Janux Therapeutics, Inc. (JANX) Earnings Call Transcript & Summary

Okay. It's the end of the day Friday. It's been a busy week, and I am excited to say that I am in sunny San Diego. And I'm in town here for the big ASH conference. So as I'm sure most people out there know, it's the biggest hematology conference, so blood disorders, blood cancers, things like that. It's always one of the most important meetings for the biotech sector. And while I'm in town, I arrived last night, I have the chance to stop by a local company that was the big newsmaker in biotech this week and had some really interesting data that we're going to talk about. So I'm at Janux Therapeutics. This is David Campbell. He's the Founder and CEO. It's great to be with you again. We did a video earlier this summer when you had some initial data. It's nice to catch up again.

No, it's good to see you again, and appreciate the invitation to speak again today.

All right. And whenever I'm traveling, I always start with the question like where are we? And in this case, I actually know very well because we're in a complex called Torrey Plaza that's been built by Breakthrough Properties. And for full disclosure, Breakthrough Properties is one of our sponsors, and we love the support that they've given us. Tell us about what it's like being here like in this complex?

Yes, a couple of things. When we first came into this building, it was a shell. So we work closely with the Breakthrough and the design team, put together what I think is just an outstanding biotech research center for ourselves. We've got a couple of floors here. High, high quality. We've been very pleased with the Breakthrough team, great work. And around the corner, they have a massive facility that just went up. I believe Pfizer has rolled into that. BD has rolled into that. So clearly, a new player in San Diego, but they're hitting the ground running and doing a great job.

Yes. This neighborhood is really becoming like the place to be in San Diego biotech. So let's talk about this week's data. And before we do that, so in our previous videos, we took like a deep dive into your technology. So people can go back and watch that for like a full deep dive. But the general idea here is you're doing bispecifics. And the story of bispecifics kind of like cell therapy is it's worked very well in blood cancers, hasn't worked as well in solid tumors because safety and finding the right antigen and things like that. And your solution to that problem is you have a masking technology so that the -- like the T cells are set off where the tumor is. At a very high level, remind us what that masking technology is, how it works and like what the purpose is?

Yes. So when we speak to mask, what we do is we identify small peptides, typically about 14 amino acids long that bind to the domains that interact with either the T cell or the healthy tissue target. And when they bind, they block the ability to interact with their target. And if you can block that interaction, that inhibits the pharmacology. So in healthy tissue, the way to think about these, these masks are in place, can't interact with target. We're not driving the immune response in healthy tissue. Once it enters into the tumor, the tumor is a completely different environment. You have these proteases that basically chew proteins into smaller pieces. And when we take advantage of those proteases that are unique to the tumor environment. They clip our masks off and release them. And so now they can bind to the T cell, they can bind to the tumor cell, they can trigger that immune response in the tumor tissue. So that's the background on the approach that we're taking that we're certainly utilizing in the prostate cancer program that we're going to speak to.

Yes. And there's also like an albumin component to this that gives you a longer half-life, right?

Yes. I don't want to go too complicated, but since you brought up, another critical aspect is can we dose these once a week, once every other week. And so we have a half-life extender that's appended to our early drug upon tumor activation, that half-life extender is also released just like the mask. And the reason we did that is when that T cell engager, that activated T cell engager now escapes from the tumor, we don't want it to accumulate over time. If it accumulates over time, you're going to start triggering immune responses in healthy tissue. So by having that half-life extender, our initial drug that we dose once weekly every other week upon activation of the tumor, it comes off when it escapes from the tumor, it's cleared from the body rapidly. And we think that's also what's allowing us to have the safety multiples that we're having, the adverse event profile that we're having. And quite frankly, that allows us to increase our doses which is why we're seeing such a profound effect on the tumors.

All right. Let's talk about the data. You already said this is prostate cancer. But tell us exactly what stage of prostate cancer. And your drug is a PSMAxCD3, correct?

Correct. Yes. So we're in end-stage metastatic castration-resistant prostate cancer.

I do that all the time.

