All right, everyone. I think we'll get started here with the next fireside discussion. My name's Derek Archila. I'm one of the senior biotech analysts here at Wells. Very excited to have X4 Pharmaceuticals. From the company, we have Adam Craig, Executive Chairman. Adam, good to see you.
Good to see you, Derek, and thank you for the invite.
Yeah, we were just talking, for me it seems like long ago because it's been a busy two days, but it was really just recently, you put out an update regarding your lead program. Maybe just to give a high level of the company and what you guys are working on, and then we can dig into that update.
Yeah. We're a Boston-based company that works in the area of rare hematologic disease. We're currently developing for a second indication, a drug called mavorixafor, which is a drug that increases the neutrophil counts in patients where they have conditions such as chronic neutropenia, where there are low neutrophil counts.
We have a phase III that's nearing the end of enrollment called the 4WARD trial. On Monday we announced a sample size readjustment with the FDA, and the sample is now going to be 126 patients, which we aim to complete that enrollment by the end of the year.
Excellent. I guess maybe talk us through the decision to do that in terms of you guys came in, new management team, and operationally, what was going on with the company to get to this decision point and provide this update.
Yeah. We came in as the new management team a year ago, so we're still learning. We learned a lot in the last year. Initially, we did get the impression the trial was overpowered. There were two endpoints. One is a reduction in infection, and the other endpoint is an increase in neutrophil count.
As the year progressed and we learned more about the trial, we decided to take another look at the powering. We got our statisticians to look at it, and we worked out that we could enroll a answer the question about whether the drug works in that setting, but we could answer the question with a smaller number of patients. The benefits of that, obviously you don't want to over-enroll a trial with patients and put them on a trial unless they need to. Also, there's significant financial savings.
We ended up with a number of 126, and we ran that by the FDA. We requested a Type C meeting, and we got written comments back from the FDA. They were happy with that. The study was adequately powered at that number. We canceled the meeting, and we announced it to the street on Tuesday morning, and we're moving forward with that number.
I'm pleased to say that having recently changed our CRO, who we had some problems with, we've now got Parexel in place. We've got very good enrollment at the moment, a good number of patients in screening, and we are confident that we will complete enrollment by the end of the year.
Excellent. I guess in terms of how you got to the number for 126, is there a level of conservatism built into that number and the powering assumptions here?
Yeah. All along, even before we joined the company a year ago, they've always been very conservative assumptions based on for the 4WARD trial. We've kept those assumptions, but what we've done is by reducing sample, reduce the powering in each of the endpoints.
So the infection endpoint has 88% powering and the ANC endpoint has 93%. That's a little lower. I think it was 96% plus previously. So that's a little lower, but still very well powered for a phase III trial. But the actual fundamental example, the fundamental assumptions of the trial have not changed, and they have always been conservative.
Excellent. I guess the other component of this on the flip side on safety, was there a discussion with the FDA or what do you need to show from a safety database to get this approved?
Yeah. That was the second question. Whenever you go to the agency, you should always ask, do you have enough patients for a safety database? We have over 500 patients who have received mavorixafor, healthy volunteers and patients, and the agency didn't indicate that we didn't have enough. They said it would be a review issue, which in agency speak is, "It's okay, but we need to take a look at it.
Can you discuss where you are in terms of enrollment, like where you are today, and I guess now you're anticipating completing that enrollment by the end of the year. So what's the delta and what gets you confident you can meet that timeline?
Yeah. We are in triple digit enrollment. I am not going to give a specific number, but you can see we are in a healthy position. I think the thing that we have noticed most recently with the change in the CRO is an increase in number of patients in screening. Obviously that indicates the patients go through screening before they are enrolled, and it is really healthy, the number of patients in screening at the moment, which is very encouraging.
I am pleased to say we have got patients we have enrolled, and we have got patients from the U.S. in screening as well. When we joined the company over just a year ago, there were no U.S. patients on the trial, which we were not happy with. We are now getting enrollment in the U.S., and we are getting new patients being screened in the U.S.
I guess how important was it to look at the data on a blinded basis to come to this decision? Also, you guys have shared some baseline characteristics.
Yeah
Has that changed at all?
No. The baseline characteristics are important. The FDA made a comment to the company before we joined a couple of years ago, "You have got to enroll patients in whom you can show a difference." For us, that is patients with low ANCs who have multiple infections. The protocol requires an ANC less than 1,000 and two infections in the prior year to come onto the trial.
