Great. Good afternoon, welcome back to Oppenheimer's 36th Annual Healthcare Life Sciences Conference. I'm Leland Gershell, one of the biotech analysts with the research team here at OpCo. We are truly excited to have with us as our next company, Protara. Protara is a public company.
Ticker is TARA. We've been covering the company for some time and like the story very much. On behalf of the company, we have CEO Jesse Shefferman joining us for a fireside chat, please submit any questions you want us to weave in through the portal, we will do our best to include. Just want to give a big welcome to you, Jesse. Thanks for joining us.
Thanks, Leland, and thanks to the whole OpCo team. You guys have been long friends and long collaborators, so it's great to be here.
Terrific. Yeah, let's sort of get right into it. You know, you've got two assets that you're developing. We'll talk a bit about TARA-002, which is your cell-based immunopotentiator first, and that's in two indications. Non-muscle invasive bladder cancer, NMIBC, and also lymphatic malformations, and it's in late-stage development for both of those. Maybe you could describe this candidate just in a little bit more detail for those of us who may be less familiar with it.
002 is pretty interesting in that it is a bacteria, a whole cell bacteria, that undergoes a level of engineering through manufacturing to be completely inactivated while retaining its antigens, right? The immune-stimulating properties that, you would normally be associated. It's a genetically distinct strain of Streptococcus pyogenes that was immortalized in 1967 in Japan.
Because the engineering process leaves the bacteria inactivated, there's a degree to which you can kind of control genetic drift, which I think is a concern. The only other kind of bacterial therapeutic that's out there is BCG, which is a tuberculosis vaccine and is utilized pretty extensively as frontline therapy in non-muscle invasive bladder cancer.
When we acquired the global rights to this drug, which in Japan has been on the market for decades, it's known as OK-432. It's the standard of care for lymphatic malformations there of the macrocystic and mixed type. It also has a label in head, neck, and thyroid, gastric, and lung cancer, where it's been used adjunctively with chemotherapy for a long time.
Our contention is that this might have been the first ever employed immuno-oncology agent, although they didn't know that at the time. You know, we are prosecuting this bacterial therapeutic, as you mentioned, in NMIBC. We have a registrational study in BCG-unresponsive CIS, which we just earlier this week, in conjunction with the ASCO GU conference, put out an interim analysis.
we also are doing, you know, study start-up work for ADVANCED-3, which would be a study utilizing TARA-002 in the front-line setting as an alternative to BCG, and potentially in the BCG-exposed or inadequately treated population that has grown significantly owing to BCG shortage. there, we're getting that off the ground.
Finally, we are running a study of TARA-002 in macrocystic and mixed cystic lymphatic malformations, put out interim data on that studies, the STARBORN-1 study, back in November, and are currently working diligently towards an upcoming FDA engagement, where we will delineate and hopefully reach agreement with FDA on a registrational path forward. A lot's going on with TARA-002.
Excellent. Yeah, earlier this week, you reported the updated data from ADVANCED-2, which is your ongoing study. You have patients with BCG-unresponsive NMIBC, who've been getting TARA-002, and the formal presentation at ASCO GU, I believe, is tomorrow.
That's right.
You know, we all got to see it when the embargo lifted. You know, I think the takeaways were 68% complete response rate at six months. That was out of 22 patients. You also showed us a preliminary CR rate of 33% at 12 months, that was just 15 evaluable patients. You know, this six-month rate is, I think, the best we've seen across those other programs that are out there, right? Inlexzo, which is approved, you've got Anktiva, which is given with BCG, Previstimogene, which is Seagen's product, Tetilimagene, which is in development at enGene.
I guess, you know, look, the market had a little bit of weakness off the 12-month, which maybe people were just comparing across the line and saying, "Well, I don't know, 33% may be a little bit low here." You know, for those who missed, you know, you had a great webcast with Neal Shore, who's a top thought leader. You know, please, you know, just share with us kind of how those 12-month data should be interpreted given the stage of the trial?
Yeah. I mean, the reality is, and this is the case throughout oncology, when you're doing a landmark analysis of response, you know, you will always... When you first kind of release or reveal a data at a, you know, sort of a canonical time point for evaluation, you're always gonna be carrying your earliest failures forward without the benefit of, you know, patients who were dosed at that same time point and are in response, but not yet at 12, contributing.
