Welcome, everyone, to Jefferies 2024 London Healthcare Conference. My name is Roger Song, one of the senior analysts covering SMID- cap biotech in the U.S. It's my pleasure to introduce our next company, Zenas BioPharma, and the CEO, Lonnie Moulder. And then Lonnie is going to give us a brief company overview, and then we're going to have a Q&A afterwards. Lonnie, please.
Thank you, Roger. We appreciate the invite from Jefferies. Thank you for attending, and for those of you that are viewing on the webcast, we appreciate your attention. I wanted to, for those of you that may not be as familiar with Zenas, provide a brief overview, and then we're going to have a nice chat about our programs at Zenas.
First of all, as a public company, I referred you to our SEC filings for all the information you're well aware of. We are a company that's focused on really making a difference in patients living with autoimmune disease, so we have an immunology focus. It's a global focus where we're actually prosecuting multiple global trials right now at the same time. I'll share some information about that.
A team that's deeply experienced in doing that, located in the Boston area in the U.S. but also in Asia and in Europe. And the team is really focused on our franchise molecule, obexelimab. And we'll talk about the multiple clinical trials. Importantly, the global phase III registration trial for IgG4-related disease completed enrollment last week. Quite proud of what the team's been able to accomplish to do that over 190 patients in less than two years.
The company, as you know, completed an initial public offering just a short time ago, and that provides us the capital to get through a number of the key data points all the way through into the fourth quarter of 2026. And you'll see how that covers a lot of the upcoming milestones for the company.
As a company, we build our portfolio via business development, and we intend to continue to operate that way, bringing additional molecules into the hands of this team that I think does an excellent job executing. This is the pipeline for obexelimab as it stands today.
The IgG4-RD study, we'll talk more about that, as I mentioned, completed enrollment. What does that mean? Now that we've completed enrollment, a year from now, we'll have the last patient out in November, and then go about doing what one does to clean database, query, lock database, transfer data, analyze such that we'll have the results, top-line results for the phase III program at about year-end next year.
In addition, there are two large global phase II trials ongoing, an RMS trial with obexelimab. A nd the RMS trial has a primary endpoint that will read out in the third quarter of 2025. So that's before the IgG4-RD phase III readout. In addition, we have a global trial in lupus, specifically SLE, that will finish enrollment next year and report out in 2026.
Near term, there's a study, a proof- of- mechanism study, in warm autoimmune hemolytic anemia or wAIHA, where we'll have a cohort of patients by year-end reporting out the key aspects of proof of concept, which would be hemoglobin, reduction of other biomarkers such as LDH and bilirubin.
I'm just going to spend a moment on the mechanism of obexelimab. It's really important to understand how this fits into all the potential ways to approach B cells for the treatment of autoimmune disease. And then I'll join Roger for the remainder of the conversation.
As you know, CD19 has been identified as a really ideal target in autoimmune disease. Why is that? Because it's broadly expressed across a broad amount of the lineage all the way through a subpopulation of plasma cells. Now, what obexelimab does is inhibit B cell lineage. It's not a depleter of B cells, and I'll describe that in further detail.
So as identified here, it's very potent inhibition, and there's clinical data and non-clinical data that support that. Not only B cell lineage present in blood but also in tissue. And that's important. The drug is administered as a self-administration subcutaneous regimen that provides continuous pressure on B cell lineage with exposure. We actually chose the dosing regimen to optimize C trough to keep receptor occupancy at the relevant level to continually put pressure not only in the blood compartment but importantly in autoimmune disease in tissue.
And as an inhibitor, there's almost a safety switch built in. If you pause this drug, B cell lineage is fully intact in a matter of weeks, which could allow for vaccinations, s omething we'll be investigating but, clearly, managing patients who may have clinical sequelae from a comorbidity or an infection.
So specifically, the way the molecule was engineered was to take advantage of CD19 as a targeting marker in B cell lineage. So the Fabs, the variable regions of the antibody, bind CD19. What drives the inhibitory signal of B cell lineage, though, is the binding of Fc gamma RIIB, also known as CD32B. This is the natural inhibitory pathway for B cell lineage. This is following an infection that one may have where antigen-antibody complexes eventually bind to shut the B cell immune response back down.
