Jade Biosciences, Inc. (JBIO) Earnings Call Transcript & Summary

Good morning, everybody, and welcome to another presentation with the Oppenheimer Life Sciences Conference. I'm Trevor Allred, an analyst here with the Oppenheimer Life Sciences team. We have with us today Tom Frohlich, CEO at Jade Bio. Tom, please take it away.

Great. Thanks, Trevor. Much appreciated, and thanks to the Oppenheimer organization for hosting us. It's been a really great conference. And I'm very pleased to provide an overview of Jade Biosciences on behalf of our team. As always, I'll be making forward-looking statements. So for more details, please do look at our SEC filings. Jade Biosciences is a company really dedicated to developing best-in-class therapeutics across a number of different autoimmune diseases. We have been established with three programs that we have had access to from Paragon. Paragon Therapeutics is a company based out of Boston who are very talented protein engineers. They have a real knack for developing very high affinity binding monoclonal antibodies, but then also have deep expertise in half-life extension technology. So we've applied that strategy across our three programs really to develop best-in-class therapeutics against validated programs, validated targets. What we believe the benefits of using that high affinity binding concept along with half-life extension technology really provides two key benefits. One is more complete inhibition of the target throughout the entire dosing interval to really maximize clinical activity available to the mechanism. And then the second one is, of course, with this long extended dosing interval really to minimize patient burden and have the most convenient medicines available for those patients. So our lead program is JADE101. It's an anti-APRIL initially in development for IgA nephropathy, a large and exciting opportunity with a rare kidney disease that has increasing focus on it recently with new approvals in the area. With JADE101, we believe we have the opportunity to become the best-in-class and potentially best-in-disease molecule and capture a large portion of that large and growing opportunity. We're currently in a Phase I healthy volunteer trial, which is aimed to read out in the first half of this year. And that readout is crucially important to us and a very big milestone for the company, because we're quite lucky in IgA nephropathy. It's a very biomarker-rich disease. And the readouts that we see in the healthy volunteer population are a direct read-through and very predictive to the clinical activity we expect to see in patients. So with that data in the first half of this year, we'll be able to have an extensive characterization of the compound, really understand the profile, what level of clinical activity we can anticipate as well as the dose interval to be able to move very quickly with high conviction into patient trials and move very rapidly towards marketing authorization. We did disclose earlier this year and we plan to initiate a Phase II in the middle of 2026 with interim data in '27. So very exciting time for that program. Our second program is JADE201. Similarly, very exciting. It's an anti-BAFF-R, which is following the footsteps of ianalumab, which is their BAFF-R at Novartis, which is currently across 6 different Phase IIIs. So has very broad potential across a number of different autoimmune diseases. We are moving that program forward quickly with a planned first-in-human to initiate in the second quarter of this year with data in 2027. So our second program and moving Jade towards being a multiple clinical asset stage company. We have a third program, JADE301, which we have not disclosed the target for competitive reasons. We will disclose that as we get closer to the clinic, which is planned for the first half of 2027. Follows a similar playbook where there's a more advanced asset that has derisked the target, but we believe through our protein engineer capabilities from our partners at Paragon, we can develop a best-in-disease molecule. So stay tuned for that. We will disclose more on that as we get closer to the clinic with that program. We didn't nominate a development candidate on that. We've previously disclosed that. This is all supported by a very strong team with very good capabilities in IgA nephropathy and the other areas that we're going into, a proven track record of success there and all underpinned with a strong financial position. We closed 2025 with $336 million in cash, which gets us into the first half of 2028, covering these key milestones listed here on the slide. So JADE101, an extremely exciting molecule for IgA nephropathy. Why are we so excited? Well, there's four key reasons. One, IgAN is going to be a very large commercial opportunity. We had previously estimated that it was around a $10 billion opportunity, a branded market opportunity in the U.S. alone. But we actually believe now that, that's actually probably very conservative and underestimating. We saw the recent approval at the end of 2025 of VOYXACT, which is sibeprenlimab, which is Otsuka's anti-APRIL. And it was approved with a very broad label. So really increasing the population that is suitable for this class of medications. And also, they priced at the top end of the range that people were expecting. So we actually believe this $10 billion opportunity likely is conservative, and we've seen analyst reports that have several fold higher than this. So a large commercial opportunity with room for multiple