Stoke Therapeutics, Inc. ($STOK)

All right. So I think we're ready to get started. Great. All right. Well, it is my pleasure to introduce Ian Smith, CEO; and Jason Hoitt, Chief Patient Officer of Stoke Therapeutics. My name is Kevin Strang, I'm one of the biotech analysts here at Goldman Sachs. Welcome.

Thank you, Kevin.

And -- I guess we'll just start getting right into a question for you, Ian. What were your priorities when you took on the CEO role at Stoke? And can you sort of provide a mark-to-market on your progress against those priorities and what you're focusing on from here?

Yes. So First of all, thank you for everybody joining us on the webcast and those that are in the room with us today. Just as stepping back, I -- I've been on the board of Stoke Therapeutics for 3 years now. And while I was on the Board -- an adviser to the company. And about 15, 18 months ago now -- 15 months ago, the Board asked me to transition at that time, and I was the interim CEO for 6 or 7 months, and I took the [indiscernible] position in October year. That's the background. How do I think about goals and achievements with the company? Well, first of all, it started with -- I want to help the company become the greatest advocate it could be for Dravet was as a disease, the devastation of Dravet. And once you understand that and understand what our medicine is doing for Dravet -- you actually start to become a very strong advocate for your medicine as well. That is kind of the medical, so to speak, for the company today. But what that translates into is understanding the audiences that need to understand them. So the physicians -- the physicians that treat Dravet or seizures today with medicines that only treat the seizure. Our medicine treats beyond the seizures based on all the data we've seen so far, we treat beyond the seizures in Dravet. And so educate the health care environment what our medicine can do for those children. Also to then understand how to progress the medicine to get it to these children that deserve the medicine, the families that deserve the medicine and build a company. Frankly, I worked with Vertex Pharmaceuticals for 20 years and saw medicine for statistic fibrosis over 20 years, come from the bench all the way to changing -- children with change in their lives. And you have to build a whole means working -- building a development organization to run the studies, having a regulatory group that has the right and appropriate interactions with the FDA, including breakthrough designation -- has accelerated pathways through to these patients. Building a medical affairs group that educates the market -- building a more of a business function in terms of manufacturing commercial. And frankly, understanding Wall Street as well in terms of educating the investment community to the opportunity that Stoke is creating in terms of an investment. I think all those areas needed acceleration and investment of time and people and then you ask me, Kevin, about mark-to-market. Really happy with how the company has progressed over the last 15 months. It really has accelerated the awareness in terms of the efficacy of the medicine. And the other and that means also the advocacy of the disease. And I'm very happy. I wish from a stoke price, I wish our stock price was a little higher, but who doesn't. But the company is building itself out. We've made great progress in the Phase III, which sure we're going to talk about. And there's a greater understanding of the medicine and the opportunity today. I'm very happy with it.

Great. That's a great place to start. You mentioned the disease itself, Dravet. At a very high level. What is that unmet need that you see today? You mentioned ASMs versus disease modification? How do you view that need and then we can get into -- ability to meet that?

Yes. So just -- consistent with what I said about being advocate for the disease first, just a little quick what is Dravet syndrome. And genetically Dravet syndrome is a depletion of SCN1A and therefore, you don't express NAV1.1 in the brain. What our medicine does or even -- and it boosts really a lot of the gene SCN1A that is functional and to express Nav1.1. What we've seen, what that results in is that it not only reduces seizures in Dravet because you go to the root cause of the disease, but it also provides cognition and behavioral benefits to these kids. In Dravet, they [indiscernible] 24 months old. Unfortunately, when they get to about that [indiscernible] so even when they're 20 years old or typically or neurodevelopment wise, they're still 2 years old. What our medicine does by giving back that expression of Nav1.1 is it provides a gain of function while you're on the medicine because you're expressing Nav1.1, and there's still neuroplasticity there. So whether you come on to the medicine as a 2-year-old, 5-year-old, 10-year-old, 12-year-old what we're seeing is there is a gain of cognition and behavior as measured in our studies. And so that is not provided anywhere for these Dravet children. There are very good anti-seizure medicines that are antiseizure medicines and reduced seizures. But seizures is still one of the, unfortunately, uncontrollable symptoms of Dravet. And all of our data, which shows 75% reduction in seizures, [indiscernible] of behavior is on top of standard of anticarry,anti-seizure medicines. We're driving that benefit even on the medicines that are available today. And that's because we go to the root cause of the disease of expressed in Nav1.1.

Got it. And that's -- so that's from your Phase I/II as well as your recently shared for your open-label extension data. Do you just want to highlight, especially with the 4-year data, what that means, and that's very recent data that you shared, so maybe just...

