ABIVAX Société Anonyme (ABVX) Earnings Call Transcript & Summary

Good afternoon, everyone. Thank you so much for joining us today. My name is Chris Holt, I'm an associate in the Healthcare Investment Banking Group at JPMorgan. I'm very excited to be with you all today. I'd just like to start off by calling your attention to the blue button on your screen, which is where you can submit questions, which we'll handle in the Q&A session at the end. Without further ado, I'd like to hand things over to Dr. Hartmut Ehrlich, CEO and ABIVAX. Doctor?

Thank you, Chris. Good morning, good afternoon, ladies and gentlemen, wherever you are in the world. My name is Hartmut Ehrlich, I'm the CEO of ABIVAX, and happy to be able to introduce our clinical lead molecule ABX464 to you. Just a quick introduction, we didn't even want to spend a slide on this because there's so much to talk about ABX464. But ABIVAX was founded in Paris in December of 2013, so roughly 8 years ago. And we went public exactly 18 months later, raising EUR 57.7 million in what still is the largest IPO in biotech on the Euronext in Paris. Our current market cap is around USD 500 million, and we are fully focused in developing new treatments for chronic inflammatory diseases. And with this, I would like you to move to Slide #3, which just summarizes the main take-home messages that I have for you today on ABX464. The molecule is a potent anti-inflammatory oral drug candidate. It has a first in-class novel mechanism of action, which is centered around the selective upregulation of the physiological anti-inflammatory microRNA miR-124. The safety and efficacy of ABX464 was demonstrated in Phase IIa and Phase IIb induction and maintenance studies in moderate to severe ulcerative colitis patients. And clearly, ABX464 is clinically differentiated from our competitors, especially through the impressive clinical remission rates during maintenance during long-term treatment that we are observing, and I will focus a major part of the presentation on this. Recently, we had FDA end of Phase II feedback and also feedback from the European authorities, EMA, around scientific advice. And taken together, these allow us to finalize the design of our Phase III pivotal global study program in UC. The first patient then is planned for Q2 of this year. In addition to alternative colitis, the disease of -- the area, the space of chronic inflammatory disease, as you know, is very large. And we are essentially ready to go straight into a Phase IIb program in Crohn's disease, the other side of the coin that is called inflammatory bowel diseases here based on similar mechanisms of disease propagation. And we are also ready to move into a Phase III study -- sorry, a Phase IIb study in rheumatoid arthritis based on the encouraging Phase IIa proof of concept data. So in summary, we can say that ABIVAX has not only the potential to treat inflammatory bowel disease, but also more systemic disease, as I mentioned, rheumatoid arthritis and other diseases in the space. Our manufacturing is ready for Phase III. And just to tease you at this point, with the totality of pharmaceutical sales, in ulcerative colitis, Crohn's disease and rheumatoid arthritis in the G7 countries, so U.S., Japan in the 5 largest European countries, which make roughly up 1/3 of the market, but this is the one where, of course, we have the best financial data is -- or was last year, $42 billion. And clearly, we believe that ABX464 has the potential to take a significant market share and become a potential mega blockbuster in inflammatory bowel as well as rheumatoid arthritis. So with this, I'm moving to Slide #4. On the mechanism of action, which, as I mentioned, is first-in-class, which is centered around the potent and specific upregulation of miR-124, a microRNA, an anti-inflammatory microRNA that actually activates the physiological break of inflammation by reducing the expression of inflammatory cytokines and cells to normal levels. MicroRNAs actually work by down-regulating the translation of their respective target genes, some of which are listed here, MCP-1; monocyte chemoattractant protein-1; STAT3, which leads to the down-regulation of other molecules like IL-6, 17 and TNF alpha. The IL-6 receptor is a target leading to further down-regulation of IL-6 and TNF alpha. And STAT3 also is able to actually reduce the amount of TH17 cells in tissues that are expressing this microRNA. I should mention that the process of splicing miR-124 out of this long noncoding RNA is very specific. We looked into this, we couldn't in our systems, identify any other microRNA that we would up or down-regulate. And I should also mention that ABX464 has no impact on the splicing of normal cellular RNA besides this long noncoding species. With this, I would like to go to Slide #5, which shows you the up-regulation in actually patients that are treated with different doses, 25, 50, 100-milligram as part of our Phase IIb study. And if you compare the base line with the readings at day 8 and day 57, you can clearly identify this up-regulation in the blood. And shown on the right side of this slide, also the up-regulation of miR-124 in rectal tissue. So that was important to demonstrate. And after we had shown impressive data in animal experiments on the efficacy of ABX464 to prevent gastrointestinal inflammation, we conducted a Phase IIa study, which was very positive from the results that then led to the conduct of our large-scale Phase IIb study in ABX464, patients with moderate to severe ulcerative colitis. The study was conducted in 15 countries in Europe, plus the U.S., plus Canada, so roughly 130 study sites, 254 patients, who had to be patients with moderate to severe ulcerative colitis, meaning a modified Mayo Score of 5 to 9, 9 is the absolute highest