Good afternoon, everyone Welcome to our Piper Sandler Healthcare Conference. My name is Yasmeen Rahimi. I'm a senior biotech analyst here at Piper. Really thrilled to have the team from Nektar with us. We have lots to cover in the next 25 minutes and a big year ahead of us in 2025. I think before we go through the, you know, just maybe what would be helpful is to kind of broadly think about, for investors who are maybe new to Nektar, why 2025 is an extremely important year for the company. And then I will dive into specific questions into AD and AA.
Sure. Thank you. It's our pleasure to be here. Thank you very much, Yasmeen, and all the Piper team for the invitation to join. And so for us, Nektar, heading into 2025 is a very major year, very significant for our company. So we've pivoted and focused our strategy and our pipeline into our immunology-based pipeline. And really, Rezpag, our Treg targeting drug is kind of the flagship, the keystone program there. And with that program, we have two very significant catalysts in 2025. In the first half of 2025, we'll be presenting results from the top line, the induction portion of a roughly 400-patient phase 2b study in patients with moderate to severe atopic dermatitis.
That's really building on the phase 1b data that we've presented and recently published in Nature Communications that really showed a very remarkable efficacy in patients with that disease. And then later in 2025, in the second half, roughly three to four months later after the atopic dermatitis results, we also plan to present results from our phase 2b study in patients with severe to very severe alopecia areata that are also treated with Rezpegaldesleukin . And that study is really building on the fact that in three different cutaneous conditions, cutaneous lupus, psoriasis, and atopic dermatitis, we've seen very impressive clinical efficacy with Rezpag. And so now we're extending that into patients with alopecia areata and other dermal disease just based on the scalp and the hair follicles.
So those are two very substantial catalysts for us that will really drive a lot of people watching, you know, the progress of our company.
For investors that are just kind of listening and learning more about Nektar, what makes IL-2 alpha such an important target for AD as we're going to start speaking about AD and we'll transition to AA later?
Sure. Yeah. So really, atopic dermatitis is a disease that's, you know, traditionally dominated by a Th2 kind of inflammatory, you know, endotype. And we've seen drugs that target the Th2 pathway really be successful in that space. Clinicians and dermatologists have long postulated the regulatory T cells would be a very attractive and important therapeutic axis to pursue in the treatment of this disease. And one of the reasons for that is because while we know Th2 is dominant, we also know patients present with mixed phenotypes. There is a Th1 component, a different kind of inflammation. Some patients have a Th17 or Th22 phenotypes as well. And one of the things that's so powerful is we know Tregs can polarize to any T helper effect. So even patients that have almost a personalized inflammatory signature, Treg can help control.
And so they've always been sought after as a key, key goal. And for years, IL-2 given in low doses, which was a regimen first pioneered by Dana-Farber and the Sorbonne University, has really been shown to be able to maybe double, maybe at most triple a patient's Tregs and has been shown to be clinically beneficial in a whole host of different diseases. But it's not really a regimen that you can use medicinally, and you can't really control the magnitude or really duration of the Treg response. With Rezpag, you can. So we can induce Tregs 10- to 20-fold over baseline. We can maintain those levels for even patients dosed six months and longer. So we really have come a long way with sort of putting the Treg into the center of a therapeutic treatment paradigm.
For the first time, having a drug that can molecularly access the Treg compartment in a very straightforward way is an easy injectable molecule. And then that gives us the ability to build off of our phase 1b data, which really showed data that starts to really validate the Treg hypothesis in atopic derm. And now kind of all of those ships and stars align for the phase 2 study that we'll be assessing that in a 400-patient cohort.
Okay. I think it's also important that Nektar really published very strong data and very clear, and I think you guys have presented throughout the whole last 12 months, continuous additional mechanistic data to ensure a high POS for success. Could you maybe talk about, you know, how you designed your phase 2b study, the elements that you kept the same versus similar? Because I think the other aspect is the translation of that small study into a larger phase 2b is going to be critically important.
Sure. Yeah. Thanks. So firstly, one of the things I'll just want to note and build on is that we have published three peer-reviewed papers on Rezpegaldesleukin, which is, you know, I think three more than our competitors or other companies that are working in this space. We're very proud of that. And we've demonstrated both from the initial design of the molecule in the first paper, which kind of went through the discovery through primate studies. And then we published our first clinical data, which captured both the single ascending dose and the multiple ascending dose study, which also moved into the lupus patient population in the MAD. And then in October of this year at Nature Communications, we published the psoriasis phase 1b and atopic dermatitis phase 1b data bundled together with some additional mechanistic correlates.
