Welcome back everyone to H.C. Wainwright's BioConnect Investor Conference here at Nasdaq. My name is Matthew Cowper. I'm a Senior Biotech Analyst at H.C. Wainwright. We're very grateful to be joined by Surrozen as our next participating company. We welcome Craig Parker, CEO at Surrozen, as well as Andrew Maleki, CFO. Thank you both very much for being here.
Thank you.
Good to be here.
Excellent, guys. Maybe to start off, could you provide a kind of a high-level view of Surrozen's platform, focusing on the Wnt pathway and how that could have important therapeutic implications for vascular renewal and repair as we look at retinal vascular disease?
Of course. Yeah. We're really excited about the opportunities that this biology presents, particularly in the eye. The company started off as a specialty or a specialist in focusing on Wnt biology as a way to regenerate tissue. Really decades of elucidation of this pathway, as a really critical pathway in biology pointed to this being a really great opportunity for therapeutic intervention to be able to activate the pathway for therapeutic benefit.
There are several human diseases that pointed the way towards one particular receptor in this pathway being critical for retinal vascular diseases. I won't go into the those diseases in detail. But they did highlight that Fzd4 in particular, which is one of the receptors in this pathway, is critical for normal retinal vessel development and normal retinal vessel function. When we started the company, we worked on developing a very drug-like antibody-based format for targeting the receptors in the pathway. There's a receptor and a co-receptor called LRP, and making these very developable molecules, so very well-behaved pharmacologically, very well behaved for being able to formulate into even intravitreal administration type of formulations. Pointed that towards some of these areas like retinal vascular disease, where we knew that one particular receptor was critical.
The thing we've done at the company was the discovery of the combination of formats, the specific antibodies that we're developing. What's really interesting about this biology in the eye is these rare childhood diseases suggest it's really important for retinal vessel development and for normal retinal vessel function. Some of these kids will have a mild phenotype when they're born, and then as they grow into adolescence, they'll start to lose their retinal vessel function and even vision. That looks like what happens in diabetics, you know, in their 40s and 50s, and then age-related macular degeneration, you know, in your 60s or 70s. That I think really pointed to the opportunity to intervene in this pathway for therapeutic benefit in these other diseases.
Mm-hmm. That's very helpful. I mean, there has been buzz around the Wnt pathway, obviously, for example, the Merck acquisition of EyeBio back in 2024, over a billion-dollar deal, as well as milestones as well. Are there other ways you see Wnt biology potentially addressing unmet needs as we think kind of broadly about retinal diseases?
Yeah. I mean, as most people probably know, the VEGF molecules that are on the market today treat these diseases quite well. You know, until the very first VEGF molecule was launched, it's now going on 20 years ago, you know, prior therapies had barely been able to slow the disease, and it's really great for patients that the VEGF molecules actually improve visual acuity. They actually dry the retina. That's been, you know, really fantastic benefit for patients. There are still some patients who have what would be called residual fluid in their retina. There are patients who have areas where they don't have adequate vessels. One of the hallmarks of this disease or both these diseases are that the retina becomes hypoxic, so not enough oxygen.
That's what stimulates VEGF production and this really unwanted excess vessel development. What also happens is you lose vessels, and you have these areas where there are no vessels. One of the very unique aspects of Wnt biology that you alluded to was the ability to regrow vessels in those areas. We think that's an opportunity to really differentiate the pathway and our molecule in human disease is to not only provide very good drying, which is really critical. It's what drives the treatment choice for retinal specialists, is how well the retina dries after you give the drug, but also be able to address these areas of what is called retinal non-perfusion.
These sometimes are areas that affect vision, sometimes they're more peripheral, but they're still believed to be and are correlated with more aggressive disease and more rapidly progressing disease. I think it could be really important, even if there's not an immediate visual acuity benefit or visual function benefit to address these areas of non-perfusion. That's what's really unique about Wnt biology. We've taken that best of Wnt biology, coupled it in our molecule with VEGF inhibition. We think that's really gonna be hopefully have additive benefit for on both those endpoints.
Very, very encouraging. One distinction along those lines in Wnt development is that Merck's phase I-II asset Restoret is a tri-specific Wnt agonist and Fzd4 binder, while lead asset SZN-8141 uses both the Fzd4-targeted Wnt agonism and VEGF inhibition.
Yes.
How do you view sort of overall the most important differences between those assets?
Yeah.
Is that kind of the core differentiation?
Yeah. You know, it gets very confusing when you start to talk about specificity and valency of these really complex molecules.
