Vera Therapeutics, Inc. (VERA) Earnings Call Transcript & Summary

All right. Let's go ahead and get started. Welcome to the afternoon session of the Tuesday, 41st Annual JPMorgan Healthcare Conference. My name is Anupam Rama. I'm one of the senior biotech analysts here at JPMorgan. I'm joined by Malcolm Kuno and Priyanka Grover from the team. Our first presenting company of the afternoon is Vera and presenting on the behalf of the company, we have CEO, Marshall Fordyce. Marsh?

Thanks so much, Anupam. Good afternoon, and welcome, everyone. I'm Dr. Marshall Fordyce. I'm the Founder and CEO of Vera Therapeutics. Today, I'm really pleased to share a company update with a particular focus on the top line results from our ongoing multinational, randomized, placebo-controlled Phase IIb trial called ORIGIN that we announced last week. These data are positive, both statistically significant as well as clinically meaningful, and they compare very favorably with competition. Moreover, the results enable us to refine our design carefully with the information from the quality of the study and move rapidly into Phase III. Before we get started, I'll remind you that I'll be making forward-looking statements under the Safe Harbor Act. And as such, we present this disclaimer regarding at-risk statements. Overall, our vision is to change standard of care with an initial focus on autoimmune kidney disease. Our lead clinical stage asset is atacicept, a potentially disease-modifying agent with well-characterized clinical safety and a mechanism that targets B cells and plasma cells that are the source of this autoimmune disease. And we have a further pipeline in a drug potential, as evidenced by our first 2 indications. First, the Phase IIb program that I'll focus on today is in IgA nephropathy or IgAN, and we have clinical data in hand that show best-in-disease potential, which I'll spend time on today with our positive readout from just last week. We also have initiated a Phase III program in lupus nephritis, another autoimmune disease affecting the kidney. That was enabled by positive FDA feedback upon review of our significant clinical data from prior work on atacicept in systemic lupus and an integrated safety analysis of over 1,400 patients at the doses being explored. We have a second clinical stage asset called MAU868, an anti-BK virus monoclonal antibody, which is a potential first-in-class agent targeting high unmet medical need condition called BK virus-associated nephropathy, which is a cause of kidney graft loss. And we have encouraging proof-of-concept data that I won't focus on today, which shows a clear antiviral response for the first time in patients on standard of care in a placebo-controlled trial. We have a strong financial profile with $134 million in cash and sufficient to fund operations to 2Q of 2024. That cash runway estimates ongoing, funding all 3 programs, which we would expect to advance into Phase III for our projections by the end of this calendar year. We believe our current market cap does not reflect the value we've created and we're exploring a refined cash runway, focusing on our IgA nephropathy clinical program only, which is driving value today. We're funded to operate through several near-term drivers of value, particularly in IgAN. And here, we summarize the potential value creation events over the next 18 months. The next of which is highlighted in blue, which is our 36-week results from the ongoing Phase IIb IgAN trial in Q2. Because we've observed deepening trends in proteinuria after 24 weeks, we believe that 36-week results will be meaningful and enable a better comparison to competition as we continue to mature our data set and others continue to mature theirs. Additional data beyond the 36-week time point from the Phase IIb IgAN study will be shared in 2023 and 2024 which will inform -- will be informative regarding atacicept proteinuria reductions and effect on glomerular filtration rate or GFR over time for up to 2 years. There is emerging evidence in current clinical trials that targeting B cells, the source of pathogenic autoantibodies in IgAN could be disease-modifying and substantially improve kidney function over time for these young patients who are on average diagnosed at the age of 30 years old. Vera's lead molecule in IgAN is called atacicept. It's a fusion protein that's self-administered as an injection subcutaneously once per week. Atacicept targets the source of IgAN by inhibiting the 2 known circulating cytokines, BLyS also called BAFF and APRIL, which are both important for the survival and maturation of the B-cell lineage. In an earlier randomized control trial, atacicept substantially reduced the causative molecule of this disease called galactose-deficient IgA1 or Gd-IgA1. We've also shown in 2022 that atacicept reduces IgG autoantibodies to Gd-IgA1 and atacicept also reduces immune complexes that form and cause the downstream kidney injury. This is the only data set in the IgAN field targeting each of these hypotheses and showing randomized controlled trial evidence of impacting the source of the disease at 3 upstage hits. We designed the ORIGIN trial, which I'll present shortly, to demonstrate whether atacicept's known effect on the upstream causes of IgAN translate into improved kidney function as measured by a reduction in proteinuria and stability of estimated glomera filtration rate or GFR. The best evidence to demonstrate a clear treatment effect is to run a multinational, double-blind, placebo-controlled, randomized trial, so that any factors that might influence the primary endpoint called confounders are well distributed between treatment and the control arms. Last week, we reported positive results after 24 weeks of treatment. I'll highlight that our results include all randomized patients through 24 weeks of treatment, which is a first for the B-cell modulating class. We've only seen partial data sets and different study designs up until our data release last week. As a summary of the results, this clinical trial was positive, meeting the primary endpoint of statistically significant reduction in proteinuria between the combined 150 and 75-milligram doses versus placebo. Moreover, statistical significance was also achieved for the 150-milligram dose alone, showing a 33% reduction from baseline at 24 weeks. We observed a trend towards further reduction beyond 24 weeks in the subset of patients who have gone on to the week 36 time point with available data, which includes approximately 1/3 of patients enrolled. Patients on atacicept had stable renal function as measured by GFR over 24 weeks. And the 150-milligram dose showed a