scoring that you can get. And as you see in the table below, these parameters were very well balanced between the patients. We also -- and this was a very important design characteristic, we had central independent and blinded reading of the endoscopies. The endoscopy read has a major impact on the outcome of the modified Mayo Score, and therefore, it is of critical importance that you keep it as unbiased as possible. And finally, the baseline characteristics were well balanced among the treatment groups. And what is of particular importance to show me is 50% of our patients, very quite, the study was stratified for it, to be resistant already to biologics like the anti-TNF-alphas, et cetera, or the first JAK inhibitor tofacitinib. And you can see in the line in the table that among the groups, exactly 50% where indeed resistant to these molecules. But the interesting point is, if you look at what percentage were patients resistant when you look at TNF alpha, and then what percentage of patients were resistant when you look at TNF alpha only, which indicates that these patients are actually multi-resistant as almost all of the patients that were resistant against TNF alpha, also were resistant to other products. This is clearly evidence that we are dealing with a very sick and very severe population of patients. On the right side then sketch of the Phase IIb study design, 4 groups, placebo and 3 active dose groups, 25, 50 and 100, with a 1:1:1:1 randomization. The primary endpoint of the induction study was read after 8 weeks. This is most of the time done in ulcerative colitis. And after a further 8 weeks of treatment or after 16 weeks, patients were actually able then to enroll in the open-label maintenance study that I will spend some time on, as I already mentioned. So Primary endpoint of the study was the mean change from baseline for the modified Mayo Score. And as you can see here, both the group of all patients, but also the subgroup 50% of the patients that were in addition to first-line therapy also refractory to second-line therapy, you can see that the efficacy was confirmed for all patients and also the subset of biorefractory patients, largely with a p-value of smaller than 0.001. On this slide depicted are the secondary -- the key secondary endpoints, endoscopic improvement, clinical remission, clinical response and the mean change from baseline for the biomarker in this disease, which is actually fecal calprotectin, a neutrophil protein that is excreted in the stool. And clearly, for all of these values, we saw efficacy. Most of these numbers, although the study was not powered for statistical significance in the secondary end points, but most of the endpoints also showed efficacy already here. And if you have a look at the data, what is always important is to compare the active doses with placebo. To us, at this point in time, it looks before we go into Phase III, that 50 -- sorry, the 25-milligram is very well positioned for the Phase III study in addition to also the 50 milligram. When we look at how quick are patients responding to this treatment -- and sorry I just got -- I was just informed that I'm blanking on informing you on which slide we are going. We are now on Slide 9. I apologize for that as I'm moving my own machine, not always realizing that you couldn't follow, I'm sorry. But Slide #9 clearly shows the week 4 and week 6 efficacy results. When it comes to the onset of action, and here, we are looking for this data using the partial Mayo Score. There is no endoscopy involved because you cannot do an endoscopy on patients too frequently. So we are just using stool frequency and the number of rectal pleats to look for an improvement of the symptoms. And this is sort of scored in the graph, and you see that compared to placebo, in black; the active doses, in red, green and yellow, actually start to separate from the placebo-treated patients as early as after 1 week, with the data reaching strong statistical significance at a smaller than [indiscernible], so a 0.1 percentage level after 4 weeks of treatment, and that stays on certainly for the next 6 weeks. When we look into maintenance, and this is shown on Slide #10. Out of the 252 patients, 222 completed the induction phase. And out of these 222, 217 enrolled in the open-label maintenance study. And in this study, which is -- was initially scheduled for 1 year, but is continuing now into the second year for the -- at least the first patient, we had -- the first 101 patients of these 217. So roughly about 45% completing their first year of maintenance before September 15 when we did an analysis of the existing data. And what you see here, for all comers, for all patients that moved into the maintenance, we were seeing a clinical remission rate of 58.4% without moving too far ahead because we have a comparator slide in the deck, I just wanted to mention that this is an absolute outstanding result in this space, especially as all patients were in this analysis. By contrast, Phase III studies typically require that you only bring patients in maintenance who have at least a clinical response as readout after induction because these patients have a better prognosis moving through maintenance. And this is indeed confirmed here. If out of these 101, we are just looking at the 63 that had a clinical response or at least a clinical response at the end of introduction. We were at 5% most, so almost 2/3 of the patients. And patients without clinical response, and that also was a surprise to us because that hasn't been shown before. Even without clinical response, 50% of all patients that embarked on maintenance came out with a clinical remission, and clinical remission is essentially the patient is completely free of symptoms and the patient, in addition, has a clean