So we're in a unique position where the company has been in development [indiscernible] now 6 years, yet it is a truly breakthrough genetic medicine. And typically, with medicines like that, -- history so you move quicker in the clinic. But we've been in the clinic now for 6 years. And by the time that we file an NDA we will have been in the clinic for 7 years. What that has allowed us to do though is that our first patient that came in the Phase I/II study, 6 years ago or 5 years ago, they went through the Phase I/II dose-escalating study, but then rolled over into an OLE. That OLE, we now have captured [indiscernible] rare position where we -- that gives back function, and we're able to measure how much function is given by giving back over a 4-year period now, while also seeing the durability of seizure reduction over a 4-year period. And all that data, what it shows is we're seeing seizure reductions of 75 -- approximately 75% on top of the standard of care medicines that is durable out to 4 years now. And in terms of the cognition behavior, we've even run a statistical analysis that shows for each of the key domains of which is how you measure cognition behavioral improvements. All the 5 key domains year 1, 2, 3 and 4 was statistically significant in terms of improvements each year in cognition and behavior of 5 key -- domains.

Great. So moving on from that data to your currently running Phase III EMPEROR study. I believe you're guiding to completing the randomization of that study this month that would enable a readout middle of next year. Can you talk about how that study was designed to capture both the seizure benefit and then the narrow developmental outcomes, the Vineland-3 secondary endpoints?

So it is a 52-week study anticipated to be 150 to 160 patients. We anticipate completing enrollment this month, month of June. The primary end point is week 28, measuring seizure reduction. Secondary endpoints are Vineland-3, which is a measurement tool of cognition behavior, and that's run at week 52. So that's the design of the study. Patients go through the study and ultimately can roll over to an OLE study once they -- if they're in shame, they continue on the study have the option. As far as the study and the progression of the study, I can't give an update today on webcast but a month ago, we had recruited or enrolled 130 patients -- at 150 or 160. Of those 130 in approximately 90 were through the first 2 doses of 70 milligrams, and we had 0 dropouts, which is quite remarkable, that might be driven by the intent to get to an OLE but it also shows that the drug has been well tolerated in the base.

Great. So you mentioned the sand control arm. I guess how do you sort of approach -- how do you approach powering for that sham control arm? And you've done some natural history work as well, and you've also looked at natural history work? Talk to us in terms of that data and what you expect or what you expected when you design the trial on that 52-week endpoint. And I believe you presented last year some 18-month data as well. And so -- I guess if you could go over that.

Yes, it's a good question. This may be something that is a little difference of our Phase III program is we've powered the study based on the secondary end points, not the primary. The primary endpoint of seizure reduction, the seizure reduction is so demonstrative as what we've seen in all our data that we actually moved to the secondary endpoints and powered the study of the secondary endpoints. The powering in the study of the secondary endpoints is powered to a p-value of 0.01 with a confidence level of 90%. So it's conservatively powered and that brought us to 150 patients. We anticipated that there could be a 15% drop out, and we anticipated 150 patients to come to the study. So far, we don't have a dropout and I anticipate that the study could be as high as 160 patients. So we're very well powered. Now the data that led that led to that powering calculation was data being provided to the investment community under the medical conference in August of last year. And that showed that when you take a dosing schema or regimen, complete dosing regimen that's similar to the Phase III dosing of 230 milligrams over a 12-month period, we actually showed violent improvements of around 8 to 12 points, I believe, I think, or 8 to 11 points. The study is empowered to show 2 points improvement. So we're very well powered. We're in good shape. We've also provided a statistical analysis of that regimen rather than just showing the absolute balance scores. And we compared that to a natural history study, and we showed that we hit statistical significance at certain time points, and that was with an n of...

Great. And for how these secondary endpoints are being looked at in the U.S. versus Europe, can you just remind investors what those differences are? And whether they should think of any hierarchy for the subdomains? And even in the patient community or the physician community, are there certain subdomains that are more important than others?

Yes. So the subdomains that we're looking at for the NDA versus the European filing are the same subdomains. It's the same study in terms of the endpoints. To your question in terms of are there higher priority endpoints. If you talk to families and caregivers and physicians, you will find that there is kind of a priority, and they tend to focus on receptive and expressive communication. And then the one difference between the two filing strategies is in the U.S., it is a hierarchical assessment of the secondary endpoints, whereas in Europe, it's a composite but the trial design is very similar. There is a slight difference in 4 European countries where we're doing a lumbar puncture cohort -- sorry, a needle break cohort in terms of whereas the U.S., U.K. and Japan is lumbar puncture.