Yes. mCRPC is a little bit easier. These patients on our particular program and the recent update have seen an average of 4 prior lines of therapy. That's typically going to include androgen receptor pathway inhibitors, taxanes, probably a number of experimental drugs on top of that. So these patients have -- are no longer responding to any of the available drugs. And so -- those are the patients that are rolling on to our program. So while they've seen an average of 4 lines of prior therapy, you can think in a very general sense, this is the fifth line of therapy that on average, these patients are seeing.

Okay. And you're trying to go for patients who have not yet received the radiopharmaceutical Pluvicto. Can you explain that?

Yes. Right. The data that we shared in February and the update started indicating that this drug had a very good response profile in patients. And this is a Phase Ia trial. So we're not talking about PFS and overall survival yet where we want to get to in Ib and beyond. But markers of antitumor measuring PSA drops, et cetera, coupled with safety profile, it was very well tolerated. CRS, which is an issue for T-cell engagers, CAR-Ts, we only had Grade 1 and Grade 2. And we're seeing significant impact on the activity marker of PSA. So we began thinking in February once we had that data set as well as discussing with the clinicians who are doing our clinical trial, they start telling us this is exactly what we're looking for in earlier lines of therapy. We want PSA to be dropping immediately. Our drug drops in the first week or 2. We want the majority of patients to respond. That's usually measured by percentage of patients who achieve a PSA50. We had very high in February, 80%. Now we're at 100%. We want well tolerated. So based on that data set, we started thinking along these lines, especially with the PI clinicians input. Then since then, leading up to Monday, we continue to see an improvement in that already compelling data set that we saw in February. And so when you start thinking about what the clinicians are looking for, what the patients need in earlier lines of therapy, the opportunity that a well-tolerated drug with a very high response rates in patients, our focus shifted to pre-Pluvicto. We're very, very interested in second-line applications. We're going to look at third line, pre-Pluvicto, depending how those studies turn out, if we continue to show profound efficacy, manageable safety profile, we'd start thinking about moving that into even earlier lines of therapy. So we've gone from pre-February, pre the first update, yes, we had been indicating we were going to be fourth line post Pluvicto single agent. It's about a $500 million market. As you start thinking about the profile that we're going to talk about that we had in February, but certainly even enhanced in December, we think that is a drug that is worthy of and is important for the patients to have access to an earlier lines of therapy.

Okay. Let's dive -- you've already mentioned a few key aspects of the data, but let's dive deeper into it. So I believe it was 16 patients. Is that right?

There was. There was.

So let's start with efficacy. If you can kind of go over a couple of the key numbers that you believe are most important.

Yes. Yes, the 16 numbers caveats everything we're going to say. By definition, it's small numbers, it's Ia. And I'd like to be transparent, so we'll start there. But based on the data set, I would say we've seen a directionality to this program from February through December, where as measured by the patients achieving a PSA50, in February, we're at 80%, now we're 100% out of those 16. Everybody who gets our drug achieves at least a PSA50. Other relevant metrics, PSA90. We're now at 63% of those patients who get our drug achieve a PSA90. 31% now are getting a PSA99. So as we've increased the dose, we've maintained well-tolerated safety profile as measured by this early PSA reduction, significant improvements. For comparison, Pluvicto in third line plus best standard of care comes in at about 48% at a PSA50. Now the next measure is durability. We all want to get to overall survival, but in Ia, you don't have that. Early indicators of durability is, do you maintain a PSA control at 12 weeks. Pluvicto and Novartis did some great work showing if they were able to maintain PSA50 or better, PSA90 or better at 12 weeks, that correlated with PFS and overall survival. So using that 12-week number, we now have 75% of those patients are maintaining PSA50 or better at week 12. We now have 50% of our dose patients are achieving or maintaining a PSA90 at 12 weeks. So all positive. The other new data set that we came in, clinical data set is we've shown that this drug is fully active against either wild-type or any of the mutants we looked at, androgen receptor, mutant variant amplification, BRCA, et cetera. This drug is fully active. As long -- it appears that as long as PSMA is expressed on the tumor, this drug is active. And now that's beginning to correspond to radiographic analyses. In RECIST-evaluable patients who have soft tissue mets, we're beginning to see those improved PSA profiles and durability, beginning to convert to RECIST responses, partial or stable disease. In bone-only patients, which is a significant portion and are part of your PFS and overall survival, we're also -- they also get bone scans. They're just not part of your RECIST evaluation because it's bone. We're seeing significant improvement in staying on drug. We've got patients on drug for 6 months or more in that population. So we're very gratifying to see those PSA results are now beginning to show activity in the measurable for PFS, RECIST and bone met patients.