And so all of that really leads us to the buildup of the phase 2. So what was so important in the phase 1b data is that we saw a dose-dependent effect of Rezpag in a randomized placebo-controlled double-blind setting. And we saw a very rapid onset of efficacy. Patients dropped EASI scores as quickly as after the first dose of drug. And then we saw an impressive magnitude of response at the high dose. We achieved an 83% change from baseline, which is really a magnitude of efficacy really only JAK inhibitors, you know, can really consistently reach. And then when we stopped treatment at week 12, we saw a durability with the majority of patients maintaining their response through week 48 or six months after the end of treatment.
That included patients that reached an EASI 75, maintaining 71% of those patients maintained through the end of the 48-week period with six months off drug. Patients that reached a vIGA at 12 weeks, 80% of those patients maintained their vIGA response all the way through week 48. Really a level of durability that's completely different than the standard of care because we know that the IL-13 targeting agents or JAKs would have had relapses for the majority of patients over that time. When we approached the phase 2b study, we really wanted to essentially reproduce the phase 1b data, but with a larger patient population. The inclusion criteria is exactly the same. We define patients with moderate to severe disease as patients that have a baseline EASI score that's 16 or greater. They need to have a vIGA that's three or greater.
They need to have at least 10% body surface area of disease at baseline, which is really standard also for the field and very consistent with our other contemporaries, including large pharmas running studies in these moderate to severe patient populations. So the patient population is the same. The other thing that we saw in the phase 1b study is that while many people saw a lot of benefit at week 12 of induction, we designed that study to stop treatment to really isolate on the remittive potential of the drug. But here we know that's not really how you treat a patient. You'd never just stop treating them. You keep treating them. So we also have extended the induction period from 12 to 16 weeks.
So that's actually we think an even positive modification because patients will get more drug treatment at the time of assessing our primary endpoint. And then the other thing is into the maintenance arm, people are re-randomized either once a month or once every three months regimens. And we're going to continue dosing through week 52. So we also will have the benefit to see what happens when you keep treating. We think we might not have even reached our maximum efficacy because we'll keep giving patients drug for a whole year. We may be able to drive even deeper response. So there are some differences, but they're actually quite positive. And if anything, they're designed to make it more likely to have a higher POS for the study.
What is the study powered for? In other words, what product profile do you want to see in your data readout that would warrant the capital commitment to move forward into a registrational study?
Sure. Yeah. So we haven't, you know, discussed the statistical design or the powering of the study, but what I can say is that it's a 400-patient, roughly 400-patient study. And the reason why it's so large is because when patients reach that 16-week induction period, if they have an EASI 50 or better response, they'll be re-randomized to stay on the same dose of drug, but either at a once a month or once every three-month regimen. So our goal was to get a lot of patients into the maintenance arm. So we made a larger study design in order to, you know, fund both the induction and the maintenance arms. And one of the positives of that is that for the induction endpoint, our powering is very high because we have about 400 patients enrolled.
And then, in terms of what is our kind of ideal TPP, so the things that we really key on that we think is really going to be the key, the missing kind of missing effect for this treatment in this disease is there hasn't really been that kind of psoriasis-like efficacy increase. You know, we've seen great results with IL-13 inhibitors, but about 50% of patients don't respond. And of the patients that do respond, they can lose that response. And the hurdle is an EASI 75. It's not an EASI 90 or 100. So we think there's an opportunity to bring that kind of IL-17-like effect that happened in psoriasis or even the Stelara effect after a TNF. So that's one goal. We also see a rapid onset of action in our phase 1b.
So people started to feel the disease, you know, kind of subsiding as early as one dose. And that wasn't just for the PI, the physician-assessed endpoints like EASI and IGA. Even in the PRO, the patient reported outcomes, the POEM and DLQI patients started to see a benefit in those instruments as well very, very rapidly. And then we'd like to have that magnitude of effect. So we want to really push that efficacy. And then we've already demonstrated remittive potential. That's completely different than the existing standard of care. So we also want to build upon that. And we think those are three things that make for a really compelling TPP.
Okay. And then just a few housekeeping questions. I think top-line data has guided and 1H25, you guys have been very consistent on highlighting guidances on track. Maybe just verbally give us some strokes, how's enrollment progressing, like, you know, and that's one part too is like based on the discussions you have with your CROs at the time of the top-line, what are the type of measures you will have on hand? What are aspects of the study that may take a little bit longer to analyze? If you could talk about both quickly.
Yeah. So we started that study for atopic derm in October of last year.
Oh, wow.
We're very, very close to completing enrollment. I mean, one of the things we've been really happy about is we've seen right consistent enrollment with our projections from the very, very beginning of the study. We think that's partly attributed to the fact that we actually have phase 1b data. There are so many assets being tested right now where there is no data to base their phase 2 results on or their study designs even. We've been able to attract a lot of enthusiasm from the derm community, very high uptake, very high engagement with physicians. On ClinicalTrials.gov, I think we had listed May of 2025 as an end date. As we're very, very close to completing enrollment, we'll give more refined guidance. We're very, very confident we're right firmly in our first half 2025 projections. What is in that top line?
