Q2 2024 Longboard Pharmaceuticals Inc Earnings Call
Speaker Change: ♪ ♪ ♪ ♪ ♪ ♪ ♪
Speaker Change: Good afternoon, ladies and gentlemen.
Speaker Change: and welcome to the Longboard Pharmaceutical Earnings Incorporate update call.
Speaker Change: As a reminder, this conference call is being recorded. I would now like to turn the call over to Brandi Roberts, Longboard's Chief Financial Officer. You may begin.
Brandy Roberts: Thank you, and good afternoon, everyone. Welcome to Longboard's conference call and webcast, where we'll be providing a corporate update, including results from our LP659 Single Ascending Dose Study.
Unknown Executive: Before we begin today, I would like to remind everyone that this conference call and webcast will contain forward-looking statements about the company, including, without limitation, statements about the potential of our product candidates, the anticipated timing and design of clinical trials, top-line data, commercial opportunities, and financial guidance. These statements are subject to risks and uncertainties that could cause actual results to differ. Factors that could cause actual results or outcomes to differ materially from those expressed in or implied by such forward-looking statements are discussed in greater detail in our most recent reports filed with the SEC.
Speaker Change: Before we begin today, I would like to remind everyone that this conference call and webcast will contain forward-looking statements about the company, including without limitation of language. Thank you.
Brandy Roberts: Statements about the potential of our product candidates.
Brandy Roberts: The Anticipated Timing and Design of Clinical Trials, Top-Line Data, Commercial Opportunities, and Financial Guidance.
Brandy Roberts: These statements are subject to risks and uncertainties that could cause actual results to differ. Factors that could cause actual results or outcomes to differ materially from those expressed in or implied by such forward-looking statements are discussed in greater detail in our most recent report, Fogged with the SEC.
Brandy Roberts: Please note that these forward-looking statements reflect our opinions only as of the date of this call, and we undertake no obligation to revise or publicly release the results of any revisions to these forward-looking statements in light of new information or future events.
Kevin Lind: With that, I'll hand the call over to Kevin Lind, Longboard's President and CEO . Kevin? Thanks, Brandy. And thank you very much to everyone joining us today during what is a very exciting time for Longboard.
Unknown Executive: I'm extremely proud of what we have accomplished in 2024 across the entire organization and portfolio. I'm going to start off by providing an update on our lead asset, Bexacacerin, a highly selective and specific 5-HT2C receptor agonist, and then hand it over to Dr. Kaye to provide an update on LP659. And then Brandy will give an update on our financials before we open the call for Q&A, or D, and on top of three to four other anti-seizure medications Intrave, Lennox-Gastaut, and a number of other DEE participants.
Kevin Lind: I'm extremely proud of what we have accomplished in 2024 across the entire organization and portfolio.
Speaker Change: I'm going to start off by providing an update on our lead asset, Bexacasarin, a highly selective and specific 5-HT2C receptor agonist.
Speaker Change: and then hand it over to Dr. Kaye to provide an update on LP 659 and then Brandy will give an update on our financials before we open the call for Q&A.
Speaker Change: We kicked off the year with a positive top-line data from our Phase 1b, 2a Pacific study evaluating bexacacerin in developmental and epileptic encephalopathy.
Speaker Change: We were incredibly pleased that Bexacasterin achieved a median reduction of countable motor seizures of approximately 60% in highly refractory participants.
Dr. K: and on top of three to four other anti-seizure medications in Dravet, Lennox-Gastaut, and a number of other DEE participants.
Dr. K: Then in June , we had a very busy month.
Dr. K: First, we shared an interim analysis.
Dr. K: of our Open Label Extension Study of Pacific, demonstrating a sustained response over an approximate six-month period.
Dr. K: with continued favorable safety and tolerability as well as successful titration of all of our placebo participants onto bexacacerin.
Dr. K: Second, we completed our end-of-phase-II meeting, and third, the FDA granted breakthrough therapy designation for seizures associated with DEEs down to the age of two. We are the first and only company to receive this designation for DEEs.
Dr. K: The Pacific Data and Breakthrough Therapy designation have been the most rewarding achievement since the founding of Longboard.
Dr. K: Both of these support our thesis and strengthen what we believe we have been working towards, which is to treat DEEs broadly and provide more equitable access to patients that are tremendously underserved.
Dr. K: We have been overwhelmed by the outpouring of excitement and support from caregivers, advocates, and physicians.
Dr. K: We're committed to making a difference for those living with DEEs.
Dr. K: To that end, we are moving forward with our innovative design to study all DEEs in our Global Phase III program.
Speaker Change: We are so pleased to have the opportunity to collaborate with the FDA with the goal of addressing the tremendous unmet medical need for this population in an optimized manner.
Speaker Change: We're expeditiously preparing to start our Phase III program, which will include two pivotal studies, one for Dravet Syndrome and one DEE study that will include Lennox-Gastaut and all the other DEEs.
Unknown Executive: We intend to initiate our Phase 3 program in the second half of this year, and we'll provide additional details on the studies at an upcoming investor and analyst day on September 6th. We have been doing a lot of translational work here.
Speaker Change: We intend to initiate our Phase 3 program in the second half of this year and will provide additional details on the studies as an upcoming investor and analyst day on September 16th.
Speaker Change: With that, I'd like to switch over to our second clinical stage asset, LP659, a highly selective S1P1-5 receptor modulator.
Speaker Change: LP659 was created and optimized by ARENA's world-class GPCR research team.
Speaker Change: The same team that discovered Atrazimod. LP659 was designed to be a centrally acting S1P receptor modulator with some of the same differentiating characteristics built into Atrazimod.
Speaker Change: S1P receptor modulators are considered well understood and early data has been shown to be generally predictive of clinical effectiveness.
