Apellis Pharmaceuticals, Inc. (APLS) Earnings Call Transcript & Summary

Hey, good morning, everyone, and thanks for joining us for the first Annual Immunology and Inflammation Summit here at Stifel. I hope you're all doing well and staying safe. So today, we're going to be assessing some of the hot topics in this therapeutic area. And we're kicking this event off today with our panel on complement-targeted therapies. So with us today for the first panel this morning, we have Dr. Cedric Francois, the CEO of Apellis Pharmaceuticals. And then also, we have Grant Blouse, the Senior Vice President of Translational Research at Catalyst Bio. So gentlemen, thank you so much for joining us this morning.

Thank you.

[ It's great. ]

All right. Well, maybe just to start at a high level here in terms of the evolution of complement-targeted therapies. Maybe I can turn it over to Cedric first and then Grant second in terms of -- I guess, where have we been with complement-targeted therapies? And where are we today? Before we get to where we're going.

Yes. So complement has been pretty elusive for -- or was pretty elusive for a long time until in the last decade, kind of the first real therapeutics started coming about. Actually, already in the 1970s and '80s, they tried to develop small-molecule serum protease inhibitors that had a lot of toxicity issues at the time and weren't really pursued. Then in the 1990s, there were some biologicals that were tried that also were difficult, I mean, large proteins to make. But then obviously, there was one little company, New Haven, that made an antibody that later became eculizumab. And kind of really the first breakthrough in complements was in paroxysmal nocturnal hemoglobinuria. It's important to note that, that breakthrough in PNH came on the heels of a lot of failures in the late 1990s, where the main focus of complement at the time was actually in this ischemia reperfusion injury, and where a lot of money, unfortunately, went to waste on some large studies that failed. But at Alexion at the time recovers really well from that. And the story in PNH, obviously, is a storied one with an inhibitor of complement factor C5, and with an approach that involves an antibody where you really try to eliminate the final step before the membrane of that complex forms. And then in the past 10 years, we've seen kind of a very exciting evolution. I mean, selfishly, I'd like to think about it in kind of 2 different directions. One is in ophthalmology, where complements, we believe, and a lot of people now believe, is associated with the pathology behind age-related macular degeneration. And then on the other hand, in diseases like PNH and several other diseases, where controlling the convertase activity is something that we're all very excited about. So I think we -- there's a lot more to come. And I think in the next 10 years, we're going to see some very exciting developments.

And Grant, just to get your thoughts also in terms of like where we've been. But also looking at some of those other, kind of shifting from C5. Obviously, you guys both are looking at C3, but some of the other things like C2, factor D, factor B, where have we seen some kind of past attempts there to target those in the complements cascade.

Sure. I mean, absolutely. I think that was a really great introduction, Cedric, given the evolution of eculizumab being the first one. And I remember sitting in ASH when that was in Phase III, and everybody was really excited about that on getting to the market and being the first intervention in PNH. It looked like it had a great traction of wording. And true, the complement cascades, like the coagulation cascade, where we work as well. And these are ancient cascades and they're both protease cascades and they kind of run in parallel with a lot of crosstalk. And there's been a lot of academic research on it over the years, starting back in the '60s and '70s, but it didn't get a lot of traction as well. And so this is really starting to kind of all come together. And with the advent of the first inhibitors of C5, people really started to look further at the cascades and where intervention makes sense. And like I said, just like coagulation, they're waterfall cascades. So you kind of start a pie with activators and then they activate another convertase, which activates down further the cascade. Complements then, multiple modes of entry into it, between the classical and the lactate and the alternative pathways, they all converge at C3. And I think that's one of the advantages of targeting C3 as you kind of get it right where all these pathways are converging. But you're still further up in the waterfall cascade than C5. Some of the new targets, going after factor B and factor D or even further up in the cascades, as well as C2 and targets up the C1 on the classical pathway, they offer opportunities where if you get the initiation of the cascade, you can perhaps get better efficacy, but you also have to have a really good control up there as well because just a little bit of leakage, and you'll still have the cascades kind of moving on and amplifying down the way. So I think there's a lot of opportunities coming along. And along with crosstalk with inflammation and coagulation, I think you get kind of a C complement playing a role in a lot more diseases as people look closer at this pathway.

