Good morning, everyone. Thanks for joining us here at the Leerink Partners Global Healthcare Conference. My name's Tom Smith. I'm one of the senior biotech analysts here at Leerink, and it's my pleasure to introduce our next company, Spyre Therapeutics, and their management team, led by CEO Cameron Turtle and CMO Sheldon Sloan. Gentlemen, thanks for joining us.
Thanks for having us.
This is one of our top picks for 2026. We think this company is really best positioned to capitalize on the emergence of combination therapies in inflammatory bowel disease. We also see the potential for TL1A to be a potential game-changer in rheumatology indications. Spyre is interrogating both of those theses intensively. We're gonna get a lot of data here over the next 9 months. We have 6 phase II readouts this year, a lot of data catalysts coming. We think we're gonna start to see that thesis prove out. Cameron, why don't you kick us off with a background, but maybe, like, a little bit of an overview for those in the audience who are a little bit less familiar with the story.
Yeah, you did it well. I think the short version here is that we're looking to create indication-leading products across the large autoimmune disease markets. We started this by making what we hoped would be optimized or kind of best-in-class versions of proven biologics across α4β7, TL1A, and IL-23, and then we're exploring them in 2 large phase II studies that are gonna start reading out this year. On the IBD side, we're testing these antibodies initially as monotherapies, and we'll show those data beginning next quarter. That study progresses to test the monotherapies against their combinations as well. It ends up being 6 different active arms, the 3 monotherapies and their pairwise comparisons against placebo.
We think that really is the future of IBD, and we think pretty uniquely, combinations are really dictated by whatever the weakest component of your combo is. I think we're unique in that our portfolio doesn't have kind of weak components. They're all these optimized antibodies, and I think that's likely to lead to best-in-class combinations. As you mentioned, I think beyond IBD, I think we and everyone else who's interested and invested in TL1A believes that this has the potential to be a pipeline and a product like we've seen in other I&I markets. TL1A so far has looked not just TNF-like, but actually TNF better in IBD, and I think we're excited to test that potential outside.
We'll have the 3 placebo-controlled readouts from our SKYWAY trial later this year, and we may actually see as many as 4 TL1A readouts from the other TL1A owners this year as well, which I think will really, over the course of this year, tell us how valuable this molecule is overall, and within that space, we think we have a improved next-generation TL1A antibody to capture that opportunity. I think it enters a really a pivotal transformational year and a bit for this company as we begin to read out these phase II studies and see kind of how many indication-leading products we have to advance.
Got it. I think when some people think about, like, the Spyre portfolio, people, they're familiar with the half-life extension, YTE mutation, but it's not as simple as that, right? Like, maybe just describe some of the optimization work that you've done around each one of these antibodies, and why you think they're, I guess, best suited for use in combination.
I think it starts with which mechanisms you pick, first of all. Actually, for interestingly, the same things that drive why something might be good for half-life extension also lead to why they might be good combination agents, and that is safety first, which is that when you're extending the half-life of an antibody, the thing you're most concerned about is avoiding any adverse effects that, of course, would last longer if you had an extended antibody. For combinations, same thing. You're looking for targets where you can potentially get additive efficacy without seeing additive safety concerns. We think the best bet for that is, you know, two safe things together is probably most likely to lead to a safe combination.
That's where we started with α4β7, I think it's fair to say is the cleanest target in IBD overall. We also think its mechanism is pretty unique in that it's a gut selective, blocking the trafficking of immune cells into the gut. I think it's quite likely that, A, that's gonna be well-tolerated in a combination, and also likely to be additive on top of other mechanisms. I think we've even seen data from Takeda and others in the last few months showing that you get additive efficacy of α4β7, even on top of JAKs, which, you know, those suppress quite a few different things. If α4β7 is additive on top of that, I think it's quite likely to be additive on top of TL1A and IL-23.
Anyways, that's kind of why we like α4 as a backbone here. Combining with TL1A and IL-23, these are also two mechanisms that don't yet have any known on-target safety concerns. We're not, you know, both extending the duration of these antibodies and then combining them together. We think, you know, together, these things make the most sense in terms of both in terms of long-acting antibodies, but then also for combinations. We've shown kind of getting into the clinic, we've done, you know, individual tox for each of these molecules, acute and chronic tox, and we've done combination tox for all of our combinations at this point and seen no adverse effects at any level for any of the molecules or combinations. I think that's, you know, that's the best place you can be at this point.