Got it. And as you move past the data and towards regulatory outlook for zorevunersen. What does it need to be -- what does it need to achieve to be viewed as a disease-modifying therapy and by regulators, physicians, payers, et cetera?

Yes. I would to jump all the way to -- I think it's already being recognized as a disease-modifying therapy because of the totality of the data. When you look at the 4-year OLE data and this durable reduction of seizures on top of standard care medicines, 75% reduction of seizures. And then you'll see these cognition and behavioral benefits in year 1, year 2, year 3, year 4 and that each year, they're statistically significant, that totality of data is already being recognized in the medical community and the payer community as a disease-modifying medicine. I think you're asking more about what's the regulatory environment and how they look at it. Again, I think very similar, whereas you've got to hit a primary endpoint to get the medicine approved. So we're very confident with that. But the second area is we're very confident there as well. But I don't think that you have to go and have 5 out of 5 secondary end points at each 1 because you've also got the OLE data, which would be in the label. The label has a part of the label where you've got to show your data from other clinical studies if it helps a physician understand the benefits and risks of the medicines actually in the FDA guidance in this call Section 14, but your clinical studies are required to be in there. And this is a chronic medicine. So when you have 5-year data, then you should put that in the medicine to help people understand how the medicine is affecting these children.

Are there -- you mentioned Section 14, what good analogs for investors to look to?

Yes. I mean the best analog I could give you is probably SPINRAZA. SPINRAZA, and why is it the best because it's also an ASO, the SPINRAZA looked at the primary endpoint at 6 months. They actually missed the secondaries. But the OLE data was on the label because they followed these children. And if you're familiar with SMA, unfortunately, these children, they don't -- set up, roll over, they die at very non-gauges. But Biogen like ourselves actually continued these patients into an OLE study and measured them and it helped to understand what the medicine did chronically. And these children lived longer and also had greater movement of function. And all that data went on the label because it helped people understand how the medicine affected these babies in SMA. We see it exactly the same in terms of being an analog that you're asking for. There are others as well. Jason has been involved with some of the...

Coincidentally, Sky Claris and Calsodia also from Biogen are good examples of observed data being added to the Section 14 of their labels.

Great. And I guess on the topic of analogs and I have a feeling it could be similar for this question as well. But how are you thinking about pricing?

Yes. So I think -- I mean I'm glad you asked the question, Kevin, because I think historically, there had been a misconception that because we're launching in Dravet and the only approved medicine so far in Dravet have treated just some of the symptoms, namely the seizures of Dravet that we would kind of be pigeon holder ballpark to that price range. But the reality is, is that what we're doing is addressing the underlying genetic cause of the disease. What we're doing is affecting the syndrome itself by doing so. And therefore, I think more appropriate analogs are genetically targeted disease-modifying medicines for rare disease. So the analogs we've been talking about most recently are obviously SPINRAZA, as you mentioned, the exon skippers from Sarepta, I think are also appropriate analogs, -- medicines like that, that are changing the paradigm in addition to addressing the underlying genetic cause.

Got it. And then for filing, you've mentioned rolling submission. Is the plan as soon as first quarter of next year, potentially allowing for a launch maybe early '28, around that time frame. Any gating factors to getting that initial submission started? And then what are the advantages that you have with breakthrough and using that rolling submission as the Phase III data comes in?

We'll start with the advantage of breakthrough designation allows us -- affords us the rolling submission. We anticipate starting the rolling submission in Q1 2027. The first section of that rolling submission will be CMC. Jason can update you with where we are there, but we're right on schedule, no problems and inspection and quality. Then the rolling submission would take us through to the last clinical submission that would be after the week-52 clinical data that would be in the middle of next year. At that point, when you complete your rolling submission, you get a PDUFA date that would be 8 months after the last submission that would put you in Q1 of 2027, the launch of PDUFA day in -- Q1 2027. However, if you look at the kind of the history of rolling submissions, breakthrough designation, approval generally comes anywhere between 4 and 6 months after last submission, which could potentially put us into Q4 2027. We're right on track in terms of what we're preparing for in terms of CMC, preclinical. Obviously, we're ongoing with the clinical data in the Phase III study.

Got it. So potential approval launch later next year, early '28.

Right.

Moving to the commercial opportunity. I feel like -- you've recently talked about your estimation of the patients available at launch around 6,000. Can you talk about what goes into that number, your prevalence, et cetera?

