BridgeBio Pharma, Inc. (BBIO) Earnings Call Transcript & Summary

Good afternoon. Welcome, everyone. My name is Jamie Adolph, and I'm an investment banker here at Morgan Stanley. Today, I'm joined by Neil Kumar, CEO and Founder of BridgeBio. Thank you for joining us here today.

Thanks, Jamie. Thanks for having me and thanks to Jessica and the whole Morgan Stanley team for having me here again.

Yes, of course. It's great to have you back. Now before we kick off, I do have a few words on disclosures. For important disclosures, please see the Morgan Stanley research disclosure website at morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative.

So that will kick things off. To start things off, can you give us a high-level overview of where BridgeBio stands today and how you see the company evolving from one approved product into a multistage multi-asset late-stage biotech?

Sure. Yes. Thanks for the question. So as I think many in the room know, this year has really been focused on the Attruby launch and proving that we can marry what I've seen is a high degree of R&D productivity with some commercial productivity and obviously, a lot more to do on that launch, but we're happy with how that's been evolving. And so where that really brings us right now is on the cusp of becoming, as you just mentioned, a multiproduct company with 3 Phase IIIs reading out here in the next 6 months in ADH1, in LGMD2I and in achondroplasia. And so the density of those readouts portends, I think, the making of the next really large, hopefully, generational technology company in the area of Mendelian disease. And the only thing I'd say about that is it really has been the nature of the decentralized design to provide what we call returns to scale or increase productivity per unit of time or per unit of cost as the company grows. So if you look across the ecosystem of BridgeBio, and I really do think of it that way. So there's BridgeBio, there's GondolaBio and there's BridgeBio Oncology Therapeutics, the density of readouts in terms of Phase II readouts, Phase III readouts over the course of the coming several years is incredibly intent. And I think that allows us to dream of a company that could continue to grow with that type of R&D productivity, hopefully married with continued commercial productivity.

That's great. And maybe to start off, I know you've had a fantastic launch with Attruby. Can you tells more about how the launch is progressing, what you're seeing with treatment naive and switch patients as well as how clinical data and payer dynamics are shaping the continued commercialization here?

Yes, sure. I'll try to unpack that in a relatively short period of time. I'm following the CEO of Bayer Pharmaceuticals, who said this is one of the best launches he's ever been a part of in Europe. And I can say that's the case for myself as well, but it is the only launch I've been a part of, so far.

So far.

So far. And so we've been pleased with the brand growth, particularly pleased with NBRx share growth. That's really where we've targeted much of our efforts. But really, I think the journey with acoramidis starts with clinical differentiation. And it really starts with the base of what we call [ 3, 42, 50 ], the earliest known separation against the seminal endpoints of cardiovascular hospitalization and mortality, the greatest relative risk reduction at 30 (sic) [ 3 ] months and 42% that we've seen in the field as a point estimate with 50% reduction in hospitalization, hospitalization being the majority of events that we see in this space in the modern trial regime. And what we've tried to then do is to build off of that and say a couple of things. One is, in the broad population, how do we continue to kind of connect the dots between ever better stabilization. Just as a reminder, and as [ Stephan ] suggested, we're 90-plus percent stabilizer as compared to Pfizer is about 61% stabilization. So how do you marry that with actual outcomes? And we had some important research that suggested that ever higher levels of serum TTR as an in vivo measure stabilization lead to ever lower levels of mortality and hospitalization. We were able to demonstrate at this latest ESC conference, remarkable hazard reduction of 44% in the context at 42 months in the context of cardiovascular mortality, highly statistically significant, again, a better point estimate than what I saw from the knockdowns who also presented some of their long-term follow-up. And importantly, we're starting to see and publish on improvements within the patient population, things like 45% of patients improving on NT-proBNP by month 30, those are going to be important as we look overall at the population. And then the second step really is to think about subpopulations. So I think you saw the variant literature that we published at an earlier conference this year, suggesting that we had, again, the highest relative risk reduction in that space with [ STAT/sake ], which I don't think anyone else has been able to achieve. We also published quite broadly on our impact within the AFib population, which affected almost half of our patients, again, what we saw as best-in-class point estimates there. And so we're going to continue to look at that. I mean there was an interesting paper in journal of lipidology, recently suggesting that folks with tafamidis are not well controlled given their DDI with Rosuva and Atorva. So all these little populations where you could suggest that Attruby might be the best brand in this space, I think, is going to be important. And so really, it's that clinical differentiation. We couple that then with many of our commercial efforts. Obviously, you heard in Europe that they're going to be market leaders sometime soon. I think we aspire to do that. We certainly reset our expectations to be even better than when we started at 35% [ PK ] share, but it's going to take some time. In the U.S., primarily, we are the smallest sales force out there. Our share of voice, we need to bolster that over time. But like I just came back from Orlando and Pfizer has got a huge 12-foot sign that says VYNDAMAX, only approved product in ATTR-cardiomyopathy. So these are the types of things that we're going to have to battle against misinformation, disinformation, I think we'll do a good job of it. And over time, the data is going to set us... Look, at the end of the day, if you have the best clinical data in terms of point estimates, no double-blind head-to-head run. If the biochemistry and path of mechanism suggests that you are doing the best in terms of lowering the amount of toxic monomer that's depositing the heart and all of that is available at the lowest price point in the category, I'm not sure why, over time, we wouldn't ultimately be the brand of preference, but we have work to do between now and then to get there.