We are actually seeing a median ANC of just in the low 400s, and 75% of our patients have three or more infections in the prior year. So we are enrolling a population that is quite sick, and that is what the FDA wanted us to do, so we can hopefully show a difference. When you have got those baseline characteristics, that gave me confidence that reducing the sample size would be okay. Because we are enrolling the right kind of patients.
It wasn't the primary driver of the decision, but it was some supportive data to say, "This is okay to do this.
Got you. It sounds like mainly the issues with the CRO is more of an operational, not like-
Yeah
whether the data integrity or actual-
No
population that was coming into trial.
No. I am not worried that we get asked by investors quite a lot the last few days, "Does this mean there are not enough patients out there to enroll?" Not at all. This was an operational issue.
This was a change we needed to make, particularly with the CRO, and we have already seen with that change an improvement in enrollment and improvement in patients in screening. Yeah, very much an operational issue, which I believe we are now seeing on the other side of.
Got you. Maybe to move on just in terms of the trial itself. What are you looking for in terms of effect size on these two endpoints? I guess, from your standpoint and the KOLs that you have talked to, what do you think is clinically meaningful in this population?
Yeah. In this population it is interesting because there has not been an agent like mavorixafor before. The main agent patients have is G-CSF, and when they receive G-CSF, the patients that come on our trial are the most refractory to it. They have been on it such a long time. We have modeled about a one-third improvement in infection rate.
That is generally how the trial is designed. I think if we demonstrated that improvement in infection rate of one third, I think that would be fantastic commercially. I know there is some feel it should be higher or lower, but I think data from a placebo-controlled randomized trial with a one-third reduction would be very well received.
Got you. What do you think the control arm should do in this trial? What is the expectation?
I haven't said publicly what it would do, but in any trial you always assume there'll be something in the control arm, but we've not stated publicly what that number is.
Okay. I guess one of the components here is that you're kind of enrolling a pretty broad kind of population, congenital, acquired autoimmune, idiopathic. How should we think about varying response rates based on the population that's being enrolled?
Yes. The congenital patients can be a little trickier to enroll. Sorry, to not enroll, to treat. The majority of our patients, or about 50%, is idiopathic anyway. We've not powered the trial to look at individual response rates in all the disease types.
The FDA is looking this as a whole, as a disease, chronic neutropenia. I would say probably the congenital, some of the congenital patients can be quite hard to treat. I think idiopathic is a population where it'd be easier for us to show a benefit, and I'm pleased that's the largest group that we're enrolling.
Got you. Have you broken down what the stratification is there?
We don't stratify like that.
Okay.
There's no stratification on this study. We do randomize between whether the patients have G-CSF or not, but there is no stratification, so there are no statistics looking at the individual disease types.
Got you. You bring up a good point. How are you looking at G-CSF use at baseline and ultimately controlling for that?
Yeah. G-CSF, we're assuming these patients are almost refractory. So within the statistical, and I've said this publicly, we're assuming a greater treatment effect in patients who are not on G-CSF, and a slightly smaller treatment effect on G-CSF.
The one third I quote you is the combination of the two. Some of these G-CSF patients have been on it a long time and just aren't responding to it. So it makes sense that we would expect a smaller treatment effect in that population.
Got you. Is there a cap on either of those in terms?
No.
Okay.
No, it hasn't really changed. The split is about 60/40.
Okay.
That number has not changed since we started a year ago.
Got you. Maybe can you tell us about a little history on the dose chosen to bring into this trial? What gets you confident in terms of the exposure needs?
Yeah
coverage for the patients? Yeah.
Yeah. I knew you were going to ask me that. I went back and had a look. The decision to pick the dose, 400 mg once a day, is based on a lot of data that goes back, a lot of pharmacokinetic data that goes back to healthy volunteers trials. We are very confident it is the right dose, it is the right schedule for the patients.
There is a lot of data and a lot of modeling that supports that. And clinically, we know from the phase II chronic neutropenia study where we saw increases in ANC, the drug is working. There is a pharmacodynamic effect with that dosing. I have no concerns about the dosing at all.
Got you. WHIM is a different indication, and you guys have proven effective there, but is there any read-through, at least maybe even just from the pharmacodynamics or anything, kind of key learnings that we should take from that experience to-
Well-
chronic neutropenia?
