Cullinan Therapeutics, Inc. (CGEM) Earnings Call Transcript & Summary

Welcome to the Morgan Stanley Global Healthcare Conference. I'm Jeff Hung, one of the biotech analysts. For important disclosures, please see the Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. For this session, we have Cullinan Therapeutics with CEO Nadim Ahmed and Chief Medical Officer, Jeff Jones. Welcome.

Good to be with you, Jeff. Thanks.

So for those who may not be as familiar with Cullinan, can you just provide a brief introduction?

Sure. Happy to do that. So we're a biotech company that really focuses on creating new standards of care. So as we think about bringing molecules and assets forward, we're looking at those things that are really going to be transformative rather than just an incremental step change. So I think that's the first thing I would say. And if you look at our pipeline, we've strategically built now 5 programs in the clinic that either address drivers of disease or harness the immune system across oncology as well as autoimmune indications. And by moving these programs forward, we now have a diversified pipeline across different modalities to address a range of tumor types as well as autoimmune indications. So on that same theme, autoimmune indications, we have CLN-978 which is our CD19xCD3 T cell engager or bispecific, that we think holds great promise to address a range of unmet need across a variety of autoimmune diseases. Very excited about that program. We have already announced that we're going to be moving forward in lupus as well as rheumatoid arthritis. So that's a program where we've pivoted into going from Cullinan Oncology to Cullinan Therapeutics. And now we are in oncology as well as autoimmune diseases, led by that program. And in terms of oncology, pipeline is moving along very well, recently at the ASCO meeting. We shared data for our program called CLN-619, which targets the novel MICA/MICB pathway. And there, we were able to show that CLN-619 was able to induce objective responses in patients who typically don't respond to checkpoint inhibition. So that was exciting for us. And then with zipalertinib, which is our Exon 20 tyrosine kinase inhibitor. We have guided to complete an accrual for our pivotal relapse study by the end of this year. So we're on track to do that. And in just about a week or so, we had an abstract accepted for oral presentation at the upcoming ESMO meeting. And then finally, I would say that as we guided our Q2 earnings. At the end of June, we have now $665 million of cash, giving us cash runway to 2028 so that we can continue to advance our oncology pipeline and just as importantly, unlock the full value of CLN-978 in autoimmune indications.

Great. You touched upon this briefly, but I guess before we dive into your pipeline, can you just give an overview of your strategic approach to drug discovery process and what differentiates it from other companies?

Sure. As we think about our approach, we call it modality-agnostic targeted research and we're trying to bring forward molecules, as I said earlier, that are going to be very transformative rather than stepwise incremental changes in the way we approach a range of diseases. And so modality-agnostic targeted research means that our discovery group starts their efforts by identifying the highest impact targets, and then we address the modality to address those targets. So in other words, for us, it's always target first and modality second, which can be quite different to our peer set. And so that's an important aspect of where we see ourselves as differentiated. And then throughout the discovery process, we have a very high go/no-go bar in terms of moving programs forward through what we call our thriller or killer experimentation approach. So as the name suggests, if we get the killer result, we kill the program and we reallocate resources. When we get the thriller result, we think about how can we double down on our investment and move the program even quicker. And so by taking this approach of a very high bar to move forward, we try to make sure that we bring forward only the most promising molecules into the clinic. And so that way, I would say that we do have a very differentiated approach to the discovery process and making sure we only bring forward molecules that have the opportunity to either be first or best in their class.

And you mentioned that 978 has basically expanded Cullinan Oncology to Cullinan Therapeutics. Can you just talk a bit about the expertise you have in-house in the autoimmune space?

