Reata Pharmaceuticals, Inc.

Thank you for standing by and welcome to the Reata Pharmaceuticals first quarter 2022 financial results and update on development programs conference call. An audio recording of today's webcast will be available shortly after the call in the investor section of Reata's website at reatapharma.com. Before the company proceeds with its remarks, please note the forward-looking statements disclosure in the company's press release. There are many factors that could cause results to differ from expectations, including those noted in the company's SEC filings. On today's conference call non-GAAP financial measures will be used to help investors understand the business performance. These non-GAAP financial measures are reconciled with comparable GAAP financial measures in RIATA's earnings release and presentation from today, which again can be found on RIATA's website. Today's statements are not guaranteed of future outcomes. Please also note that any comments made on today's call apply only as of today, May 10th, 2022, and may no longer be accurate at the time of any webcast replay or transcript reading. Following the prepared remarks, we will open the call up for questions. We ask that you please limit yourself to one question and one follow-up so that we can accommodate as many questions as possible. We are joined today by Warren Huff, RIATA's Chief Executive Officer, Manmeet Sunny, President, Colin Meyer, Chief Innovation Officer, Simi Khan, Chief Medical Officer, and Dawn Burr, Chief Commercial Officer. At this time, I would like to turn the call over to Warren Huff.

Good morning, everyone. We thank you for joining us today for our quarterly update. I'll start on slide four. As you all know, we're developing omaviloxelone, or omav, a small molecule activator of Nrf2 for the treatment of patients with Friedreich's ataxia, or FA. We've made significant progress with the program over the last few months. Following the positive results from the MOXIE Part 2 study, we had multiple interactions with the FDA to determine whether there was a path to submission and review of our new drug application for NDA. This was highlighted by completion of a pre-NDA meeting with the division in the third quarter of 2021. Following the meeting, we applied for and were granted fast-track designation for the program, highlighting the potential of OMAV to address the serious unmet need for treatment options for patients with this devastating disease. Fast-track designation provided us with eligibility for rolling submission of our NDA, which we initiated and completed in the first quarter of this year. Additionally, the FDA recently granted rare pediatric disease designation to OMAF. Our NDA includes a request for priority review based on the severity of the disease and the lack of approved treatments for patients with FA. If granted, this could result in a Prescription Drug User Fee Act action date or PDUFA date in the fourth quarter of this year. We're working with the FDA while it reviews our NDA this year, and if the FDA approves OMAP for the treatment of patients with FA, we plan to be in position to launch our first drug early next year. Finally, we're continuing to complete the regulatory procedures and submissions that are required as a condition to filing a marketing authorization application in Europe. We've secured agreement on our pediatric investigation plan with the Pediatric Committee, and we plan to submit an MAA to the European Medicines Agency for OMAP in the fourth quarter of 2022. Next slide. Regarding our programs in rare forms of CKD, our priority has been to first work with the Division to ensure we are aligned on the trial design for our ongoing Phase III Falcon trial so that we have a clear regulatory path forward for that important program. Based on the issues that the FDA raised during review of our NDA and Alport syndrome, we submitted a proposed amendment to our protocol for Falcon. We recently completed a Type A meeting to discuss the protocol amendment and to ensure that we're aligned on the trial design with the division. During the meeting, the Division stated that the proposed primary endpoint of EGFR change from baseline at week 108, which is eight weeks after planned drug discontinuation at week 100, was reasonable because our available data suggests that BARD's acute pharmacodynamic effect on EGFR should be largely resolved. The Division also stated that in addition to the primary endpoint, it will be important to demonstrate that the treatment effect accrues over time to support a claim that BARD slows the loss of kidney function in patients with ADPKD, and it provided guidance on exploratory EGFR slope analysis that would address the question. Importantly, the agency emphasized that the analysis will be important, but also stated that the results do not need to be statistically significant. They also confirmed that if the FALCON trial is positive, it could support