Regulus Therapeutics - Q3 2021

Transcript

Speaker 0

Good afternoon, ladies and gentlemen, and welcome to the Rigolus Therapeutics Inc. Quarter 3 2021 Conference Call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time. As a reminder, this conference call is being recorded.

I would now like to turn the conference over to your host, Ms. Crystal Sada, Chief Financial Officer. You may begin.

Speaker 1

Thanks, operator. Good afternoon, and thank you for joining us to discuss Regulus Therapeutics' 3rd quarter 2021 financial results and corporate highlights. With me on today's call is Jay Hagen, President and Chief Executive Officer and Dennis Dreygen, Chief Scientific Officer. Jay will provide opening remarks and share progress on our ADPKD program, and I will review the financial results before we open the lines for questions. Before we begin, I'd like to remind you that this call will contain forward looking statements concerning Regulus Therapeutics' future expectations, plans, prospects, corporate strategy and performance, which constitute forward looking statements for the purposes of the Safe Harbor provision under the Private Securities Litigation Reform Act of 1995.

Actual results may differ materially from those indicated by these forward looking statements as a result of various important factors, including those discussed in our filings with the SEC. In addition, any forward looking statements represent our views only as of the date of this webcast and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update such statements. I'll now turn the call over

Speaker 2

to Jay. Thanks, Chris. Welcome everyone to our Q3 earnings call and business update. We're pleased to share an update on our ADPKD program and plans for next year. Before we get into more detail on our efforts to address this important unmet medical need, I want to spend a few minutes discussing the landscape.

Autosomal dominant polycystic kidney disease or ADPKD is a genetic kidney disease caused by mutations in either the PKD1 or PKD2 gene and is one of the most common human monogenetic disorders and the leading genetic cause of end stage renal disease. In the United States, there are approximately 160 1,000 patients diagnosed with the disease. However, it's believed to be significantly under diagnosed with closer to 500,000 in the U. S. Alone.

The disease is characterized by slowly progressive bilateral enlargement of the kidneys due to growth and proliferation of fluid filled cysts. Patients with ADPKD experience impacts in quality of life, including pain in their sides and back due to the enlargement. And their prognosis is a progressive loss of renal function leading to kidney failure for the average patient in their 50s or 70s depending on what type of mutation they have. Mutations in the PKD1 gene are the predominant form of the disease, accounting for 85% of the diagnosis, with the remaining 15% due to mutations in the PKD2 gene. Mutations in the PKD1 gene tend to lead to more aggressive disease and renal decline.

Current treatment options for patients are very limited with only one approved product, Tolvaptan. Tolvaptan is a vasopressin antagonist and has safety and tolerability issues that has likely limited its uptake. It has a block box warning for potential fatal liver injury and failure requiring transplant, which requires restricted distribution in ongoing liver monitoring in patients. Due to its mechanism, it also has significant tolerability issues leading to patient discontinuation for those who cannot tolerate the medication, which speaks to both the medical need and the opportunity for improved treatments in this category. That said, sales are estimated to exceed $800,000,000 in 2021 in its 3rd year on the market.

Now turning to our approach to address this important disease. Recall that we are developing an antagonist to miR-seventeen, which has been shown to be up regulated in the disease and directly controls PKD1 and PKD2 expression. In addition to the data generated by our team and that of our collaborators at UT Southwestern, we were excited to read the recent publication out of Professor Samlo's group at Yale in Nature Genetics, where they described in mouse models of the disease the rapid reversal of multiple aspects of the ADPKD phenotype after re expression of both polycystin 1 and polycystin 2, providing further support of targeting miR-seventeen to treat ADPKD. As we disclosed earlier this year, we have been able to demonstrate statistically significant increases in these 2 proteins, polycystin 1 and polycystin 2, through treatment with an antagonist to miR-seventeen in patients with ADPKD. Now, I'd like to update you on our recent progress with our program.

In October, we announced our plans to prioritize the advancement of our next generation compound RGLS-eight thousand four hundred and twenty nine and discontinued development of our 1st generation compound RGLS-four thousand three hundred and twenty six. This prioritization was driven by our business objective of allocating our resources and efforts towards the development of the more promising next generation compound. 8,429 has been shown to have all the favorable properties of the 1st generation compound without the limitations. We are excited by this progression as we believe RGLS-eight thousand four hundred and twenty nine holds greater promise including a superior pharmacologic profile with the absence of the off target CNS effects that we're seeing with RGLS-four thousand three hundred and twenty six in chronic preclinical toxicology studies at the top doses tested. Additionally, RGLS-eight thousand four hundred and twenty nine has shown equal potency to its molecular target, miR-seventeen, in both in vitro and in vivo efficacy studies.