So what does that mean with our molecule? In co-engaging CD19 and Fc gamma RIIB, you actually decrease, of course, antibody production. Relevant in autoimmune disease would be autoantibodies. You stop the progression to further lineage. Of course, plasmablasts and plasma cells produce more antibodies. You don't want B cells to become plasma cells ultimately. Reduce cytokine production.
And importantly, there's a T cell component here because, as you probably know, B cells are important presenters of antigens to T cells, and you actually reduce antigen processing and presentation to T cells, so multifaceted mechanism that we're leveraging across a variety of autoimmune diseases. So I'll pause there and join Roger for the conversation.
Great. Great. Lonnie, it's a great overview. And then obviously, it's very differentiated. Mechanism in the B cell targeted therapy, we know we have a lot going on in the space, but very clear, obexelimab is very differentiated in terms of inhibitor versus depleter. And then CD19 is broadest coverage, along many other aspects.
Maybe we can, since we just are coming from the ACR, off of the ACR, topically, so what obexelimab presented there, I think some cardiac kind of safety study. So it's kind of a it's just a check the box type of the data, b ut more interesting thing is another, some kind of a direct read-through competitor in obexelimab. So they have some data for the phase III IgG4. How you see that data. A nd then how should we interpret the results from there?
If you don't mind, I'll go to a slide or two here. For the IgG4-RD program, in talking about the phase III program, our trial was called INDIGO, and looking at that in the context of MITIGATE, which was actually fully presented at the ACR meeting just prior, published, and earlier in the summer, top line results were released.
An important comment I'll first make is that study design validates our study design. It's virtually the same. Leading up to conducting our phase III study, we actually have phase II data in hand, which was not the case with that molecule. That molecule succeeded, but w hat I want to share here is thinking about how obexelimab compares potentially to a depleting approach.
This study shown was a phase II study conducted by the lead investigator John Stone at Mass General. John also conducted a rituximab study that had a very similar design. What you see here in this study, on the y-axis, is the IgG4 RI or responder index. It's a measure of flare activity.
The median to start this study was 12. The rituximab study was a little lower. It was 11. The median number of organs involved in these patients with IgG4-RD was four, and the rituximab study was less. It was, I think, three and a half, so r easonable comparison.
Maybe this population was a little tougher. What you see here is a very quick onset where remission in the induction phase with obexelimab is rather quick. In fact, it was half the time that rituximab took to actually achieve remission, a median of 21 days versus 43 days for rituximab in that study.
We know this is a very potent mechanism in a patient already in flare to induce remission. Now, the current standard is a pretty hefty steroid regimen. This and rituximab were the first agents to show the ability to induce remission, but as I said, quicker here with obexelimab.
And then overall in the study, across all parameters, the obexelimab study had better outcomes. Again, different studies. Importantly, at the end of the study, the number of patients that were still in remission was about 50% higher in the obexelimab study versus the rituximab study. So that's a potent inhibitor versus a known depleter, obviously. And rituximab did not move to phase III . There are no phase III data sets, b ut I think that's an important context.
Now, if you look at phase III, this is the INDIGO design, and you could just put the MITIGATE UPLIZNA design on top of it, all reviewed by the various regulatory bodies throughout the world, and this is the path we've both taken.
A nd the way the study works, patients are in flare, confirmed by an adjudication committee, treated with steroids to put them in remission. A nd only when they're confirmed in remission they're randomized one-to-one obexelimab, in our case, to placebo, and then monitored for flare. And the flare events, the annual flare events, are then analyzed in a time-to-event analysis reporting out as a hazard ratio as the primary endpoint.
S o the other molecule and obexelimab, the studies were basically sized on the same assumptions. Although the field believed that the placebo flare rate could be over 50%, both of us sized as if the flare rate would be 35%, to be conservative. A nd I think both companies assumed a 10% flare rate with their own drugs, but in the sizing, you always add a little bit, so we both assumed 15% flare rate with our own drug, even though in our phase II, as you saw, there was only one flare.
So the MITIGATE study played out, had a risk reduction of over 80%, so that's a hazard ratio 0.2 or under, so if we have a 60% flare rate in the placebo arm and a 10% flare rate in the obexelimab arm, that would also deliver an 80% or so reduction in risk and a hazard ratio of under 0.2.