registration of BARD and ADPKD. Simi Khan will provide additional information about our program and ADPKD later after the call. With completion of the Type A meeting and alignment on our protocol amendment for FALCON, we'll continue to work with the FDA to confirm our next steps on our Alport Syndrome program. Finally, I'd like to remind you that our strategic collaborator in Japan, Kaiwa Kirin, is sponsoring the IAME trial, a large phase three clinical trial in patients with diabetic kidney disease. The IAME trial enrolled over 1,000 patients with stage three and four diabetic CKD, and the primary endpoint is time to onset of greater than or equal to 30% decline in EGFR or end-stage kidney disease. If the results of this trial are positive, it could provide clinical evidence that improvements in EGFR observed in BARD-treated patients do, in fact, delay progression to kidney failure. Kiowa Kieran expects to complete the last study visit in the second half of this year. With that, I'd now like to turn the call over to Colin Meyer, who will provide an update on our program with OMAD in patients with FA. then Tasimi Khan, who'll provide further updates on our program with BARD and patients with ADPKD, and our program with RTA-901. Dawn Burr will then discuss our progress in our commercial preparation activities for OMAV. Lastly, Mahmid Soni will review our financial results for the quarter.

Thank you, Warren. Starting with slide seven, FA is a relentlessly progressive and debilitating neuromuscular disorder. It is caused by epigenetic silencing of frataxin, which impairs mitochondrial function and is associated with suppression of Nrf2. These effects lead to impaired energy production and neurodegeneration. As the disease progresses, patients with FA become dependent on walkers and in wheelchairs, and they ultimately lose their independence altogether. The median survival for these patients is in the mid-30s. Despite numerous attempts at developing therapies for FA, Prior to MOXIE, none has been successful, and there are no approved treatments. FA is an inherited recessive form of ataxia, which affects approximately 5,000 children and adults in the US, with approximately 4,000 patients currently diagnosed. Next slide. Clinical trials in FA are challenging to conduct due to two major factors. First, there are a limited number of FA patients who are willing and able to participate in clinical trials. As I just mentioned, there are only approximately 4,000 patients who are diagnosed in the U.S. At the time of MOXIE Part 2, we enrolled patients at all seven U.S. F.A. specialty centers who were participating in the natural history study. MOXIE is one of the largest interventional trials completed to date and the only trial to demonstrate a significant effect on a functional endpoint that could support approval. There are a relatively small number of patients available for future trials with a design similar to MOXIE. Currently, approximately 1,200 patients have volunteered for clinical research and are participating in the natural history study. For MOXIE Part 1 and Part 2, we screened about one-sixth of available patients and enrolled most of them into the trial. Moving to Slide 9. The second reason that clinical trials in FA are challenging is due to the slow rate of progression of FA. As I just mentioned, patients with FA relentlessly progress. that even though these patients have early mortality, the progression occurs over their lifetime. The time from diagnosis to the death for a typical patient who is diagnosed in their teens and dies in their mid-30s is approximately 20 years. FA researchers have studied progression in a natural history study, and progression over one year is clinically meaningful to patients, even though the magnitude of progression over this time is relatively small versus patients' entire disease course. Because of this, outcome measures have been developed and validated to measure progression over one year. The Friedrich Cetaxia Research Alliance, or FARA, worked with the FDA to develop the MFARS scale to accurately track disease progression in FA patients. The scale is composed of four subsections, bulbar, upper limb and lower limb coordination, and upright stability. As patients lose function, their mFARS score increases towards a maximum score of 99 points. Even though the scale is 100 points, most patients are diagnosed with scores in the 25 to 30 range, and patients die before they reach a score of 100. Therefore, the dynamic range of the scale is approximately 40 to 50 points. Slide 10 highlights several examples demonstrating the clinical meaningfulness of a single point change in mFARS. Within each of the four MPAR sections, every single point matters. In the middle column are some representative assessments along with what a one-point worsening can mean to patients. The clinical impact of one point for stability or lower limb can mean differences in the ability to stand or