Kevin: That, coupled with additional learnings from the I&I space, has opened up several orphaned CNS indications that we think could be very interesting and have attractive commercial opportunities. LP659 has high oral bioavailability, meaning it is effectively absorbed when taken orally, and it directly impacts the CNS glial cell S1P receptor. It has shown promising results in preclinical models for various conditions. However, based on advancements in our understanding of S1Ps, we believe that LP659's unique properties provide it with the potential to be a best-in-class, CMS-focused S1P addressing a range of orphan neurological disorders. With that, I'll turn it over to Randall. Good afternoon, and thanks, Kevin. Today I'll be presenting on LP 659.
Speaker Change: We have been doing a lot of translational work here that, coupled with additional learnings from the I&I space, has opened up several orphaned CNS indications that we think could be very interesting and have attractive commercial opportunities.
Speaker Change: LP659 works centrally to modulate S1P receptors, which play a crucial role in the immune and nervous systems. It exhibits a rapid onset and offset of action, making it potentially more effective and manageable in clinical settings.
Speaker Change: Its high selectivity to S1P1 and S1P5 receptors minimizes off-target effects, enhancing its therapeutic profile, and preclinical studies have shown no significant impact on S1P2 and S1P3, indicating a targeted approach.
Speaker Change: LP659 has high oral bioavailability, meaning it is effectively absorbed when taken orally and it directly impacts CNS glial cell S1P receptors. It has shown promising results in preclinical models for various conditions.
Speaker Change: The market for S1P receptor modulators is substantial, with these treatments already generating significant revenue in CNS in applications, primarily in multiple sclerosis.
Speaker Change: In multiple sclerosis mouse models, LP659 demonstrated lymphocyte modulation, suggesting its potential efficacy in similar human conditions.
Speaker Change: However, based on advancements in our understanding of S1Ps, we believe that LP659's unique properties provide it with the potential to be a best-in-class, CNS-focused S1P addressing a range of orphan neurological disorders.
Randall: Good afternoon, and thanks, Kevin. Today, I'll be presenting on LP659, our promising S1P receptor modulator with broad applicability in treating various rare neuro conditions. I'd like to delve into how LP659 functions by selectively modulating S1PR1. So, just as a reminder, S1Ps, and more specifically LP659, work by functionally antagonizing S1PR1. Binding of these agonists to the receptor induces receptor internalization, leading to degradation.
Speaker Change: With that, I'll turn it over to Randall.
Randall: This disrupts the normal egress of lymphocyte subsets from the lymph nodes. Thus, by reducing the migration of lymphocytes, LP659 decreases the release of inflammatory cytokines, thereby minimizing organ and tissue damage. And what's important is LP659 does this while maintaining immune surveillance, ensuring that the body's defense mechanisms still remain intact. In the CNS, S1PR1 is expressed in astrocytes, and its activation has been shown to reduce astrogliosis and support microglial cell function. In oligodendrocytes, S1P5 may play a role in myelination; these effects on the glial cells are expected to reduce neuroinflammation and enhance neuronal survival.
Randall: Good afternoon and thanks, Kevin. Today I'll be presenting on LP659, our promising S1P receptor modulator with broad applicability in treating various rare orphan neuro conditions.
Randall: On the next slide, the selectivity profile of LP659 is directly coupled to its potential to decrease inflammation and enhance neuroprotection in the central nervous system. There are five S1P receptors that are known in humans, with S1P receptors one and five mediating the anti-inflammatory and neuroprotective effects. S1P4 is generally considered to be non-active in the CNS. Importantly, S1P2, and S1P3 have been associated with potential safety liabilities of the class, including vasoconstriction, fibrosis, as well as decreased blood-brain barrier integrity. LP659 is a highly potent agonist of the S1P1 receptor while retaining some activity at S1P5. It does not bind to or activate S1P2 or S1P3, and it has little activity.
Randall: I'd like to delve into how LP659 functions by selectively modulating S1PR1.
Randall: So LP659's potency at S1P1 internalization positions it as a pioneering treatment with significant potential for managing CNS-related and autoimmune disease. On the next slide, LP659 reduces circulating T and B cells without effect on natural killer cells and monocytes. So thus, this is what's maintaining the immunosurveillance. Those alternative cells are responsible for combating infection.
Randall: So, just as a reminder, S1Ps, and more specifically, LP659, work by functionally antagonizing S1PR1.
Randall: Binding of these agonists to the receptor induces receptor internalization and degradation.
Randall: This disrupts the normal egress of lymphocyte subsets.
Speaker Change: from the lymph nodes. So, by reducing the migration of lymphocytes, LP659 decreases the release of inflammatory cytokines, thereby minimizing organ and tissue damage.
Speaker Change: And what's important is LP659 does this while maintaining immune surveillance.
Speaker Change: ensuring that the body's defense mechanisms still remain intact.
Speaker Change: In the CNS, S1P receptor 1 is expressed in astrocytes.
Speaker Change: and its activation has been shown to reduce astrogliosis and support microglial cell function.
Speaker Change: In oligodendrocytes, S1P5 may play a role in myelination. These effects on the glial cells are expected to reduce neuroinflammation and enhance neuronal survival.
Speaker Change: On the next slide, the selectivity profile of LP659 is directly coupled to its potential to decrease inflammation and enhance...
Speaker Change: Neuroprotection in the Central Nervous System. There are five S1P receptors that are known in humans, with the S1P receptors 1 and 5 mediating the anti-inflammatory and neuroprotective effects.
Speaker Change: S1P4 is generally considered...
Speaker Change: to be non-active in the CNS.
Speaker Change: And importantly, S1P2, S1P3 have been associated with potential safety liabilities of the class, and that includes vasoconstriction, fibrosis, as well as decreased blood-brain barrier integrity.
Speaker Change: LP659 is a highly potent agonist of the S1P1 receptor while retaining some activity at S1P5. It does not bind or activate S1P2 or S1P3 and has little activity.
Speaker Change: On the next slide, LP659 was designed to be a next-generation S1P1 receptor agonist to target the CNS-related diseases with greater precision.
Speaker Change: 659 is designed to be the most potent agonist at S1P R1 internalization, and this potency is crucial for its therapeutic effect.
Speaker Change: So when tested for its ability to promote...