We have also demonstrated additive efficacy in preclinical models when combined with Tolvaptan, an important clinical and commercial consideration. We are scheduled to have a pre IND meeting with FDA for RGLS-eight thousand four hundred and twenty nine in December and are on track for an IND submission and initiation of clinical development in the Q2 of 2022 subject to FDA clearance of the IND. Looking ahead to our planned Phase 1 study, these plans include a single ascending dose study in healthy volunteers to enable a multiple dose escalation study in patients with ADPKD around the dose levels where robust clinical biomarker effects meaning changes in polycystin 1 and polycystin 2 were demonstrated with the 1st generation compound. We anticipate reporting top line biomarker data in the first cohort of RGLS-eight thousand four hundred and twenty nine treated patients in early 2023. Although, we decided to discontinue RGLS-four thousand three hundred and twenty six in favor of the next generation compound A129, the work to date on that compound directly informs development of RGLS-eight thousand four hundred and twenty nine.

On November 4th, at the American Society of Nephrology Kidney Week meeting and yesterday at the Biomarkers for Rare Disease Summit, we presented additional data from the 1st cohort of patients in the Phase Ib clinical trial of RGLS-four thousand three hundred and twenty six, which reinforces our prior updates from earlier this year. In the first cohort, 9 patients were enrolled and received 1 milligram per kilogram of RGLS-four thousand three hundred and twenty six subcutaneously every other week for 4 doses. The mean increase in polycystins 1 and 2 at the end of study compared to baseline levels for all nine patients in the first cohort were 58% 38%, respectively. The trajectory of changes in these biomarkers suggest that with continued dosing, higher levels of polycystin may be attainable. Recall that polycystin levels are depressed in patients with the disease, correlating inversely with disease severity and are believed to be directly linked to the key underlying genetic drivers of the disease.

These data demonstrate further clinical proof of mechanism by showing target engagement in the kidneys through these specifically significant increases in urinary biomarkers PC1 and PC2 validating miR-seventeen as potential target for ADPKD treatment. I'm proud of the work of our team at Regulus and continue to advance our understanding of the role of microRNA in important disease areas, particularly diseases of the kidney. We remain steadfast in our mission to help patients suffering from ADPKD. I'll now turn the call back over to Kris for discussion of our financial results. Kris?

Speaker 1

Thanks, Jay. Turning to our financial results. As of September 30, 2021, our cash and cash equivalents totaled approximately 30 $5,800,000 As previously disclosed, we anticipate our current cash balance is sufficient fund planned operations into the Q4 of 2022. Research and development expenses for the Q3 of 2021 totaled $5,900,000 compared to $4,000,000 in the same period for 2020. These amounts reflect the internal and external costs associated with advancing our preclinical and clinical pipeline.

General and administrative expenses for the Q3 of 2021 totaled $2,500,000 compared to $2,100,000 for the same period in 2020. These amounts reflect personnel related and ongoing general business operating costs. Net loss for the Q3 of 2021 was $8,600,000 compared to a net loss of $1,500,000 for the same period in 2020. Basic and diluted net loss per share for the Q3 of 2021 was $0.10 per share compared to basic and diluted net loss per share of $0.04 per share for the same period in 2020. With that, I will turn the call back over to Jay.

Speaker 2

Thank you, Chris. Operator, we are happy to take questions now. Please open the

Speaker 0

Your first question comes from the line of Brian Chang from Cantor Fitzgerald. Your line is open.

Speaker 3

Hey, guys. Thanks for taking my question. So as you're preparing to file the IND for 8,429 in the second quarter, are there any specific items that you will need to discuss with the FDA next month at the pre IND meeting? And can you also talk about how much of the work that you have done in the past for 4,326 overlap with the filing that you anticipate to do in the Q2?

Speaker 2

So the work that we're wrapping up here for the IND filing includes the long pole in the tent so to speak is receipt of the final reports from the toxicology studies and incorporation into the document. The team is busy at work. And as we disclosed earlier, we had completed the in life portion of the dosing of the toxicology study. So it's just a matter of completion of the analytical work there. And in terms of what we have learned from the first program, we have got a sense obviously of where we see changes in biomarkers, which informs then dose selection here with A129.

