All right. Good morning, everybody. I think we'll get started here with the first fireside this morning. My name's Derek Archila. I'm one of the Senior Biotech Analysts here at Wells Fargo. Very excited to be joined by Disc Medicine, with John Quisel, CEO. John, great to have you here.
Great to be here.
Excellent. Well, timely, because we've got some hot news for DISC-3405, and some data in PV that you guys just presented at the SOHO conference. Maybe that's a good place to start in terms of just updating us on that program.
Yeah, it's a great place to start. DISC-3405 is a monoclonal antibody against TMPRSS6 designed to restrict iron, which is a mechanism that has already been proven out to be effective in managing excess red blood cell production in polycythemia vera patients.
What's been exciting about this program is just the rapid progress. We honestly, our guidance was that we wouldn't have data till the end of the year, but the trial enrolled far ahead of schedule. We were able to pull in or really needed to pull in our initial data disclosure. The trial is 2 cohorts, cohort A, cohort B.
Cohort A is designed to probe essentially our max dose, Q2 weeks dosing, but there's a dose run-in kind of adjustment, just checking that we've got the right dose for these patients at the beginning of the trial.
The data just shows a complete snapshot of all the cohort A patients that we have on board as of the data cutoff back in the summer. It looks really promising. I think as our first experience in these patients, we can see for sure, as expected, the drug is restricting iron, engaging all the mechanisms that are supposed to be engaged.
The real goal here is to achieve really the most kind of side effect-free control of hematocrit that you can achieve for these patients. That's really the objective. It is a competitive space, and I think we expect all of these iron restriction agents to end up with about the same efficacy level. That's assessed by looking at the rate of phlebotomy, right? Typically, these patients are being managed by simply bloodletting, which it turns out makes them feel miserable.
So the idea of replacing that with a drug that allows people to keep their iron in their bodies, which makes them feel a lot better, no surprise, but still retain that kind of stable hematocrit around 45%. That's the objective. So we've seen recent approval of rusfertide, which is the pioneering product in this space, showing about 70%-80% phlebotomy-free, reduction in phlebotomy rate.
That's pretty much exactly what we see. We see a reduction in the phlebotomy rate from about four per unit of time down to about 0.6, which is right in the same neighborhood as we've seen with other agents. If you look at the rate at which patients from time zero are phlebotomy free, that's a little bit north of 60%.
Now, that's a little low compared to the comparators, but the relevant apples to apples is actually look once you're on a stable dose that's been maintained for a while. There we had about nine patients who'd been on long enough to achieve that, and seven of those nine were phlebotomy free as well during that kind of later stable dose interval.
That puts us in the high 70% range for phlebotomy free, which is right in amongst all the other compounds with the iron restriction mechanism. So side effect wise, we see almost no anemia, almost no injection site reaction. I think that is if we're able to prove that out in a larger set of data that is actually distinct from, I think, what some of the other agents have been able to show.
Because sometimes you get anemia, apparently, if you restrict iron too much or too long, it pushes down too hard on hematocrit, and we believe that with the only antibody being developed here, we'll be able to achieve a kind of a tailored effect on iron and hematocrit that may be able to give patients a really clean experience.
What is the biggest unmet need in this indication? Is it around safety or is it that most of the efficacy is generally in the same ballpark? What are we solving for here?
Yeah, I think you want to achieve. Clearly everyone can achieve a very significant effect on hematocrit with this mechanism, which is no surprise given the power that iron has on erythropoiesis, and even some evidence of kind of direct interaction with the JAK pathways that tend to be hyperactive in this disease.
No surprise that all these agents are able to achieve that, a kind of a similar level of efficacy. I think then really it just becomes about giving the best possible product experience for the patients, which is a mix of ease and convenience, and avoidance of any side effects.
If you look across the landscape, there's some evidence of injection site reactions with some agents, some anemia with other agents. I think those have been the places where different molecules may be able to distinguish themselves.
Got you. I guess what's next for this program in terms of development? It seems like now we've got good proof of mechanism, proof of biology. Where to next and what's the path to registration?
Yeah. The trial fully enrolled 2 20-patient cohorts, which are designed to kind of probe the Q2 weeks dosing regimen and Q4 weeks dosing. That'll come in cohort B. That was fully enrolled by the middle of the summer. We'll be able to have data from cohort B by the end of the year.