Gd-IgA1 reduction of 60% at 24 weeks. The safety profile for atacicept in these otherwise rather healthy patients was similar to placebo, giving us good confidence going forward into Phase III at the 150-milligram dose, which is what is planned in the near term. To focus on the study design, which is a major strength of this program. This was designed as a multinational, randomized, placebo-controlled trial powered to detect a 28% difference between the pooled 75- and 150-milligram doses versus placebo. You can see that patients were randomized to 1 and 4 arms. Placebo, atacicept 25, 75 and 150 milligrams, respectively. You'll notice the 25-milligram dose, the lowest dose, we enrolled half of the population, so a target of 15 enrolled and that was simply to have additional dose information as we understood the dose range in effect with these parameters in IgAN patients for the first time at this size. The primary endpoint was reduction in proteinuria at 24 weeks. We have a secondary endpoint at 36 weeks. So we have a blinded phase all the way through 36 weeks, also called 9 months. And then we'll have an open-label extension, where all patients will be offered a transfer to atacicept, 150 milligrams, and we'll follow those patients for a total of 96 weeks. So we will have ongoing data cuts beyond the 36-week endpoint. Inclusion criteria you would find quite similar across the field. These are adults who have biopsy-proven IgAN and are at high risk of disease progression. This is really the target for initial approval and the only population for which a drug is approved in this space. Patients are on stable and optimized RAAS inhibition, so one ACE inhibitor or an angiotensin receptor blocker, and they needed to have, despite that treatment, at least 0.75 grams of protein or more per day which is standard now for those who are at high risk of disease progression. We enrolled a GFR of over 30. A 30% reduction in proteinuria is known to be clinically meaningful in IgAN patients. A 30% reduction in a natural history study of IgAN patients collected by Kidney Health International as well as FDA and published is associated with an improvement in renal function in IgAN as measured by the slope of GFR. Reduction of 30% could delay end-stage renal disease by over 10 years. That's the evidence that led to the first drug approval in this disease called TARPEYO, which showed an 18% proteinuria reduction from baseline at week 24, the time point we're looking at today. And then a 34% reduction from baseline at week 36 with a calculated delta of less than 30%, I believe it was in the 27% range. Setting the precedent for accelerated approval in IgAN on the basis of proteinuria reduction and then full approval on the basis of following GFR over 1 and 2 years. The next PDUFA date is for Travere's sparsentan, which showed a 35% delta active controlled adjusted reduction in proteinuria at week 36. Just briefly, the ORIGIN study was a multinational trial and enrollment was not overrepresented in any single country. So this is a diverse global randomized controlled trial. For disposition of 232 subjects screened. There were 116 randomized and treated patients. Safety results include all patients through 24 weeks and beyond at the December time cut. And for this analysis of efficacy, it's important to note that we are reporting the intention to treat ITT population, which reflects data from all randomized patients regardless of protocol violations that may have had an impact on proteinuria and this is a better reflection of real-world use and is the most rigorous test of efficacy used by FDA and is essentially the same approach taken by the approved drug, TARPEYO in Phase II and provided the right initial presentation of the most rigorous tests. Discontinuations were similar between atacicept and placebo. On atacicept, one patient discontinued in order to have an elective surgery, another due to an adverse event of injection site reaction and on placebo, one patient discontinued in order to initiate a prohibitive medication for a concomitant disease. For baseline characteristics, overall, the study enrolled patients who are at high risk of disease progression, and were on a current optimized background regimen, allowing a clear assessment of atacicept's treatment effect on top of the current and emerging standard of care. The average age was 39. It was 59% male, 44% Asian race, an average GFR of 63 mLs per minute and an average UPCR of 1.6 grams per day. Patients were on optimized ACE or ARB, but in addition, if a subject was also on a stable SGLT2 inhibitor without change for at least 8 weeks, that patient was allowed to enroll and that comprised of about 14% of this study population at this analysis. The primary endpoint analysis was performed on all randomized patients and assessed not shown here, but the pooled 75, 150-milligram dose achieved stat sig versus placebo with a p-value of 0.037 and the all atacicept group versus placebo with a p-value of 0.026. Shown here is the statistical significance that was also achieved with the individual dose of 150 milligrams that we're carrying forward into Phase III with a 33% mean reduction in proteinuria versus baseline. You can see the calculated delta is 28%. Just to remind you, these are geometric means. So a simple arithmetic subtraction is not the appropriate way to assess the delta. So this is a calculated delta between active and placebo. And we also looked at patients who reached the 36-week time point roughly 1/3, and we saw trends towards deepening proteinuria beyond this 24-week time point. The exploratory endpoint analysis of GFR showed stability really in all atacicept arms, a positive 3 mL per minute increase at 24 weeks for active versus no decline for placebo. This is an early time point at which to assess separation between active and placebo because these patients take up to 2 years to have roughly a 20% decline in GFR if on placebo with patients characterized this way. We had robust reductions in Gd-IgA1 through week 24 of about 60% for the 150-milligram arm and dose-dependent reductions in serum IgG, IgA and IgM level. So importantly, IgA reduction of about 59%, which is comparable to the only other reported IgA and Gd-IgA1 reductions in the field, which is BION-1301. So similar reductions in IgA and Gd-IgA1 between our 150-milligram dose and what's been reported with a 600-milligram subcu dose from an open-label study for BION-1301. Importantly, dose-dependent -- from a safety perspective, these immunoglobulin reductions were well above the lower limit of normal. So no patient had a study drug discontinuation, interruption or a sustained IgG of