You said, how can we interpret that? I would interpret it as we know it's not durable. We don't know the degree to which it is durable. We have told other investors that, you know, the peril of small numbers, or small ends in oncology were at play here.
What I can tell you is, as we were preparing for the, you know, the data release at ASCO GU, we had two patients yet to read out, and we were well within the mid-40s at that time point in terms of our, you know, 12-month response rate. Both those patients unfortunately came in against us or were not no longer in response, and that moved the number lower. That just shows you sort of how volatile. I think, you know, look, I think it gives us a measure of comfort as we've seen sort of what we believe is a, you know, sort of a curious reaction by the market, because, again, that six-month number is the best anyone's done.
But as we've looked at it, we've said, listen, if those two had gone our way and we were way up into the 40s, but only on 15 patients, would we have gotten credit for that? I think probably people would have said, "Need to see more data," and that's the truth. These are the first 15 patients of a 100-patient study.
We're very confident that we're gonna be back in the 40s as this thing levels out. You know, what we have said is, as the numbers become more interpretable, and to us, that's got to be north of 20. As the numbers become more interpretable, what we see is that prior BCG exposure is not such a big driver of response in TARA-002 patients, right?
Now that you've got, I think, interpretable 6-month numbers in both the naive cohort as well as the unresponsive, you've seen those numbers converge. Finally, what we've observed again, is the ends get, you know, more interpretable. For instance, in our naives, the first time we published 12-month landmark data in the naives, we showed a 43% 12-month response rate.
The next time, we showed a 52% response rate at 12 months, and then in this most recent data set, we showed 58%. There is some... You know, if you want to believe that these two are generally gonna wind up looking alike, I could never tell you where I believe the final 12-month number will be in the unresponsives, but there's certainly a lot of plausibility that it would get back into the 40s.
Yeah. That's really helpful. Again, we're all looking at, you know, these rates, these six-month, these 12-month. At the end of the day, there's other factors that I think, you know, are important, from our conversations with community onco, community urologists. You know, how does, how does TARA-002 sort of, you know, line up in the landscape in terms of what would be reasonable and easy for a community doctor to want to reach for versus, you know, some of the other agents?
Yeah, I think you've really delineated, I think, what maybe the mid-game or end game is for everybody in the NMIBC setting. The reality is, nobody is going to generate $1 billion in sales, prosecuting a commercial strategy around BCG-unresponsive CIS. Right? That is not a particularly large population. What it is it's the fastest path to registration.
We look at some competitors, for instance, a very large pharmaceutical company based in, you know, Elizabeth, New Jersey. They have multiple studies across multiple patient phenotypes. Their first approval was on BCG-unresponsive CIS, because that's the fastest path to approval. Now you're in the fridge, right? Now you are in the pharmacy.
It's a, it's an option for docs to reach for, they will do so based on the appropriateness of that treatment for whatever patient is presenting at that time. One of our other competitors that we get compared to a fair amount, is really investing heavily in low-grade intermediate risk, though they have a very, I think, robust and mature data set in the BCG-unresponsive setting. For us, ADVANCED-2, like our competitors, is the fastest path to registration.
Where we see ourselves really capturing a big chunk of this market is through our ADVANCED-3 study in sort of frontline plus NMIBC, sort of BCG-eligible, unable to, or inappropriate for BCG. Add on top of that, the exposed population, which I think everybody agrees, you know, numbers in the tens of thousands in the United States annually, that's our big swing.
For us, ADVANCED-2 gets us in the discussion, right? We'll be fully enrolled, you know, comfortably before the end of 2026. You can assign whatever kind of timeline you want for filing and approval, but pursuing that study and its completion gets us into the urology practices.
It gets us our J-codes, it gets us our 3PL set up. It sort of allows us to be in that discussion just like everybody else, while we are preparing, perhaps 12 months later, for the completion of ADVANCED-3, which again, gets us a label. It has us doing so with level 1 evidence, given it's an RCT. It's gonna help us in guidelines, it's gonna help us in reimbursement, it, right now, it really is only us that is pursuing this particular slice of the pie.
