Great. We'll get started. Welcome once again to TD Cowen's 44th Annual Health Care Conference. I'm Phil Nadeau, one of the biotech analysts here at Cowen, and it's my pleasure to do a fireside chat with Vir. Very happy to have with us Marianne De Backer, the CEO, here today. Marianne, could you start with a brief state-of-the-company overview? What are the biggest strengths, biggest challenges, and what does Vir need to do to drive shareholder value over the next year?
Sure. Yeah. So thank you, Phil, and thank you, Cowen, for hosting Vir Biotechnology. It's a pleasure to be here. Yeah. So at Vir, we have a very bold vision, and that is powering the immune system to transform lives. And what does that mean, powering the immune system, right? So if you get infected by a pathogen, a virus, or there's cancer developing in your body, the outcome of whether that leads to disease or not is often determined by the versatility and the power of your immune system. And what we do at Vir—we are an immunology company—is coming up with tools that help patients and help the immune system really fight that disease and really tip the balance in favor of the patient. And we do that in two fundamental ways, and that is really reflective of the two platforms that we have.
One platform is, you know, getting to very unique, strong therapeutic antibody therapeutics that are more and more these days powered by AI engineering. And secondly, we generate very unique T-cell responses using our T-cell-based viral vector platform based on a human CMV vector. So using those tools, we are also looking to not just focus on infectious diseases anymore, as Vir has done for the past seven years, but also really open up our aperture to viral-associated diseases, which could be viral-associated cancers, and also other areas in which immune targeting could really be powerful. Now, if you ask us about how we drive value, you know, we have a very unique suite of technologies, as I just pointed out, but we also have late-stage clinical assets that have shown some really promising data in hepatitis B and in hepatitis delta.
Also we have, within the company, some really unique talent. We have really some of the world-renowned immunologists, data scientists, virologists. We have deep expertise, and that has proven itself already a couple of times. You know, many might know Vir Biotechnology from during the pandemic days where, you know, Vir went and discovered sotrovimab, a COVID antibody, and really went from, you know, an idea on paper to bringing it to patients together with partner GSK in a period of 15 months. We are, as a company, also very strong in execution and operational excellence. You also talked about or you asked about challenges. I would say that, you know, our challenges are not different from any other biotech company. Obviously, you know, it's still a volatile biotech market. We have the uncertainty that is always associated with clinical development.
We have to be very judicious in how we deploy our capital. You know, these are all things that I think are not very unique to us. You know, what is really great for us as a company is that 2024 is a year where we have a lot of important catalysts coming up. The catalysts in our clinical programs, hepatitis delta, hepatitis B, and also HIV, are really what is going to be driving shareholder value in the near term.
Before we dive into the programs specifically, a couple more corporate questions. You have a very strong balance sheet. Would you consider licensing or acquiring companies' assets to fill the pipeline, particularly in the viral-associated disease areas that you mentioned?
Yes. So we ended 2023 with $1.63 billion in cash and investments. So we have a very healthy balance sheet. And what that allows us to do is really make sure that if the data on our late-stage programs continues to be positive, it's to really fund through the next value inflection point. And that's really our core focus. But to your question, beyond that, we have the opportunity to invest in external opportunities. And what we are looking for is really opportunities that can augment our pipeline. And so more specifically, you know, early clinical stage assets or assets that are close to entering the clinic is sort of the sweet spot of what we are looking for. And we are being very strategic and thoughtful as to what, you know, those external innovation opportunities need to look like.
Turning to HDV, an area where we get a lot of questions from investors. For those less familiar, could you provide an overview of the goals of HDV treatment? What's the unmet need there, and how could Vir's pipeline help?
Sure. So first of all, what we are aiming to achieve in hepatitis delta is a lifelong treatment that is providing, you know, adequate safety, efficacy, and convenience for patients. The need in hepatitis delta is very high. You know, the estimates are, you know, somewhere between 12 million and 70 million patients, which is a very big range. And it sort of reflects the underdiagnosis that is apparent in that disease at this moment in time. We expect about 100,000 patients in the United States and probably around 200,000 patients in the EU5. And hepatitis delta is the most severe form of hepatitis. Delta, the delta virus, is a tiny RNA virus that basically co-ops the hepatitis B virus for its life cycle. And when a patient gets infected by both viruses, then the progression to disease is much faster.
So patients progress four times faster to potential liver cancer, two times faster to, you know, mortality. And more than 50% of the patients that are infected with delta within 10 years die within 10 years from, again, liver cancer, liver cirrhosis, and decompensation. So it's a high unmet medical need. There is, as you think about, you know, treatment, nothing available in the United States at this time. In Europe, there is one treatment available, which is a daily injection that patients need to give themselves for the rest of their lives and with not very impressive efficacy.
