H. Lundbeck A/S (HLUNB) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by. Welcome to the Lundbeck Investor Telephone Conference. I'm [ Moat ], your Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions]. The conference must not be recorded for publication or broadcast. At this time, it is my pleasure to hand over to Johan Luthman, EVP Research.

Thank you very much, and welcome, everyone, to this investor call, which is happening in relation to a readout that we had very recently with our Lu AF82422. It's an alpha-synuclein antibody. I will come back to the mechanism action a little bit more in detail in the coming slide, but it's disease-modifying approach to multiple system atrophy, and I will also describe the indication a little bit more. But before I go on, I'd like to remind you about the disclaimer that this is, of course, a presentation of headline data from a very recently readout study. So any forward-looking statements that I would have are made on behalf of Lundbeck, of course, but we have not gone through details of the data, and I cannot provide full granularity on what we're having from this study. So just a few words about the multiple system atrophy. It's a horrible disease. I think I can start by saying that. It's a very rapidly progressing neurodegenerative disease. It has no treatment to offer today. Symptomatic therapies that are used are really primarily off-label use of various therapies. It's a disease with many symptoms, but it's a disease that leads to degeneration of nerve cells in the brain. There are actually 2 forms of the disease, a cerebellar form and a parkinsonism form. The parkinsonism form is, as you hear from the name is similar to Parkinson's disease and may actually initially be misdiagnosed. While the cerebellar form is, if anything, sometimes misdiagnosed with ataxia type of diseases, but both of them are defined by a very, very clear pathology at postmortem. It's an orphan disease, but as I often say, it's a fairly common rare disease. It's one of the more common diseases in the rare disease field, but it's, as I said, no treatment around. So it's by definition, an orphan disease, if I'm viewed by most regulatory agencies. And I'd like to recall you that we already have this designation in Europe for the molecule and we also have what is called sakigake in Japan for this molecule. The drug, of course, is a disease-modifying mechanism. And I'd like to go through a little bit more in detail how we think this molecule works. This is based on many, many years of research on alpha-synuclein as a pathogenic mechanism in both Parkinson's disease and multiple system atrophy. In fact, multiple system atrophy is a more specific disease for alpha-synuclein, Parkinson's disease often comes with more comorbidities. And in this particular disease, we have a pathology that's quite different from Parkinson's disease. The alpha-synuclein aggregates, are actually affecting oligodendrocytes, which are the insulating cells building the conduction sort of myelination around nerve cells in the brain. And that, by affecting those cells, you have a retrograde effect on the nerve cell itself and it's dying off. What we're trying to do here is to basically mop up the release of alpha-synuclein aggregates by binding with an antibody 2-dose aggregates, we actually enhance the clearance by the end of -- by the phagocytotic system of the brain, remarkably to clear away those aggregates that are decorated with the antibody 422. It's an IDD-1, which means that it's actually actively helping the brains remarkably have to clear the alpha-synuclein aggregates. So it has an active Fc region, which is another clearance mechanism, shown to be quite important to really enhance the efficiency of the clearance. This particular molecule 82422 was developed by Lundbeck, but it was initially a joint research, a collaboration between Lundbeck and Genmab, but the molecule has been taken through early research and development by Lundbeck. So this is the study that we just had a readout the so-called AMULET study, which I'll need to emphasize what still is because it's still ongoing with an open-label arm, a small proof-of-concept study. The way we like to do studies in Lundbeck, very challenging disease, of course, and traditionally, people do big studies for new generation, but we try to define a study that was tailored to in as small size as possible, give a decent signal of the molecule working. As you can see from the graph here, we enrolled 61 patients from sites in U.S. and Japan. We had 3 sites in Japan and the rest were in the U.S. The study had a design of 1 dose arm and 1 placebo arm. And it was imbalanced randomization. So we had 40 patients or 41 patients on the active arm and 20 on the placebo arm. So a very small tailored study, but a fairly long-term study with primarily looking at an endpoint at 24 weeks, but we went on 48 weeks and beyond long-term study. So people actually were on the study for various lengths of time, where the endpoint was at the defined time point. The main readout here is UMSARS. UMSARS is a primary readout that has been discussed in this field, and with then, of course, to the regulators agreeing to use this scale, but it's something that is fairly new to the field, of course, since people have not really gone into this indication much in the past. Of course, we had the inclusion and exclusion criteria. And sometimes people get this disease as a fairly young age, so you see their