Mineralys Therapeutics, Inc. (MLYS) Earnings Call Transcript & Summary

Okay. Welcome to the last session of the BofA Healthcare Conference on day 2. My name is Geoff Meacham. I'm the senior biopharma analyst. And we have Mary Kate Davis for my team on the stage with me as well. We're thrilled to have Mineralys. And speaking on behalf of Mineralys, we have Jon Congleton, who is CEO; and Adam Levy, who's CFO. Guys, thank you. Thank you. Good to see you. So I think, Jon, you're going to just give a bit of a high-level view and we'll get into some questions after that.

Yes. No, happy to. And I appreciate the opportunity to share the story. Mineralys, in simplest terms, is focused on targeting aldosterone as it's related to cardiorenal metabolic syndrome. Our first beachhead indication is hypertension, but we think there's potential for this molecule in things like CKD, heart disease and beyond that. The purpose that really drives this organization daily is create more better days. I personally have -- sort of my career of carrying the bag as a sales rep in this space. And so I've seen the value of innovations, but we haven't had that in about 25 years. So the ability to address unmet need, to get patients to goal, to avert things like dialysis and stroke and heart disease is what we mean by creating more better days. Mineralys itself was formed in 2020, shortly after the licensing agreement for lorundrostat. Lorundrostat was developed through -- discovered and developed through Phase I by Mitsubishi Tanabe. We set out in 2020 to really build the company, do the tech transfer, do our proof-of-concept study that really demonstrated a robust effect on systolic BP. For me, what was enticing about coming back into the organization was not only the novelty of the molecule, but also our approach in targeting and bringing a level of precision to the treatment in cardiorenal diseases that has not existed before. But really, frankly, is the unmet need. Just in the U.S., there are about 118 million people with hypertension, about half are treated. Of those treated, about half cannot get to goal. And there's a lot of reasons for that. Some of it is are they on the right drug, the right dose, are they compliant. But fundamentally, we think there's something else going on and that's dysregulated aldosterone. And why that matters is globally from the WHO, we know about 7.5 million people die per year in things related to or attributable to hypertension. So we're nowhere near done with this mission of addressing unmet need in the hypertension. And aldosterone interestingly, has kind of silently ridden the coattails of obesity. Everybody is aware of the obesity epidemic. But few appreciate the link of obesity in dysregulated aldosterone, probably about 25% of all hypertension patients have abnormally elevated aldosterone, and there are really limited alternatives to address that. Really, the main drug was developed in 1959, a mineral corticoid receptor antagonist called spironolactone. It's frankly underutilized because it has a lot of off-target effects. And we think there is the need for better, improved ways to address aldosterone, and that's kind of the path that we're on right now. Lorundrostat, we think, has the means and the potential to do that. It's, from our standpoint, best-in-class ASI, has the best selectivity for inhibiting aldosterone without affecting cortisol, which has historically been the issue in the development of aldosterone synthase inhibitors. Has an ideal half-life to deliver efficacy once daily, but to do so safely. All of that's been validated at this point in preclinical Phase I and now Phase II proof-of-concept study, where we showed a double-digit reduction in systolic BP relative to placebo with modest impact on potassium. And that's really -- potassium is really kind of on-target adverse event you want to look for. That's where our selectivity in half-life, we think, gives you the ideal mix of efficacy and safety from that perspective. Again, owing to how we're trying to bring a level of precision within that proof of concept, we prespecified some -- what we thought would be determinants of enhanced response. The 2 that really stood out was, one, a synergy with a diuretic. We saw even beyond the ITT reduction, a more enhanced response when a diuretic is used in combination with lorundrostat. And then very clearly, and it's based on the underlying biology, the obese population showed a really enhanced response. So these are things that have informed our pivotal development program. Right now, we're executing 2 pivotal hypertension studies. One is called Advance-HTN and the other is Launch-HTN. In support of that, we have proof-of-concept studies in hypertension and CKD. Advance-HTN, and we'll probably talk about it a little bit in the Q&A, but Advance-HTN is likely the most rigorous hypertension study ever done, just as far as getting subjects on a standardized background regimen of the right drugs, right dose, compliant, gold standard, 24-hour ambulatory as the means of identifying are they truly uncontrolled before we even randomize. That study, I think, will be a seminal data readout for us. It's Q4 of this year. Launch-HTN is really kind of a replication or confirmation of the proof of concept. It's a bigger study. It's global in nature, up to 1,000 subjects probably generating real-world data for us. And then Explore-CKD is the hypertension CKD study that will really kind of fully inform what's the benefit, not only in the hypertension but also in comorbid CKD and proteinuria as a primary endpoint with that. The position that we're ultimately looking to bring lorundrostat into the market, and it's what is the basis of our clinical development program is really a third-line agent for uncontrolled hypertension. So we're not looking to be a monotherapy. We're not looking to displace ACEs or ARBs or diuretics. But when you get to third line, we want to, frankly, deliver a toolkit or a means to guide prescribers and payers and where are those responding populations. And that's tested well within the market research we've done. So the clinical development program really supports that positioning. And then beyond the hypertension, we think there's a great deal of utility for lorundrostat given how pervasive aldosterone is in cardiorenal metabolic syndrome. So very excited to be on the path that we're on. We think the need is there. We think we've got a really significant opportunity with lorundrostat, and happy to address any questions you have.