Okay. And let's go over safety as well. And we should also clarify, not only is this a Phase I study, but in a Phase I study, you have various doses going on and a big result of this is you believe that you found the go-forward dose, right? But tell us about from a safety perspective.

Our safety profile remains similar to what it was in February. And at a very top level, the majority of the adverse events that we see occur in cycle 1 and cycle 2. Each cycle is 3 doses. So cycle 1, cycle 2, the vast majority of them are related to secondary to cytokine release. CRS is always an AE of interest for T cell engagers in CAR-T. You really want to minimize Grade 3 CRS in cycle 1. We've continued to maintain a grade 1, grade 2 CRS profile with this drug. So in addition, what we also like to note is we're not seeing any accumulating chronic long-term tox. Like if we were talking about an ADC, clearly, thrombocytopenia with many of those, you see them, you see it growing over time. And oftentimes, that may be what limits how many doses Pluvicto, radioligand therapies with myelosuppression, some of the others. We're not seeing any of these chronic long-term accumulating toxicities either. So all of that continues to support a well-tolerated safety profile, coupled with a profound early efficacy profile.

Okay. So this was very well received. Your stock was way up. A lot of analysts had -- so Wall Street clearly likes it. A lot of analysts had positive things to say. My friend, Josh Schimmer, he said this was not just way above expectations. He said, way above expectations. But there has been like some discussion of a couple of things that I want to bring up. And the first, you already mentioned it, this is 16 patients. So what would you say to people out there who have seen oncology data in very small patients that it has looked great and then you get to bigger studies and it doesn't follow through. Is there something that you've seen in these 16 patients that give you confidence that you believe in larger studies, it will all hold up?

I would. I'm going to start with the February update where the numbers weren't as good as what I've just said. The PSA50 was 80%. We had very few. I think we had only 17% at a PSA90. We didn't really have anybody who had achieved a 12-week control. Many were expecting us to regress to the mean. If we think about historical, we can look at Amgen with their STEAP1. We can look at Ambrx with their ADC. We can look at Pluvicto. PSA50s are all about 50% of patients. And here, we are at 80%. People were expecting us to regress. Clearly, we haven't. The directionality, we've gotten even better than we were. I think that's one of the reasons it was so well received. People had been expecting a -- the real question had been, well, they're at PSA 80%, we still think that could be a win if they were at 60% or 70%. So that was how the Street was looking at that. So I look at -- this drug has been very target dose dependent. If you look at February, we had early interesting data. As we've increased the doses, we're having more patients respond. As we've increased the doses a bit more, we're starting to see those PSA reductions improving radiographic evaluations in bone and RECIST. Right now, if you think about the delta between us and the others, I would be more concerned if we had a PSA 60%. Even if we regressed a bit to 90% or 80%, it's still so much better than everybody else. And I'm not expecting that. It's just like baseball, you've got to play the game to see. But right now, we're just seeing a certain directionality in our data from February through this update as we increase doses, things get better, that all leads me to think highly unlikely that we're going to see a significant regression going forward.

Got it. And then there's 2 other things, and this is where we kind of get like nerdy on statistics and how things are presented. One term that people might be familiar with out there is confirmed for the overall response rate, sometimes responses, and this is totally out of your control. It's just like how the patients see the physicians. Some responses are called confirmed responses and some are called unconfirmed responses. And some people are real sticklers about like the overall response of just confirmed responses or the overall response of unconfirmed plus confirmed. What can you say about that whole subject in the context of your data?

