Panelists here at RBC Capital Markets, and today it is our great privilege to have Lexeo Therapeutics for a fireside chat as part of our 2025 Global Healthcare Conference. Representing the company, we have Nolan Townsend, Chief Executive Officer, Eric Adler, Chief Medical Officer, as well as Kyle Rasbach, Chief Financial Officer. Nolan, Eric, and Kyle, thanks so much for joining us. How are you guys doing?
Great, great, great.
We obviously have a long list of questions here, but maybe before we go to the individual program, Nolan, it would be fantastic if you could just talk big picture about what progress has the organization made over the last few months, and maybe most importantly, what is ahead here for Lexeo?
Lexeo is a cardiac genetic medicines company with two clinical stage programs. The most advanced is treating the cardiac pathology of a disease called Friedreich's ataxia. We've completed a phase I/II study, and we're rapidly moving into a registration study associated with that program. I think we'll probably spend a lot of time today talking about that, but I think we've seen some exciting data. We think the therapy is having a pretty significant impact on the cardiac pathology of the disease, and we're excited to take it forward into the next study and to an accelerated approval. The next most advanced cardiac program is treating arrhythmogenic cardiomyopathy, and here we're focused on the PKP2 mutation. Can I take this off? Okay, it's just a, yeah. Yeah, sure, sorry, there's a little bit of feedback.
The Plakophilin-2 mutation represents the majority of the arrhythmogenic cardiomyopathy population. The PKP2 mutation represents the majority of the ARVC population. So these programs we're excited about, arrhythmogenic cardiomyopathy programs, currently in a phase I study.
Great, great, great. Maybe let's talk about Friedreich's ataxia for a few minutes, but again, before we go into some of the questions on the data, I'd love to maybe pick your brain, Eric, on some of the leadership changes at the CBER. Obviously, Dr. Prasad has been pretty critical about the accelerated approval pathway more broadly, and obviously pretty critical also around Sarepta's approval for DMD, which is obviously very different indications for the indication you guys are going after. What was your, what was your read on the new leadership there? Is there any change, any chance that you're going to raise the bar on you guys and maybe just ask you for a randomized clinical trial instead of a current plan? Like any thoughts there?
Once he got into the position and you saw his actual interview, which he did, he did like a half hour, hour long interview, and specifically talked about rare. I think once you're in that leadership position, you see the high unmet need, the tone shifted. I think we still see Nicole Verdun retaining her leadership role and her advocacy for the strategies that are proposed for rare. You know, obviously our insights are the same as everyone else's, but we think that from FDA leadership down and IH leadership down, it's a pretty consistent embrace that you have this treatment strategy for rare disease that we need to push forward.
I'd add, I think a number of companies aside from us are working towards regulatory alignment with the FDA across the rare and gene therapy sector, and I think all have said the same thing. We've not seen major changes in how the FDA is working with us, and I think we've heard that from other companies as well. I think we're seeing a number of examples of continued progress in the rare and gene therapy area.
Yeah, no, that's great. Please.
Important part of employees. I think it's important to recognize the employees that we're using effort to employ subjects to a lot of bias or a procedure-controlled study that is referentiated.
For sure, especially your emphasis on left ventricular mass index, which is one of the important endpoints. Maybe, Eric, can we talk about expression for a few minutes? I mean, it looks to me that the bar from the FDA has kind of evolved over time. I think initially they were asking you for expression above 40%. Now, most recently, in your latest data disclosure, you have communicated that any level of expression actually could be meaningful here and could potentially lead to accelerated approval. How do we know that like maybe low single digit level of expressions can be meaningful for patients? Like how confident are you that any level of expressions for the gene can actually make an impact for patients?
Yeah, I think the thesis starts with the biology and then works through animal models and then what we're seeing in the clinic. From a biology perspective, we know this is an enzyme essentially functioning to allow iron to bind sulfur. When we look across enzymatic diseases, you see a consistent theme, which is that the patients that are extremely deficient are the ones that have symptoms, and very small increases are sufficient to resolve those signs and symptoms of disease. I don't think that's any different in FA. We know that for mouse models, as little as 5% of normal protection is sufficient to have normal cardiac output. Finally, we see that in our clinical trial.