Yes. Perfect. Let's get into Advance-HTN. So what would you say, Jon, what does success look like? How predictive would you feel based on the results of the larger Launch-HTN study?

Yes. We've -- to put it in context what good looks like, we continue to think about what's available right now. So typically, and this was from a meta-analysis of about 143 studies, when you add a third-line agent of the existing armamentary, you get about a 5 to 6-millimeter mercury improvement. What you typically see is monotherapy. The first treatment, you'll get a 10 to 15-millimeter and then everything else is incremental. We think by targeting and creating that toolkit to help identify, but by targeting aldosterone, we can get to that 8- to 10-millimeter mercury change that we saw in Target-HTN. That's what we're guiding towards with Advance-HTN that we think would resonate. Again, as we've done market research with physicians and with payers, that becomes more transformative. It's not just a little bit of a bump, but it's a significant move and in a targeted way.

And then talk about kind of the background therapy and what that could do to introduce some variability.

Yes. We were fortunate, and we did it by design. So it was kind of predestined fortune. But Target-HTN, because we were studying patients -- this is the proof-of-concept study. Because we were looking at patients failing on 2 or more meds, we actually had a good mix of those on 2 meds, [ dose ] on 3. It was about 50-50. We also had a good mix of those on a diuretic and not on a diuretic. So we got to see that interplay with lorundrostat and a diuretic. So as we think about our pivotal program, Advance-HTN, which is the one that reads out Q4 of this year, we're actually taking people off of their hypertension medications, and we're putting them on to a standardized regimen that follows AHA recommended guidelines. So if people coming in the study are on 2 meds, they get an ARB called olmesartan or -- and a diuretic, both at kind of maximal dose. If they're on 3 to 5 meds, those are taken off, they get the olmesartan, the diuretic and amlodipine, a calcium channel blocker at maximal dose. What that basically enables for us is a couple of things. One, it is going to generate class 1 evidence that will help get lorundrostat into the hypertension treating guidelines. But two, it addresses that question of, hey, if patients were just on the right drug or the right dose and compliant, do we really need new innovation. And I can tell you we do. That regimen is not solving the problem for everybody. And what we're going to see through the course of Advance-HTN is that through that 3-week run in, some subjects are going to get to goal. If they do, they're out of the study. We just won't randomize them. But if they do not get to goal on that rigorous regimen that's tracked for compliance, than we randomize. And what I think that creates for us is 2 things. One, it's a truly -- as close you can get to truly confirmed uncontrolled and resistant hypertension. But I think also, by definition, it's likely to be an aldosterone-enriched population because that standardized regimen is hitting a lot of different drivers of their blood pressure except for aldosterone. And there's some literature that would support a more uncontrolled resistant population has a higher prevalence of aldosterone. Now Launch-HTN, again, is confirming of our proof of concept there. We're going to keep subjects on their background meds. We're going to try to help them be more compliant. Again, if compliant on their meds, they're still uncontrolled, we randomized them. So that's probably built more for the PCP. It's the real world. We're using in-office blood pressure measurement. But Advance-HTN is really probably targeting cardiologists, endocrinologists, nephrologists that are really getting the tough-to-treat patients and will be really considerate of the data that we're creating.

Great. I guess, looking at the Advance-HTN readout later this year going into potentially a third line here, could you talk a little bit about your expectations for safety for this readout?

Yes. The on-target, there's really 2 potential on-target safety things we're looking at. One is cortisol, which has been a challenge with this class of drugs historically, now through preclinical, through Phase I, through Phase II. We have a lot of confidence that the selectivity is bearing out, that we're seeing about a 70% reduction in aldosterone and really no inhibition to cortisol. And that's basal and that's stimulated. So that's -- we do the stimulation tests with ACTH, and there's no inhibition. So that's one. We're continuing to monitor that, continuing to track it. The other one is around electrolytes. And so that's sodium and potassium. That's really where aldosterone has its effect. Adlosterone in an elevated state retains sodium, retains water, increases blood volume, increases blood pressure. We're going the other way, where we're basically pushing sodium out, blood volume goes down, blood pressure goes down. That way, you're retaining potassium. And so you want to make sure that in exchange of that big blood pressure reduction, you're not seeing a big spike in hyperkalemia. We didn't really see it with the 50 milligrams in Target-HTN. We think the combination of its selectivity and its half-life, which is about 10 to 12 hours, really is kind of an ideal profile to get the efficacy, but potentially allow a little bit of an aldosterone inhibition escape period during the sleeping hours because we do see pretty much complete suppression of aldo through about 14 hours, and then it begins to rise, comes up about 30% from the baseline level. Do I get that right? You always have to correct me.

Yes. So about 70% suppression after 24 hours right before the next dose.