From there on, the trial will wrap up, and I think our plan is to move to an end of phase II meeting and get that going into phase III. With gratitude to the rusfertide program that came before us, I think the pathway has been pretty well established in terms of what a trial looks like, what the endpoints are going to look like. Somewhat different for us, where everything else we are doing is breaking open new ground, there is a pretty well-established path here, and we think we can move fast.
Got you. Do you think you need Q4 dosing to win in this market, or is this just more of a nice to have?
Well, our competition on the TMPRSS6 target is nucleic acids. One of them is being explored in Q4, one of them is going to be explored at Q12. I think the longer, the better perhaps, but I would prioritize safety, and I think-
Sure
Actually avoiding anemia is part of the charm of the antibody approach. I think either one could be competitive, especially given that in the end, as a commercial presentation, our goal is, of course, to get to an auto-injector, self-administered approach that is very straightforward for patients to use. I think once you are in that kind of product presentation, Q2 four weeks, Q2, Q4 weeks does not really matter very much.
Got you. I guess, as you think about the competitive intensity as you've been talking about, where do you see DISC-3405 fitting in in the treatment paradigm? Is this first line, or is this after failures? I guess what was the patient makeup within the first cohort here?
Yeah. That's actually part of the data that's pretty interesting. As a first trial, we're very open to patients on all kinds of different therapies. As a result, you can see we have patients on hydroxyurea, which is the mainstay frontline therapy. You have patients on interferon, which is a little bit more of an aggressive therapy.
Clearly, the iron restriction effect is working on top of any of those. I think the goal would be to have this be a frontline approach. Honestly, if you're looking to control hematocrit, avoid thromboembolic events, I would hope that eventually we're maybe even able to displace hydroxyurea as the first therapy of choice. Because I think iron restriction as a category may show some real safety advantages relative to that molecule.
Got you.
I think that's the goal. It's a chronic disease for these patients, so you really want something that's straightforward, relatively free of side effects that they can take for a long time, just keep that thromboembolic risk under control.
Then I think some of these other agents, like interferons and JAK inhibitors, tend to be reserved for the more severe patients who are perhaps threatening to transition to a myelofibrosis or later stage disease.
Got you. How do you view this commercial opportunity relative to some of the other programs in the pipeline?
I think it's the biggest yet. It is the most competitive, so you could divide the market amongst the competitors. But as a market, I think it's probably underappreciated. I think we've seen some evidence of where rusfertide has been priced, which is, I guess I'll just roughly approximate it as it seems like it's going to be in the same zone as luspatercept, treating anemia, low hemoglobin in the MDS space.
PV is probably similarly sized to MDS, right? You're talking 150,000 patients in the U.S., 50,000-100,000 of those probably being managed by phlebotomy. I think the data that rusfertide showed in phase III would indicate that probably all of those patients ought to be moved off phlebotomy onto an iron-restricting drug to help them really feel a lot better as they move through the disease and live with it. If you can accomplish all of that, it creates really a very large market.
Got you. In terms of what you just talked about, the patients being managed by phlebotomy, is that the low-hanging fruit, and then you can move to patients who are not being managed that way? I guess how do you think about that?
I think phlebotomy is really there to create iron deprivation
Yeah
in the patients. And what these drugs do is create iron restriction in the red blood cell compartment but allows the body to not be deprived of iron. So the easiest therapeutic rationale is to simply replace phlebotomy. I think replacing hydroxyurea, I think a lot of patients, frankly, once you're a high-risk patient, often being managed by both.
Right? And probably initially, you just simply sub out the phlebotomy, put in the iron restriction. But eventually, perhaps people will experiment with just going purely with the iron restriction.
Got you. And so you outlined the path here in terms of end of phase II, and then a pretty well established regulatory path for approval. So it seems like there's not a lot of things there. Is there anything to learn from this data set that you can apply to other indications that you'd pursue with 3405?
That's interesting. Well, we do have a trial open in sickle cell disease. A very different disease, but very similar hypothesis, which is, I think relatively underappreciated, is that there's a growing trend in sickle cell to actually try to manage patients by phlebotomy. And it's the same idea of restricting iron, actually reducing the amount of sickling hemoglobin that builds up in each cell.