Sure.
The Wnt end of our molecule, and so the principle difference, maybe most easily identifiable difference between our molecules is they do not have a VEGF inhibition component.
Right.
If they wanted to achieve that, you would have to co-inject a VEGF inhibitor, and that has its own challenges to be able to get, you know, reimbursed, and have the patient agree to, you know, basically twice as many injections. The Wnt end of the molecule is doing the same thing. There are very different characteristics. We think our molecule is more potent than Restoret. It is in vitro. We'll see if that translates in vivo. You know, the most easily identifiable difference is not the valency or the specificity because they're binding two different LRP epitopes that may or may not be important. It's really this difference of adding the VEGF on and then the Wnt portion being more potent.
Okay.
It's really, it's not because of the specificity of their molecule for LRP, different epitopes of LRP5 that probably makes the difference. There are probably some other aspects t o the format where you put the binders, and the affinity of the binders that might make a difference.
Okay.
We'll see.
Understood. One point I wanted to make was Surrozen has its strategic partnership with Boehringer Ingelheim for retinal asset SZN-413 which had positive outcomes from its IND-enabling GLP toxicology study. how is that collaborative partnership and 413 progress provided further validation for the internal Wnt platform?
Yeah. we actually worked on Fzd4 quite early.
Right.
In the company's history, invented what became the molecule that we licensed to BI. You know, we had a really productive collaborative research phase of the agreement. At this point, it's a out license. You know, we're excited for them to get in the clinic. We don't know a whole lot more about their own, you know, plans or timing.
Sure.
Know because they had to pay us a milestone that they completed IND-enabling tox. You know, excited that there'll be another molecule that we're gonna get some economics on. You know, this partnership has the kind of typical additional milestones and royalties associated with it. Of course, we're excited for them to move forward, but don't really know anything about the timing yet.
Okay. I mean, as we think about kind of read-through from that development.
Yeah.
To the current internal development, SZN-413 had prior success in the preclinical models of retinopathy with Wnt signaling.
Yes.
Retinal vessel regrowth, pathological vessel suppression, reduced vascular leakage. Should investors separately look to the internal molecule SZN- 8141 that's in development either match or possibly better that profile? Like, are there kind of few distinctions for the natural pipeline?
Yeah. I mean, the reason we put the VEGF on is we think that certainly in the human, retinal vascular diseases could still be a contribution of VEGF, even if you're getting all the benefits that you see in preclinical models of the Wnt activation of the, all that you just listed. Obviously we've added VEGF on because we believe there could still be a contribution of VEGF to the pathology and human disease, and they don't have that component to their molecule.
Got it.
You know, we would hope to have all the benefits of the Wnt signaling along with the VEGF inhibition. You know, we also have a next molecule that adds IL-6 inhibition onto that. The Foundational story is the same. You know, take individual pathways that have been shown on their own to be individual contributors to the disease where the monotherapy has an effect, you know, put those into one molecule. There's growing data on the role of IL-6 in multiple retinal vascular diseases.
Yeah, absolutely. Very helpful. In terms of thinking about differentiation with standard anti-VEGF in wet AMD, for example, for those treatments with those treatment durability is lasting roughly two-month. Two months in terms of their intervals, maybe three- to four-month durability with EYLEA HD or VABYSMO, novel TKIs possibly expanding that to maybe six or nine months or beyond. How do you believe a therapy like SZN-8141 could be most kind of uniquely positioned within the landscape?
Yeah. I mean, I think durability is important. It's certainly important to patients to have the least number of injections.
Right
I think what's really paramount is retinal drying. I think if you ask retinal specialists, and you see this in some of the surveys, you know, as new mechanisms have emerged, I think you've heard retinal specialists talk a little bit less about the unmet need being durability and more about the unmet need being retinal drying. You know, three years ago, four years ago, there wasn't really an opportunity for better retinal drying. Now, you know, with multifunctional antibodies, with Wnt, with IL-6 emerging, I think we're seeing opportunities to achieve better retinal drying. Not saying, you know, patient convenience and durability are unimportant. I think we probably should hope to get to no more frequent than every 8-week injections. If you don't have better retinal drying, I don't think less frequent injections are gonna position you ideally in the market.
Yeah.
If you look at the actual use of VABYSMO, and this has been presented at conferences by multiple investigators and clinicians, you know, the average number of injections of VABYSMO is seven a year. In their phase III trial, 80% of patients got to every 12-16 weeks. That's not how the drug's being used.