Hope that makes sense.
You know, that's an excellent point. You know, you've had a pretty favorable regulatory update there, it looks like the FDA is not asking you to do any sort of head-to-head with BCG, but using, you know, kind of chemo comparator there. That looks like, you know, the kind of picture which would be, you know, attractive for success. As you say, like this is a much bigger market. Are you able to sort of frame the unmet need here and then kind of what the treatment gaps are in the-
Yeah.
in the BCG-naive, high-risk.
Yeah
population? Yeah.
Ultimately, you know, and we are currently involved in written engagement with FDA about how we ought to treat the exposed population. Let's park that over here for a while, 'cause that could be a significant increase or, you know, perhaps even double the number of patients that we would hope to address just in that sort of BCG alternative.
We went to the FDA with seven years' worth of claims data for NMIBC patients, and for those patients, you know, across those seven years who were BCG eligible, right? They didn't have the diagnostic code for BCG refractory. Ergo, they would've been BCG eligible. Approximately a 35% of the patients that are otherwise BCG eligible didn't get BCG. The question is: why didn't they get it?
Of course, there's a shortage, as we dug into that, we observed that a lot of patients are refusing BCG, right? This is a pretty well-informed patient population. They know of sort of the benefits, the drawbacks to BCG. For some of them, they were refractory to BCG. I'm sorry, not refractory, but intolerant to BCG. Might have gotten started on an induction course and for whatever reason, didn't tolerate it. You know, that's the sort of the phenotypes that comprise this 35%.
Of that 35%, and that number, just roughly for everyone listening, is between 11,000 and 15,000 patients annually, based on that claims data, again, that we showed the FDA, and that formed the basis of their approving us to run ADVANCED-3 in comparison to Gem or mitomycin, investigator's choice. About 50% of those 35 get gemcitabine monotherapy. About 35%-40% of those patients get mitomycin, and then the remainder get Gem/Doce. It's a small number, about 10% or ish, not, you know, get Gem/Doce.
We showed the FDA, like, "Look, NMIBC is a highly immuno-responsive tumor setting, and for the frontline patients out there, if BCG is not appropriate, there ought to be another immunopotentiating agent that a doc can reach for that highly immuno-responsive tumor setting, where maybe chemo is not the most appropriate."
We think chemo tends to have different results with, you know, kind of papillary and concomitant papillary disease. We can talk about that later. That should give you a sense. That's that unmet need. It's about, you know, kind of 11,000 patients -15,000 patients per year that don't get BCG, that should or could, or otherwise on paper, would. For the exposed population, you know, there are estimates out there that that's another 50,000 patients per year.
I think that's a little bit of a high number, but you can imagine it is tens of thousands, if not. We're looking at a possibility of addressing anywhere from, let's, 11 to 20 or more thousand patients a year, if you combine this sort of BCG alternative frontline, along with exposed, for which really there is no option but chemotherapy.
Right. Yeah, it seemed, you know, for those who are intolerant, you know, I think if you're approved there, that's kind of a go-to as an alternative.
Mm-hmm.
Given that you're not looking at it, versus BCG per se, do you think docs will care about the lack of that data, or do you think you'll be able to play in, you know, those who could be BCG eligible, but could actually get TARA-002 instead?
Yeah, listen, I think it varies, Leland. You know, I think you, one of the things I appreciate about the way you approach this setting is you really do reach out to a range of different types of, you know, voices in the NMIBC treating community, and different docs care about different things.
You know, it tends to be in the academic setting, you know, what we're looking for, what they're looking for is sort of durable, big response. You know, their practice flows do become a concern there as well. You know, there, I think, GemDoce, which takes, you know, upwards of two hours to administer, you know, they have the luxury of being able to take that on.
They're probably better staffed than a community site, a lot of the pick and act work that's done in that, you know, administration, that is done not by the physician, but by his staff or her staff. You know, a GemDoce is maybe a little bit more interesting. Again, when you get out into the community, what they care about is ease of use, tolerability.