Yes, sure. I think sometimes a molecule can drive your strategy. And I think with CLN-978 in the CD19 space, it's a program that originally started out in lymphoma. And then around that time was when all of the CAR-T data started coming out for lupus, especially in Germany from the Erlangen Group and George [ Shultz ] publications. And so we felt that there was an opportunity here in the autoimmune disease space given that CD19 was the same target of the initial CAR-T cell therapy data. So that was of high interest to us. At the same time, we've always been a company in the immuno-oncology space. So if you look at our pipeline, most of our molecules actually harness the immune system. At the same time, in terms of scientific progress, the biology of oncology and immunology has continued to converge. And so for us, expanding into immunology was a very natural adjacency and an excellent strategic fit for us. Secondly, in our company, we already had scientists and drug developers who had prior immunology experience. So we're able to tap into that. And then at the same time, Jeff and his team have been busy recruiting external expertise so that we can build out our immunology expertise, especially in the areas of clinical development, research as well as regulatory as well. So that's the story behind how we expanded into immunology. And I can tell you there are a few times in your career where you get to say to investors, look, we believe in this program so much that we're going to change the name of the company. So that's pretty cool to do as well.

Great. Well, let's dig more into CLN-978. Can you just talk about this asset and how it's differentiated from other autoimmune disease candidates like CAR-Ts and other T cell engagers.

Sure. I would say the kind of -- the key take-home message is we think it's a combination of modality and target that's really important in this space. And so in terms of optimal modality and target, so remember, I spoke about how we addressed target first on modality, second, CD19, we believe, is the optimal target for rest autoimmune diseases. It's what we saw with the data from Germany. And we also believe that T cell engagers are the optimal modality. So CD19 plus T cell engager, we believe, is the best approach to address autoimmune diseases. And if you think about cell therapy, cell therapy is the space I worked on in the past and were involved in the launches of 2 cell therapies actually in the U.S., in myeloma and lymphoma. And I think cell therapy has clearly been a transformative treatment in oncology, [ especially in ] hematology. I do think the risk-benefit equation is a little bit different when you go into autoimmune diseases, different patient population, younger patient population. And there, I would say that with a T cell engager, it is very differentiated from CAR-T cell therapy, right? So with CAR-T cell therapy, you have the complexity of manufacturing, logistics. As a patient, you can only receive it if you go to a CAR-T certified center. There's a safety profile to contend, many of you remember in the past few months, the FDA has put a black box warning on all approved CAR-T therapies around the risk of secondary cancer. Risk of CRS, neurotoxicity. With CAR-T therapy, you have to have a lymphodepleting chemotherapy regimen, which induces its own risks, especially as you think about younger patient populations like lupus, where the ratio of female to males is 9:1, and the risk of infertility is quite high. And so our view is that with a modality like T cell engager. CAR-T has led the way in terms of establishing important proof of concept, but it's going to be difficult for CAR-T to be able to reach the masses of patients in the autoimmune disease space, whereas a T cell engager where we can take the treatment to the patient has the opportunity to be applied across autoimmune diseases and across multiple patient segments. So I think that would be our view on CAR-T therapy in the target space. And as we think about other T cell engagers, many of the targets currently under consideration include CD20, CD19, BCMA. We believe CD19 is the optimal target given the breadth of compartment of the B cell maturation complex that it covers. So from the early B cells all the way to mature, mature B cells, which are often responsible for the production of these pathogenic antibodies that cause these diseases. And so CD19, going back to what I said earlier, we believe is the optimal target and even within the CD19 T cell engager space, we have a molecule that we believe is very well differentiated. It has a very small molecular size compared to the other CD19 T cell engagers in development, supported by the earlier data this year with another T cell engager published in rheumatoid arthritis as well as systemic cirrhosis, where we saw very high levels of efficacy, deep B cell depletion, deep tissue penetration. So that continues to support CD19 as a target. And the way our molecule is being constructed, it's been constructed to have very high affinity for the CD19 antigen, which is especially important in autoimmune diseases where you start to see CD19 levels lower in the more mature end of the B cell compartment, including plasma blood cells, plasma cells, short-lived, long-live plasma cells. So it's important from that aspect. And so the affinity for CD19 with our construct is picomolar versus nanomolar for CD3. So we believe that also gives us a broader therapeutic index, a broader cytokine window as well. So I think, again, I would summarize by saying CD19, we believe the optimal target T cell engagers is the optimal modality. And within that space, we feel we have a very well-differentiated molecule. And as I said, we're moving forward with lupus and rheumatoid arthritis as our first 2 indications.