Yes. So I think the number 6,000 comes from two different ways of looking at it, right? And so you can look at it from an Epi perspective where going back a couple of years ago, before we initiated the EMPEROR study, we wanted to understand overall prevalence in the geographies where we were running the study. And so we initially looked at the core 7 geographies around the world, U.S., EU Ford, U.K. and Japan. And we took 85 years of live birth rates and scaled incidents to prevalence, applying Dravet-specific mortality, which largely is due to -- expected death and epilepsy. And that ultimately got us to a total population for the U.S. of 16,000 patients approximately. When you break that down by specific ages, about 4,000 of those 15 are purely pediatric patients under 18. But in Dravet syndrome, there's this dynamic of patients predominantly being cared for by pediatric neurologists, pediatric epileptologists that are initially the ones that diagnose the patient and care for them throughout their life up until they need to transition to adult care. And as you can imagine, patients, families, they develop a strong bond with the clinician that's been carrying for them over time, and there's a reluctance to transition to adult care. So oftentimes, the pediatric providers are caring for these patients into their mid-20s. And so the patients that are cared for by that group of specialists that are the most familiar and the most up-to-date with what's going on in Dravet are particularly relevant. And so 6,000 is the number of patients from an epi perspective that are 25 and younger in the U.S. Now pivoting to patients that are already identified today with an ICD-10 code for Dravet from claims data, there are also coincidentally 6,000 identified patients in the most robust claims database in the U.S. today. That's across all ages, but coincidentally, it also happens to be 6,000. We've brought several pieces of claims data in-house so that we can mine and analyze the data. And we've applied some machine learning principles to the already diagnosed patients looking at other CPT codes, treatment codes that are consistent with the Dravet diagnosis and then apply that algorithm to the total claims universe. And in doing so, we feel really confident that we know where about 70% to 80% of the 25 and younger patients are being cared for today. And as we launched the disease awareness campaign last year, for example, we have the ability now because there are linked NPI numbers for clinicians in there to hyper-target specific messaging to specific segments of clinicians based on the behavior that we're seeing from them from a diagnostic and a treatment perspective in an effort to change the behaviors that we would like to change and educate on the areas where they specifically need education.

Got it. So it seems pretty concentrated. Is there anything in terms of launch execution that you're planning for field force design, specific barriers you're looking for -- based on your work?

Yes. So obviously, this is contributing to how we think about field force design. And to your point, Kevin, this is a highly concentrated market, right? In this market, 50% of patients based on claims data are in 8 states. There are 1,200 clinicians that are caring for about 70% of the total Dravet opportunity. And then if you also look at the claims based on center sites or practices that are caring for patients, it's also 124 sites represent 70% of the opportunity. That could be group practices, hospitals, et cetera. So with a concentrated opportunity like that, we're looking at a very lean commercial infrastructure that will allow us to completely maximize this opportunity. You're talking 20 to 25 salespeople total Matrix field organization, but a commercial team that's well less than 100 people to maximize the U.S. opportunity.

And what does the time line look for that?

SP-30 So our commercial leadership -- so our medical affairs team is nearly fully built at this point. Obviously, the medical affairs team needs to be out and engaging with clinicians and they have been for the last couple of years. We have an amazing team of regional medical directors that are engaging with KOLs today. From a commercial perspective, the leadership team is in place, the entire commercial leadership team. All folks that have done this before, gone from a clinical stage company to a commercial stage company launched the first medicine in rare disease, and the majority of us have done this together before. So it's a strong foundation to start from. The vast majority of our hiring for, in particular, field-based personnel will start after Phase III data. We'll be gating some of our spend and some of our hiring to that, but leadership will be in place before then. And obviously, all of the work to prepare for the onboarding of those teams will be done before them as well.

Got it. And how are you thinking about -- we talked about different age segments. There's 18 -- like the 18 to 25 segment that's often treated by pediatric specialists still, there's the above 25 segments. How are you sort of approaching that? And do you need additional studies for the adult population when it comes to payer access and things like that?

Yes. So let me take -- maybe I'll take the first part of that first. And yes, so as you can imagine, just based on how genetic testing has evolved over the last couple of decades, the claims universe that exists today is disproportionately -- is disproportionately representative of the younger cohorts of patients, the 25 and younger. So there's more work to be done from a diagnostic perspective to identify those additional 10,000 patients that are largely adult patients. And so the focus of our screening efforts will be on that adult segment on the adult providers. while we also want to move diagnosis as early as possible for patients. But to your point, payers may limit reimbursement to trial inclusion criteria. And so -- we anticipate having data for patients that have aged into adulthood from our Phase I/II and OLE studies that we will specifically look at. But in addition to that, later this year, we're going to be starting a small adult study looking primarily at safety. But we're also going to look at seizures. We're going to look at neurocognition, and we're going to look at some endpoints that are specific to adults.