endoscopy. So keep this data in mind, please. I'm going to come back to this in a short time. I told you that, initially, we had a phase IIa study to get into the program. And this IIa study continue to move forward over the years, and the maintenance results are summarized now on Slide #11. So please move your slides. What we were seeing, and this year is an assessment of clinical remission in all patients, so that compares to the 58% that I was showing you for the IIb. Patients in clinical remission in the IIa, patients had a 54.5% rate of clinical remission after the first year. And then, very, very interestingly, and we actually haven't seen any comparable data in the literature for other products. When we extended the maintenance to a second year, still 50% of the patients were in remission and this is all continuous daily treatment after 3 years, 50%. To put this into perspective, I have put down on this slide, and we are on #12, a couple of comparator products. There is on the top sort of the group of products that was licensed between 2005 and 2017, so Humira is on there, tofacitinib, et cetera. And what you see, and I want to specifically focus on the maintenance study, what you see is that typically after 1-year maintenance, and these are the patients as I mentioned before, in Phase III studies, you have -- you only typically enroll patients with a clinical response. At the end of induction, you see remission rates after 1 year, somewhere between 17% and 40% or 44%. If you look into late-stage products, there's clearly etrasimod. You know the company, Arena, was recently acquired by Pfizer for $6.7 billion. The rate in the maintenance study is 33% for upadacitinib, Rinvoq it is, between 42% and 52%. And ABIVAX, as you can see, clearly tops the line in the first study, 66.7%. This is for the patients that had at least a clinical response. And in the IIb study, 63.5%. So this is, for us, an excellent result and really cements the clinical differentiation as we see it due to the fact that we are solving the therapeutic management challenge for these very difficult to treat patients, at least for 2/3 of them. And this, we are now on Slide 13. This is also emphasized on this particular slide, where we are seeing a patient with severe ulcerative colitis, who, in his history had failed, either not responded or stopped response to vedolizumab, infliximab and adalimumab. So ENTYVIO and Humira among them. But the patient did not have the expected response. So the patient was counseled by his treater, which happened to be Prof. Vermeire from Leuven in Belgium, our principal investigator in this study. The patient was counseled for colectomy because this is the ultimate procedure in order to deal with the symptomatology of this very debilitating disease in these patients. And as you know, colectomy is really reserved for the most severe cases because it cuts deep into the quality of life of the patients. So when our clinical trial, the Phase IIa, was first approved in Belgium in November of 2017, Prof. Vermeire enrolled the patient immediately on the study. 2 months later, the patient was then enrolled in the open-label maintenance study. And on the top of the slide, you see the therapeutic outcome. You see on the left, the endoscopy before ABX464 was applied. The typical ulcerative lesions with bleeds around the edges. And if you look and compare this with the endoscopic results after 1 year, after 2 years and after 3 years, then you see that the endoscopy was clean. And I can even tell you that the patients was in clinical remission on all 3 occasions. And Severine commented actually on this during the webcast associated with the top-line data release back in May. And clearly, she said, for this patient, ABX464 was transformative. Now you don't only need an efficient product, you also need a safe product. And the safety is depicted on the next 2 slides. And I can already tell you that the product has been used in more than 1,000 patients by now. In the Phase IIb study, we didn't see any new safety signals, nothing that we knew before, no deaths, no malignancy. The most frequently reported adverse event, as always in our clinical studies with ABX464, was headache, which occurred in 20% of the 25-mg patients compared with 8% in the placebo patients. And the delta, this 12% is typically explained by headaches, which occur early during the treatment within the first 7 or 10 days, which are transient, so a few days, mild or moderate and manageable with or without OTC medications. Other adverse events that occurred in more than 5% of the patients related or not are around gastrointestinal disorders and musculoskeletal disorders. And I can also tell you that there were no clinically significant changes in any laboratory parameter like liver function tests, hemoglobin, white blood cells, et cetera. And you know to what extent such events have been associated with other products. If we look at the treatment emergent adverse events that led to study discontinuation, you just compare placebo with 25 milligrams. And the result is obvious of 25 milligrams. Certainly, no more adverse events than placebo and very similar in the 50 milligrams. SAE, serious adverse events, same picture. Severe grade, so grade 3 and 4 TEAEs, similar between the placebo and the 25-milligram group. And if we look at infections, then the picture that you are seeing here, again, with the 25 milligrams is clearly less prevalent than in the placebo group. So the 25-milligram is clearly standing out with at least a similar safety profile compared to placebo, except for what I mentioned transient headaches. This goes a little bit more, and this is now Slide #15, into details. I mentioned that more than 1,000 subjects have been exposed to ABX464. 