Lexeo Therapeutics, Inc. (LXEO) Earnings Call Transcript & Summary

Good morning, and welcome to Lexeo Therapeutics webcast presentation on LX2020 for the treatment of PKP2-associated arrhythmogenic cardiomyopathy. As a reminder, this call is being recorded today, January 12. I would now like to turn the conference call over to Louis Tamayo, Chief Financial Officer of Lexeo Therapeutics. Louis, please go ahead.

Earlier today, we released interim data from the Lexeo HEROIC-PKP2 Phase I/II clinical trial of LX2020 for the treatment of PKP2-associated arrhythmogenic cardiomyopathy or ACM. The press release outlining the interim data update is available on our website at lexeotx.com as well as the slides related to today's call. Joining us on today's call will be Nolan Townsend, Chief Executive Officer; and Dr. Eric Adler, Head of Research. Before we begin, I would like to remind you that this call will contain forward-looking statements regarding Lexeo's future expectations, plans and prospects, which constitute forward-looking statements for the purposes of the safe harbor provision under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in our filings with the SEC. With that, I would like to turn the call over to our CEO, Nolan.

Thanks, Lou, and thank you all for joining us. Today, we are pleased to share preliminary data on the safety and efficacy of LX2020 across a meaningful sample of 10 participants dosed to date, 8 of whom have at least 6 months of follow-up. Looking first at transduction and protein expression, we have observed mean increases in PKP2 protein expression as well as robust vector copy number and exogenous mRNA at 3 months post dosing with dose-dependent increases between the low and high-dose cohorts. We are also seeing appropriate co-localization of the PKP2 protein within the desmosome using immunofluorescence. In terms of clinical measures, we are seeing early benefit in 2 key measures of arrhythmia burden associated with increased risk of poor outcomes, including sustained ventricular tachycardia, ICD shock and sudden cardiac death. Premature ventricular contractions or PVCs have been stabilized or reduced in the majority of participants at latest visit, and we've observed a 14% mean improvement across participants in the high-dose cohort. Nonsustained ventricular tachycardia has also been stabilized or reduced in the majority of participants at latest visit with a 22% mean improvement in the high-dose cohort. Finally, treatment with LX2020 has been well tolerated across all 10 participants dosed with no clinically significant complement activation and no new serious adverse events to report. We are encouraged by these collective data on the therapeutic potential of LX2020, including those from relatively early time points in the high-dose cohorts, and we are eager to advance development of this therapeutic candidate as the data continue to mature. I will now turn the call over to Dr. Eric Adler to provide an overview of PKP2-ACM and to review these data in more detail. Eric?

Thank you, Nolan. Arrhythmogenic cardiomyopathy is most commonly caused by mutations in the plakophilin-2 or PKP2 gene, affecting approximately 60,000 people in the United States. PKP2 deficiency in ACM is a disorder of the cardiac desmosome, a protein structure which allows cells to adhere to each other and is strongly associated with the fibro-fatty infiltration of cardiac tissue. Patients with PKP mutations are at high risk for cardiac rhythm abnormalities, heart failure and sudden cardiac death. Tragically, over 20% of patients experienced sudden cardiac death as their first presenting symptom, which is why familial history and genetic testing is so critical in timely diagnosis of this disease. Following diagnosis, most patients with PKP2-ACM receive an ICD or implantable cardioverter defibrillator. While this device can mitigate the risk of sudden cardiac death, it does not address underlying disease progression with patients continuing to experience ongoing arrhythmia and associated anxiety. Additional medications such as beta blockers and anti-arrhythmia drugs have shown some benefit in managing arrhythmia symptoms but do not address the underlying genetic cause of disease or progression. When looking at arrhythmia burden, we often focus on 3 measures in order of severity. First, individuals with PKP2-ACM may experience frequent premature ventricular contractions or PVCs. In fact, one of the minor diagnostic criteria for ACM is greater than 500 PVCs per day. A PVC is an extra or early heartbeat that originates in the ventricle, disrupting the heart's normal rhythm. These early beats may be caused in part by calcium ion instability. And as we will discuss, PVCs can go on to trigger more severe sustained arrhythmia. Nonsustained ventricular tachycardia, or NSVT is another key measure in this disease, closely associated with poor outcomes such as increased risk of sustained VT, ICD shock and sudden cardiac