Some of the differences, though, as a depleting antibody, although highly effective on the primary endpoint, the difference in the MITIGATE study of 60% flare rate and placebo in 10%; with the study drug a 50% effect size, so 50% difference.
On the complete remission secondary endpoint, it dropped to a 35% difference. We think one of the opportunities with obexelimab is because it's continuously dosed. First of all, we know we're getting inhibition in tissue, which is important, as opposed to an every- six-month attempt at full depletion.
With depleting antibodies, there's variability as to when patients reconstitute. So the patients could be at risk at not being fully depleted in tissue, or they reconstitute sooner into tissue. I think that's why there might be a difference in the complete remission rate from their primary endpoint. With our continuous weekly subq dosing, we think we have that covered from the C trough. So that could be one difference.
And another would be we use the important glucocorticoid toxicity index measure, GTI. So although both studies look at total steroid use, you want to spare steroids because of toxicity, and that's reported on MITIGATE. They did not actually apply the patient benefit analysis tool, which is the GTI. S o we'll have results from the GTI with our study. So I think those are important things to consider when looking at the two trials.
Excellent. And how about the safety? Because we do see some severe infection, opportunistic infection. How do you think? W e know this is the weekly dosing and then more frequent dosing, right? So chronically versus the six months dosing. How should we think about, over this treatment course, the safety profile going to look like compared to those two drugs?
Yeah, I think, to begin with, when it comes to administering the drug, both the drug in the MITIGATE study and rituximab have about a 20% hypersensitivity reaction. And that's even with pre-medication. So the patient has to go, get to an infusion center, which in major metropolitan areas, you probably can.
There are parts of different countries where that's much harder to do, b ut once you get scheduled for a chair, you have to go early, get your pre-medication, then your infusion. An d then you have to be monitored afterwards. And even with that, there was a 20% hypersensitivity reaction. It's not a surprise. IV antibodies do that, but not ideal.
And then the administration for our drug, as you know, is an at-home injection. Ultimately, it'll be an autoinjector. It's low viscosity. It'll be under 10 seconds. The patients will get their box of autoinjectors shipped to them every 30, 60, or 90 days, depending on whatever their pharmacy arrangement is, and be able to once a week do their 10-second autoinjection. No need for hypersensitivity pre-medication, which is much more convenient for many patients.
From an infection standpoint, we have to play out our phase III . We have the blinded safety database, and we're quite comfortable with what we're seeing. We know from the 200 patients or subjects that were included in prior trials of obexelimab that we appreciate the data there and that there were not opportunistic infections identified at that time.
Excellent. Okay. Now you have one drug getting towards the finish line. With positive phase III, t hey say they will file for approval in the coming months. And then obviously, we're waiting for your phase III result next year, s o how should we think about the IgG4-RD market with potentially two approved, new approved drug, maybe some off-label use by the rituximab and some others?
Based on some epidemiological research, we assume in the U.S. there are about 20,000 patients that are actually diagnosed. We believe in Europe it would be slightly higher. We know specifically in Japan how many there are because the ministry of health has conducted two national surveys. They have a great interest in this disease there.
In Japan, it's actually 20,000. There's no ethnic difference, so t hat would indicate in the U.S. or Europe that the number should be probably more like double that. I know, at ACR, one presentation, one of the key opinion leaders in the field thought the number was 4x higher than 20,000. We don't have data to identify that to be true at this point, b ut an ICD-10 code was put in place just over a year ago.
And it typically takes three+ years for that all to catch up so that you can really analyze that for prevalence, b ut think about most autoimmune diseases which were considered orphan or even very rare. And then once important therapeutics were approved and companies supported patient education, for instance, in IgG4-RD, there's a new scientific, medical, and patient advocacy organization that's been established. And that generally allows for better diagnosis and the population to be more understood when there's a drug to treat them.
So if there are 20,000, we think about half of that, whether that's U.S. or Europe, flare frequently enough that maintenance therapy would be important. If you don't provide maintenance therapy: P atients have flares, and every time there's flares, it leads to fibrosis in the organ, which leads to morbidity and consequences that are significant.