Yeah.
You wanna make sure to never have fluid accumulation because that's what leads to vision loss. I think if you had better drying and every eight week, and we could have much less frequent than that, but if you had better drying and every eight week, I think that's the ideal profile. Ideal. Every 12 week might be ideal, but I think if you have better drying. The durability of getting past every eight weeks becomes secondary to the retinal anatomy effects.
No, I think that's very helpful. Kind of along those lines with maybe the benefits of targeting the retinal drying, are there certain types of patients in wet AMD or DME, for instance, that could be optimal candidates? Like maybe more advanced patients.
Yeah.
Maybe the earlier patients?
Yeah.
Maybe a little too soon to know.
No, I mean, I think, you know, we have, our head of clinical development is a retinal specialist. You know, he's asked this all the time, are there baseline characteristics where you could have someone who could predict to have a better treatment effect. I know he would say, you know, it's one of the, you know, challenging aspects of being a retinal specialist is so far no one's identified any baseline characteristics that tell you whether someone's a good VEGF responder or a durable VEGF responder. What he will also say is, if someone has a rapid response, that's predictive of a durable response. Prior to treatment, there aren't baseline characteristics that would help you identify responders versus non-responders or durable responders versus shorter term responders.
Yeah.
I know what he would also say is the psychology of retinal treaters is if something shows a drying benefit in one patient segment, you will use it everywhere. I think you see that in VABYSMO's commercial success. You know, that it was adopted very quickly and became, I don't know if it's exactly the market leader in every segment of the market, but, you know, it went from being launched and within a couple of years to being a $5 billion drug because of that better drying, and that better drying translating to utilization across, you know, treatment-naive, incomplete responders, DME, wet AMD.
Understood. That's very helpful and encouraging, and it shows there's still ample demand.
There's clearly still unmet need, right?
Yeah.
As beneficial as these drugs have been to improving visual acuity and clinical benefit compared to what we had, you know, 25 years ago, there's still an opportunity for better drying. Not 100% of patients are achieving a completely dry retina or absence of Macular Edema in DME anyway.
Also for SZN-8141 development, the IND is targeted for second half of this year. Even at a high level, what can the team share with us now in terms of hypothetical or actual relevant indications? Kind of what your thoughts are around highlighting the novelty and the benefits of the Wnt agonism in these initial indications.
Yeah. I don't, you know, I don't know that we're gonna break new ground on trial design.
Right.
Indication selection. You know, retinal vascular disease would all be relevant for this pathway. That would be DME, wet AMD, retinal vein occlusion, for our IL-6 containing molecule Uveitic Macular Edema because that's a more inflammatory driven disease. you know, whether you go after incomplete responders or not and try to show some benefit, I think is valuable, but it's challenging because their expected response is not very well characterized. There's no accepted definition of who an incomplete responder is. That's why you see many studies enroll treatment-naive Diabetic Macular Edema because it's the way so well characterized what their response to VEGF would be. you know, a retinal specialist I think would describe it as sort of the cleanest population with respect to the disease progression.
Sure.
Again, we're not gonna probably break new ground, but it would be- some combination of, you know, DME, probably treatment-naive DME, wet AMD, possibly retinal vein occlusion.
Yeah. That's very helpful.
In terms of, you know, one of the nice things as a drug developer in this field compared to a lot of other therapeutic areas is there's a very rapid response to these class of drugs, to the VEGFs at least, and in Merck's data to Wnt agonism. You see a treatment effect in weeks, if not days. It's clearly measurable at four weeks, eight weeks and 12 weeks. It could be, really, valuable and important to follow patients for a couple of more months to see what the durability is. You see a treatment effect very quickly, both retinal drying and visual acuity treatment effect really quickly. We would hope to see that better drying. You asked what would differentiate the drug.
Yeah.
There are well-established imaging modalities for measuring this reperfusion effect. There's OCT angiography and something called ultra wide field angiography, where you can identify these lesions that are ischemic or not perfused and see whether you've been able to increase the perfusion.
Very interesting. That could be something that could be looked at in addition.
Yes.
To visual acuity.
Yes.
To the drying-
Absolutely. Yeah.
Sort of the initial-
Yeah, yeah.
Um, sort of biomarker-
Yes.
Type endpoint.
Exactly.
Okay. Very helpful. One important pipeline distinction is that there is the additional preclinical progress for SZN-8143 w hich you've alluded to, that targets the Fzd4, anti-VEGF, and the IL-6, kind of the tri-specific approach. Can you speak more to the IL-6 blockade and its relevance to targeting inflammatory signaling for retinal edema and how that plays into that target?