Speaker Change: Total S1 PR1 internalization mediated by both G-proteins and beta-arrest-in-coupling.
Speaker Change: LP659 emerge as the most potent.
Speaker Change: of all of the approved CNS-focused S1P modulators. So we think of other examples such as Panisimod, Ozanimod, Cipanimod, as well as Fungolimod. So importantly, LP659 preferentially triggers beta-arrestin signaling over G-protein signaling.
Speaker Change: Beta-arrestin signaling causes receptor internalization and functional antagonisms. Therefore, this contributes to the anti-inflammatory effects of the class.
Speaker Change: The G-protein signaling contributes to first-dose bradycardia. This is seen clinically with the less selective S1P receptor modulators.
Speaker Change: And then furthermore, LP659 demonstrated the greatest selectivity for S1PR1 over S1PR5. You're seeing this on the right-hand side of the screen, when tested for activity at beta arrest and signaling alone.
Speaker Change: So LP659's potency at S1P1 internalization positions it as a pioneering treatment with significant potential for managing CNS-related and autoimmune diseases.
Speaker Change: On the next slide, LP659 reduces circulating
Speaker Change: T and B cells.
Speaker Change: Without effect on natural killer cells and monocytes. So thus, this is what's maintaining the immunosurveillance. Those alternative cells are responsible for combating infection.
Randall: This is data that I'm showing you from a preclinical model. This uses EAE rats that are dosed with LP659 for two weeks, and this is compared to vehicle EAE rats. Importantly, LP659 increases the proportion of regulatory T-cells, we'll call them Tregs, over total CD4 cells. Tregs are a class of T-cells that have anti-inflammatory properties.
Speaker Change: This is data that I'm showing you from a preclinical model. This uses the EAE rats that are dosed with LP659 for two weeks, and this is compared to vehicle EAE rats.
Speaker Change: LP659 demonstrates potent in vivo activity. It effectively lowers, as seen on the left-hand side of the screen, T and B cell populations.
Speaker Change: Importantly, Lp659 increases the proportion of the regulatory T-cells, we'll call them Tregs, over total CD4 cells. Tregs are a class of T-cells that have anti-inflammatory properties.
Speaker Change: inflammatory effects, and their function has been found to be beneficial in autoimmune and neurodegenerative disease.
Speaker Change: Now, it's notable, as described before, LP659 does not have...
Speaker Change: Significant effect on natural killer cells on monocytes.
Speaker Change: and this indicates a selective modulation.
Speaker Change: of Immune Cells. So, therefore, in a preclinical model, LP659 promoted market-
Speaker Change: suppression of the CD3 positive T cells, a significant reduction of B cells, and an increase in Treg frequency. These effects are consistent with the mechanism of action of this drug class.
Randall: These effects are consistent with the mechanism of action of this drug class, and these preclinical data confirm that LP659 has an improved in vitro profile while increased selectivity is expected to maintain clinical efficacy. So next, what we're going to discuss is the Phase I SAD trial, as well as its subsequent data. This slide represents the design and key study objectives of the 101 study, a first-in-human clinical trial. It's a phase one single ascending dose. We call these SAD studies and adult healthy volunteers.
Speaker Change: And these preclinical data confirm that LP659 improved in vitro profile, while increased selectivity is expected to maintain clinical efficacy. So next what we're going to discuss is the Phase I SAD trial, as well as its subsequent data.
Speaker Change: This slide represents
Speaker Change: The design and key study objectives of the 101 study, this is a first-in-human clinical trial. It's a phase one, single ascending dose, we call these SAD studies, adult healthy volunteers.
Randall: And just to call your attention to the cohorts, cohorts one and two and four, on day one, they're administered formulation one after an overnight fast, and this is followed by a discharge on day one. And cohort three, on day one, administration of formulation one after an overnight fast. They stay in the clinic, and on day eight, they're administered for, and they have a washout, and they're administered formulation two on. They're administered Formulation 2 following a one-week washout of Formulation 1, and they're subsequently discharged on Day 15.
Speaker Change: And just to call your attention to the cohorts, cohorts one and two and four, on day one they're administered.
Speaker Change: Formulation one after an overnight fast and this is followed by a discharge on on day one and
Speaker Change: In Cohort 3, Day 1, Administration of Formulation 1 after an overnight fasting. They stay in the clinic, and on Day 8, they have a washout, and they're administered Formulation 2
Speaker Change: They're administered Formulation 2 following a one-week washout of Formulation 1, and they're subsequently discharged on Day 15.
Randall: So the key study objectives are to assess the safety and tolerability of a single ascending dose of LP659, to determine the PK profile of LP659 and its metabolites in single ascending doses, and to determine the PD profile of 659 in a single ascending dose. So next, I'm going to give an overview.
Speaker Change: So, the key study objectives are to assess the safety and tolerability of a single ascending dose of LPs.
Speaker Change: 659 to determine the PK profile of LP 659 and its metabolites in single ascending doses and to determine the PD profile of 659 in a single ascending dose.
Randall: We'll focus first on the safety aspects of the Phase 1 study. LP659 was generally safe and well-tolerated by the study participants. All adverse events were of mild severity. Importantly, no treatment-emergent adverse events led to a discontinuation of the study, nor did we observe any serious adverse events during the study period. So the graph that I'm about to show you is going to look at the mean percent change from baseline and absolute lymphocyte counts, and I'll code it as ALC. This is looked at over a 24-hour period.
Speaker Change: So next I'm going to give an overview. We'll focus first on the safety aspects of the Phase 1 study.
Randall: And just to remind you, this is just a single-dose study, not continuous dosing. The different lines that we're presenting here represent varying doses, as well as formulations of LP659, as well as a pooled placebo. It's important to note and reiterate that lymphocyte reduction is an anticipated on-target effect of S1P modulators, and it's indicative of the drug's mechanism of action is functioning as expected. I'll just give you an overview for you of the mean percent changes in the ALCs. We're just gonna highlight it right at hour six, post-dose. That's an important time point to remember.