Great. Well, last night, there were 2 letters in the data that was published in the New England Journal of Medicine on the clinical activity of daclizumab in patients with refractory autoimmune diseases. What are your takeaways from those cases.

Jeff, do you want to add on that?

Yes, sure. So very timely that those appeared given our aspirations for T cell engagers in autoimmune disease. And maybe just to reiterate a little bit about the BCMA target. As Nadim was sharing, BCMA is another potential target for autoimmune development. Many people think of it primarily as a plasma cell directed target since BCMA-directed therapies are approved right now in multiple myeloma. But BCMA is also expressed on many mature B cells. So BCMA-directed therapies will deplete the entire continuum of plasma cells as well as mature B cells. So what was reported overnight were initial clinical experiences with one of the approved anti-myeloma drugs, a BCMA T cell engager from JNJ, teclistamab or TECVAYLI by [ brand name ]. And in one paper from the group at the University of Erlangen, real pioneers in T cell redirecting therapies for autoimmune disease. They treated 4 patients with a mixed group of autoimmune diseases systemic sclerosis, inflammatory myositis, Sjogren syndrome and one patient with rheumatoid arthritis and demonstrated really profound peripheral blood B cell depletion, prompt declines and auto antibody titers were measurable as well as marked improvement in clinical symptoms in this group of patients who were very, very refractory. Unfortunately, there were some downsides. While they didn't have typical class-related side effects that you might see with T cell engagers like high-grade CRS or ICANS, which is very reassuring. They did have 4 episodes of infection among 3 of the 4 patients. And this reflects what Nadim was alluding to, that BCMA, while it's a good target in many respects is -- has some liabilities and that it's expressed on long-lived plasma cells, the cells that are responsible for maintaining our immune response to prior vaccination, our humoral immune memory. And so when you deplete those cells, you provide a significant impairment to the immune system. So these patients became very low in their infection-fighting immunoglobulins and we have heard anecdotally that they've required subsequent revaccination for common pathogens that we would be immune to from our childhood vaccination series. In the second patient -- second paper, it was a very detailed characterization of similar teclistamab treatments, again, at the approved dose in multiple myeloma, although in a slightly modified schedule, this time, a very refractory lupus patient and one thing I would mark about this lupus patient was that unlike the patients that you might have seen reported in some of the CAR-T academic series, this patient was profoundly ill, refractory to every approved therapy in SLE had not only advanced kidney disease, but also advanced arthritis, skin disease and an immune-mediated anemia that was active at the time they started treatment. 6 weeks after receiving treatment with teclistamab, the patient had not only depleted B cells and antibodies, but all symptoms had resolved consistent with the remission in a disease where remissions have not typically been attainable with available therapies, a very profound results. But unfortunately, like that, other patients the effect on the long-lived plasma cells was such that the polyclonal immunoglobulins zeroed out, the patient had to receive infusions of donor immunoglobulins, IVIG, to prevent infection. And despite those interventions, still developed both pneumonia and sinusitis. So I think it gets -- a key takeaway here is that a T cell engager much like the CAR-T data that has really enthralled people for its potential in autoimmune disease. But now a T-cell engager, an off-the-shelf antibody is capable of delivering a similar clinical outcome but as Nadim says, it's not only modality that matters. So while we would say it underscores the potential of T cell engagers it also reinforces our contention that CD19 among the available targets for exploration and autoimmune disease is likely preferred to either CD20 or BCMA.

Great. Can you just talk about your choice of lupus and rheumatoid arthritis as your 2 lead indications and what data that you've seen or generate that gives you confidence for these indications?