And phlebotomy has shown pretty good effects clinically. So I think what we are learning is that if there's a disease that's being managed by phlebotomy, it's pretty well understood now that that is going to cause patients to feel bad. Because the point of that approach is to induce a whole body iron deprivation and thereby force iron restriction on the red cell compartment.
This approach that we're taking allows us to just restrict it in the red cell compartment but let your body keep its iron, feel okay. Your brain needs iron to help you think straight. I think seeing that perform well with, so far, a good safety profile, suggests that these targets can work as well in sickle cell. That is a more complex disease that we'll have to work through carefully. We should have some data on that, actually, by the end of this year also. More case report data.
Okay.
It's a slower moving trial, but very interesting.
How many patients do you think of data we could see for sickle?
Oh, single digits.
Okay.
Single digits.
Okay. Still very exploratory, but should be informative, at least.
Yeah, just highly focused on mechanism-
Good
showing target engagement, how that might affect markers of hemolysis, that type of thing.
Got you. Anything else that we should take away from the presentation at SOHO and just overall the PV opportunity?
No, I think key points are, we believe this is a very large opportunity, and we believe our molecule is showing signs of potentially having the best profile in the space.
To come.
developed before we can really make that claim.
Got it. Well, maybe shift gears to bitopertin and APOLLO, big phase III readout coming out by the end of the year. Maybe you can help tee it up. It has been a long journey here in terms of the experience here, but this is going to be consequential for you guys and ahead of a first launch. Maybe you can kind of just, again, tee it up for us.
Yeah, sure thing. It feels like a long journey. It has been, no doubt, a wild ride. I would say I am very proud of the way we have executed as a company on this molecule in this disease space. A rare disease, when we came into it, only one, and still only one approved product, which works by tanning and requires a surgical implant.
We went in, ran two phase II programs, open label in Australia, placebo-controlled in the U.S. We feel like we have tapped into a pool of patients who are really hungry for a new therapy. Actually, those patients have become quite active of late and have put a lot of stories of their experiences out in the media. It is just an honor to feel part of doing something that may eventually help these patients.
If you look at our timelines, we have actually been incredibly efficient moving this molecule through phase II and then into phase III. The wild ride, of course, came from an effort where we asked and were, in a sense, invited down an accelerated approval path with the FDA.
Ultimately, they felt like the surrogate endpoint did not adequately predict clinical benefits, so we got a CRL back in the winter, which was particularly surprising because we had been chosen for the Commissioner's National Priority Voucher. You know what? It is okay. Through all this, we kept our eyes on developing what we think is going to be high quality, definitive clinical data.
We had built the APOLLO trial as a confirmatory trial, but we had discussed it with the FDA in a way that it was designed to support a pivotal, play the role of a pivotal trial in case we needed to retreat back to a traditional approval path.
That is where we are, and thanks to just the high enthusiasm from the doctors and the patients, the trial enrolled much faster than expected. Here we are, just about six months after our CRL, on the cusp of delivering data from that trial. We are very excited about it. We feel like we learned a tremendous amount from the phase II data set.
It was our first experience with these time in light endpoints that are recommended by the FDA as a way of demonstrating a clinical, what they would view as clinically meaningful effect of the drug. With that phase II experience, we think we were able to design a phase III trial that is loaded to give us a successful readout, to convert those signals that we saw into phase II into just a clean stat sig phase III result.
But of course, there's risk around that. There always is, and I think you see the markets all kind of taking their position up or down on our probability of success. But we're tremendously excited about how this is going.
Got it. Again, maybe an interesting question, but what have you learned through this whole process around the regulatory and working with the FDA, given the fact that you kind of round-tripped here and were back to just focused on a registrational phase III.
But you recently had a conversation with the FDA to align and ensure that you're aligned on APOLLO, but I don't know, any kind of key learnings that you've come along the way over the last 18 months?
Well, I think we learned what everybody I think already knows, which is that accelerated approval is a highly controversial path. In the industry, in the regulatory space, there have been a number of drugs that achieve that approval, and then confirmatory trial forced everyone to pull the drug back again.