Got it. And then maybe throwing it back to Cedric, I mean, let's talk about C3 first. And again, why you, again, are focused on that one in terms of the approach there. I mean, obviously, you guys are looking at a peptide approach. So you're trying to understand why you think that's advantageous. And then obviously, we can talk about C2, factor D and factor B. But maybe just starting with that one because both of you guys have strong knowledge base there.

Yes. No, thank you, Derek. So look, I mean we -- I wish I had like a sophisticated answer for you. But we were young like you at the time, and we felt like, hey, C3 sits in the middle. May as well shut it all down. But that's a good initial approach. And we in-licensed this class of molecules from the University of Pennsylvania, I'm talking 2004 or '05. And then started working with those and started optimizing them and develop them in the multiple indications where we are currently active. But what we discovered over the years, which I think is really important, behind the mechanism of pegcetacoplan, and quite frankly, the other molecules as well that we are using, is that even though we call them C3 inhibitors, they're not really C3 inhibitors, sticto sensu. And what I mean by that is that pegcetacoplan binds to C3 in a pocket that is essential to C3b as well. And by doing that, you inhibit, on one hand, the formation or the activation of C3 on the cell surface. But then once it's there and it forms convertases, both the C3 and the 2 C5 convertases, you control those as well. And we see our maximum pharmacology actually when there's still 10%, sometimes 20%, of free floating C3 in circulation. And the reason for that -- and I love Grant's analogy with the cascade, right? I mean, if you take, I think of it a little bit more like a river with the cascade at the end, where when you try to inhibit C5, you stand at the bottom of the cascade and you try to catch all the water. And under normal conditions, that can work very well, right. But when you have a rain storm and there's more water coming through, that can become a big problem. And in diseases like PNH, we see that, right, where you can have these breakthrough hemolytic events because there is a rainstorm. What we do is we go upstream on the river and we built not 1 but 3 sequential dams. And each dam is not a complete dam. It lets the water flow through. But if you get 90% inhibition followed by 90% and followed by 90%, that's 99.9%, right? So that is a little bit conceptually what we try to do with this mechanism. And where we believe kind of that favorable profile of safety versus efficacy can be found that we've observed.

Excellent. Grant, do you have anything to add on that?

Yes. I mean, so I think it's a very good analogy for the mechanism going after C3 and kind of shutting it down. I like the idea that you get a big burst of water, it's really hard to control and cover the bucket up at the end if you're going after C5, which is why you might see some failures with some of the anti-C5s in a variety of different therapeutic areas and getting traction with the C3 inhibitors. We take a very similar approach. It's a little different though, obviously. So we're targeting proteases. And of course, proteases, the advantage there is that one protease can take out thousands of targets, if not more. So you can get a very good, extended pharmacodynamic aspect based upon this very small amount of your therapeutic compound in place. And we can go in and then we take down and degrade all of the C3. So we end up cleaving the C3 into 2 inactive fragments. And so you can't have any further functionation activity out of a C3a or a C3b, essentially. So it's a dead protein and then it's unable to go on and do anything else. And so it's a down-regulation too, again, making sure that C3 doesn't have to get activated and go where it needs to go by keeping that suppressed. And then the one advantage with the proteases is that you can knock it down. And then as your PK comes down, you're able to have a long pharmacodynamic effect like that. And that's really what we capture with these protease therapeutics, is this type of idea.

Got it. I guess, what do you think the advantage of targeting C3 versus some of these new molecules coming out targeting factor D and factor B? Some of these are orals. But I guess, what do you think are some of the advantages and maybe some of the challenges, you think, developing therapeutics for those targets might be? Maybe start with Grant and we can go to Cedric after.

Sure. So I mean, I think in principle, the higher you target up on the waterfall, you can be more efficacious. But I think you also have to be more cognizant of your efficacy at that level, too. So if you have a really good regulator up higher around factor D or factor B, it could be efficacious coming down. However, if you're not able to knock down all the activity and you get some leakage, these systems amplify as they go down. And so you're not going to be as effective as coming in and, say, targeting at C3, where you can knock it all down. So it really depends on, I think, the profile of the molecule in these different targets when you're going upstream into factor D and factor B. As well as, I think, various of the therapy areas that are being targeted here, their etiology may be more tied to a specific dysfunctional aspect of the cascade. And therefore, if you target your therapeutic towards the dysfunctional part of the cascade as opposed to like going after C5 at the end, you may have a much more efficacious effect.

