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spk03: Thank you for standing by, and welcome to the Ventex Final Science's second quarter 2022 earnings 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 this session, you'll need to press star 11 on your telephone. As a reminder, today's program may be recorded. And now I'd like to introduce your host for today's program, Marty Oster, Chief Financial Officer.
spk08: Please go ahead, sir. Thank you, Jonathan. Good afternoon, everybody. Thanks for joining the call today. Welcome to Ventex Biosciences conference call and webcast. We'll be discussing top-line results from the Phase I trial of our TIK2 inhibitor, VTX958. As a reminder, you can find press releases issued today covering the Phase I results from VTX958, as well as our second quarter financial results on our website at www.ventexbio.com under the Investor tab of the News and Events section. Before we begin today, I'd like to remind everyone the conference call webcast will contain forward-looking statements, including statements about the potential and positioning of 958 and related market opportunities, the timing of commencement, enrollment, and completion of clinical trials, the anticipated timing of release of clinical trial data, and the expected timeframe for funding operations and current cash equivalents and marketable securities. These statements are subject to risks and uncertainties that could cause actual results to differ, and please note that these forward-looking statements reflect our opinion only as the date of this call. Factors that could cause actual results or outcomes to different material from those expressed or implied by such forward-looking statements are discussed in greater detail in our filings with the SEC, including our Form 10-Q for the second quarter of 2022, which we do expect to file this afternoon. Today's call will feature a presentation hosted by our CEO, Dr. Raju Mohan, and our President and Chief Medical Officer, Dr. Bill Sanborn. Following the presentation, we will open the call to your questions, and at that time, Raju and Bill will also be joined by our Executive Chairperson, Sheila Kudrati, and our Chief Business Officer, Chris Krueger. We're also joined today by a special guest, Dr. James Krueger. In addition to serving on the Ventix Scientific Advisory Board, Dr. James Krueger is the Director of the Milstein Medical Research Program and the D. Martin Carter Professor in Clinical Investigation at Rockefeller University in New York. Dr. Krueger is a board-certified dermatologist and is recognized as a world-renowned research expert on the pathophysiology and treatment of psoriasis. With that said, I will hand the call over to Dr. Raju Mohan, our CEO and Ventix's founder, to walk you through the slides. Thanks.
spk14: Richard, go ahead. Thanks, Marty, and good afternoon, everybody. It's a pleasure to be able to have the opportunity to present the phase one results. Slide three, please. Before we talk about BGX958, which is the focus of the call today, 958 is going to go into phase two trials, and Bill will talk more about this later in the discussion. initiating three phase three trials in Q4 of 2022. Really want to highlight our portfolio of small molecule compounds, differentiated molecules, all internally discovered, and we owned all IP rights to these compounds. So in addition to 958, we have BTX002 S1P1 modulator. This compound is currently in phase two studies in ulcerative colitis, and we will report top line data for this compound in 2023. Then for our NLRP3 portfolio, our peripheral compound, VTX2735, it's a potent inhibitor of NLRP3, and we've announced phase one results in July of this year. We plan to initiate phase two trials in CAPS patients in Q4 of 2022. In addition, we'll be disclosing additional opportunities for developing this compound also later this year. And finally, VTX3232. This is also in the NLRP3 class. This, however, is a brain penetrant, a CNS penetrant NLRP3 compound. This compound is currently in IND enabling studies. We plan to initiate phase one trial in Q1 of 2023. So that is a portfolio of small molecule compounds. Let's move to the next slide, please. Why the excitement on TIK2? So TIK2 is a clinically validated target from two angles. One is the established efficacy of biologics, IL-23 and IL-1223, all targeting clinical efficacy in IBD, in psoriasis, in psoriatic arthritis, and the other target of TIK2 is interferon-alpha and now validated in lupus. So in addition to the biologics that also validate this target, allosteric TIK2 inhibitors also target the same pathways, IL-1223 and NF-1-alpha, and thus TIK2 is clinically validated in these targets, not just by the biologics that target these pathways, but also by a small molecule, Ducravacitinib, that has shown efficacy now in psoriasis, psoriatic arthritis, and most recently in lupus. As you know, These are large, the disease that we've talked about here are large markets in the autoimmune disease space, totaling close to $50 billion worldwide. And there's clearly a high unmet need for oral agents because this market, as you know, is currently dominated by biologics. So where does that position VTX958? It is a highly selective TIK2 inhibitor, an allosteric inhibitor. And what we will show you today and what Bill will share with you is the high Selectivity of this compound will differentiate this compound from compounds that are less selective that have shown that profile is borne out in the clinical trials. And the positive phase one data that we'll show you today will establish the therapeutic window of this profile, demonstrate the excellent safety profile, and this all leads to class-leading target coverage of cytokines of interest and positions VTX95A for success across multiple indications that we are planning to start in the second half of this year. Next slide, please. Slide five. So, right from the beginning, our chemistry strategy has focused on the allosteric domain of TIK2, classic JAT inhibitors target the kinase domain. This domain is highly conserved within the JAT family. And while it's easy to get potent compounds, These compounds generally have very poor selectivity. They cross over into all the entire JAK family. They had JAK1, JAK2, and JAK3. By targeting the Allosteric domain, which is much less conserved, one can actually get very high selectivity from this approach. And that's exactly what we have done with VTX958 shown in the panel here. And thus, VTX958 had selectivity for TIG2 in the Allosteric domain versus JAK1. It's about 4,000-fold selective. It has almost no affinity for JAK2 and JAK3. There is no binding to any JAK2 or 2 allosteric domains. There's absolutely no activity via the kinase domain, and no kinase enzyme inhibition has been shown in our assays for any JAK family members. So as a TIK2 