Yes, I can start and Nadim, please jump in. I think for SLE, it is -- if you think of T cell engagers and CAR-T like we do as T cell redirecting therapies, so bringing a T cell immune response to eradicate the cell of interest, your B cells. This has been most convincingly established in SLE as a treatment that through deep but transient B cell depletion, you can achieve a durable treatment-free remission. And for that reason, we think that it provides an important benchmark for any therapy that's going to be developed in the space. But from a clinical standpoint, as I was just suggesting, many patients with SLE and there are a substantial number of them, maybe 160,000 living with the disease in the U.S. who exhaust available therapies, which are primarily symptom, not disease modifying. So the potential to develop disease-modifying therapy with the potential to put patients into a treatment-free remission is a really remarkable advance in this disease. And for that reason, both the size of the opportunity clinically, commercially as well as the initial proof of concept for B cell depletion that leads to the SLE choice. For RA, similarly, a very large indication, many approved therapies, most patients will ultimately cycle through them and need additional options for effective therapy. And in the case of RA, the proof-of-concept data has actually been shown not with CAR-T, but with the T cell engager blinatumumab approved for acute lymphoblastic leukemia, but that drug in a series of 6 patients, again, from investigators from Erlangen showed really marked clinical responses and similar features of the immune reset that has been shown after CAR-T and other autoimmune indications. So for that reason as well as for what we've disclosed as an opportunity to work with these world's leading investigators at Erlangen and in an additional group at Rome at the Gemelli Hospital there. We have elected to pursue RA.

Now in your initial studies for RA you're focusing on refractory patients, will you be focusing on specific subgroups? And then if so, like what would your expectations be for each.

So maybe I'll take SLE first. So in the case of SLE, many of you may be aware that some companies have pursued a strategy focused solely on lupus and nephritis. We've taken a different approach in part because we think a T cell engager has potential broader applicability in a broader patient population, but we'll be focused on patients with general without respect to specific organ manifestations. But with moderate to severe disease as measured by the common disease assessment index, the SLEDAI, a SLEDAI score of 8 or higher connoting moderate to severe disease. And I think there, the focus is on rapidly establishing proof of concept for the modality as well as in terms of efficacy and pharmacodynamic effects as well as an appropriate therapeutic index. These patients will be treatment experienced. That's born both of identifying a patient population in which there's appropriate risk benefit. And that will also hold true for RA, where the target population would commonly be classified as the difficult-to-treat patient population, many of whom will have already failed multiple disease-modifying agents for their disease.

Great. And what can you share on the dosing ranges or schedules that you're going to evaluate for the 2 indications? And would you expect them to be much different from each other?

Well, first, what I would comment is we've announced these projects. We first announced SLE. We remain on track to file an IND in that indication before the end of this quarter and are pursuing in parallel our project in RA. And there's no insight with regard to dose or schedule from our SLE project that gates the second project in RA. I think that to the extent that we are trying to achieve a similar degree of B cell depletion in both indications the dosing strategy and schedules that we explore or are likely to be similar, although we've not yet disclosed that. We don't want to get ahead of our U.S. regulatory discussions.

And so as you run these studies and look at the Phase I in lupus, what do you see as kind of the bar ultimately in terms of efficacy relative to CAR-Ts.

Say that again, Jeff.

I was just saying as you continue to advance these programs into for lupus, like given the potential advantage of like T cell engagers, where do you see as the bar and efficacy?

Yes. I'd say we've had a lot of discussions with investigators even before we took the strategic decision at the enterprise level about this asset. And I think one thing that's been very clear is that a T cell engager does not need to achieve equivalent results as CAR-T in order to be successful. There's this huge opportunity gap that exists between available therapies and what has been reported for CAR-T. And in those discussions, investigators would tell us, if we demonstrate disease-modifying benefit, if we were to achieve remissions in a fraction of patients that would allow them to discontinue their chronic immune-suppressing medications then we likely would have had a clinical success. And particularly, if that comes with a safety profile where there is no higher than grade 2 CRS, probably low single digits maximum and limited risk for neurologic toxicity. They would view that as a very compelling clinical profile for widespread adoption.