And so the primary endpoint of the study is the percent change from baseline in EASI score, you know, from the placebo versus the three treatment groups at week 16. And then at the time that we read out that primary endpoint, we'll also read out many of the secondary endpoints because that includes the responder analyses like EASI 75, EASI 90, vIGA, the Itch NRS. And also we'll report the patient-reported outcomes as well. So in a sense, it will be very, very similar to, for example, our EADV presentation in terms of the constellation of the endpoints. So those are the key endpoints in the top-line. And that first analysis in the study is the final analysis for the induction. But the study will not be over, right? Because in fact, the study goes with all people that enter into the maintenance.
They remain on treatment through week 52. And then at week 52, they go on a 52-week off-drug period to assess the durability and the remittive potential. So we expect roughly a year into the early part of 2026 is roughly when that maintenance period would end because that would be roughly 52 weeks from the end of enrollment. So there would be another, you know, data update that we would provide that would be on the 52-week maintenance period. And then a year later would be an update on the remittive potential. But one of the really powerful things about that kind of a design of the study is it makes that study almost like a baby phase 3, if you will, right? There's a 52-week treatment period. That becomes very powerful data that we can leverage as part of our registrational package.
And because we'll also have a 52-week off-treatment period, that would be data readouts that continue to be coming while the registrational program's ongoing and that can really, really set Rezpag up for success.
Would you need to wait for the maintenance data to be completed to start engaging with the agency or as soon as you have the data, you could actually start preparation and discussion?
Yeah, that's exactly right. Because the phase 3 program is an induction program. And then typically what you do is you have, you know, multiple monotherapy induction studies. You'd also have a corticosteroid combo induction study. And then you roll patients into a long-term extension. And those typically run for at least a year because that's your bare minimum for BLA. But most companies these days actually keep those going for more years just to continue and updating their safety databases to get ahead of some of the real-world data. So yeah, so you're actually with the induction data, you know, we're ready to begin discussing with the FDA on next steps.
Okay. How do you think about upon positive data, how would Rezpag fit into the current competitive landscape of AD?
Yeah. Well, we're a completely novel mechanism, right? And so we're really aware that the majority of things now are, if not targeting the same pathway in the IL4, IL13 receptor, you know, space. They're also targeting antagonistic pathways. And even the one known agonist that we know is being tested is an agonist of an inhibitory receptor. We're a completely different approach. We're agonizing Tregs. And you asked a question earlier about our biomarker and proteomic profile that we recently published. We induce so many pathways associated with immunoregulation, which is different than just trying to block pathways that are elevated in the disease. So it's kind of like there's that old saying, many roads lead to Rome. We induce many, many pathways that help the patient overcome the symptomatic and the underlying disease pathology burden that they're suffering with.
We have an ability to apply that mechanism broadly. We're, of course, targeting the biologic naive patient population now building off of phase 1b. We think there's room to move in the naive setting. We also know our mechanism, though, would be just as well suited even for people that have failed or exited off of a prior biologic. There shouldn't be any kind of reason to believe that those two mechanisms wouldn't cancel out. Of course, in the combination setting, which is sort of like the next frontier, again, you have a different mechanism to add to those other approaches.
Okay, and I always ask companies that have ongoing studies an unfair question always, which is, could you comment on what you see on a blinded basis across both of your studies in AD and AA?
Yeah. So it's not really appropriate to look at blinded data. We don't really do that. We've also taken every step that we can to ensure the blind of the study, you know, which is both at the site level, at the investigator level, at the patient level, how the labeling is done, how the drug is administered. You know, so we really, it's just not a good practice to do. It could call so many things into question. We pay attention to the enrollment curve. We pay attention to how the sites are doing, making sure they're on quality events or other things like that. So we focus on the execution of the study.
Okay. And then Jon, given that this, could you maybe talk about the strategies? It's a highly well-powered study, one of the largest, you know, phase 2b studies. But there's always in the back of investor minds, we said worry on high placebo and what would be an acceptable placebo range. So when you designed this, and also this is a study in biologically naive patients, so maybe could you talk about like what do you assume would be a fair placebo response? Which risk mitigation did you incorporate? Obviously, the size helps substantially.
Yeah. Yeah. So if you look across like the last maybe three to five completed phase 2 studies, nowadays placebo rates are ranging in that kind of 30%-50% range. And I think it's pretty common. You're seeing it kind of bounce around in that zone. So that has a lot to do with the current state of patients, you know, and even where the studies are done and access to, you know, dermatological care, which is very different in the U.S., very different in a G5 market than it is in another kind of a market. So you kind of see those kind of practice patterns. So what we've done in this study to help control and mitigate that is obviously the size, right? The larger the study, the more you have a kind of a rich and larger pool, which will even out, right?
