Nektar Therapeutics

Good day, and thank you for standing by. Welcome to the Nectar Therapeutics third quarter 2024 financial results conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Vivian Wu. Please go ahead.

Thank you, Crystal, and good afternoon, everyone. Thank you for joining us today. With us on the call are Howard Robin, our President and Chief Executive Officer, Dr. Jonathan Zalewski, our Chief Research and Development Officer, Dr. Mary Tagliaferri, our Chief Medical Officer, and Sandra Gardner, our Chief Financial Officer. On today's call, we expect to make forward-looking statements regarding your business, including statements regarding the therapeutic potential and future development plans for drug candidates and research programs, the timing of the initiation of clinical studies and availability of clinical data for drug candidates, the timing and plans for future clinical data presentations, the formation, future development plans, or success of our collaboration agreements, financial guidance, and other certain statements regarding the future of our business. Because forward-looking statements relate to the future, they're subject to uncertainties and risks that are difficult to predict, many of which are outside of our control. Our actual results may differ materially from these statements. Important risks and uncertainties are set forth in our Form 10-Q that was filed on August 9, 2024, which is available at sec.gov. We undertake no obligation to update any of these forward-looking statements, whether as a result of new information, future development, or otherwise. A webcast of this call will be available on the IR page of Nectar's website at Nectar.com. With that said, I would like to hand the call over to our President and CEO, Howard Robin. Howard?

Thank you, Vivian. Thank you all for joining us today. During the third quarter, we made significant progress in advancing our highly promising pipeline focused on immunology and inflammation. Importantly, we are laser focused on advancing our phase two studies for our lead aspect a lead asset, ResPeg-Aldis Lupin, also known as ResPeg, which is designed to directly expand functional Treg cells and engage multiple immunoregulatory pathways in patients with autoimmune disorders. As you know, ResPeg has generated promising early data which support its potential to become a highly differentiated and new mechanism in the treatment of atopic dermatitis and alopecia. There are approximately 15 million people living with moderate to severe ectopic dermatitis in the USA today. It is estimated that under 10% of those patients who could receive biologics today are actually receiving treatment. We believe that new mechanisms are the key to growing this underserved biologic market. This is why we're so excited by ResPeg's potential as a first-in-class T-regulatory cell mechanism for these patients with critical unmet needs. Enrollment in our Phase II study in ectopic dermatitis is on track for a top-line data readout in the first half of 2025. We're very pleased with the enrollment pace for this large 400-patient Phase IIb study, and Jay-Z will share more on the ongoing study in a moment. We believe there's also significant potential for RESPEC to help people with alopecia areata. Nearly 7 million people in the United States alone have or will develop the disease. The disorder significantly affects the quality of life for patients, and the currently available JAK inhibitor therapies are not durable, have high relapse rates, and carry significant safety risks. Therefore, there's an urgent unmet medical need for new therapies for these patients as well. Enrollment in our second Phase IIb study of RESPEG in 86 patients with severe to very severe alopecia areata also remains on track for top-line data in the second half of 2025. Two weeks ago, we published in Nature Communications the data from the Phase 1b study of RESPEG in ectopic dermatitis and psoriasis. These data, taken in aggregate, bolster our decision to proceed with the clinical plan and advance our two Phase 2b studies in ectopic dermatitis and alopecia areata. And Jay Z will talk more about the important data from these publications later on in the call. Turning to our preclinical programs, we continue to advance NECTAR-165, our novel TNFR2 agonist antibody program. Given the importance of TNF receptor 2, NECTAR-165 could potentially become a first-in-class treatment for autoimmune diseases such as multiple sclerosis, ulcerative colitis, and vitiligo. Earlier this year at ULAR, we presented the first preclinical data for this program showing that NECTAR-165 demonstrated selective enhancement of Treg cell function, and Jay-Z will discuss more about that later. We're currently conducting IND-enabling studies with the goal of preparing for an IND submission in the second half of 2025. Now, leveraging our learnings from NECTAR-165, we've also designed a pipeline of TNFR2-containing bispecific molecules that pair TNFR2 agonism with other antibody targets. And we look forward to providing more color on this pipeline as development candidates emerge. In addition to Nectar 165, we also have our PEGS CFS-1 program, Nectar 422. In preclinical stage, that was engineered to selectively modulate resolution processes of inflammation. We're excited to announce that preclinical data spanning multiple animal models, including collagen-induced arthritis, were selected for an oral presentation at the upcoming 2024 ACR Convergence Meeting in Washington, D.C. This will be our first presentation of preclinical data from this program, and Nectar 422 has the potential applications in a number of therapeutic indications, including acute and chronic inflammation. Next, I'd like to discuss Nectar 255, our IL-15 program in oncology. We've recently announced multiple sets of data from this program published in Blood and at ASH. These data show that Nectar-255 can enhance the activity of CAR-T therapies. Today, we presented a late-breaking abstract at CITSE, demonstrating the use of Nectar-255 in a new application. In that abstract, Nectar-255 showed the ability to recover radiation-induced lymphopenia in patients with non-small cell lung cancer. And Mary will talk more about that program on the call today. Now, before I hand the call to Jay Z, I want to briefly discuss our transaction, our transaction announced this week. Earlier this week, we announced that we signed an agreement to sell our commercial peglation reagent manufacturing facility in Huntsville to ampersand capital partners. The peg reagent facility will be spun out as a standalone ampersand portfolio company. Nectar will receive $90 million in total compensation, which is comprised of $70 million in cash and $20 million in equity ownership in the new portfolio company. And we expect the deal to close on December 2nd. In addition to serving the plant's existing customers, the new company will continue to serve Nectar's PEG supply needs for ResPEG and our other PEG-related programs in our pipeline. We will retain all rights to royalties and milestones under existing PEG license agreements, including those related to DAPI PEG-ALL, which has already demonstrated positive Phase III efficacy in lupus. This strategic divestiture of the plant allows us to streamline our operations and further bolsters Nectar's financial position as we head into top-line data readouts in 2025. The proceeds will extend our cash runway into the fourth quarter of 2026. And with that, I'll hand the call over to Jay-Z for an R&D discussion. Jay-Z?