Pharvaris N.V. (PHVS) Earnings Call Transcript & Summary

Great. Thank you very much, everyone, for attending. I'm Max Skor, a biotech analyst with Morgan Stanley. And before we get started, for important disclosures, please see the Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. And with that, I'm very happy to have the Pharvaris team with me today, Bern Modig, CEO; and Maggie Beller, Head of IR. Thank you very much for joining us.

Thank you, Mike and good to be here.

Great. So maybe we start off. I think this is the third year in a row you've attended. We've sat here at the fireside chat. This is a momentous time in the story of Pharvaris. If you can just maybe step back and give us a brief overview of just how you got here and what are the key steps going forward?

Sure. So actually, our journey or my personal journey in HAE started 23 years ago with not with Pharvaris, but with the company that developed Icatibant and I worked there together with Jochen Kin, who is an inventor of Icatibant. And then as we all know, Shire took over in 2008, and it then became -- still is the most widely used acute therapy for subcutaneous injection. But already back then, we knew that there was patients were looking for better treatments and already then, we were just starting to think about the vision for an oral therapy. And then latest couple of years later in 2015, starting operations in 2016, then Jochen and I started Pharvaris and with the idea to develop an orally available B2 receptor antagonist really from chemistry square one, really from scratch. And we're really excited to what we see today with what came out of that is deucrictibant. And the properties of that molecule, it makes it very different from icatibant. It's a B2 receptor antagonist, but it's to our knowledge, the first and only orally available B2 receptor antagonist. And it also has the properties that make half-life and so on that make it suitable for prophylactic development like [indiscernible] So looking at the therapeutic area over the -- more than 2 decades, you see the big unmet need for an efficacious oral therapy option and there's still nothing approved out there. And we are, of course, hoping that deucrictibant is going to be the first orally available B2 receptor antagonist in oral therapy with a high level of efficacy for people living with HAE.

Great. Thank you very much for that introduction. So when we think about the HAE market, we have the on-demand market, which you also have a formulation for of deucrictibant and then the prophylactic. Let's start with the prophylactic because you just reported impressive Phase III Chapter 3 data. Maybe give us a high-level overview of the overall efficacy profile, and then we can dive into specifics.

Yes. So you saw the data, we had a remarkable 87% efficacy in the type 1, type 2 population of hereditary angioedema. And also the study included it's also part of the protocol patients with normal C1 mutations, other mutations that -- and so the primary endpoint included a small number of such patients and that total primary endpoint and efficacy -- the attack reduction was 83%. So that really means that we are in the area of what we can call injectable-like efficacy. And if you look at the other injectables in the prophylactic space therapies out there, there seems to be almost like a ceiling, more or less maybe not coincidence, but there seems to be like there is a maximum level of efficacy at around 87% and we're very happy to see that with the deucrictibant and it really puts us in a very differentiated position vis-a-vis the others because as I said, we see a huge unmet need for an oral therapy that really provides that level of efficacy.

And maybe if we can dive into the key secondary endpoints. Maybe you can talk about the baseline characteristics and how that compares to competitors in the space. Specifically, I imagine everyone is looking at Orladeyo and how that Phase III lined up versus Chapter 3.

Yes, the baseline characteristics are very similar to other therapies. I mean they're all in terms of attack frequency, they range from, I think, the lowest is the TAKHZYRO with 1.7 and the highest is Orladeyo and we were a little over 2.1, I think it was in our case. And it's -- so it's all very, very, very similar. And...

These are fairly severe patients.

Yes. So I think that's very comparable.

I'll add on that our -- those were our placebo rates in the full 24-week study. For the baseline characteristics leading into the study, our average attack rate was about 3.6. So that is a more severe patient population. So we were incredibly impressed to see the 87% attack reduction given the severity of the patients that we were treating.

And then I guess, after the results came out, there were some questions around the safety profile. We actually hosted a KOL a couple of days later. The KOL was comfortable with the enzyme elevations given the compounding or compounding factors such as androgen exposure, fatty liver. But could you comment on those?