I'm going to say we agree. We all prefer confirmed. I'm also going to note that we've been very clear. If you look anywhere in our deck, if there's an ORR, there's an asterisk on it, a footnote. So they're all confirmed and unconfirmed. And when we break it down, we highlight -- I think we had 8 RECIST-evaluable patients, one of which was confirmed, 3 of which were unconfirmed partial responses. One is still on drug, may shift. 2 were lost to study. They were lost to study not because they lost response, which is when you get really nervous about that partial response. One was lost before his next scan because he had an adverse reaction to his influenza and COVID vaccination. So he came off study due to that. So it's not that we took the next scan and it didn't confirm. He was lost to study. The other patient, 022 was an individual lives in Australia, was 2 to 3 hours away from the site, stopped -- started missing doses. Of course, you're going to lose control. So as we look at those 2 unconfirmed, I'm not going to skirt they're unconfirmed, but it really was due to other activities other than the drug stopped performing. And I don't want to be accused of parsing. I'm just simply sharing the information. I'm not disagreeing with anybody, hey, we would all prefer those all to be confirmed. But early data in Ia seeing -- in February, the question was, well, that's a really interesting PSA. You're not showing us any RECIST. Now we're starting to show that it is translating into RECIST responses. I also want to point out that it's also important to note that the bone-only patients aren't RECIST evaluable, but they get bone scans every 9 weeks also. If you look at our swim plot, there's a significant number of those patients, one rolled out to 30 weeks before he lost control. We've got a couple at 24, a couple right behind. So I think the sum total of the data is our PSA profile. PSA control is now beginning to have a positive impact on radiographic evals. Agree with the uPR. We'd prefer those to be complete, but we think there's some reasons for, and we're still very confident moving forward. If, for instance, it was a uPR because, hey, the drug keeps on losing activity, I'd be as nervous as anybody else. We just haven't seen that. It's a small data set, but we view the early data as directionally moving in the right direction.

Right. And then the other term that's kind of similar is intent to treat versus how -- versus what you presented. What can you say about the intent-to-treat population and how similar or different it is than the 16 that we've seen so far?

And so what we're alluding to is, hey, we excluded Pluvicto treated patients because we're focused on second line, third line. We actually started deemphasizing even recruitment of those patients. A couple of things. It's only 4 patients that we removed from the subset. So it's a sum total of 20. Those 4 patients, it's always a fine line with what we're doing in these public updates, which are geared to give the public insight and competitive intelligence. We know a lot about these patients. We've studied them. They'll be part of an update at some point. Right now, they're not relevant to a second line, third-line eval that we're contemplating for what we're trying to convince investors right now is we believe this drug warrants being pre-Pluvicto, second line, third line, here are the relevant patients. When we do a comparison to Pluvicto, well, Pluvicto doesn't have Pluvicto in it. So all of that was focused and why we did that. It's a fine line between giving an update to investors and it's a competitive environment. We don't want to give teachings at this time point.

I appreciate that. Sharing what you have just now is helpful because I heard whisper numbers, there were a lot more than 4 patients. So we've set the record on that, and I think that's helpful. All right. So what would be -- let's talk about the next steps.

Brad, just to help you there. I think that would come back to, hey, you just simply say the last patient is 49. Our last update was 23. Doing the math, we're going to say 13 are new. So 23 plus 13, 26, 36, hey, there's 13 Pluvicto patients out there. And what I just got done saying is there's 4. So that's going to lead somebody to say, well, what are the other 9? So I'm just going to -- just to be clear, the other 9, we said in February, we're going to evaluate, hey, instead of weekly dosing on the first cycle, can we do all 3 doses in 7 days? We've learned now. So they weren't part of this because we're not doing that. The other is we're beginning to evaluate Q2W, early data, not robust enough to read on, can we have a Q2W. So those are the other 9. So I just wanted to give you a little bit of that because when you roll out with this, people are then going to say, but Brad, there's 9 or 10. I'm not really sure if the 4 is the right number. So I'm giving you a little bit more background there.