143 -- and this is a data cut of late November last year. 143 in 25-milligram and 750 actually in the 50 milligram. And I also wanted to mention that we didn't only do clinical development programs in ulcerative colitis and in rheumatoid arthritis, but also we had a study in COVID-19 patients that we started in April of 2020. And as you can see, in this study, which evaluated 50 milligrams daily treatment for 1 year compared with placebo, there was no imbalance across the groups in terms of incidence of these adverse events, and there was no new safety signal. We just got the integrated safety summary, with a data cutoff end of November of last year. We just got it back. And it's interesting when you are looking at the number of patients with at least 1 adverse event per 100 patient a month. Then if you compare ABX464, the rate is 1.3, and for placebo, the rate is 3.2. So there is clearly no impact on the occurrence of opportunistic infection in patients treated with ABX464. So from this, let me briefly explain how we are moving forward with ABX464 now, the preparation of the Phase III study is on track, as shown on Slide #16. During the last couple of weeks, we got feedback from the end of Phase II meeting with FDA, the EMA scientific advice meeting and also the CMC-focused Type C meeting with FDA. And basically, the outcome of these meetings is that both EMA and FDA agreed with our plans that we want to be progressing the 25-milligram and the 50-milligram dose into confirmatory studies, so in the Phase III studies, both for induction and maintenance in the treatment of ulcerative colitis. And as I mentioned, the authorities consider that appropriate and also support that we no longer go forward with the 100-milligram dose because there's actually no increase in the addition -- or there's no additional observed therapeutic benefit with 50 compared of -- sorry, with the 100 compared over the 50. Also we wanted to let you know that we will be conducting the Phase III program with IQVIA. And of course, with the support of our U.S. and European KOLs, Bill Sandborn from San Diego; Bruce Sands from Mount Sinai, New York, and the key European KOLs, Severine Vermeire from Leuven, who has been with this program from the very beginning and also Herbert Tilg, the Vice President of Research for UEG, the United European Gastroenterology. 2 x 700 patients are planned for the 2 induction studies. And these are the 2 studies that our maintenance study is going to be drawing from. FPI planned for the end of Q2. And just to mention here that we also are running a program, a Phase I program in Japan as agreed with PMDA in order to be able when we start the Phase III to also recruit patients in Japan. With this, I'm going to Slide #17, which I wanted to keep relatively short. But just to let you know the target market, IBD, the G7 market size, I think I mentioned this before, in total, for the 3 diseases is $42 billion at present. The market is going to grow, especially between now and 2027 in ulcerative colitis going up to $10.6 billion from $6.2 billion. In Crohn's disease, going up by about 2% -- sorry, by about 20% to $15.4 billion. And in rheumatoid arthritis, is going -- will be going up over the next 6 years by roughly 10%. Important is with the clinical differentiation that I have been showing you, we believe that ABX464 can capture market share of 10% to 20% at peak sales for both indications. Next slide, I mentioned in the beginning that we also have very interesting initial proof-of-concept data in rheumatoid arthritis. Just to summarize then briefly, I'm sorry, I cannot go into the details. But we did a 3-month induction study in 60 patients, placebo, 50-milligram and 100 milligrams. Baseline characteristics, again, well balanced across groups. Primary endpoint was met with ABX464 as this was a safety study, demonstrating good safety and tolerability profile with the 50-milligram once daily. We did already see a statistically significant difference on the key endpoint, which is the ACR20 in the per protocol population where ABX464 -- which ABX464 reached in 60% of the patients versus 22% in the placebo group. P level smaller, 0.03. Other key efficacy parameters, they are listed here or biological markers already showed favorable differences of the 50-milligram ABX464 over placebo. And the subsequent maintenance study, which we have not yet read out, will be reported by the end of this quarter. So ABIVAX is essentially ready to start the clinical Phase IIb program in rheumatoid arthritis anytime. Just in the last minute, news flow. As I already mentioned, we had FDA feedback. We had EMA feedback top line results of maintenance studies and then for the whole population in UC and RA are going to come towards the end of the quarter. And then, of course, the big event this year is the entrance into Phase III for ulcerative colitis. In addition, in Q2, we are expecting that we will be able to publish the full-length Phase IIb manuscript in UC and IIa manuscript in RA. And with this, hopefully, having shown you that with ABX464, we are addressing a very large medical need. And we think that we have one of, if not the best molecule in the market. And this is in our view, also reflected in the level of interest that we are seeing for ABX464. Thank you very much. Sorry for being lengthy. If you have any questions, I hope we can still be discussing them. Thank you.

Well, thank you so much, Hartmut. I really appreciate you walking us through your deck today. Unfortunately, we are very short on time. So maybe I can just turn things back over to you if you have any final comments before we wrap up for the day. And once again, I just want to thank everybody for joining us today.

No, I just wanted to thank the audience for their attention and wish you all a very nice day. Thank you.