less than 3 grams per liter through week 24, which is seen as the safety threshold at which you might pause a B-cell modulating therapy. So we did not see any pause or interruption. Safety results indicated that atacicept was well tolerated and generally balanced with placebo. Study drug-related adverse events were higher for atacicept versus placebo and the majority of those were injection site reactions. But as I've already mentioned, just one led to study drug discontinuation. That patient discontinued after 3 injections due to injection site reactions. The patient also had a positive hepatitis B DNA test that was normal without treatment at a retest and had normal liver function test throughout. So there's not a concern for hepatitis B, but there was a positive test. Serious treatment emergent adverse events were absorbed in 2% of patients in all atacicept arms and 9% of patients in the placebo arm. And the results demonstrate a safety profile in IgAN patients that's comparable to placebo and builds upon the prior integrated analysis of atacicept in randomized double-blind placebo-controlled trials in over 1,500 patients across all indications to date. We did look at infections as we were focused on B-cell function and all infections in the trial were mild or moderate. There were no severe infections and rates on atacicept were comparable to those on placebo. We did run this trial in the time of COVID. And it was interesting to see about 25% of patients got COVID-19 during the trial. And as we looked at those cases, only -- none were judged as severe and one led to a brief hospitalization that was followed by a quick recovery. For a safety summary, atacicept was well tolerated, no reported deaths, a low rate of serious adverse events overall. One patient discontinued for an injection site reaction. Infections were balanced. There were no serious events, adverse events on the 150-milligram group and no patient had a study drug discontinuation or interruption due to hypogammaglobulinemia or low IgG levels. In the last few minutes, I just want to point out these data in context. This is of critical importance for our description of these important and robust data to the Street. We're reporting for the first time, positive results from a multinational randomized placebo-controlled trial for a dual BLyS, APRIL inhibitor in IgAN patients and they compare very favorably to other available results. TARPEYO, which also conducted its analysis and randomized patients showed approximately 18% reduction from baseline at 24 weeks. As we look to the next program that we anticipate potential approval, we do not -- we have not yet seen 24-week numbers, so we can't compare. And then as we turn to the third program, Otsuka's sibeprenlimab. This is now in the same mechanism field as we are. It's a B-cell modulator, an anti-APRIL agent, and we have the benefit of an interim analysis that was presented in November looking at sibeprenlimab. That study was a global randomized controlled trial with slightly higher proportion of patients from Asia. They studied IV infusions once monthly and presented their data as combined dosing, so didn't break out the data in the presentation. And on the basis of that data, I have decided to go forward with a subcutaneous formulation of 400-milligram subcu, which we understand to be a one injection of 2 milliliters per dose. They have not reported 24-week data. Their week 36 report of a reduction in proteinuria showed pooled IV doses at 43%, and that was not the full data set, so they've enrolled 155 subjects and this is an interim analysis of 72 subjects with proteinuria data and further detail on that subset and how it's different from the total set is not yet described publicly. We have not seen numbers on its impact on IgA or Gd-IgA1 and we haven't seen placebo comparison for safety data. As we turn just to the B-cell modulating class, we think it's important to focus on our approach of dual APRIL, BLyS inhibition advancing into Phase III this year, along with 2 other programs, the anti-APRIL programs I've mentioned, both Otsuka's sibeprenlimab and Chinook's BION-1301. I think it's important to point out that Vera's data is really the first, we believe, that's been reported with SGLT inhibitor use -- SGLT2 inhibitor use in an RCT. And we haven't seen some of the baseline characteristics that would be helpful to compare between what we've reported in some of these programs. And finally, I think it's important to point out that anti-APRIL program, BION-1301, has shown a K-series. It's an open-label study of reporting up to 24 patients so far at the week 24 time point. And what we've seen is an impressive roughly 50% reduction in proteinuria at that time point. We see essentially the same IgA reduction between our program and their dose that they've explored for IgA and galactose-deficient IgA1, but we see it quite a disconnect in terms of the proteinuria reduction. And so I think it's important to focus in our view that, that really is driven by study design. When you run an open-label study with observed doses in the clinic, they did it on every other week basis, one has control of confounding factors and knows which patients are on your drug because there are no placebo patients. This is a very important difference in terms of study design that could lead to the disconnect in proteinuria reductions that we've seen in our global randomized controlled trial versus this open-label study. We believe that dual inhibition of APRIL and BLyS may confer important potency advantages which is evidenced in the dosing profile that all of us are now advancing into Phase III. Atacicept is the only B-cell agent at less than 200 milligrams and delivered as a single mL making subcutaneous injection, small volume and simple in our target commercial profile. We will soon be pointing out that week 36 data will be shared in Q2. And additionally, we'll have ongoing data readouts from the open-label extension further into '23 and into '24. We did have an FDA meeting in Q4 of 2022 discussing preliminary alignment around a Phase III study design to enable rapid study start. That's why we chose the primary endpoint of week 24 was to speed development. And the final trial design is, of course, pending final FDA concurrence. We have the ability to leverage our existing worldwide sites and importantly, we have a dose with a clear dose response along multiple metrics that met statistical significance in this study at an early time point. And with that, I know I went a little bit over time, Anupam, but thanks for the extra time. I thank you for your attention and provide a chance for questions now.