I think it's created a lot of controversy inside the agency, and we were part of that controversy and came out on the adverse end of it. I'm just grateful that we kept our eyes on the prize of getting a really good definitive phase III trial done in the background while we were having those conversations with the FDA. I think there's general alignment between us and the FDA that this trial can be the supportive data to respond to the CRL and support traditional approval in the end.
Got you. So in the CRL, and you've kind of talked about this, but love to get the updated view in terms of, we know bito lowers PPIX, but that association between changes in the sunlight endpoints, that correlation.
How do you get confident there, and ultimately, what will the FDA be really looking for as the outcome of the phase III trial? Are those co-primary endpoints enough, or are they going to look down to the patient-level correlation or certain thresholds? Like what additional analysis might they do on the APOLLO trial?
Right. Well, the correlation between protoporphyrin IX and the time in light endpoint, that is a creature of the accelerated approval, right? Where you have a surrogate endpoint, which in our case was supposed to be protoporphyrin IX, and they want you to demonstrate that it is reasonably predictive of clinical benefit.
That is where you get into a discussion of, well, how do you demonstrate reasonably predictive, right? Reasonable parties can disagree about what the level of evidence on that would be. You saw in the CRL, the FDA looking for a particular kind of correlation between those endpoints, and it did not meet the standard they were looking for. So be it.
Now with the APOLLO trial data coming, the co-primary endpoints are protoporphyrin IX and time in light, now just focused on month 6 of the study, and that was designed to avoid some of the placebo effect that we learned about in phase II. We just need to hit those two co-primary endpoints.
The question of correlation does not matter anymore. We fully expect that they will show a relationship and some association, as they did in phase II. But that is no longer a part of the regulatory conversation.
Really the focus is just, are you demonstrating a statistically significant and clinically meaningful benefit for the patients? We believe that the time in light should be sufficient to achieve that, given that SCENESSE, the one approved drug, was approved on a very similar endpoint, and about a 50% effect size that they were able to detect in their study.
Now we have secondary endpoints, and probably the most important of which is a reduction in phototoxic events, these pain attacks the patients get when exposed to sunlight. Our data were very robust on that in phase II. We are hopeful that we will be stat sig on that as well. I think that would be a really nice kind of evidence of what we think is a profound effect this drug may be having for these patients.
Got it. It would be great to walk through the endpoint here and the window that you guys are looking to measure these efficacy endpoints. I guess the question really that we get is, again, the variance around here-
Sure
in terms of behavioral patterns of these patients and seasonality. Maybe you can just walk us through in what gets you confident.
Right. Yeah, no, there's no doubt. The way that the endpoint is administered is the patients receive a handheld device, an iPhone or whatever, and it has a diary on it where they can record each day the amount of time they spend exposed to light. It's the light that's meaningful to them in their disease state, right?
Some patients, light coming through a window will trigger their disease. They're just supposed to track that every day. If they don't, they're reminded of it. We have very good diary completion rates from phase II and similarly from phase III. At the end of the study, we apply an algorithm that looks at the time between 10:00 A.M. and 6:00 P.M. each day, totals it up.
If the patient's had a pain attack on that day, it censors that time out, so we don't get credit, the drug doesn't get credit if the patient had a pain attack. You can sum that up across the entire study.
You can also sum it across a smaller time interval. What we learned in phase II is that if you sum it across the entire time interval, with our drug, patients don't know if they're on it. It's truly blinded. The other drugs that have been studied in this phase work by tanning. Patients become very quickly unblinded, and that was the historical data we were looking at as we were designing our phase II program. We realize now, oh, that actually greatly affected-
Sure
the placebo response. What we learned in phase II is that pretty much everybody will initially come in with a lot of exuberance into the trial, push themselves, put up more time in light than they normally do. You will see every group going up fast, faster than they should, then the placebo group tends to come down, the active groups tend to hold steady or even increase over time.
In fact, in our long-term extension study, we just see patients spending more and more time in light, which makes sense, right? Biochemically, the drug is giving patients their benefit within a matter of weeks, then it basically plateaus and stays stable for years. But patients have a lifetime built up of avoiding light, and they need to change their behavior to take advantage of what the drug is giving them.