So what we have shown with our therapeutic regimen, which is either a regimen of using our antibody called tobevibart every two weeks or a combination regimen of tobevibart combined with an siRNA, elebsiran, every month, is that, and again, we showed that data at EASL last year that in only six patients but from those six patients, all of them, so 100%, showed their delta RNA drop below the lower limit of quantification, and that only after 12 weeks of treatment. 83%, so five out of six, saw the delta RNA drop below the limit of detection, really getting to undetectable. So that was very impressive data, of course, early, only in six patients.
But that has given us a lot of hope because, again, what you're trying to achieve typically in a chronic viral disease is really getting to that undetectable, as, you know, we have seen in HIV and as we have seen in hepatitis B. So we are currently conducting a trial, which is called SOLSTICE. And we will have additional data coming out in the second quarter of this year, 15 participants for each regimen at 12 weeks of treatment and 10 patients for each regimen at 24 weeks of treatment. So, you know, with those additional 50 patients, we will get a really good insight into whether the promising data that we saw with the initial six patients continues.
If that is the case, then in the third quarter, we will have an opportunity to connect with regulators in the U.S. and in Europe and, you know, align on a path to registration.
Where will that SOLSTICE update come? Is that likely to be at EASL, or is it possible you'll do a corporate symposium, or is there another venue?
It's likely going to be EASL. Yeah.
OK. What data does that have to produce in order for you to have that conversation with Q3 in Q3 with the regulators and potentially move into a pivotal study? Is there a certain bar for a proportion of patients that are suppressed, a certain bar for how many get to the lower limit of detection or quantification or ALT normalization that you need to see?
Yes. So our full data set from SOLSTICE we will have in the fourth quarter, which will be 60 participants at 24-week treatment. However, we do believe that if in the second quarter, you know, with, again, the patients that we will have at 12 and 24 weeks, if the data is similar to what we have seen in the six patients at AASLD, again, you know, a significant level of patients getting to undetectable or below lower limit of quantification and a reasonable number of patients that are normalizing ALT, then I think, you know, it really makes sense to not wait another six months but to engage in conversations with the regulators and see what the path could be to registration. Because, again, the unmet need is very, very high. There is no treatment available here in the United States.
So, you know, if we show convincing data, I think it really makes sense to not wait for our full data set at the end of the year.
What could a pivotal trial look like? You mentioned Hepcludex from Gilead hasn't made it to the U.S. market, but I believe that was manufacturing-related rather than clinical data. So would a pivotal trial be a decent proxy for what we would expect from Vir?
It could be. But again, you know, depending on our data, we really want to have the conversation with the regulators on, obviously, the trial design, the primary endpoint, the size of the trial based on the kind of safety database that we need to put together. So, you know, we will be in a potentially really good position by the third quarter to be able to answer that question.
You mentioned the prevalence of 100,000 patients in the U.S., 200,000 in Europe. Given that there are no treatments today, are those patients under the care of hepatologists? Are they diagnosed, or are they just considered HBV patients, and there would probably maybe be another round of testing that's necessary to figure out if they have HDV?
Yeah. So unfortunately, hepatitis delta is relatively uncharted territory. And it's typically the case if you don't have a good treatment, there's no impetus, there's no motivation to diagnose. And so we have some papers that, you know, and data that show that there's a number, you know, there's thousands of patients that seek care, but there's just nothing that, you know, the hepatologists can do at this moment in time. So our expectation is that, you know, as there is hopefully an opportunity with our regimen to come up with transformational data, that that will act as a flywheel for more diagnosis. And we've had a lot of conversation at AASLD, and actually recently, last week, we bring together top KOL hepatologists in the world to talk about this, you know, how can we increase diagnosis, what will it take.
We're doing a lot of preparative work to be able to make a difference there.
Transitioning to HBV, can you remind us of the status of the development program in HBV, and more broadly, where would you envision the combination regimen fitting into the treatment paradigm?
Sure. Yes. So just maybe to remind everyone, I mean, if you look at it globally, there's about 300 million people that are living with chronic hepatitis B. There's probably about two million people in the United States, estimated three million in the EU5, again, a very significant opportunity. What we are trying to achieve in hepatitis B is to get to a functional cure. So it's different from hepatitis delta, where we are looking for a lifelong chronic therapy. In hepatitis B, we're really targeting to get to a functional cure, meaning that you treat for a finite amount of time. You then take patients out of therapy, and you get continued control of the virus.
