BioMarin Pharmaceutical Inc. (BMRN) Earnings Call Transcript & Summary

Well, it's absolutely important in the way that these children interact with their environment. Think about coming their hair, reaching up onto our shelf, driving these sorts of things. So from that standpoint, we think both the payers and the patients are going to see this data set. And like we were quite pleased to see that there's a -- presuming it gets approved, a safe and effective therapy for patients. On the issue of potential approval, is full approval on the table here? And if not, do you have clarity -- regulatory clarity of what would be needed to support a full approval hypochondroplasia.

Yes. It's an excellent question. Of course, we've been talking about the full approval package for achondroplasia. And clearly, there are precedents where that could set up a follow-on indication if it's closely enough related for full approval to be considered. Ultimately, that will be at the discretion of the regulators. But I just want to reassure you, we're working very closely with them. We have 2 files that are in the FDA right now, other regions as well. And so from that standpoint, looking forward to being able to close the book again on that full approval for Aecon and again, see what comes with Hypocon. So more to come. And I think as we get more clarity from our interactions with the FDA, we'll be able to share more details on earnings calls.

Before we leave this this space with skeletal dysplasia. Maybe we could touch on BMN 333, where you've guided to an update from the Phase II study portion of the pivotal trial you're currently running. Maybe just you could help with sort of stage setting there, the endpoints that you're most interested in interrogating in that Phase II study portion? And what would you hope to see that would satisfy differentiation versus ?

Yes. And what we know about BMN 333, -- number one, it was engineered to have a longer half-life. So it's got about 100 hour half-life roughly. And it's a construct that again, releases the free CNP into the bloodstream, Think of it like a depot in that sense. So it's more of a continuous administration. That's very different than, of course, Voxogo. That's got less than 1 hour life, more of a sawtooth pattern for PK. Now with that continuous exposure, we ask 2 questions. Can we see more PK coverage safely as compared to, say, and can we see more PD at least in the bloodstream. And the short answer is yes. We published a Phase I protocol. It was at Endo this year, where we saw up to 13-fold increases in AUC for free CNP as compared to what was able to produce. Similarly, that was accompanied by conservatively a 2- to 5-fold increase in cyclic GMP in the plasma. Again, it's not the growth plate. But again, it shows that there's more biology at least to be tapped into, at least in the bloodstream. So one step closer. The next step, of course, is we need to move out of healthy volunteers, and we need to move into patients. We're running a study in treatment-naive achondroplasia patients. So you need to, again, go to the countries where those patients exist. We're in 7 countries around the globe right now that's increasing. We're in the steep part of the enrollment curve more to come in that regard. But that study is a classic dose-ranging study. It's looking at 3 different doses of BMN 333, call it high, medium and low and we will be looking at an internal control of Voxogo there as well. Our goal is to pick a dose as compared to Voxogo that will give a high confidence in a Phase III to have a superior growth profile. So what are we going to look at in that Phase II to determine that? Well, 2 things. One is, we will be measuring annualized growth velocity, we will cut the data when every patient has at least 6 months of follow-up. So again, it will be more than 6 months in some patients. There'll be a Bayesian approach applied. There's an internal control of 10 patients on Vaxogo. That will be a quick spot check. We have hundreds and hundreds of patients of that we can put into a model if we need to as well. But the goal there is, again, not only looking at the dose response, but also we'll have the ability to look at exposure response, which across 3 dose levels of 333 is going to give us, hopefully, a good spread of exposure there. And with that, we would pick a dose to move forward to Phase III. We'll, of course, look at safety data as well. But the Phase III, as it's currently designed, is a superiority study. There's no placebo. So patients either receive Vaxogo or 333. And we've powered it to have 90% power to detect a 50% improvement in attributable AGV. That's not the minimum detectable number, and then you can back calculate the math. But it's 60 versus 60 in each arm. And again, the go signal would come out of the Phase II. That Phase II data will be available to us, and we would be planning to publish that. That is going to be something that we will announce sometime in 2027.

Okay. Great. All right. Let's shift gears a little bit to the pipeline. I want to pick up on the Alesta ALDI acquisition. Acquisition closed recently, right? Last week, right? Just by MOA, just to be clear here, this is an ENPP1 inhibitor, if I have that correct. Is it's a small molecule and PP1 inhibitor.