death. Non-sustained is defined by episodes that are self-terminating and last fewer than 30 seconds. Although brief, people with PKP2-ACM are more likely to feel episodes of NSVT compared to PVCs, which can contribute to significant physical discomfort as well as heightened anxiety regarding the underlying disease. PVCs can trigger NSVT events when the extra heartbeat continues for 3 or more consecutive beats, consistently overriding the normal heart rhythm. In some cases, ventricular tachycardia fails to self-terminate, which is life-threatening and can result in a third measure of sudden cardiac death. In individuals with an ICD, sustained VT can trigger an ICD shock to restore normal heart rhythm. People with PKP2-ACM are at particularly high risk for sustained VT and may undergo surgical ablation to manage this risk, although recurrence after ablation is very common. As mentioned on the previous slide, PVCs may trigger VT, so the 2 measures are related but driven by potentially different mechanisms. Think of PVCs as a spark and VT is a fire. One PVC may not be hugely clinically significant alone, but patients with a high PVC burden are at high risk for development of both ventricular tachycardia and heart failure. PVCs may initially arise due to calcium ion leak, disrupting the heart's refractory period and depolarization. Calcium instability due to PKP2 deficiency is likely due to downstream proteins, not PKP2's direct function in the desmosome. So we hypothesize it may take more time to observe significant reduction in PVCs to normal levels in this disease. When a PVC meets another underlying vulnerability, this is when a fire or when VT can occur. In PKP2-ACM, one key vulnerability is slowed electrical conduction caused by the destabilization of the desmosomal complex due to PKP2 deficiency, which is essentially a scaffold protein. Another example is the development of scar tissue or fatty fibrotic tissue, which can disrupt the normal flow of electrical signals throughout the heart. When a PVC meets a vulnerable area of the heart like this, a reentry loop can also occur so that the premature beat propagates and contributes to re-excite the heart consistently. This combination is what leads to VT. Given the different mechanisms of these endpoints, we hypothesize that VT could be reduced if vulnerable areas of the heart are improved even if high PVC burden persists. Looking briefly at the natural history of disease, you can see on the left that individuals with PKP2 ACM can experience high and persistent PVC burden, though there is significant variability both between individuals and within the same patient over time. It's important to note that activity and exercise significantly influence measures like PVCs and NSVT, so it can be hard to separate lifestyle factors from underlying disease progression. What you can see in the chart on the left is a reduction in PVCs immediately following diagnosis, usually because health care providers recommend a cessation of exercise and some patients may begin other therapies, including beta blockers or antiarrhythmic drugs. However, following this initial intervention, PVC burden persists and even appears to increase after 4 to 5 years. The middle graph illustrates risk for severe VT, which is higher with a high PVC burden plotted on the X-axis. PVC burden alone does not fully explain arrhythmic risk. As you can see in the orange and dark gray lines, patients who experience NSVT are significantly more likely to develop VT than those without NSVT, even if their daily PVC burden remains the same. Finally, on the right, we are sharing some preliminary data from the Lexeo-sponsored snapshot prospective natural history study. 15 patients is a relatively small sample, but what's interesting about this data set is that it includes individuals further along in their disease progression, 8 years from diagnosis on average, and it also quantifies NSVT burden rather than reporting as a binary outcome, which is how it is most often presented in the literature. Here, you can see that PVCs and NSVT both increase over a 12-month period and each are associated with greater VT risk. Importantly, arrhythmia burden persists or progresses in some patients despite consistent use of beta blockers or other antiarrhythmic drugs, highlighting the need for disease-modifying therapies. LX2020 is designed to treat the root cause of PKP2-ACM by delivering a full-length PKP2 gene to cardiomyocytes. We package the full-length PKP2 gene in an AAVrh10 vector, which has an increased affinity for cardiomyocyte cells in the heart, allowing us to use relatively low doses compared to commercially approved gene therapy treatments. LX2020 also includes a cardiac-specific promoter to further localize expression in the heart, which we believe could support a more favorable safety profile while still delivering efficacy in treating this cardiac disease. LX2020 is currently being evaluated in the heroic PKP2 