Great. And I wanted to talk about durability of therapy and sort of how you think about that. I know you obviously have long-term data at this point. In addition to that, what other assumptions are going into, how you view the persistence of therapy in the real world?

Yes. I mean -- we've now got 4 years of OLE data and the retention in the OLE study has been remarkable. The fact that we're also now well into the Phase III, and we've seen zero dropouts to date. I think the family seeing the benefit is the greatest motivator to stay on treatment. But to your point, we're already starting to build our patient services offering. And so obviously, with a rare genetic disease, we'll have a team of in-house folks that are interacting with families, interacting with offices, helping with everything that we can compliantly help with to get a patient on treatment and ultimately help them stay on treatment.

Just -- the OLE, the patients that rolled over into the OLE, 90% are still in the OLE 4 years later, nothing in OLE. It's a remarkable retention.

Great. From a -- I wanted to move on to a competitive standpoint. Is there anything that you're looking at in the disease-modifying landscape? I know, obviously, that's sort of how you think about your therapy and the disease modifying category versus an ASM. So when you look at that disease modifying landscape, is there anything? And then in terms of gene therapies, could those potentially be -- are those -- what you look at as complementary, competitive? How do you see that when you look at other rare diseases?

We don't see anything that the same as what we've got. We don't see somebody that's maybe trying to make data a -- And frankly, we don't say it that we've got a very strong IP portfolio. We're also of 5 years' worth of data. In terms of gene therapy, we do see some interesting approaches as a company out there that's doing gene therapy. And we look at that as somewhat validating and putting the SCN1A gene back in. And so that's an interesting approach. It's very early trying to figure out their dosing and they put out some data recently. It's interesting, I think. But I kind of look at zorevunersen and SPINRAZA. And if you look at the history of an ASO and gene therapy, gene therapy was interesting, but most patients roll on to SPINRAZA because of the durability at the point you would just make as a cap, the durability and the consistent response because you're continuously dosing. I think there's a lot of questions that remain about gene therapy in terms of its true onetime dosing and durability of benefit as well as just kind of the questions on safety -- the administration is kind of more -- a hole in the skull and get into the brain. AAV therapy still. And so it comes with us come with some safety -- as well. So we'll see how the landscape evolves. But there's nothing right now that we look at and say we're concerned to that.

Makes sense. And I wanted to ask briefly on your partnership with Biogen since we haven't really spoken about that yet. How has that partnership evolved over time? Obviously, there's a lot of overlap with the [indiscernible] space in the rare disease space. What's been the most [indiscernible]

Well, I'll go back to before the partnership existed and say, I was on the company [indiscernible] with its business development opportunity. The #1 question was, do we have the global capabilities to approve, get this medicine approved and launched into patient populations in the single-payer markets. And the answer 2 years ago was no. So we started a process competitive process. Even when we started the competitive process, so would like to have at Biogen as a partner because of SPINRAZA, because of its manufacturing capability, because of its global reach and its capability and SPINRAZA and SMA. We closed with Biogen, and -- we closed with Biogen, I believe it was February 2025, so just over a year ago. And the relationship with Biogen has been excellent. It's been everything we hoped it might be in terms of how that's helping us outside of the North American territories, and they bring a lot of capability to the table. We're running the studies. We're responsible for design, the progression of the studies, and we keep Biogen updated, but we have a whole governance structure in terms of joint steering committee, joint development committee, a joint commercial committees, joint manufacturing committed. And there is daily conversation and exchanging information between the two companies, but it's working really nicely.

Great. And I see you were essentially at a time. I wanted to briefly ask about your program in ADLA, STK-002. But should we be looking for in that program on the horizon? And then finally, just in terms of your cash position, where are you at today? And what is that -- what sort of milestones does that get you to?

Yes. So quickly, ADLA is a progressive genetic progressive loss of eyesight. We are in a Phase I/II dose single escalating study. We're in our first cohort of dosing. We anticipate 4 cohorts with cohort 3 and 4, potentially giving you an efficacy readout towards the end of this year or early 2027. And so we're pretty excited about that. We think it's -- we think -- is the right target to increase mitocontal function. And then to your second question on cash, we've got a -- we're very well capitalized at over $400 million of cash as of the end of Q1, and that cash supports us all the way through to 2028. But we're also supported by Biogen paying 30% of the development costs for zorevunersen. So we're in very good shape.

Great. Well, thank you, Ian, Jason and the team at Stoke. Appreciate it.

Yes. Thank you. Thank you for listening.