Rani Therapeutics Holdings, Inc. (RANI) Earnings Call Transcript & Summary

Welcome to the Rani Therapeutics RT-111 Phase I Study Top Line Results Conference Call. [Operator Instructions] As a reminder, this call is being recorded today, Monday, February 5, 2024. I would now like to turn the conference call over to Laurence Watts, Managing Director at Gilmartin Group. Please go ahead.

Thank you, operator. Joining us on the call today from Rani Therapeutics, our Chief Executive Officer, Talat Imran; Arvinder Dhalla, VP of Clinical Development; and Chief Financial Officer, Svai Sanford. Please turn to Slide 2. During this conference call, management will make forward-looking statements that are subject to risks and uncertainties related to the future events and/or financial performance of the company. These forward-looking statements are subject to a number of risks, uncertainties and assumptions such as, but not limited to, those discussed in the Risk Factors section of the company's filings with the Securities and Exchange Commission, including its annual report on Form 10-K and quarterly reports on Form 10-Q, which identify the specific factors that may cause actual results or events to differ materially from those described in these forward-looking statements. These factors may include, without limitation, statements regarding product development and clinical trials, product potential, the regulatory environment, certain business strategies, capital resources or operating performance. Actual results and timing events could differ materially from those projected in such forward-looking statements. With that, I will turn the call over to Talat Imran, Chief Executive Officer of Rani. Talat.

Please turn to Slide 3. My name is Talat Imran, and I'm the CEO of Rani Therapeutics. I'm joined on today's call by Arvinder Dhalla, our VP of Clinical Development. Turning to Slide 4. Rani Therapeutics is a clinical-stage biotech company that has developed a platform technology for the oral administration of biologics with bioavailability comparable to a subcutaneous injection. The RaniPill platform is designed to address any therapeutic area where biologics are used. Our current focus is on immunology and endocrinology with discovery efforts underway in obesity and other therapeutic areas and drug modalities. Now on Slide 5. We currently have 4 programs under development in our pipeline. Our focus today will be on RT-111, an oral ustekinumab biosimilar for which we have just successfully completed a Phase I study. Ustekinumab is a human IL-12/23 monoclonal antibody. Currently, ustekinumab is available only as a subcutaneous injection and is marketed in the United States by Janssen as STELARA for the treatment of moderate to severe plaque psoriasis, active psoriatic arthritis, moderate to severe Crohn's disease and moderate to severe ulcerative colitis, all of which have large unmet medical needs for an oral treatment. Sales for STELARA were approximately $6.4 billion in the United States and approximately $9.7 billion worldwide in 2022. Please turn to Slide 7. With that, I'm going to turn it over to Arvinder Dhalla to walk through the details of the study.

Thank you, Talat. Hello, everyone. My name is Arvinder Dhalla, and I'm VP of Clinical Development at Rani Therapeutics. I'm delighted to share the exciting data of our Phase I study showing for the first time, oral delivery of ustekinumab biosimilar antibody via the RaniPill. Let's begin by going over the objectives and design of the study. Please turn to Slide 8. The goal of the study was to obtain PK of ustekinumab biosimilar delivered orally via the RaniPill capsule. The study was conducted in healthy volunteers in Australia. The endpoints of the study were PK parameters of ustekinumab biosimilar and safety and tolerability of RT-111. Please turn to Slide 9. The study was conducted in 3 groups, 2 of those were RT-111 groups at 0.5 and 0.75 milligram dose levels and a control group, given STELARA as a subcutaneous injection at 0.5 milligram dose. We enrolled 15 subjects in the subcu group and 20 each in the 2 RT-111 groups. Turn to Slide 11. Diving right into the data, shown here are the PK profiles and PK parameters for ustekinumab in the 3 groups, data in green is a subcu injection of STELARA at 0.5 milligram dose, and the PK curve is in line with the published literature and delivered ustekinumab biosimilar in a dose proportional manner as shown in purple colors. These PK profiles are consistent with our preclinical and other previous data for antibodies delivered via the RaniPill in that Cmax was reached earlier compared to the subcu injection. In fact, the Tmax with RT-111 was notably shorter than subcu injection. The AUCs for the 2 0.5 milligram groups are quite comparable, resulting in a bioavailability of 84% by Rani route of administration compared to the subcu route. Please turn to Slide 13. This slide shows the incidence of adverse events in the 3 groups. RT-111 was well-tolerated with just a couple of adverse events observed in the study, which are mild and transient and resolved on their own. Similar to our previous studies, there were no serious adverse events noted in the study and no subject reported difficulty swallowing the capsule. The capsule remnants passed out in all subjects without any issues. With these data, we have now dosed 232 RaniPill capsules in human subjects in preclinical studies and have not observed any serious adverse events related to the platform. Please turn to Slide 14. Even though this was a single dose study and the number of subjects is small, we evaluated the incidence of ADAs, which is shown on this slide. Overall, the development of ADAs was not meaningfully different between the 3 groups. Please turn to Slide 15. To summarize, what we have shown is that RaniPill delivered ustekinumab biosimilar antibody in healthy volunteers without any serious adverse events and with high bioavailability. We are very pleased with these data. To our knowledge, this is the first clinical evidence of oral delivery of a monoclonal antibody with such high bioavailability. With that, I'm going to hand it back to Talat, who's going to share our future plans for this program. Thank you.

