Nektar Therapeutics

Hello, and thank you for standing by. Welcome to the Nectar Therapeutics Second Quarter 2025 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Corinne Franklin from Nectar Therapeutics Investor Relations to kick things off. Please go ahead.

Thank you, and good afternoon, everyone. Thank you for joining us today. On the call today are Howard Robin, our President and Chief Executive Officer, Dr. Jonathan Zaleski, our Chief Research and Development Officer, and Sandra Gardner, our Chief Financial Officer. Dr. Brian Coxson, our Chief Medical Officer, will also be available during the question and answer session. On today's call, we expect to make forward-looking statements regarding our business, including statements regarding the therapeutic potential of and future development and regulatory plans for ResPeg-Galdas-Lucan and our other drug candidates, the timing and plans for future clinical data presentations, and other statements regarding the future of our business. Because forward-looking statements relate to the future, they are 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 May 9, 2025, and 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 developments, 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, Corinne. Good afternoon, everyone. The second quarter of 2025 was transformative for Nectar. In June, we reported highly compelling initial data in ectopic dermatitis for our lead clinical program, RESPEG-Aldis-Lucan, also known as RESPEG. These data establish RESPEG as a potential first-in-class novel T regulatory mechanism for patients suffering from this chronic relapsing inflammatory skin disorder. In 2023, we took the bold step to pursue T regulatory cell science across our pipeline. This science is focused on stimulating Tregs in different ways to restore the proper balance between T effector cells and T regulatory cells and achieve homeostasis in the immune system. And we had the goal at that time to demonstrate that this important pathway could represent a completely new way to treat autoimmune and inflammatory disorders by mimicking the way our own immune system works to resolve inflammation. So in October of 2023, We initiated a 400-patient Phase IIb study for RESPEG in patients with moderate to severe ectopic dermatitis, where early proof-of-concept data in patients had shown promise at the time. For our second indication, we chose to run a Phase IIb study in alopecia areata. This is a disease setting where the underlying T regulatory cell deficiency creates a known imbalance between T effector cells and T regulatory cells, leading to hair loss for these patients. The RESOLVE-AD study results we recently reported also validate Nectar's novel approach to access Tregs through the IL-2 pathway with a unique molecular design as compared to the competitive landscape. While other approaches to access IL-2 have focused on the design of mutines, which we believe hindered their development recently and over the years, we instead took a straightforward and elegant approach of accessing Treg biology through a native sequence IL-2 and then applying pegylation, a proven chemistry that has led to the approval of over 30 biologics and small molecules over the last several decades. And many of these are ones in which Nectar played a role. Now that we've been granted FDA fast track designation for both ectopic dermatitis and alopecia, we have the opportunity to move more quickly and align with the FDA to design the most expeditious regulatory pathways. This underscores that there undoubtedly still remains a large unmet need in the setting of ectopic dermatitis in alopecia areata for novel mechanisms of action. And we believe we're well positioned with a first-in-class novel Treg mechanism that is poised to enter phase three development in 2026. Now, since Dupixent was launched eight years ago, the ectopic dermatitis market has grown to around 15 billion dollars in u.s sales with expectations that it could reach nearly 30 billion dollars by 2033. our own recent market research has suggested that physicians would prescribe respec in both biologic naive and biologic experience patients with ectopic dermatitis and so our goal is to design a phase three program that captures this unique opportunity in front of us currently il-13 based therapies dominate the treatment landscape And about 50% of the patients failed to respond to this mechanism. Moreover, IL-13-based therapies are known to have side effect risks, such as conjunctivitis and infection, which can pose a challenge for patients. So in view of these challenges, there's a significant opportunity for RESPEC. With a fast onset of easy response and itch relief, RESPEC is poised to take a differentiated position in this landscape. As Jay Z will explain in more detail, Our Phase III strategy is designed to achieve a broad label in both naive and experienced patients, which would allow Respec to capture a substantial share of the growing multibillion-dollar ectopic dermatitis market. Given the very high correlation between historically positive Phase IIb results and the subsequent approvals in ectopic dermatitis, we're highly focused on moving quickly into Phase III, and our readiness activities are underway. Our oversubscribed $115 million equity financing in June now puts us in an even stronger financial position to complete important phase three enabling CMC and regulatory planning activities to ensure that RESPEC will be phase three ready in the first half of 2026. In addition, the financing also positions us to extend our cash runway into 2027. Looking ahead, The ongoing RESOLVE-AD study will generate additional data in Q1 of 2026, which we expect will further characterize the durability and depth of response for RESPEG out to Week 52. We plan to present patient-reported outcome data, including quality of life and symptom assessments from the 16-week induction period at a medical meeting this year. This data presentation will also include a planned data cut for patients who received placebo in the induction phase and who then crossed over to a treatment escape arm. With this new upcoming data cut, we're excited to see whether easy responses deepen with continued treatment with the RESPEG beyond the 16-week induction. I'll let Jay Z talk more about this key data set in a moment. Now, in addition, We're on track to report data from the separate phase 2B study in alopecia areata in December of this year. This is an indication where we are directly addressing the underlying pathology of hair loss in alopecia patients. Another positive outcome here would position RESPEG as a novel mechanism in a dermatological setting where there is only one mechanism approved for patients, JAK inhibitors. These carry multiple well-known black box warnings and are associated with high relapse rates, upon discontinuation. The market for alopecia areata treatments is projected to grow to $2 billion by 2033, and we believe that a new mechanism, RESPEG, could take a very significant share of this market. And now I'll hand it over to Jay Z for some more details on RESPEG and our earlier programs in our pipeline.