So in these individuals, they have high pyrophosphate. That's their problem. That's a direct inhibitor of bone mineralization and fantastic work that's been done for the field with Strensiq and the follow-on agents that are basically replacing the fishing enzyme, which is tissue nonspecific alkaline phosphatase. And at the bone, it's taking that high pyrophosphate and converting it through to its end products. A lot of great work has been done there. This is a slightly different approach. I guess similar to Gauche, this is upstream. It's trying to deplete the substrate, try to deplete this or phosphate by inhibiting the enzyme that creates inorganic pyrophosphate. And that's NPP a lot of good preclinical data. There's some sort of gene load cross mouse crosses that suggest that about a 50% reduction in ENPP1 enzyme activity can restore bone mineralization in HPP models in rodent models. What we've seen with this small molecule inhibitor of ENPP1 is we've seen healthy volunteer data and a limited amount of patient data. Again, looking at the PK profile, the PD profile and the safety and again, seeing that the molecule is meeting the requirements that we would want to see to take it forward into patients. So now again, we are acquiring this molecule. It's finishing up its Phase I portion. This is a study that's running outside the U.S. So of course, we've got to finish chronic and get it filed in the U.S. But the promise here is that you don't just have a more convenient Strensiq, the promise of the molecule is that it actually will also be able to reach those compartments that aren't bone related. So particularly, the HPP patients fall into a couple of different bins -- a couple of different buckets on when the phenotype presents itself and particularly those where it presents later in life for the adults with HPP, many of their complaints are not the classic bone-related pathology and said it's things like fatigue, malaise, muscle pain, a small molecule without the bone targeting biologic aspect has the promise to be able to target those compartments as well. So that's where we see the opportunity here. It's an established commercial space. They are established regulatory endpoints, some great work that's been done by the alkaline phosphatase molecules, really to work on these patient populations, understand the end points we're hoping just like they are to learn from that and again, bring patients something at value.

Anything you want to add, Cristin? Just in relation to the ongoing study, Yes. Just any sort of loose guidance you might offer in terms of when we would expect an initial readout and sort of the scope of that readout, understanding that it's both we have this right. Is it both in healthy volunteers and in patients -- there are patients -- and since the date is a week old, we're still working through, again, exactly how the Phase I to Phase II transition is going to play out. We, of course, need to engage with regulators.

The short answer, though, is we plan to publish this data next year. There will be a public disclosure of both the healthy volunteer and some amount of patient data. And what you can expect is not only PK profile, but also PD enzyme inhibition. Again, as I mentioned, the preclinical model suggests something between 30% and 50% reduction in ENPP1 activity could have dramatic influences on pyrophosphate. And it's -- again, it's been shown quite nicely by the alkaline phosphatase molecules that all of the benefits that they achieve in these older patients. We're not talking about infants, but children through the adults really tracked with decreases in pyrophosphate. So we think this as a fairly derisked approach. And again, we'll be presenting that data more broadly next year.

And just in thinking about the spectrum of disease where you hope that you hope to address particularly the sort of the older adult onset that you spoke to earlier, I guess we have a lot of development and regulatory precedent in the Juvenile, so I'd imagine a little bit less on the older -- maybe you can just sort of speak to the development outlook or what development plans could look like in that segment? And what you would ultimately hope to demonstrate clinically.

I think what the field has learned and it spends some great work is that these are distinct populations. -- you can talk about when the onset of it, is it a juvenile onset adult, an adult onset adults, a teen, preposterowth plate closure, all of this is important but you have to target not only the dosing, but also the endpoint measurements to the right population. So clustering them together is probably not the right answer. So moving forward, again, we envision teasing these populations out. And then again, the beauty of the timing of this is that we can look at those individual populations and continue to do endpoint development. particularly with the adults, once the growth plates are closed, you can't look at the rickets scores and so forth. You don't have that window and a bone formation. So the more blunt endpoints, like 6-minute walk test, some of these functional endpoints have been notoriously fickle in order to see the effect of your drug. There are newer technologies that are measuring motion. There are subsets sit to rise. There are a variety of different measures that we would intend to explore in our Phase II program, so that by the time we reach Phase III, again, we would have solved not only the patient population question, what's the right endpoint and what's that effect size? How do we power that study?

Excellent. Maybe again, sticking -- moving further down the pipeline or elsewhere in the pipeline, I should say, I want to pick up on the dimeric compound BMN 820 and FSGS. I guess that study is now fully enrolled and you talked about sort of a readout in 2028. That being said, right, and I guess it's on 2-year EGFR that you're looking at. I don't want a 2-year proteinuria. Excuse me big movement in the field and some great Sparsentan has done some great work opening this up, but the FDA now accepts 2-year proteinuria as a full approval end point.