walk independently. The clinical impact of a one-point worsening for bull bar or upper limb sections can mean losing the ability to speak or type. Even half a point can matter. A worsening of 0.5 points on speech can be the difference between normal and slurred speech. Slide 11 shows data from the Prospective and Ongoing Global Multi-Center Friedreich's Ataxia Clinical Outcomes Measures, or FACOM's Longitudinal Natural History Study. This study is enrolling up to 2,000 patients with FA with quantitative serial data, including MPHARs. Patients are being followed annually for up to 25 years. The data on this slide were published in 2016 and assessed data from patients over five years. The study evaluated multiple age cohorts. Shown here is the overall cohort, as well as the cohort of patients aged 16 to 40, which is the same age range studied in MOXIE Part 2. While MPHARs change only one point in the first year of follow-up in the age match cohort, over three to five years, MPHARs change on average about two points per year in both cohorts. Although changes in other measures were less apparent in a single year, the changes in MPHARs predict later worsening in other measures in this study. Next slide. The pivotal portion of MOXIE was a double-blind, placebo-controlled, randomized international study that was one of the largest global interventional studies ever completed in FA. We enrolled 103 patients across a wide and representative range of age and disease severity. The pre-specified primary analysis population, or full analysis set, included the 82 patients who did not have severe manifestations of the foot deformity pes cavus, and the primary endpoint was the change from baseline and MFARS scores at week 48. The analysis methodology we used to analyze the primary endpoint was MMRM. We used two covariates, clinical trial site and baseline MFARS, and importantly, all MFARS values at all time points, regardless of whether patients were receiving study drug, were included in the analysis. We did not impute for missing data in the primary analysis. MOXIE met its primary endpoint of change in mFARS relative to placebo after 48 weeks of treatment. Patients treated with OMAP demonstrated a statistically significant placebo-corrected 2.4-point improvement in mFARS compared to placebo after 48 weeks of treatment, with a p-value of 0.014. As we've discussed previously, we observed improvements in all subsections of the mFARS This change is clinically meaningful in that, on average, OMAP-treated patients did not progress during the 48-week treatment period and recovered function. Further, the placebo-corrected improvement is equal to more than one year of progression. Next slide. This slide shows a forest plot for sensitivity analyses compared to the primary result, which is on the top of the figure. Using a different analysis methodology, ANCOVA, the results were consistent with the primary results. To evaluate the impact of missing data, we conducted two analyses using different imputation methodologies. As mentioned earlier, all MFARS data from all time points were used, and overall, only 4% of MFARS values were missing, with 9% missing at the week 48 time point. Treatment-based imputation, which assumes that discontinued patients behave like patients in their treatment group, as well as control-based imputation, which assumes that discontinued patients behave like placebo-treated patients, both demonstrated a significant p-value supporting the conclusion of the primary analysis. Additionally, whether we look at the PESCAVUS population alone or the all-randomized population, the treatment effect favors OMAV. Overall, these sensitivity analyses support the robustness of the primary endpoint result. Turning to slide 14. The MOXIE extension trial is an ongoing open-label extension trial evaluating the long-term safety and efficacy of OMAV in patients with FA. A high percentage of patients were randomized into MOXIE part one and part two enrolled in the extension. Notably, 97% of patients from the MOXIE part two full analysis set who completed MOXIE part two were enrolled in the MOXIE extension trial. The discontinuation rate in the extension has been low, despite the length of the trial and the operational difficulties experienced during the pandemic. Of the patients from the full analysis set, 88% are still enrolled and being followed in the extension. Importantly, no new safety signals have been identified in the MOXIE extension trial. Next slide. As a reminder, The purpose of the randomized placebo-controlled MOXIE Part 2 study was to determine if there was a significant treatment effect between the OMAV and placebo-treated groups. And as discussed, this was demonstrated. The purpose of the delayed start analysis was to determine if this separation observed at the end of MOXIE Part 2 was preserved in the extension once all patients were converted to OMAV treatment. If patients who were originally randomized to