Good afternoon everyone, and thanks very much for joining us. My name is Brandon Folkes. I'm one of the Equity Research Analysts here at H.C. Wainwright. Next up, we have a fireside chat with Sagimet Biosciences. From Sagimet we have David Happel, CEO, and Andreas Grauer , CMO. Thank you to both of you for joining me.
Thank you.
Thank you.
Thanks for the invite.
All right, I think we're just gonna dive in because there's a lot to get to given the recent news and, coming out of the sort of or I'm gonna say focus, but enhanced focus on dermatology, right? Let's put it that way because dermatology has always been within your portfolio.
Yes.
At some stage. Can you talk about the potential role of a FASN inhibitor in treating acne, and why is it so compelling to have made this pivot?
Yeah, I think maybe we can tackle this one together, Andreas . I think from a, from a market perspective, it's highly attractive because there really hasn't been any innovative product or mechanism in this space in over 40 years since Accutane was approved in 1982. We all know that that medication can be effective in the most severe form of acne, but it also comes generally at a high personal physical cost to do so. We've always viewed the potential of denifanstat in a broader population, in the more moderate to severe population, as a kinder, gentler version of isotretinoin with a treatment effect that is seemingly approaching the same type of efficacy, but with a very nice safety tolerability profile.
When you consider the number of people, globally or in, and specifically in the U.S., who have moderate to severe acne, if you're looking at population, there are about 10 million-12 million in the U.S. that have moderate to severe acne, and their options are really limited to oral antibiotics, which everybody is trying to prevent overuse of now for all kinds of reasons, or topicals. While topicals can work, not as effectively as denifanstat, but they're certainly limited largely to the neck and above. Having an oral medication that's safe, well-tolerated, highly effective, that can treat the torso back particularly is a highly attractive option. In terms of why this mechanism works, Andreas, maybe you can share your thoughts.
I'd love to. I mean, if you think about the four key disease drivers of acne, right? Number one is sebum, that's the fuel. Number two is hyperkeratinization, which kind of plugs the pores. Number three is infection, which feeds off the fuel, right, the sebum. Number four is inflammation, you know, bringing it all together. When you look at denifanstat, it directly tackles one, sebum, and the inflammation part has a direct effect on inflammation. With regard to infection, by taking away the fuel, it also directly affects positively the infection part. It really hits three of at least three of the four main drivers head on, which makes it a very suitable drug mechanistically. Obviously these observations have panned out, right?
We've seen this based on the data from our partner in China, and it worked beautifully, just as advertised. Now we're excited to do this again, bigger, but the same thing.
Let's go with it, because you're in a very unique position, right, where you're setting up to run a phase III trial where I don't want to say we know the results, but we have seen Ascletis data, which is very, very compelling. Can you just talk about what we have seen in the Ascletis data to date? Then fundamentally, are there any differences in how a company would run an acne trial in China versus the U.S. that you can touch on just, you know, so the age demographic, but outside of just the age demographic as well, any other differences we should be aware of?
Yeah. I think, again, I think we can talk about this one together. In terms of what we saw from Ascletis and their they've run two clinical studies, a phase II and a phase III, that have largely been with virtually identical results. 20% placebo-adjusted reductions in lesion count, and that includes inflammatory and non-inflammatory lesions, with very highly statistically significant P values, as well as improvement in IGA, which is the International Global Assessment scoring system used for acne. And they've shown roughly a 20% placebo-adjusted improvement in IGA, again, across two studies. Based on those two studies and the output, they filed an NDA with the Chinese regulatory agency, the NMPA. That NDA was accepted in December of last year.
Let's remember that an NDA acceptance in China essentially reflects a PDUFA that we're familiar with. Now they're waiting on approval, which they expect to be sometime between October and January, February of this next year. We're expecting a fairly near-term readout from a major regulatory body on this data set and which is a nice milestone.
Yeah.
Maybe you can [inaudible] the differences in the patient population.
Right. With regard to the design details, they're probably more similarities than differences, right? The one difference you've already mentioned is that based on the FDA's suggestion, which was very welcome by us, to include 12 to 17-year-old adolescents into the trial. The makeup of the population will be a little different. We will include a significant proportion of adolescents into the trial together with the adults. That's a key difference. With regard to the inclusion criteria, it will be pretty much identical. Moderate to severe acne based on IGA assessment and lesion counts. With regard to the endpoints, it will be very similar, right?
It will be the so-called IGA success, which means that, you have to reduce your investigator global assessment count, by two points and achieve an IGA score of zero to one, which is clear or next to clear skin, which is exactly what Ascletis has done. We will look at inflammatory and non-inflammatory lesions as co-primary endpoints, and then the secondary endpoint structure will again be very similar. It's a lot of-- and the timing of the endpoint will be the same, right, 12 weeks as the primary endpoint. We will enter significant proportion of these patients into the open label extension. We will then mostly focus on safety. We've gotten a peek at the Ascletis', data in Europe, and it looked very promising in terms of continued improvement in efficacy. We're excited to see that as well.