entrants and a very attractive place to play. We believe within that large opportunity that the selective anti-APRIL class is really poised to become frontline foundational treatment for all patients diagnosed with IgAN. And that really is because the mechanism is disease-modifying. It has the potential to take away the root cause driver of disease, that pathogenic IgA. It has demonstrated with other agents to have large decreases in proteinuria and to stabilize kidney function. So we really do believe that anti-APRIL class is going to move to frontline and be foundational for all patients with IgAN. Within the anti-APRIL class, we believe we have a straight shot at becoming the best-in-class agent. Our JADE101 is designed to capture the full efficacy available to the mechanism. It has superior potency. It's femtomolar binder to APRIL, over 750-fold more potent than sibeprenlimab. Of course, as well, it has the YTE, half-life extension mutation, which does garner a long duration of action, and we believe will be the most convenient medication available for IgAN. We're aiming for a dose interval of no more frequent than one subcutaneous injection every 8 weeks, which we believe for this young patient population will be really crucial and very highly differentiating. Finally, there is a very efficient path to market. I already mentioned that healthy volunteer biomarker data is very translational and predictive of what we anticipate to see in patient. So that will be very just derisking that data we expect in the first half of this year. But also the surrogate endpoints are used for approval. So things like proteinuria and eGFR can be used for a very efficient path to market. So just elaborating a little bit on the size of the opportunity. I already mentioned that this is a very large opportunity, about 170,000 patients diagnosed in the U.S. alone with several hundred thousand in Europe and several million in Asia. We believe about 60% to 75% of those patients are eligible for treatment with an anti-APRIL medication. And that's really driven by their risk of disease progression. You can see in the Kaplan-Meier graph on the left, the lifetime risk of progression in all patients with IgA nephropathy is high over their lifetime. Patients are typically diagnosed in their 20s and 30s and do remain at high risk of kidney function loss or death. And this has largely calculated the risk of progression by their proteinuria levels, which are directly associated with time to loss of kidney function. And you can see that patients at higher levels of proteinuria really declined quite quickly, over a 50% chance of losing kidney function completely within 5 years if you're above 1.75 grams a day. But conversely, that really drops quite significantly if patients are at lower levels of proteinuria. Here in the lowest quartile, roughly below 0.5 grams a day, you can see that patients are at the lowest risk of long-term disease progression. And that's really why there's a call with the KDIGO guidelines to really target patients to that below 0.5 grams a day to minimize that risk of long-term kidney function loss. And what you can see here is we believe that it's going to expand the patient population, these new recently published guidelines. Any patient who's above 0.5 grams a day should be diagnosed with a biopsy. And then that's really established as the new target that physicians should treat below, really highlighting the need for very efficacious medications. They've established this proteinuria target that all patients need to get below 0.5 grams a day, but preferably below 0.3 grams a day, which is really clinical remission back into the normal zone. So this is really going to bolster the need for very efficacious proteinuria lowering medications and highlight the use of patients with the highest -- with medications with the highest levels of proteinuria reduction will really drive adoption. The other thing that's very encouraging for the anti-APRIL class on this slide and the KDIGO guidelines is they're really redefining treatment strategies. Historically, patients were always treated with ACE inhibitors and then steroids if they weren't responding. But now they're really saying that patients need to be on two classes of agents or two types of agents, one that manages local nephron loss, so things like ACE inhibitors, SGLT2s and ERAs. But additionally, the patients should also be on medications that treat IgAN like an autoimmune disease and reduce that pathogenic form of IgA. And we really believe the only classes of agents that have shown this dramatic reductions in pathogenic IgA are the selective anti-APRILs or the APRIL/BAFF. And we strongly believe there is going to be a preference for the selective anti-APRILs over time. So JADE101 is very well positioned to capture a large portion of this IgAN market. The femtomolar potency and half-life extension really confer properties that are going to make it best-in-class potentially. It will have that opportunity to fully suppress APRIL through the dosing period to really capture that full efficacy available to the mechanism, so potentially best-in-class efficacy, do that with minimizing treatment burden. So no more than one subcutaneous injection every 8 weeks or potentially 6 injections a year. And to do that really with the most narrow focus on the targets that are driving pathology and pathogenesis of disease to avoid unnecessary immune suppression. I mentioned in the last slide that we believe that APRIL is providing that