So if you look at that opportunity of 10,000 at the current pricing of the potential competitor, which is $250,000+ annually, right in the middle of orphan drug pricing, not really high, not low, that would give you a market growing in the U.S. approaching $3 billion over time.
A nd then with our profile of the convenient administration, perhaps some differentiation on secondary endpoints in safety, what type of share could we obtain? A nd with our commercial team in place, we feel very good about competing not only in the U.S. but in Europe where the market is about the same.
Got it. Yeah, we spent a fair amount of time talking about IgG4. That's your lead indication, but we know obexelimab is a pipeline in a product type of the franchise. So you are conducting two other phase II studies in MS and SLE. We'll have data readout next year and the following year. So maybe just using the last couple of minutes. So what should we expect from there? What's the rationale you pursue those two indications?
If you think about MS. O ver the last several years, anti-CD20 antibodies, depleting antibodies, have become the mainstay of therapy. It's the largest part of the market now goes to anti-CD20 antibodies. It's a little shocking to me. Six, seven years ago, I would have never anticipated it, but they're very effective at controlling relapse.
What has not been demonstrated, though, is addressing the underlying silent progression, the progression that's independent of relapse activity. And there's now a clinical endpoint called PIRA, progression independent of relapse activity. And no drug has used that as an important endpoint, so that is part of their label, b ut that's really the unmet need there.
So if targeting CD20 is effective, why would CD19 not be effective? If anything, CD19 is a bit broader. And we know, based on data versus a CD20 in IgG4-RD, that this is a potent inhibitor, quick onset, deep response in that disease, s o a highly effective inhibitor in MS bringing perhaps a differentiated safety profile, a more convenient approach to administration and, as I mentioned, a broader lineage coverage. And to think about taking the data that would come from our phase II and designing a phase III program where we could actually include PIRA as an endpoint.
And the reason we have optimism about this mechanism impacting PIRA is because actually retrospective analysis of CD20 antibody phase III trials shows some impact on PIRA. It just wasn't measured prospectively and it's not in the label. If we could replicate the type of data previously produced on primary endpoint but bring PIRA along as a key secondary and have that, I think we have something beyond the interesting profile that could really help patients with MS.
The first step, though, is to complete this phase II trial listed here a nd phase II trials in RMS, look at cumulative T1 gadolinium-enhancing lesion measurements via MRI. You look for about a 90% reduction. Every drug that has done that has typically worked well in a randomized phase III trial. We have to do this first, and we'll do this. We're actually accruing patients now. It'll finish enrollment and then lead to a primary analysis in the third quarter of 2025. This is actually a result before the IgG4-RD result, and then we'll plan from there. So we're really enthusiastic about the potential here, of course.
Yeah, and maybe just very quickly on the SLE.
Lupus is, for us, a really interesting program because we actually had data generated from our licensor who first engineered this molecule. Unfortunately, and this is listed here, was the study, the phase II- A that had been conducted. It was a bit undersized at 50 patients per arm to hit a P value.
I think most people in the field, since this study was completed, understand that a control arm in lupus SLE will probably deliver a 25%-30% benefit in the control arm. And with that, you need to size a trial almost twice as large as this to hit a P value, b ut what we learned from this trial is that in the intent-to-treat population, depicted on the graph, the effect size was 17%. That's similar to the effect size of the two approved lupus drugs. So the drug is active.
We had the benefit, before we in-licensed this, to conduct deep diligence and look at every single patient and also do something that led to our dose selection. All of our dosing is this weekly 250 mg subcutaneous self-administered regimen, and it was optimized to provide a C trough for receptor coverage.
What was found in this study was that, with the IV formulation that was originally used, that number of the patients' C trough fell off enough so that they didn't have target coverage. In fact, all the benefit in the study came from those patients who were in quartile three or four above the median. That analysis of that population showed an effect size double, so 35% benefit. That would be game changing in Lupus. That's the regimen we're using in our phase II study.
In addition, there was some interesting biomarker work that was done in that first study. And all of the patients in our current study are being interrogated for the biomarkers, s o if we, in fact, find something, we can bring that to phase III along with our improved dosing regimen, s o we're excited about this program that's now enrolling patients.
Excellent, I think, exactly on time. So thank you, Lonnie. A nd thank you for joining us.
Thank you, Roger. Appreciate it.
Thank you.