Slide 16. Thanks, Arvinder. Now that you've had a chance to review the data from our RT-111 study, we're going to switch gears and share with you our perspective on the target product profile for RT-111. Slide 17. First, some context on the psoriasis landscape. Here you see a table of select injectable biologics and their respective dosing frequencies, targets, revenues and PASI scores. PASI 75 for context means a 75% reduction from the baseline psoriasis area and severity index. What is clear is that STELARA, while disruptive when it launched, suffers from low near-term PASI 75 stores as compared to newer entrants. This is something we intend to address with our loading dose regimen. Turning to Slide 18. The limitation of oral therapies for psoriasis, both approved and potential are illustrated in the table on Slide 18. Current therapies like Otezla and Sotyktu suffer from low efficacy rates as compared to injectable biologics. Newer oral therapies have the potential to improve outcomes. However, they require daily or twice daily dosing. RT-111 has the potential to provide patients with the efficacy of a monoclonal antibody in a dosing schedule that has not been achieved by other oral therapies. Now on Slide 19. On Slide 19, you can see the results of a Phase II study conducted by Centocor, a Johnson & Johnson & Company during the development of STELARA. 4 loading doses were tested from 45 and 90 mg single doses to weekly doses of 45 and 90 mgs for the first month. PASI 75 and PASI 90 scores were assessed at week 12. Highlighted in Slide 20 in the rightmost column are the PASI 75 and 90 scores for the weekly 90 mg dosing schedule. As you can see, efficacy dramatically improves from left to right, achieving a PASI 75 score of 81% with the highest and most frequent dose. This is a 55% increase relative to the dose ultimately selected by Centocor and Janssen, the single 45 mg dose on the left of the table. Now on Slide 21. Interestingly, patients reporting at least 1 adverse event actually declined with higher doses as highlighted here on Slide 21. The nature of adverse events was similar across all doses. Slide 22. Based on simulation work we have conducted, a 12 mg daily dose of ustekinumab for the first 30 days has the potential to approximate the 90 mg weekly loading dose schedule described in the previous 3 slides. Turning to Slide 23. We've discussed the loading phase in prior slides, which is critical given that new patients typically start therapy in the middle of a serious flare-up, one that justifies the use of a biologic. Ultimately though, most patients will transition to maintenance dosing. And after review, we believe there is potential to improve upon STELARA here as well. As you can see in the simulation of steady-state STELARA, serum concentration regularly goes below the therapeutic floor at the end of each treatment cycle. Turning to Slide 24. We have modeled a monthly short course of pills for maintenance dose with RaniPill, and we believe that just 3 pills at the beginning of each month has the potential to substitute for both 45 and 90 mg quarterly doses of STELARA. Unlike injectable STELARA, however, according to the simulation, serum concentration is actually more predictable and remains within the therapeutic serum concentration balance for the entirety of the treatment period. Slide 25. In summary, we plan to explore a target dosing regimen that begins with a 30-day daily loading dose followed by just 3 pills at the beginning of each month in maintenance. Slide 26. RT-111, with the dosing schedule described on the prior slide has the potential to be highly differentiated as compared to both current and future oral and injectable options. Slide 27. As a reminder, the ustekinumab biosimilar used in our RT-111 program is supplied by Celltrion, a global biosimilars developer. Rani and Celltrion entered into a long-term supply agreement at the beginning of 2023. This partnership was expanded to include an adalimumab biosimilar in the middle of 2023. In both cases, Celltrion has the right of first negotiation to acquire commercial rights to both programs after the completion of their respective Phase I studies. We've now reached that milestone for the RT-111 program. Celltrion is an excellent partner and as evidenced by the expansion of our partnership, shares Rani's mission of making oral biologics a reality. We would be excited to work more deeply with Celltrion, but as we have hopefully articulated in this presentation, we feel the potential product profile of RT-111 is worthy of development regardless. Now on Slide 28. In summary, the RaniPill platform has the potential to combine the efficacy, specificity and long half-life of a monoclonal antibody with the convenience and dosing flexibility of a pill. The combination of the 2 could create products that we believe are as of now impossible to replicate with any other oral formulation. Rani intends to identify additional opportunities where there is a potential to create better products in terms of efficacy, safety and/or dosing schedule as compared to the originator. Slide 29. We are incredibly excited about the prospects of RT-111 and oral ustekinumab biosimilar. With that, operator, we are ready to take questions.

[Operator Instructions] Our first question comes from Julian Harrison with BTIG.

Congrats on this update. It looks like based on your modeling with multiple dosing, you would expect meaningful advantages in trough PK versus STELARA. I guess I'm curious if you could talk more about how much you would expect that to contribute to potentially improved efficacy in the maintenance setting?