Yes, happy to. In our study, we did see 2 Grade 3 Level 2 liver enzyme elevations. As you mentioned, Max, one of those patients did have fatty liver disease. That was also a normal C1 patient. So that person ended up discontinuing the study drug, but stayed on the study. So we were able to continue their lab assessments. The second patient had previously used androgens. They actually stayed on study and completed the study and then rolled over on to the open-label extension. Both of those patients neither were symptomatic and neither saw elevated [ bilirubin ]. So we were pleased to see that.

Okay. That's very helpful. And then there was one patient, I believe, laryngeal attack any commentary around that?

Absolutely. So that was our Grade 4 finding, which is the same as the serious adverse event in the safety table. This was, once again, a person with normal C1. They had a plasminogen mutation. This person, unfortunately, leading into the study had experienced severe laryngeal attacks. So as many as 19 laryngeal attacks in the 3 months leading up to the study. These attacks required constant intubation. So this was somebody who had been intubated multiple times. Upon start of the study, this person experienced a 90% decrease in their attack frequency. So really impressive efficacy findings there. At one point, they had a laryngeal dyskinesia, which just means that they had difficulty breathing that resulted in them being hospitalized and being intubated. While intubated, they were scoped and it was confirmed that this was not -- there was no angioedema associated. So this was not a laryngeal attack. It was just a result of the frequent intubation prior to the study start. This person stayed on study drug. They completed the study. In fact, afterwards, we reached out to the PI just to see how the person is feeling. They had reported that they were happy with their deucrictibant treatment and actually were able to go back to work. So not only did they experience the improved efficacy, but also improved quality of life. So we view that as a real success story with deucrictibant.

That's great.

Yes. Maybe I should also add to that. I mean it's hard to imagine for any of us here, would it like to have 19 laryngeal attacks and suffer through that. And so this is, as I said, is a normal C1 patient. And so part of our approach here and also as we designed the study was to include, as I mentioned, normal C1 patients. And this is not an insignificant portion of the patient population and also because of -- remind everybody, because of the mechanism of B2 receptor antagonist, that is really the only mechanism that has real efficacy for this patient population.

Can you talk about that opportunity?

Yes. So it's estimated now that approximately 20% of the HAE population is the normal C1 mutations. So that follows a different pathway -- it doesn't go through the kallikrein pathway. So at the bottom of the bet receptor level, then you can really most effectively treat that condition. They do get therapy today with the existing therapies that, that is because the more generalized label for those indications, hereditary angioedema because the normal C1 is sometimes called type 3. It's one form of hereditary angioedema. But with our data now, we hope to have -- to get that also included in our label and also finally a really efficacious therapy for these type of patients.

And are these patients generally managed with on-demand or prophylactic treatment?

I think for the most part, it's on demand today. Many use Icatibant. They also use TD and the other drugs that do get the other drugs of prophylactic prescribe. But not with some modest efficacy or very low efficacy.

And then maybe just going back to the safety profile. How does it compare to Orladeyo? I think on the Orladeyo label, something called out at higher doses, cardiac implications. Any commentary around how deucrictibant compares to that?

Yes. Thanks for the question. That is something that we're really proud of. We didn't see any additional cardiovascular signs. And in fact, we saw one of the major pushbacks that we get for the other approved oral is GI side effects. We did not see an increase in GI risk with deucrictibant treatment and the placebo and deucrictibant are balanced with respect to GI as well. So not only do we have a thorough QT waiver, we put out a lot of cardio safety data, and we were happy to see in clinical studies that there's no additional cardio risk with deucrictibant.

Okay. Now going down the path of potential approval in prophylactic, we'll touch on-demand in a bit. But what have you learned from the Orladeyo experience so far? How are you going to approach marketing, talking to physicians? How should we think about the launch curve?