inhibitor, targeting the allosteric domain of TIK2 affords inhibitors of high selectivity against other JAK isoforms and inhibitors Very important here, avoids potential safety risks that are associated with compounds that either hit JAK1 or 2 or 3, or compounds that are not as selective as VTX9, 5, 8. Slide 6, please. So if you look at, so both the prolacitinib and VTX9, 5, 8 are both bona fide allosteric TIK2 inhibitors. Where the difference comes up is in the binding of VTX958 to the allosteric domain of TIK2 versus binding to the allosteric domain of JAK1. Now, if I can focus you on the table below, going to the VTX958 column, VTX958 has 4,000-fold selectivity for TIK2 versus JAK1 in the allosteric binding. In contrast, the KRAVA system has only about a 50-fold selected profile for TIG2 versus JAK1. And just a little bit of a structural lesson in here. And the reason why we've been able to do this is that we both, 958 and the KRAVA, both exploit the valine, which is present in the TIG2-JH2 domain. They both bind to it. What we have done with 958 is build a compound such that it has an negative interaction with the isoleucine, which is now a substitute for valine in the JAK1 domain, and whereas ducravacitinib can still bind to this isoleucine, and this binding difference between VTX958 and its steric repulsion with the isoleucine versus ducravacitinib that can bind to it results in this very high selectivity that we've shown for this compound. So this is the binding differential for 958, 4,000-pole selector for TIK2 versus JAK1. Next slide, seven, please. Where this has the biggest impact is now on the functional selectivity of 958. Functional selectivity in its ability to now selectively hit TIK2-driven cytokines, IL-12, IL-23, and if you're on alpha, you can see that there with the pralacitinib, they're both bona fide allosteric compounds. They both hit IL-12, 23, and alpha. Where the difference is most striking is in the right-hand column, where VTX958 has no affinity for these pleiotropic cytokines. These are protective cytokines that you do not want to block. So VTX958, in all the assays that we have run across a panel of cytokines, has no inhibition of IL-22, no inhibition of IL-10, no inhibition of interferon gamma, no inhibition of IL-4, no inhibition of IL-6. So a composite of cytokines, all with a single message. We are highly selective PIK2 versus JAK1. And then the Kravacitinib, which has some interaction with JAK1, then ends up inhibiting the entire panel of cytokines, IL-22, 10, gamma, 4, and 6. So coupled with the high selectivity of PTX958, And the safety profile that we've now seen, first from non-clinical safety assessment, and now from the safety data that Bill will present to you in the subsequent slides, really allows us to reach this broad therapeutic window. In addition to hitting the potent cytokines, we talked about IL-23 cytokines that have been implicated in psoriasis, in psoriatic arthritis, in Crohn's disease. It really allows this therapeutic window, the safety profile of this compound, this Unmatched target coverage allows us to attain safely assumed exposures, higher exposures in phase two and phase three studies to then elicit maximum efficacy in these disease indications. Slide eight, please. So with that, I'm going to hand over to Bill to walk you through the phase one results.
spk11: Bill. Thank you, Raju. And just to remind the listeners, on this platform, you need to advance your own slides, and we're currently on slide nine. So what are the goals of our Phase I study? It's really to show the safety, exposure, and the target coverage of VTX958, and specifically to maximize the exposure in the multiple ascending dose cohorts with both QD and BID dosing regimens, to evaluate the safety profile through all of the dose cohorts in this 14-day dosing study, to determine the target coverage of tick-mediated cytokines interleukin-12, 23, and interferon-alpha to demonstrate direct evidence of TIK2-driven target engagement in subjects by validated in vivo and ex vivo pharmacodynamic assays. And I'll note that in phase one healthy volunteer studies with ducravacitinib that the results of this panel of pharmacodynamic assays read through very well after the assay demonstrated in phase two and phase three clinical trials and various indications. And finally, to establish the correlation between BTX958 exposure and TIK2-IC90 coverage in terms of hours per day coverage. Next slide, slide 10. So what's the summary of the data that I'll show you? These really roll up to safety, exposure, and target coverage. Firstly, BTX958 was well tolerated across all of the SAD and MAD cohorts. All VTX958 drug-related adverse events were classified as mild. There were no dose-dependent trends in the frequency of treatment emergent adverse events. And there was minimal off-target adverse events observed with VTX958. And this is relative to other allosteric TIK2 inhibitors, which I will review in a few minutes. Secondly, VTX958 exhibits class-leading TIK2 IC90 coverage. meaning that we achieved TIK2-IC90 coverage for up to 24 hours with no dose-limiting toxicities. And finally, we saw robust dose-dependent pharmacodynamic activity in ex vivo and in vivo assays, supporting the hypothesis that greater pathway inhibition may enable differentiated efficacy in the clinic. Moving to slide 11, this is the schema for the single ascending dose part of the Phase I study. VTX958 was administered as a suspension. There were seven dose levels ranging from 50 to 500 milligrams, eight subjects per cohort, six active and two placebo. Each subject received a single dose of VTX958, then had a washout and was redosed, this time with an interferon alpha challenge. And this occurred at each of the seven dosing levels. Looking in the lower right, VTX958 was well-tolerated through all the seven cohorts. All adverse events were classified as mild. There was no temporal relationship to dosing. There were no clinical laboratory adverse events of concern. And significant pharmacodynamic effects as measured by interferon response genes and IL-12 signaling following interferon alpha challenge and ex vivo stimulation was observed. I'm not going to show the detailed results because the multiple ascending dose is really the area of greatest interest. Moving now to slide 12, here's the schema for the multiple ascending dose study. You can see we studied five dose cohorts, alternating BID cohorts at 50 BID, 175 milligrams BID, and 350 milligrams BID, and in between 250 milligrams per day and 500 milligrams per day. These five dose cohorts were dosed for 14 days. There were, again, eight subjects per cohort, sex active and two placebo. The primary objective was to measure the safety and tolerability and to determine the therapeutic concentration and the dose correlation with target coverage for the TIC