Alpine Immune Sciences - Q4 2023

Transcript

Operator (participant)

Ladies and gentlemen, welcome to the Alpine Immune Sciences Fourth Quarter 2023 and Full-year Earnings Call. Currently, all participants are in a listen-only mode. As a reminder, this event is being recorded, and I would now like to introduce Temre Johnson, Senior Director of Investor Relations and Corporate Communications at Alpine. Ms. Johnson, please go ahead.

Temre Johnson (Senior Director of Investor Relations and Corporate Communications)

Thank you, Abby. Good afternoon, and thank you to everyone for taking the time to join us today. With me on today's call from Alpine are Dr. Mitchell Gold, Executive Chairman and Chief Executive Officer, Dr. Stanford Peng, President and Head of R&D, Paul Rickey, Chief Financial Officer, and Dr. Remy Durand, Chief Business Officer. Before I turn the call over to Mitch, I'd like to remind you that we'll be making forward-looking statements during today's call. These forward-looking statements represent our views as of today and are based on our current expectations and consequently involve risk and uncertainties. Actual results could differ materially from those anticipated in such forward-looking statements as a result of such risks and uncertainties. I encourage you to refer to the most recent SEC filings regarding the risk factors associated with these statements. Mitch, please go ahead.

Mitchell H. Gold (Executive Chairman and CEO)

Thank you, Temre, and thank you to all those who are participating in the webcast today. 2023 was a transformational year for Alpine, with initial IgA nephropathy data presented at the American Society of Nephrology's Kidney Week, suggesting a best-in-class profile for povetacicept, our wholly owned, next generation, dual BAFF/APRIL inhibitor with once monthly dosing developed using our directed evolution platform. We are still only in the early stages of exploring the full potential of povetacicept. On the back of strong enthusiasm around ASN, we closed an oversubscribed $150 million equity offering to accelerate multiple development activities. With our encouraging data set in IgAN, convenient once monthly dosing regimen, and strong balance sheet, we are rapidly advancing development of povetacicept as a potentially meaningful new therapy option for patients living with IgAN, lupus, and multiple other autoimmune and inflammatory diseases.

Looking ahead, we are well-positioned for meaningful catalysts in 2024 and beyond. In April, we plan to present additional data on povetacicept and IgA nephropathy, including follow-up data from the 80-milligram monthly and initial data from the IgAN 240-milligram monthly dose cohorts at the World Congress of Nephrology meeting next month. Following these data, in the second half of the year, we plan to initiate RAINIER, pivotal phase 3 study of povetacicept in IgA nephropathy and DENALI, a phase 2 study of povetacicept in SLE. In addition to updates on our clinical studies, we look forward to sharing translational data that further supports the BAFF and APRIL potential of povetacicept in multiple diseases. I now hand the call over to Stanford to review our progress and provide updates on our development plan for povetacicept in more detail. Stanford?

Stanford Peng (President and Head of R&D)

Thank you, Mitch. As Mitch described, the emerging clinical findings with povetacicept continue to inspire us to advance as rapidly as possible. At last year's Kidney Week meeting, we reported the first clinical observations with povetacicept in IGAN, where it was associated with a greater than 50% reduction from baseline in proteinuria at six months, as measured by urinary protein to creatinine ratio or UPCR. In addition, the majority of patients met remission criteria as defined as reduction in UPCR to less than 0.5 grams per gram, at least a 50% reduction in UPCR from baseline, and stable renal function, as assessed by estimated glomerular filtration rate or eGFR. Importantly, these findings were associated with significant reductions in the key IGAN biomarker, Gd-IgA1, supporting the concept of povetacicept as a disease-modifying therapy.

As a reminder, the approvable efficacy target has historically been a 30% reduction in proteinuria at nine months. Our very encouraging findings continue to hold up with additional patients and with longer follow-up. Povetacicept could indeed be a particularly compelling therapeutic option for patients with IgAN and other autoimmune diseases. Therefore, since ASN, we've been making every effort to prepare the program and the company for the next pivotal phase of development. We look forward to the opportunity to provide a formal clinical data update on povetacicept in IgAN next month at the World Congress of Nephrology, which will take place in a late-breaking poster. In the meantime, our primary development goal for povetacicept is its advancement this year to a pivotal trial in IgAN, which we're calling RAINIER. Of course, several other autoimmune and or inflammatory disease indications remain of great potential interest for povetacicept.