ages ranges from 40 to 75 years. And as obviously, clinical diagnosis, it's a possible or probable MSA diagnosis. And the diagnosis was made according to new updated criteria for the disease quite recently published. As I said, this is a fairly rapidly progressing disease. So during this time period, we anticipated that we would be able to detect some effect on clinical progression. And that is really what we've been looking at primarily with the endpoints, but we also had endpoints related to biomarkers. And here you see this flow of different readouts we had. From disease progression with the UMSARS readout, various parts of it, functions, global impression, CGI-S, et cetera. And then we looked at autonomic symptoms, global disability, various disease milestones, speech, swallowing, et cetera, and also how people progressed on the disease to a later-stage diagnosis. Health-related quality of life measures and MRI biomarkers as well as 2 different sets of fluid biomarkers, of which NfL in blood and also CSF was taken. And then obviously, we took a look at the pharmacokinetics of the compound. So a rich set of different readouts in the study. So when we looked at the -- this different readouts, I think I actually skipped this slide. I'll go to the next slide here. I think it's important that we look at the baseline characteristics of the study. Obviously, with such a small study, you can be prone to small variabilities in inclusion, having some effect on the readout. But looking at the group of patients we included, it looks very well balanced. We have obviously people with the MSA-C form, the cerebellum form, that is a dominating form, which is also dominating the study, but we also had patients with the MSA-P form. And we will not talk about this today, but obviously, we have possibilities to look at the subgroups here, but please note the small sample sizes here. In terms of sex distribution, it was very much the expected, about an even split. Race, yes, you heard that we had several sites, 3 sites in Japan. So we had an Asian contribution to the study. But otherwise, it's quite dominated by Caucasian individuals in the study. Again, the diagnostic criteria were following the probable or possible diagnosis. Fairly short time since diagnosis, we tried to get people into the study as early as possible. So you can see that it's not a very, very long time with symptoms or of course, with diagnosis, which obviously, with this little complicated disease may take a little time from symptoms to diagnosis. You see some measures on baseline data on NfL, et cetera. The disease stage was reasonable severe. But since we're aiming for early-stage patients, it was not a very, very advanced stage of the disease. Many patients had orthostatic symptoms problems. You see here about 30% to 40% of the patients. So what have you seen with this study? Obviously, we got the data just early today to really look over. But I think overall, I would say it's encouraging. We did miss on the primary endpoint, but that was trending in the right direction. I think it's important to emphasize that we also had a number of other measures that I listed before. And all the measures we look at generally are trending in what I would say, the right direction, including biomarker endpoints. We will come back to details about this. So [ I ] have to apologize. I'm not going to go into the details of the secondary and biomarker readouts in this call. We like to analyze this more in detail. And we like also to primarily address the scientific community with those data moving forward. And of course, we are also looking forward to discuss this with regulators moving forward. But I think it's also important to say that this was a very tolerated therapy. We really didn't see anything of concern here. So some of you may know about this area and other things, you may see in other indications for monoclonal antibodies addressing pathology of protein aggregation. We have not seen any safety signals of any kind similar to that. So overall, a very, very tolerable treatment. We do emphasize, of course, that we're looking at progression of disease. And what we're looking here is really the UMSARS total score over time. And that's where we saw what is trends are slowing the progression of disease, which is, as I emphasized at the beginning, fairly rapidly progressing disease. So we had within that time frame, a decent possibility to see effect on disease progression. And that's what we see with a trended data. So with that, I'd like to summarize the finding with this first-in-class antibody, which has -- if you look at this profile in vitro and preclinical data on this molecule. We have pretty strong data on that. It has a good binding, high affinity binding to alpha-synuclein and prevents in animal models, the aggregation and progression of disease. Now we're moving forward with this study, testing the proof of mechanism and also proof of concept with this molecule. And we believe that we have definitely achieved proof of mechanism. And it looks like we have a clinical signal here that encourage us to move forward in the development with this molecule. So that brings, of course, hope for patients with this disease, but we have, again, to be very, very careful with this. It's an early study, a small study, but it's enough for us to say that we most likely are going to progress within soon with this molecule in further development. So with this, I'd like to leave over for Q&A.