Yes, that makes a lot of sense. One thing you referenced a few times is your partnership with Bayer, the commercialization in Europe. Can you tell us a bit more about how that's progressing and what early takeaways you have from that launch? And also how that impacts your broader international strategy?

Yes. I won't say much more because I think many in the room are here for Stephan's comments. Maybe I'll say, one that the rapidity of the launch has been striking. Number two, that the payer physician entities in that space, I think, mirror how this category will evolve over time, having a strong look at health economic data, having a strong look at what's known about efficacy. Critical experiments like switch experiments where you take one drug product -- patients on one drug product and you put them on another drug product. These are the types of things we're doing, real-world evidence studies that are comparative and we're going to publish a lot more in that space as well. And I think as those bodies look at things, obviously, Stephan referenced the strong launch in Germany, NBRx share above 40% right of the gates, which is quite striking, but also countries like Denmark, where we've won the national bid. So I think that is resetting, as I said, our expectations for what's possible with this drug. You heard him say it's an easy sell. I'm not sure that's the case. It's always complicated, but I do believe a more potent and better stabilizer over time will be the preferred brand certainly front line for patients with ATTR-cardiomyopathy. Maybe before we move off of ATTR-cardiomyopathy, as you and I have discussed in the past, the most important aspect here is the fact that when we entered the space, there were maybe 50,000 patients diagnosed -- between 40,000 and 50,000. And there's probably 250,000 to 300,000 patients in the United States alone. So -- and this is true of all the sponsors. I think the collaborative work that's being done to identify patients and educate physicians in high-volume heart failure practices has been tremendous. And we're just finding more patients, and we're finding them earlier, which is, I think, the most important piece of caring for these patients in a differentiated way.

That's fantastic. Now I know you have a lot beyond Attruby. So I want to turn my attention to some of the other programs you have in development. Maybe starting with ADH1. Can you tell us a little bit more about what success looks like for Phase III, specifically in terms of trial design, patient finding and market development?

Yes. So ADH1, I think, is a disease condition that many folks haven't done as much work on. It's an important one, and we would be if we're successful in this Phase III first-in-class, so a little bit of a different flavor than our efforts in ATTR-cardiomyopathy and achondroplasia. The ADH1 is fundamentally a condition of low serum calcium and high urine calcium, uniformly arising from gain of function mutations in the calcium sensing receptor. And what our drug does is the negative allosteric modulator of the calcium sensing receptor that sets out to target this well described condition at its source and normalize both serum and urine calcium. And the reason that's important is the diaspora of symptomatology that arises for these patients uniformly tracks low serum or high urine calcium levels. So low serum calcium leading to things like brain fog, tetany, seizures in some cases. High urine calcium leading to downstream nephrocalcinosis, CKD and like. So what we showed in our Phase II data was a 70% normalization or 70% of patients were able to be normalized on serum and urine calcium as compared to 0% in standard of care. And the question that you asked is what are our expectations around Phase III. Obviously, our Phase II or maybe not obviously, but the Phase II was a single site trial at the NIH, and it was also just a handful of the about 100 mutations that affect patients with ADH1. And so the Phase III is obviously 20-plus sites, both in the U.S. and Europe and a multiplicity of those mutations, which is going to be critically important because of paper we recently published suggested that 10,000 to 12,000 patient prevalence within the United States alone for ADH1, importantly spans a wide variety of mutations. And biochemically, we believe our drug should be active there, but we have to prove it in the clinic. So base case, we'd like to hit on the primary endpoint, obviously, which is a -- it's obviously a difference against standard of care, against normalization at the end of the trial. But I think really, what I'd be looking for is an upside case is 50% plus responder. So basically, a 50% plus of these patients analogous to our Phase II are responding to the drug. It truly is a new day in the context of ADH1. And what I think that does is it brings a whole lot of excitement out, both from patients who have been identified, about 4,000 -- a little over 4,000 patients in the United States today. But also for physicians who are seeing nonsurgical hypopara patients where we find about 25% of patients actually have calcium sensing receptor mutations to go and look and see whether or not there are really ADH1 patients hiding within that broader community because you have a truly remarkable drug that's waiting for them. So I'm excited for this readout. I'm hopeful that it provides really a new day and the first new day for ADH1 patients after a long time.