You know, those kind of like bias effects. The other thing is we have a global study. So our study is active in both North America, U.S., and Canada. It's active in Europe, including Eastern Europe. It's active in Australia. So also we know that in certain parts of the world, you're going to have more severe patients. And our goal is always that our IGA 3 and 4, you know, it's at least, you know, 50-50 is a really good place to be, right, with a study like that. And that also really helps the placebo rate because the 4s tend to have a higher baseline EASI. And also we know in the 4, the severe patient and the higher baseline EASI, there's also much less of a placebo effect in those people as well.
Okay. Very helpful. I want to also make sure that investors understand that the study isn't biologically naive, but then the next step forward would be a developmental path both, right, and experience. But I think a lot of investors may not appreciate the thoughtful reason why you went for biologically naive patients and the fact that you were able to enroll over 400 patients starting last October, which is incredible. Could you touch upon that, like what led to the decision to focus on that and what the clinical implications are, you know, post the phase 2b readout?
Sure. Yeah. So the first part to the question is it's really the phase 1b dataset. You know, as important as that dataset is, the derm community really like presented it. Like even at EADV, you know, multiple years in a row, they would have sessions that we weren't even a part of where our data was presented as a new approach, the potential of a remittive therapy for atopic dermatitis, which hadn't been seen in this community at all. So there's been a very high kind of enthusiasm and the fact that we have data and it's dose-dependent in a randomized, you know, blinded placebo-controlled study has really, really helped that. So obviously our goal was with that already directionally differentiated dataset, we wanted to build off of that. That was our rationale in staying in the biologic naive patient population.
But then when we consider registration, we're going to want to go for as broad a label as possible. And yeah, and that includes the biologic experience. And that even of itself is its own kind of new population because is it a failure? Is it an incomplete responder? Is it intolerant? There are multiple phenotypes there. And also I think we'd be working with the FDA to really define that.
Okay. And then Tim, I know it's not fair to spend like three minutes on AA, but what led to the decision or what was the strongest evidence in your view that led to saying the commitment to really run the REZOLVE-AA study, which is expected to read out in the back half of 2025?
So we saw efficacy in patients with Cutaneous Lupus, with Psoriasis and atopic derm, three completely different dermatological inflammatory states, and Rezpag was effective in all three. So we really thought, okay, there's a lot of potential in derm diseases. We thought about Vitiligo. We thought about, you know, alopecia in particular. The second part about that is alopecia is a disease known to have a strong role of the loss of immune privilege in the hair follicle. We all have it. That's why we grow hair the rest of our lives. Our body doesn't think our hair follicles are tumors. Yeah, but in these poor patients, that's not the case. But we know that the Treg is actually a really important cell type for setting up that immune privilege state. And so our hypothesis was that bringing Tregs to the patients would restore privilege.
And then it's not like being on a JAK inhibitor where the second you stop taking the drug, the patient that grew hair had their hair fall out. Yeah, we should be able to maintain that remittive potential that's on atopic derm. So those were the two big reasons why we prioritized alopecia.
I think a lot of investors recognize AA has a high unmet need. What is, again, similar question that I asked Sanofi, what is the product profile you want to see in your AA study that would warrant further commitment to develop it?
So no biologics approved in AA. So we think AA is like what psoriasis was before a TNF was approved in that space. When a biologic comes into one of these diseases, it starts to create a lot of penetration and growth, even in a small market. The other thing is that, you know, while the JAK inhibitors have shown efficacy, you know, 30% at the high dose can reach a SALT 20, for example, placebo-controlled result. But the reality is not everybody can take the high dose. And there's a lot of tolerability and other problems with taking that mechanism. And again, if you ever have to stop for an adverse event, all that effort you put in growing hair goes away. So we think there's a whole kind of remarkable transformational opportunity to be able to provide a drug that durably causes hair growth in this patient population.
Perfect. And any maybe in the 15 seconds, are there other indications for which Rezpag mechanistically could make sense that you guys are contemplating and thinking about?
Yeah, absolutely. I mean, atopic dermatitis is just one atopic piece of the skin. Atopy of the lungs, asthma. I mean, there are really so many adjacent indications. And there are more derm indications, like we described other kinds of even more acute diseases and derm mentioned vitiligo. And I also am quite fond of diseases where you lose tolerance, whether they're transplant diseases or diabetic diseases or others where like food allergy, where you have lost tolerance and response to something that you really shouldn't lose tolerance for. It's really a place where the Treg helps you restore peripheral tolerance. Those would be other kinds of indications we could consider in the future.
Wonderful. Thank you so much for a wonderful discussion. And thank you for traveling and being part of our healthcare conference. Let's say thank you to.