Great. And Cedric?

Yes. No, that was a great explanation. I think, look, I mean, first of all, these small molecules are really awesome medicinal efforts. I mean, it's very difficult to control these serum proteases with small molecules, so it's worth commending the companies that are going after that. As Grant explained, you get kind of an exclusive inhibition of the alternative pathway with the possibility for the classical pathway to become activated and not be under control. That, in some conditions, may be okay, in other conditions, not so much, right? I mean, because when you have, for example, an infection and antibodies become active in the system, you can have moments where your pharmacological control is not so good. And if you take a disease like, for example, PNH, it is very important there that you continuously control that activity without kind of lapses along the way. Otherwise, you get breakthrough hemolytic events which are dangerous for patients and something to keep a close eye on. So if you think about PNH, where you are beholden to having to take your pill twice a day, and you can absolutely not forget to take it, right, or bad things will happen to you. And in the meantime, we have to find out of, over the long run, you don't get these breakthrough hemolytic events when there is an infection that happens somewhere. That makes it challenging. But there are other indications, for example, in the kidney, where should it be efficacious, forgetting to take a pill is not such a big deal, probably, right? And where -- I think efficacy-wise, it's -- in my opinion, and I'm sure Grant's as well, always going to be very hard to beat the efficacy of targeting C3. But the convenience factor, of course, with a little bit less efficacy in certain conditions, could be beneficial and helpful to patients. I think there's plenty to be done in the therapeutic world with complements, though.

So I guess, I mean, is it fair to say in terms of like the oral approach, obviously, we're still -- that's still evolving and we're still seeing new data generated. But I guess, because there's such an abundance of protein in some of these indications, I guess, the ability to like almost sop that up, you may require pretty high dosing and pretty frequent dosing. Is that kind of the takeaway that we should kind of get from that kind of approach? Maybe, Grant, you can take that.

Yes. I mean, I think, obviously, the Holy Grail always is thinking of an oral approach that's easy to take. And the more or less frequent you have to do the oral approach and -- on a -- is more attractive. But again, that is, when you're working with these cascades and when you're working from a large protein abundance, you need a lot of molecules to take that out. And by -- kind of by default with small molecules, they can be great. And if you get them specific for their target, they're nice inhibitors. But you do need usually a lot more than 1:1 and maintain a steady level of this. So depending upon the disease that Cedric was pointing at, if you miss a few doses here and there, you might still have inhibition, but at some point, you could drop below that threshold and then kind of the waterfall starts running again. And so those are some of the things that we think about with the small molecule inhibitor approach in the orals. But they are -- the ones out there have shown some nice data so far, particularly vetting those as targets in some of these particular diseases as well.

Got it. And I want to go back to a point you were talking about, Cedric, in terms of different indications and then maybe targeting different areas of the complement cascade. I guess, again, you talked about GA, I mean are there -- and PNH, but are there other indications where this -- targeting certain components may lead to better efficacy? I don't know if we're there yet with the data, but I'd love to kind of get both of your thoughts on where we are in terms of understanding each of these indications at that level and where best to target.

Not that I'm aware of. And of course, I'm not biased at all. But it's -- I think that the place where I think there's some intriguing data that hasn't translated clinically yet is at level of C5, where you can get C5a activation by proteases like thrombin, for example, but at high concentrations. And again, generally speaking, these serum proteases tend to cross-react with each other. And as Grant alluded to earlier, the whole clotting cascade is actually very similar, right? And [ genetically ] very similar to what you have in complement as well. So there's crosstalk between these 2 that's pathologically relevant. Whether that can -- you can take advantage of those points in terms of efficacy, right now, I cannot think of a single place where that is the case compared to controlling convertase activity at the level of C3. And then the other question, obviously, that always comes up is, well, okay, you want efficacy, it cannot be better, how about safety? I mean, is it safe to control C3? I mean, look -- and it's hard to tell, of course, because we are still, relatively speaking, early. But in a disease like PNH, where we control C3 systemically in the whole body chronically over time, we are now nearing probably about 160 to 170 patient years of dosing. That, if you think about that in the context of C5 inhibition, every 100 to 200 patient years, you will see an inflection with meningococcus, so meningitis. We, cross fingers, haven't seen that yet. We've seen a very good profile on the safety side. And that, we believe, may have something to do with the fact that we leave some C3 in circulation, right? So maybe when there's a bacteria that actually comes into the body, there's still some C3 left to control that. But it's too early to tell that. I mean, we'll find that out when we're at probably 500 patient years or more.

