Herantis Pharma Oyj (HRTIS.HE) Earnings Call Transcript & Summary

Hello, and welcome to Herantis Pharma's Phase Ib Biomarker Data webinar. I am CEO, Antti Vuolanto, joined today by CSO, Henri Huttunen; and CFO, Tone Kvale. We are really excited to discuss yesterday evening's announced biomarker data for HER-096, our lead asset currently in development for the treatment of Parkinson's disease. These data present a significant milestone for the company, providing evidence of biological response to HER-096 dosing in humans with effects on pathways closely connected to the expected mechanism of action. Following the presentation, there will be a Q&A session. So please submit your questions throughout the webcast. First, the necessary forward-looking statements, and then I will start by a short summary of Herantis Pharma. So Herantis is a clinical stage public company, and our ambition is to stop the progression of Parkinson's disease with our lead asset, HER-096, which is a small peptide mimicking the active side of a neurotrophic factor called CDNF. With -- HER-096 protects dopamine neurons from further degeneration and supports their functional restoration. The main benefit of HER-096 is that it penetrates efficiently the brain, so we can use subcutaneous administration. And now we have completed the Phase I program, and we believe that this derisks the path to clinical efficacy trials as we have solid safety data, we have demonstrated efficient brain penetration, and now with biomarker data, we have proof of biology. And now we, of course, want to advance discussions with potential pharma partners and investors utilizing the data in order to resource a Phase II efficacy trial. So in this webcast, we will discuss the biomarker data based on the Phase Ib clinical trial and the top line data we disclosed in early October. During these months since the top line clinical data, we have analyzed over 2.5 million data points that we have collected during the study. And of course, we believe that the biomarker data will have a huge value in upcoming partnering discussions. And this biomarker webcast really will focus on biological mechanisms and target pathway engagement. And it's good to remember that biomarkers are not efficacy signals. So no conclusions based on those should be drawn. And the contents of the webcast, we will provide you the context and background of the biology, of course, describe the study design and describe the methods used. We will provide the top line biomarker data and interpretation and relevance of that data, which is followed then by the Q&A session. We believe that the biomarker data really builds confidence towards the clinical efficacy trials as we now have the proof of biology. So a clear evidence of a biological response to HER-096 treatment in Parkinson's patients. And these data show nicely the translatability from preclinical to clinical data. So we have now bridged the data from preclinical data to clinical data in terms of safety and tolerability, biological response to treatment effects on the target pathways. And we also established a translational biomarker profile in preclinical settings, and now that's confirmed in the Phase Ib trial in Parkinson's patients. What remains to be shown is, of course, the efficacy effect on symptoms, which we will study in Phase II trial. I want to take this opportunity also to thank all the healthy individuals and Parkinson's patients who have joined the Phase I program, enabling us to be here today. And now I hand over the word to CSO, Henri Huttunen, who will present more details of the data.