Yeah. Obviously, trying to optimize in a sense for dosing interval and less frequent dosing, but, I guess, what are your expectations on some of the other aspects of combination development? Depth of response or rapidity, like onset of action. How should we think about, I guess, like a clinically meaningful benefit over what's available via monotherapy?
I think the shortest answer is we don't know yet, actually, in terms of where you'll see the biggest differentiations for combinations versus the monotherapies. I think from the data we've seen to date, it tends to be true that the harder the endpoint to reach, the more combinations outperform the constituent monotherapies and certainly placebo. If we look at the VEGA study as an example, you know, the first randomized data set that we've actually seen in IBD combos, they had a benefit certainly on clinical response. It wasn't significant, but it was still a large benefit compared to the monotherapy components. When you looked at clinical remission, there you saw kind of a pretty striking statistically significant delta between the monotherapies and combinations.
In IBD, what's nice is we actually have kind of a number of different thresholds of measures to look at, starting from kind of response and then remission, and we have kind of mucosal healing and other things that are pretty difficult to reach as monotherapies. It wouldn't surprise me if as we kind of get more and more data for combinations, that's actually where you see the largest gaps between the combinations and the monotherapies.
Yeah. Got it. I wanted to ask about a data set I think investors have been focused on patiently, perhaps impatiently waiting for, and that's J&J's DUET data set. What are your expectations, I guess, around that data set? Maybe help kind of parse some of the J&J messaging, and then how does their strategy, I guess, inform what you guys are doing with your combos?
Maybe just the background for folks who haven't followed this space is that the J&J combination is combining SIMPONI or golimumab plus TREMFYA or guselkumab. I referenced the VEGA data set, which I think is what really kicked off this field and seeing this huge benefit in a naive population. They followed it up with these 2 large DUET studies looking at the same combination, but now in a population that's refractory to prior biologics. I think what's challenging about that setup is that golimumab in particular, you know, obviously, that's a TNF molecule, and I would say, you know, it's not one of the leading TNF molecules, but it's in that class.
If you look at the refractory patient population in IBD, where they ran a study in psoriatic arthritis as well, both of that refractory population most likely will have failed a TNF molecule. You're looking at a TNF combo in a population that has failed mostly infliximab or adalimumab. That's a pretty tricky setup in terms of where you're gonna see a meaningful benefit. For the last few quarters, I would say we've heard some, you know, caution around this data set as, oh, this might read through as negative to combos overall.
I've always challenged that kind of for this reason, but I think, you know, in the last few months we've heard J&J actually kind of change their messaging here a little bit and say, "Look, we think this is going to be the treatment of choice going forward. This is a future blockbuster." I think it's quite clear that they're advancing this to phase IIIs as well. I think all those weaknesses are still true in terms of the trial and the combination overall. If that worked, I think it's quite likely that if you replace a kind of not optimal TNF with an optimized α4β7 or an optimized TL1A, I think that's very likely to be a better combination.
Our trial design, of course, is also not looking at a trial population where everyone has failed one of our components. I also think that's likely to be a benefit to us as well. Overall, I think, you know, we generally are standing on the shoulders of J&J and the efforts they had here. I do think that it's I agree with them that that's gonna be a winning product and likely a blockbuster in this space. I still think that our combinations are likely to be quite a bit better and our trial design as well.
Let's get into trial design and how you're actually interrogating this thesis. You have the SKYLINE study. Maybe just walk us through the part A sort of monotherapy cohorts versus part B and what investors, I guess, can and can't conclude from results from the open label that we're gonna get, you know, starting this year.
Sure. This is a platform trial, basically we're testing six different therapies in the same population, ulcerative colitis patients. We're testing all our three antibodies as monotherapy and in combinations, as Cameron already stated. We're actually testing the monotherapies in part A at open label. Basically, open label started last year. The first one to go into the study was the first one available after phase I, which was the alpha four, beta seven. It was followed by the anti-TL1A, and now the anti-IL-23. What we're doing, we're enrolling this open label trial. There's about Morphic size open label study, between 35, 40 patients per arm. Once we finish our open label screening, we will seamlessly go into the part B.