Yes. Grant, I don't know if you want to add to that.

Yes. I think those are really good points, Cedric. When you're -- you don't really want to shut it down completely. If you turn the basset off completely, then you run the risk of these infections. And so having some C3 left is probably good, so that it's not completely shut down for a long duration of time, but it has a little bit of activity going on. And then with regards to kind of targeting other parts of the cascade and thinking of safety. If you've got a disease that's related to autoantibodies that are running through the classical pathway, it could be much more attractive to only work on the classical pathway side versus the alternative pathway side. So you leave the alternative pathway open to signal through C3 if you have interrogation there that the body needs for protection. So there's a couple of ways of looking at it from the safety aspect. One, making sure you don't shut off the faucet completely; and two, kind of more specific targeting, if it's possible to go that way with your therapeutic diseases.

Got it. I guess we're going to have a bunch of panels today. And I think one of the underlying things that I've seen in, at least in immunology, is that you can find kind of similar biology and derisk that pretty quickly and kind of have this "pipeline in a product". So I mean, maybe Cedric, do you see that with pegcetacoplan? I mean, you have 2 indications, but 2 different routes of administration. But where else do you kind of see that going? And I guess, from your standpoint, based on some of the things that we talked about, different types of crosstalk between the complement cascade and things like that, is that -- does it make it very challenging to really hone in and identify pretty derisked indications?

Yes. So the answer is absolutely yes, right? I mean, we've spoken about that publicly to some extent, not a lot yet. We have a proof-of-concept in C3 glomerulopathy and I think cold agglutinin disease. We are -- what we have done in the past couple of months is kind of really think strategically through the next couple of years. I mean, what can we do with the subcutaneous form of pegcetacoplan in a range of other indications? How do you stagger those over time? How do you make sure that they're truly giving a benefit to patients and not create a me-too situation. I'd like to think that what we did in PNH was not just create a drug for PNH, but a drug that truly gives the benefit to patients over and above what C5 could do. Generally, we think about the world in those terms. And then to your point, you get to choose between indications where the control of complements has a solid, robust proof-of-concept behind it, generally with C5, obviously, because of Soliris being there. An example could be myasthenia gravis, for example. If you control myasthenia gravis at the level of C3, very likely, you will also find an efficacy profile there. The question is, will it be better or not? That we could hold the answer to. So -- and then there are new indications. I mean, there's a laundry list, right, of diseases where complement is very likely involved. We think that neurodegeneration is a very exciting place, specifically for C3. And controlling C3 in neurology is something that we are very interested in, and that we'll see where that goes as well. So answer is yes, absolutely, a platform. More to follow in the months to come, but we intend to deploy that.

Yes. And Grant, just turning over to you. You guys have your kind of platform that you're working on. But how are kind of thinking about indication selection? And I know you're partnered with Biogen on geographic atrophy. So just kind of thinking about, longer term, where do you think you will look in terms of indication selection.

Yes. Great. Yes. So it's -- for us, the strategy is thinking about our platform being protease engineering. And these are protease cascades, so really, the natural way to think of a way to intervene there is to engineer proteases to play in specific niches of the cascade and where it makes sense. As you pointed out, Biogen, 2782 PEG is partnering with Biogen for dry AMD in ophthalmology. It's a great molecule for that. We showed some really nice data at ARGO in 2019. And the collaboration is going well with Biogen there. So we're excited to see that molecule moving forward. With our own strategic pipeline we have going, we're thinking about where we can best intervene in the cascades, and perhaps modulate one niche or the other along the pathway using proteases. And I think this kind of goes back to some of the discussion we had a little earlier about different parts of the cascade maybe much more relevant to target for different diseases and therapeutic areas. So as we do our therapeutic area selection of those that are an interest for us, those -- again, if they're validated and derisked by other programs going on that's -- those are attractive targets. As well as there's a lot of other new ones that are just coming up in the literature as people investigate more about complement and its roles. We look to find what part of the cascade would be the best area to target. And then, then, we work on engineering our proteases to work in those areas.