First, lupus remains a key indication, second only to IgAN, supported by the clinical validation of the pathway in the disease by BAFF inhibition and wild-type TACI-Ig molecules. We continue to plan to initiate a phase 2 study in lupus, called DENALI, later this year. Second, we continue to explore other renal indications in the RUBY-3 study. At last year's Kidney Week, we described a single patient with primary membranous nephropathy, or pMN, who had achieved an immunologic remission on povetacicept. Such a finding suggests that other autoantibody-related diseases may benefit from povetacicept. Indeed, we continue to enroll additional subjects with pMN, and as a reminder, RUBY-3 is also enrolling lupus nephritis and has just recently opened an ANCA-associated vasculitis cohort. In addition, we continue to explore autoimmune myasthenia in the RUBY-4 study. We look forward to future opportunities to share these collective data.

Finally, ongoing and emerging preclinical and translational data continue to suggest yet additional therapeutic areas like neurology or allergies for povetacicept. Last year at Kidney Week, we observed a significant reduction in IgE in IgAN patients who had received povetacicept, suggesting potential applicability in IgE-related diseases like allergy. We also presented data on povetacicept in a mouse model of myasthenia gravis at the American Association of Neuromuscular and Electrodiagnostic Medicine annual meeting. And next month, we will present data on povetacicept in a mouse model of autoimmune encephalitis at the American Academy of Neurology meeting. In the myasthenia model, povetacicept appeared superior to clinically relevant comparators such as FcRn inhibition or B-cell depletion. We think this may in part be related to some unique biophysical and/or other developmental characteristics of povetacicept, which confer greater tissue penetration and/or distribution than wild-type TACI-Ig.

Data supporting this latter statement will be part of a poster later this week at the European Lupus Meeting. Altogether, these developments only reinforce the potential for povetacicept to have broad clinical impact in multiple serious diseases. As a reminder, povetacicept was discovered in-house by our proprietary directed evolution protein engineering platform, which has been quite productive and continues to generate novel drug candidates that may be of great future interest. We therefore look forward to opportunities to provide further updates, not only on povetacicept, but also on our development pipeline in the near future. I'll now turn the call over to Paul Rickey, our Chief Financial Officer.

Paul Rickey (CFO)

Thank you, Stanford. And now I'll provide a brief overview of our financials for the year ended December 31, 2023. For the year ended 2023, collaboration revenue was $58.9 million, compared to $30.1 million for the same period in 2022. The increase in collaboration revenue relates primarily to a $24.9 million increase in AbbVie revenue, of which $20.4 million is due to a cumulative catch-up adjustment resulting from the completion of enrollment in SYNERGY for the amendment with AbbVie, and a $4.5 million increase in Amgen revenue, driven primarily by the expiration of Amgen's option to select a third research program. These increases were partially offset by a $0.6 million decrease in Adaptimmune revenue, as we completed our final deliverables under the agreement in June 2023.

Research and development expenses for the year ended 2023, inclusive of non-cash expenses, were $80.9 million and $70.2 million for the same period in 2022. The increase of $10.7 million was driven by an $8.2 million increase in povetacicept costs, primarily related to higher clinical, process development, and manufacturing expenses. A $1.3 million increase in acazicolcept costs, due primarily to process development and manufacturing, and a $7.7 million increase in personnel-related costs. General and administrative expenses for the year ended 2023 were $22.2 million, compared to $18 million for the same period in 2022. The increase of $4.3 million was primarily attributable to increases in personnel costs and professional services.

The company recorded net losses of $32.2 million and $57.8 million for the year ended 2023 and 2022, respectively. As of December 31, 2023, Alpine's cash and investments totaled $368.2 million, which we anticipate should be sufficient to fund our planned operations into 2026. I will now hand the call back to Mitch.

Mitchell H. Gold (Executive Chairman and CEO)

Thanks, Paul. As Stanford highlighted, we are highly encouraged by the initial IgAN data for povetacicept and are just beginning to explore the full potential of this unique, potentially best-in-class molecule. We look forward to a catalyst-rich year with data updates in IgAN and other indications, and the planned initiation of RAINIER, our pivotal Phase 3 study in IgAN, and DENALI, our Phase 2 study in SLE. In addition, we continue to evaluate potential for povetacicept in additional indications, and as Stanford mentioned, we continue to invest in our immunology discovery efforts to advance the next generation of programs from our directed evolution platform. With that, I'll turn the call over to the operator for questions.

Operator (participant)

Thank you, Dr. Gold. If you would like to ask a question, please press the star key and the number one. If you press star one a second time, it will remove your line from the queue. To be able to answer as many questions as possible, we ask that you please limit yourself to one question and one follow-up. We will pause for just a moment to compile the Q&A roster. We will take our first question from Tara Bancroft with TD Cowen. Your line is open.