That is why we see this kind of trend upward in time of light in the active groups over time. Looking at that from phase II, it was pretty apparent that measuring the time in light across the entire study as the endpoint injected a lot of placebo noise into the trial, like non-drug related effects into the trial.
Whereas if you looked at the last month, you really started to isolate in on the drug effects. To design a pivotal trial that would efficiently detect a drug effect, we thought it would be best to just look at the last month.
We probed whether it would make more sense to look at the last 2 or 3 months, the last 2 weeks. We looked at what interval would minimize the variability, and the sweet spot seemed to be about a 1-month interval.
That is why we chose month 6. From there, we used our phase II data to assess the variability of the endpoint. Like you say, it is a highly variable endpoint. There is no doubt about it. What you got to remember is we are looking for about a 50% effect size. We actually took a substantial discount on effect size.
In months 4, the last month of the phase II AURORA trial, effect size was 14.9 hours. We used 11 hours instead for our powering calculations, and that was based largely on essentially averaging months 2, 3, and 4 of the AURORA study, where you are just starting to separate away from the placebo group. We think we were conservative on that, and if you look at the variability, it was 24 hours, so very substantial variability.
You plug that into the calculator, comes out with a predicted, you get 80% plus powering with 150 patients. I think it is worth reflecting on that for a minute. We are trying to detect a 50% effect size.
In many, with most endpoints, you could do that with perhaps 20 or 30 patients in a very straightforward way. But to deal with all of what you said, this is a behavioral endpoint. Patients show quite a bit of variability in how they behave. It is how much time they choose to spend in light.
There are seasonal effects, for sure. There are regional effects, and we stratified by region and by baseline severity to try to make sure we account for some of that. But fundamentally, all of that variability is accounted for in the phase II data.
That was 75 patients. Now we are at 150, and in the end, we enrolled 183 because of the enthusiasm for the trial. We feel very good that this trial is powered to convert those signals that we saw in phase II into a clean, statistically significant signal for phase III.
Super helpful. You guys did a sample size re-estimation back in January. Everything that you just said, I guess, what did that tell you about some of the actual variance that is going on in the trial? This is based on the daily diary, if I recall. I guess, how does that get you more confident based on the trial design that you just outlined?
Right. No, exactly right. That was part of our anxiety was, well, we think we are going to administer the phase III trial exactly the way we administered phase II. We think the patients are going to behave the same. If that is true, all of our calculations should work out.
But to check that, we put in this blinded sample size assessment to look at the first 50 completers, which would be about a third of the intended 150. We did that. That came out in January. In fact, if you apply the same calculation that we applied in the powering, it was essentially right on target. This is just looking at the variability.
Yeah.
There is no unblinding. We cannot say anything about the effect size. But at least in terms of variability, the phase III patients seem to be behaving exactly the same as the phase II patients, which is very encouraging, right? It says, okay, the math we have applied to design a successful phase III trial appears to be on track.
Got you. So I know you said by end of the year, but any more granularity in terms of timing?
Let's just stick with that. I would say it's Q4. Is the guidance. I guess it's publicly known that we had our last patient in in March. In fact, we had to cut off enrollment in March. So last patient, last visit is going to be in September because it's a 6-month study, and then I think everybody can run their own mental algorithm of how long a company typically takes to turn that into a top-line readout.
Perfect. So maybe let's touch on the market opportunity. You guys had kind of been doing a bunch of work identifying patients and starting pre-work on the centers ahead of the CRL, and then now we're kind of getting ready for launch again. So maybe just talk us through some of the things that you guys are doing today, and ultimately, how should we be thinking about the market opportunity, the size of the market here?
Right. Yeah, I think, if you started with the kind of the outer boundary estimates from Massachusetts General Hospital of genetic prevalence in the population of this genotype that's responsible for EPP, is estimated about 20,000 in the U.S. That's substantially larger than academic estimates that had previously put the market about 3,000- 4,000 U.S. patients.
We went to claims data. What we saw in the claims data, with pretty careful scrubbing and a lot of secondary checks on reliability, put it at about 14,000 patients who have received care under the code for EPP.
Now, of those 14,000, 8,000 of them only had one code. Right? It tells you that that is a patient that's not highly engaged in their care, and typically the profile is that they're seeing a GP or a dermatologist out in the community.