Development of disease-modifying therapies for Parkinson's disease has been quite challenging, mainly due to the fact that the disease, particularly the biological underpinnings of the disease are fairly complex and heterogeneous. The disease also has a fairly slow rate of progression, which can also be very variable. And because of these reasons, the clinical trials can actually be quite long and costly. And this is one important reason why biomarkers play such an important role in early drug development in Parkinson's. So demonstration of biological evidence at this stage of development is an essential derisking element in the whole program. And this is why we are so happy today to share these good news with you. We believe that this data can support mechanistic validation in humans. It, as mentioned, importantly, supports the translatability of the data from preclinical models to clinical settings. And also for our Phase II planning, it supports dose selection informing on exposure-response relationships. So overall, reducing uncertainty ahead of us in the next steps. Now this whole data set circulates around a single question, does the human body respond to HER-096 as expected? This is a really important question for this stage of development, but it has been somewhat challenging for HER-096 because we are really developing a pioneering treatment that's targeting all 3 arms of the unfolded protein response pathway in parallel. And there is no direct target engagement biomarker available. And thus, there's a lot of pioneering work that we have been doing ourselves with generous support from European Innovation Council, Michael J. Fox Foundation and Parkinson's UK. So the single question, does the human body respond to HER-096 as expected, will be really at the core of today's presentation. We will approach it from multiple independent angles. So in summary, this biomarker data set provides the first early human evidence that HER-096 engages its intended biology and produces disease-relevant molecular effects in humans -- in patients with Parkinson's disease, which is a very strong signal supporting our clinical development. In our preclinical studies, we have explored broadly the therapeutic effects and basically the biology behind those therapeutic effects. And this is -- I want to give you a little bit of context on that before we move to the clinical data. So Parkinson's disease is neuropathologically characterized by accumulation of misfolded protein aggregates in the brain, particularly alpha-synuclein playing a key role in Parkinson's. And this disruption of proteostasis has several consequences. It can lead to deregulation of various stress response pathways in neurons, for example. And at the same time, glial cells and immune cells are also strongly stimulated by these protein aggregates. And this vicious cycle has been quite challenging to break from the therapeutic perspective. Now our preclinical data very clearly shows that HER-096 dosing in animals improves proteostasis very broadly beyond the unfolded protein response pathway alone. We see changes related to protein synthesis, folding, degradation. And importantly, we also see changes related to mitochondria. And this is a really new and interesting observation that we have carried from the preclinical studies now to the clinical studies as well. Mitochondria are essential and at the very core of Parkinson's disease pathophysiology. There are various genetic factors, environmental factors, et cetera, that all point to a central role of mitochondria in addition to the disrupted proteostasis in Parkinson's. So in our Phase Ib study, we included 24 patients, subjects who had been diagnosed with Parkinson's disease. And all these subjects received doses, either placebo dosing or 2 different dose levels of HER-096 over a period of 4 weeks. So altogether, 8 doses. And today, we will be focusing on the long-term response in particular. So this means that we will be comparing the pre-dose sample of the last dosing visit to the pre-dose sample of the first dosing visit. There are also other time points that we've collected samples during the study, but this -- we believe that this long-term cumulative drug response comparison is particularly interesting. The data layers that we have available from this study are really quite numerous. And as mentioned, we have more than 2.5 million data points generated, allowing deep biomarker profiling. So we have both targeted assays and approaches, including some mitochondrial-related assays, as shown here. And this was motivated by our findings in the preclinical studies. And the largest body of the data comes from the untargeted, mainly proteomics-based studies. Here, we've used various technologies, including aptamer-based SomaLogic proteomics, but also mass spectrometry-based proteomics. So analyzing 2.5 million data points is quite a challenge, and it's very labor-intensive and time consuming. And I just want to highlight a few key points in this process here. So typically, we follow standard established bioinformatics pipelines in this process. The first steps include extensive quality control and normalization methods. So in a way, the preprocessing takes quite some time so that we can then do meaningful comparisons later on. Then in the next step, in the feature extraction step, we try to identify individual molecules and expression patterns that show statistically significant differences between subjects or treatment groups. And in the following step, then we typically use pathway analysis and mapping where we try to understand if there are similarities in individual markers. For example, in a given pathway, are there multiple markers changing in a concordant fashion that would strengthen the conclusions. One important strength of the current study design and the depth of the data is really the multilayered nature. This allows integrative multi-omics analysis. It allows a certain level of orthogonality in our data analysis. So if we see some changes in one data layer, do we see similar changes in other data layers? If so, this obviously strengthens the conclusions and indicates that these biological changes are actually true and meaningful. So as a reminder, the patient population in this study included 24 subjects in 3 groups, and this table summarizes the Parkinson's disease status at screening. We also have done quite extensive biological characterization of these patients. So for example, all subjects in this study were positive for dopaminergic deficit by dopamine transporter SPECT imaging, confirming the diagnosis. Also, we have included alpha-synuclein seeding assay from the cerebrospinal fluid samples, and all except 2 of the subjects in the high-dose group were positive for alpha-synuclein seeding. Genetic characterization using Centogene's panel of 115 Parkinson's disease-related genes, identified 6 carriers of genetic variants related to the disease. Unfortunately, these carriers were not evenly distributed as this analysis was done after the study. So we have -- half of the genetic carriers are in the placebo group and then rest in the HER-096 group. However, this doesn't distort the data analysis in any way. It's just an additional layer of understanding what might be happening in response to HER-096. So the first data here is going to be on plasma proteomics. We're not going to be able to show you 2.5 million data points, so don't worry about that. We'll show you a couple of examples of data, of responses and then a higher level summary of the rest of the data sets. So here, we're looking at a systemic response. HER-096 is subcutaneously administered, meaning that there is a systemic response to the drug, very likely. And again, we are comparing the pre-dose samples of the last dosing visit to the first dosing visit and of course, then group comparisons. So here in the first image in a heat map that's shown here, we have a number of so-called driver proteins derived from the overrepresentation differential expression analysis from -- in this plasma proteomic set. So we are following 11,000 proteins in plasma samples longitudinally, and this is a summary of the driver protein expression. So heat map here shows, first of all, the horizontal lines are individual subjects in