disease-modifying impact where the dual APRIL/BAFFs potentially have unnecessary immunomodulation. And we believe that because really that the biology of the disease points to APRIL as really the key driver in disease. IgAN is a plasma cell disease, where it's caused by an increased production of galactose-deficient IgA, which does result in autoantibodies that form immune complexes that then damage the kidney. It is known that APRIL is really driving plasma cell differentiation and antibody class switching to IgA-producing plasma cells that's really driving this and hitting APRIL has been shown time and time again to really ameliorate disease. Conversely, it's not quite as clear the role that BAFF inhibition is playing in IgAN. It has been shown or tried with rituximab, CD20 has been used in IgAN patients with really no impact on IgA, IgA autoantibody production or proteinuria with no impact on eGFR. Similarly, a selective anti-BAFF inhibitor, blisibimod was used and similarly had no impact on IgA or proteinuria. And we've seen that play out as well in the clinical studies as well. This is a slide showing the recent results with sibeprenlimab from their Phase III. So sibeprenlimab is a selective anti-APRIL, and it also shows the results published by atacicept. Both showing very good reductions in proteinuria. And a reminder, atacicept is the dual APRIL/BAFF. Very good results in proteinuria. But you can see that the results are actually quite similar. And it's clear here, there's not an increased effect of adding BAFF on top of the selective anti-APRIL inhibition, really driving home that point that APRIL is driving efficacy in this class. And we believe for that reason, we will be really preferred by physicians to not have long-term immunosuppression but is not driving clinical activity. So within the APRIL class, why do we think that we have the opportunity to be best-in-class. As I mentioned, sibeprenlimab was recently approved. But with their commercial presentation, we don't believe they're fully capturing the efficacy available to the mechanism. They did switch from an IV body weight adjusted presentation in Phase II to a flat, more convenient subcu presentation in Phase III, where they aren't capturing the full efficacy. You can see here in the Phase II study on the right-hand side that they did test 3 IV body weight adjusted doses, 2, 4 and 8 milligrams, where they did see a clear dose-dependent reduction in APRIL, in total UPCR reduction and very importantly, getting more patients at the high dose up to patients into complete remission. So nearly twice as many patients below 0.3 grams a day. Their commercial presentation, which is the 400 milligrams is roughly similar to their middle dose here, the 4 mg per kg. So we believe they're leaving some efficacy on the table that we aim to capture with JADE101. So why do we believe we can capture that? Well, JADE is really designed from a de novo antibody screen to be ultra-high binding. And as I mentioned, it's femtomolar potency over 750-fold more potent than sibeprenlimab and over 2,000-fold more potent than zigakibart. It also has the YTE half-life modification to really allow for extended dosing, complete coverage of APRIL through the dosing period, but then also this really more convenient, fewer injections for patients. This was exhibited in the NHP profile. On the left-hand side here, you can see that increased potency and half-life extension do translate into extended PK with JADE101 compared to sibeprenlimab in the purple. And you can see here nearly a fourfold improvement in half-life of JADE101 versus sibeprenlimab. On the right-hand side in NHPs, you can see that, that does translate into pharmacodynamic activity as well. With in purple, you see sibeprenlimab have a very typical reduction in IgA with a rebound post, around the 3- or 4-week period, whereas with JADE101, you do get these deep and prolonged reductions in IgA, really giving us that confidence that JADE101 has the potential to extend that dose interval and really capture the full efficacy that is available to this mechanism. So we should know in the first half of this year in healthy volunteers if we are achieving that. We did initiate the study in 2025. It's a 4-cohort dose Phase I trial, where we are measuring safety and tolerability. We, of course, will look at PK immunogenicity. But most importantly, we are looking very closely at pharmacodynamics, things like reduction in APRIL, reductions in IgA. And this is particularly important to us because we have built a translational framework where we have looked at the impact of APRIL and IgA neutralization across all the trials that have been done with both the selective anti-APRILs and the dual APRIL/BAFFs and figured out how to translate that into what we anticipate seeing in patients and really do observe that it's very, very highly predictive. So with this data that we'll be generating in the first half of this year, we will be able to understand, are we hitting that clinical profile? Where we do have these large drops in IgA supported by reductions in APRIL. And we'll be able to see how does that compare to the clinical doses of the other agents that are on the market. Are we hitting that profile of that top dose of sibeprenlimab IV? And are we able to do that for an extended period of time to really pick our dose and our dose interval to move forward into patient trials. And we'll have confidence and conviction around that because there is really strong evidence showing that healthy