Excellent. And obviously, this is a very topical sort of question. But I guess, Cedric, in terms of COVID and where you think maybe the complement cascade plays a role in COVID-19 related arts, maybe just talk to us about the rationale here. I know you guys have a trial. And I'd love to get Grant's take on this, too. But maybe just walk us through kind of the biology and your thoughts in terms of the MOA.

Yes. No. Thank you, Derek. So we believe that complement plays a very important role in the thrombotic microangiopathy that seems to be very important in this disease, right? So when you go back to January, February and March, at the time, we thought about COVID-19 as a disease of ARDS, right? Acute respiratory distress syndrome. And it turned out, and that was the whole story around ventilators, of course, for those on the panel -- or on the screen here that haven't followed that. The story around the ventilators was very much focused on that. And as it turns out now, ventilators are far less important. As a matter of fact, probably hurt the lungs in many circumstances more than anything else, than conversely, making sure that you control the inflammation, specifically the underlying thrombotic microangiopathy that happens. When you think about patients with COVID-19 that come into the emergency room, what's most striking there is they come in often feeling a little long-winded, not feeling good. And then they put on a pulse ox and they have a saturation of 60 or 70. And that's kind of a big disconnect. And that is much less like ARDS and much more like pulmonary embolism. When you have a young woman on the pill who smokes and who comes into your emergency room, very similar to that, your immediate thoughts should go to a deep venous thrombosis that is shooting little emboli into the lungs. And what happens when you have these small micro -- small clots, tiny clots in the capillary of the lungs, is you start having perfusion ventilation differences that start occurring in the lung. And I would bet a lot of money that if you were to do a wedge-pressure analysis of the arterial blood pressure, which is complicated and invasive, which is why it doesn't happen, that probably most of these patients have severe pulmonary arterial hypertension. And I mentioned all of that because controlling these blood clots is actually, we believe, very important, and we believe, driven by complement. So you asked how does that happen? And I'm sorry, Grant, I'm taking a little bit -- a lot of time here, but I think it's important. The reason why we think this happens is that virus is going to circulation and are immediately opsonized by complement factor C3. And there's a little thing about complement biology that most people tend to forget, and that is that when C3 binds to cell surface, it binds covalently. Once it's there, it's there forever. It doesn't go anywhere anymore. And the purpose of that is that now this viral particle becomes engulfed with C3 product. And that's a good thing because most of its cells will see that and actually phagocyte those and eat these particles. In the case of COVID-19, that actually -- that precise mechanism becomes a little bit of a liability. Because what you get on the surface of these viral particles is not inactive C3 products or degraded C3 products. These are active, preformed convertases. And when these cells actually bind to the cells that happen to be around, they deliver not just their payloads, but also a piece of membrane that is covered in these preactivated convertases. And when that happens on a cell's surface, on our own cells now, right, in the lungs, in the blood vessels, the endothelial cells, you start getting massive activation on these cell surfaces. And we have our own defense against that, right? We inactivate complement on our own surfaces. And we have the last line of defense called CD59 to prevent the formation of the membrane attack complex so the cells don't exclude. These defenses are limited in terms of what they can do. You can run out of these differences. And that's what we believe is happening in these patients, is that at the level of the platelets, you will start seeing activation on the platelets that leads to these thrombotic microangiopathies, but also at the level of the endothelial cells, where over-activation of complement on these cell surfaces puts stress on them, leads ultimately to endothelial dysfunction and contributes to the pathology.

Got it. I don't know, Grant, if you want to add anything to that.

I think that was a really great explanation and giving kind of the etiology of how complement can play in -- with COVID-19 and the viral infection and how it hijacks the body. I think that was a great explanation. I would just add, again, with kind of thinking of the endothelium you're targeting, that's where you got a lot of triggers for your coagulation. You get von Willebrand factor binding. You have a big crossover between complement and how von Willebrand factor is working, and this leads to platelet aggregation and you get a lot of these thrombotic microangiopathies coming out of that. So it is, yes, it's kind of a snowball effect going down, and then eventual organ damage.

Got it. Okay. Well, I want to shift gears just to kind of get some of the company-specific questions in terms of both of your stories and kind of the updates here. So maybe just starting with Cedric. You guys just submitted your NDA for pegcetacoplan in PNH. I kind of wanted to just get your thoughts on potential labeling scenarios for that indication for pegcetacoplan.