Yes. And so we think that actual allowance of aldosterone to kind of build back up allows a little bit of a clearance of potassium. But that's really the main thing. So cortisol, potassium and sodium are what we'll be looking at from a safety standpoint in both studies.

Just had a quick follow-up on the -- your payer work. So if you look at the 2 settings, right, a refractory population and more of a primary care front end, does the payer value getting to goal differently between those 2 settings? Have you done that kind of analysis?

Yes. We've done that research, and -- so the most recent payer research we did, we had 30 payers. And as you're well aware, Geoff, there's not a payer. We looked at about 10 IDNs, we looked at 10 PBMs. We looked at 10 health plans. The IDNs were actually when we show them the profile of about 10-millimeter mercury drop in systolic BP, modest impact on potassium, reasonable price and all that, the IDN said third line, yes, maybe even second line. The PBMs, the health plans are a little bit more circumspect and it varied between third and fourth line. So I think where our goal of third line is how we're building out the profile, how we're doing the clinical development. I would anticipate we'll see some resistant hypertension. So fourth line by some payers initially. Some will be a third line where we think it's ideal and then that will build over time with experience.

Right. I guess, just following up on the Launch-HTN study and you've already talked a little bit about how the background therapy is different from Advance to Launch. I guess do you expect this to kind of change your goal of maybe 8 to 10 millimeters of mercury for the efficacy for the Launch section?

Yes, I don't really think so. To a large degree, Launch is a replication of Target-HTN, [ a bit ] larger and a bit longer, right? So Target-HTN, we had about 200 subjects. Launch-HTN, we're up to 1,000. Target-HTN was 8 weeks, Launch was 12 weeks. What gives us comfort that we're going to be able to replicate that 8 to 10 is we're taking the learnings from Target, again, where half the patients were on a diuretic, half where we know there's a positive interplay with the diuretic. All subjects in Launch will -- even though they're on existing meds, one of those existing meds needs to be a diuretic. So we're bringing that advantage from Target into Launch. And so we're fairly confident with everything that we learned from Target-HTN, not only about lorundrostat but about how to conduct and construct the study. We've done that in Launch. So we remain pretty confident with that 8 to 10. We'll see about adjusted figures what we're going to see with Launch-HTN.

Great. I guess, just one more for me right now about just the ongoing clinical trials. Could you touch upon your open-label extension trial and what you're looking to see from that?

So the open-label extension study, it's omnibus. So subjects not only from Advance and Launch go into that, but also Explore-CKD. And the main purpose of that is just the long-term safety. We've had good dialogues with the FDA really from the beginning. We're confident that the size of the pivotal program, barring any unforeseen safety signal that may pop up is probably appropriate. But that's why we're collecting that longer-term data. Now within that, we're going to continue to monitor blood pressure. We're going to continue to monitor other markers. Looking at the durability of the response is going to be a key component of that. So those are really the main things. Safety is really the big primary driver.

From a market perspective, I always have to ask the sort of the GLP-1 kind of question on -- I mean, they haven't -- the drug company, the pharmas haven't necessarily officially gone after hypertension as an indication. Probably is a matter of when not if, but we had a dinner last night with Lily and that -- it's on their radar. But with that as a backdrop in the marketplace, like how do you see the impact kind of settling out for lorundrostat?

Yes. I think there's -- we know and have known for decades. If you lose weight, your blood pressure is going to come down. And at this point in time, I think the predominant benefit of the GLP-1s at least as it would relate to hypertension is probably that benefit, right? You lose weight with GLP-1, you're going to see a reduction. I think one of the tirzepatide studies tracked and follow that, showed about a 6- to 7-millimeter mercury drop in systolic BP. That's kind of in line with historically what we've seen with diet, exercise, things like that, which is great. But the fundamental goal is not lowering the BP, it's getting the BP to goal. And the goal is 130 just in kind of a standard hypertension subject. But if you have any comorbidities, the goal is 120. And I think in due time, 120 is going to be the number for everyone. The U.S. is a little bit more advanced in that than Europe is. But with that said, the benefit you see with the GLP-1s is great, and it's meaningful, but it's not sufficient. There's going to be more there. I think fundamentally, we actually see the GLP-1s as more collaborative than competitive. I think there's going to be for an obese subject where we've seen a clear correlation of response, their weight loss is going to be great for them, but it may not get them all the way down to a BMI below 25 or 22. And so we think there's clearly going to be a fit of getting the benefit of the GLP-1, but also needing the benefit of lorundrostat given its specificity within that population.

Yes. I think even in the case of the Select study or for semaglutide, you saw obviously good weight loss, but very varied effect on stroke was only 7%. Like there's -- so -- and even -- I don't remember off the top of my head what the blood pressure benefit was, but I know you -- the cardiac benefits are not consistent. So having a clear pressure effect would help.

Well, and to your point, I think the cardiac benefit, I don't know if it was Select or [ some out ] there's -- like every week, there's a new study coming out. But the cardiac benefit of 20%, again, meaningful, but there's still residual risk. I think the placebo group had 8% risk of cardiovascular event and the GLP-1 had 6.5%. So a good meaningful reduction, but again, not sufficient. So that's where it's good, we need better.