4D Molecular Therapeutics, Inc. (FDMT) Earnings Call Transcript & Summary

Good morning, everyone. I appreciate the time to share with you an overview of 4D Molecular Therapeutics. So we'll walk through today how 4DMT, we believe, is well positioned to redefine genetic medicines for millions of patients worldwide. I remind you here, we may be making forward-looking statements. So at 4DMT, our goal is to redefine genetic medicines by developing durable disease targeted therapeutics for large market diseases. Our lead product, which we'll spend most of the time discussing today is 4D-150. 4D-150 is a Phase III asset currently being studied in Phase III for wet AMD. And I'll share more around our development plans, notably our plans to initiate a trial later this year for diabetic macular edema. This slide recaps our development program. As I just mentioned, our focus right now is very clear. Our primary focus is on 4D-150 and as the slide suggests, we are in Phase III for wet AMD. And then later slides, I'll provide an update as to where we are with that development program. But suffice it to say, it's progressed very nicely. We're thrilled with the progress we've made on our AMD pivotal trial. We'll share today as well a little bit of data on our Phase II results from diabetic macular edema, which we're planning to initiate a Phase III trial on later this year. So 4D-150 our retina program is our primary focus, but I will note that we do have assets under development in pulmonology, and that will be 4D-710 and 4D-725. Both of those our assets are fully funded from a development perspective from -- with support from the CF Foundation and a grant from CIRM as well for 4D-725. So when we think about gene therapy and our approach to gene therapy, we like to think about it from the sense of being not as traditional as what most people think about when gene therapy comes to mind. So this slide is meant to illustrate what often is the goal for a lot of gene therapies that you're likely familiar with. But our approach is to look to develop gene therapies that have the potential for broad commercial adoption. Notably, we are focused on large market diseases that have sustainable market commercial markets. Retina is certainly at the top of the list for that. When we think about delivery, we look to develop simple delivery mechanisms and through that, deliver best in place class safety. It's also important we think about our development program to ensure that it's aligned with the regulatory environment, and that's not just the U.S. but in Europe as well. And as we'll cover 4D-150, our Phase III program is a global program with designs that we believe is supportive of filing and [ granting ] approval for both -- approval in the U.S. as well as ex U.S. as well. And very importantly, certainly from a commercial perspective, our manufacturing allows us to present an asset that has a low cost of goods. And that certainly has implications when you think about access and pricing, notably if you're going after large market opportunities. 4D-150 is designed as a backbone therapy, and we believe it has the potential to provide safe and continuous disease control with lifelong anti-VEGF expression. The core to 4D-150 is the R100 capsid. The R100 capsid was developed in-house using our own proprietary platform, and we believe it allows for one robust delivery to multiple retinal layers and because of that, it also allows us to deliver a lower dose and reduce the inflammatory potential of the asset. The payload is aflibercept, which if you're familiar with the retina space, it's branded as EYLEA. So a very common payload has been administered in over 64 million doses worldwide since launch. And it also has a VEGF-C RNAi inhibitor and what we know from that is that actually in our preclinical model shows that it enhances the expression of aflibercept as well. So this -- the science allows us to develop a target product profile that we believe allows for a simple and convenient in-office IVT administration, a predictable and prophylactic steroid eye taper and the potential, as I mentioned earlier, for lifelong durability. So our goal is to simply transform the standard of care. We think 4D-150, our lead asset has the potential to transform the standard of care for large-market retinal vascular diseases with a safe in-office and durable lifelong backbone therapy. To break this out a little bit further, the three sub goals related to that is, one, as I alluded to, we will provide continuous disease control enabled by durable retinal expression of aflibercept, our global Phase III program is underway for wet AMD, and we think our durability profile allows for paradigm-shifting treatment and the potential for lifelong disease control and vision preservation. So the current space today is characterized by this slide, where, first of all, the standard of care is bolus anti-VEGF injections. These anti-VEGF therapies are highly efficacious and you're likely familiar with many of them from VABYSMO to EYLEA and the space has been established for many years. The challenge, however, is that these therapies are delivered in a bolus format of different frequencies based upon the need of the patient. What we see is that pretty much most patients upon initiation of therapy game a significant amount of vision as this chart illustrates. However, due to the long-term