Clear. That's great. We're certainly hopeful for that as well. As you think about entering a new market like this one, how important are tools like ICD-10 coding and other ways to raise patient awareness for your path forward here?

Critically important. I think the establishment of that code just earlier this year -- actually last year has been critical in the identification of an additional 1,000 patients -- 1,000 patients. Obviously, it helps with the tracking. I think in this case, we need to marry it with a couple of things. One is patient finding associated with the diaspora of clinical symptomatology. I don't even think you need complicated AI algorithms on this one. There's a relatively straightforward set of parameters that one can look for, for instance, the U.K. Biobank that makes us a pool highly -- that yields a lot of ADH1 patients, let me put it that way. And the second is sequencing or some sort of genotyping within the context of the nonsurgical hypopara patient population. But I think all of that is doable. I also think the excitement from physicians around this molecule, given the data that we just published at Endo in chronic hypopara is pretty remarkable. If you think about HP -- chronic HP, which I think a lot of people do know that marketplace from Ascendis and other sponsors, number one, the opportunity is to have a more efficacious drug to 80% normalization, especially on urine calcium, I think is fairly unique in this space. The second is to have an oral drug. And the third is to have a drug that has an orthogonal mechanism to PTH replacement so that you might get around the downstream bone issues that arise with PTH administration. So all of those things, I think, could be quite profound for the chronic HP population and in general will drive excitement in and around this drug within the marketplace.

That's great. And so look, I know it's a little dependent on upcoming data. But once approved, how do you think -- how quickly do you think the market might develop here?

Great question. As a first-in-class launch, I think what we'll see initially is a bolus certainly amongst patients that have already been identified. And then real question is, and we look at launches like in XLH, for instance, the sort of best-in-class launches, how do we begin to develop the market beforehand. One of the things that we didn't have going into the Attruby launch was any sort of capital so that we could get medical affairs on the ground early, get a lot of the disease awareness on the ground early here, we'll have a better chance, I think, to develop the market prior to launch. So I expect that within the ADH1 community, at least that first few thousand patients that are identified would rapidly adopt the drug. And then after that, we'll have to see how we push into that news space, that's hard for me to tell.

Yes, that's fairly makes sense. Next, I want to touch on your LGMD2I program. I know you have a Phase III going on. Can you tell us a little bit more about how you view success in that program? Are you thinking about specifically endpoints, patient recruitment and fitting in the broader treatment landscape?

Yes, good question. For those of you that don't know, LGMD2I is not LGMD2B or 2D. I get a lot of questions on that. From the Sarepta activity, this is actually a much more common limb-girdle muscular dystrophy that shares nothing in common in terms of the path of mechanistic signaling. But rather arises again, uniformly through loss of function in an enzyme called FKRP. And the way the disease works is you have a lack of glycosylation against the alpha dystroglycan complex within the muscle. And so what the drug is seeking to do is to provide substrate back to the enzyme, which is loss of function but not full loss of function so that you might increase glycosylation against the ADG complex and, therefore, rectify the symptomatology in this condition. And once again, we're working on a first-in-class product. Importantly, it's a first-in-class product, that's a simple small molecule that's incredibly safe. There have been other approaches to this using gene therapy. There are problems you don't want to go too high on FKRP with it, and it doesn't seem to affect as many patients as you would like. But the small molecule approach yielded very interesting results in our Phase II, if you look at glycosylation in both the homozygous population, which is more common and the more deleterious heterozygous compound, heterozygous population, we saw an almost 100% increase in glycosylation of the ADG complex, which is remarkable. And we saw like by Pearson correlation 0.9 decreases in CK, which is a nice measure of muscle damage. And against the history of -- natural history of the disease improvements in things like ambulation and others, but I would caution that it was an open-label trial, so one never knows. The one thing we do know from the natural history of this condition is that it's very difficult to tell in a year whether or not you're improving against things like 100-meter walk time or modified North Star, things of that nature. It's very noisy. In fact, patients and KOLs in this space have termed this almost like Chinese water torture for the muscle. You get loss in functionality that's devastating and debilitating but it happens slowly over time. And so our discussions with the agency have focused on the potential to run a nested trial, one where we fully bear the responsibility of showing that this drug has meaningful impact for patients in a 2.5-year long or 3-year long trial. But that we have this early readout, which we expect sometime in Q4 here, where we look at 3-month impact on ADG glycosylation. We'll look at CK. And then we'll look directionally at some of the functional endpoints to see what the drug product is doing versus placebo. So that's the upcoming readout. It's fully enrolled. Last patient, last visit is behind us. I would say the enrollment pace was quite a bit quicker than we expected. And generally, in my experience, that suggests that the unmet need is quite high. Probably 30,000 patients in the U.S. is what the literature suggests and our stat gen team suggests, 4,000 in Europe. I think the opportunity size is roughly double exon 51 DMD looks like, something in that range.