Part B is the placebo-controlled study, which looks at 3 monotherapies versus each of the combinations versus placebo. It's a shared placebo, so it's a very efficient trial. At the end of the day, we're using about 40% less patients, a very ethical and a good use of resources. The beauty of having the run-in or the part A, not only we get validation that the mechanisms which we think we know work in these diseases, we just basically prove that, but also get sites up and running. The hardest part of clinical trials obviously is getting sites activated. This is a global trial, over 35 countries, over 300 sites, so it's a lot of heavy lifting operationally, and it takes time for getting all these sites up and running.
Not only are investigators super thrilled about having an open label study with half-life extended antibodies and mechanisms that we think we know work, but also it gets them familiar with the protocol and gets them a little more enthusiastic getting their sites up and running. When we flip the switch to roll Part B, we have many more sites activated, and we can accelerate the enrollment in Part B. Part B is looking at, again, the 3 monotherapies versus the combinations. What we hope to prove there in the monotherapy arm is dose ranging. We're doing a high and low dose, and obviously we wanna see what is the best combination therapy out of the 3 we're testing, could be more than 1. We also wanna solve for contribution of components in this trial.
I think that's kind of the setup of the trial. We're again looking forward to reporting the inductions, first and then obviously the maintenance. First three readouts will be this year, actually starting second quarter for monotherapy and then next year for the placebo-controlled double blind portion.
Yeah. Data right around the corner. Just building on that, like help us think about expectations for the SPY001 monotherapy cohort. Is VARSITY the right comp? I guess, help us understand, to the extent you have visibility into the patients that have been enrolled, are there important differences that we should be considering? Like, how should we think about that bar for success in the first monotherapy build?
I think I mean, none of these are first-in-class molecules, so we generally know how the mechanisms work across each of these and kind of what to expect across the primary and secondary endpoints. I think we've actually just put those data up in our slides so that everyone says, "Okay, here's a reasonable set of comparable measures for each of these." In terms of kind of what we would hope to see, I think across the three mechanisms, there's differing levels of places that we actually could see differentiation. I think on the IL-23 case, we think that those drugs have really been tested at the highest end of the dose response and exposure response curves, I'm not sure there's greater efficacy to be had there.
For TL1A, I would probably say the same thing. In the induction setting, we've seen three different data sets for three different TL1As and the placebo-adjusted efficacy, I think looks quite similar. Maybe not in maintenance. I think there might be a possibility to improve in the maintenance setting. For alpha four is one that we are testing to see whether it's possible to get greater efficacy than vedolizumab has in the induction setting. I think we've seen publications both from the pivotal studies as well as in the real world that higher exposures of the drug lead to greater responses. That's something we're testing.
We're aiming to put the majority, if not all of the patients in our cohort into the fourth quartile of exposure from what you see with vedolizumab to see if we can get better efficacy. I guess one thing that I would comment on and maybe ask Sheldon to add to as well, is I think we are using a set of pretty objective endpoints in this as well. Though it is an open label setting, I think these are not endpoints that you can kind of fake your way to a different kind of response rate than you would get in a blinded placebo-controlled setting. I don't know if you wanna comment on the endpoints.
So the primary endpoint for Part A is RHI, Robarts Histopathology Index, so change from baseline. You know, VARSITY had, I think, I get a good sense of the benchmarking with VARSITY as to VEGA, how that responded with that endpoint. It correlates fairly well, RHI to remission, so to the clinical outcomes. Besides the RHI, we're looking at another objective endpoint, from blinded reading is the endoscopy score. I think that between the RHI and endoscopy, we have two very objective endpoints. The readers of either the histology or the endoscopy do not know what arm the patient's in or what part of the study they're in, whether they're induction or baseline, you know, at 12 weeks or baseline.
It really is a, as objective as you can have it, not only for the open label, arm, but, I think for any study.
Got it. You've described it, I think, quite well as a seamless study design. There are, like, pretty obvious efficiencies that come with that. I guess one of the other considerations, like is there any way to incorporate learnings from Part A into this placebo-controlled Part B portion of the study?