One of the reasons why I personally joined the company is I knew the drug worked in WHIM, and you could see it had a pharmacodynamic effect. There is no reason to think it would not be in the broader chronic neutropenia population.
What interests me most about WHIM patients are pretty sick. Not only do they have low ANC, they have low gamma globulins as well. We still showed a treatment effect in that setting. I am very encouraged in a population that is a little bit broader with chronic neutropenia, we can show a benefit as well.
One of the things that we have heard from docs that we have spoken with is that this is great. We will see this data. It will be effective. But it is more about can we reduce these patients' G-CSF use, maybe get them completely off it.
Yeah.
What will we learn from the phase III? I know that you guys will be starting another trial, specifically to look at this question, but are there any things that we can glean from the phase III trial?
Yeah. The phase II trial I think is brilliant. I think that the team before us wrote a really good protocol. It is really well-conceived. It is well-powered. I am very pleased with it. The one limitation of it is that at the request of the FDA, the G-CSF dose is flat. I think the reason behind that would be to remove too many variables in the analysis.
We still need to provide, have data out there with which we can guide physicians on how to manage mavorixafor and G-CSF together. We are in the process of putting together a, what we call a G-CSF titration study, where patients will start with, who are on G-CSF, will then have mavorixafor for a period of time, and then they will enter a period where we will try and deescalate the dose of G-CSF.
The idea is to complete that study and have it in manuscript form before we go into the field, so that the Medical Science Liaisons and the reps can have a data source guiding physicians on how actually to use G-CSF with mavorixafor, because you do not get all that from the 4WARD trial because the G-CSF dose is fixed.
For the patients that you would enroll into that trial, what would be the patient best suited to win and show that effect?
Well-
Like what level of G-CSF and-
We were talking about that this morning. There will be a patient who, the patient we will enroll, someone who is doing very well, but from an infection point of view, but is on G-CSF and find that is a burden. They are getting bone pain. They do not feel well. They have got a concern about risk of long-term malignancy.
The proposition for the patient is to move away from this injectable to an oral compound with, as fast as we can tell, with very tolerable toxicity. That is the proposition. We are enrolling patient. I suspect that trial will enroll quite well because there are a lot of patients who do not want to be on G-CSF.
In terms of how you would think about a protocol, is it a fixed titration, or is it more at physician discretion in removing the G-CSF
Within the protocol
Yeah.
Yeah, we haven't announced fully, but at the moment, the concept we're still discussing with the team would be there would be every 4 weeks an option to reduce the dose by a certain amount. Then over about a 20-week period, you could potentially go to zero.
Got you. This is I think an open label trial potentially.
This will be open label trial. I think we will, towards the end, depending on where we are as a team, we're a small team, but towards the end of the year, we'll hopefully be able to announce that we've started the trial, and then we'll include it on our corporate deck, and we'll talk about it.
We've been sort of telling investors about it early because, as you alluded to, the 4WARD trial has this one sort of gap, and that's it won't generate data on how to use G-CSF with mavorixafor, and that's the gap we're trying to fill.
Got you. Is there a deescalation rate that you can show before we even get to the final primary endpoint of that trial?
We plan to report currently the deescalation phase, and then we will report the long-term follow-up phase as well.
Okay.
Myself and John Volpone, our Chief Operating Officer, we're talking about, we need to report the deescalation because that's the first thing. We also need to report long-term safety as well. I imagine we will have a primary endpoint and then there'll be a long-term follow-up.
Got you. I am sure there is a spectrum, but it is like zero reduction to no G-CSF at all.
Potentially.
What would be the ideal reduction?
Well, we saw, as you know, Derek, we had a very small phase II data set we inherited, but there were patients who came off completely. Overall, I think it was about a 70% reduction in G-CSF, but I think there were three patients who came off completely. I do not think that is an unrealistic expectation. If mavorixafor can maintain the ANC at a decent rate, then we could get patients off completely. I think that should be our objective, but we will report the data when we have got it.
Excellent. Anything else on the trial that we should be focused on? Now it is more execution mode, finish the enrollment, and then get to the end of the trial. But any other things that we should be looking at based on the update and what is going on?
No, I think the question we have got is when will data come out?
Sure.
I think if we finish enrollment by the end of the year, the last patient will get to 52 weeks at the end of next year. Then we are looking at getting the data out, realistic time is between 8- 12 weeks to get top-line data. So, we are going to work hard towards that.
