enGene Therapeutics Inc. (ENGN) Earnings Call Transcript & Summary

Thank you. All right, good morning everyone, and welcome to the 2024 Morgan Stanley 22nd Annual Global Healthcare Conference. We are very excited to have Ron Cooper from enGene to kick off the conference. Let me just read a quick research disclosure before we get started.

Please visit www.morganstanley.com/research disclosures. It's an important year for enGene, Ron. Before we dive in, can you give the audience a quick intro to the company and a bit of the background on your decision to pursue non-viral gene therapy?

Great. Well, first of all, Judah, thanks for your invitation to be here. Great to see you. It is a pretty exciting year for enGene. So, what is enGene? enGene is a company that looked at the challenges of viral gene therapies and said, "I think we can solve some of these challenges." And those challenges being package size, redosability, and the manufacturing challenge. So enGene was founded to build non-viral gene therapies. And then, you know, through the discovery process, translated a product called detalimogene, which is the first non-viral gene therapy that we are developing for non-muscle invasive bladder cancer. detalimogene has been studied in the LEGEND program in Cohort 1, which is a pivotal program, 125 patients, which is one of the larger programs. So we're having a pretty exciting time in the company. In this next quarter, we'll have some data that will mature, some durability data that will mature. We plan to meet with the FDA. We plan to file the detalimogene in the U.S. and expect a potential approval in 2027. And sitting with $266 million in cash, we're well capitalized to achieve all of those things.

Okay, great. Great, so like you said, you're developing detalimogene. The indication is BCG-unresponsive, non-muscle invasive bladder cancer with CIS. So, Ron, can you tell us a little bit about the burden of this disease, a little bit on the epidemiology, how many patients are diagnosed, how they're managed, and really what the unmet need is that you're looking to address?

I was shocked when this opportunity presented itself. The treatment in bladder cancer, actually, particularly non-muscle invasive bladder cancer, is pretty poor. The definitive treatment was removal of your bladder. So the radical cystectomy, and then when I learned more about radical cystectomy, it's a four to six-hour surgery, multi-organ, 5% to 15% mortality, and horrific morbidity as well. Individuals landing with an ostomy, loss of sexual function. So, treatment's not very good, right? Now, when you think about the epi, there are about 90,000 in the U.S. in the incident population, about 90,000 individuals have bladder cancer. 80% of those are non-muscle invasive bladder cancer. And then within that, it's estimated somewhere between 20,000 to 40,000 individuals each year have non-muscle invasive bladder cancer that is resistant to BCG. So it's a pretty significant patient population. This is the #6 cancer in the United States. So it is a relevant cancer. And the FDA put out guidance to say, "if you did a study about it,..."

100 patients or so, open label, that in fact you can get an approval. So we're actually at the dawn of something very special and exciting in the management of bladder cancer. Okay, great. So in recent years, you know, we've gone from having very few therapeutic options to a handful spanning different mechanisms and practices still evolving, but we, what we've seen so far as to how urologists are adopting these therapies, you know, how are they adopting kind of these newer options that are being made available to them? Again, I think we're at the early stages of these new agents being available.

And part of the challenge is when you look at the market overall, let's call it 20% to 25% of the patients are in academic institutions, and let's call it 75% to 80% are in the community. The newer agents, while very good, are, come with some challenges. And they come with challenges in that they require multiple pre-washes. The intensity is very high. It requires post-treatment activity. It requires infrastructure. And they just don't slide easily into a urology practice. Those practices have a lot of resource. Academics have adopted them quite, you know, quite significantly. I would say that the community area is almost barren. So you think about community urologists right now, what do they have? They have BCG, if they can get it, right? And then they have Gemcitabine, which they can use, but there's some questions about efficacy, and it's not really financially viable. And then of the new agents, Gemcitabine on the pretzel may or may not be viable. So there's just not a lot of choices for these community urologists.

And that's where detalimogene can really make a big difference. Got it. So with these dynamics in mind, and clearly kind of different dynamics between academic centers and community urologists, is there an estimate of how big you think the non-muscle invasive bladder cancer market could be? I think in the past you pointed to the multiple myeloma market. That's maybe a relevant precedent, but what does history in that therapeutic area kind of tell you where NMIBC might be able to go?