Never say never. Since we are doing this seamlessly, you know, we still have patients in the study even before we that we'll be starting Part B before we have all the data from Part A. Let me put it that way. Is there anything we could do in a mid-course correction if we find something really different, unexpected? Maybe, but probably unlikely.
Got it. Okay. Of the combinations that you're considering, I guess maybe walk us through how you think like highest probability of success of them being synergistic, and is that based on, you know, what we've seen maybe in some real-world combination use, or is it based on sort of preclinical data that you've generated?
Yeah, maybe I'll start here, which is that I think there's good evidence for all three of these. We've looked at both human genetic evidence. There's variants that mimic each of these mechanisms, and we see that they have additive effects in terms of causing this disease. Theoretically, you would see the opposite in terms of therapeutically. Also, of animal models showing additive benefit of all three of these combinations together. I think the evidence is quite strong for all three. I think there's plenty of interest in speculating about which mechanisms will work best synergistically or additively. I personally think that the integrin is a very good combination component in terms of it is very orthogonal to the anti-cytokine mechanisms in terms of blocking immune cell trafficking to the gut.
I also think in terms of a disease that is a gut-predominant disease, having a combination where you're getting dual suppression in the gut with single suppression everywhere else, I think that is quite likely to provide an excellent risk-benefit ratio for these patients. That said, I think in terms of the, you know, the likelihood that TL1A plus IL-23 looks pretty similar to TNF and IL-23, but maybe better given that TL1A looks superior to TNF. I think the read-through from the J&J combo to our TL1A/IL-23 combo is perhaps the strongest. Anyways, I like all three of the children, but I think we'll see, and that's why we're running the trial.
Yep, makes sense. I wanna talk about again, coming back to, like, the SKYLINE design and execution. One of the issues historically within some of these UC studies has been elevated placebo response. I think we've seen some contemporary studies that have shown you actually an ability to have a quite low placebo response. Abivax is one that comes to mind. Maybe you could just walk us through, I guess what, You know, it's obviously not a factor for Part A, open label, but as we think about Part B and generating data out of the platform study, like, how are we managing for placebo response?
At my level, the management was hire the folks that have run the best studies most recently. I think that was both Sheldon, as the Abivax study that you mentioned in terms of having a very low placebo rate. Also the Prometheus team as well. Deanna leads the SKYLINE study here, and both of those studies had incredibly low placebo rates, frankly, despite enrolling patients in even in geographies where I think folks would typically ascribe the reason for why you see high placebo rates. I'm not sure that's necessarily the case if you have the right team running a bit. Maybe, Sheldon, if you wanna comment on some of the things we're doing to help minimize.
Sure. we've I think there's two parts to that. One is you can institutionalize in the protocol things that can help minimize placebo. In our study, we're really looking for patients with disease, active disease, and we've actually put a threshold of inflammation for inclusion as well as rectal bleeding. I think that will, for the first part, take care of a little bit of the noise that you see sometimes in patient, in IBD patients, may have a little bit of IBS overlay. I think secondly, which is maybe more important than anything is attention to detailed sites.
As Cameron already mentioned, we have a team that has executed trials previously, and a lot of that has to do with site engagement and instructing or getting the sites to the point of understanding where are the right patients and how to fill out the diaries. We've instituted some things from other playbooks from previous sponsors. We have a field force, MSL force. On top of that, even the staff, myself and Deanna, go out to the sites to visit investigators to just again, make sure that they understand our protocol, the advantages of the study, and get them excited. I think site engagement's a big part of it, besides the protocol elements.
Right. Okay. Maybe help us think about from a regulatory and clinical perspective, the contribution of components aspect to this, and the, I guess, clinically, like how do you think about the clinically meaningful bar for improvement over monotherapy?
Yeah.
Like I think, like investors tend to talk about maybe like 10 percentage points on something like clinical remission, but how do you guys think about it?