[Operator Instructions] And the first question comes from Xian Deng from UBS.

So just one, please. Understanding that you might not be able to give full data today. But just wondering, could you give us a sense about the possible next step here. If I say I give you, let's say, for the 3 possible scenarios, say you will start another Phase II or you progress directly into Phase III. And just for the sake of completion, even let's include a super blue sky scenario of let's say, accelerated approval. So just wondering how do you think about those potential future steps?

Yes. Thanks a lot for the question. I mean, obviously, we kind of ask ourselves the same 3 questions. So there are 3 good questions here. You should never sort of be too detailed in your planning before data readout, but when you have it, you have to move fast and decide what you do. But we will be very deliberate in what we do as a next step. Obviously, this is a smallish study, but as I said, encouraging data, which, in different ways, require, and we are obliged, I would say, to have a conversation with regulators about it to understand what next steps could be in their eyes also. But these kind of studies are often followed by another study. The degree of confidence in the data we have is, of course, a big factor here. And I would say, based on the data we have, which, again, are encouraging, this will definitely be more a development program next step, if that is what we agree with regulators that will aim for registration of a product. It's clearly of the kind of data when we say it's -- there is a degree of derisking here, that encourage us to move forward with a more dedicated program towards registration. The accelerated approval question. Obviously, that is something that people always ask, and this is something that I think we'll leave for a conversation with regulators more in detail. This is a very, very big medical need area. So obviously, it's a tricky balance, how much data you need and how much support you need. So this is definitely something you can also design into upcoming program, how you may take different looks and cut that data. So there are many, many possibilities here. But all 3 questions are super good, and we're going through them ourselves, and we'll probably come back with more information when we're ready for it. But this requires definitely an interaction with regulators. That's for sure.

And the next question comes from Charlie Mabbutt from Morgan Stanley.

I guess I'd be interested to know how much of a delay in progression you believe you need to show to make the product [ currently ] viable. And I guess how long of a study do you think you would need to show that sort of benefit if you have not seen a statistical significant benefit with patients up to 72 weeks? Or would it just be a case of a much larger trial size?

Again, really good questions. Yes, there are different role or the term ideas about what is clinically meaningful. I mean, obviously, we talk about 2 things often in clinical trials, statistical significance and clinical significance. And there are various ideas about what is clinically meaningful here or clinically significant. Role of the term has often been 25% effect, but it also depends on dedication, how aggressive it is and what you can offer on different readouts because what you do, of course, in these trials are looking at symptomatic readouts as a surrogate for an effect on disease progression. So you, of course, need to offer something that indicate that you're slowing down the progression. The data we have definitely indicate that that's going on. So to go to your second part of the question, how long study and how much you'd like to see and how big it is. This was as small as a study probably you can do to look at proof of concept in a chronic neurodegenerative disease with reasonable solid data set to make decisions on. And that's really how we like to do development here. So with this data in our hands, we have much, much more information. Prior to this study, we basically had no prior information. Very few studies done in this field and very little information from any natural progression study. Now we're sitting on a much better data set to decide how big a study would need to be and what power we would look at and what sample size we would look at. But again, it's a small study where we have encouraging data. So it's about matter also about how strong the effect is. So yes, 72 weeks was the longer end, the outer end of the study. We have patients that were between the primary readout and 72 weeks. And data set is actually dropping off because several people did not have time to finish that part from the primary end point to 72 weeks. Now we're going to have data gradually on an open-label part of this when everyone is switched over to active drug, which will also help us a lot to see how well the drug can at a later time point switch over and have an effect. So we are looking forward to something in the ball range of 25% and it's definitely a bigger study, but time-wise, I think we did a really good study in terms of the primary readout and maybe allow people to go on longer time. Did that answer your question?

And the next question comes from Manos Mastorakis from Deutsche Bank.

My question is basically what mechanistic or clinical hypothesis are you already forming in your head as to what could be going on that could either explain the results? Or in other words, help you see a statical significance in the next study? And for example, could neurofilament difference between the 2 arms be responsible for part of that result because, as far as I saw it, there was a little bit of an imbalance there? So can we get your thoughts?

Yes. Thank you. Yes, I don't think we have talked about the neurofilament and imbalance, but you mean the baseline data, I assume, in the baseline data, the neurofilament, is that your question?