So what we have shown initially is that if we combine our siRNA with interferon, pegylated interferon alpha, is that after 24 weeks, we had only, you know, about 5% HBsAg loss. After 48 weeks, that increased to about 25% HBsAg loss. And then six months, you know, post-end of treatment, we ended up with a functional cure rate of about 16%. So that's the data that we showed last year. We then looked at if we add our antibody, tobevibart, to either the siRNA alone or to the siRNA plus interferon, what happens. And so at week 24 last year, we showed that you tripled, actually, the HBsAg loss. So we got to about 15% in each of these regimens, the doublet or the triplet.
So the kind of data that we're looking forward to now this year, at the end of this year, is 48-week end-of-treatment data for the doublet, again, for a siRNA plus our antibody, tobevibart, and the same plus interferon alpha. So that end-of-treatment data, we will know in the fourth quarter. And then, of course, six months later, in 2025, we will have functional cure data. I think what has been very encouraging is that, you know, typically if you treat patients, hepatitis B patients, only with interferon, pegylated interferon alpha, you get to a cure rate of about 3%-7%. So the first thing we showed is that if you add elebsiran, the siRNA, to pegylated interferon, is that you can increase that functional cure rate to 16%.
And then, again, what we have shown at 24 weeks is that if we add our antibody, tobevibart, to that regimen, is that you can triple the S-antigen loss. So there's clearly an additive nature of each of the components that we have. And that is to be expected because, again, our hypothesis is that, you know, we want to stop the infection and clear the virus and activate the immune system. And that seems to be what is going on here. So it will be important now for us to, you know, to see the 48-week end-of-treatment data at the end of the year.
Is there a rate of HBsAg loss at the end of 48 weeks that would give you confidence that you're likely to see a clinically meaningful improvement in functional cure rate?
Yes. So as you remember, as Vir, we had initially set ourselves a target of a 30% functional cure rate. Again, we've had a lot of conversations with top KOLs from the world in hepatology. And what they are saying is that, again, the unmet need is high. There's, you know, not really a functional cure out there. I mean, and again, interferon alone only gives you 3%-7%. So what they are telling us is that an interferon-containing regimen would probably have a functional cure rate, need to have a functional cure rate of about 25% for them to really consider treating patients. And you could get away with a little less if it was an interferon-free regimen. Now, the question is your question is, so what does that mean for what you need to see at end of treatment, right?
Right. And is the right answer? You have to wait till six months later. But is there any number at the end of treatment that would give you confidence you're on track for that 25%?
Yeah. I think that if you would only end up with 20%, 25%, you know, obviously, it's not getting higher. So I think that would, you know, probably not look very attractive. What we have seen, actually, is that so with interferon, there is no difference in functional cure rate at end of treatment versus six months off treatment. However, what we have seen, as you remember, is when we had the combination of elebsiran and interferon, is that we went from about 25% to 16%. So there was a drop-off in HBsAg loss. So if you assume that there's going to be a drop-off in HBsAg loss, so obviously, you know, end of treatment, 48 weeks, would have to be, you know, somewhat higher than the targeted 25% functional cure rate.
Got it. That makes sense. What would be the next steps for the program? Let's say that the functional cure rate that we see in mid-2025 seems intriguing. What would be the next trial?
Yeah. So obviously, if that is the case, we would be, again, you know, in interactions with the regulators to align on what a registrational trial would need to look like to get to a regimen that we could bring to market for B.
Perfect. And then now moving to HIV, which you mentioned in your opening remarks. For those less familiar, maybe discuss the CMV vaccination approach and the technology platform that underlie the HIV candidate.
Sure. Yes. So as I mentioned in the beginning, we have a really powerful antibody platform, you know, where we use protein engineering through AI. The other platform that we have is we call it T-cell-based viral vector platform. And it uses the human CMV vector basically as a Trojan horse to bring other genes of viruses into a human being that can then elicit very powerful T-cell responses. And in that program, which is called VIR-1388, it is focused on generating an HIV prophylaxis treatment. And what we're really trying to see, and we will have that data in the second half of this year, if we really can elicit immunogenicity that is HIV-specific because that's the insert that we put into the HCMV vector. So that's it's not just the fact that we elicit an immune response.
We also want to see, you know, is there an effector memory T-cell response? Is there a CD8 T-cell response? So the nature of the immune response is also really important. And, you know, that initial data in the second half of this year will really be a proof of concept, not just for the program but also for the platform.
How many patients across how many doses do you think we'll see in the second half of this year?