Thanks, Marshall. Just want to remind folks that there are 3 ways to ask a question. You can send a question through the digital portal, and I will get it here, you can e-mail me or you can go old school and raise your hand and ask a question. All are welcome. So we actually have a bunch of e-mail questions and portal questions. So maybe we can work through those. So the first one is, there seems to be a disconnect between what you're hearing from KOLs like on your conference call and how the Street reacted to the data. Do you believe that you've enrolled a sicker population than your competitors, put the SGLT2 inhibitor enrollment and those patients in there into context. And how can you basically message this to KOLs, so that they can be champions of the drug?

Yes. I think there's an opportunity as we continue to share analyses with KOLs. I think there's an important balance between what we shared publicly and what informs our Phase III program. Importantly, in drug development, we learned from Phase II to inform and improve probability success into Phase III. That disconnect between kind of market dislocation and what we felt was positively received by KOLs. I think it needs to be shown with additional analyses, what could account for this difference in proteinuria response that we have shown in a global randomized control trial versus the others of different design. And I think really, the field should be combining their thinking about why this might be the case. But I would continue to put forward that a global randomized controlled trial, where we gave prefilled syringes to people to take home and self-administer is a very good test of what we'll study in Phase III and beyond. And we think that's an important standard that will help us know what was going to happen in Phase III.

