Prelude Therapeutics Incorporated (PRLD) Earnings Call Transcript & Summary

Okay. My name is Peter Lawson. I cover Prelude Therapeutics and a number of companies in this mid-cap oncology space and I&I space. And really pleased to have on stage with us, Prelude Therapeutic CEO and Founder, Kris Vaddi and also Jane Huang, Chief Medical Officer. And I guess first question is really around kind of the macro and kind of the impact of the current administration kind of your views on anything that could be disrupted in the supply chain as we kind of think about tariffs, et cetera?

Yes. So I think -- I mean, at the moment, we are kind of deer caught in the headlight situation. We just -- we're just dealing with all the things that are happening on a regular basis. But as far as I'm aware, the state of the company, we are, I'm not sure the tariffs themselves will be that impactful for us at the moment. Clearly, being able to source the materials for our research and development, those are we just have to see how any of these new policies are likely to impact. I think it's -- we're really early days to really to know. From the regulatory standpoint, obviously, there's going to be a lot of changes. But again, we just have to see what the policies are going to be as we as we get further into...

I just add like -- as Prelude, we have anticipated some of this and tried to protect against it, so that we have some manufacturing and the API all ready to go. And we've thought about these implications and [indiscernible], so that we are prepared. So we don't think in the short term that it will have any impact on us as a company.

Did COVID kind of give a prelude to this essentially because of the supply chain disruption?

Supply chain, FDA inspections, et cetera.

And have you heard any worries about the FDA? Have you had a slowdown in any kind of communication with the FDA or any changes in those meetings?

We haven't had any recent interactions. So, anecdotally, I haven't heard of anything. I know that they're retaining all the people that they need to, to make sure that drug development moves forward.

And I know recently, just as recently as a couple of weeks ago, there was a good representation from pharma CEOs to FDA, making sure that they hear our points of view in terms of potential impacts, if there were to be too many cuts or other things that are made. Because we really depend on FDA being able to right, give us the feedback on the things that we ask them for on a timely basis, and we plan everything accordingly. So we're very hopeful that the new administration is aware of our needs and hopefully, any changes that might happen, we'll take them into account.

Got you. I guess a final macro question before we kind of bring it back to you and kind of maybe a few points that kind of frame the discussion. But on NIH budgetary cuts, are there any kind of trickle-down effects that we should be worried about? Is that going to impact any of the projects you're running, or even in clinical trial sites?

Yes. I mean from the clinical trial side, we're certainly watching what the universities are doing because we know that there's been some caution. At the same time, we are often independently funding most of the research. And so that's really had no impact in terms of, that I can see directly from patient enrollment, et cetera, in the recent months. We've been tracking along as planned.

I would -- I mean for the short term, yes, we had good plans, and so we're probably not going to be impacted. But -- the one thing that is going to happen though, with NIH experiences a lot of cut is there's a lot of fundamental research that actually supports our ecosystem, right. The reason why the biotech industry is as strong as it is in the United States is because of the groundbreaking research that they do and the symbiotic relationship that we have. I know from first-hand experience a number of friends who've been in academia, who are funded by NIH are actively looking for jobs outside, are very concerned about the future. So I mean it's going to impact it, but it's probably going to be longer term than an immediate term.

Okay. And maybe before I dive into my questions, Were there any kind of opening remarks you wanted to make? Or we can...