They don't wanna have to retrain their staff, they don't wanna have to sort of undergo special handling education, they don't wanna you know, all that stuff that we know is a real, true, viable narrative, for treatments in the NMIBC setting. We would just wanna give them an alternative that is, you know, reimbursement doesn't have to be a question, supply doesn't have to be a question.
I think another thing that we hear is, even if BCG isn't in shortage at the moment, it has undergone shortages since 2017. There's a whole generation of uro-oncologists that have sort of gone through residency and into their practice, sort of understanding that BCG isn't in shortage now, but it might be down the road.
You know, one of the things that we hear is, "Listen, I can get my patients started with 6 induction courses of BCG, but I can't promise them that I have all 27 doses that they're likely to get." If I can't get that, promise them all 27 doses, but I can promise them 27 doses of TARA-002, that's a real reason to utilize TARA-002, even if BCG's around.
Yep, we could spend a lot more time talking about just this part of your business, but you've got two other programs.
Yeah. Yeah.
I think people are finally, and deservedly so, looking at, the LM.
Mm-hmm.
STARBORN-1, we saw, you know, pretty good-looking interim update there. I think you're awaiting kind of final, you know, alignment, maybe, with the FDA.
Mm-hmm.
ahead of getting the final start for one day. Maybe just, you know, kind of give a quick wrap on what we've seen so far, from that data set.
I think just to start off, you know, as we think about the portfolio, you know, if you think about it, in December, and now again, here in February, we've published on what is effectively the entirety of available data across our programs in NMIBC. You're gonna see us focus a lot on LMs.
You're gonna see LMs sort of elevate in terms of, you know, kind of the amount of air time it gets when we talk about the opportunities in the portfolio, 'cause I think we've answered some questions in NMIBC, and, you know, we've got some breathing room, if, as it were, to kind of really bring LMs to the fore. I'll just tell you kind of exactly where we are right now in the LMs program. We continue to enroll patients.
We have dosed certainly more patients, and more patients have read out since that November data release. We have a meeting scheduled with FDA to discuss a registrational path forward. The FDA has brought into that meeting setting representatives from multiple disciplines across the agency, which I think is good. We're confident that we'll be able to provide a degree of certainty around the regulatory path forward from here, and at that same kind of time, be able to provide another interim look at how the data are evolving in the patients within STARBORN-1.
Great. Good. Yeah, you know, obviously a much smaller number of cases out there than in the NMIBC world. You know, you've got excellent safety. The other options these patients have are not very good: surgery, you know, sclerosing agents that have all sorts of, you know, their own toxicities. I think you've quoted something like 1,400 incident -1,800 incident cases per year in the U.S.
There's also, many patients who are just sort of, you know, out there with these malformations. Could you give us a sense of, you know, what you could see for kind of a peak opportunity, if not in dollars, then maybe just in patient population segment, of the LM population?
Sure. Look, I think, you know, if you can get to about 1,000 patients per year, that's gonna be comprised of some incident patients. It's gonna be comprised of some treatment-apathetic patients coming back into the seeking treatment population.
There is this dynamic of because there's been nothing that's been as effective as TARA-002 in this setting, there are patients out there that are living with some version of prior pre-treatment that has not been successful.
Those patients obviously become apathetic. They, you know, go back into their communities and sort of are living with their disease. I think, you know, if we could think about somewhere on the order of 1,000 patients -1,200 patients being comprised, majority of incidents, some chipping away at prevalence, that's a pretty good number to think about.
Yep. Any ability for you to sort of segregate pricing, given the two different markets here?
Yeah
... within the 002 context? Yeah.
We're really lucky to have on board Bill Conkling, who is our Chief Commercial Officer and has some experience here. The reality is that the dosage presentation, the distribution channel, the SKUs, you know, coding, all that sort of stuff, because the LMs' presentation is 1 KE, and there's, the regimen is up to four doses, that compares over to the NMIBC dosage presentation, which is 40 KE, and as many as, let's call it, 21 vials used in that first year. That's vastly different. You'll see different brand names, different distribution channels. What you're looking for is auditable revenue streams, right?
I think because the benchmarks that have been established by some of our competitors in the NMIBC setting, those pricing levels are so robust, that gives us a lot of freedom in both the NMIBC setting and in the LM setting, where you're not having to sort of draw two different price. Again, it's early to talk about pricing, but I think as a general rule, we're very confident that you'll have sort of this Rituxan or Ventus, rather, Avastin Lucentis model.