Yes, yes. NDA submissions are a lot of work. It takes more than a couple of days. There was a special exercise to go through. We're not commenting on labeling yet. What I will kind of point out here is that we ran the PEGASUS study with a big chip on our shoulder, right? I mean, at the end of the day, you have to remember that in PNH, patients suffer from a life-threatening disease. And when they take C5 inhibitor like Soliris to Ultomiris, they're taking a life-saving drug. Now as it turns out, when you block at the level of C5, you do nothing about the fact that red blood cells in these patients get coated with C3 covalently, as we were talking about with COVID as well, right? And that essentially makes the survival span of these red blood cells much shorter than they're supposed to. I mean, red blood cells are supposed to live 3 to 4 months. But if you cover them in C3, they will get removed in the liver and the spleen by monocytic cells. So that is reflected in the PNH population in a significant unmet need in terms of severe anemia, in terms of -- it is severe transfusion dependency. But you cannot measure this process of C3 covering and removal in the liver. So that was really hypothetical. And a lot of people were skeptical that you could do anything about the anemia and transfusion dependency in these patients. So I mentioned that because when we ran our Phase III clinical trial, we did it in a way where we thought it was very important to make it comfortable for patients and physicians to switch over to a product that would make them better, but cognizant of the fact that they have a life-threatening disease and are taking a life-saving drug in the form of Soliris. So what did we kind of envision when we did this trial? We said we're going to take 1 month in which we don't ask a patient to discontinue their C5 inhibitor and we're going to layer our drug on top of that C5 inhibitor. Not just in the active group, also in the control group. And then after 1 month in the control group, we're going to remove pegcetacoplan again and they're going to go back to where they were before. And obviously, that was highly unpleasant to do because the efficacy difference was, quite frankly, beyond what we even thought would happen. But what we have now is you can tell a patient it is safe for you to try pegcetacoplan for a few weeks. And if it doesn't do it for you, within a few weeks, you're back to where you were before. And you can do that safely. After that, we had a 4-month monotherapy phase, in which each patients were on pegcetacoplan alone or Soliris alone. And so from the labeling perspective, we believe that we have established efficacy for the monotherapy period as well, even though it went through a switchover phase. So that's a long answer to your question. We hope to have a broad label, but we're not commenting or guiding on anything yet.

Got it. Okay. And in terms of like if you were to get maybe second line, would this be like second line to a C5 class? Or would it be just to Soliris because there were no patients, right, on Ultomiris in your study because it wasn't approved yet, I don't believe.

Well, when you look at the efficacy profile of Soliris versus Ultomiris, right, it's a pharmacodynamic play, right, at the end of the day. But it is the exact same target with the exact same problems in patients as you do with Soliris. So we believe that this is a class improvement, not a drug improvement. And hopefully, that will be reflected in our label.

And the other thing was in terms of like kind of the commercial aspect of this, how much of advantage do you think there is with subcu infusion delivery versus kind of IV? And we've seen with Alexion, obviously the Ultomiris approval, but also the fact that they're trying to shorten the infusion time. They may go subcu also. So just kind of your thoughts, longer term, in terms of the competitiveness around that route of administration.

Yes. There is -- in terms of the convenience of these things, there is not really a black or white, right? There's a lot of gray. I mean, for us on the call here and probably most people listening, we're very active. I'm not particularly excited about spending 1 day every 2 months. Because it takes a full day. You have to travel to the clinic. It's a long intravenous infusion with Ultomiris, right? I mean -- and I'm not talking about Soliris, which is every 2 weeks. But taking Ultomiris where every 8 weeks, you have to go into a clinic and have a 3 hour-long infusion. And between checking in, getting that, going out, it's a full day that you lose. For me, that is not very attractive. If you have a convenient and easy twice-a-week subcutaneous infusion that takes 30 minutes and that you can do at home, I would prefer that. But if you have older people that want to see their physician every 2 months, assuming that, yes, efficacy were to be the same because that, at the end of the day, in our opinion, trumps everything, right? But just purely focused on the convenience, some people may prefer to get an intravenous and seeing their doctor. Other people may prefer to have an oral product in spite of the liabilities of forgetting to take a pill. So I don't think there's a black or white. At the end of the day, what matters in -- particularly in PNH, we believe, is the efficacy profile.