This is why the FDA was so accepting of our proposed endpoint, because they saw even in patients, you know, in our data set that had small increases in protection, that was associated with noticeable changes in both LV mass and troponin. Kyle rightly pointed out, LV mass and troponin are not subjective endpoints. These are hard endpoints measured by either MRI or blood-based biomarkers. When they saw that data, it just supported this concept that even a little bit of protection, reallowing iron to bind sulfur, reallowing mitochondrial respiration is probably sufficient to improve the phenotype, the cardiac phenotype of the disease.
All right, got it. That's actually helpful. Maybe similar questions for LVMI. Why is 10% the bogey here? You know, when I look at improvement for, you know, other molecules and other indications, you know, when I look at Rocket, I think in Danon disease, they've shown maybe like, you know, a little bit of a larger number, I believe 25%-30%, and maybe Mavacamten also have shown kind of a little bit of a larger number there. Like any thoughts on why 10%?
Yeah, just to clarify, the numbers you referenced are the effect size of the drugs, but I believe that the actual endpoint is the same. It's 10% for in Danon disease as well. That 10% number comes broadly in cardiomyopathy, where we see regardless of the cause, whether it's hypertension, aortic stenosis, you know, hypertrophic cardiomyopathy, lysosomal storage sclerosis, that 10% reduction leads to meaningful improvements in quality and quantity of life. Then when you look specifically at the natural history, publicly available data from published articles, you can see that 10% reduction probably has a 20% improvement in heart outcomes like survival. Taking those together, the FDA was set that bogey. We think, to your point, we think we may be above it right now. I think that gives us confidence that that's the bogey that's been set.
Just to add, you know, the actual effect size we're observing in the study is about 25% for the patients that have reached 12 months. So while the bogey is 10%, we're exceeding that threshold by a pretty meaningful margin in the population of patients that we would enroll into our registration study.
Sure, sure, that makes sense. For any of you, you know, when I look at your data, there's obviously pretty clear dichotomy between, you know, patients that have LVMI abnormal at baseline versus the broader population that you have enrolled in that trial. What's the best way to rationalize why that dichotomy? And then maybe two related to it, how should we think about the implications for the TAM? To your point, Nolan, you're now going to enroll only the patients where you have shown the cleanest signal so far. So like, again, two-part question.
One, what's the best way to rationalize that dichotomy? Two, how should we think about the implication for the TAM?
In terms of why do we, you know, how do you rationalize it? I think any disease where you're restoring physiologic function, you would expect changes to be most manifest in the most extreme cases, right? So, you know, whether it's drugs for obesity, diabetes, when you're normalizing physiologic function, you see the most benefit in the patients that are highest weight, highest blood sugar. There's no different. You're normalizing mitochondrial function. So the most benefit is in the most hypertrophied heart. As you get closer to normal, we don't expect or hope for hearts to become thinner than normal, to become, you know, hypertrophy, I guess you would say, or whatever. In the same way, you know, we're seeing that play out biologically. The single greatest correlation between the effect of our drug is to starting LVMI.
So the single, you know, that's the biggest predictor of benefit.
I'd add, in that abnormal population, five of six patients became normal. You saw normalization of the disease. You asked about addressable market as well. In the patients with normal LVMI, they have other abnormalities, whether it's with troponin or with lateral wall thickness, which are the two secondary endpoints in our registrational study. We saw improvements in lateral wall thickness. We also saw very meaningful improvements in troponin. I think even in patients with normal LVMI, we showed in two different endpoints the ability to improve the earlier symptoms of Friedeich's ataxia cardiomyopathy.