Another e-mail question here is, based on your understanding of the data today, what do you think BLyS is adding to the clinical benefit of atacicept.

Yes. I think it's hard to say. But maybe the best way to look at it is at 150 milligrams subcu once a week, our atacicept with dual APRIL, BLyS can achieve the same IgA reduction as 2 separate anti-APRIL monoclonal antibodies that require several hundred milligrams to get the same reliable PD effect. So I think that's the key. It's potency. It doesn't surprise us. We've seen this both in understanding the biology of APRIL and BLyS. If you take a mouse model and inhibit APRIL and BLyS, you get more potency than inhibiting APRIL alone or BLyS alone. So to us, it's becoming self-evident that the dosing going into Phase III represents that difference in potency.

Another question that we've gotten in the portal here is, do you think KOLs distinguish between a 30% reduction in proteinuria or a 37% reduction in proteinuria? And what is that -- you've crossed that threshold of 30% that you talked about in your presentation. What is the delta where a change in proteinuria all a sudden becomes clinically meaningful?

Yes. I think I would go back to, first, this is really important when you open up a new field in medicine that there is a potential to have a surrogate endpoint and so we and IgAN are at an incredibly privileged position to put forward a 9-month proteinuria reductions and have the hope that you could get an accelerated approval. That was really put forward by academics and regulators to show that a 30% reduction in proteinuria at 9 months leads to at least a 10-year delay in end-stage renal disease. That's quantifiable clinical benefit that is meaningful to patients, providers and even payers within renal autoimmune disease. So that's a pretty meaningful number. And now we know that an approved drug, TARPEYO is the only one approved had a delta of 27% from placebo. So I think we need to be really thoughtful about what number is the bar. The bar really is set by the only approved drug, which was over a 30% reduction from baseline, and they achieved under a 30% delta from placebo, but that led to an approval. We'll continue to see this play out with other agents in the field, but that's the bar. We've been very consistent about that being our target and raising the bar to 40% or 50%, I think, doesn't have a sound scientific basis behind it.

You've committed to running a Phase III in IgAN. One of the questions is you didn't have perhaps the magnitude of dose response that you were looking for. Are you -- what gives you the comfort to move forward given you didn't see this?