volunteer reductions in IgA are very closely correlated to what you expect to see in IgAN and that those IgA reductions do correlate as well with UPCR clinical activity. So really giving us that conviction to move forward as quickly as we can. And as mentioned, we are doing start-up activities at risk right now to initiate a Phase II around the middle of this year. So just really in summary, we do believe that JADE101 has that possibility of being a best-in-disease agent for IgA nephropathy. With a high potency, we can capture that clinical activity available to the mechanism and do that with a very favorable Q 8-week single injection or less. So a very exciting time for us and very meaningful period for the company as we move towards this data readout. So switching gears quickly to JADE201. This is an anti-BAFF monoclonal antibody that is following the footsteps of ianalumab at Novartis. We are very excited by this mechanism because it has broad utility across a number of different autoimmune diseases. And we believe this mechanism, which has been validated by ianalumab, really overcome some of the limitations with other B cell reducing agents. It's been long established that deeper B cell depletion does translate into better clinical activity in these autoimmune diseases. And with the BAFF-R mechanism that has that dual mechanism of action, we can overcome some of these key elements, obviously, getting more complete B-cell depletion and hitting broader set of cells. But also with things like CD19 and CD20, when you do deplete B cells, you actually get this compensatory increase in BAFF, which is a pro survival signal, which actually drives quick repopulation. Also, with those mechanisms, the CD19s and CD20s, they can only kill B cells in the presence of effector function cells. So they get deep B cell depletion in circulation, but have trouble getting at lymphoid tissues. And what we can see with JADE's dual mechanism of action, you do have this direct cytotoxicity similar to CD19 and CD20. So this rapid B cell depletion in circulation. But you also get this blocking of the B cell signaling by blocking the BAFF receptor. And what that ends up doing is you prevent that B cell repopulation through the upregulation of BAFF, but also you can get B cell starvation in areas where there are not effector function cells. So really seeing better tissue B cell depletion. So JADE201 is designed to mimic the pharmacological activity of ianalumab, but to do it with a half-life extended antibody. And our preclinical data really does show that we are getting that dual mechanism. So we are blocking BAFF signaling in cells and also getting this direct cytotoxic activity in circulation. This is just a quick NHP study showing that we do have this extended PK, are blocking BAFF-R occupancy and do get deep and prolonged B cell depletion in nonhuman primates. And of course, importantly, the limitation that we're trying to overcome with ianalumab is that it has a very short human half-life of 10 days, only 2.5 days roughly, 2.7 days in nonhuman primates. And you can see that with JADE201, we do have a meaningful improvement over that half-life. So what we are doing in -- our study is we are beginning that trial. We anticipate having it started in Q2 of this year. It will be a study in rheumatoid arthritis patients. But think of that study more as a healthy volunteer surrogate, because we can't go into healthy volunteers with this mechanism. And we do anticipate having data on that study in 2027. We will be looking at safety and tolerability, looking at PK, of course, the pharmacodynamics, looking at B cell depletion dynamics as well as some flicker of efficacy in RA patients with the joint and swollen -- sorry, tender and swollen joint counts to measure DAS28 to understand if we are getting a small signal. But caveat there that the study really isn't powered around efficacy. So it's more around the safety and the pharmacodynamics. Now we like rheumatoid arthritis as a potential indication. About 5% to 10% of patients with RA end up on rituximab. So there is an opportunity, but it is unlikely to become one of our lead indications for 201. We are currently evaluating actually over 20 different indications where rituximab is standard of care or highly used. And looking at two different strategies. One is to look at the indications that have this asterisks that are where ianalumab is currently in a Phase III study and understand the fast follower population or fast follower indications. And we are also looking at a number of different indications where rituximab is used, where Novartis likely didn't go for strategic or pipeline prioritization reasons. And so as our data unfolds and we see more information from ianalumab, we'll be able to make that determination and disclose our lead indication. So just in summary, very quickly wrapping up. It's a very exciting time for Jade. We are moving with the anti-APRIL program, JADE101, to very meaningful data in the first half of this year, initiating a Phase II in the middle of this year with data on that in 2027 and then advancing our second program into the clinic and then driving towards having three clinical programs in the clinic by the first half of next year. So a very exciting time, and thank you for your attention.

Great. Thanks, Tom. Very comprehensive overview. Looks like it's going to be an exciting time to be taking a look at Jade. So thank you all for joining us, and we'll see you in the next presentation.

Great. Thanks for having me.