I think it's a fantastic analogy, and I think it's something that Wall Street needs to really start to pay attention to. With the advent of new agents, what you get is patients avoiding that horrible removal of their bladder. Nobody wants to have an organ removed, right? And they will take, market research says, right now they'll take three or four lines of therapies at least. That's a big change. So what does that do? That starts to boost the prevalent population. So let's go back to the analogy of multiple myeloma. When Revlimid was launched, multiple myeloma was a $1 billion market. Now, if you look at multiple myeloma with, you know, over a dozen new agents, it's a $20 billion market. And we're now working to a point of where it's almost functional cure. What an advance for these patients. Well, I'm hoping we have the same sort of advance for patients here in bladder cancer. And right now, you know, the agents that we have are useful, but some of them are difficult to use. But every single one of these agents, if you look at the durability of the products, they range...

...between 40% to 50%. So what does that mean? At the end of a year, half the patients need another medicine. So medicines like detalimogene can make a really big difference. Okay. Great. Okay, diving a little deeper into detalimogene. Can you tell us a little bit more about the asset, you know, the construct and delivery vehicle? And can you touch a little bit more on your the DDX platform and how it factored into detalimogene?

So detalimogene is quite simple, but quite elegant how it's put together, because actually it starts off with the simple generic plasmid. We have two RIG-I genes and IL-12. Then we take, and this is where the platform comes from, the secret sauce is our proprietary sugar, DDX. They are mixed together in an in-line manner, and then a proprietary pegylation occurs to create these nanoparticles. What's fascinating about detalimogene is that all of the ingredients that I just described to you are readily available or inexpensive, and we're able to put them together in a proprietary manner. The result is we have a product that has already gone through our FDA validation batches. We're manufacturing at scale. So this is a product that our detalimogene that is easy to handle, can be stored in a regular fridge or a regular freezer, but we should have the lowest cost of goods of all the immunotherapies.

Okay, great. And and you've reported a good amount of data from your pivotal cohort in the LEGEND study thus far. Maybe just from a high level, what have been key takeaways from the interim data that we've seen so far that you'd highlight?

Yes, I think we're excited to show that detalimogene is an active and useful product. The primary endpoint for approval in this category is complete response rate at any time. Ours is 54%, which is in the range of approvable products. The next thing the FDA looks at is safety and tolerability. So being a non-viral gene product, quite safe, as described, sitting in your refrigerator. But from a tolerability standpoint, we seem to have one of the lowest levels of AEs, and in particular, if I draw your attention to treatment interruption, or treatment discontinuation, a real measure of are people taking the medicine. Ours is 2.4%, very low. So we're trending towards best-in-class handling, best-in-class, you know, tolerability. Also below that, what was interesting is that over 90% of the patients responded within the first three months, so they responded very quickly. If they didn't respond, less than 3% progressed, so very, very little risk of using the product early, and you'll know very quickly if it works. And what we're waiting for is our data to mature from a durability standpoint. We have very early 12-month data, 12-month landmark data, and we have very early durability, the patient, the percentage of patients that are durable 12 months and beyond, and that's what we'll get later this year.

Okay, great, so speaking of that, you know, you've got it to that 12-month data later this year, and it sounds like the BLA submission could come after that. So what are you hoping to see in that update? What profile do you think would support regulatory approval in that update?

Well, you think about what does what does the FDA look at? Yes. The FDA first looks at the risk-benefit in any category, right? So what's the risk for? Thus, first of all, as I said to you, trending towards best in class tolerability, trending towards best-in-class safety and handling. And the risk is this is a new a new approach, right, a new platform. The FDA likes to have, they've approved four different agents, types of agents, this would be totally different. So that's on the risk part, which I would say relatively low. Then the primary endpoint is CR anytime, that's heavily weighted. Ours is 54% in line with the other. Now what the FDA is looking for is some durability data. Right. So, and, you know, because if you have a 54% CR anytime and you have three months of durability, it's not very useful. But if you have something, you know, like the majority of the patients approach a year, yeah, that gets competitive. So we'll have that data, the 12-month landmark data, in the second half of the year, not as much of the 12-month durability data. That package will go in together and that will form our planned BLA initiation.

Okay. And I think you've said you have a planned FDA interaction later this year, so ahead of the BLA. So is there any...