Speaker Change: Lp659 was generally safe and well-tolerated by the study participants.
Speaker Change: All adverse events were of mild severity. Importantly, no treatment emerging adverse events led to a discontinuation.
Speaker Change: of the study, nor did we observe any serious adverse events during the study period.
Speaker Change: The impact on heart rate was consistently low throughout the study duration and notably there were no instances of first-dose bradycardia, which is often a concern in similar treatments.
Speaker Change: Our ECG assessments showed no abnormalities, including no cases of atrioventricular block. Echocardiograms also were normal, indicating no functional adverse cardiac events.
Speaker Change: Pulmonary function tests including spirometry showed no abnormalities. Ophthalmologic assessments were normal with no adverse event findings reported.
Speaker Change: And we observed no infections among the study populations, highlighting the treatment safety,
Speaker Change: So overall, LP659 demonstrated a very encouraging safety profile. Let's get to the good stuff.
Speaker Change: So, the graph that I'm about to show you is going to look at the mean percent change
Speaker Change: from Baseline, and absolute...
Speaker Change: Lymphocyte counts, and I'll code it as ALC. This is looked at over a 24-hour period. And just to remind you, this is just a single-dose study, not...
Speaker Change: Continuous Dosing. The different lines that we're presenting here represent varying doses, as well as formulations of LP659, as well as a pooled placebo group.
Speaker Change: It's important to note and to reiterate that lymphocyte reduction is an anticipated on target effect of S1P modulators. It's indicative of the drug's mechanism of action is functioning as expected.
Speaker Change: I'll just overview for you the mean percent changes.
Speaker Change: In the ALCs, we're just going to highlight right at hour six, post-dose, that's an important time point, dose A, 3.5% reduction, B, 0.9, dose C, 18.8. And here's where we're starting to see the effect that we're hoping to see.
Randall: Dose A, a 3.5% reduction. Dose B, 0.9%. Dose C, 18.8%.
Randall: And here's where we're starting to see the effect that we're hoping to see, in dose C formulation, 258.9%. In dose D formulation, a decrease of 48%, with a pooled placebo cohort of 4.1%. This data suggests that LP659 has a dose and formulation-dependent effect on reducing ALC, with higher doses showing greater reductions. This reduction in lymphocyte count is a crucial parameter as we evaluate our drug's potential effectiveness as well as its safety profile. Further analyses and studies will continue to assess long-term effects and optimize dosing strategies. So now we get to the point: what does this all mean?
Speaker Change: is in Dose C Formulation 2, 58.9% and Dose D Formulation 1, a decrease of 48% with a pooled placebo cohort of 4.1%.
Speaker Change: This data suggests that LP659 has a dose and formulation-dependent effect on reducing ALC with higher doses showing greater reductions.
Speaker Change: This reduction in lymphocyte count is a crucial parameter as we evaluate our drug's potential effectiveness as well as safety profile. Further analyses and studies will continue to assess the long-term effects in optimizing dosing strategies.
Randall: How do we start to bring this information together, and where do we go from here? What are the opportunities in immune and inflammatory conditions? There's been a lot of innovation in the I&E space since the approval of Zungala Mod and the development of the other approved mods.
Speaker Change: So, now we get to the point, what does this all mean? How do we start to bring this information together and where do we go from here? What are the opportunities in immune and inflammatory conditions?
Speaker Change: There's been...
Speaker Change: A lot of innovation in the I&E space since the approval of
Speaker Change: and the development of the other approved mods.
Unknown Executive: The list of potential indications is continuing to grow. To that end, we have conducted preclinical studies of 659 in three broad areas of interest, autoimmune, neuroinflammation, and proteinopathies. This slide outlines the primary disease areas that 659 could potentially target. Each condition is characterized by its unique pathology and the role of T and or B cells in disease progression.
Speaker Change: The list of potential indications is continuing to grow. To that end, we have conducted preclinical studies of 659 in three broad areas of interest.
Speaker Change: autoimmune, neuroinflammation, and proteinopathies. This slide outlines the primary disease areas that 659 could potentially target. Each condition is characterized by its unique pathology and the role of T and or B cells in disease progression.
Speaker Change: LP659 shows promise in targeting these indications due to its selective action on S1PR1 and its ability to modulate T and B cell behavior, thereby potentially reducing neuroinflammation and promoting better clinical outcomes.
Speaker Change: We continue to believe that the best path forward for LP659 will be in an indication where there's a high medical need, where there is a strong preclinical data set and or clinical support, and whereby clinical studies can be conducted that are practical and that are feasible.
Speaker Change: In order to finalize that decision, we want to see the results of our anticipated Phase 1 MAD Study, which we expect to initiate in the first quarter of 2025. And with that, I'll turn it over to Brandy to review our financials.
Brandy: Thanks, Randall. I'd like to take this opportunity to provide a bit more color on our Q2 results, our cash runway, the scaling of our Phase 3 program, and our strategy for bringing programs forward. We ended the second quarter with approximately $305 million in cash and investments, and this reflects a cash burn of about $19 million for the quarter. Our second quarter expenses were higher than our first quarter expenses due to increased R&D activities, primarily related to Bexicastrin, and a smaller amount for LP-659.
Brandy Roberts: Thanks, Randall. I'd like to take this opportunity to provide a bit more color on our Q2 results, our cash runway, scaling for our Phase 3 program, and our strategy for bringing programs forward.
Brandy Roberts: We ended the second quarter with approximately $305 million in cash and investments. This reflects a cash burn of about $19 million for the quarter.
Brandy Roberts: Our second-quarter expenses were higher than our first-quarter expenses due to increased R&D activities, primarily related to Bexicastrin, and a smaller amount for LP-659. These expenses were in accordance with our internal expectations.