When we think about the future label of this therapy, while that registrational study will be based on left ventricular mass as the primary endpoint, because we're showing improvement on other cardiac measures, it's our perspective that we should be able to make a case for a broad label that includes the entire adult population that presents with the disease. This is not unlike other rare diseases where, you know, typically if there's no safety issue, there would be no reason for the FDA to restrict access to the treatment for patients that are a bit earlier in the disease continuum. Here we have a relatively clean safety profile. We're showing improvement in troponin. We're showing improvement in wall thickness. We're showing improvement in infarcts with the neurologic scale. We're showing improvement in KCCQ, which is the cardiomyopathy questionnaire.
We're showing improvement across all of those measures in these normal LVMI patients. I think there's a pretty strong basis, even out of the current data set, to support a label that includes the entire population that presents with the disease. We've not, you know, talked about pediatric yet, but there will be a pediatric arm to our study as well.
Sure, sure, sure. That's actually very helpful. Since you mentioned troponin a few times, and you just alluded to it, it's pretty clear to me that in your data set, troponin is a very sensitive endpoint, and it looks like there is a benefit in troponin across kind of all patients, kind of respectively of LVMI baseline. Why not using that as your primary endpoint in your registrational trial? What's the rationale behind it?
If you look at the agency's approach to biomarkers, specifically troponin, brain natreuretic peptides, in cardiomyopathies, they haven't adopted them, to my knowledge, as primary endpoints. Has to do a little bit with the definition of how they define biomarkers and how challenging that is. I, you know, frankly, I think that should change. I think we know troponin is associated with worse outcomes in cardiomyopathy, but they haven't done that thus far. It has to do a little bit with how it's collected, the standard deviations that could occur if you collected it in the same patients and standardizing that. Hopefully their rigor around that would change, because you're right, I agree with you 100%.
That's actually very helpful. Let's maybe talk about the pivotal trial here. Can you just talk about the design, you know, how you're powering the trial? Like how many patients do you need in the adult versus adolescents versus the pediatric cohorts? Maybe what's the size of the concurrent natural history study here? Just maybe walk us through how you're thinking about, you know, that trial, big picture, and maybe some of the powering assumptions behind it.
Yeah, sure. When we think about this trial to power towards an LVMI reduction of 10%, as well as identifying patients in which protection is present, when we look at our previous data, we think that somewhere around 12-16 patients would be sufficient in a phase one study to do that with a p-value 0.05. Where does that take us in terms of a natural history study? We want to oversubscribe a bit. We're going to do some propensity matching between the patients in the natural history, the patients in the trial, so that leads to double the number of patients in a natural history study. Keep in mind that some of the patients in the natural history study could ultimately go into our trial.
It's not like we have to identify true double the number of patients, you know, added all to like 36, whatever it is, because some of them will bleed over after they complete the natural history.
I'd note that the natural history study is launching, you know, this quarter. It launches ahead of the treatment study. In a way, it also de-risked future enrollment of the registrational study as well. This investment now should pay dividends on the back end because it should lead to a much faster enrolling clinical trial.
Contracts, all the things for implementation.
Yeah, so we're looking at a pretty de-risked enrollment picture given the timing of the start of the natural history study relative to the treatment study.
I mean, I need to ask, but like at this point, you don't think there is a scenario where the FDA asks you for an actual randomized trial? At this point, the plan is up and running and you guys have that in the minutes and like you guys have pretty high conviction that that will be the case?
Absolutely. You know, we have minutes from several meetings with the FDA, with the team at CBER, including Dr. Verdun. I would also note we're pretty far along in terms of just the study design itself. The last element here is just to agree on the statistical plan and then we'd be in a position, you know, to move forward. We have to take that step, which doesn't necessarily even require a meeting to do to move forward into the next study. We're on track for the beginning of 2026 to start that registrational study.
Gotcha. Very helpful. Maybe in the last few minutes, let's pivot to PKP2 or arrhythmogenic cardiomyopathy. Maybe Eric, if you want to talk about big picture about what's the strategy there. And then maybe given this is fresh off the press, if you will, you know, obviously your competitor Rocket presented some data Thursday last week, I believe. Can you just walk us through what are some of the key takeaways from that data set? So again, big picture disease and then to Rocket data.