targets for both IC50 and IC90 coverage. Pharmacodynamic analyses were done. These included an in vivo interferon alpha stimulation on day 13, and then transcriptome analysis of TIK2-responsive genes pre and post interferon alpha challenge, and secondly, an ex vivo IL-12-18 stimulation at baseline and at day 10. As I noted, the interferon alpha stimulation was on day 13. We did that up through cohort four. As you'll see shortly, the interferon itself causes a lot of adverse events, so we didn't do the interferon challenge in the final dose score. Moving now to slide 13, I want to orient you to this. We're really focused on the exposure and target coverage across the cohorts for the three TIK2 targets, interleukin-12, interleukin-23 and interferon-alpha. When you compare and contrast this to other compounds, make sure that you're really understanding which of these or all of these that are being covered. What you can see here, we'll begin with, is just looking at the two QD doses. You can see that for IL-12 and IL-23, you have four to six hours of IC90 coverage and nine to 14 hours of IC90 coverage or IC50 coverage. and just even a little bit more coverage for interferon-alpha. If you go up to the BID doses at 175 and 350, you can see that we have 16 to 24 hours of IC90 coverage for IL-12 and 23, and 24 hours of coverage for IC50, and similar results for interferon-alpha. When you roll this together, we see safety achieved with class-leading TIC-2 IC90 coverage. The IC90 coverage lasts up to 24 hours for IL-12, 23, and interferon-alpha. And the exposures that we demonstrate here approach biologic-like or monoclonal-like suppression of IL-12 and 23 pathways. Moving to slide 14. So let's transition now to the safety assessment. All of the drug-related adverse events were classified as mild. There were no serious adverse events, no patients discontinued therapy, and there were no dose interruptions. There were no dose-related trends in the frequency of treatment of merchant adverse events observed. There were minimal dermatologic adverse events. The skin and subcutaneous disorders were reported in a total of three patients in the phase one trial. That's just 10%. Remember that number as we compare and contrast that to other allosteric TIK2 inhibitors in a few minutes. All of these adverse events were classified as not drug-related. There were no observed infections, cytopenias, or lipid abnormalities. We believe that these data are consistent with a potential best-in-class therapeutic window. in the context of the ability to achieve for up to 24 hours TIK2-IC90 coverage with a favorable safety profile. Slide 15. Here's some of the details for the adverse events. We divided the adverse event reporting into pre-interferon challenge safety assessment, which goes up until the time of the interferon challenge partway through day 13. And then I'll show you on a subsequent slide the adverse events that occurred after the interferon challenge. Interferon alpha causes a lot of side effects, and so we split this out so you can better see the potentially drug-related side effects. Walking through this, you can see headaches, soft feces, and a smattering of patients, no clear relationship. There were three patients that had a skin manifestation, papular rash. In the 250 Q-day cohort, there was a single papule on the lower right cheek judged not to be drug-related. It was mild. It resolved with continued VTX958 dosing and did not have any topical therapy to the lesion. This is such a tiny thing that we're really almost dismissing this as being related. Then there were two patients at the 350 BID cohort. cohort who had skin papules. One of those, these were mild papules judged to be not drug-related. One subject had mild face papules that resolved with continued VTX958 dosing and, again, no topical therapies of lesion. There was a second subject with mild face and trunk papules that improved but did not completely resolve with continued VTX958 dosing, again, no topical therapies. There were some patients with dry mouth and abdominal pain. There was one patient that had liver transaminase elevations. These were judged as mild and occurred in the context of a COVID-19 infection. Moving on to slide 16, here are the adverse events that occurred after interferon alpha challenge. You can see that they occur frequently in both placebo and BTX958, and there's the sorts of things you would expect to see with interferon-alpha. There was one patient that had a rise in ALT just after the interferon-alpha dose, which resolved thereafter. Moving on to slide 17. Looking at the potentially JAK-related hematologic and chemistry panel findings, there were no changes over time in hemoglobin, neutrophils, lymphocytes, or platelets. no changes in creatinine phosphokinase, and no changes in lipids. Moving on to slide 18. So now transitioning from safety to the pharmacodynamic effects, we saw robust dose-dependent pharmacodynamic effects. On the left, you can see complete suppression of all IL-12 signaling. There was dose-dependent inhibition of interferon gamma after dual IL-12-18 stimulation at all time points. These data imply complete suppression of IL-12 signaling. And I note that IL-12 and 23 share the TIK2-specific heterodimer IL-12R-beta-1. So we believe that this inhibition of IL-12 signaling also indicates inhibition of IL-23 signaling. And you can see the data in the graph below. Moving to the right side, we also saw robust inhibition of TIK2-responsive genes. including CXDL10, ISG20, and IFI27. These genes are direct downstream targets of interferon alpha and display diverse onset, amplitude, and resolution kinetics. There's potent exposure pharmacodynamic activity in all three genes, and the response is dose-related through all the cohorts tested. In the table below, you can see the impact on these tick-mediated genes expressed as the percentage of inhibition relative to placebo for the 175 milligram BID dose, and what you can see is really dramatic inhibition through most of the day for all three genes. Moving on to slide 19. So, in summary, we believe that we've demonstrated class-leading target coverage with excellent safety and exposure margins. VTX958 demonstrated differentiation versus Dicravacidinib and other allosteric TIK2 inhibitors in terms of safety and target coverage in the Phase I MAD study. VTX958 achieved TIK2 IC90 coverage for up to 24 hours. There's a broad therapeutic window with biologic or monoclonal antibody-like suppression of IL-1223 pathways And we note that VTX958 is the only allosteric TIK2 inhibitor to demonstrate safe and sustained coverage of IC90 for IL-12, 23, and interferon alpha. Moving on to slide 20, we'll now spend a few minutes looking at the differentiation and development strategy for VTX958. Moving on to slide 21. So let's think about this profile relative to