Brandy: These expenses were in accordance with our internal expectations. For Bexacastrin, we continued activities in our Open Label Extension Study, as well as significant activities to prepare for our Phase III program. We expect that our expenses will continue to trend slightly upwards during 2024 as we continue to build out our world-class organization, focus on elucidating the potential best-in-class clinical and commercial characteristics of hexacasterin, and continue to make progress on LP659. That means scaling our team and building out our infrastructure in order to make sure our global phase three program for Bexacasterin enrolls at a pace that's acceptable to our organization, exploring additional clinical and non-clinical studies to differentiate our portfolio, and taking advantage of the opportunity to interact with the DEE community and educate the broader community about the tremendous unmet need for DEE patients, their caregivers, loved ones, and healthcare specialists.
Brandy Roberts: For Bexacasterin, we had continued activities for our Open Label Extension Study, as well as significant activities to prepare for our Phase III program.
Brandy Roberts: We expect that our expenses will continue to trend slightly upwards during 2024 as we continue to build out our world-class organization, focus on elucidating the potential best-in-class clinical and commercial characteristics of Bexicasterin, and continue to make progress on LP659.
Brandy Roberts: That means scaling our team and building out our infrastructure in order to make sure our Global Phase 3 program for Bexacasterin enrolls at a pace that's acceptable to our organization.
Brandy Roberts: Exploring additional clinical and non-clinical studies to differentiate our portfolio, and taking advantage of the opportunity to interact with the DEE community and educate the broader community about the tremendous unmet need for DEE patients, their caregivers, loved ones, and healthcare specialists.
Brandy: We are very excited about the opportunity ahead of us for Bexa Castorin and 659. We take our responsibility for managing resources very seriously. We want every dollar to matter. So when we consider plans for additional studies for either program, we're constantly evaluating the risk-reward and whether we believe that level of spend is the best course of action for the company and our shareholders. Our goal is to continue to build value, and the approximately $305 million in cash and investments that we have as of June 30th, 2024, gives us the ability to execute on our vision into 2027.
Speaker Change: We are very excited about the opportunity ahead of us for BexaCastron and 659.
Speaker Change: We take our responsibility for managing resources very seriously. We want every dollar to matter. So when we consider plans for additional studies for either program, we're constantly evaluating the risk-reward and whether we believe that level of spend is the best course of action for the company and our shareholders.
Speaker Change: Our goal is to continue to build value, and the approximately $305 million in cash and investments that we have as of June 30, 2024, gives us the ability to execute on our vision into 2027.
Speaker Change: This concludes the prepared remarks from this afternoon's call, and I'll now turn the call back to the operator to open the line for Q&A, where I'll be rejoined by Kevin and Randall. Operator?
Operator: At this time, I would like to remind everyone that in order to ask a question, press star then the number 1 on your telephone keypad. We will pause for just a moment to compile the Q&A roster.
Speaker Change: At this time, I would like to remind everyone in order to ask a question, press star then the number 1 in your telephone keypad. We will pause for just a moment to compile the Q&A roster.
Speaker Change: For our first question, Laura Chico with Red Bush, please go ahead.
Laura Chigo: Good afternoon and thanks very much for taking the question. Congratulations on the progress, guys.
Speaker Change: I have one question just with respect to the Bexicastrin Phase 3 efforts and then just one on 659. With respect to the Bexicastrin Pivotal programs, I'm wondering if you could just expand a little bit on the sizing of the respective studies, and just wondering if there are any kind of minimal numbers of certain types of DEs that need to be represented on a patient number basis.
Speaker Change: With respect to 659, thank you, Randall, for all that commentary. Just wondering if you could kind of walk through the decision matrix a little bit in terms of indication selection for next steps. Thanks very much, guys.
Unknown Executive: Yeah, hey, thanks, Laura. I appreciate the questions.
Speaker Change: Yeah, hey, thanks, Laura. Appreciate the questions.
Unknown Executive: On the Phase 3 program for Bexacastrin, we want to make sure we roll it all out at the right time, not piecemeal. And so I look forward to a fulsome disclosure of what we're planning to do around the R&D day that we're scheduling for September 16th. With regard to your second question on the decision matrix, I'm happy to take it.
Speaker Change: On the Phase 3 program for Bexacastro, and we want to make sure we roll it all out at the right time, not piecemeal. And so look forward to a fulsome disclosure of what we're planning to do around the R&D day that we're scheduling for September 16th.
Speaker Change: With regards to your second question on the decision matrix, I'm happy to take it.
Unknown Executive: It's a combination of three things we want to see in the MAD to help us make that final decision, but I think it's a little premature to pick that indication until we see how the drug performs at steady state. And so, while we were hoping to roll out the indication a little bit earlier, and frankly, if you had asked me when we did the IPO when we would have selected that indication, I would have said it would be done by now.
Speaker Change: It's a combination of three things.
Speaker Change: So, and we've been talking about this for a while, it's commercial opportunity. Is this something we can do? Is this something that is attractive? Do we like the risk reward on the commercial side?
Speaker Change: The Competitive Landscape on Clinical Feasibility.
Speaker Change: Can we find patients? Can we enroll the studies? Can we do this in a time-efficient manner, in a cost-efficient manner? And then the last piece is translational science. Can we look at preclinical models, as well as data generated from the other mods, to help us...
Speaker Change: elucidate other indications to go after.
Speaker Change: And the interesting thing is that over time that translational area, the data we can glean from other mods has really expanded the potential indications we could go after because of all the learnings in I&I. And so
Speaker Change: I think when we started talking to folks when we did the IPO, we were kind of triangulating around a couple indications. As we have progressed and learning more about 659, as we have run it through additional preclinical models, as we have done additional literature searches, that lens has really opened wider.
Speaker Change: And so, where we are today is we have a good sense of...
Speaker Change: what we want to see in the MAD to help us make that final decision. But I think it's a little premature to pick that indication until we see how the drug performs that steady state.
Speaker Change: And so, while we were hoping to roll out the indication a little bit earlier, and frankly, if you had asked me when we did the IPO, when would we have...
Unknown Executive: But the really interesting thing is we're continuing to learn a lot about this and expanding our potential indications. So my sense is we'll probably roll it out closer to the end of MAD or after MAD and as we move closer to Phase 2 or our expected Phase 2.