the study. And each vertical column here is an individual plasma protein. And the heat map shows here the directionality. So the hot colors showing upregulation of an individual marker, and cold colors showing downregulation. So immediately from this image, you can appreciate that there is -- this image differentiates very clearly the treatment groups. The 300-milligram HER-096 group clearly stands out from the placebo group, and the 200-milligram group stands somewhere in between here. And one additional feature in this image that's noteworthy is that we have actually ordered the HER-096 subjects based on their plasma exposure. So the higher the exposure, higher the level of HER-096 in plasma, the lower the subject here is. And there is -- you could say there is some dose dependency here considering this plasma exposure rating ordering. So the overall interpretation of this data is that HER-096 dosing induces broad proteomic changes in plasma at week 4. Then you might ask, what are these proteins, what do they do? And for this purpose, we will take a closer look at so-called functional annotations. So here, each protein and each gene has a functional role in the body in cells. And these are typically described in databases using gene ontology terms and annotations. So when we looked at these up-regulated proteins in plasma, we noticed that there's a very frequent high-level gene ontology term that keeps reoccurring, and this is proteostasis. Proteostasis was represented in 18 different gene ontology terms, showing that this is really -- comes close to the known mechanism of action of the drug. And now if we take a closer look again in the form of a heat map, here, we're comparing groups, and we're focusing on 262 proteostasis-related proteins. We can see a very similar pattern. We see that the 300-milligram group here is clearly standing out from the placebo group in terms of upregulation of proteins. The little asterisks here indicate statistical significance. And on top of this graph, you can see some grouping, functional grouping. And as you can see, we actually are affecting proteostasis very broadly. We are affecting protein synthesis. We're also affecting protein folding, but also degradation and catabolism. So there's proteasome, there's autophagy, there's ER-associated degradation. So overall, we can conclude that there are broad and coordinated modulation signs of multiple proteostasis domains changing following HER-096 dosing. And this clearly supports that there is an engagement with proteostasis pathways that are in line with the drug's proposed mechanism of action. So next, I will move from untargeted data to a targeted assay. So here, we have looked at a small panel of mitochondrial metabolites. And I'm focusing here on one very important metabolite called glutathione, which plays a role in detoxification of oxygen radicals and protection of cells against oxidative stress. Glutathione plays a very important role in pathophysiology of Parkinson's, both in terms of neurodegenerative processes but also neuroinflammatory processes. And when we now compare whole blood samples from the last dosing visit to the first dosing visit, we can see quite interesting difference. Again, the 300-milligram group, HER-096 treated subjects are statistically significantly different from placebo subjects in the glutathione redox balance ratio. So this indicates that there are enhanced oxidative stress defense mechanisms that are modulated by HER-096 which pinpoints mitochondrial involvement very strongly. And this is, again, in line with our preclinical findings, similar to those proteostasis findings from the plasma data. Another look at mitochondria comes from mitochondrial DNA. So mitochondrial DNA is known to be susceptible to damage and breaks lesions in response to oxidative stress. And this can actually lead to also induction of inflammatory processes in cells. And when we isolated DNA from peripheral blood mononuclear cells and analyzed the mitochondrial DNA with a custom PCR method, we actually noticed that there is a statistically significant reduction in mitochondrial DNA lesions. And this is an expected direction considering that there are effects on mitochondria and oxidative stress defense mechanisms. So the conclusion here is, is that the reduced mitochondrial DNA damage in blood cells is consistent with HER-096-mediated mitochondrial benefit. So in this slide, I will summarize on high-level findings from this biomarker study related to the Phase Ib repeated dosing. So in the cerebrospinal fluid proteomics, we saw concordant changes in proteostasis and oxidative stress-related proteins, similar to those what we've seen in other data sets and also preclinically. There were also some individual markers that are functionally related to microglial activation and polarization, which indicates that there may be also changes related to neuroinflammation in the CSF. Regarding systemic markers, as presented, there's clear evidence that HER-096 exposure results in cumulative multi-domain proteostasis effects and improvement in mitochondrial status. And an additional data set lies somewhere between the nervous system markers and the systemic markers, and this comes from extracellular vesicles. So we've isolated extracellular vesicles from plasma using a technology called [ NeuroSPARC ], which enriches vesicles that contain nervous system derived markers. And interestingly, also in these extracellular vesicles, we saw mitochondria-related changes. So there really are concordant shifts in biology in response to HER-096 treatment. So if we briefly graphically summarize this, there are well-known changes in Parkinson's disease that relate to deregulation and disruption of proteostasis. There is mitochondrial insufficiency, and there's also increased level of oxidative stress. And all 3 biological pathways or entities here significantly contribute to the fact that the dopamine neurons are suffering from increased level of stress, and their viability is decreased. So this is the baseline status. And now this biomarker data is clearly telling us that when the patients are exposed to HER-096 for some time, here, in this case, for 4 weeks, we see very clear signs of proteostasis domains being improved in terms of protein expression, mitochondrial function being improved, and oxidative stress markers going down, at the same time, the defense mechanism is going up. And this correlates naturally with reduced stress levels and improved viability. So this is very much aligned with our preclinical data and the disease-modifying potential of HER-096. So at the end, I would like to highlight and emphasize the continued support that we've had from the European Innovation Council, Michael J. Fox Foundation and Parkinson's UK. Together, this staged funding has allowed us to do significant preclinical biomarker discovery work, which laid the foundation to design a meaningful clinical biomarker discovery study. And with the help of the virtual biotech funding, Michael J. Fox Foundation and Parkinson's UK., we were able to really design the study, including many layers of data, which again increases the orthogonal nature and seeing differences across multiple data layers, increases confidence that these are really true meaningful biological shifts caused by HER-096 treatment. So in summary, we have now demonstrated that HER-096 is biologically active in the human body. It has effects that are aligned with its mechanism of action and disease-relevant pathways such as mitochondria. So this is -- we are very happy with these findings, and we believe that this actually -- this proof of biology significantly reduces the risk for Phase II and together with previously demonstrated good safety profile and the evidence for supporting effective brain distribution positions HER-096 very strongly in the current Parkinson's clinical pipeline. The next steps, naturally, we will push forward in our Phase II -- ongoing Phase II preparations. And for this purpose, we also will pursue with our strategic partnership efforts, negotiations and obviously try to look for resources to support a meaningful Phase II study. So I will stop here. And I think now we have time to move to questions from the audience. Thank you for your attention.