Ducravacitinib and what the opportunity is to differentiate VTX958 in terms of an improved therapeutic window. First generation allosteric TIK2 inhibitors like Ducravacitinib are limited by toxicities. Ducravacitinib at a six milligram dose, which is the phase three psoriasis dose, achieves IC50 coverage for about nine hours and never achieves IC90 coverage. There's a dose-dependent exposure of skin toxicities, and I'll get more into that in another slide, including acne and rash with Ducravacitinib, particularly above the 6-milligram QD dose. And we would expect that fuller pathway inhibition with an improved therapeutic window would be expected to drive to differentiation of BTX95A versus Ducravacitinib. meaning that we'd have greater coverage of the TIK2 IC50 and especially IC90 that could be expected to drive improved efficacy, not only in indications like inflammatory bowel disease, where very high doses and IC90 coverage may be necessary, but also improved efficacy in indications such as psoriasis and psoriatic arthritis. And on the left, you can just see the time versus concentration curves. for Ducravacitinib at the psoriasis dose of six milligrams once a day, as well as a 12 milligram once a day dose. And you can see that both of these have IC50 coverage for part of the day, but no IC90 coverage. Next slide, slide 22. So let's get into the details of the skin adverse events and target coverage a little bit. I'm gonna focus you to the table on the right initially on the second line. So these are the Ducravacitinib phase one MAD data in healthy volunteers. I'll remind you this is a 14-day study with interferon alpha challenge on day 13, so exactly the same as what we saw. And in the context of a 14-day study, once you get to 6 milligrams BID or 12 milligrams QD, you're seeing 33% to 50% rolled up skin adverse events. As you go up to 12 milligrams BID, it's almost 80%. And across all of the doses that were studied, it's 42% of patients. I'll remind you that I showed you a few minutes ago that our rolled up skin manifestations with BTX958 are, by contrast, 10%. Then if you look down to the various phase two and phase three clinical trials, you can see that if you stay at the six milligram QD dose or three milligrams VID, you can have acne and rash in the sort of two to 4% range. although with lupus, if you looked at all skin AEs at 3 milligrams BID, it was still 17%. But then when you get up to 6 milligrams BID and 12 milligrams QD, you're getting often in the 9 or 8, 9, 10% range acne and rash. In the lupus trial, where they reported all of the skin manifestations together, you can see it's 34% of patients with both of these doses. And then just to remind you, the 6-milligram QD dose has 9 hours of IC50 coverage for TIK2 and 0 hours for IC90. And even as you get up to 6 milligrams BID and 12 milligrams QD, you're having 18 hours of IC50 coverage and 0 hours of IC90 coverage. So very different coverage than what you see with VTX958, and yet significant dose-dependent dermatologic adverse events. So we believe that these data establish robust differentiation versus Dicravacitinib. We note that Dicravacitinib elicits a dose-dependent and potentially dose-limiting skin toxicity. These skin findings occur with high frequencies at exposures greater than 6 milligrams per day. And by contrast, the VTX958 demonstrates the potential for a best-in-class therapeutic window, meaning that we've achieved high TIK2-IC90 coverage without frequent skin adverse events. Next slide, slide 23. So I want to level set you here. This is comparing three different allosteric TIK2 inhibitor phase one data. So these are 14-day trials and healthy volunteers with a interferon alpha challenge at the back end of the trials. And we'll start with BTX958. So we looked at total daily doses ranging from 100 to 700 milligrams per day. We saw skin and subcutaneous disorders at 10%. These were papular rash in all three patients, but I'll remind you that one of those at the 250 Q day dose was just a single papular rash that was judged not related and resolved under therapy. So quite low skin manifestations, and we had a single patient with elevated transaminases that were mild in the context of the COVID infection. If you look at the Clinically relevant doses of 175 BID and 350 BID, we have 16 and 24 hours of IC90 coverage, respectively, and 24 hours of IC50 coverage. Now let's, on the right, look at Ducravacitinib. They studied in Phase 1 healthy volunteers, doses ranging from 2 to 24 milligrams of total daily dose. The overall skin And subcutaneous disorders were 42%, including rash, 20%, and acne, 13%. At the relevant clinical dose of 6 milligrams QD, there was IC50 coverage of 9 hours and IC90 coverage of 0 hours. In the middle, we see the Nimbus compound. There were a couple of dose ranges looked at, 20 to 35 milligrams QD and 50 to 100 milligrams QD. You could see up to 67%. Acneiform dermatitis, a papular rash in up to 25% of patients. Patients that developed a grade 3 CPK elevation on 20 milligrams. If we consider 30 milligrams as a clinically relevant dose, there's 24 hours of IC50 coverage and about five hours of IC90 coverage. Going on to slide 24. So here we're stepping away from just focusing on healthy volunteers. The totality of the opportunities and available data and focusing on the clinically relevant doses. So with BTX958 at 175 BID, 24 hours of IC50 coverage, 16 hours of IC90 coverage. For that dose and below, essentially no skin findings, no laboratory findings. And we believe this represents a best-in-class therapeutic window not only for inflammatory bowel disease, but also the opportunity to leverage and maximize the dose response in psoriasis and psoriatic arthritis above what was achievable with Ducravacitinib because of the limited therapeutic window. For Ducravacitinib at the relevant dose of six milligrams per day, nine hours of IC50 coverage, no hours of IC90 coverage, you see dose-dependent acne, acneiform dermatitis, folliculitis, and rash especially if dose is more than six milligrams QD, so that's dose limiting. You can see rare CPK and triglyceride elevations in the psoriasis phase three trials. We note that there was a failed trial of Ducravacitinib at a six milligram BID dose in ulcerative colitis, and I think I've explained why, that they really wouldn't have the IL-12 and 23 coverage you would expect to see for efficacy in inflammatory bowel disease. More on that in a moment. And we think there's still an opportunity to go up, as they really showed in their phase two trial, for some of the more robust outcome measures, like PASI-90, where there was a limit, a linear dose response across all the doses studied. And finally, with this Nimbus product at a relevant dose of 30 milligrams QD, 24 hours of IC50 coverage, only five hours of IC50. 