treatment burden, what you find is that, unfortunately, despite these therapies being highly efficacious, many of these patients lose vision over time, and this has been shown in real-world data time and time again. And unfortunately, up to 40% of patients actually discontinued therapy within one year despite having gained that vision. So what if you could deliver anti-VEGF suppression through a continuous backbone therapy that significantly reduce that need for bolus supplementation. We think 4D-150 has the potential to do that. And we think that has immense value, certainly, as you can appreciate from a patient's perspective to have a therapy that's continuously there and providing that potential to hold on to that vision long term. But we think that value also is very powerful, both from a provider and a payer perspective. When we look at the feedback from the retina community, ASRS or the American Society of Retina Specialists conducts a survey with their members every year. I think every year for the last 10 years, the #1 unmet need that continues to come up in that survey is a need for sustained expression. So as this slide illustrates, 92% to 94% respondents continue to say sustained efficacy or increased durability continues to be the #1 unmet need. And that is despite there being incremental advances in durability from new therapeutics that have been developed. And speaking of which, if you look at the evolution of the space, the LUCENTIS really was the first branded anti-VEGF dosed approximately on-label monthly. EYLEA was launched certainly thereafter and EYLEA's benefit was about a 14-day increment. So what was a Q4 label for LUCENTIS was a Q8 label for EYLEA but in the real world, it's about an extra two weeks of durability. Despite that incremental benefit and durability, as many of you likely are aware, EYLEA became a very significant commercial success, $3.3 billion in sales in the U.S., about 3 years post launch. And then more recently, about a couple of years ago, the VABYSMO launch, and again, a highly efficacious but a bolus therapeutic as well. The benefit of VABYSMO was about another two weeks of durability compared to what the space was seeing from EYLEA. And with that increment again of durability of a couple of weeks, VABYSMO became a blockbuster. I think, within its first year of sales and about $4.5 billion of sales. 3 years post launch as well. And referencing back to the ASRS path survey, so the same survey that I showed a couple of slides ago, another question that was asked at the respondents was which pipeline treatment for wet AMD excites you the most. And again, remembering that durability and sustained efficacy continues to be the unmet need. The #1 thing in development by far was gene therapy, where nearly 50% of respondents selected gene therapy is the most exciting potential therapy that was in development. And by contrast, at TKIs is about 17%, 18%, so 3x more excitement. So with that in mind, when you appreciate the incremental development of the space, the value that increments have generated in terms of commercial potential and you still look at the unmet need as evidenced by feedback from physicians. We believe a 4D-150 profile with the potential to be paradigm shifting. And again, our goal is not to add an extra couple of weeks of durability. If you think our durability gain can be measured in months or years for some patients. So that paradigm shift in treatment durability that paradigm shift in treatment burden reduction, we think has massive potential both from a commercial perspective, but also from the perspective of fulfilling unmet needs from a provider and a patient and likely a payer as well. Of course, all of the efficacy in this space doesn't stand a chance of actually creating value if safety is not supportive. And we've seen this in this space previously, where highly efficacious medicines in the real world have safety challenges and that became a major limiting factor to the commercial success. And that makes perfect sense when you think about it in a space where there's good safe efficacious therapies that are available, safety has to be well established. And I think that's even more important when you look at gene therapy modality. So we're really proud of our Phase II safety data that we've shown so far. As evidenced on this slide, this is our safety data from wet AMD in our Phase I/II trial. And what you see is that out to week 28, there were two cases of mild plus 1 vitreous cells, so a very low rate of IOI. And you get beyond that 6-month window, weeks 28 on up to year 2, actually, some patients are at the 3.5 years. We said no evidence of IOI at all. So we think our safety profile is highly supportive and certainly consistent with what I think physicians would look for in a gene therapy. And that safety data wasn't evidenced just in AMD, that previous slide was in our AMD population. We released last year through a week 60 safety data in DME as well as evidenced on this slide here. And if you recall, some of the safety issues in this space historically actually happened in DME patients. So this is a patient population that physicians are most, I think, 22 in terms of any evidence of IOI and in our Phase I/II data in D&E, we saw no evidence of IOI at all. So again, a very strong consistent safety profile through both AMD and DNB patient populations through