uniQure N.V. (QURE) Earnings Call Transcript & Summary

Great. Hello, everybody, and thank you for dialing in. My name is Luca Issi. I'm a senior biotech analyst here at RBC Capital Market. And today is a great privilege to have Matt Kapusta, CEO of UniQure, for a fireside chat. Matt, thanks so much for joining us.

And maybe let's start with hemophilia B here. Before we go into the specifics, we'd love to pick your brain here at high level on the programs and maybe some of the recent progress that you have made, and then we'll dive into specifics. And thanks again for joining, Matt.

No, really appreciate the invitation, Luca. Thanks for having us. Yes. So I think the most recent news is that we closed our landmark collaboration with CSL, who's going to be our global commercial partner for EtranaDez. So we're really excited about that, and we're now working very closely with them. We, of course, have a late-stage program for EtranaDez that's currently in a Phase III registrational pivotal study. We did release 26-week data at the end of last year that showed a strong Factor IX activity and some preliminary data on bleeding that showed a fairly profound impact on bleeding compared to the patient's observational lead-in, which serves as the baseline. So we've got 54 patients in the study. We also showed, I think, for the first time, in one of the largest sets of data, that AAV5 gene therapy has the potential to work in nearly all patients, if not all patients. So we're very excited about that. We think this is a highly differentiated gene therapy. We're very busy in preparing for a BLA submission. And we do expect to have a top line 52-week data from all patients in the study before the end of this quarter. So in terms of expectations there, really, the promise of gene therapy is a durable treatment. So we would expect patients that likely achieve steady state at 26 weeks to continue to enjoy their increases in Factor IX activity and reductions in bleeding frequency. And so we're looking forward to discussing that data, presenting that data. We'll likely do so also at an academic conference sometime over the summer. We're looking at publication of the data as well.

Got it. Got it. Very helpful, Matt. And then maybe you already mentioned and alluded to it, but again, given that the data is coming down the pipe soon by the end of the quarter, if I recall it correctly, I think at ASH last year, we saw this 83% reduction in bleeds. And I think -- and 98% patients that should discontinue Factor IX prophy, what's the [ bogey ] for success at 12 months?

Yes. As I mentioned, I think it's really continuing to show the same kind of directional effect. We do have more than 5 years of follow-up from our Phase I/II study and more than 2 years of follow-up from our Phase IIb study. So we do have an understanding of the kinetics of Factor IX and the long-lasting durable impact that it has on clinical outcomes. The 83% reduction, as you mentioned, is total bleeds. So that includes things like uncharacterized bleeds or even traumatic bleeds. We did show a 90% reduction of spontaneous bleeds that require treatment, which is really the reason why these patients are on prophylaxis. So we'll kind of dissect out a bunch of those statistics. And that will be included in our presentation of the data when we do that later this month or later this quarter as well as when we present the data at an academic conference.

Got it. Got it. Very helpful. And then maybe something you have not mentioned, but would love to pick your brain. Obviously, the program was on clinical hold for a short period of time. Good news, the clinical hold has been lifted. How should we think about the risk-benefit profile going forward? And maybe what are the implications for the label -- potential label down the line? Do you expect maybe patients with certain liver conditions to be excluded from the label? Any thoughts there?

Yes. We don't think there's any need for exclusion because I think we -- and probably as strongly as -- this is my personal view, as strongly as we could have hoped. I think we've largely answered the question about causality. I think it's one of those things proving a negative where it's very difficult to 100% say there's no causality. But the -- really, the overwhelming data, and we performed a tremendous amount of analyses, suggest that there's no relationship between the treatment and this patient's unfortunate development of HCC. And I might be an outlier here, I don't know, but I actually think that this very detailed investigation that demonstrated a high unlikely put of causality actually would comfort or provide confidence with patients that might have a concern about it, that this is something that we've actually examined in detail with our specific product, and we've determined that whether it's this patient or the other patients, that there's extremely low rate of integration and the propensity for that to trigger immunogenesis or oncogenesis is very, very low. So I would hope that this would provide comfort. And there's always the potential with high-risk patients to monitor them more closely after therapy. And we think that's a decision that should be in the hands of the patient and their physician.

Got you. Got you. No, that's very helpful. And I think you mentioned earlier, obviously, the BLA filing hopefully soon. If I recall it correctly, you previously guided a BLA filing in 2021. Wondering if those time line has changed or they're still intact. And maybe bigger picture, what has been the nature of the dialogue with the regulators so far? What are currently gating items to get that BLA over the finish line? Any thoughts there?