90 coverage and they see acne rash and skin manifestations. There's been a case of neutropenia, CPK elevation, and triglyceride elevations. They currently have no active programs that we're aware of in inflammatory bowel disease. Moving on to slide 25. So let's look at the sort of commercial opportunity here. We've thought of the biologic compounds directed against interleukin-17 and IL-23. as currently sort of the best-in-class compounds for psoriasis, and you can see 85% to 90% response rates for PASI-75 outcome measures. Otesla is about a third of that, the PASI-75 in the 30% range. Ducravacitinib is superior to Otesla, but still only achieving low 50% range PASI-75. So there's a large gap between what is achieved with Ducravacitinib at the six-milligram once-a-day dose and what you can see with the biologic therapies. So their aspirational target for DTX958 is to close that gap because of our superior target coverage where we can cover IC90 for much of the day. Moving on to slide 26, focusing on IBD. We know from biologic agents that higher doses, and we think that reads through to higher target coverage, is required for Crohn's disease. You can see here for Skyrizzy, Trimthia, and Solara that you need four to six times as much biologic to see efficacy in Crohn's disease as you do in psoriasis. And this greater TIK2 pathway inhibition that's required for IBD efficacy from biologics suggests that higher exposures will be required with other drugs as well for efficacy in Crohn's disease versus psoriasis. I already noted that ducrapacitinib phase two in ulcerative colitis failed at the six milligrams BID dosing, but we know that despite the fact that dose is already associated with skin side effects, But there's zero hours of IC90 coverage, so this is sort of an expected result. Higher doses of VTX95A may approach biologic or monoclonal antibody-like suppression of the IL-12 and 23 pathway. And because of this, this profile of VTX95A may unlock a major market opportunity in Crohn's disease, which is currently greater than the $13 billion global opportunity. Moving on to slide 27. So how do we think about what's next in terms of the development opportunities? We will later this year begin phase two trials that will explore a broad range of dose finding studies, enabling optimal phase three dose selection based on the safety and maximizing target coverage. Specifically, we plan to initiate three phase two trials in the fourth quarter of this year in psoriasis, Crohn's disease, and psoriatic arthritis. We're also looking at additional indications in phase two, which could include lupus, given the unique profile of VTX958. These phase two trials will be dosed with an immediate release or IR tablet. A modified release formulation is in development to approximate the BID exposures with the QD solid oral dose form. And we would, of course, do a bridging study before phase three There's precedent for this. This was done with RENVAC and Zeltans and other drugs, and we see this as a straightforward proposition. Moving on to slide 28. So how does this wrap up? This shows you the landscape of the IL-23 and 17 biologics and the oral agents, aprilamast, ducravacitinib, and the aspirational target product profile for BTX958. We see very strong efficacy for psoriasis in IL-23 and 17, as we've already discussed, and we believe that with our target coverage, BTX958 could do similarly. We see strong psoriatic arthritis treatment with those agents as well, and we anticipate the same for BTX958. For Crohn's disease, we think that anti-IL-23 It's probably best in class. You can't really use anti-IL-17 in Crohn's disease or ulcerative colitis. It's not applicable to aprilamast. We don't know yet for dicravacitinib, but based on the data I showed you earlier, I would speculate that the studies looking at 6 milligrams BID or 12 milligrams once a day are unlikely to be effective in Crohn's disease, whereas we expect that VTX958 will have a biologic-like effect. Same story for ulcerative colitis. and finally for lupus. So if we summarize this, VTX958 has an excellent safety profile, class-leading TIK2 coverage, potentially superior therapeutic window compared to anything else in the oral classes. There's a unique opportunity in inflammatory bowel disease, and we're well positioned to capitalize in several biologic-dominated autoimmune markets. Slide 29. And this is just to make the point that these markets are big, almost 11 million patients in the United States across these indications. And on the right, as Raju said earlier, almost a $50 billion global market. This is dominated by psoriasis, Crohn's disease, and ulcerative colitis with smaller contributions from psoriatic arthritis and lupus. And as I showed you on the previous slide, we have the opportunity to markedly impact each of these markets. So, BTX958 will enable clinical differentiation across multiple indications. It has the potential to offer a differentiated clinical profile in psoriasis, psoriatic arthritis, and lupus by dosing to levels of tick inhibition that are greater than that that can be achieved with competitors with a more narrow therapeutic window. be uniquely positioned among tick inhibitors to address Crohn's disease and IBD indications where IL-1223 and IL-12 antibodies have proven effective at higher doses than it is what you do in psoriasis. I'll stop here and hand it back to Raju to wrap up. Please move on to slide 30. Yeah, I think that's really summed it up, Bill.
spk14: So thank you again. And I think in interest of time, why don't we open up the forum to a Q&A.
spk03: Certainly. Ladies and gentlemen, if you have a question at this time, please press star 1-1 on your telephone. One moment for our first question. Our first question comes from the line of Yasmin Rahami from Piper Sandler. Your question, please.
spk05: Good afternoon, team. First of all, congrats to the really stellar data. An outstanding job. Thank you for taking my question. A couple of clarification questions. In the math portion, when you refer to some of the skin rash that it wasn't related to the drug. How do we know it's not an on-target effect? If you could just elaborate a little bit there. And then my second question was, you nicely showed cholesterol levels. Did you measure triglycerides and LDL-C if it was just cholesterol, just one of the biomarkers showing its representation of a long list of lipid biomarkers that were assessed? And then two more small questions for you.
spk14: Yeah, so let me have Bill address the rash ones, but I can speak to the lipids. So we did measure triglycerides. There was no change. We looked at LDL cholesterol. There was no change. There was no change in any lipids or cholesterol in the study. We just highlighted cholesterol for brevity here, but there was no change at all in any fatty acid compositions, no lipids, no triglycerides, no cholesterol.