That's great. It's encouraging to hear. Next, I want to touch on infigratinib. Can you tell us a little bit about your program there in achondroplasia and how you're thinking about the Phase III study?

Yes, sure. So just as a reminder, as many of you know, achondroplasia is the most common form of dorphism that uniformly arises from gain-of-function mutations in FGFR3. We have a drug that, again, targets the condition at its sourced by inhibiting FGFR3, but rather uniquely as compared to -- and this is a competitive space where the goal is to be best-in-class to some of the downstream mechanisms that only focus on one of the two signaling pathways, the MAPK pathway with the CMP. And so our goal was to obviously provide differential efficacy. And I think we've done that. The Phase II published in the New England Journal suggested that not only did we have meaningful improvements on change from baseline and average high velocity. But even more importantly, for this community, we were able to point to stating improvements in things like proportionality and others that I think this mechanism uniquely is able to deliver that others cannot. So that gives us the confidence to go into our Phase III and actually turn down the age of enrollment to 3. Oftentimes, you don't want to do that, you want to leave it at 5 or above to boost your point estimate on change from baseline AHV. But I think it's fairly well established that this molecule is going to be a superior certainly in terms of mechanism and I think, believe in clinical efficacy products. So then the question is how do we bring it to as many patients as possible as early as possible. So that's the Phase III design. Again, that's reading out first quarter of next year. And I think important to mention with this one, similar to ADH1 and actually a bit similar to LGMD2I, although the follow-on indication there in Fukuyama is quite small. Here, you've got what I think people clinically call a pipeline in a pill. There are many other skeletal dysplasias that are driven by FGFR3, FGFR2 dysfunction. And so the hypochondroplasia unmet need an opportunity is high on our radar. We are enrolling that Phase II as we speak and that has been enrolling ahead of schedule. I think, again, a clear message around the unmet need. And then at Endo, we published, I think, encouragingly on Crouzon, Pfeiffer syndrome, some of the other more deleterious skeletal dysplasias. And if anything, I hope, ultimately, the BridgeBio stands for is, we'll go after the big markets, but we'll go after the small markets as well when we have a really nice tool for it. And it's true in Canavan syndrome. It's also true in some of the smaller FGFR-driven conditions. And then the final thing I might add is here, you'll -- I think you should expect to see some competition from China. We profiled I think all three of the major FGFR "selectives" that I think mostly are like [ Tyra ]. And that means mostly, they're pretty dirty if you do a KINOMEscan. So I would expect to see announcements in and around someone buying them. I don't think they'll be incredible competition unless the safety profile is dramatically improved, which we don't see because many of these are hitting FLT4, VEGFR2 and a variety of other kinases that you'd rather stay away from. So I'd like our profile for the foreseeable future here.

That's great. And one thing to -- I know you mentioned some Chinese competition. There's a few other in U.S. and EU programs in development. Can you talk about how your FGFR differentiates from theirs as well? Is it along similar lines?