Yes. So we are still targeting a submission to the BLA this year. We were obviously busy in the first quarter ensuring that we could address the clinical hold, which we have successfully done. And so what's remaining is we're in the process of locking the database. We have to compile the data from the clinical study. We have to complete the CMC validation work that we've been in progress with doing. And we need to have our pre-BLA and pre-MAA meeting with the agencies. And of course, now that the CSL transaction has been done, we will be coordinating with CSL in those regards and working very closely with them to ensure that we can try to meet those time lines.

Got it. Got it. That's very helpful. And I see the audience here are eager to pivot to Huntington, but maybe a few more questions on hemophilia B before we pivot to Huntington. Maybe high level, how do you see the competitive landscape at this point? Again, I think you are in a privileged position to potentially be first to market, which is terrific. You also have Pfizer in the mix. I think they're using a much lower dose, I think 40x lower dose, which they would argue has better gross margins but potential better safety. That's what they would argue. Also, you have Freeline in the mix that obviously are a very different approach where they're trying to have Factor IX levels potentially up to the normal range. What's your take on either approach? Why you think that UniQure will be the ultimate winner here?

Yes. I think -- we think we have what we often refer to as kind of a goldilocks profile. There is a therapeutic window for hemophilia. There is a rate or threshold above which there are functionally curative benefits for patients. And then there's a level of Factor IX beyond which that is above normal and could potentially pose a risk for thrombogenesis. And I think what we've shown is that in the -- really, the overwhelming majority of patients, we're able to get them within that window. So we're able to get them above a level that they can get off of prophylaxis. But even at the standard deviation above the mean, we're not pushing them at levels that would be super physiological concerns for safety. We also have shown long-term durability. We've shown, actually, despite the dose, a lower propensity for immune responses. And we've demonstrated that we can treat all or nearly all patients. So we think that it's a really strong product profile. We think our margins, given that we utilize in insect cell, baculoviral platform without expensive plasmids and whatnot, really, we can enjoy margins for ourselves as well as for our commercial partner.

Got you. Got you. Very helpful. And maybe -- you just mentioned it. I want to make sure we can expand a little bit on it. You mentioned you're probably -- or are the only company that can treat all patients, if not most of them. I think your data actually showed that the efficacy was agnostic to neutralize the antibody baseline at least up to level up to 678 or some numbers along those lines, which is 95% of the market, which is, again, the differentiating feature versus some of your competitors. How should we think about the 5%? How should we think about the 5% that are above the threshold? Do you expect to have the need of a companion diagnostic at some point when this is going to get approved? What are your thoughts there?

Yes. I mean we're preparing, and we have a validated test for preexisting neutralizing antibodies. So it may not matter, but I think we don't believe that we do require it. It's -- our view is that it's at least 95% because there's only 1 patient above a titer of 678 as expected. We do know a lot about this general population. And so it very -- could very well be 100% or closer to 98% or 99%. We have to remember that it could be aspirin, right? I mean there's probably no drug that works all the time in every circumstance for every patient. And in some respects, when you start getting into the very small fractions of an already orphan market, really, the only way to learn this is post approval. So these patients will all be monitored. And if you do learn that there is a natural cutoff, that is something that I think would be very useful. And so I think our argument would be that we do not require testing, but we would offer it to physicians and patients that want to understand this information.

Got you. Got you. That's actually helpful. And maybe this is old news, but I'll ask this question anyways. Obviously, we have seen for hemophilia A, Biomarin getting in trouble [indiscernible]. The FDA moved the goalpost there for them. Obviously, hemophilia A and hemophilia B, very different diseases. What gives you confidence for the same decline that we have seen in hemophilia A for Factor VIII will not happen for hemophilia B for Factor IX? Any thoughts there?

Yes. I think -- I mean what gives me confidence is that we've really never seen it in a myriad of clinical studies across hemophilia B, whether it's our own patients or the patients from other sponsors. They are -- they're both hemophilia, but they deal with completely different genes that express in very different locations within the body and have different kinds of folding and posttranslational modifications. So all we know is, look, we've treated 67 patients, and we have now more than 5 years of follow-up, and we've seen very durable treatment. The oldest study has now almost a decade of follow-up, and they've seen very durable outcomes. And the agency is aware of the differences between A and B. All we can say is that in our discussions with the agencies, there has been no indication that we would require more than 52 weeks of follow-up. But certainly, we'll know more after we have our pre-BLA meeting with the FDA.