Phase I/II clinical trial, an open-label single-arm multicenter trial designed to assess the safety, tolerability and preliminary efficacy of this therapeutic candidate with 2 dose cohorts. This study is focused on adults with a documented PKP2 mutation, an existing ICD and no pre-existing immunity to the AAVrh10 vector. Ten participants have been dosed, including 3 participants in Cohort 1 at the low dose of 2E13 vg per kg and 7 participants in Cohort 2 and 3 at the high dose of 6E13 vg per kg. On this slide, you can see the baseline characteristics summarized across participants in the low and high-dose cohorts. These characteristics are consistent with the clinical manifestations of PKP2-ACM and you can see that these participants are pretty advanced in their disease progression on average, especially at the high dose with a mean of 9 years since diagnosis and significantly elevated arrhythmia burden. Importantly, I will note, 9 of the 10 participants had no limitation from heart failure symptoms yet as measured by the New York Heart Association class, which is consistent with arrhythmogenic cardiomyopathy, where arrhythmia burden presents earlier in the disease and end-stage heart failure may not develop in all participants or within the decade following initial diagnosis. Here, you can see the baseline characteristics for each individual participant who is dosed as well as some relevant medical history related to arrhythmia burden, sustained VT, ICD shock and ablation. You can get a sense of the advanced disease progression in these individuals. For today's presentation, safety data is summarized for all 10 participants who were dosed, while efficacy data is inclusive of those participants with at least 6 months of follow-up as of the data cutoff date of January 7, 2026. At the bottom of the table, you can see the latest visit for each participant. I will now share safety data. LX2020 continues to be generally well tolerated across all 10 participants at both dose levels, and we have not observed any clinically significant complement activations or instances of TMA. We did observe elevations in liver function tests or LFTs in 5 participants treated at the high dose, consistent with what we would expect with gene therapy treatment at this dose. All 5 were treated successfully with modified immunosuppression per the trial protocol. For 3 participants, the elevations occurred following steroid taper and resolved after the reintroduction of low-dose prednisone treatment for a few weeks. In 2 participants, elevations occurred prior to steroid tapering and resolved with increased prednisone and sirolimus treatment. All of the elevations have since resolved without other complications or hospitalizations and no other medications were required for resolution nor were any serious adverse events observed following the LFT elevations. Finally, one previously disclosed Grade 3 serious adverse event of sustained ventricular tachycardia was observed 3 months after dosing in a single participant in the high-dose cohort and assessed as possibly treatment-related, though the event is consistent with the natural course of PKP2-ACM and its known clinical manifestation. The participant was successfully treated with anti-arrhythmic medication and discharged with no additional intervention required and no new serious adverse events have been observed. So we're confident in the favorable safety profile of LX2020 to date. Turning now to the evidence we've collected with cardiac biopsies. On this slide, you can see the robust transduction and transcription observed in all participants. I'll remind everyone that participant 3 in the low-dose cohort declined the post-treatment biopsy, so we do not have any bioanalytical data for this participant. Unfortunately, we did not have sufficient tissue to perform VCN analysis for Participant 1 in the low-dose cohort either. But looking at the available data on the slide, you can see meaningful increases in both vector copy number and exogenous mRNA consistent with PKP2 transduction and transcription. Looking at the mean values, you can also see clear evidence of a dose response. Looking at PKP2 protein expression. Again, we are seeing mean expression increases across participants with a greater response at the high dose. As I mentioned previously, PKP2-ACM leads to the replacement of healthy cardiac tissue with fatty fibrotic tissue, which can contribute to sampling variability and sample quality issues with cardiac biopsy tissue. We believe that it's what's driving the results for participants 4 and 5 because the reduction in PKP2 expression is not logical and both of these participants do demonstrate LX2020 transduction and transcription with the VCN and mRNA results. In these 2 instances, it is likely that we happen to analyze a sample with a greater percentage of fat or fibrotic tissue, which is confounding the Western blot results. But looking across all samples, we are encouraged by the