spk11: Bill? Yeah, the judgment of relatedness for the rash is really done by the investigator, so it's sort of up to them. I take your point and don't disagree with you that the two papules seen in the highest dose groups, the 350BID, could easily be related to the medication. But, you know, I think the key point is that it was very clean up to that point. And even those two cases, one completely resolved under continued therapy, and the other partially resolved. If you go back and look in detail at the dermatologic adverse events in the phase one healthy volunteers with Ducravacitinib, there were a number of cases where the skin manifestations led to early discontinuation of the treatment during the MAD study.
spk05: Thank you, Dr. Sanborn, and thank you, Raju. The one case of where ALT, AST, and GGT increased, and those were classified as mild. I assume mild means nothing over, you know, greater than 2x of the upper limit. Just define what you mean with mild. And then did that just occur before they got COVID and they went down just to kind of, or did they start off with slightly elevated liver enzymes? And then so once they're on 350, it's got increased, just some color around that. And then the last question is, what's they got COVID and they went down just to kind of, or did they start off with slightly elevated liver enzymes and then so once they're in 350, it's got increased, just some color around that. And then the last question is what sort of the dose ranges you're planning to go into your psoriasis study and into your Crohn's study or at least discuss all that? And thank you for taking my questions.
spk11: Yeah, for the For the patient where there was COVID, you know, you can often see a low level of enzyme bouncing around. But the rise really occurred in the context of about when the COVID infection started. And the second case, as I indicated, was the mild elevation that occurred immediately after the interferon alpha challenge. And in terms of doses, I think we're not prepared to outline exactly today the doses we'll take into phase three, but it would take into account the totality of the efficacy or the safety data and the target coverage. And we anticipate exploring doses that cover most of the day for IC-19.
spk05: Thank you, Dr. Sanborn, and congrats again, team.
spk03: Thanks, Jess. Thank you. And our next question comes from the line of Michael Yee from Jefferies. Your question, please.
spk00: Hey, guys. Thanks for the question, and congrats on the great data. Maybe just a question for Bill or the team. Now that you have all this great data in hand, I know a lot of people are turning to the class as a bigger picture and Ducravacitinib. Purportia will get approval soon. So, you know, any thoughts around how to think about the scenarios with what that class label might look like and how we should think about the implications for second-generation TIC2s, particularly with a much better coverage, but also in the context of risk-benefit in these types of indications versus, say, psoriasis. So maybe Bill can answer that or anyone on the team can answer that. Thanks.
spk14: Yeah, thanks. Thanks. Thanks, Mike. And what a surprising question. The good news is, you know, less than four weeks from now, we'll be on the other side of it. But anyway, it's a good question on that. Maybe, maybe, Marty, Oscar, maybe, Marty, you want to take this one?
spk08: It's my chance to get some exercise in. Hey, Mike, thank you for the question. So obviously, as we all know, Ducreviscalib ran a really nice phase three program with the six milligram QD dose where they showed superiority on efficacy. Tesla showed a really nice safety profile. That leaves us probably similar to Bristol in terms of optimism about the approvability of that drug. I think right there, there's already a pretty clear differentiation in terms of the regulatory path from what you've seen with like JAK inhibitors, obviously, and psoriasis where there's been a couple setbacks for JAKs looking at that indication. So I think there's already pretty clear signs of differentiation from regulators around this TIC-2 class versus Jack Inhibition. Obviously, like you, we're, you know, eagerly awaiting to see what that label looks like. And obviously, the more or the less restrictive the label, we think the faster the TIC-2 class is going to kind of gain ground within the $20 billion plus RISIS market. And we're obviously, you know, very excited about the prospects there. And our advisors and our KOLs are incredibly optimistic about TIC-2s and RISIS as well. So we're looking for that update as you are. Is there anything else you want to add, Bill?
spk14: I think that's great. We'll see what happens in less than four weeks.
spk00: Thank you.
spk03: Thank you. And our next question comes from the line of Josh Scheimer from Evercore ISI. Your question, please.
spk07: Very detailed, helpful overview. Maybe first the Phase II trials, if you could get your thoughts on expected size and duration.
spk14: Yeah, Bill?
spk11: I don't know that I'm going to give the exact details, but the way to the track record for how to do this is pretty well laid out with Ducravacitinib. So psoriasis phase two trials are generally in the phase of about 200 patients, and psoriatic arthritis trials are something in that range as well. For Crohn's disease, we'll do something You know, it'll be appropriately powered and give a range of doses. In terms of duration, we're anticipating sort of that 16-week range for psoriasis and psoriatic arthritis and probably a 12-week range for Crohn's disease. We anticipate extension programs for each of those indications as well.
spk07: Thanks, Bill. Thanks. Excellent. And then slide seven, where you show the IC50s for 958 versus Ducrevacidinib. But I would have thought that there's decent enough selectivity for Ducrevacidinib for the Th1 cytokines over the protective cytokines in order to provide, you know, good efficacy coverage without safety concern. But the IL-10 looks like an outlier from that framework. It looks like it would be actually pretty challenging to inhibit the Th1 cytokines without without also inhibiting IL-10 for Ducravacitinib. So can you discuss first, do you think the IL-10 inhibition is likely underlying some of the Ducravacitinib toxicity? And why would IL-10 specifically be an outlier in that it's more sensitive to Ducravacitinib than some of the other cytokines that you've shown on that slide? Thank you.
spk14: Bill, you want to take that?
spk11: Well, for the Dermatology adverse events, we do think that those are off target and not on target. And the reason for that is, as I pointed out, the dosing profiles that have been done in inflammatory bowel disease for the IL-12 and IL-1223 inhibitors are very high, and there's just no signs of dermatologic adverse events. And likewise, the approved product for lupus or type 1 interferon antibody also doesn't show any skin side effects. So it's difficult to believe that those dermatology off-target or adverse events are on target, meaning they must be off-target. Whether they're exactly JAK1 or something else, as you're pointing out, I think is a little hard to tell, and no one knows for sure, but we see them as being off-target.