You have about 8,000 of these, what we call less engaged patients out there. But that leaves you a core of about 6,000 who do seem to be engaged in their care, and that's now getting closer to the number that the academics predict. Somewhere in that 3,000- 6,000 range is what we believe is the kind of proximal, approachable market of patients who are engaged in the care and should be straightforward to activate if there's a promising new therapy.
That's looking at through the lens of claims data, kind of epidemiological studies by caregivers. We also, despite the wildness around the CNPV, where we had to hire and then let go of some of our commercial team, we did retain about half of our sales force. They have as well as an MSL team.
They can't talk about our product, but they're out discussing the disease with doctors and trying to just talk to people about how they're diagnosing it, whether they've heard of it, whether they have patients on it. That effort is continuing to tally up patients who we think are real. Then, of course, we have our own trial patients, and we have an expanded access program as well.
When we get to launch, we'll have a pool of patients who are already on drug through our extension studies, and that's probably going to be in the ballpark of 150 patients in the U.S. Then we'll have additional patients from the EAP, where demand is very high, but we haven't shared yet the number of patients there. Then we'll have, we estimate probably about 600 patients who are seen at the centers of excellence.
These are our trial sites, doctors very well known to us who are, I think, very enthusiastic about this mechanism of reducing the toxic metabolite. Then from there, it'll be a broader reach into that initial 3,000- 6,000 patients. Then getting to that full 14,000 claims database number, what we think will represent peak sales, that's going to take time.
That's going to take really bringing in patients who, I think have had a very discouraging run with their disease, where they get their diagnosis, they don't have a lot of therapeutic options, they end up just living a life kind of designed around darkness, basically.
I guess, how do you think about the incumbent SCENESSE in that market and, ultimately, how are you thinking this market overall evolves and there's other additional competitors
Right
soon to be in the market also. How do you think this kind of market goes from basically one therapy kind of sub-optimal to multiple therapies that will be available?
Yeah. SCENESSE, it's hard to estimate exactly how many patients are taking it because you can't tell who's taking 6 doses versus 1 dose in a year. We think compliance is poor. But probably measured in a couple hundred patients, right?
So it's a very, I think, a small minority of patients who are accessing that drug, and it's no surprise because they have to travel to one of a handful of centers where you can do the surgical implant, and it's just not a great kind of repeat modality for people.
I think in Clinuvel's recent report, they noted, in fact, their sales are going down because patients are going on to other trials, and I would assume that's us and that's also a drug called dersimelagon, which is an oral tanning agent that initially failed the first phase III trial, but then read out positive from phase III and is now also in an approval process.
So I assume the market will be kind of taken over by oral agents, which are going to be more straightforward for patients, and I didn't say it, but bitopertin is a once daily pill, very convenient.
Then, I think from there it's going to depend on clinical data. We know from their own stories that there are many patients having a great experience on bitopertin. They've been public about that.
We know that physicians are excited about the ability to not just put some kind of barrier against the sunlight, but actually reduce the toxin buildup inside the body. They see the potential that that may benefit liver health and other aspects. Although, to be fair, that won't be proven out in our phase III trial.
I think we're going to have a competitive profile. The tanning agents have tended to have difficulties showing a reduction in pain attacks. As I mentioned, our data was quite robust on that in phase II, and if we're able to kind of hit that stat sig in phase III, I think that'll be a powerful differentiating feature.
Based on the patients that you noted that are kind of accessible at launch, what's your anticipation in terms of the ramp? Should a typical rare disease launch, do we see bolus and then kind of steady growth afterwards, or just kind of steady eddy? What would be your expectation?
Well, I think there will be the straightforward transition of patients from who are already on therapy onto commercial drug. I think there will be also a fairly rapid uptake in centers of excellence. Then I think as you get to the broader market, that's probably a slower curve. So you could view it almost as three different superimposed curves of launch going on.
The conversion of patients who are already on drug, the access to patients who are already being seen at top centers, where a kind of awareness of new therapies is going to be very high.
Then, a slower, longer term ramp into the broader population, where there's a certain amount of kind of finding the treating physicians, making them aware of new therapeutic options, and hopefully activating those patients and providing them with new options.
Got it. Well, John, I think we'll leave it there. Thank you so much for the discussion.
Great. Thank you.