Phase I/II. So the next couple of slides, I'll share with you some of the efficacy data that we've seen through our Phase I/II development program for AMD and DME. I think it's important first to just ground you on a different patient populations. So in PRISM, our Phase I/II study for AMD, there's really 3 patient populations that we look at our data through the lens of. First of all, we started the Phase I/II in a arguably a hard-to-treat patient population as evidenced on the left-hand side of this screen, this was a study primarily for safety and proof of concept. We had 24 patients and you'll see that these patients as shown in the middle of the screen. In the prior 12 months, we're getting 10.2 injections. So pretty hard to treat severe patient population. Their main CST, despite getting nearly monthly injections in the prior 12 months was still north of [ 400 at 425 ] and the average time on therapy was 3.7 years. So in a few slides, I'll show you what the efficacy data looked like for that patient population, but we'll also show what it looked like for a patient population that was less severe. So a broader population and a subset of that broad population that was recently diagnosed. So this is the treatment burden reduction for that Phase I/IIa severe recalcitrant patient population. If you recall, they were getting 10.2 injections in the prior year before 40, 150. And we have data on this population that goes out to 2 years. So if you take that prior 10.2 in the prior year, and you said let's double that, assuming that they would have continued on that treatment frequency for 2 years. They were on pace to get nearly 20 injections in a 2-year period. After 4D-150, you see the results here. The treatment burden reduction was reduced by nearly 80%. So 20.4% became an average of 4.3%. And what we think is really interesting about this data as well as if you look at the treatment burden reduction across 6-month increments, you see incredible consistency where the supplemental rate of retreatment in the first 6 months, it was 0.5 because these patients got a couple of doses of aflibercept upfront to load them. But beyond that, the supplemental rate of injections was just over one out to two years. So a significant reduction in treatment burden. Again, keep in mind, these patients were on pace to get 20 injections in the real world. So to reduce that by 80% in a hard-to-treat population, we think, is quite significant. And also key to point out that visual acuity in these patients remain stable and equivalent to aflibercept through the 2-year period. Similarly, retinal anatomy was stable with fewer fluctuations in the OCT versus aflibercept and there was no meaningful signs of information. As I mentioned earlier, so we then looked at the data from a broader population. If you look at the Phase IIb, we've shared data so far to 1.5 years in that population. This group did not have a prior history of aflibercept, so we couldn't compare it to the rate of treatment prior to going on 4D-150. However, we could compare it to what these patients would have received if you were getting treated with EYLEA on-label. So over a 1.5 years period, that would have accreted to 9 injections. And we saw that out of 1.5 years in 4D-150, the average rate of supplemental injections was less than one, representing a 92% reduction in treatment burden. Again, visual acuity was stable through that time period. And retinal anatomy also stable but with a few fluctuations. If you look at this data, it's the same data shown in the last slide, but we broke it out to also show how what portion of those patients were treatment or injection free and what was the split out of supplemental injections which you see on the right-hand side of the screen here. So again, with a 92% treatment burden reduction, 73% of those patients out to 1.5 years where injection fees will require no more supplementation. And we expect to share the 2-year results of that patient population in the middle of this year in a few months. If you look at our DME data, this is our SPECTRA data that we shared last year as well. We shared data out to 60 weeks. And we saw in that patient population that a treatment burden reduction of about 78%. Also, this patient population didn't have prior history of treatment, so we can -- we're comparing that to what a projected aflibercept on-label rate of treatment would be. So a similar rate of treatment burden reduction after 60 weeks and a 44% treatment or injection-free result. And again, we expect to see our year two results in that patient population later this year. So just to recap, we believe our program is heavily derisked, which it has informed our global regulatory plan. Our continued strong Phase I, I and IIb results in a broad patient population to support that. In a few moments, I'll reiterate the trial designs for Phase III, but we are in Phase III with a global design or global regulatory program with the industry standard non-inferiority Phase III program. We believe in our Phase III program, we've also optimized the patient population for Phase III success. And we do have global regulatory alignment with the FDA with RMAT designation and prime designation with EMA. As I've alluded to, 4FRONT-1 is our first of two Phase III programs for wet AMD. We are pleased to announce a couple of weeks ago that we have financed enrollment