those levels, a 20 mg dose, which we view as a mid dose, and the 60 mg dose, which we view as a high dose, both showed a very nice PP9 reduction above that 30% threshold. And then, that translated into really dramatic improvements in the ability of patients to tolerate sunlight. And we measured that through a whole host of different ways of looking at light tolerance, including the time patients can spend in sunlight before experiencing what's called a prodrome, including pain attacks.
By every metric, you know, the patients, particularly those who've been on the study the longest, were really no longer responsive to the sunlight and reporting on PROs that they had no burden of disease. So, you know, really, the drug performed beautifully, reducing that key toxic metabolite and seeing that translate into essentially a resolution of disease symptomology.
Now, you're planning to report more data from BEACON at the end of the year. What should we expect to see in the updated results? And then will you have data for all patients on light tolerance?
Yeah, we expect that we will. So we know that we had 15 patients enrolled back as of our last May data cutoff. That means they'll all have gone through six months of study as we come into the end of the year. We're projecting that we will also have enrolled the rest of the study and have at least some data then from all the patients.
Great. And then the two patients that had the meaningful increases in light tolerance that you talked about, had been followed for the longest. Do you think the magnitude of improvement in sunlight tolerance for the other patients will be similar, or are there reasons to think that these two patients might be meaningfully different?
Yeah. No, the two patients were representative of the disease. One of them had a, what I would call, a kind of mid-range, protoporphyrin IX level. The other had a high range. Both of them measured probably as fairly severe in terms of, how little sunlight they could tolerate, both in the kind of single-digit minutes range. But when we put together... We did present aggregate statistics from all 15 patients, you know, where the kind of graph where you have the full 15 at the beginning, and then it slowly peters out to the two as you get further out. But that graph didn't change meaningfully if you censored out those two patients, so we think they're all following there is a similar trend line.
Then can you just remind us what the level of improvement in light tolerance that would be clinically meaningful for these patients? Then, I guess, based on what you already saw in BEACON, like, how are you thinking about peak improvement in sunlight tolerance? Like, could it even be greater with additional time?
... Right, right. So, you know, there's one approved drug in the space called SCENESSE. It's an implanted surgically in the skin as a drug-eluting pill, basically, that then causes tanning. And that drug was approved on the basis of basically improving the amount of time these patients could spend in light. And on a daily basis, you know, the placebo group reported roughly, I think about 15 minutes-20 minutes a day, and the treatment group improved that by about another 10 minutes-15 minutes. So, you know, 50%, right? But relatively small number of minutes per day. That's approvable in this field, and that was, you know, enough to create some usage.
I think, you know, the data we're seeing so far in our BEACON trial suggests, you know, multiple fold of improvement up to the point of essentially becoming no longer responsive to sunlight. So if you ask me, you know, what does it take to have a drug for these patients? You know, I'd say the precedent is about a 50% improvement in light tolerance, and we would have an oral presentation that's very straightforward. I think the data that we showed at EHA would suggest that we're aiming quite a bit higher than that, right? And we're hoping to, you know, probably at least double and hopefully, you know, get towards almost, you know, normalization.
Mm-hmm. Now, you have a second study, AURORA, that's ongoing with data also to be announced in early 2024. Can you just talk about the study, how it's different from BEACON-
Yeah.
And then what you hope to see?
Right. So AURORA is a critical study for us. It's placebo-controlled, right? So, all the data we're presenting from BEACON comes with the asterisk that it's an open-label study. There is potential for a placebo effect, of course. So we'll have, we have this AURORA study running. It's a 75-patient study, as designed, three arms, 25 placebo, 25 at that mid dose of 20 mg per day, and 25 at the high dose of 60 mg per day. Different from BEACON, which is a six-month study, the AURORA study is four months. But otherwise, the endpoints are the same. Primary endpoint is the reduction in PP9, where we're looking for greater than 30%.
Key secondary endpoints are probably the regulatory endpoint, looking at the amount of time these patients are able to spend in light without experiencing pain.
Now, the assumption that I and many investors that I've spoken with have, is that there shouldn't be much of a placebo response in AURORA. Can you just talk about whether that's a fair assumption, and is there any evidence in the literature to just suggest otherwise?
Yeah, that is a fair assumption. So, there have been, you know, a handful of placebo-controlled trials with other agents, generally in this class of agents that cause tanning through melanocortin agonism. And, if you look at protoporphyrin IX, there's, as you would expect from a metabolite, there's zero placebo effect that tends to be very stable over time. And then if you look at sunlight tolerance, across these different studies, you see about a 20%-30% placebo effect. So you'll see, you know, the placebo patients kind of increase their tolerance a little bit, and then it actually kind of subsides as you go on in the study, probably because they go into a study thinking they're gonna get active drug.
They begin testing themselves in the light and, you know, presumably then find that their disease has not improved, and it kind of subside back to their baseline state.
And you just talked about the bar for success for BEACON and what's clinically meaningful. Has anything changed for AURORA? And then maybe you can talk, what would be next steps after that?