spk14: And Josh, you know, and you and I have talked about this before, there's some indication that IL-10 And IL-1022 acts as an effect on barrier integrity, so direct effects on filigrene and laurocrine, and also on some microbial defense. So there's clearly a link that can be established. Now, as Bill said, is it something that's directly linked to JAK1? But certainly you can explain it through targeting IL-10 and 22.
spk07: Got it. Thanks very much.
spk03: Thank you. And our next question comes from Credit Suisse. Your question, please.
spk09: So just too quick for me. So the first one is, again, now that you have line of sight and I'm running three phase three trials for 958, you also expect to run a phase two for CAPS for 2735. I'm curious if your plans have changed at all or evolved in terms of potential partnerships or at what point do you start to run into resource issues? Is this something that you can endeavor to take all the way across the finish line for the Phase IIs across the board? How are you thinking strategically about that development? And then just on the modify release formulation, just curious if you can provide any additional details as of now on What technologies are you using to try to get that BID exposure with the QD or dosing? Again, kind of combining the benefits of the safety profile and the 24-hour coverage. Thank you.
spk14: Oh, yeah. So let me take the modified release first. It's pretty straightforward. We're working with a terrific CRO, a tremendous experience in developing modified formulations. We have multiple, you know, aiming for multiple formulations to go into human studies, and we'll start to share data as early as first half of 2023. So non-clinical data here, and then including animal TGA and other in vitro studies looks very promising, and that feeds into the design of the protocol. So very confident we'll have a update for you folks in first half of this year. So I'm not gonna go into the CROs, but we're working with some highly experienced people and a great compound to work with, right? So I think that's the answer on the MR. In terms of the financing question, so look, we're, as Marty put out in his earnings release, we're well-capitalized, over 250 million at the end of Q2. And frankly, rolling in from phase one, the team has a laser focus now on executing in our phase two trials. I was starting three phase two trials this year in TIC2 alone. We're targeting a proof of mechanism for our CAHPS trial, looking at our indications. And so we are capitalizing for the second half of 2024. Now, you know, with these targets that are, you know, number one, address large markets, diseases with high unmet need, and, you know, really of interest to pharma, and not just TIK2, but without exception TIK2, S1, P1, and then RP3. They're really under interest of pharma. So as we move along, we'll look at every and all opportunities that present themselves. We're very thoughtful about them. And those, as you know, include non-dilutive options such as strategic partnerships as and when they come. So we have the luxury of having complete ownership of our compounds. They're all internally discovered. And we'll look at every opportunity to strengthen our capital position in the coming months and quarters. But maybe Marty has something to add to that.
spk08: Sure. Thanks, Raju. Yeah, I would just add, Tiago, we have a great deal of flexibility, obviously, in what we do going forward. The cash balance at $258.4 million in the Q2 actually can get us to meaningful data readouts for RS1P and ulcerative colitis, for our VTS9-5A program psoriasis, potentially for data readouts in psoriatic arthritis and Crohn's, as well as the 2735 CAHPS program. So there's a lot of robustness built into sort of the data readouts we'll see off that capital position. And again, as we're looking to kind of continue to expand that runway so we don't have any delays or you know, hiccups and moving from phase two into phase three over the next couple of years, we'll be looking to sort of bolster that through a combination of different things, including potential for equity financing, potential for strategic partnerships.
spk09: Now, congrats again on the update, and thanks for taking the question.
spk03: Thank you. Our next question comes from the line of Sam Slitsky from LifeSciCap. Your question, please.
spk01: Hey, good afternoon, everyone. Thanks for the questions and congrats on the data. A couple for me. For the IT90 coverage, you mentioned that's consistent across study kinds of interest, being IL-12, IL-23, and interferon-alpha.
spk02: I guess as we interpret data... Sam, you're fading out. Operator, can we...
spk08: Maybe shift to the next one and come back to Sam.
spk03: Certainly. One moment for our next question. And our next question comes from the line of Jeff Jones from Oppenheimer. Your question, please.
spk10: Good afternoon. Thanks for taking the question, guys, and congrats on the data. I guess two questions. Three questions from me. Is your development strategy on 958 impacted at all by whether Ducravacitinib gets a, quote unquote, clean label or not? So does that sort of impact your study designs or otherwise? In terms of the SLE indication, what is sort of, are there gating items in terms of your decisions to move forward? Obviously, three phase twos takes you a long way on 958 even without SLE in the short term and I guess the third question on the S1P program can you give any further clarity around the timeline beyond 2023 or any reason to think first half versus second half or can you provide anything beyond the 2023 thank you
spk14: Yeah, so the label question, lupus and S1P1. So let's just start with Bill.
spk11: Yeah, so I think the label probably doesn't materially impact our thinking. Our belief is that it's certainly possible that there will be a black box warning. We think it's not very likely that there will be a line of use restriction. And as long as that's the case, then it you know, really wouldn't impact our thinking about the design. In terms of S1 lupus, as you saw with the markets in the last slide, the largest markets are psoriasis and inflammatory bowel disease. Psoriatic arthritis is third and lupus is smaller, although that you know, is frankly probably partially a lack of effective therapies, and we could anticipate that to get bigger over time. We have a lot on our plate, and we need to choose some of it before we move on, but we think glucose is a very attractive indication in due course, but that's sort of how it played out. We will plan to update our S1P program sometime, you know, later in the year. What I would say is we're making really good progress now with recruitment.
spk03: Thank you. Great.
spk11: Thank you very much.
spk03: Thank you. And our next question is from Sam Flutsky from LifeSci Capital. Your question, please.
spk01: Can you guys hear me?
spk03: Yes.
spk01: Welcome back. Hi. Yeah, thanks. Two for me. So, for IC90 coverage, you mentioned that it's consistent across cytokines of interest, which are IL-12, 23, and then interferon alpha. As we're interpreting data from others, do you know if IC90 data are always inclusive of each of these cytokines, or is it just sometimes a few of them?