Tara Bancroft (Analyst)

Hi, good afternoon. Thanks for hosting this call. So I have a question on ITP expectations. So first, can you provide some potential conferences that the data might be presented, like how you mentioned for the kidney data, it might be at two different ones during the second half? I know you've leveled it down, but you know, just some granularity around potential venues. And then what level of efficacy you're looking for to potentially start a phase 3 study?

Stanford Peng (President and Head of R&D)

Yeah. So for RUBY-4, I think you... I wouldn't look at it as just ITP. I mean, we have interest in other indications beyond just ITP. So, you know, obviously, you have ITP, we have wAIHA, and we have cold agglutinin disease. And our goal is to be able, as we've mentioned, to be able to present that data in the first half of this year. So we haven't yet determined which conference that's going to be at, but there's a couple that we have our eye on in that time.

Mitchell H. Gold (Executive Chairman and CEO)

You had one other question. Remember what that was again? What level of guys would we want to see in ITP? You know, if you look at- Yeah, if you do, I'll remind you that these are highly refractory patients, so, you know, they're third or fourth line therapy patients. So I think if we saw, you know, a meaningful improvement in platelet counts really like that 20% response rate that would durable, that would be meaningful for us.

Tara Bancroft (Analyst)

Okay, great. Thanks.

Mitchell H. Gold (Executive Chairman and CEO)

Thank you.

Operator (participant)

We will take our next question from Mike Ulz with Morgan Stanley. Your line is open. Mr. Ulz, your line is open. Please check your mute button.

Michael Ulz (Analyst)

Sorry about that. Hey, guys. Thanks for taking the question. Maybe two on IgAN and the update, WCN. Can you maybe give us a sense of how many patients we should expect at the 80- and 240-milligram dose and the level of follow-up? And then maybe secondly, just what's your current thinking about selecting the go-forward dose, and, and what would you need to see at the 240-milligram dose to bring that one forward? Thanks.

Mitchell H. Gold (Executive Chairman and CEO)

Yeah, thanks, Mike. So for WCN, what you should anticipate seeing is, for the first time, we'll get a look at 9-month data at the 80 milligram dose cohort level. Obviously, the 9-month data is really important because that's the endpoint that the regulators use for an accelerated approval. And I'll remind you that the benchmark there historically has been a 30% reduction in UPCR, and at 6 months we were seeing, you know, over a 50% reduction in UPCR. In addition, at WCN, you'll get your first look at the 240 milligram data. We expect that to be a relatively small number of patients thus far, and with limited follow-up, but we will get a first look at 240.

You know, as we look at things now, things would need to look dramatically better with 240 over 80. At 80 milligrams, we're already seeing best-in-class reductions in proteinuria, and if that continues to hold itself up at 9 months, we think we have a great clean path forward at the 80 milligram dose level. But if 240 were to exceed that, that obviously be excellent for the company and for patients themselves.

Michael Ulz (Analyst)

Thanks, very helpful.

Operator (participant)

We will take our next question from Thomas Smith with Leerink Partners. Your line is open.

Thomas Smith (Analyst)

Hey, guys. Good afternoon. Thanks for taking the questions, and looking forward to seeing the data updates at WCN next month. Can you just remind us what your expectations are with respect to the 240 milligram dose relative to the strong 80 milligram dose data that we've already seen out at 3 and 6 months? Should we be looking for deeper or perhaps more rapid reductions in proteinuria at these earlier time points, or are you expecting to see similar reductions with the 240 milligram dose?

Mitchell H. Gold (Executive Chairman and CEO)

Yeah, and I'm sure Sam is gonna want to add on to this, but what I would say initially is I'll remind you that you go back to our healthy volunteer data. At 80 milligrams, we covered APRIL for about, you know, 3 or, you know, 3 weeks, and then we lost coverage even though we covered back through the continuum. So, you know, the 80 milligram data so far continues to look best in class. It's still early at 240 milligrams. It's something that we're gonna continue to track. You'll get a quick peek at it at WCN, and then we'll have, you know, additional files that we can share for 240 throughout, you know, as we move throughout the course of the year. We will also, as we mentioned, have a presence at ERA in May.

We look forward to sharing additional data in an oral presentation at that time in ERA. Sam, I don't know if you want to add on to that at all in terms of dosing at 240. I think you covered it. Anything else, Tom?

Thomas Smith (Analyst)

Got it. That's helpful. Yeah, and then just, in terms of continuing to enroll IgAN patients in RUBY-3 at that 240 milligram dose, is the expectation here that you're gonna keep enrollment open until you can get the, phase 3 RAINIER trial off the ground later this year? Or is there a target enrollment that you're looking for? And I guess, maybe lastly, how much overlap is there between the, RUBY-3 trial sites and the planned, sites for RAINIER?