Yes. So there's really 2 dimensions to that. The first are the programs that are ahead of us, which are effectively CMP, either -- and I should mention, either once daily injections or once weekly injections. So I always like to focus on efficacy first. I don't think I would do a program just for convenience sake, although I think a single daily oral versus a single daily injection from the context of when you're born to whenever your growth plate causes is a pretty meaningful advantage, and we see that in our market research. But from the efficacy side, the reason to believe in the differentiation for our product is not only the clinical data that we've published. But also the fact that in targeting the condition at its source, what we're able to do is shut down signaling through both the JAK/STAT and MAPK signaling pathways that collectively are responsible for chondrocyte differentiation and proliferation. And -- so if you look at cellular models, if you look at the mouse model, if you look again in the clinic, there is literally no assay in which targeting that condition at its source doesn't lead to outsized advantages in terms of efficacy that's against any of the CMPs because the CMPs are effectively just touching the MAPK signaling pathway. The second concept has been more selective FGFR3 inhibition to stave off what people had discussed as a potential downside to broad FGFR21 and 3 inhibition, which is hyperphosph. But again, we saw no hyperphosph in our Phase II on a blinded basis, we're seeing very little hyperphosph in the Phase III. So I don't think that's going to be an issue for these programs going forward.

Great. That's good to here. And then looking beyond those, you have a number of other programs in two pretty meaningful baskets that are BridgeBio Oncology Therapeutics and Gondola. Can you tell us a little bit about those and what you're most excited for in those programs?

Yes, sure. So last year, we sort of took the step to deconglomerate if you will, the company. So investors could be more aware of some of the value that we were trying to provide patients and investors as well and make us more capitally efficient. Capital efficiency is a big deal to us. It obviously waxes and wanes as to how much investors believe we're capital efficient based on how much of the pipeline they value. I'll give you a good example. ADH1, should it be successful, will have gone all the way from our early studies through its Phase III readout in less than $200 million. All of our Phase IIIs inclusive of Attruby will have gone through all of their campaigns in less than $300 million. So I think that's pretty good capital efficiency for the types of opportunities that we're looking at, and I think there are opportunities to drive further efficiency into the pipeline. But nevertheless, it was important for us to kind of break things up. On the BridgeBio Oncology Therapeutic side, I'll let [ Eli ] talk about it. I know he's talking this week, but a super exciting array of products. The first 2 of which I think is the -- is kind of a first in class, if you will, direct inhibitor of G12C on and off, where they should be announcing data next year. And then the second is a first-in-class. There's one other company actually Bayer that has a PI3K alpha breaker, which is an exciting mechanism, both in terms of pairing with some of other mechanisms around KRAS inhibition or actually HER2 and in the context of potentially monotherapy. So that's on BBOT. And then in terms of Gondola, this is a super exciting effort right now, focused again on early-stage mendelian disease discovery where we've seen most investors sort of walk away from the space. And so I was telling someone earlier today, Howard Hughes Medical investigator will come over your house these days and talk about, well, this is my new idea about trinucleotide repeats and you can really form a lot of great, I think, high value, but early programmatic things today that you couldn't have maybe 4 years ago when competition was higher. So really exciting pipeline there, I think, helmed by a very exciting EPP Phase II readout that we expect again in the fourth quarter here. EPP as a reminder, is a disease of excess [indiscernible] It's both phototoxic as well as driving liver toxicity. And the goal is to tamp down [ PP9 ] levels. There is an existing approach, which limits the amount of glycine that goes into the erythrocyte or red blood cell that's been pioneered by a company called Disc Medicines. We think that there are several hurdles on that medicine inclusive of -- it takes a long time for it to take effect, weeks. PP9 reduction is 50% or less. And ultimately, there are toxicities associated with that compound that stem a bit from the GLit-associated mechanism, and you've seen that in the schizophrenia trials that were conducted before as well as the dizziness associated with their Phase II. So what's our goal? Our goal is more profound PP9 lowering in a matter of hours, not weeks, and ultimately, to have a safer side effect profile. And we're able to deliver those things. I think that's a huge and meaningful step forward for patients. So again, I think just another fingerprint of the R&D productivity that's ongoing in the Bridge ecosystem. Now hopefully, we can continue to bring to bear, if we can continue to show promising commercialization efforts with Attruby and hopefully, some of these other launches to come.

That's fantastic. Clearly, a lot to look forward to over BridgeBio.

Indeed.

That wraps up all the questions I have for today. I appreciate your time. Maybe I know you touched on a lot, can you just wrap it up with a brief summary of the upcoming milestones you have for everyone here.

Sure. Yes. Upcoming milestones are inclusive of ADH1 Phase III readout, inclusive of the LGMD2I Phase III readout. Both of those will be in Q4 of this year, inclusive of our achondroplasia readout Q1 of next year, and I would anticipate announcements around Phase III is launching in both hypochondroplasia as well as chronic HP with the [ encalor ] compound for the latter and the infigratinib compound for the former sometime in the first half of next year. So lots of activity just within the mothership of Bridge here.

That's fantastic. All right. Well, great. Thank you so much for joining us here today and walking us through.