This is obviously a highly morbid and prevalent disease. In terms of unmet need in cardiomyopathy, probably the largest addressed by a gene therapy thus far. In terms, you know, I think across, you know, multiple programs, the proof of concept has been established preclinically that if you restore this protein, plakophilin-2, you improve cardiac structure and function. What we're seeing thus far from clinical data now in two different programs is that this thesis is bearing itself out. If you look at the data that we presented in our patient, as well as the subsequent data more recently presented, in both cases, you see that you can reestablish the expression of plakophilin, and that's associated with the reduction in one of the key endpoints, which would be arrhythmia, specifically premature ventricular contraction.
I think the key message for me is that now you have independently people showing that when you restore protein, you improve function. I think there's only upside for us. Now it's a question of what's the best for the market? What's the safest drug? What's the drug that's going to be most effective? I don't know.
Yeah, I mean, nothing significant to add. I'd also just say it's a 60,000 patient rare disease. So it's probably one of the largest targets in clinical stage gene therapy today. It's, for example, more than twice the size of Duchenne's muscular dystrophy. It's a type of market that, you know, can likely support, you know, more than one therapy in it at that size. As Eric said, I think it's now about just product profile, safety, immune suppression, you know, things like this will likely play a role in the patient's choice for which therapy they would like to adopt in the future.
Sure, sure. That's helpful. I believe you're starting at materially higher doses here for PKP2 versus FA. I guess two-part questions. One, does that keep you up at night?
I mean, we have seen multiple setbacks, unfortunately, for gene therapy and maybe, you know, the therapeutic window for gene therapy is not as large as we all originally anticipated, maybe thought it was going to be. I think you have a different immune suppression regimen versus FA where you're adding rapamycin. Just talk about all of those dynamics and higher doses, different immune suppression. Yeah, does that keep you up at night?
The rationale for higher doses is that we're now dealing with a structural protein as opposed to an enzymatic protein. You just need more structure. You know, you need more wood beams as opposed to little, you know, other, in this case, if we're building a house. In terms of keeping us up at night, thankfully now we have six patients under our belt and we've reported out a safety profile that I think is pretty comforting. We're using a capsid now that we have experience with that seems to be well tolerated amongst all our patients thus far. I mean, we're always up at night thinking about our patients. It's just the business we're in. So far, so good. I think it's pretty comforting when you look, you know, we remember every adverse event in gene therapy.
When you look across really like the 2,000 or so patients that have been administered gene therapy, whether it's in preclinical programs or now in clinical stage commercial programs, the really serious adverse events are quite rare. We remember every single one. I think this is just natural maturation of the field. When you're dealing with morbid diseases like we're dealing with, I think the benefits clearly outweigh the risks and the patients agree with us.
I would just add one thing, you know, in terms of serious safety events or side effects, those typically happen at the highest doses. You know, once you cross 214 vector genomes per kilogram or higher, it's almost notable. You almost will see safety events almost get in a guaranteed manner versus you look below that dose, it's almost notable in the absence of serious safety events. In our view, safety is entirely related to dose. What we've tried to do is find a cardiotropic capsid that allows us to treat the diseases of focus, but do so at lower doses, which would typically mean it is safer. Across all of the studies we've run, we've never had more than a grade two SAE in any of our trials.
I think gene therapy can be unsafe at high doses, but at the right dose, with the right capsid, it actually is a safe therapy.
Why using rapamycin? Can you just maybe talk about that? Again, your competitors usually give more than that, if you will.
Yeah, so you know.
Why you're comfortable with just rapamycin in the.
As opposed to rituximab.
Yeah, correct.