In terms of the differences in the demographic, the pathology of acne is absolutely agnostic to demographic, cultural, ethnic background. I think that's one of the things that we were so encouraged by in the interactions with the FDA that they recognized that the data set from China should be replicated for a more diverse population.
Fantastic. Can you just talk about what are the gating factors between now filing the IND and perhaps between filing the IND and starting phase III?
Well, we're gonna be filing the IND very soon, there better not be any gating factors until we do that. That's happening, yeah, very soon. Obviously, we'll wait for any comments back from the FDA. We hope there won't be any material comments because it kind of laid out our plan for the pre-IND meeting and gotten their response, and we incorporated it. You know, all the significant suggestions from their side, we've incorporated. We hope that they will look at that favorably. We're gearing up to start up the study, and we hope to be able to start the study up by the end of the year and start recruiting.
You know, acne trials historically have been, you know, relatively, you know, straightforward or similar between sort of one company to the other. [Inaudible]. I guess, are there any questions or discussions between yourselves and the agency or any questions you would really like answered ahead of the phase III? Was it really just quite, I want to say procedural, because I think that takes away a bit of the hard work, sort of is the historical benchmark in terms of how acne trials have been run, one that we expect to consider here?
Yes. You know, the stability is a good thing in this case.
Yeah.
Dealing with known entities is helpful. The endpoint structure is a known endpoint structure, right? Which is what's important. The population we've already talked about. The endpoint makes sense, right? This is what people care about, is subjective improvement, the IGA score, and the lesion number. This is all good. With regard to the open label extension, it will be important for us to monitor especially a significant proportion of these adolescent patients for the remainder of the year by 12 weeks, double blind, and then open label.
Interesting.
That will be important for the safety assessment. That's a population that hasn't been studied by our Chinese partners. We don't think that that's going to be very different. We obviously have to at least try. Yeah, it should be very similar. We will try to make a very good case to these patients to get in the trial, stay in the trial, stay compliant during the trial. All of that is important.
Okay. I want to stay on that topic, right. I think that is a question that comes up a little bit, is that younger demographic that you'll study, how do you manage compliance in that patient population? You know, I could see it going two ways, right. one, you get success, so I don't need to comply anymore. Two, you get success, and you say, "This is great." You know, I wanna comply, right. I guess in a clinical, and, you know, that's fine in a real-world setting, right. In a clinical trial setting, how do you manage that for the open label extension part of it as well?
I mean, we will do our very best to very clearly communicate, right? Here you're for the adolescent population, you're really recruiting two people, right? You're recruiting the patient, and you're recruiting the parent. We will have to have conversations with both of them. And, as you say, success speaks for itself. We hope that for the patients on active, that will be a slam dunk. They will like what they see, hopefully, and want to stay on drug. We will also have to explain to them, like with other acne drugs, that if you stop taking it's gonna come back.
Yeah, I think that's the key.
It's in your very best interest to stay on the drug. For the patients that initially get assigned to placebo, for one, it will be a two to one randomization, so it will be fewer on placebo than on active. Second, we will guarantee them that they will be able to move to active in the open label extension, right? That is sort of part of the deal. If you make it through the first 12 weeks, you'll get on it. If you're not happy with what you're seeing in the first 12 weeks, it'll hopefully get better after. Again, the Ascletis data are really helpful there also because they've done that experiment that we will redo, right?
Where the initial placebo population goes on active, and it's really like a, like a parallel shift of the curve. This previous placebo population now gets treated. They improve just as well as the originally treated population in exactly the same times. We feel good to lay that out as an expectation when we educate both physicians and the participants in what to expect, that that is something they can expect.
I think you touched on it. It's the education process that we're going to be involved in. The fact that the data from Ascletis is so clean from a safety tolerability perspective, I think is going to encourage patients, you know, kids to remain on. The fact that we know that if you stop taking deni or a FASN inhibitor, that their baseline levels of FASN return within about four to six weeks, which means that they're going to start getting oily skin and then the consequent level of acne and pimples. Hopefully that part of the education can be eaten into then.
We're trying to build adolescent appropriate means of communication.
Yeah.
With our patient base, obviously we'll need permission first from them and their parents, but we wanna communicate to them through their cell phones because that's what they look at.
Yeah.
Yeah. No. yeah, you say you're treating two, but when it comes to 12, you're saying you know better than your parent, right?
No.
No, I think in that age group too, I think the allure of curing your acne or curing, but sort of managing your acne is extremely high, right? I think that's an incentive to be careful. I do wanna just touch on TVB-3567 while we're here. You know, how is it differentiated from denifanstat? What needs to be demonstrated in phase I to green light phase II?