Okay. Right. Okay. And you were -- yes, because the question that is line in my mind is whether there's an opportunity for accelerated approval based on 1-year endpoints that are being leveraged in like disease or diseases in this -- in the kidney disease category. -- thoughts around sort of the flexibility that you -- any optionality, I guess, in the conduct of this trial where you might look to either look at data early and follow on an accelerated time line. So our current belief is that the 2-year reduction in proteinuria is the endpoint, and it's fairly solid. Now that being said, we have some knowledge, again, how the study is performing already. That's the study remains blinded. There was a fairly small Phase II data set that this Phase III study was built upon. That being said, we know that the study has #1 pass-through futility analysis. And number two, we know that it also from the standpoint of sample size that it's adequately powered to measure a meaningful decrease in proteinuria. So there was a formal sample size reassessment done again on blinded data. And the study is appropriately sized enrolled, it overenrolled a little bit, I think, which is great. That was by demand. Patients were interested in it in the study. And again, the promise here is that an oral therapy, it targets CCR2. So the idea here is it's not necessarily a at-targeting agent. It's targeting this macrophage-induced inflammatory response that, again, leads to the destruction of some of the kidney podocytes. And the hope here is that by having a molecule that would have a meaningful reduction in proteinuria and not have the baggage of things like a black box warning, not having the baggage again of having to restrict to certain levels of proteinuria to non-nephrotic syndrome patients that, that would be of great interest to the community. Being a different mechanism of action than the pure vascular side as well. The idea of combining these agents becomes important. This study is designed to add on to arb therapy as a base line. So it's not displacing like sparsentan did a prior ARB inhibitor. It's an ARB inhibitor plus/minus the DMX, the BMN 820 compound. And from that standpoint, again, you have to make sure you look at it through that lens. But that meaningful decrease in proteinuria is something we know the study is well sized for -- and again, a lot of promise with regard to this mechanism of action that it will offer patients something important.

Excellent I'm going to end on a thematic question here. And our colleagues in tech, we're also running a conference this week, and so perhaps I'm asking this question on their behalf. But obviously, we're often thinking about how AI, AI-enabled tools impact our businesses, all of our businesses. How is BioMarin making use of AI tools today? And how are you measuring their impact?

Yes. And the tools can be quite powerful. If you put them in the hands of the right people, you feed them the right data in the right format and then you do something with it. And so I would say there's 2 places in R&D that we've really leaned into. One is reading and writing, right? I mean we have a very document heavy work -- so the idea of cutting out the white space between times, for example, when we lock a database and we file a program. It is about using AI tools to create some of those documents the filings, but also inserting that into the workflows in the right way, so people can get these work products out as fast as possible. We had a great example of a success recently with hypochondroplasia, 79 days between database lock and the submission to the FDA. That does put us in, we think, the -- what at least the McKinsey numbers, we put that in kind of the top quartile. But the whole deal is moving fast. That's great for patients. Otherwise, this is busy time, so to speak. So you can imagine having that kind of approach all along drugs life cycle and whether it's filing of an IND or again, filing for a new clinical trial, all of these factors can add up and reduce cycle time. I would say that the second major area that we're using AI has to do with patient finding. And in that regard, using some of these algorithms to look at very complex data sets. They might include genetic data looking for hotspots around the globe, they may include social listening. And again, the activities that are going on where we know that patients who are quite educated are seeking out information. They're just not finding their way to a physician. And then, of course, the opportunity to do good old-fashioned looking at claims databases and so forth. That does allow us to find patients not only in the commercial sector but also for our clinical trials. And we have some great examples where we even found a patient who was an in-utero patient. It was a mom looking up for hypochondroplasia on the Internet, and again, she was supported to one of our clinical trials. So they work. It's very helpful. I would say that the area that I would love to see us lean into more and we're dipping our toe here is giving these tools to the scientists and allowing them, again, when it comes to molecular design, organic chemistry and amino acids are another form of a language right? So the large language models do a good job creating some of these reagents. That will hopefully cut down the time and the number of molecules that we have to test as we go through our own funnels to bring these things into the clinic. So we have the luxury at BioMarin of -- we have some resources. Again, with all the work we've been doing, we have about $1 billion of free cash flow a year. That means that we don't always have to be on the bleeding edge of these technologies, and we're finding that there's a very vibrant third-party sector. They battled it out for the winners. But writing things like clinical study reports, we're able to actually test a couple of them and see which of these tools is the one that works best for us. And we're finding that in addition to some of our work with Veeva and so forth, getting our data lined up. I do think that there's a major opportunity here to do more with less. And as an R&D guy, I've got a budget, and I need to get as much activity into it and get as much to patients as I can. And that's really the name of the game right now. Technology is part of it, but it is enabling the people who have the creativity to do the work.

Great. Well, that's a good note to leave it on. Thanks so much, Greg and Cristin for your time today. We really appreciate it.