Speaker Change: selected that indication. I would have said it would be done by now. But the really interesting thing is we're continuing to learn a lot about this and expanding our potential indications. So my sense is we'll probably roll it out closer to the end of MAD or after MAD and as we move closer to the phase two or our expected phase two.
Speaker Change: Does that answer your question? Yes, it does. Thanks very much.
Operator: Our next question comes from Joel Beatty with Bird. Please go ahead.
Speaker Change: Our next question comes from Jawaharlal Nehru with Baird. Please go ahead.
Unknown Attendee: Great, congrats on the progress. And thanks for taking the questions. The first one is on Bexacaser.
Jawaharlal Nehru: Great, congrats on the progress and thanks for taking the questions. The first one is on Bexacaser and I think the most common question I've been getting from investors since the breakthrough therapy designation is how large is the EEE opportunity? Are you able to share anything about your market research on that?
Unknown Executive: And I think the most common question I've been getting from investors since the breakthrough therapy designation is, "How large is the EEE opportunity? Are you able to share anything about your market research on that?"
Unknown Executive: Yeah, so we'll talk a little bit more about that in September. I think where we are today, there's a lot still left to learn.
Speaker Change: Yeah, so we'll talk a little bit more about that in September . I think where we are today, there's a lot still left to be to learn.
Unknown Executive: We're trying to make sure we're not double counting by including patients who have a diagnosis of Lennox-Gastaut plus a genetic diagnosis or one of the other DEEs. We're trying to look at patients who will potentially have their indications potentially migrate over the course of their life. But what we will say, what we do feel comfortable with saying, is that we think the market is very big. We're excited about that opportunity to really be able to address a number of DEEs and a number of patients who don't have access to the latest clinical trials and don't have access to the latest standards of care. To us, that is tremendously exciting. More to come on exact numbers, but we think that there's a real opportunity here to do something with that designation and that indication.
Speaker Change: We're trying to make sure we're not double counting by including patients who have a diagnosis for Lennox-Gastaut plus
Speaker Change: a genetic diagnosis or one of the other DEEs. We're trying to look at patients who will have their indication potentially migrate over the course of their life.
Speaker Change: But what we will say, what we do feel comfortable with saying is, we think the market is very big. We're excited about that opportunity to really be able to address a number of.
Speaker Change: DEEs and a number of patients who don't have access to the latest clinical trials and don't have access to the latest standard of care. And to us, that is tremendously exciting.
Speaker Change: So, more to come on exact numbers, but we think that there's a real opportunity here to do something with that designation and that indication.
Unknown Executive: Great, that's helpful. And then a question on 659. On the slides presented today, it looked like there were two formulations tested with quite a large difference between those two formulations. Are you able to share anything about what that formulation is, or at least how much you'll be testing different formulations in the MAD Study?
Speaker Change: Great, that's helpful. And then a question on 659. On the slides presented today it looked like there was two formulations tested with
Speaker Change: Quite a large difference in those two formulations. Are you able to share anything about what that formulation is or at least how much you'll be testing different formulations in the MAD Study?
Unknown Executive: Yeah, a great question. I think in the MAD study, we triangulated on some variation of Formulation 2. The formulations will potentially adjust slightly on the margin, but we think Formulation 2 gets into the plasma much better and has less variability. Obviously, you can see the impact on lymphocytes, and so Formulation 2 is the path forward for the MAD. And I'm going to pass it over to Randall to add something. Yeah, just an important point to add.
Randall: Yeah, hey, great question. I think in the MAD study, we have triangulated on some variation of formulation 2. Formulations will potentially adjust slightly on the margin, but we think formulation 2 gets into the plasma much better and has less variability. Obviously, you can see the impact on lymphocytes, and so formulation 2 is the path forward for the MAD, and I'm going to pass it over to Randall to add something. Yeah, just an important point to add is both the formulations and doses have got us to where we wanted to be.
Randall: In terms of the preliminary findings, the target was to show a reduction
Randall: in apposite lymphocyte count, we were in that 50 to 60% range, that's great from a
Randall: early clinical development standpoint in SAD. So an important thing to keep in mind.
Randall: is in a multiple ascending dose study with multiple doses one would anticipate that that decrease in absolute lymphocyte counts will continue to decrease to get the best benefit of the product. But these are terrific early findings in both formulations.
Speaker Change: Thank you.
Speaker Change: Our next question comes from Gavin Clark-Garnett with Abercrombie. Please go ahead.
Randall: Hey guys, congrats on all the progress and thanks for taking the questions. I'll follow the form of doing one BECSI and one S1P question.
Speaker Change: Hey guys, congrats on all the progress and thanks for taking the questions. I'll follow the form of doing one BECSI and one S1P question.
Gabin Clyde-Garnett: First, just on BECCI, could you just comment on the status of discussions with global regulators on the potential for the broad DEE path since it sounds like you're clearly aligned with the FDA already?
Unknown Executive: Well, we're planning a global phase three program, and we're going to talk about all the details of that in September.
Gabin Clyde-Garnett: Sure. Randall, do you want to take this one? Sure.
Randall: Well, we're planning a Global Phase III program. We're going to talk about all the details about that in September . We have initiated our discussions with global regulatory authorities.
Unknown Executive: We have initiated our discussions with global regulatory authorities. One would anticipate that our breakthrough therapy designation will set precedent in other areas, and as part of our discussions, believe it or not, regulatory authorities do talk with each other across the globe, and they are aware of the breakthrough therapy designation and the reasoning and the thinking behind it. We do share that information, so we would expect that our discussions with other regulatory authorities will go on in a similar positive fashion.
Randall: One would anticipate that our Breakthrough Therapy designation will set precedent in other areas and is part of our discussions.
Speaker Change: Believe it or not, regulatory authorities do talk with each other across the globe and they are aware of the breakthrough therapy designation and the reasoning and the thinking behind it. We do share that information across. So we would expect that our discussions with
Randall: Other regulatory authorities will go in a similar positive fashion.