Yes. So on the Orladeyo, as you know, had a pretty strong uptake. I think -- which is not a surprise to us, because it reflects the fundamental unmet need for an oral therapy. So patients are desire to get away from injections. And I think what we have seen now since the launch of Orladeyo is that there is a very high churn rate. It's very -- many patients drop off after trying it. And I think also in the call, you mentioned -- mentioned that you also wrote about said that 50% of the patients discontinue Orladeyo after within 6 months. And that is -- then go back to the injectables, and that's really simply because of the lower efficacy. So that patient segment, patients who have tried Orladeyo, the reason for trying it is, of course, the desire for an oral and then they go back to the injectables because it didn't do so well for them. With deucrictibant now, they have the opportunity then to try again. So I think that the propensity for that type of patient to try deucrictibant will be very high. And so that's a very clear segment. We estimated some numbers. I think [indiscernible] has also mentioned numbers ranging from up to 1,900 patients that have tried Orladeyo and dropped off. So that's very clear. Then there is a patient population that, of course, are aware of that. They're still waiting for an oral, but they don't want to make that take that risk of starting to having attacks again. So they stay on the injectable and they're waiting for deucrictibant, you can say. So that's a very -- that's another segment that's very logical for us to approach. And then the first-line population, newly diagnosed, it's very logical to start with an oral as a first-line therapy. So -- and that are 150 to patients every year that come into the mix and that kind of accumulates over time. And what we hope to see, of course, is that when somebody starts with deucrictibant that they would be satisfied and then the search is over and there's no need to switch. So then with that building patient population also from the new patients, it accumulates over time. And Chief Commercial Officer like to describe as a pancake effect, but it is basically accumulation of patients coming in and newly diagnosed.

So maybe that leads into the on-demand opportunity. But stepping back and thinking about the prophylactic first on-demand, having dual formulations of the same drug, how are you thinking about the market opportunities for each and then on-demand launching first? How does that help you define the prophylactic market going forward?

Yes. I think -- I mean, we do think that the on-demand market is a viable market also in the future. There are certain patients that prefer to treat when the attack happens. And especially if you have something that's very reliable and simple and again, also in the on-demand segment, same phenomenon. There is an oral therapy but not the optimal efficacy. So I think similar to the prophylactic setting, we hope and expect that deucrictibant will also take over a lot of those patients. And also there are patient population still on Icatibant. And I think that's 65% or something more patients that really are still on Icatibant and what they like Icatibant is the reliability, the efficacy they trusted in the mechanism. But if you have an oral that works as good or even potentially better, then that's a very logical switch from that patient population as well. So it's very similar dynamics. And I think there is a segment of people living with that they want to stay on demand. So we think that's also we're happy that we have both options for patients.

And so in regards to the actual segment breakdown, do you see prophylactic growing or on-demand growing? How does that look?

There are different growth factors. I mean, overall, the prophylactic segment continues to grow. I think that you've seen that is clearly the trend. I think that's also in the treatment guidelines that patients really should be on prophylaxis not to have attacks. So I think that's clearly the trend. I mean I think we've seen that over the years, and I think that continues. But as I said, I think there's still a remaining segment that also where the on-demand therapy option also could make sense. And I think also patients that are able to sort of maybe switch back and forth are also, they're relevant.

Yes. It sounds as based on our conversations with KOLs, it sounds like all prophylactic patients also have an on-demand that they carry with them for breakthrough attacks. How does having 2 formulations of the same drug potentially address that issue?

Yes. So that refers to, I think you can describe as potential combo use. And I think that it's -- the treatment modalities in HAE is in angioedema is really exposure driven. So it's all about maintaining a certain therapeutic exposure. And so unlike some other diseases where you have to approach it from a different side. So a breakthrough attack typically occurs when that exposure and the efficacy is not there. So you're basically topping up with the same drug, which is -- the combo use from a medical perspective, from mechanistically is fine, and we see that as also a potential for deucrictibant.

I'll also add that right now, in clinical practice, people use the same mechanism to rescue their attacks, when they have breakthrough attacks. So right now, if you're on TAKHZYRO or Orladeyo, which are kallikrein inhibitors and you have a breakthrough attack, you treat with Ectorly, which is also a kallikrein inhibitor, that is a well-understood additive process. So for us, we're using that same philosophy of mechanism plus mechanism.

Do you have any -- I'm going to ask you to put some numbers or percentages around that based on what we've learned from the Ectorly launch or what you've learned from talking to KOLs?