Yes. And can you just remind us in terms of the device you guys use for the subcu infusion? Like how long is the infusion? I think it's twice weekly, if I recall the dosing regimen. But maybe just provide a little bit more detail on that.

Yes, correct. It's twice a week subcutaneous. Right now, the way -- I'll just graphically quickly explain it because it will make it clear to you. You have a vial in the fridge, knowing that you can travel with it at room temperature, and it will -- that won't be in the initial label, but that will come. We have the stability for that. When you take it out of the fridge, you have to take it out with an 18-gauge extraction needle from the vial. You're going to remove the 18 gauge needle, put on a butterfly. You stick the syringe in kind of a spring that pushes on the plunger and you put the butterfly under your skin. You can walk around with this. It takes about 30 minutes to do. We also have an in-house -- or I should say a collaboration where we are developing a device where the experience becomes needle-less. There's no more manipulation of any needles at all. You take the vial, you stick it in a receptacle, it sucks the liquid automatically into a disc. You place that disc on your abdomen, it sticks to it. You click on a button, 4-millimeter 30-gauge needle goes under the skin and delivers the product over 30 minutes. So that will come on the market about 1.5 years after our initial launch and we believe will be a great improvement for these patients as well.

And then just one last question before we go to geographic atrophy. But obviously, we've seen the data from LNP-023. We saw some data from the BioCryst folks yesterday for some oral complement inhibitors. So just kind of your thoughts on -- I mean, you alluded to this a little bit earlier in the discussion, but just kind of your thoughts on kind of the oral competition coming into the PNH market. Again, how that might impact pegcetacoplan.

Yes. I think, look, again, in PNH, efficacy is the single most important thing in that disease. So I think in PNH, it's going to depend in the long run how these oral products perform on an efficacy basis. I also think it will depend a little bit on the personalities of people. If you have to take a pill twice a day and forgetting to take a pill could have bad consequences, again, from my personal viewpoint, I would prefer twice a week subcutaneous, which even that I can forget and know that for 3 or 4 days, nothing bad is going to happen to me. So I think it kind of -- but having said that, the BioCryst data also look beautiful and the LNP-023 as well. These are -- look like great molecules. I mean, they are serum protease inhibitors. So in the long run, again, we'll have to make sure that they're safe to use and also cross reactivities. But it will be great in the armamentarium for not just PNH patients, but patients generally with all these conditions, to have an oral product available.

Got it. Okay. And then just a couple on geographic atrophy before going back to Grant. But I guess, maybe just give us an update on the recruitment for your 2 studies there. And then as you think about the bar for efficacy in geographic atrophy, obviously, there's nothing approved there. But what do you think that efficacy bar is right now for that indication?

Yes. So we -- so to your first question, the study was fully enrolled by early July, and we will have a readout in Q3 of next year. Very, very, very important studies for us, obviously considering the investment that we're making. I think also for the field because it's -- there have been so many failures in geographic atrophy that it's important that we get it across the finish line. Sorry, the second piece of your question was what again, Derek?

What do you think the efficacy bar is there? I mean, obviously, we know there's nothing approved. But like what do you think would be very clinically meaningful in that population?

Yes. So we actually have -- are doing a lot of research on that to kind of understand and prepare for our commercialization. Depending on which physician you ask, they will tell you 20% to 30%. It's generally in that range in terms of reduction over the course of 1 year, which ironically is exactly what we saw with monthly and every other month in our Phase II clinical trial. What was intriguing in our Phase II clinical trial is that from month 6 to month 12, there was a clear trend for an increased effect size from month 6 to month 12. And that's something that we'll have to see if that continues to "improve" when you continue to dose into the second year. That's something very exciting for us. The Phase III, even though it reads out at 1 year, will have continued randomized and will read out again at 2 years. And we'll see if there's a further improvement in these patients.

Got it. All right. Well, let's shift to Grant and the kind of what they're doing at Catalyst Bio. Maybe you talked a little bit about your platform. And maybe you could just give us some of the details around the way you're approaching complement inhibition. And again, I think your program is pretty early, but any sort of data you can share thus far that you've generated, preclinically or clinically, that would be helpful.