Yes. I would add to what Jeff just said. I think the bar for widespread adoption of CAR-T across the [indiscernible] of autoimmune disease patients is very, very high. Whereas we have a T cell engager where you can take the treatment to the patient. Just to be clear, we're gunning for exactly the same efficacy that we've seen with CAR-T. But what we've been told by experts is give me something that is significantly better than my current standard of care which is essentially addressing the burden of symptoms rather than addressing the underlying pathophysiology of the disease. This is why we're so excited about this program.

And I know it's still a little bit early, but maybe you could just talk about how you think about 978 potentially fitting into the treatment paradigm in terms of sequencing amongst the autoimmune therapies in the future?

Yes. I think, look, one of the aspects of this modality, which I think started off with the cell therapy data is, we haven't seen these kinds of durable treatment-free remissions where patients can come off their background therapy that significantly encroaches upon their quality of life. And so we think CLN-978 has the opportunity to be a really disruptive technology in this space. So we think about sequencing a little bit different in the sense that if you take lupus as an example, one of the key complications of lupus that can lead to ultimately fatality is when you get end organ damage. So if you're in a position where you can actually prevent end organ damage by giving the treatment earlier, I think there's definitely an opportunity to address a significant unmet need there. And so that's kind of how we're thinking this could -- I mean, obviously, the early studies were [ studying ] later stage of disease, plan to move up earlier and then going back to the discussion we had, we believe that CAR-T certainly could have a role in autoimmune diseases, but probably in sicker more refractory patients. So you can envision a scenario where patients receive T cell engagers first, for example, and then maybe CAR-T cell therapy later down the line, for example.

And I know this also maybe did you want to...

No. Although I will say that one of the remarkable things about T cell engager data in oncology indications, is that T cell engagers can rescue patients from CAR-T failure. And so I still think that there is incredible potential for T cell engagers and like Nadim, I'm not ready to give up on CAR-T-like efficacy, we're aiming high.

Great. And I know this is perhaps premature to ask, but maybe you can just talk about your thoughts of 978 and other autoimmune disease, is the plan to expand 978 into other indications as well? Or would you do that through other pipeline candidates?

Sure. Yes, that's a great question. Look, the first thing I would say is we have declared lupus, we've declared rheumatoid arthritis, additional activities are part of kind of our internal intensive discussions, I would say, I do think that the financing we did earlier this year, heavily oversubscribed, almost $300 million gives us the opportunity to do more things in parallel rather than sequentially. And so we continue to think about additional autoimmune indications that we could explore. But starting probably with CLN-978 first I think with our oncology pipeline, most of those molecules probably are more cancer specific. And at the same time, we have a very active BD team that continues to search for opportunities outside. Again, high bar for BD because we do want to make sure we maintain cash runway in a pretty volatile market. So it's just a very exciting time for us as a company.

Great. Let's shift to CLN-619. You recently presented updated monotherapy and initial combination data at ASCO in June. Can you just walk us through the data and what you saw.