evidence of increased PKP2 expression and dose dependence. Finally, looking at immunofluorescence staining, you can see appropriate colocalization of PKP2 protein at the cardiac intercalated disc after treatment. Essentially, these images show us that PK/PT protein is going to the right place after treatment with LX2020 and it's traveling alongside other important structural proteins in the desmosome and gap junction such as connexin 43 and N-cadherin where you see clear lines, particularly in the merged images, you can see the intercalated disc where cardiomyocytes connect both mechanically and electrically, allowing the heart to beat in synchronized fashion. We've chosen participants 4 and 5 here for illustrative purposes, but appropriate co-localization of PKP2 protein is consistently demonstrated across our patient population. Turning now to the clinical data. We have observed a reduction or stabilization in arrhythmia burden across participants with a greater mean effect in the high-dose cohort. PVCs are reduced or stable in 7 of 8 participants with a mean improvement of 14% at the high dose despite a relatively earlier follow-up. Even more important is NSVT, which is a major risk factor for sustained VT and where we see reduction or stabilization in 6 of 8 participants, including a mean improvement of 22% at the high dose. The most significant reduction in VT in participant 4 also appears to be associated with modest gains in cardiac function as assessed by right ventricular ejection fraction, although the majority of patients remain stable with respect to RVEF. Looking at these data over time, you can see improvements in arrhythmia burden on average and evidence of a clear dose response. On the left are PVCs measured at baseline, 6 months, 9 months and 12 months, including participants who have reached at each time point to date. You'll see the mean across all patients as well as the mean for each of the 2 dose cohorts. The right-hand side presents the same view for NSVT events over time. Looking at the high dose in red, there is clear clinical benefit and a dose response in terms of reducing arrhythmia burden and potential evidence of greater improvement over time. We look forward to seeing these data mature and also adding participants 9 and 10 to this emerging picture. Even with some measurement variability, the directionally consistent improvements observed across measures of arrhythmia burden and cardiac function give us early confidence in the potential treatment effect of LX2020. Finally, looking at EKG data and other clinical measures, participants appear stable over time. You can see the mean per dose cohort and the dots represented individual participants at baseline and latest visits. The left-hand side shows QRS duration. The majority of participants start and stay within the normal range as of latest visit. We have previously reported an improvement for participant 1, which you can see in the purple dot. But looking at across the sample, we are largely seeing stabilization on this measure of electrical function. On the left, T-wave inversion is also largely stable across participants with minimal change from baseline. No participants experienced any change in New York Heart Association class. And in fact, 7 of the 8 participants started at Class I, so they continue to report no signs or symptoms of limitations from heart failure. While these measures remain stable overall, we are most encouraged by the observed reductions in arrhythmia burden, including reductions in more severe NSVT events, which are both clinically relevant and highly meaningful for patients. I'll now turn the call back to Nolan to close.

Thank you, Eric. I believe these interim data demonstrate an exciting emerging profile for LX2020 with favorable safety, robust transduction, increased PKP2 expression and clinically meaningful reductions in arrhythmia burden. In terms of next steps, we recently completed enrollment of the heroic study in Q4 2025 with the final 2 participants, participants 9 and 10 dosed using drug supply produced with our final manufacturing process. This process demonstrates higher potency and higher yield relative to earlier lots. So we look forward to reviewing data for these participants in 2026, including cardiac biopsy data in the near term. Looking ahead, we expect to receive 12-month follow-up data for all high-dose participants by Q4 2026, at which point we plan to provide a subsequent data update. I'd like to close by thanking the study participants, caregivers, investigators and other members of the ACM community who have helped us to reach this exciting milestone. Those impacted by PKP2-ACM are central to our mission, and we are committed to advancing the development of LX2020 given the urgent need for treatment options. I will turn it over to the operator to help facilitate the Q&A portion of today's call.

[Operator Instructions] And our first question comes from Paul Matteis with Stifel.