Yeah. So in total, in the program, we are enrolling 95 participants. And it's, you know, it's divided in a Part A, where we are enrolling CMV-positive patients that are of non-childbearing potential. And then there will be a Part B, where we will have CMV-positive patients that can have childbearing potential. And the Part A is really also with increased safety monitoring because we want to make sure, of course, that our regimen is safe.
This compound VIR-1388 follows our predecessor molecule, VIR-1111. How does it differ? What's the difference in structure?
Yes. So VIR-1111 was a very significantly attenuated CMV vector. It was sort of a first pilot to see whether you could use this kind of vector and to see whether this was going to be safe to be used in humans. The next generation vector has been modified for increased ability to be immunogenic. And yeah, it has really been optimized for a potential response against HIV.
Turning to flu, perhaps one of the bigger events of 2023, you've announced 2482 didn't succeed in its phase II trial. I believe there's still some work going on to analyze that data. What is the status of the 2482 program? And how would you move forward in flu if you choose to do so?
Sure. Yes. So for VIR-2482, what we have been doing is really carefully analyzing the data and learn as much as we possibly can that we, you know, can really use and deploy those learnings to any next endeavors we might take in flu prophylaxis. So what we have learned for VIR-2482, the PENINSULA trial, is a couple of things. So if you remember that we missed our primary endpoint and ended up with only about 50% efficacy. However, if we included fever in the endpoint, we could increase that efficacy to 57%. And also, if we excluded the cases where the infection by the virus and the administration of the treatment was very close to one another within seven days, then that went up to, you know, to 60%+ percent.
So there's, you know, there was clearly a situation there where the flu season peaked very, very early. It was very exceptional that the flu season peaked already in October, November. And we started dosing in October. So there were quite a number of cases where people got in, were treated and got very quickly infected by the virus. And there wasn't enough time really for the antibody to get where it needed to be to exert its effect. So there's a lot of learnings there. We have a next generation flu antibody program that is not just covering flu A as VIR-2482 did, but it's covering both flu A and flu B. It's also much more potent in vivo. And it's working on neuraminidase, which is a very well-known and effective mechanism of action. So we are looking at progressing that next generation program.
But again, I want to emphasize that, you know, running prophylactic trials in influenza is incredibly capital-intensive. It is not something that we as Vir want to do on our own. So, you know, once we have the next set of in vivo data, we will be looking for a partner to take that through development.
I think Vir came to prominence in most investors' eyes through COVID, which you alluded to in your earlier remarks. What is the most recent status of Vir's programs on next generation COVID antibodies and prophylaxis treatments?
Sure. Yes. So we do have a next generation COVID antibody. However, it is not a program in which we want to deploy Vir's capital. It's a program that is funded by BARDA. And we have achieved, actually, $50 million in funding last year in October to take that program through phase I. And, you know, it's a very powerful antibody. It's active against, you know, the most prevalent variant that is here now in the United States, JN.1. So, you know, it's very variant resistant. It's very powerful. However, you know, the commercial outlook of COVID is very uncertain. So it's not something that, you know, we want to deploy our own capital to at this moment in time.
Well, that sounds rational.
Yeah.
Vir has enunciated a goal to advance multiple INDs over the next 12-24 months. Can you broadly say what areas those INDs will be in? And in particular, are there any that you're enthusiastic about that you'd like to highlight?
Sure. Yes. So we already talked about our flu A, B antibody. I think that's a really, really exciting program. Again, it's covering flu A, flu B. It's more powerful. And it's a de-risked mechanism of action. So that is one program that we are looking forward to progressing to IND. The other one is a program that we're working on with GSK in RSV. We have a combined RSV MPV antibody. And we also have single RSV antibodies that are really very powerful. So that's, you know, an exciting program that we work on with a partner. And we have, you know, programs that are a little bit further ahead, a little bit further behind. But they are focused on HPV. So it's a viral-associated cancer using our viral vector platform. And we have an HIV cure program using a cocktail of very unique monoclonal antibodies.
For the viral-associated diseases like viral-associated cancers, are those programs likely to come from external innovation? Or are there very early-stage programs in each of those as well?
Yes. So it's a bit of a mix, I think. So the HPV program that is using the CMV vector is sort of the first program that is really internal. And that fits that category perfectly. But as we mentioned, we're also looking at external innovation and especially, you know, assets that, as I said, are early clinical or close to the clinic. And, you know, those will fall in the categories of either viral-associated disease, viral-associated cancers, or, again, other immune-targeted diseases.
Perfect. With that, I think we're just about out of time. So thank you for an interesting discussion.
Thank you so much, Phil. Appreciate it. Thank you.