Yes, yes. So excellent. So yes, so the protease platform has protease engineering, and you can think of it as kind of 2 pillars. So in one sense, we're optimizing natural proteases, and this kind of leads into what we have for our compounds in hemophilia for hemophilia B and also for -- and with inhibitors with marzeptacog, alpha-activated. These are optimized, engineered versions of the natural proteases. And then on the other pillar, you have taking a protease scaffold and then engineering it to do something new. And this is what we did with 2782-PEG. And this is a protease scaffold and it's been engineered to specifically cleave C3, as I said before, at a part that makes the fragments kind of inactive and can't move on any further. And we do this through a molecular evolution platform. So we've got kind of the 2 pillars and sometimes kind of programs going forward, a complement will then be a fusion of the 2 types of programs, taking molecular evolution approaches as well as optimizing proteases that are already there in the cascade. These are ways we can think of right now how we would go forward with these programs. The preclinical data on 2782, like I said, we showed at ARGO, which was really exciting. In a 28-day study, we were able to knock down and suppressed C3 for 28 days with no C3. We can take this initial study, and we can model the affected PDs that we might get in humans. And so if you recall, with proteases, you have the advantage that even though your PK is going down and you may have lost your compound by up to 3 logs, we still had C3 suppressed in this preclinical model. And then -- so you have this really extended-duration PD effect after your PK has gone away. And that's really harnessing this power of proteases that we talked about. And then when we modeled this to the human condition, so you can take your preclinical models and you can do [ measured ] scaling and you can take what your suspected dosing is going to be in humans, in this case, we feel that we will be able to dose every 3 or 4 months and be able to keep that C3 level below 90% target levels, so that 90% of the C3 has been knocked down. And then this correlates pretty well with the expectations that Cedric's team has shown with how much C3 suppression you need to get really good, beneficial effects in geographic atrophy.

Got it. I guess, as you think about kind of indication expansion, and you talked about this a little bit earlier, but is there any kind of safety risk associated with your approach when you go systemic? Would you be looking at systemic? Or does it kind of limit you to only really local type of delivery?

No, no. I mean, what we're looking to do is go into the systemic area. So we see subcutaneous systemic complement inhibitors is kind of where our future is and moving into other indications. And it's a matter of -- as I already mentioned before, you want it -- you would tailor the protease weighing that specificity and safety profile. And so that's what we have in the power, in kind of behind our engineering platform, is to do that. And make sure that anything comes out is going to be -- have a very low risk of safety profile and tolerability.

Got it. Okay. And then I think you guys have an event coming up where you're going to highlight some of the complement stuff you're working on. I don't know if you want to just, yes -- real quick. Then we have...

So we haven't talked much about our complement program other than the partnered one with Biogen. We have a lead molecule we've shown just a little bit of data on for extended half-life showing that we can go once-weekly subcutaneous with this molecule. There will be much more of a reveal coming out in the end of the year. In December, we'll have a KOL Research Day where we'll talk more about our lead molecule and as well as what else we'll be doing in the complement field.

Excellent. So yes, I want to just tackle a question or 2 we got from some listeners. So one being -- and I think this is directed towards Cedric on that COVID explanation. On that epitheliopathy explanation for COVID morbidity sounds a lot like aHUS. How come we don't see signs of hemolysis or hemoglobinuria, anemia, et cetera? Any thoughts on that question?

Well, we do see LDH increases, right, in COVID-19. The amount of -- and there is probably some hemolysis going on, but you have to remember that the red blood cells in normal -- most normal individuals are not like the red blood cells in PNH or in aHUS, where there's actually complement disregulation that is happening on a genetic basis. So I think the main component there is that your CD59 sits on the cell surface and blocks the formation of the membrane attack complex. So to truly see intravascular hemolysis to the extent that you do in PNH, you won't have. In aHUS, you have more hemolysis. It's better contained as well. You do have CD59 in that case. But in aHUS, the damage in the kidney that you see is subsequent, obviously, to these [ histo cells ] going around and the thrombosis associated with that. But I think that, in my opinion, there is some hemolysis going on, and there is clearly kidney targeting as well that happens in COVID-19.

Got it. Okay. Well, guys, thank you so much for the discussion. Grant and Cedric, again, thanks we're kicking off the event this morning, and look forward to catching up soon. But I think we'll leave this panel here. So thanks again, gentlemen.

Thank you so much. Take care.

Thank you very much, Derek. Appreciate it. Goodbye.