Yep. Yeah, exactly.
Been done before.
Right. Yep, looking forward to more news flow there. PRV program renewed.
Yeah
... you should be on your way to getting a juicy voucher.
Mm-hmm.
Which I think we just had a sale of $200 million or $205 million that was posted.
$205 million, yeah.
Yeah. Holding up, even though maybe the scarcity value may be coming down. Let's spend a few minutes on IV Choline Chloride. This is a totally different asset. And maybe, you know, yet another, sort of, you know, program that investors, you know, should be focusing on, that they have not as much. You know, this is sort of we know, I think it's pretty established that there's a very high prevalence of choline deficiency, in, and also liver dysfunction in patients who have to be on parenteral nutrition over long term. I think even the guidelines now recommend IV choline supplementation, even though there's nothing approved, which is.
Mm-hmm.
exactly what you're trying to solve for here. You know, how do you frame that unmet need? What are the clinical consequences of choline deficiency? How important is this, you know, in that, you know, kind of long-term chronic PN population?
Yeah. Look, let's just start with what we think the patients are that we could serve with this product, right? There is somewhere between 40,000 and let's call it high 20,000s. Let's split the difference. Let's say there's 35,000 patients in the United States that are on long-term chronic TPN, right? That means you're getting it for more than four days a week, and you are on for more than six months in a year. That's a big number, 35,000 patients in a rare disease setting. That's just the United States, right? We have intellectual property prosecuted around the world for this product, or for this molecule. As I think as it relates to kind of, where is the need?
What we know from our own observational study, the THRIVE-1 study, is that approximately 68%, I'm sorry, 80% of patients on parenteral support are choline deficient, and of those, 68% have some form of liver injury. There's a lot of different ways in which choline deficiency manifests itself. You know, choline is sort of the upstream precursor to phosphatidylcholine, which is a ubiquitous phospholipid in the body, and it's implicated in multiple different sort of organ functions and systems, but it's really sort of near term, and biggest application is in the liver and the transport of fats out of the liver. What we know from multiple studies conducted across vertebrates of every species imaginable, using choline-deficient diets, that within a matter of days or weeks, you start to see elevated LFTs.
We know that, you know, liver transplant, liver damage is a long-standing hallmark sequelae of parenteral support, and we believe that choline helps draw the, or helps maintain a healthy level of cells that are able to transport fats out of the liver. We're looking not only at a very simple PK-based endpoint of showing elevations in serum choline, but also downstream from that, you know, key secondaries looking at liver function, and if, you know, the history is any guide in all this literature showing that choline starvation drives liver damage, we're excited to see, you know, kind of where some of those clinical endpoints land.
I mean, I think it's pretty compelling when you have an endpoint that is geared to show an increase in serum choline when you give somebody choline parenterally.
Isn't that interesting, that when you put something in the blood and then you measure that thing in the blood, it goes up.
Just IP on that or exclusivity? Some people may say, "Well, choline is kind of like this...
Yeah
generic old molecule," yeah.
No, we have an Orange Book listed product claim patent that carries us out to 2041. That gives us a lot of, you know, a lot of leeway, and, you know, we're always looking at, as any good company should, once you get awarded a patent, you know, the first thing you gotta do is think about what's adjacent to that, and we've got a really great legal team working on this stuff for us. That 2041 product claim, A, it's Orange Book listable, and it is now being prosecuted or has been prosecuted in a number of other geographies.
Yeah, fantastic. I think we're almost at our time here, but, yeah, I just want to close by saying, like, you know, you look at Protara, and it's like, we don't cover CG Oncology, but that's like a $4.5 billion market cap company. My colleague Trevor covers Palvella, and they just had good data, and they're like heading toward a $2 billion market cap, and that's just two of the three of your programs at TARA. Yeah, I think people would be wise to spend some time looking at this one. Thank you very much, Jesse, and great to have the discussion. Thank you all for Zooming in, please enjoy the rest of the conference.
Always a pleasure. Thanks so much to the OpCo team.