Thank you, Henri, for a very nice presentation. So Tone, you will lead us to a Q&A session.

Yes. So first question is, you say that your Phase Ib biomarker data shows biological response to HER-096 in people living with Parkinson's disease. What does this actually mean?

It means that a biological response to treatment means that there are changes in individual biomarkers or multiple biomarkers that, first of all, follow exposure to the drug and not the placebo and are relevant to the mechanism of action of the drug and potentially also disease-related pathway. So this is what we mean by biological response. And maybe also good to emphasize that this is not to be mixed with the assessment of clinical efficacy. So these are the first signs that there is something meaningful happening in the human body. And hopefully, over time, these biological changes will translate into meaningful clinical changes in symptoms.

Good. Thank you. What is Herantis' financial solution if an agreement is not reached immediately?

Yes. So basically, as we have already mentioned many times earlier, we are actively in discussions with pharma and our preference would be to engage with a pharma even before the Phase II trial. However, independent from that, we are also in discussions with investors and looking at different ways of resourcing. The Phase II trial also includes grant financing. And of course, during the next months, we will see how the partnering discussions are advancing and what will be the way of resourcing the Phase II efficacy trial.

Do these findings speed up the process for a Phase II trial?

In some ways, I wouldn't say speed up, but significantly support. They can support dose selection in forming of the exposure-response relationship. They can identify certain biomarkers that need to be followed in future studies. Potentially also, there may be something in this data that supports patient selection and potential stratification in the data analysis. So there are many, many aspects in this data that are very important for the Phase II study. And hopefully, also that will enable us to kick off the study sooner than later.