Appreciate that. Thank you very much. Let's talk about next steps. So now that you have this data in hand, what are the next steps for this program? And you have an EGFR1 also we'll talk about in a moment, but what's the next step for prostate cancer?

Yes. Wrap up the Ia in the public update on March -- on Monday, we noted that we have another QW group that's started. 9 mgs was the top target dose we evaluated. 12 is in progress. We're looking at does that -- we've seen a dose-dependent improvement and durability from the target dose going from 2 to 3 to 6 to 9, and that's on one of those slides. So our next question is, well, what happens when we go to 12. And so what we're really interested now is durability between the 12-week and the 30-week period. If 12 is better than 9, better than 6, then we'll swap out 6 or 9. So that's in progress. The Q2W is in progress. All geared towards -- in 2025, we want to start our Ib studies. Our Ib studies, one will be in third line pre-Pluvicto for project Optimus with the FDA. We'll take 2 QW doses, and we're hoping to bring a Q2W dose into that study. The other is where we're really, really interested as we develop this drug is second line. Patients who receive taxane in first line typically get enzalutamide. We'd like to evaluate our drug in combination with enzalutamide. Enzalutamide in this patient population has a PFS of about 8.3 months, adding 007 on top of that, coming back to 007, we showed in this is fully active against all of the resistance drivers that we know about to enzalutamide. So the loss of activity that limits enzalutamide, the androgen receptor mutant variant amplifications, our drug is active against it. So we're very excited about that for 2 reasons. One, that would be our first pivotal study. Financing this week was to support that pivotal study. We now actually have enough financing in hand to take this drug and generate Phase II/III pivotal data going forward. The other reason that we're really interested in this is enzalutamide is moving into earlier and earlier lines of therapy even in front of mCRPC. So being able to combine with enzalutamide is very attractive. This Ib study not only will begin to read on the risk opportunity for a pivotal study, but also begin reading on the risk opportunity to move into first line or even earlier line. So it's a critical, very important study for us.

All right. Got it. I always think big picture and like one thing -- prostate cancer, as you're describing, is a huge potential market. But like one thing I always wonder with a platform company when you have a first indication really sending a signal is, do you believe that, that signal will translate into other types of cancers and with other targets? So you have an EGFR program that we'll have some data from next year. Tell us what to expect there? And also, how do you think of it as just a validation of your masking technology and what the future might hold potentially even beyond EGFR?

What -- at a very top level, what we've learned from this program, some very straightforward questions. Are you going to be able to get enough unmasking in a tumor to drive an antitumor effect? I think the answer now is yes. Keeping in mind, prostate cancer is a mix of bone mets, liver mets, other soft tissue mets, lymph nodes. So we've got a wide range, and we know from the literature, different proteases. The protease profile of bone met is different than a soft tissue met. So our own data is saying, yes. The other aspect, does the masking work well enough that you can avoid adverse events in healthy tissue. Our early data is saying yes. So at a very top level, we've checked a few important boxes. The next is, as we think about target space, there's a continuum of targets from really easy as in no toxicity expected, I haven't seen that one yet, but it's one extreme. To the other, wide healthy tissue expression, high healthy tissue expression. I would put PSMA somewhere in the middle of that continuum. I can argue about exactly where, but somewhere in the middle. Anything there and to the left, we feel clearly validates and derisks -- to the right, and that would include EGFR, which is a much more challenging safety target is we check some of the boxes, but now, hey, how far to the right of PSMA can we go? And that's what the 008 program is telling us. So the update on -- we've been saying since February, there will be an update in 2025. Our hope would be is that it is similar to what we did in February for 007, not to say we have a drug, but to say, we have enough patients showing a response that you can now look at the efficacy and safety data, believing if there's an opportunity here. So that's on 008. Behind that, we've started applying our technology to additional targets. We have a number of targets undergoing IND-enabling and manufacturing. We're going to have -- we're going to host an R&D Day in 2025, where we talk about them, disclose the targets. The 3 main buckets that we're interested in, of course, are CD3-based T cell engagers. We have a clear -- we've clearly been interested and been talking about CD28 bispecifics for a while. If you think about T cell engagers, I think we can all agree based on the literature, one way to improve durability even more is out of CD28. So we're evaluating that bucket. And then the third is we've learned a lot about T cell engager biology, patient responses, nonclinical evaluations. We think that information positions us in a unique way to think about I&I with T cell engagers. And so that's a third bucket of interest to us, and we'll give our update during our R&D Day next year.