Mitchell H. Gold (Executive Chairman and CEO)

So what I can tell you is that after we shared the data at ASN at Kidney Week last year, enrollment in the RUBY-3 IgAN cohort has been incredibly robust. In fact, you know, we have exceeded our enrollment expectations at the 240 milligram cohort. So there's been a tremendous amount of investigator interest and a tremendous amount of patient interest participating in the RUBY-3 trial. I think that's a testament to the fact that these patients want disease-modifying treatments that are gonna alter their disease. So, you know, we're pretty excited about that. In terms of the overlap, you know, there will be some overlap there in terms of the sites that are in RUBY-3 and what we're doing for our pivotal RAINIER trial.

But I would also emphasize we're in a really bit of a perfect situation where we expect that both phase 3 studies that are ongoing at IgAN right now will be wrapping up enrollment just as we're launching our phase 3. So we anticipate that we'll be the only phase 3 trial out there enrolling during that timeframe. So that hopefully, that'll make for a fairly robust enrollment timeline for povetacicept in the RAINIER study.

Thomas Smith (Analyst)

Got it. That makes sense. Super helpful. Thank you, guys.

Mitchell H. Gold (Executive Chairman and CEO)

Thanks, Tom.

Operator (participant)

We will take our next question from Gregory Renza with RBC Capital Markets. Your line is open.

Gregory Renza (Analyst)

Hi, congrats on the progress. This is such great support. I have a question on RUBY. Could you remind us of the rationale, and if you have any preclinical evidence that BAFF and APRIL should work synergistically or additively, in this indication, and if they are better than the current standard of care? Thank you.

Mitchell H. Gold (Executive Chairman and CEO)

I'll let Stanford take that. Stanford?

Stanford Peng (President and Head of R&D)

Yeah, there are several published studies demonstrating elevated levels of BAFF and APRIL in these various cytopenias, in many cases correlating with disease activity or severity of the cytopenia. We actually showed in some of our preclinical publications last year that, in some preclinical models, for example, in the New Zealand Black/White lupus model, which includes an autoimmune thrombocytopenia manifestation, that treatment with povetacicept can be beneficial. And similarly have shown that in such models inhibition of both BAFF and APRIL, such as with povetacicept or other dual inhibitors, can be superior to either cytokine alone. So that's why it's actually some of that preclinical data that told us to look at these indications.

Then, of course, there's the general rationale that there's a heavy dependence on B cells. I'd just also remind you, those studies also did compare against some standard of care therapeutics, like B cell depletion, at least in the translational or preclinical models.

Gregory Renza (Analyst)

Got it. Thank you.

Operator (participant)

We will take our next question from Matt Biegler with Oppenheimer. Your line is open.

Matthew Biegler (Analyst)

Okay, management team, good to hear from you. Do you guys plan to provide any analysis on anti-drug antibody development, or ideally lack thereof at WCN? I guess maybe to address some of the nagging questions on immunogenicity. Thanks.

Mitchell H. Gold (Executive Chairman and CEO)

Yeah. You know, we have not seen any clinically significant ADA to date. That's something that obviously we're continuing to monitor, and as we have a more complete data set, we'll share that as we update on what we've developed.

Matthew Biegler (Analyst)

Is it also possible, maybe, you know, with further follow-up, that ostensibly, if the data mature nicely, that we can kind of put that idea to rest?

Mitchell H. Gold (Executive Chairman and CEO)

I think one is, you know, this is different than a lot of other recombinant proteins that are administered subcutaneously, in the sense that the mechanism of the drug actually is almost designed to inhibit ADAs. So in a certain sense, you know, it's something that povetacicept kind of sets itself up well for. But I think if you look at the data that we've seen to date, and you'll see the nine-month data that we present at WCN, you know, we're not seeing anything of clinical significance there coming up.

Matthew Biegler (Analyst)

Great. Looking forward to it. Thanks.

Operator (participant)

We will take our next question from Joe Pantginis with H.C. Wainwright. Your line is open.

Hey, everybody. Thanks for taking the question. Good afternoon. So was curious the extent of the translational data that's also coming up that you alluded to earlier, and then also now that you're gonna be going pivotal, if you could just remind all of us sort of your, capacity to address, the manufacturing needs, for the pivotal programs and early potential commercialization. Thanks a lot.

Mitchell H. Gold (Executive Chairman and CEO)

Thanks, Joe. I'll let Stanford take those and maybe deal with the translational data that we presented later on this week, and then we can talk about manufacturing and clinical supply.