And maybe I will continue that. Of course, we believe that these data, they are key catalysts for the partnering discussions and maybe also for the investor discussions and of course, feeding them that process will enable us to start the Phase II.

Yes. What was the most striking important result from all of this biomarker data?

That's a really great question. That's a really interesting question. One thing is that this is -- as mentioned, this type of massive data set is not something that there's a single moment in time when everything just magically opens up. It's a gradual process where you go through individual data sets, you see a sign here, then you take another data set, you see maybe something similar here. I think it was probably one of those moments in the past weeks or so where we started seeing concordant signals in multiple data sets. And I personally believe that this is the biggest value of this data set that we -- it's not a single biomarker or a single data set. It's actually the concordance in the data that speaks loudly.

And does your data suggest biological effect, especially in the central nervous system or only systemic effect?

Another very good question. So in today's presentation, we highlighted data that are actually mostly from -- regarding systemic response. But we do also have, as mentioned, the cerebrospinal fluid proteomics and those extracellular vesicles that are enriched in nervous system-derived markers. It looks like there is clearly something in those brain-related markers as well. But in general, I would say that the systemic response is so strong and clear that it's maybe perhaps a little bit overpowering in this data. But it's not that we don't see anything in the CSF. We actually do.

Good. How confident are you of the fluid biomarker data?

This is obviously an exploratory study. This is largely biomarker discovery work. So we have to be a little bit careful with interpretations. Biomarker research in general has been challenging, particularly in terms of replication in different cohorts and between different technologies and so on. And that's another reason why we are so grateful for the support from the foundation so that we could include already in this study, multiple technologies and orthogonality, multiple layers. That creates confidence. But naturally, many of these findings need to be independently verified in other studies, future studies.

So do the biomarker changes observed support expected mechanism of action?

Absolutely. Absolutely, they do. There is no direct target proximal biomarker for unfolded protein response pathway or GRP78, the direct binding partner. So we can't say it's direct target engagement evidence, but it is very clearly related to unfolded protein response pathway modulation. The unfolded protein response pathway is heavily relying on modulation of transcriptional programs. So gene expression changes, these tend to be slow and cumulative. And the type of changes that we see in the plasma are very clearly exactly those type of changes. We are really modifying the way the cells are responding to this proteostasis disruption.

Do this finding help with planning the dosage for the Phase II trial?

I think it strongly supports that at least the 300-milligram dose looks very good. Based on this data, I would say that 300 is a very good candidate for a dose level for a next study. This is, however, something that we need to still work on and confirm in our internal Phase II preparations to make sure that we are choosing wisely.

Are there any markers correlated specifically to Parkinson's disease development?

I think the mitochondria is a really strong thing here. Mitochondria are such an important player in Parkinson's pathogenesis, pathophysiology that when we first saw those mitochondria oxidative phosphorylation, mitophagy related things changing in the preclinical data, we were really excited. But we, of course -- it was hard to tell what to anticipate how human patients would be responding, and actually seeing that mitochondrial changes are associated with the biological response is very exciting.

How do you see this data in perspective of getting a partnering agreement? I know you're going to JPMorgan next week. So can you say something about that?

Yes. So we have discussed with several potential partners over the years. And I think we have very clear understanding about the expectations. And of course, showing data from humans that we have a biological response will be a major milestone. However, does that -- is that enough to have a meaningful partnering agreement? Well, there is no guarantee for that, and that's why we are going to JPMorgan, and we'll continue the discussions. Of course, we believe that this is the case, and that's the ambition. But to be seen during this spring, of course, will be an exciting spring for Herantis Pharma.

Good. A final question. Are you happy with the results of this biomarker data?

I'm very happy for the team, for the partners. We had a very large group of partners supporting us here for the funding organizations and especially happy for the patients.

Good. I think that concludes the Q&A session.

All right. So thank you for listening this webcast. As we have many times said, this data was really good and according to our expectations. And we have a very interesting winter and spring time ahead of us with discussions with pharma, finding resources for Phase II and of course, setting up the Phase II efficacy trial. So I hope you will continue following our progress and success, and thank you for listening.