Yeah, nothing really changes for AURORA. You know, again, showing that PP9 hitting that primary endpoint, that's critical. We expect that that will translate into success across a range of ways of assessing light tolerance. One of, you know, our key secondary is the endpoint that would be the regulatory endpoint, so that would give us insight into how that's performing. The presumed next step would be to run a pivotal trial, the next study. Given the effect sizes we're seeing so far, you'd project that it wouldn't be a large study, probably in the same ballpark as the AURORA trial itself. So you're talking 75, 80 patients. That's probably the base case.
We do get asked all the time about whether there might be an expedited path to approval, given that this is an orphan condition. And, you know, if... and I guess the answer to that is, well, yes, if we had fantastic data, we do have... You know, we in-license this drug from Roche. It does have a 4,000 patient safety database behind it, so it's very well characterized. So it's possible but, you know, I think the most likely path here is that we will, you know, take that AURORA data, have it in the Phase II meeting, design a pivotal trial that will encompass U.S., Europe, maybe some other countries, and it should be a very... You know, all the trials in the States tend to be pretty quick and rolling in about a year.
Now, you also have an NIH-sponsored study for bitopertin in Diamond-Blackfan anemia. Can you just talk about this indication and why bitopertin is a good candidate to treat it?
Yeah, this is a really interesting indication. So Diamond-Blackfan anemia is a rare form of anemia. It arises from a variety of genetic mutations in ribosomal proteins, and patients become, you know, profoundly anemic very early in life. They're prescribed corticosteroids. Most of them do respond to that initially, and then lose responsiveness and go on to basically just lifelong transfusions, which end up shortening their lifespan. It starts to look like a chronically transfused beta thalassemia, where iron overload becomes life-limiting. So nothing else works.
It's a really severe, terrible disease for these patients. The premise that a group of KOLs have developed through a set of experiments is that, because the ribosomal function is slightly defective, that means globin synthesis is slowed down during erythropoiesis. And, you know, erythropoiesis is one of the fastest cellular processes in the body, happening at very high volume. And, heme is supposed to be made, is made as well, and it's supposed to pair up with the globin to form hemoglobin. If you have a defect in globin production, that heme becomes unpaired, and that's highly toxic. So heme is a very, by itself, is a very damaging agent.
So the thinking and the evidence goes that the buildup of heme during erythropoiesis leads to apoptosis of those erythropoietic cells, and hence the anemia these patients experience. And so what bitopertin does, again, is decrease the rate of heme biosynthesis and therefore has the potential to reduce that toxicity. And, you know, we're now starting to release some of the preclinical data around that. So, you know, in patient samples taken from patient bone marrow, if you expand those and treat them so that they'll start to undergo ex vivo erythropoiesis, you actually see much better cell survival in the presence of bitopertin. And then there's no great mouse model, but there are some ribosomal protein-deficient mouse models, and we see an improvement in anemia in those mice as well. So we're very excited about this.
The NIH has been a great partner and started up this investigator-sponsored study, and as we announced in August, the first patient's already enrolled.
Great. Let's shift to DISC-0974. You're studying this in anemia for myelofibrosis and non-dialysis-dependent CKD. Can you just talk about the rationale for hepcidin suppression treating anemia?
Yeah, so when you suppress hepcidin, it releases iron. In any inflammatory disease, hepcidin levels become elevated, restricting the availability of iron, and that can independently drive an anemia, which is commonly referred to as anemia of inflammation. And it can also be a component in many diseases, there are multiple factors that drive anemia, and myelofibrosis and chronic kidney disease, where we're starting with this DISC-0974 agent, are both indications where hepcidins are extremely high and are associated with iron restriction, and that's thought to be a major contributor to the anemia in both these patient populations. And in fact, there's actually clinical precedent in both diseases, that if you can reduce hepcidin, you can drive increased hemoglobin production.
You plan to report initial data for both MF and CKD by year-end?
Yeah.
What kind of data should we expect to see in the updates?
Yeah. So, the MF trial... Both of these are dose-escalating studies. So we presented healthy volunteer data with DISC-0974 last year, showing that it is, in fact, really a best-in-class hepcidin suppressor. It's able to drive profound hepcidin suppression and iron release, and, and in healthy people, that actually translated into some hemoglobin increase. So from there, we progressed into these dose-escalating studies in both MF and CKD. The MF study's been open for about a year, so you could imagine we'll have been able to kind of go through a few doses there. And we should be able to present data... We're guiding to, you know, call it somewhere above 10, you know, around 10 or a few more patients, where we'll be able to look at hepcidin levels.
We're gonna see that coming down, see iron mobilized, and potentially we'll be able to show some evidence that that's translating into some hematologic benefit. CKD, essentially, we'll be looking for the same things. That study only opened in March, so it's been going a lot less. We'll see what quantum of data we're able to pull together by the end of the year. But essentially looking for the same thing: in the disease setting, showing that we're able to control those really high hepcidin levels, translate that into a release of iron, and then hopefully eventually see that flowing through into improved hemoglobin.
Then, I guess, given the number of patients that you expect to report data for, is there a specific, you just wanna see evidence of activity, and that these trends are happening, or are there specific thresholds that you'd wanna see?