Got it. Got it. That's really helpful. And in the last few minutes here, let's pivot to Huntington. Maybe, obviously, the field have seen this data from Ionis, obviously, very difficult data to swallow for the community for -- really for patients and caregivers given the devastating nature of this disease. Maybe big picture, what was your reaction to that news? It kind of struck me, too, that the high dose seems to have somewhat of a detrimental impact versus placebo. Placebo outperformed the most metrics. And I think that you also have this increase in ventricle volume that you see for the high dose. What was your reaction to that news and how you think about implication for your program?

Yes. I mean, obviously, we were very disappointed for the patient community that is in desperate need for treatments. But in all honestly, we weren't terribly surprised. We've known now for 2 years that there are -- there is something unusual going on with respect to increases or prolonged increases in neurofilament light, which is a biomarker for neural degeneration, as well as increases in ventricular dilation. We do believe that there is pretty meaningful amount of evidence that suggests that there are other factors here beyond HTT that are at play. As an example, there are case reports of hydrocephalus in patients that have received ZOLGENSMA, which is also an antisense oligo for treatment of spinal muscular atrophy. There also have been cases of hydrocephalus in the Roche pivotal study, the increases in ventricle dilation or not in conjunction with enhanced atrophy of the caudate, which suggests actually that there might be penetration into the brain, but really not much deeper than the ventricles. And so there are a number of things going on here. And I think if you squitch your eyes and you look even at the safety of the procedure, where they're administering intrathecally a placebo, there's -- the procedure itself, which is a chronic administration, had north of 20% of patients that had severe or significant adverse events. And the adverse event profile was pretty consistent with even patients that receive treatment. When you look at their Phase I/II study, even at the 10-milligram dose, you saw patients that have significantly larger increases in ventricle sizes at a dose where you're -- even the company is expecting somewhere between 10% and 30% suppression of Huntington. So I don't think -- our perspective is that there's something else going on here than just the mechanism of action. And of course, we'll learn more. I mean we've treated now 10 patients in our study. We'll have the earliest data on the first 4 patients will come out. And I think if we can establish a safety profile, I think that will further demonstrate that there's something going on beyond the mechanism of action.

Got it. Got it. That's helpful. Maybe playing devil's advocate, I think you mentioned the [indiscernible] administration. Obviously, you have a completely different approach. You're using an intracranial type of delivery versus all of this is intrathecal and there's antisense oligonucleotides gene therapy driving the expression of microRNA. So they have very different approach in terms of molecular biology. But what's your take on this wild-type-sparing hypothesis? I think the people that believe in the wild-type-sparing hypothesis maybe looked at the Roche data and say, "Hey, we see this -- those depend on the detrimental impact." And so that maybe validate the fact that if you're knocking down the wild type, you can have a detrimental impact on patients. What would be your response to that?

Yes. So let's talk about this a little bit. So firstly, there's no debate that the Huntington's protein plays a critical role in developing brains, okay? So that's very clear. What is very debatable is what is the role of Huntington's in brains that are already developed, right? So we know that there's intracellular trafficking that is done by Huntington's that has been shown in, in vitro studies. And we know that if you knock it out 100% in neonatal mice, right, that it's detrimental, right? And we've demonstrated that ourselves. However, when you look at more than 15 studies that have been done in animals, diseased animals, there's not a single study that shows that knockdown of wild-type protein up to 75% is detrimental. And remember, right, we are delivering our silencing construct to the areas that are disease -- of the brain that are diseased, and we are largely sparing healthy tissue in the brain and certainly the systemic areas of the body. So when you look at where we're targeting, which is somewhere between 25% and 75% suppression in those specific areas of the brain, you combine that with all the plethora of the data that shows that you can suppress wild-type protein up to 75% without toxicity, we think it's pretty compelling and strong evidence to suggest that this is a relatively safe approach as demonstrated by the data. And as I mentioned, if you kind of go back to the Roche study and you see even at the 10-milligram dose that there were significant increases in ventricle dilation at ranges where they're expecting 10% to 30% suppression of wild-type protein in the brain, it wouldn't seem to compute that it's specifically related to wild-type suppression. So look, as I say, we'll learn more as we produce our data. But we do think that when you -- for those that really look at this, and we've looked at this very, very closely, there really is a lot of evidence to show that it's beyond the HTT mechanism that might be causing some of the clinical outcomes that we're seeing in the Roche study.