spk14: I think IC90 depends on your, you know, hitting the target starts with IC50, and you can stop at IC90. So, We know from the , from their published data and various papers and so on, what their IL-12 coverage is. And as Bill said, IL-23 has to be deduced because there is no human whole blood assay for IL-23. And the same as for NF-1-alpha, BMS has published their IC-50 and IC-90 on alpha. And for other folks, you know, we've seen NF-1-alpha data perhaps on a poster from Nimbus. But no, the answer is no. You don't blanket cover all of the cytokines with the same potency. Each of them has their own threshold. And we certainly hit IL-23 more potently than we do IL-12. The same goes for alpha. So when we do cover 12, very comfortably also hitting IL-23 and endocrine alpha in the same assays right now. Okay, so that's that. Next one.
spk01: Yeah, and then next question is just general kind of PKPD questions. Is there any data yet with 958 on whether there's a food effect, DDI, QT prolongation, or just anything else notable?
spk14: Yeah, so we don't expect any cardiovascular effects with this molecule thus far, but of course, we'll do a formal study, thorough QT study in the future. There's no hints of any changes right now in any abnormal cardiac function from what we've seen thus far. And we do very careful monitoring in our studies. And then what we're going to do is we're going to disclose our entirety of our PKPD data at a later discussion. It's really not, you know, there's no impact on our phase two strategy. It's going to be a big data dump that we'll do at a meeting and appropriate forum there. But you know what I would like to do is, let's see if there's any more questions. Okay, let's give Jim Kruger an opportunity to weigh in as well. So yeah, next question. So Jim, is there another question in there?
spk03: Yes, absolutely. One moment for our final question. And our final question comes from the line of Edward Nash from Canaccord. Your question, please.
spk04: Hi, this is Xinwei. I'm for Edwards. Thank you for taking our questions and congratulations on the positive data. The first question that I have is still about the dose for the phase two studies that's about to initiate later this year. From your slide just presented, you said the trials will explore a broader range of doses. And based on this phase one data today, see the two 175 and 350 BID doses seem to be pretty good. So could you please share more colors on why you would like to explore a wider range of doses? And I have a couple shorter questions later.
spk11: Well, generally, you'd like to explore some less effective doses as well as what you think the optimal dose or doses are. would be, so that's part of the dose range. We actually are anticipating in psoriasis studying both QD and VID doses, so there will be a range of doses there, which is typical for Phase II trials.
spk04: Okay, thank you. And for the Phase II studies, I guess what are the key parameters that will be monitored both on the target coverage part and also on the general monitor of patient progression?
spk09: Yeah.
spk11: Well, I think that, you know, the path is pretty well trod for psoriasis patients. The PASI-75 is a typical outcome measure. We think with the robustness of our target coverage that we're interested in seeing how we would differentiate on PASI-90 and PASI-100 as well. We plan a sub-study to study the translational medicine aspects in biopsy. That's all pretty standard for psoriatic arthritis. It's the, you know, ACR 20 and 50 and 70 and the typical things. And again, we're very interested in seeing how we might differentiate with the more robust outcome measures. In Crohn's disease, the outcomes are clinical remission and endoscopic improvement and endoscopic remission. And we will be, you know, studying all of those things For instance, you should have the opportunity for biopsies, and that, of course, gives you the opportunity for translational medicine studies as well, and we do emphasize that.
spk04: Thank you. That's very helpful. Very last question from me, I promise. So among the three indications, are there any order of priority from the company? Which one would be the most, I guess, the resources are going to, yeah, the priorities, right?
spk14: Yeah, so good. Thank you. So we've guided folks that will start all three trials in the fourth quarter this year. And we've also guided folks that our first trial will be in psoriasis. And there's no priority amongst one of the others. We're planning to start all three trials and we're capitalized to do so.
spk11: So stay tuned. As a father, I'm going to say I love all my kids the same.
spk04: Thank you. Yeah. Yeah.
spk14: Thank you. So, you know, we've got, of course, our IBD experts here in-house, Bill Sanborn, but I'm going to invite Jim Kruger, who is a KOL in the dermatology space. And maybe, Jim, could you give your thoughts on a phase one data that you just had a chance to see and put the data in context of, you know, you work with a lot of drugs, you work with biologics and certainly with small molecules. So I'll Maybe a quick comment on this?
spk12: Sure, sure. So, I mean, I think what we've seen here are perfectly sensible, maybe even predictable outcomes based on what we've done.
spk14: Jim, we're losing your audio, so you may want to start.
spk12: And the selectivity, maybe I'll just speak up a little bit. I'm not quite sure how I can increase the mic volume. I'll just sit close to the computer. So, very, very encouraging.
spk14: It's still not coming through.
spk12: I really don't know what to do other than scream. I just say it's fascinating data that are No, no, no.
spk13: Take your time. Just relax. Technical stuff happens.
spk12: Okay. I don't think it's at my end. I hope not. I think that
spk14: No, it's not. You know what? You're not coming through. So I did hear you say it's fascinating data. We're very excited by it. Yeah. And, you know, we'll get – okay, you know what? I'll always believe in second chances. Maybe I'll just give you one more chance here. So try again.
spk12: Okay. I don't know if you can hear me. Am I coming through?
spk14: Yes.
spk12: Okay. So, as I say, I think that the data portends very well for what's going to happen. in psoriasis and they make a lot of sense.
spk14: They make maybe more sense than some other small molecule studies that I've seen. No, no, not working. So let's stop now. And, you know, there'll be ample opportunities for folks to interact with Jim.
spk08: So again, Marty, you want to sum up here? No, I'm just thanking everyone for joining us today. Obviously, Raju and Bill did all the heavy lifting here. Thank you so much. And Jim, thanks for joining us as well. Appreciate it. And we're available to follow up with your questions post-call. Thank you. Yeah. Thank you. All right.
spk03: Thank you. Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.
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