Yes. No, absolutely. I'd just like to take the opportunity to thank you for this opportunity to participate. And just as an intro, Prelude Therapeutics is a clinical-stage targeted oncology company, developing novel first-in-class medicines for patients who really don't have effective options today. And we've built this team from scratch to be able to really discover and develop these agents, these medicines. And the team is really pretty broad that we have exceptional medicinal chemistry, cancer biology and clinical development capabilities. And we're really developing various classes of therapeutics, degraders allosteric inhibitors and even precision antibodies, because not every mechanism that is driving these cancers is amenable to a single line of therapy. So we're not a kinase company or a technology company. And we're going to spend obviously a lot of time in the lead program, which we're very, very excited about. It is -- these are degraders that go after SMARCA pathway that is really present in a very wide range of cancers up to 5% to 10% of cancers. And it's been well known that there are two members in this pathway, 2 and 4, SMARCA2 and SMARCA4. And it's been well known that this is important for cell survival. And cancers have somewhat coopted in this pathway, and many of them developed these market for mutations. And in fact, that allows us an opportunity to go after 2, because you need one or the other to selectively hit the cancer, right? That's really the idea here. And while the science had been there and ideas have been there, it's really to have those molecules, small molecules that we can give to patients that actually can go after the cancer has been elusive, and we are really excited to be the first ones to advance, not one but two agents into the clinic, which we're going to talk about. 3789, which is an IV administered once-weekly medicine that we advanced into clinical development in '23, and we've generated some really compelling and validating information in the clinic, including first clinical POC for this mechanism and really focusing on the tumor types where we have the best opportunity. But we didn't stop there. We recognize that -- there potentially is an opportunity for an oral therapy as well based on the patient needs, pathway, et cetera, and advance the second molecule, 7732 to the clinic late last year. And there's been a great enthusiasm from investigators. It's a very high unmet need. These patients don't have other actionable mutations or other approaches. So we feel fortunate to be in a position to advance these and 2025 we're really focused on advancing these programs to key inflection points. And the research is still going very strong. I'm excited and looking forward to potentially talking more about some of the things that we're doing in the research as well.

Got you. And then as we think about your lead molecules 3789 the degrader the IV version of it. Kind of -- how much time does it take for these responses to deepen and kind of as time going on, do we see deeper responses? Just kind of your take on durability and the depth of those responses over time.

Yes. So a little bit depends on the disease type. So the esophageal patients that responded very early on to our IV. They had very brisk responses and they were PRs at the first scan. The lung cancer patients took a little bit longer. They were they -- but over time, we have one patient who has maintained their PR and slightly deepened their response for over 8 months at this point. And this is far and beyond what they had gotten from their prior therapy. So we are seeing in those patients that have acceptability to this pathway that those loss of function patients that we are targeting that the responses are good and are exceeding what I might expect for this patient population, not just by responses, but also durability and stable disease continuing on for quite some time.

And maybe you can help level set us just on to patients where you've seen data so far? Kind of what kind of response rates would you expect and where your response rates and likewise for the durability?

Yes. So to -- if you think about lung cancer, in particular, in second line and beyond docetaxel in all comers would be 10% to 15% response rate. If we extrapolate from what we know from the frontline experience with SMARCA4 mutations, those patients respond about half if you have a SMARCA4 mutation. So in front line, your overall response rate to chemo-immunotherapy is 40% if you're a wild-type and it's 20% if you have a SMARCA4 mutation. If I were to extrapolate that to the docetaxel experience, 15% docetaxel, half of that would be 7.5%. So I would be expecting single digits in the Phase I patient population in patients who have these SMARCA4 mutations.

And do you expect a typical dose response curve from the data as you dose escalate or...

I think the data that we've shown that is showing that we are having more responders at the higher doses. It is a complex interplay probably with between how much SMARCA2 you have in the tumor tissue? How much you're degrading and at what speed you're degrading? So -- and the duration and depth of degradation. And -- but we are seeing a dose response curve as we keep going, not only in exposure, but also having the extra responders show up. The gastric patient that we've added since the triple meeting as a responder, really, they've deepened their response over time, and they were at the 500-milligram dose.

And then as we think about these Class I, Class II mutations kind of what's driving the difference in those response rates?

Yes. So going in, we already knew that there were patients that did not have loss of function of the SMARCA4 protein. And they were going to be less likely to respond, but we wanted to understand the biology carefully and be able to dose escalate quickly. And so we've learned quite a bit. We know that similar to the preclinical hypothesis that clinically, you do need that loss of function in order to see activity.