Yeah. I mean, the IL-6 story is really interesting. I mean, this is not uncommon in medicine where, you know, case reports from drugs being used in a particular patient population where the patient has another disease comorbidity, leads to drug development of that mechanism in a different disease. In this case, there were people who had autoimmune diseases like lupus or, you know, there are a large set of autoimmune diseases that are associated with Uveitic Macular Edema, and these patients were getting systemic IL-6. When they went to their ophthalmologist 'cause they had UME, they could see that there was some improvement from getting IL-6 inhibition, probably at very low doses 'cause it was being given systemically t hat led people to look for IL-6 in the eye, and then observations were made that indeed IL-6 was elevated in some of these diseases like DME and UME.
That's what led to development of intravitreal injections of anti-IL-6 antibodies. What's been really, I think, encouraging for our approach is that there's now data from companies like Kodiak Sciences, for example, where VEGF plus IL-6 inhibition can lead to a very impressive drying outcomes in Uveitic Macular Edema, where it is a more inflammatory-driven disease. Also, there's been recent data showing an additive benefit of IL-6 to VEGF inhibition in Diabetic Macular Edema. Clearly it's a contributor to the pathology of DME. You know, the magnitude of that benefit, I think, you know, we'll just have to see with our molecule in the clinic. There's, I think, emerging evidence that IL-6 inhibition can add on to VEGF, you know, until our molecules in the clinic, we won't know.
Right
Provides additive benefit. There's certainly, growing dataset that IL-6 is important in DME as well as UME.
Yeah. No, very encouraging. Then also, I know we're a little shorter on time, but I wanted to touch on the ARVO presentation as well. Team highlighted preclinical efficacy of SZN-8141. Can you maybe just go through some of the high-level takeaways from the OIR mouse model that you shared?
Mm-hmm. Yeah. I alluded to this about what differential treatment effect we might see. This is a mouse model where you damage the retina in the mouse. You can see that there are leaky vessels, like in the human disease. You can see these areas where there are no vessels, like this, these areas of non-perfusion that I alluded to. In that model, what we've seen previously is that Wnt can address both the leaky vessels and the areas of non-perfusion. A VEGF molecule can address the leaky areas, but doesn't really do anything in these areas of non-perfusion.
That the combination in one molecule seems to have synergistic effects over each of those approaches individually. That's really exciting that there's something about combining those mechanisms into one molecule. By the way, we had a control, a cohort in this experiment where we mixed the VEGF and the WNT, and putting them in one molecule even had a better effect than just co-mixing, the two separate antibodies. Something about putting the two mechanisms into one molecule seems to have an additional benefit. You know, we'll see, does that translate to better potency, better durability? The potential is both, and the potential could be that, you know, that you're able to stay above a minimally effective concentration because you're so potent that you have a very durable effect.
Mm-hmm. Very encouraging. Maybe just in our last minute or so, obviously second half of this year, the IND for SZN-8141, that's kind of key to on investors' radars. Do you feel there's anything that's being underappreciated by investors about the platform? Is it just that they want to see that clinical validation?
Yeah. I mean, you know, there, I think there are few enough, a few enough scientific contributors to this field that people know we're one of those leaders, if not the leader. You know, there's really only one other group that is what ultimately became the Restoret molecule that had pursued this field and published on it. I don't think we've had a challenge convincing people, you know, that we're experts in the pathway, experts in being able to agonize the pathway with antibodies, experts in coming up with formats of these antibodies that, you know, look to be very desirable from their pharmacology and obviously desirable to partners. You know, I think people are pretty well attuned to the Merck data being really important.
That validation.
Proof of concept for the target. I'd say maybe what we've tried to emphasize is that, you know, let's say Merck's, and I don't know when they'll present this data, numerically isn't quite as good as VEGF. I think that's still very good for a foundational approach that's, you know, adding mechanisms. You know, they don't have to be exactly equal to VEGF for our thesis, I think to still be completely intact. You know, they clearly need to show activity, have clinical benefit, be safe, but I don't think they need to be exactly as good or a little bit better than the VEGF arm that's their comparator arm.
Right. Understood. Well, very helpful. Well, with that, thank you everyone for participating, and thank you very much to Surrozen.
Yeah.
We're very excited to get into the clinic here.
Yeah. Thanks for having me.
Very exciting. Thank you.