Yes. for folks less familiar with our anti-MICA/B program, maybe just a few words on the mechanism of action. So MICA and MICB are stress-induced ligands of NKG2D, so for stress cells, they engage cells of both the innate and adaptive immune systems that express NKG2D. But in oncology, across tumor types that are known to upregulate MICA and MICB, the ligands are cleaved in the tumor microenvironment, allowing the cells to be closed from the immune response. CLN-619 binds near the site, but proteolytic cleavage reestablishes MICA/MICB on the cell surface. We've shown this in our own translational studies allowing reestablishment of an immune synapse between NKG2D and MICA and MICB, but also inducing ADCC since the antibody is Fc competent. So in our presentation at ASCO this year, we updated data for our monotherapy dose escalation experience now showing that in a larger group of a total of 44 patients, a very favorable safety profile, but probably most remarkably in the 29 patients in whom response was able to be assessed, we saw a clinical benefit rate of 41%. And not only 3 objective responses in patients, 2 of whom had failed prior treatment with PD-1, but also in an additional group of tumors including a patient with platinum-resistant ovarian cancer who achieved stable disease extending for longer than a year as fifth-line, sixth-line therapy. As well as an estrogen receptor positive breast cancer patients who had a similarly extended duration of stable disease. New in our presentation this year was data from a companion dose escalation in combination with pembrolizumab. And there, we saw a similar sort of takeaway objective responses to the combination in patients who would not typically be expected to respond to PD-1 therapy as monotherapy, so there in 22 patients total, 18 were response accessible, and we saw 3 objective responses, one in gastric cancer, which is PD-1 sensitive but the other responses were in a patient with ALK-rearranged non-small cell lung cancer as well as a second patient with EGFR-mutated non-small cell lung cancer. And you'll remember from even evening news TV ads that those are clear exclusions from the label indications for PD-1 in non-small cell lung cancer. So we're very gratified to see across both arms of the trial that the drug appears to have broad clinical activity that it appears to be quite safe with the most frequent adverse reaction being infusion-related reactions following the first dose and about 20%, all but 1 grade 1 or 2 severity, mitigatable with steroids. But I think the activity in patients who've relapsed after PD-1 or who are not expected to respond to PD-1 is very intriguing and has really inspired a lot of interest amongst our investigators. So we are currently pursuing the program in disease-specific expansion. We're exploring both monotherapy in combination in endometrial and non-small cell lung cancer. In the case of non-small cell lung cancer, we are prioritizing enrollment of oncogenic driver mutation subtypes of non-small cell lung cancer. And year at ASCO, we announced plans to explore the mechanism of action with chemotherapy since we know chemotherapy can not only promote influx of immune effector cells but also promote MICA/MICB cell surface expression. So the first indication in that project will be patients with platinum-resistant ovarian cancer.

Great. Now in the first half of next year, I think you'll be reporting initial data from endometrial and cervical cancers.

That's correct. And we remain on track with that guidance.

And so how do you think about the bar for success for those data? And what would you consider to be good results?

Yes. So I think the case of endometrial has evolved over the last year. In relapsed patients, PD-1 was really revolutionary. It was the first drug that had shown robust activity in relapsed endometrial cancer in several decades. And now it has moved up to the front line in combination with chemotherapy, which leaves a significant unmet need in patients who will now be progressing after PD-1 plus chemo in the front line. So the utility of retreatment with PD-1 there is not established. I think there, the existing standard of care would be monotherapy with chemo, where the expected overall response rate is approximately 15% and never durable them more than 4 to 6 months. So their success, particularly for monotherapy, would be a 30% response rate, 6 months durability and particularly with the favorable safety profile that we've demonstrated thus far.

Great. Maybe in the last couple of minutes, just one last question on zipalertinib. I think at the beginning, you mentioned that -- there's -- you have an abstract presentation at ESMO. Maybe you can just talk a little bit about that, what we should expect to see at ESMO?

So for exon 20 insertion mutation non-small cell lung cancer, amivantamab is now a fully approved drug for that indication. And developing drugs in that space, it's really important to understand how your drug compares or can salvage patients following an approved standard. So this year at ESMO, we will present data from one of the registration cohorts of our ongoing second line plus registration study, the REZILIENT1 study, demonstrating the clinical activity of zipalertinib after prior treatment with amivantamab, either as monotherapy or in combination with chemo. Preliminary results from that, that we shared at ASCO this year demonstrated that we're seeing comparable activity in post amivantamab-treated patients as we did in patients who were amivantamab -- amivantamab-naive, but chemo pretreated. And the safety profile is also holding up to be quite similar. So we think that this is important data clinically in this difficult-to-treat patient population but is also important for our regulatory aspirations for accelerated approval.

Great. Well, let's leave it there. Thanks so much for your time.

Thanks everyone. Appreciate it. Thank you.