Got you. So maybe just shifting gears to the market opportunity within CN and how you guys view this. We were just talking about some of the benchmarks and the metrics that maybe docs want to see, but where do you see the low-hanging fruit in the market and then ultimately the overall pie here?
Yeah, I think we've quoted 15,000 patients, and we're pretty confident in that number. The more we learn about the market, the more we see where the drug can be used. It's obvious that there are patients who are getting recurrent and serious infections. That's the obvious area.
That's not just restricted to patients with ANCs less than 1,000. Mild patients can get recurrent infections as well. There are patients who take long-term antibiotics. They're not on G-CSF. They take long-term antibiotics.
There's patients on G-CSF. Some take it regularly, some take it intermittently, and then there's patients who don't want to be on anything. So we've got this broad range, and if we can develop the drug in that area I think we can go beyond just the 4WARD trial, but obviously we would only promote on label. And if we get a label in serious and recurrent infections, then that's where we'll focus on. But I think there is an opportunity for us to expand beyond that with a development program.
I guess, what do you say to docs who are like, "G-CSF is fine. There's really no need for something like mavorixafor." I guess, is that true or is that true for some patients? Like, where-
Well, we're-
Yeah.
G-CSF has been around a long time.
Yeah.
There are always going to be docs who are very happy with it. But what we're learning from patients is very different.
Yeah.
The patients do not want to. If you're a patient in your 30s, the median age on one of our trials is 30 years old. Do you really want to be on G-CSF for 40 years with the risk of long-term malignancy? And the answer is normally no. I was a practicing oncologist. I used to give G-CSF injections to my patients, and it's not nice for children, even young adults, to get injections.
It causes bone pain. They don't feel well. So I think the patient perspective will be very important here. But the physicians we've spoken to, the markets research we have conducted shows there is a market for an oral agent that can maintain ANCs. The injectable component of G-CSF is really quite problematic, and the market will change when there's a new opportunity.
Yeah.
A new drug.
It seems, given that a lot of these patients are on G-CSF or getting a test to see if you have low neutrophils is pretty easy. But I guess, would you say that these patients are fairly accessible and known to the healthcare system?
Yeah, they are. Our market research shows that the patients can get infections. They could go to the dermatologist, the emergency room, but they all come through their hematologist because eventually they'll need a bone marrow. If you've got low ANC, you're going to need a bone marrow examination.
So yes, we do think they're accessible. Most of the market will be the benign hematology market. Some of those patients will have gone back to primary care, but we'll know where they are.
So yeah, I think they're going to be very accessible. We know from our experience at CTI with VONJO, where these prescribers are, and we know that the majority of them will actually be in the community practices, not in academia. But we'll obviously work in both areas, and I think we will find them accessible, yes.
Yeah, I know we hit on this theme a little earlier, but the big question is just like, given that some of the challenges with enrollment over the years, and ultimately predating you
People are just like, "Is there a real market here?" So like maybe give us a little bit more confidence to like
Yeah
where these patients are.
I'm more than confident there is a real market here. I wouldn't have taken this opportunity unless I thought otherwise. We actually, years ago when we were at CTI BioPharma, looked at this opportunity as a management team, and we always thought there was a market there. The problem with enrollment was operational. It's nothing to do with it.
We think there are about 15,000 patients who have ANCs less than 1,000 and who have recurrent infections, who have a history of infections. The typical split in the marketplace, well, 80% of those will be in the community, and about 20% of those will be in the academia.
We will focus primarily on the hematologists because that's how the patients are identified and diagnosed, and I think it's very similar to what we did at CTI BioPharma. I think we can be quite successful here.
Got you. Then maybe just in terms of the burden to the healthcare system for these patients with these recurrent infections and how you start to think about pricing and the overall value here.
I think there's two components to it. We need to do some work on the cost of the healthcare system, hospitalization, surgical drainage of abscess and stuff. That's a substantial healthcare cost, and that's the kind of infections we're talking about, skin infections. So that's early days for us.
With respect to pricing, I think there is an opportunity here to have premium pricing against G-CSF if we improve against infections. The current pricing for the WHIM indication is in the $500,000 a year.
It's not going to be higher than that. I suspect we're going to be in around $200,000 to $300,000. But we need to do more research as a company. But based on prior experience, I suspect that's where we're going to end up.