Speaker Change: Awesome, that makes sense. And on the S1P, I'm just wondering what the half-life of 659 in humans is. And at the one dose where you saw the largest ALC impact, what was the heart rate or the QTC impact there? Thanks guys.
Randall: Yeah, let me pass it to Randall. Yeah, so
Randall: Yeah, let me pass it to Randall.
Randall: So the question on heart rate changes and NALC numbers, we did not see a clinically significant decrease.
Randall: in heart rate in any of the formulations tested. I also made a note that there were no...
Randall: No abnormal EKG findings, so I can't comment on the QTC numbers, because they were all normal. I think you're implying, did we see any QTC prolongation, and we did not.
Randall: Half-life, way better to have that discussion with a multiple ascending dose study. The half-life that you do see is only the half-life after a single dose. They can sometimes, depending on the product, be misleading. I'm not implying that there's a positive or a negative here. I just think, generally, you want to wait until you have a multiple ascending dose before you talk about the typical PK parameters such as half-life, Cmax, Tmax, AUCs, and so forth.
Randall: Half-Life.
Speaker Change: Half-Life
Speaker Change: Way better to have that discussion with the multiple ascending dose study. The half-life that you do see is only the half-life after a single dose.
Speaker Change: Sometimes, depending on the product, can be misleading. I'm not implying that there's a positive or a negative here. I just think generally you want to wait until you have a multiple ascending dose, until you talk about the typical PK parameters such as half-life C-max, T-max, AUCs, and so forth.
Unknown Attendee: Thanks. Congratulations on the progress again.
Speaker Change: Thanks. Congrats on the progress again.
Operator: Our next question comes from Kalpit Patel with Be Riley Securities. Please go ahead.
Speaker Change: Our next question comes from Kalpit Patel with Be Riley Securities. Please go ahead.
Unknown Attendee: Yeah, hey, good afternoon, and congrats on the regulatory alignment. You mentioned that you'll have another DEE component included in the LGS study. I guess if you could comment, you know, before the event next month, how many different DEEs are you aiming to address in that other DEE component?
Kalpit Patel: Yeah, hey, good afternoon and congrats on the regulatory alignment.
Kalpit Patel: You mentioned that you'll have an other DEE component included into the LGS study. I guess if you can comment, you know, before the event next month, how many different DEEs are you aiming to address in that other DEE component?
Unknown Executive: Yeah, hey, great question. I think it's almost the reverse.
Speaker Change: Yeah, hey great question. I think it's almost actually the reverse. The 301 study is going to be a DEE study that includes Lennox-Gastaut.
Speaker Change: And great question, though, but we want to be very clear on that. It truly is a DE study that includes Lennox-Gastaut patients.
Unknown Executive: The 301 study is going to be a DEE study that includes Lennox-Gastaut. And that's a great question, though, but we want to be very clear on that. It truly is a DEE study that includes Lennox-Gastaut patients. We did see a number of DEEs in the Pacific study, and that gives us comfort that we can study the entire DEE population in this 301 study as we move forward. Randall, do you want to add something?
Speaker Change: R&D Day, we did see a number of DEEs in the Pacific study, and that gives us comfort that we can study the entire DEE population in this
Randall: So, we haven't disclosed the individual DEs from the PACIFIC study, but we know there were 19 patients in that study, and when asked before, I said it was a bunch of onesies and twosies. So, if you want to do the math, you could imagine that there is a significant amount of heterogeneity among the different DEs that we observed in the PACIFIC study. We'd expect that to move forward in a much larger study conducted in the DE population, and as I said, stay tuned for September, and we'll go through some more exciting details then.
Speaker Change: So we haven't disclosed the individual DEs from the PACIFIC study.
Speaker Change: Conducted in the DE population. And stay tuned for September and we'll go through some more exciting details then.
Unknown Executive: Okay, and then for the open label extension late breaker data next month, what sort of analysis are we expecting? Is there more follow-up data, or is it the same cutoff data?
Speaker Change: Okay and then for the open label extension late breaker data next month what sort of analysis are we expecting? Is there more follow-up data or is it the same cutoff date as what we're expecting?
Unknown Executive: Yeah, so a lot of the data that will be presented there, much of which we have presented, and that is data for the six-month cutoff. So that will provide the percent reduction in countable motor seizures at that time point, as well as the full safety data set for the cohort that has reached that point. We were pleased to see that it was accepted as an open-label extension study, and it will allow us to have a more in-depth discussion with our potential investigators. The beauty of this is that it's in Europe. It gives us a great opportunity to start to engage with our potential European investigators.
Speaker Change: [inaudible]
Speaker Change: 6-month cutoff, so that will provide the percent.
Speaker Change: reduction in countable motor seizures at that at that time point as well as the full safety data set for the cohort that is that has reached that that point.
Speaker Change: We were pleased to see that it was accepted as an open-label extension study and it'll allow us to have a more in-depth discussion.
Speaker Change: with our potential investigators. The beauty of this is it's in Europe . It gives us a great opportunity to start to engage with our potential European investigators.
Unknown Executive: Great. So with regard to the partial clinical hold, it is still in place, and our plan is to move forward with a complete response to the partial clinical hold that will be coupled with the proposal for the multiple ascending dose study. And so we would anticipate resolving that soon.
Speaker Change: Great, so, um...
Speaker Change: Our plan is to move forward with a complete response to the partial clinical hold that will be coupled with the proposal for the multiple ascending dose study, and so we would anticipate resolving that soon.
Unknown Attendee: Okay, wonderful. Thanks for taking the question.
Speaker Change: David Wang from Citigroup, please go ahead.
Unknown Attendee: Hi there. Thank you for taking my question. So first, I just wanted to ask about, again, the indication selection. I think you had the slide up, you showed quite a number of indications across a few different therapeutic areas. Should we really be thinking about that?
Speaker Change: Hi, there. Thanks for taking my question. So first, I just wanted to ask about, again, the indication selection. I think you had the slide up.