I think with RH10, we're seeing, you know, the rituximab, the idea behind it is really to reduce complement-mediated toxicity, which you see in the first few weeks. What we've seen in our preclinical programs is almost no, there's no way around, but thus far, we haven't seen complement-mediated activation across our cohorts. It seems like the rapamycin with a sufficient level is enough to prevent that. On the other hand, rapamycin, you can stop. Rituximab, there's no refund. You give it, you deplete memory cells, your B cells, and you can't undo that. I think we feel more comfortable, you know, starting knowing that there could be adverse events with over-immunosuppression as well. We feel comfortable with our regimen.
That's very helpful. I'm not sure if I appreciated that. That's actually very helpful. Maybe again, I know early days, you only have shown us a handful of patients here, but like how are you thinking about the path here in terms of regulatory going forward? Like how are you thinking about endpoints? Again, I think one of the endpoints is very tangible, right? Like I mean, these patients have arrhythmias all the time. If you can show a meaningful reduction in arrhythmias, there's obviously very meaningful patients. Are you thinking that expression and maybe reduction in arrhythmias, those could be the two kind of go-to endpoints going forward for an accelerated approval? Or how do you think about endpoint selection going forward?
I think that's been a playbook for cardiac gene therapy now, expression plus an objective endpoint like MRI. I think it's early now in arrhythmogenic cardiomyopathy to say if those are the right endpoints for a registrational study. I think in terms of arrhythmias themselves, you know, that's something that may not happen frequently enough to serve as an endpoint in a registrational study, but premature ventricular contractions could. There are several other endpoints that we look at as part of this program that ultimately could serve in the same way to evaluate progression of the disease or regression of the disease. I think more to come on that as we have future conversations with the FDA and we see the data coming out of our high-dose cohort as well.
I think PVCs are possible, but that's not the only endpoint that one could consider associated with, you know, with this program from a registrational study perspective.
That's helpful. Maybe circling back on expression, I think the other big difference here versus Friedreich's ataxia is these patients already start with a pretty high level of expression just simply because of the genetics of this disease, right? Is there like a scenario where you can actually drive a more meaningful impact for PKP2 simply because you're kind of bringing at the end of the day the expression levels closer to normal, if you will, in this indication versus FA?
Yeah, again, I think it gets to the function of the protein. One is a structural protein. You know, I think getting closer to normal is ideal. We do not know where that bar is. We saw in one patient, we got up to 80% of normal. That patient had a significant improvement in arrhythmia. That is at our lower dose. We are already at a higher dose. We feel like we can get there in subsequent patients. It is different than in FA. Also, by the way, we have shown preclinically and now we have three programs showing preclinically that there is not a tox effect of this protein. If you have too much of this protein, it gets digested in the cytosol. That is different than frataxin, which is an enzyme which maybe you just need very little bits of.
In high levels, if you overexpress this, we do know that it can be toxic. You have a tailored approach based on the pathobiology of disease. That's what I think is going to be successful for all our programs and Lexeo 's success in general. Science first.
Sure, sure. All is science first. Maybe a last question. I know we're out of time. Maybe Kyle, do you want to talk about, you know, how you're thinking about financing the company? Obviously, you know, the market remains a choppy environment. Like in this condition, how are you thinking about financing the company going forward?
I mean, I think you saw in our latest quarter, we did implement some cost reductions that allowed us to really continue to accelerate towards the pivotal trial. I'll mention aggressively enrolling this natural history study. We've continued to maintain cash runway guidance into 2027. I don't think we're a company that's cash poor where any of our current activities are limited by the balance sheet. You know, we do need to expand the balance sheet a little bit to complete the pivotal trial. There are several options in front of us to do that. You know, one of those is through equity, but we've also told you that we've eliminated Lexeo's spend on our Alzheimer's program, for example, looking for some non-dilutive capital.
There are other programs we could think about, you know, bringing in a partner that would be value add to Lexeo in terms of maybe geographies that we have no intention of pursuing ourselves to supplement the balance sheet. We have some time to explore all those alternatives.
Got it. Super helpful. I have 300 more questions, but no more time. So Nolan and Eric and Kyle, thanks so much for joining us and talk soon.
Thanks for having us.
Absolutely.