Got you. Just competitive landscape here. I mean, is there really anything other than, obviously G-CSF is kind of the incumbent here, but anything else that's kind of on your radar that you're looking at or Yeah.
Not at this stage, no. There isn't. We have to be vigilant and make sure no one else, if there is someone behind us, but there's no one at this advanced stage that we're aware of.
Got you. So I guess when you think about the company, you came here, you've kind of righted the ship. We're in execution mode. What's kind of beyond mavorixafor and what do you kind of think about in terms of building this company into a heme specialized focused company?
Yeah, I'd very much like to do that. We've got some really good people who've got a lot of experience in the heme space, both benign and malignant, and I really would like to see the company develop with new assets, developing more as a broader hematology company so we can really make use of who we have and the people we have. That obviously has not been our priority today.
Our main priority has been the completion of the enrollment of 4WARD. In the future, if there was a good opportunity to expand the portfolio in our area of expertise, we would certainly look at it.
I guess, what do you take from your prior experience at CTI and working with the heme division and all that? How helpful is that for this whole process and the upcoming potential regulatory interactions?
I'm a big fan of the benign hematology division because I think they're really patient-focused. They tell you what they're thinking. I really am a big fan of the division. The communication we've just had with them is very straightforward, and fortunately, we know a lot of the people in the division still.
We've worked with them before, and I hope to continue a good relationship, a relationship where it's trustworthy on both sides. This is benign. Non-malignant hematology, I think, is a really good area to develop a drug in because the FDA is very, very patient-focused, as we are. So far it's been very good.
Got you. Is the idea to commercialize this yourself in the U.S. or partner ex-U.S.? What's kind of a future launch?
Certainly commercialize in U.S. Norgine, who is our partner in Europe for WHIM, will have the option of whether they want to opt in once the data is out for chronic neutropenia in Europe. Yes, we have already hired a former colleague as a head of marketing, and we are working hard on the marketing plan, and we plan to launch in the U.S.
What does the footprint look like? I guess, is this a concentrated population at just a-
I think-
handful of centers?
it's going to be very similar to what we did with CTI BioPharma. I think the split, as I said previously, is between 80% and 20%, between community and academia. We're talking probably around 50, 60 reps.
Five or six regional business managers. A very similar profile to before. A lot of these large community practices where we sell VONJO will also look after chronic neutropenia patients. I think it'll be the same number of, it's about, what, 2,000, 2,500 physicians. Very, very achievable for a smaller company.
And then maybe just last set of questions. In terms of the funding here, again, you push out the timelines a little bit. Just talk to us about your runway and what you're funded through.
Yeah. We're funded into 2029. Very comfortable, thanks to the work of David Kirske, my CFO. David has been very good at reducing the spend of the company. And some of the cost savings from the 4WARD trial will go into the G-CSF titration style. We have enough money to launch and we're putting in the launch activities, planning them for 2028. So we're in a good position.
The next update we should get is just enrollment completion. Is that a press release or how you disclose?
Yeah. We will announce it. I think the Street needs an announcement on that. That would be the appropriate thing to do. Hopefully, at some point, we will be able to announce the start of the G-CSF titration study as well. That would be good.
Would you anticipate kind of completing a little bit over the target number of 126?
My experience is you always go over a little bit.
Yeah.
Because at the end of a trial, I was in Europe last week talking to some physicians, and they have got patients they are going to consider to put on the trial at the end. You always get a little bit of an uptick at the end. I am very comfortable with that. The agency will not criticize us if we are 5%, 10% over. That will be absolutely fine.
Got it. Okay. Just last question. Next 12-18 months, seems pretty consequential. You will be reading out that trial, so just make sure we know all the key updates here and anything else that we should know in that timeframe.
Yeah. The main thing, as you say, is the completion of enrollment. I think the Street needs to hear that. Hopefully, that will be before the end of the year. Then the data itself will be in early 2028. It will last hopefully around 8-12 weeks after we enroll the last patient.
Then based on whether the FDA grants us priority review, you are talking about a launch maybe end of 2028, early 2029. It really depends on how long the agency takes, whether we get priority review. Certainly, the first quarter of 2029 is probably about as late as it will be. That is where we are heading for the next 18 months to 2 years.
Excellent. Well, Adam, I think we will leave it there. Thank you so much.
Thank you for your time.
Yeah. Great.
Appreciate it.
Thank you.