placebo catch up to patients who were originally randomized to omav, the treatment effect is consistent with a symptomatic benefit. If the patients originally randomized to placebo do not catch up, and the difference at the end of the placebo control portion is maintained, the treatment effect is consistent with disease modification and a persistent effect on the course of the disease. This slide shows a graphical representation of the delayed SART analysis. All patients from the full analysis set are shown on the left, and the subset of patients who have completed extension week 120 are shown on the right. In the graphs, study weeks zero to 48, shaded in blue, pertain to MOXIE part two, with subsequent study weeks referring to the extension phase. I would like to point out that the timing of the MOXIE extension study coincided with the COVID-19 pandemic, so some MPHARS assessments which required an in-office visit are missing. As mentioned, 88% of the patients remain in the extension and patients have been returning to in-clinic visits over the past several months. Understanding the limitations in interpreting open label extension data, we see that patients originally randomized to OMav have continued to show a persistent treatment benefit with minimal to no worsening of the MFARS after three and a half years of total treatment. Of the six time points in the extension, all but one shows separation versus the patient's originally randomized placebo. The data suggests that the extension week 48 time point is an outlier, which was affected by COVID, and this is supported by the separation that was observed at extension week 72 and beyond. Beyond the missing data at this time point, investigators reported that the already challenging travel that these patients undergo to visit clinical trial sites was even more difficult during the pandemic, and this likely affected their sleep, exercise, eating, and other daily activities, which could have affected fatigue levels and other non-neurological aspects of their functioning. Of note, the same pattern of convergence at extension week 48 is observed in the completer's analysis shown on the right. Only a single patient is missing in each group at the extension week 48 visit, and convergence was observed. However, visits beyond extension week 48 show divergence, including extension week 120, which includes all patients. These data further demonstrate that the extension week 48 time point is an outlier. The completer's data also address one other question raised by the full data set on the left. It appears on the graph on the left that the placebo to OMAD patients may be losing their treatment effect at extension week 120. However, as can be seen in the figure on the right, this is an artifact of this subset of patients who on average have longer GAA1 repeat lengths, which is associated with a faster rate of progression. As you can see in the blue shaded region of the figure on the right, these patients progressed approximately four MFARS points over one year while they were receiving placebo, from randomization until the day they entered the extension and started receiving OMav. However, over the subsequent two and a half years while receiving OMav, these patients only progressed one mFARS point on average, which is much lower than would be expected based on their rate of progression before they received OMav. As shown on slide 16, we have also evaluated the progression of mFARS for OMAP-treated patients in the extension study by computing annualized mFARS slopes. This calculation of annualized slopes allows all available data through extension week 120 from all FAS patients to estimate the treatment effect over a period of approximately two and a half years. A total of 257 mFARS assessments contributed to this analysis from 73 patients. And as I mentioned, in the extension, the discontinuation rate has been low at 12%, with only 9 of 73 FAS patients having discontinued. As you can see in the table on the left, the annualized rates progression in the extension had been 0.27 and 0.45 MFARS points, and the difference between these two subgroups is not different, suggesting a similar treatment effect. While a placebo control during this phase was not included and formal comparisons cannot be made, the observed rate of progression is much lower than would be anticipated. The same 39 placebo to OMAP patients progressed 1.42 points in the 52-week period from randomization into MOXIE Part 2 until initiation of treatment in the extension. Using natural history data as a benchmark, the overall cohort progressed at an average rate of 1.95 points per year and a similar age-ratified cohort progressed at an average rate of 1.71 points per year over a three-year period. These data, in addition to the delayed start analysis, suggest that OMAP has a durable, persistent effect on the course of FA. I'll now have Simi Khan provide an update on our other clinical development programs.