So there isn't -- Julian, first of all, thank you for the question. This is Talat Imran. There isn't a lot of precedent for it in the data from the clinical studies that Janssen ran. However, we know from speaking to our KOLs and even from Celltrion in their conversations with clinicians that patients are regularly being dosed with the 90 mg to improve maintenance PASI scores in all ways, not just for patients above 100 kgs. So our expectation is that just by staying within the serum concentration balance at a higher level, that there's a potential to improve the PASI scores. And then that's also why we're looking at doing perhaps 7 and 12 mg, the higher dose of 12 mgs in all patients because as you're alluding to, there is a potential to improve those PASI scores.

Great. And sorry if I missed it, but timing of progression to potential proof of concept in psoriasis. What are the contingencies there? Are you expecting feedback from Celltrion? Would it be a regulatory gating step at this point? Are you able to lay that out for us in more detail?

We're not able to lay it out at this time. We're just -- we've just wrapped up the study and we are reviewing the data and plan to have a pre-IND meeting as a next step. And I think that will give us enough clarity that we can update the market on.

Our next question comes from Mitchell Kapoor with H.C. Wainwright.

Congrats on the data. The first question I have is regarding the bioavailability. You note that there's 84% bioavailability of RT-111. I was wondering if you can kind of contextualize that with relation to RT-102 versus Forteo showing 300 to 400x bioavailability at the single dose.

Sure. Mitchell, I guess the context here is RT-102 is a short-acting peptide, and we've seen more variability and relative bioavailability to a subcu with peptides because of their short half-life. The antibodies we've tested and preclinically have all looked virtually the same as what you see in the RT-111 data, faster Tmax, higher Cmax and AUCs that are roughly equivalent. So [ relative ] to other monoclonal antibodies, this was exactly in line with our expectation.

Okay. Great. And then could you just talk about the potential for a 505(b)(2) pathway for RT-111? Is that something you would think about approaching the FDA about? Or are you thinking about it differently versus RT-102 in that standpoint? And does adding a loading dose create any issue with approaching them with about a 505(b)(2) pathway.

Right. So the 505(b)(2) pathway is not open for this program given that it's a monoclonal antibody. It's larger than 40 amino acids. So this is why we wanted to engage with the biosimilar that was getting the injectable approved having Celltrion as a partner means there's a potential. This is something we have to explore with the regulators of doing a supplement to their BLA, assuming their biosimilar is approved. And then to your second question around the loading dose, yes, we would have to do additional work, but we are selecting a dose that has already been tested previously in the Phase II. So again, this is going to require a conversation. I can't give any certainty on that at this point. But what I can say is that looking at the results from that Phase II that I referenced during the presentation, it seems worthwhile because there's a potential here to make a significantly better product that is no less convenient.

Okay. Yes, that's very encouraging. And then the last one for me, I just wanted to ask about with the differences in the products that you're putting into the RaniPill, could you just talk about what kind of overlaps and differences you might have between programs in respect to getting each program to an NDA? How could you potentially save time amongst the differences in the respective programs, but also kind of what are some of those nuances that each program might require difference in the regulatory pathway?

Right. So there are differences in regulatory pathway only as it pertains to the status of the drug. What I mean by that is, if it's already approved, and there's a data package that we can borrow from either the originator or from our partner, that's going to be quite a bit easier. In cases of NCEs in the future, it's very likely we'll be moving those forward in RaniPill, then there's going to be more required, right? There'll be a difference between those programs and the ones where it's a biosimilar or an approved product, where it's a life cycle management situation. But that's the primary difference because the RaniPill itself does not change from program to program. So the data that we collect on the platform, the verification and validation work we do for the RaniPill device itself [ the same name ] in all programs.

Okay. Great. And congrats again.

Thanks, Mitchell.

Our next question comes from Andreas Argyrides with Wedbush Securities.

Congrats on the results. The incidence of ADAs were notably low. So to what extent do the results continue to derisk the [ RaniPill seeking ] to on delivery standpoint? And then I have a follow-up.

Sure. Andreas, good to hear from you. I guess what I can say here on the ADAs is the RaniPill, we believe, has the potential to be better because it is an oral formulation because we can change the dose. So if we're similar in terms of the ADAs, we believe that we're better because of all of those other reasons. So our goal with this study was just to track and make sure we were in line with historicals and with the control, and we achieved that result.

Okay. Great. And I know you touched on this in your prepared comments, but maybe to what extent you can walk us through the next test with Celltrion, what's the status of the interactions? And what else do they need to -- in order to move forward?

Yes. So there's not much I can say on this point except that we -- as has been publicly stated before, we have -- Celltrion has a right of first negotiation that triggers at the completion of the Phase I. We have completed this Phase I study, so that option period or the notification of it has commenced. And I'll save further comments on that for a future date.

Great. Great. I'll jump back in the queue. Congrats again.

Thanks. Thanks so much.

There are no further questions at this time. I'd like to turn the call back over to Talat for any closing remarks.

Thank you, everybody, for the time, and have a great day. We're really, really excited to be able to share these results with you and appreciate the time.

Thank you for your participation. This does conclude the program, and you may now disconnect. Everyone, have a great day.