Interesting. I&I is super hot right now. That would be an interesting follow-up. This has been a lot. Let's finish by talking about business development because whenever someone has data like this, people start asking about things. I'm sure you can't answer partnerships, buyouts, things like that. But I know you have -- so a couple of years ago, you announced a partnership with Merck. Remind us exactly what that is and whether it applies to this program or EGFR or not? And just in general, from a very high level, how do you think about potentially partnering and all of that?

Yes. So Merck Research Labs, we partnered with at the -- gosh, what was that? December of 2020. And in that program, our goal was to develop 2 tractors against 2 undisclosed targets. They're not part of -- it's not EGFR, it's not PSMA. It's not any of our publicly disclosed. It's 2 other targets. So we've been working with them. They've been a great partner, gosh. We've learned a lot from working with them. Loved that organization, scientific bent, plus they have the ability to run experiments. We just don't have the equipment. So it's been -- we've learned a lot about our molecules. So we're very pleased with that. Those 2 are continuing to progress. I can't say what the targets are. Merck will disclose what the targets are and where we're at when they want. Clearly, last year, I think on -- or this year, we did receive one milestone, a development milestone, just not described what it is, but that's just an indication that the programs are moving well and continuing to go forward. So no read-through IP to any of our other IP other than the 2 targets of interest that we're prosecuting with them.

Got it. So for this program and potentially EGFR, it's wholly owned right now...

Correct.

Would you consider partnering? And is there anything you could say about like as a leader, how you -- like generally, the timing of things like that. Do you think -- I mean, this is very early data. I guess my question is, is it the right thing to do to partner early like this? Or are you the type of person that believes that you should think about that much further on down the road?

To me, they are always value propositions. We've -- I think our actions speak louder than words. We already had enough money to complete the Ib studies on 007 and 008. We just completed a financing that was announced Wednesday evening, I believe it was. I've just shared with you that allows us to get to pivotal data on 007. So the way that we think about the strategic opportunities of partnering, et cetera, is the best thing we can do for Janux, our shareholders as well as that process is focus internally on our program, execute to the best of our ability. We now have the finances. We don't have a need to partner on 007. We're well financed. The other way to think about that is -- there is -- as of now in the early data set, it is so differentiated. It has an opportunity to be a best-in-treatment sort of drug. Those are rare events. We think that the risk profile for our Ib based on this early data set is well manageable. So the way that I would respond to that is it's always a value proposition. We have the financing. We have the team. We have the skills. Our plan is to execute full speed on our programs and the other stuff will take care of itself.

Yes. And that's obviously a great position and a rare position to be in because prostate cancer is a huge indication. And most companies get to a point where even when they have success, they don't have the funding or the scale to be able to run pivotals in a big cancer like that. You're saying you clearly have the money and the ability to do that yourself.

Yes, we believe we do. And we have other catalysts down the road, the Ib data from 007, for instance, that would come out in 1.5 years, a couple of years down the road, we have additional opportunities. So we already have enough financing to get to pivotal data, and we have additional catalysts coming down the road. So we're in a -- I've been doing this for 35 years. First time I've ever been in a position like this or quite frankly, ever had involvement with a drug like this.

Yes. Well, speaking of 35 years, I'm guessing this is in a good way, one of, if not the most hectic weeks you've had, so thank you for taking time to finish out speaking with me. Really appreciate your transparency and I learned a lot in this conversation. So thanks for your time and best of luck looking forward to following the program.

Brad, always happy to speak. If you're in town, give me a honor, love speaking with you.

Thank you.

Okay. Good to.