as of the ninth of February in 4FRONT-1. That has significantly outpaced our internal expectations I think initially, we were guiding to about 1.5 years of enrollment completion in finishing it in February or just a few weeks ago, represented less than a 12-month enrollment period on our first Phase III. That includes, by the way, a patient number of north of 500. So it's higher than what we initially projected. The importance of that, of course, is we think it represents a good proxy for what the true demand and unmet need is in this patient population. So if you think about this, a naive patient population and a gene therapy and we've been able to enroll that in less than 12 months, which we think is quite significant. So 4FRONT-1 is North America. our 4FRONT-2 is underway. That's a global program, so it includes the U.S., Europe and Asia Pacific sites also progressing as per what we projected. So we're thrilled with the progress in 4FRONT-2. We expect results in 4FRONT-2. We expect to complete enrollment in the second half of this year. So about 6 months or so following 4FRONT-1. D&E. So as I shared earlier, the DME results for our Phase 2, we believe we have a strong data set that allows us to move forward into Phase III following our Phase I/II results. So we're currently planning an industry standard non-inferiority design for our Phase III program. Going through the process to get alignment with the FDA and EMA. We have alignment already to do a single Phase III trial for DME, and we hope to initiate that in the back half of this year. From a commercial perspective, we look at 3 things that we think are really important to make sure that we capture the potential for commercialization. First is global scalability. So we have in-house and we also have third-party manufacturers. So we think we have the ability to manufacture at scale. As we've shared publicly as well, we have a, I think, a highly favorable cost of goods profile, at least at less than $1,000 per vial, we believe, is our COGS profile. So it provides us with tremendous both flexibility from a pricing standpoint, which we think helps with our global commercialization opportunity. Scaling and building the commercial model in the U.S. is -- can be done very efficiently. Typically, we think about 2,500 U.S. retina specialists as primary targets for a therapy like this which means that a commercial model probably needs less than 100 field representatives. And as was announced last year, we have a partner in Asia Pac with Otsuka, which has Asia Pac rights for 4D-150. We think our value proposition also aligns to what payers are looking for. One of the key things in this space, while it's highly competitive, the important thing from a payer in addition to, of course, a favorable cost profile is being able to show long-term vision protection for patients. Currently, you can treat these patients with bolus therapeutics. They're efficacious for a while, but many of those patients that are -- that can be expensive to the system have lost that division within a year or two, as I showed earlier. The potential to actually show long-term preservation of that vision, we think, is highly important and highly valuable to -- from a payer perspective. In the U.S., in particular, we think our profile fits seamlessly into the buy-and-bill model, which the U.S. retina specialists and their practices have optimized. So we'll fit seamlessly into that. And as I mentioned, we think we have the ability to be flexible in our pricing strategy enabled by our low cost of goods. The last part of our commercial value proposition comes down to how do we think we fit into a practice environment again, current retina clinics in the U.S., highly efficiently perfected the buy-and-bill model. So our goal is to seamlessly integrate into that. So the fact that it's intravitreal administration which is the same as what they do today for current therapies. They can be administered in the office, we think our stability and refrigeration and so on is conducive to basically replicate what the current distribution in process would look like for -- with existing therapies. So seamless integration within the U.S. retina clinics. Just a recap of key catalysts that you can expect as we go through 2026. As I mentioned a few slides ago, we have completed enrollment in 4FRONT-1. Middle of this year, we expect to share our 2-year data on PRISM, our wet AMD Phase II study. We expect to share an update on enrollment in 4FRONT-2 later this year in the back half. And then in the first half of 2027, we expect to share top line Phase III data on 4FRONT-1, followed by top line data on 4FRONT-2 in the second half. And as mentioned, in diabetic macular edema, finalizing our global Phase III design in the middle of this year, hoping to initiate the global Phase III in Q3 and sharing our 2-year SPECTRA Phase II results in the back half of this year as well. And currently, we sit with about just over $500 million in cash at the end of 2025, which gives us runway, we believe, to go into the second half of 2028. So I'll end where I started. We believe we have a very compelling product profile. We think we are well positioned with 4D-150 to transform the standard of care for a large market retinal vascular diseases. With a safe in-office and durable, lifelong backbone therapy. So with that, I thank you for your attention.