...you can give us into maybe key points you'll be looking to discuss with the agency in that meeting? Then, again, I guess just how much of this 12-month data do you think you'll have or do you think would be helpful to have for the meeting? Yes, so the meeting itself, we covered two topics. We covered manufacturing and clinical. So we, the FDA has given us CDRP, which is a special program for manufacturing, so we're always in dialogue with them, but we will go and ask them a couple of questions about our manufacturing, is it sufficient? And then on the clinical stuff, it's pretty simple.

Does the FDA believe we have sufficient enough data to initiate the filing? And I think at that time we feel pretty confident that we'll have a sufficient amount of data to be able to do that. Okay, and I think you talked about alignment with FDA on the SAP to potentially exclude some patients for the FHIC analysis. Can you remind us of the context for that discussion and give us a sense of the range of potential outcomes on exclusions? Are there certain patients you're fairly confident could be excluded? Where does that discussion stand?

Yes. So with any pivotal program, you have a discussion with the FDA on the statistical announcements, quite normal. If you see within some of the other products, they have a publication # with X, right, and in their label Y. This is the process that we're under. We've made a proposal to the FDA. The FDA has come back to us. So we're in that back and forth period. I think our upcoming pre-BLA meeting will help clarify that further, but we would expect that our final label will have less than the 125 patients that we've enrolled. And again, the 125 patients makes it one of the largest programs. So to lose some patients is not going to have much of an impact.

Okay, that's helpful. And then maybe just one more on the regulatory front, and we've discussed this before, but with the evolving treatment landscape here, you know, and organizational changes at FDA, you know, there's more and more talk about single-arm trials, and, you know, maybe the sentiment is that is more amenable to those these days versus maybe a few months ago. But I guess just any thoughts on kind of trial design and how the evolving nature of staffing at the agency could impact receptivity.

Yes, actually our interaction with the FDA has been nothing short of phenomenal. Yeah. Right, so what do I look at? It's not that long ago when Lexo was improved, right? So the path is still there. The second thing is, if you look at other companies that are coming into the space, they've been very clear with them that their studies are not second-line studies, they're third-line. So ours is BCG, then our product. Any new product is BCG, a new product, and the third product, so they've been pretty clear with that. I guess then the third thing is I look at our level of engagement, and the FDA, you know, does not hand out very easily things like RMAT designations, CTRP. We've had the same project managers, we've had the exact same clinical reviewer. I feel pretty confident that we deliver the package that we're planning on delivering. We're in very good shape with that.

Okay, great. And maybe just transitioning to the potential commercial launch for detalimogene. You and the team have done a lot of interesting work to understand the market and the unmet need here. So if we think about detalimogene's unique profile, how is it positioned relative to other treatments, and how does that factor into your launch strategy?

Well, I think you have to step back at the market first of all, right? So the market is, let's call it 25% academic, 75% community. Detalimogene was designed for community urologists. And in fact, when you survey, do market research for community urologists, what do they say they want? They say, "Well, we want something that's efficacious, that our patients will take, that's tolerable. And that's easy to slide into our practice." That is the detalimogene profile. With a 54% CR rate at any time, it shows great efficacy. With a very low treatment interruption or discontinuation rate, patients will stay on the medicine. And in fact, detalimogene is probably even easier than BCG to integrate into the practice, given that it'll sit in the freezer for what we expect to be years, and in a regular fridge for many months. It's not going to require much resource from a staffing perspective, because with detalimogene on its own, there are no pre-washes. You don't need to have urologists administrate it. It needs to be a medical professional, reach it in the freezer, mix it, and still send the patient home. So that, to me, is a pretty compelling proposition for those community urologists who have very few options.

Okay, great. So maybe just diving a little bit deeper into that, is there further segmentation you'd highlight between...

...of academic and community practices? Are there different levels of receptivity to detalimogene versus maybe a more onerous treatment in the work that you've done? Yes, so our market research shows that there's a unique position for detalimogene. So if you, you know, it's easy to characterize all urologists the same, right? Then you can say, "Okay, let's split them by academic and community." And that still was still fairly simple as well. Within the community, we can go down even further to find segments that are particularly attracted to detalimogene. So there are practices. So if you look at it from a numbers perspective, that's 25%, 20% to 25% academic, 75% to 80% community. And within that, we've identified over 40% of the practices that have unique attributes that detalimogene would actually solve a big problem for us. And these are resource-constrained practices, economically focused practices where the profile of detalimogene differentially could be very special there.