Speaker Change: showed quite a number of indications across a few different therapeutic areas. Should we really be thinking about it as, I guess, you know, selecting just a single indication, or could you think about maybe going after more than one indication?
Speaker Change: And let's say even having the potential to potentially partner and try to access larger indications. And then I had one follow up.
Unknown Executive: I guess, you know, selecting just a single indication? Or could you think about maybe going after more than one indication? And let's say even having the potential to potentially partner and try to access larger markets?
Unknown Executive: Yeah, great question. I think we are waiting to decide how many potential indications we can take into phase two. And so we're going to continue to look at that along the way. The one challenge, to be honest with everyone, is that the patent life on LP 659 is a little bit limited. We have composition of matter to 2031 plus patent term extensions, so it's helping us continue to think about orphan indications as we build out the entire intellectual property portfolio. That doesn't mean we can't go after broader, bigger indications, but we want to make sure we think about it in the right way.
Unknown Attendee: Great, really helpful. And I just wanted to ask quickly about the overall safety profile of the 659 molecule. You talked a lot about cardiac safety and not seeing anything there, but if you think about other physiological systems, ocular and such, how would you say 659 compares to other S1P molecules in the class?
Speaker Change: Popular and such, how would you say 659 compares to other S1P molecules in the class?
Randall: It's Randall.
Randall: It's Randall. Thanks for asking that. I went through that early on. It's the boring part of what I go through when evaluating the safety profile of a drug. In MODS, you do have to actually look more closely, not just at the cardiovascular system, but ocular and macular edema is not an uncommon finding. Impact on pulmonary function is also not uncommon. So this is a single ascending dose study. It's our initial data data set, but we did not see abnormalities in the other organ systems that are typically seen. But there is a big caveat.
Speaker Change: I went through that early on. It's the boring part of what I go through the safety profile of a drug.
Speaker Change: Ocular and macular edema is a not uncommon finding. Impact on pulmonary function is a not uncommon finding.
Randall: It's just a single ascending dose study. We'll continue, obviously, to monitor pulmonary, cardiovascular, and ocular findings, plus what I had mentioned at the very, very end are infections. There's an interesting aspect of the MODS.
Speaker Change: There's an interesting aspect of the mods. You do want to have a lymphocyte reduction, but you want to be kind of selective. You don't want to totally shut down the immune system and immune surveillance. So it's important to follow the potential for infections and opportunistic infections.
Randall: You do want to have lymphocyte reduction, but you want to be kind of selective. You don't want to totally shut down the immune system and immune surveillance. So it's important to monitor the potential for infections and opportunistic infections. We saw no infections in this data set, and we'll continue to monitor for that adverse event as well. Appreciate you asking that question.
Operator: Yatin Suneja from Guggenheim Securities. Please go ahead.
Yatin Suneja: Hey guys, Thank you for taking my question.
Speaker Change: Hey, guys. Thank you for taking my question. Maybe two for me. In terms of the endpoint, if you go for the broader DEE indication, could you talk about how would you harmonize those endpoints across different subsets of DEEs?
Unknown Attendee: Maybe two for me. In terms of the endpoint, if you go for the broader DEE indication, could you talk about how you would harmonize those endpoints across different subsets of DEEs? So that's one. And then the second one on the S1P molecule, is there, I might have missed it, is there a food effect that you are observing? So that's sort of one. And then maybe if you can specify what you want to see in the MAD specifically, that will be helpful.
Speaker Change: So that's one. And then the second one on the S1P molecule, is there a, I might have missed it, is there a food effect that you are observing?
Speaker Change: So, that's sort of fun and then maybe if you can specify that what you want to see in the MAD specifically, that will be helpful. Thank you so much.
Unknown Executive: Sure, do you want to take the first ones? I can do the last one on that, or you can.
Speaker Change: Sure. Do you want to take the first ones? I can do the last one on that or you can.
Unknown Executive: Yeah, so endpoint, again, we'll go through this in a lot more detail in our research call, but the primary endpoint that we utilized in the Pacific study was countable motor seizures. I would anticipate that is the likely endpoint that would be utilized in our subsequent studies. We anticipate that this can be harmonized across the global study because this is an endpoint that has been commonly used with other medications that have been approved in this space. I wouldn't anticipate this being a surprise or something unanticipated. Plus, as you can imagine, we have been having ongoing discussions with regulatory authorities outside the U.S.
Speaker Change: Yeah, so endpoint, again, we'll go through this in a lot more detail in our research call, but the primary endpoint that we utilized in the Pacific study was countable motor seizures.
Speaker Change: I would anticipate that as the likely endpoint that would be utilized in our subsequent studies.
Speaker Change: We anticipate...
Speaker Change: that can be harmonized across the global study because this is an endpoint that has been commonly used.
Randall: We don't analyze food effects in a single ascending dose study. Those are best done as separate studies. And I can't comment today because I don't remember if that would be a component of the multiple ascending dose study, and then what would we do?
Speaker Change: Then on 659, food effect? We don't analyze food effect in a single ascending-dose study. Those are best done as separate studies, and I can't comment today because I don't remember if that would be a component of the multiple ascending-dose study.
Speaker Change: And then what would we like to see in the MAD? Obviously, I think we would like to see continued safety. That's the first and foremost. Obviously, on the cardiovascular side, the other mods have used a combination of dose titration as well as monitoring to avoid cardiovascular risks. A TRAS mod didn't have to do either. Whether or not we'll have that final answer based on the MAD, unknown. Obviously, we will have to keep an eye on that all the way through the development of 659. We're going to want to see lymphocyte reduction over time, and we're going to want to look at that from
Speaker Change: look at, we're obviously incredibly pleased that we were able to see significant lymphocyte reduction in the single ascending dose tends to exceed.
Unknown Executive: Yes, thank you so much.
Yotton: Does that answer your question, Yotton?
Unknown Executive: And thank you for the questions.
Yotton: And thank you for the questions.
Speaker Change: That concludes our Q&A session. I will now turn the conference back over to Mr. Kevin Lead for closing remarks.
Kevin Lead: Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.