Yeah, yeah. So I think a win at this point in development would be just showing that the drug is successful at controlling hepcidin and releasing iron in a disease setting, right? We've already proven that out in the healthy volunteers. Let's see that in the patients. I think to get to what I'd call a true phase II proof of concept, where we're really kind of translating that into a hematologic benefit, I would say that's probably more of a next year event.
Right. Now, CKD has been a tough indication to develop drugs for. You know, how are you thinking about developing DISC-0974 for CKD, and what steps are you taking to maximize potential success? You know, is there anything that might be different for MF?
Yeah. Well, so CKD anemia, right, it's a real problem. There are literally millions of patients in the pre-dialysis stage of disease who have anemia, who often are just not being treated. The only available therapies are ESAs, which come with a black box warning, require intensive monitoring, that's just difficult for these patients. And then there's IV iron, right? So these two... And these are really the two recognized components of anemia in chronic kidney disease patients. One is the gradual loss of EPO production in the kidney, and the other is an iron imbalance. And, you know, the iron imbalance is very clearly caused by hepcidin elevation, right?
It's well documented that early on in CKD, hepcidin starts to go up, and that's because hepcidin is filtered out through the kidneys, so it just naturally accumulates, leading to an entire kind of syndrome of a low iron status and contributing to poor red blood cell production. So you alluded to it being a challenging space. So yes, there was a set of what are so-called HIF-PHI agents designed to mimic a hypoxic state and drive EPO production. FibroGen, Akebia, GSK all had these agents. In the U.S., all of them failed to show safety that was any better than and sometimes worse than the ESA agents, and that led to lack of approval by the FDA for all of the agents in the non-dialysis setting. So these patients essentially have nothing.
The bar from an efficacy point of view is probably about 1 gm per dL of hemoglobin is really what's wanted, not higher. Excursions above that are considered dangerous. And then the real sticking point is safety. Safety has to be pristine. And the reason we're optimistic about safety, you know, it's early days still, but our target, Hemojuvelin, you know, it can be knocked out in humans, right? There are people with loss-of-function mutations in our target, and the only consequence of that is basically a loss of Hepcidin and an increase in iron availability. And so that's a very benign kind of phenotype. It suggests that an antibody against that target ought to have a pretty good safety profile, and so that's why we feel optimistic that we'll be able to achieve a benign safety profile.
That gram per deciliter target, you know, we hit that in healthy volunteers, so we're pretty optimistic that in a patient setting, we should easily hit that.
And then for the two dated updates, by year-end, did you mention, like, whether that they're gonna be expected to be reported together or separately?
Yeah. Well, so we... As a hematology company, we're always trying to present data at EHA in June and ASH in December, so I think when you hear guidance to year-end, you can expect that we'll be aiming at ASH. As you know, there's always a process of submitting abstracts, getting them accepted or declined, and then that can dictate the presentation forum.
Great. You have another candidate, DISC-0998 -
Right
... that's earlier. So, how's that different from DISC-0974, and then what advantages might that provide for treating specific indications?
Yeah, so DISC-0998 is basically an extended half-life antibody, so it has a PK that's about 2x-3 x higher. That data's been presented at ASH last year, and would allow something like quarterly or even less frequent dosing. That would be very attractive, particularly in a population like the CKD population, where they're not really visiting their physician that often. So that's something we're advancing as well. It has the potential, you know, if our drug proves active and successful in multiple indications, it would allow us to kind of allocate different molecules and potentially have different kinds of partnerships around different indications.
And then you're developing MWTX-003 for polycythemia vera and other diseases. Can you just talk about the premise behind, you know, behind hepcidin induction for treating these diseases?
Yeah. So, in polycythemia vera, you know, a company called Protagonist has done a fantastic job showing that a hepcidin mimetic, so, an iron restriction agent, can reduce the excess red cell production in those patients and, in fact, make the patients feel better. Now, that drug is administered on a once weekly or even less, you know, a more frequent basis. The objective with an antibody against TMPRSS6, this is again a genetically validated target that controls endogenous hepcidin. So the goal of this, of our drug, is to have conventional antibody delivery.
You know, think of it as SubQ, aiming for something like a once-monthly dosing profile, where you elevate endogenous hepcidin and thereby restrict iron availability and achieve, hopefully, the same effect, which is restricting that overproduction of red cells and, you know, translating that into a better patient outcome.
Great. And can you remind us where you are designing your own Mat2 inhibitor and identifying a development candidate?
Oh, yeah, yeah. So, so MWTX is the anti-TMPRSS6 antibody that's also Mat2, right?
Mm-hmm.
We in-licensed that, and we're actually just about to start that clinical study. It'll start with the healthy volunteers this year, data coming next year. We were founded with a small molecule discovery program against that same target, and we have largely discontinued that effort. We've learned a tremendous amount about the targets and actually determined that the antibody being developed by Mabwell had exactly the kind of properties that we felt were necessary to create a durable and meaningful change in iron, which was not otherwise gonna be easily achieved with a small molecule.
Great. Looks like we'll leave it there.
All right.
Thank you very much for your time. Thank you.