Got it. Got it. That's very helpful, Matt. And maybe one of the -- we talked about [indiscernible] administrations. We talked about wild-type sparing. We talked about some of the differentiated feature reprogram here. Maybe the one that we have not talked about it is exon 1. You're obviously targeting exon 1 here. Why does that matter?

Yes. So exon 1 matters because even if you can silence the full-length Huntington sequence or the full-length protein, what we know is that there can be alternative splicing of the Huntington gene, whereby you can still get expression of a highly toxic short protein fragment at the first exon. And that short fragment comprises almost completely of polyglutamine. And so it aggregates like crazy, and is thought based on independent scientific research to be toxic. And so it is possible that even if you are suppressing mutant protein, even if mutant protein is contributing to the pathology, which we all believe it does, right, that you still might have lingering toxicity if you're not silencing this exon 1 short fragment. So we have designed our construct and have demonstrated in animal studies that we not only suppress the full-length mutant protein, but also do suppress this highly toxic short fragment. So that's why it could be potentially meaningful for patients.

Got you. Got you. That's very helpful. Maybe last question on Huntington here. Obviously, you mentioned the data is going to be toward the end of the year. It feels to me that The Street is hyper-focused on looking at mutant huntingtin in the CSF and the knockdown of mutant huntingtin in the CSF, given the antisense oligonucleotides experience. Why do you think that's not necessarily the right biomarker here to think about it? What are some of the other biomarkers that we should be focused on? Any thoughts there?

Yes. I mean there's a number of reasons why we don't think it's the right biomarker. The first is, I mean, really, the Roche experience, right? I mean Roche was able to demonstrate meaningful reductions in mutant protein in the cerebrospinal fluid, but that has not led to success. Secondly, we're fairly confident, again, based on the Roche experience and our own discussion with the regulators that, that is not going to be, at least today, a biomarker that is registrational. And third, the reason why it's not because the understanding of the correlation between mutant protein and the CSF and what's going on in the brain, and of course, clinical outcomes is just -- there's just not really much known about that at all, I mean, you're not -- the goal is not to suppress while mutant protein in the CSF. The goal is to suppress it in the deeper structures of the brain, in the cortical regions of the brain that are implicated in the disease pathology. So -- and it's lastly not really all that relevant because we are administering our product into the deep structures of the brain, not directly into the regions of the brain that are surrounding the ventricles, right, which are really not also implicated in the disease. So we know that the mutant protein that is secreted into the cerebrospinal fluid comes from the ependymal layers outlining the ventricles, right? So it's not a biomarker that we think is going to be relevant for approval, and it's probably not a biomarker that's going to be relevant given our mode of administration. We think what's much more relevant is actually imaging what's going on in the brand, right? I mean we do know that the size of the caudate and the size of the putamen is a leading indicator of disease progression. And so we're going to be very closely monitoring striatal atrophy within these patients. We also know a lot about neurofilament light. And we know that in other neurocognitive disorders, that neurofilament light increases with disease progression. So we're going to be tracking that as well. And then, of course, we're going to be tracking functional parameters, in particular, the motor functions, which are controlled by those deeper structures where we demonstrate that we have asymmetrically greater suppression of mutant protein. And these are a bit more objective measures that tend to manifest earlier in the disease progression of Huntington's patients. And so these are all the things that we're going to be looking at. We think they're much more understood and correlated with disease progression than the mutant protein in the CSF.

Okay. Fantastic. Super helpful, Matt. Unfortunately, we are running out of time. Maybe last question in the last minute we have. I want to make sure I keep you on track with the rest of your day. Obviously, you have a R&D Day upcoming. What should we be focused on?

The purpose of the R&D Day, now that we've closed our CSL transaction, this is a really exciting time for UniQure going forward. On a pro forma basis, we have around $700 million of cash and the potential for another $1.3 billion of milestones and royalties on net sales. So the question is, how are we going to drive value going forward? So we look forward to outlining that strategy and disclosing some newer programs that we're focused on that we're really excited about. As well as some of the enabling technology platforms that we're developing that are going to be supporting our R&D efforts.

Matt, we really appreciate the time. This is a fantastic conversation. We look forward to continuing to dialogue in the future time. But again, thanks again for joining us at RBC today.

Yes. Thanks for having me, Luca. Have a good one.

You, too. Thanks so much. Yes. Bye-bye.

Bye-bye.