Okay. And the dose limit in toxicities, have you seen any so far? And kind of when do you think you'll get the recommended Phase II dose?

I'm really excited by the most recent data because we've basically shown that as we've dose escalated, we haven't seen any further toxicity. We had no DLTs so far. We only had one infusion-related SAE. And so this is very tolerable and that recapitulates our preclinical hypothesis that, having that exquisite selectivity that very good selectivity for SMARCA2 degradation will translate into a very good therapeutic index. And so this is -- we are imminent, I would say, in deciding the dose. We are going to be meeting with our investigators to thinking about next steps and how we move the program forward for the IV.

And will you have to do Project Optimus, 2 doses? Or do you think, you kind of handle that with the dose escalation?

We would have to add some patients before registration most likely, sometimes people do it during your registration-type trial. And those are the things we'll be considering as we move the program forward, with the monotherapy.

Got you. And do you think you do get to them like a maximum tolerated dose? Or is there something, very clean [indiscernible] approach...

We have not, to this point. So that's why I say we will be looking at the complex interplay between all the different factors to decide on our dose because at the end of the day, you do need to pick a dose. And seeing that we had responders, an extra responder at 500 may not need to continue to push the dose higher and higher.

Because we may not. I mean, for a certain pathway that you're really hitting mutation or a genomic lesion, you may not ever get there, right? But I think we're triangulating. We have all the information we need and we should we should be pretty comfortable with the doses we want to take forward.

And how would you move it forward as regards to patients, indications, the class of mutation?

So while I do believe that there's probably more tumor types that would be susceptible to this pathway and are dependent on this pathway. We know from our clinical data, the lowest hanging right now is the upper GI and the lung cancer patients. And what we need to do is also because we have the additional oral that's in the clinic, think about which is the most expeditious way to move forward. There's probably multiple different considerations, whether or not we wanted to do IV for things like esophageal cancer where patients might have more trouble following pills. That might be one pathway and then you save the oral for lung cancer. So there are many different permutations we are iterating and then we'll see where the data drives us.

When is the next data update we should expect?

We've disclosed that it will be the second half of '25.

And that's medical conference or...

Medical conference. Yes.

Perfect. What's the kind of internal benchmark you need to move forward?

Yes. So as I mentioned, like the docetaxel, if standard of care would be single digits, I think, in the 20% to 30% range would be extremely interesting.

Perfect. And then just on the IV combination kind of where are you in that process with dose escalation?

We're very close because we were -- again, we try to keep learning as we conduct our trials. And so as the -- it's at 500 milligrams in combination. The monotherapy was 665 sic 665 milligram. So it's very close behind, and we will give an update on the activity at also second half. We just presented at GSMO that again, the safety profile is very clean. The only things we've seen are mainly docetaxel related adverse events, which is like the neutropenia, some fatigue.

Okay. And just broadly speaking, the combinability is really a very, very important aspect in cancer drug development. So many drugs you couldn't dose them high enough in combinations, because of overlapping toxicity and having an agent that actually can be verily combinable gives us additional options and the way we think about developing this agent.

Got you. Have you seen a dose response there? Or do you expect to see a traditional dose response? And then you get increasing number of dose interruptions as you go up in dose?

If you look at our data, we haven't really seen any related dose interruption other than it's almost the same as what I had described at INA. So it's the same -- there was 1 fatigue, 1 AST and 1 ALT and the patient that had liver mets. So the profile that we just presented is very similar, and we haven't seen with increasing doses or dose interruptions per se.

Do you think activity is additive, synergistic or somewhere in between now?

Preclinically, the chemotherapy has with docetaxel has a synergy. So that's why we're very pushing forward the docetaxel combination because our preclinical model thinks we can even drive more benefit.

Okay. And then maybe if we can move on to the oral degrader and does that ultimately just replace the IV? Or how do you think about moving forward with these two?