And so our proposal with FDA includes moving quickly to dose levels where we have seen those changes in biomarkers, which speeds up development. We won't spend as much time in a sub therapeutic level dosing at much lower levels. And obviously, we have very significant presumed margins based on the lack of any overtoxicity observed in the IND enabling tox studies, which enables those sorts of starting doses. So those are some of the elements that will speed development. Additionally, as we've outlined, our proposal includes going from the single ascending dose into patients with the multiple ascending dose and skipping over MA and E study in healthy volunteers, which further speeds the development of this next generation compound.

And in terms of the so that will all be part of the discussion with FDA in the briefing book, which the team is just wrapping for our meeting in December, includes the proposed starting doses and clinical design supported by the results of the toxicology studies, as well as what we've seen previously in terms of biomarker changes. And so that's the aim of the pre IND meeting. In addition to more typical things like the CMC package and elements like that, Brian.

Speaker 3

Okay. And then on the trial data, so we expect top line from the 1st cohort in early 2023. I'm just curious whether you'll be able to do an interim data cut in the healthy volunteer single dose portion to get a sense of the PKPD profile? And whether and also whether there will be any data between now and your first patient cohort data in 2023?

Speaker 2

Yes. So we will obviously have updates as we progress through the single ascending dose study in healthy volunteers. And when we wrap it, be able to articulate top line results in terms of safety and PK. We are not planning to look for any PD signal because miR-seventeen is not upregulated in healthy volunteers. So we wouldn't expect to see an ability to detect statistically significant increases with a single dose.

So it will just be safety and PK out of the healthy volunteer study.

Speaker 3

Okay. And if I may, just one more on the finance side. On the And also And also on the BD front, what's your latest thoughts on potential partnerships or collaborations near term? Thanks.

Speaker 1

So on the first piece of that, Brian, so the increase in R and D expenses was primarily attributed to the GMP manufacturing campaign that occurred this quarter in support of our upcoming Phase 1. So, that was a kind of a one time expense. So, we anticipate our 2 quarters.

Speaker 2

Yes, think about it as we had 2 programs where we're spending money on the 4,326 clinical work and then the lumpy spend associated with manufacturer of your clinical material for A129. And then with respect to BD, yes, we have ongoing discussions with folks. I think that it certainly appears that with now regulatory clarity on how we are planning to move forward from a programmatic standpoint has fostered renewed interest in the program and we have ongoing discussions on that. I'm not going to guide to if and whether we'll do anything, but our business development group is active.

Speaker 0

Next question comes from the line of Yi Chen from H. C. Wainwright. Your line is open.

Speaker 4

Thank you for taking my question. Since 8429 has a similar potency compared to 4226, should we expect to see a similar percentage level increase in the biomarker polycystine 1 and 2? Or there are some other factors that could affect the biomarker readout? Thank you.

Speaker 2

Yes. So in terms of what we would anticipate potentially seeing, I think the way we think about it Yi is that based on everything we've seen today in like the and this is all in our updated investor deck in the PKD1 Floxx RC model, the kidney of the 8,429 treated animal looks a heck of a lot like the kidney of the 4,326 treated animal, which looks much better, meaning not filled with cysts the way the PBS or control treated animals are. Similarly, in all the in vitro testing in terms of the potency to the target and engagement as well as the PK profile of the molecule. It looks like it behaves very much like A129 behaves very much like 4,326. And when we put it through PanLab screens, it doesn't have any other off target unwanted off target effects that we discovered 4,326 possessed.

And we've shown that as well in our updated investor deck that it has no activity on the AMPA receptor, which was we believe underlying the CNS side effects that were observed. And that's been confirmed in our robust toxicology studies where we have essentially dosed the same amount of compound that would be dosed in a chronic tox study now. So really quite robust for an IND. And so with all those important points that leads us to believe we should have a similar type of activity. Now turning to the Phase 1 study, as we've discussed in the past, higher changes from baseline have been shown to be achievable with lower levels of baseline polycystin, meaning the more severe patients demonstrate higher changes than those with less severe disease.

So there are important nuances to comparing across studies, because patients could be different from one study to the next. So I just want to have that important caveat. But I think if I was to rephrase your question, long term, would we expect to see a similar effect in a robust sample set? I'd say absolutely.

Speaker 4

Does that mean the previous animal model you built for was 43.26 for safety margin is still applicable with 8429?

Speaker 2

The PK profile, the population PK model? Yes. Well, we'd have to confirm that PK data. But based on the PK that we have right now from animals, it does look like it has similar PK. You're welcome.

Speaker 0

I'm showing no further question at this time. I would now like to turn the conference back to Jay Hagan.

Speaker 2

Great. Well, thanks very much for the opportunity to provide this update to you and appreciate your continued support of Regulus. Thank you.

Speaker 0

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation and have a wonderful day. You may all disconnect.