Stanford Peng (President and Head of R&D)

Yeah, we have some data, it's at the European Lupus Meeting later this week that will highlight some of the translational data. Like, expanding on some of the studies we showed at ACR last year, showing the rationale of APRIL and BAFF in lupus, but also, preclinical studies looking at the distribution of the drug in different end organs, demonstrating that povetacicept actually has pretty, quite good penetration and distribution into end organs compared to wild-type TACI, which we think is part of why, the drug, at least preclinically, appears to look better than wild-type TACI.

Mitchell H. Gold (Executive Chairman and CEO)

And then, Joe, just on the manufacturing questions related to the clinical trials, we've, you know, been fortunate that we've had, you know, a very straightforward manufacturing process for povetacicept. And we have a lot of plans to supply that we need to conduct our clinical trials.

Joseph Pantginis (Analyst)

Fantastic. Thanks for the info.

Mitchell H. Gold (Executive Chairman and CEO)

Yeah.

Operator (participant)

And we will take our next question from Robert Driscoll with Wedbush Securities. Your line is open.

Robert Driscoll (Analyst)

Hey, good afternoon, guys, and thanks for taking the question. It may be a little premature at this point, but how are you guys thinking about the ultimate kinda length of treatment in IgAN for povetacicept? I think you've mentioned, you know, nine months is kind of the important endpoint here for regulatory. You know, how long are you looking at RUBY-3 patients for follow-up? Thanks.

Stanford Peng (President and Head of R&D)

Well, I think like most therapies in this pathway, I think we're looking right now at indefinite treatment for at least initial treatment, since we don't know yet what the optimal duration is, and the drugs appear to be quite... So, there's not necessarily a need to limit treatment due to, you know, potential side effects. That being said, of course, we're very interested in the mechanism of the disease-modifying therapy that may induce long-term remission. So perhaps as a subsequent line of investigation, we would then think about exploring different lengths of treatment that may result in long-term, you know, responses or hopefully cure.

Robert Driscoll (Analyst)

Got it. Thanks, guys.

Operator (participant)

We will take our final questions from Andy Chen with Wolfe Research. Your line is open.

Andy Chen (Analyst)

Hey, thank you for taking the question. So regarding RUBY-3 enrollment, can you remind us if enrollment is staggered by indication? So we've seen a few patients in IGAN, we've seen one patient in MN, we haven't seen LN data. Are we gonna see progressively higher n's and newer indications? So are we gonna see more patients in MN, and a few months later, we're gonna see another wave of data in LN and then ANCA-associated vasculitis? Like, how does that work?

Stanford Peng (President and Head of R&D)

Yeah, I mean, it, it wasn't not per protocol, but in the way we operationalized the study, we focused almost exclusively on IgA nephropathy initially, given part of the prior rationale of the pathway in, in that, in that disease. And then I, you know, ANCA has actually only recently been formally added to this study, so that's the only maybe protocol-related restriction and timing. But it was after we saw the encouraging initial data at ASN that we really started pushing on the other indications, and of course, then eventually added ANCA vasculitis to the study. So that's, like I said, not, not so much a protocol-restricted timing, but more operational focus in terms of the different indications.

Mitchell H. Gold (Executive Chairman and CEO)

And just to add to that, you will see a continuous flow of updates coming out of both RUBY-3 and RUBY-4, and I think that's one of the benefits we get out of the basket. Obviously, we'll get longer-term follow-up from IgA at both the 80 and 240 dose levels. But you know, we'll continue to get data in pMN and LN. We'll see the initial ANCA vasculitis data come out. So it will be a trial that continues to support, you know, a robust data flow coming out of those basket studies.

Stanford Peng (President and Head of R&D)

Yeah, just noting, we did enroll at 80 milligrams. It is a multiple ascending dose study, so 80 milligrams were enrolled first. That's why that was the first dataset that we announced last fall. And the 240 is lagging behind that, since it's a, you know, an ascending dose design, and that's per indication.

Andy Chen (Analyst)

Thank you. That's helpful. Thank you.

Operator (participant)

There are no further questions, and so this brings us to the end of our time for questions. Dr. Gold, I'll turn the call back over to you for closing remarks.

Mitchell H. Gold (Executive Chairman and CEO)

Thanks, operator. I'd like to thank everyone that participated in today's call. We look forward to seeing many of you at upcoming investor and medical meetings and providing updates in the months ahead. Thank you again.

Operator (participant)

Ladies and gentlemen, this concludes today's call, and we thank you for your participation. You may now disconnect.