I think, I mean, we actually have pretty good precedent in IBD in terms of what is clinically meaningful in terms of differentiation, and I would point to, I mean we have three, I would say, strong head-to-head trials that led to dramatic changes in practice. Initially the VARSITY study of ENTYVIO beating HUMIRA, and then the two p19 inhibitors beating STELARA. All of those deltas, whether you look in UC or you look in Crohn's, the deltas were around 10% on clinical remission. In some cases a little lower, in some cases a little higher.
I think overall, those led to massive practice changes with about a 10% difference because it's a clinically meaningful difference, and this is a disease that is top-down, meaning physicians wanna use the best drug first because there are consequences of IBD that are irreversible and extremely costly to the patient, to their caregivers, and even to the health systems. I suspect kind of the future IBD treatment paradigm will continue to be a top-down paradigm in terms of using the best drugs first, and I suspect that will be combos, even if it takes a little while to prove it in terms of getting the studies done and advancing to that early line setting. I think that is what where the demand will be for the most effective agents.
That makes sense. Can you talk about, I guess how you're thinking about pursuing Crohn's? Like to me, like starting in UC makes all the sense, but where does Crohn's fall on the broader development path for Spyre?
Yeah. Sure. Our goal for the SKYLINE Study is to pick the combination UC phase III, but once we decide that, once we start our phase III program in UC, we intend to start a Crohn's program phase III as well with the same combination for a couple reasons. First of all three of our antibodies have demonstrated efficacy in Crohn's disease, so we highly anticipate a combination of those would also work very well in Crohn's, and we'll also see that validated in the DUET study. Secondly, we wanna merge our databases, so you need a certain number of patients to get your drug approved. By merging the databases, we have efficiency of having two studies and the safety database from both of them.
I think, you know, the other, I would say, gives us confidence that we can go to phase III is that this has been done many times before, where there's been 1 IBD study, demonstrated efficacy in phase II, going to phase III, and then the other study was started in phase III without a phase II.
That makes sense. I wanna switch gears to rheumatology and, you're running the SKYWAY Basket study for TL1A and multiple rheumatic diseases. Just talk a little bit about, you've alluded to this a bit, Cameron, but like scientific rationale for going after the diseases that you've chosen here and, Maybe a little bit more around study design. Are we going after advanced therapy-naive patients, experienced patients? What are we gonna learn from these initial cohorts towards the end of the year?
Yeah. In terms of rationale for this, we spent a couple years picking as soon as we had the phase I data where should we go with what we thought was a best-in-class TL1A. I think we really... the indications that rose to the top, and obviously why we picked them for the Skyway study, was based on indications where you really had all the evidence you could expect pre-clinically. One, there's human genetic evidence in all three of these indications. There's human tissue evidence in that TL1A levels and its receptor levels correlate with disease severity and they go up early.
Causal information we have from animal studies where in animals that both have psoriasis or arthritis, you can actually give them TL1A itself, and it makes the disease worse, or you can give them TL1A antibodies, and it makes the disease better. It's really kind of the totality of what you can have in terms of proof of concept before you go into the clinic. Mechanistically, we also like TL1A in particular in RA. Kind of, you know, the TNF and TL1A overlap looks like a Venn diagram in terms of the pathways that they hit.
one area that's specific to TL1A is its impact on fibroblasts, and in RA, the fibroblast-like synoviocytes are a kind of a cell type that is known to drive RA, and they express DR3, and they express it more in this disease state, and we think that means this could be an indication where TL1A is even better than TNF from an efficacy perspective. Maybe lastly, not beyond the science here, we also saw these indications as, you know, interestingly lighter pipelines in terms of competitive development in these space, despite the size of these markets. Cumulatively, almost a $30 billion market. Still substantial branded opportunities in these space as well.
If the TL1A behaves the way we hope it could, which is that, you know, so 2 to 4 shots a year would be the most convenient product in these spaces. So far, TL1A doesn't have any safety effects that would lead to the black box warnings that you see for every product in RAs except one. If we see efficacy that's in the range or better than the existing classes, I think this is a big opportunity from a revenue perspective.
Yeah, that makes sense. In these initial proof of concept cohorts, are we angling more towards advanced therapy-naive patients or experienced patients? Like what's the patient population across each of these?