Yeah. I think the molecule is more potent than deni. We know that. How much more potent and whether that potency translates into improved efficacy is one of the key questions that we want answered. We honestly won't know that until we get through phase II, which we'll have both phase III data from deni and moderate to severe and phase II data with our next gen molecule about same time by the end of next year. Our expectation is that with the potential increase in potency, we could see greater efficacy with as long as it doesn't compromise the nice safety tolerability profile we've seen with deni. It's possible that if we see the same treatment response and perhaps some benefits on the safety tolerability, that could also be a significant win too.
That's kind of what we're looking for, but we won't honestly know that until we get to the end of phase II. The phase I will certainly answer the dose that we're gonna take into phase II, and we are going to run a four-week cohort at the end of phase I to look at sebum composition and volume and the impact of 3567, the next gen molecule on sebum. That'll be, I think, an important, you know, metric for us to consider as we move forward.
Great. I do just wanna pause here and see if there are any questions in the room.
You mentioned Accutane as one of the long-standing products in acne. Could you talk about, like, the safety and the side effect of all your product and how it compares to the poor side effect care of the product?
I think it's night and day, right? I think that isotretinoin has a long history of it's a great drug. I mean, for cystic acne, it works. I mean, it works pretty quickly. It comes at a fairly high cost to the body in terms of the effect. I mean, it does change physiology of the body. It shrinks sebaceous glands and causes cell death. It has a permanent effect. Unfortunately, acne can still come back in those patients. It carries a REMS program, and it carries actually the most severe form of the REMS, iPLEDGE, which requires constant monitoring blood tests. You have to be on multiple forms of contraception while you're on it.
Therefore it makes it a difficult medication to adhere to even just beyond the effects on the skin and the eye, hair. With deni, we haven't seen any of that. I mean, we have some very modest skin, dry skin that we've seen in the phase II and the phase III study with the [inaudible]. The rate was about 6% on active, it was about 3%-4% on placebo, so actually fairly similar. That's largely been the only AE we've seen. We've seen some dry eye, the rate of placebo was about the same. The use of eye drops was about the same in both groups. You know, there's no GI associated with it.
There's no, we know obviously from our MASH data, there's no drug-induced liver injury, no other additional side effects. In fact, it's one of the reasons that the FDA encouraged us to look at 12 to 17-year-olds in the phase III. They clearly would not have done that if they felt that there was a safety tolerability signal. Obviously, we're really pleased with that. They asked us before we were going to ask anyway, but they had cross-referenced our end-of-phase II discussion with the hepatology division that we had MASH. Obviously our safety data is well known at this point. We've had over 1,000 patients tested at 50 mg once daily. It's a much, much different safety tolerability profile.
Maybe one more question, if I may.
Sure.
Can you talk about the strategy of potentially running a phase III in acne in denifanstat at the same time as a phase II in 3567? You know, will there be overlapping recruitment periods maybe to start? Will it be at the same clinical trial sites? You know, if the answer is yes on those, how does a physician decide which trial to put patient in?
Yeah, we would really not make them decide, right?
Yeah.
That's the strategy. The phase III trial, we're exclusively looking at U.S. sites for the phase III trial. The phase II trial, we're only looking at Australia as a location for the phase II trial. Whatever the location is, it will not be competing sites. It will not be in the U.S. because we do not want any channeling into one or the other trial that would be, I think, detrimental in terms of effect. We'll make sure they're set.
Fantastic. I know the clock says zero, but I'm going to ask another one if that's okay. Just because there is so much going on at the moment. I don't want to not touch on the topical.
Yeah.
I'm going to extend the time. You know, is this something that once deni is approved, you can move quite quickly through development? How should we think about the pathway for development here? Then maybe, you know, how do you think about a deni topical versus maybe a 3567 topical?
We're looking at both. It's an important program for us. The recent financing really was funding these three programs. denifanstat going directly into moderate to severe acne, 3567 going into the same population as potentially an open label extension, lifecycle management, as another oral FASN inhibitor. Third, the topical, which allows us to get into more mild patients, which is what we were really hunting for. When you consider there are 50 million patients in the U.S. that have acne, 20% of them, slightly more, have moderate to severe, and the bulk of them have some form of mild disease. Having an option for them or an alternative for them, we always thought could be a great idea.
We're looking at frankly, we're looking at both deni and 3567, the next gen molecule, and they're both in formulation development now. Our goal is to file an IND and get first in human at the beginning of 2028, and then we'll go from there. That's, I mean, it's, yeah, that's how we're approaching it.
Fantastic. A lot going on. I appreciate your time, and thanks so much for the discussion.
Thank you.
Thank you.