No, I think we're just going to -- at this point in time, Jane referred to this earlier. There may be an opportunity for both. But we are learning about how oral could be better, right. By giving it daily, if you're able to drive the target down to much, much more deeply than IV, you may see better responses in which case -- in certain cases, we may just go with oral. Whereas in other cases where if you simply cannot go give oral, esophageal or others. You may need IV therapy. So I think we'll let the data help us defining which direction we go.

And there's a difference in the degrader that's used between the two. Is that right?

They're different molecules. So one is a the cereblon-based, which is the oral, which is typical and one is VHL-based. So that also is a different variable, but we don't think that's going to affect the activity per se. It's just -- it's a different molecule.

And so that allows it to be as an oral or IV or are there other kind of additional components that you get from switching the degrader?

Go ahead.

No. It's just that that's with VHL ones are harder to give oral. Go ahead.

Yes. So you can't get the oral bioavailability that you needed with the VHL. So it was really we needed to switch to the cereblon, which is typical for the degraders. So most of the oral degraders are cereblon-based.

And kind of how is enrollment proceeding and kind of where are you for like backfilling various different cohorts?

So we are not -- we have not yet disclosed where we are with oral, but what I've said is I'm very happy with how it's going. I have a good team that executes well and really the investigators remain highly enthusiastic about this pathway given what we have seen with the IV. So the oral is going well, and we will share a little preliminary data toward the end of this year.

And do you think from your experiences have the same therapeutic window or different as you look at those IV versus oral?

I think it is recapitulating what we had said from the preclinical work, and we're really happy with how that's playing out in the clinic.

Got you. And with like a few minutes left on the clock, I just wanted to touch upon the antibody degrader platform and kind of where you are and kind of where we start to see Phase I trials? What they look like and what you want to achieve with those?

Well, I mean, first, this is really -- first, we all have to acknowledge, this is entire new modality, right. It required -- so we formed a collaboration with AbCellera in '23 to go after initially to extend the reach of SMARCA2/4, beyond just these cancers with these mutation. It required engineering, super potents 2/4s and attaching them to the antibodies. The team has done a phenomenal job. We presented some preclinical POC last year. And both AbCellera team on the antibody side, and our team on the degrader side are working very well together. So we -- we hope to make some announcements in terms of where we are towards the clinical programs sometime this year, co-working very closely with AbCellera. In terms of time lines, as you know, these ADCs have longer lead times because we just have to make the cell lines and the antibodies, et cetera. So -- so as we get closer, once we declare the development candidate, we'll be able to give some more clarity around the time lines for that. But SMARCA2/4 is the one of degraders that we're currently pruning to arm the antibodies with. So we have -- team has some really exciting ideas that we are advancing. And so it is clearly an area for ADCs for the next generation, to sort of circumvent some of the payload-related resistance pathways, payload-related toxicities that we currently have with the chemotherapy payloads. So there is actually -- as a field, there's a great deal of interest in that and we have the opportunity to have two highly technical teams working together to do this to really create a leadership position. And so very excited about that.

Is that something you partner to take forwards or...

So the AbCellera relationship is that we are 50-50 partners, in this, the economics are shared. We are responsible for the small -- the payload side of things as well as the clinical development and regulatory aspects. And AbCellera is responsible for the antibody side of things. And so yes, teams work very, very closely all the way from the sort of ideation through development.

Okay. Got you. And just in the sense that it's a very broad platform. So I'm just curious if there must be plenty of ideas coming out. So would that potentially drive in a partnership between your partner?

Yes. There is -- in this capital environment, obviously, we are going to be looking at every possible way to continue to resource these programs, right. Because at this cost of capital to be able to do what we need to do is challenging, as you can imagine. So there is a lot of interest in the research we're doing. And so we are evaluating opportunities to potentially create partnerships around the platform as well.

Great. Thank you so much. Always a pleasure, chatting.Thank you, Kris. Thank you, Jane.

Thank you.