For all three, we're aiming for a mix, about a 50/50 mix of kind of naive patients versus failures of advanced biologics. You know, these are, these are first-in-class proof of concept studies, the goal is to see kind of a relatively broad, kind of exploration of the efficacy here. Of course, we'll actually see some of our competitors testing similar populations or some selecting more of the other, so we'll get to learn from what everybody else is testing as well.
Yep, how do you think about sort of bar for success, go, no-go decisions across each three?
I alluded to it a little bit previously is that I think in terms of an attractive, you know, commercial product profile, you need to be differentiated on at least one, if not more of one of the three parameters I mentioned: safety, convenience, and efficacy. I think it's quite likely that we have it on two of the three just by molecule design, certainly on convenience. On TL1A safety, it looks good, really the last thing we're looking for is that efficacy is really at least as good as the existing classes or kind of in that range. If you're in that case where you're better and even similar on efficacy, that's probably the first branded product chosen.
I don't think we're, you know, suggesting like we may be in IBD that it's a possibility to come really early in the treatment paradigm. You probably do need to step through a biosimilar or two, yet I still think that's a large commercial market given that this is a disease area where you cycle through multiple products and do not stay in remission for the long term on a single product.
Yep, that makes sense. You mentioned TL1A having an impact here on the fibroblast-like synoviocytes. I'm just curious, within SKYWAY, have you incorporated any kind of like unique PD or imaging analyses that may be able to allow you to tease out like a differential effect relative to some of the other therapies?
I'd say our sub studies are very similar to the other previous sub studies in these spaces, not looking for anything particularly distinct about kind of TL1A's activity. I would actually probably point you to not our trials in terms of where we might see better evidence of TL1A's anti-fibrotic effects specifically, and I think in particular the SSCI LD and MASH studies that we may see as early as this year, those are kind of, you really are heavily relying on a strong anti-fibrotic effect to have efficacy in those disease areas, which we would love to see as well in terms of the opportunity in anti-fibrosis would be, would be a great option for us. I think it's great to see somebody else running those POC studies.
Agreed. You called out I think maybe up to 4 sort of rheumatology readouts outside of Spyre that could come this year. Is there any one that you are particularly focused on or excited about that we should be tuned into?
The four are SSCI LD, atopic dermatitis, MASH, and HS. I mean, these are, for the most part, very large markets. In the long run, I think we have differing views in terms of probability of success across each of them. My view of probability of success will change a lot depending on what we see from those phase II studies. We'll really, once we see the product profiles for what you can get with TL1A efficacy in those indications, I think when we sub in the idea that we have 2 to 4 shots a year of a molecule in those spaces, I think we could imagine the kind of the phase III costs and the commercial opportunity would look attractive in those areas as well.
I think there's a range of probability of success, but let's see the data and then, before making a guess.
Yep, makes sense. Just in the last, 30 seconds or so that we have, you just recently hired a chief commercial officer. Will you just talk a little bit about the rationale for bringing her on board now and I guess how you envision her helping, I don't know, incorporate some feedback into like future trial designs?
We're super excited to have Kate join us from Amgen in the last couple of months here. I think really you might have kind of hear the big questions that are coming for the next year and a half for us, which is that we'll have six readouts this year, the combination readouts next year. We're looking at ulcerative colitis, Crohn's, these rheumatology indications, plus the other four indications where TL1A is being studied. It is a pretty substantial commercial opportunity in front of us, and I think our main goal and commercial strategy is looking at those indications, and once we know the profile of our products in these phase II studies, seeing, okay, what is the revenue potential in each of those?
We of course know what it would take to run a phase III in them and really look across the board and say, "Well, where is the ROI the highest for us to go pursue on the back of these phase II studies?" That really is her primary effort. Of course, we'll do, you know, the physician and patient research, but I think even most importantly in kind of today's market is understanding how the payers are going to react to these new products in each of these spaces as well, how we think about pricing, what line of access and reimbursement we can expect, and that's something that I think Kate is gonna be leading for us.
That's great. All right. Well, unfortunately, we're up against time, but wanna thank the Spyre team for joining us and ton of data coming this year. Obviously, an exciting story to stay tuned to. Thank you, Cameron. Thank you, Sheldon.
Thanks, Tom.
Thanks, Tom. See you guys.