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

Okay. Good afternoon. We'll continue with the next session. I'm Paul Choi, and I cover the SMID-cap Biotech sector here at Goldman Sachs. It's my pleasure to have Vera Therapeutics here on stage with us. To my immediate left is CEO, Marshall Fordyce, and to my far left, Chief Medical Officer, Rob Brenner. Maybe what we'll do is let Marshall kick it off with some -- maybe some high-level comments or an introduction of Vera, kind of what the company is and what the background is. I'm sure we'll talk a little bit about the data that just came out here and contextualizing it in the landscape of the IgAN category and then just sort of thinking about the forward. So Marshall, I turn it over to you.

Paul, thanks so much for the chance to be here and a great conference. I'm Marshall Fordyce. I'm the Founder and CEO, a physician by background. We're just about a week out from the announcement of our positive Phase III results for atacicept in the autoimmune kidney condition, IgA nephropathy. We've been a publicly traded company on NASDAQ for just over 4 years. We're based in San Francisco. It's been a phenomenal pathway to get to where we are today. I can say that atacicept is now on track to be the first BAFF/APRIL inhibitor approved in any indication. We think that it's a big idea to shift the treatment of autoimmune disease from approaches that suppress the immune system and make patients susceptible to infections such as high-dose steroids or B-cell depleters and instead, take an approach that modulates the immune system such that you can impact the disease and get efficacy, but also preserve safety and provide patients with a convenient format to take their medicine. We've checked each of those boxes throughout our development pathway. Atacicept, 150 milligrams is delivered as a 1 ml or 1cc subcutaneous dose. Atacicept is the only program in Phase II and Phase III to be studied as an at-home self-administered dose. And we're on track to deliver an auto-injector at potential commercial launch mid next year. We're also different in that we have 2-year GFR data in Phase II. And this really was our big news last year in 2024, where we ran our Phase II trial, again, distinct in the field, we ran that trial for 2 years, and we showed that patients who are young, on average, about 40 years old, who are at high risk of disease progression. So these patients are losing up to 10% of their kidney function per year. That means from 40 years old to 50 years old, they go on dialysis. We showed that, that same patient population taking atacicept preserved their kidney function. We also showed earlier this year at JPMorgan that if you take them off of atacicept, the immune complexes come back and the GFR starts to decline again. So we've actually shown some data supporting chronic dosing just from an efficacy perspective. There's nothing quite like opening the envelope and looking at Phase III data. This is the result of a gold standard multinational randomized controlled trial against placebo. And the surrogate endpoint to initiate a discussion with FDA around accelerated approval is a 36-week measure of proteinuria. We showed a 46% reduction from baseline in proteinuria on atacicept. Placebo was minus 7. So we had a 42% adjusted effect. Safety was better on atacicept than placebo. So balanced. That was fantastic to see, particularly on the infection side, sort of ratifying that hypothesis we have. And again, we had strong retention on the study. These are -- it's a phenomenal place for us to be. We are now taking this unusual data set where we've got GFR from Phase II and strong Phase III results, taking that to FDA to discuss the regulatory path forward. We currently plan to file our BLA in the fourth quarter of this year. We can assume a 2- plus 6-month prior review timeline to get us to a mid-'26 commercial launch. This is a big potential market, many patients. So in the U.S. alone, there are about 160,000 patients with biopsy-proven IgAN. Roughly half of them meet these criteria of high risk of disease progression. And so that's about 80,000. And when you look at the current products that are approved, that describes what most would estimate to be about a $10 billion market for the U.S. and IgAN overall. And we believe we're well positioned now with strong Phase III data to take a substantial portion of that and bring atacicept to patients as quickly as possible. So a great position to be in now a week after our Phase III results announcement.

Okay. Great. Maybe let's unpack that a little bit and either for you or Rob. As we think about sort of the trial design and the trial population that you studied here in ORIGIN 3, can you maybe help us understand how representative is this of your typical IgAN patient that's out there in the U.S. or globally. I think there are some questions in the investment community of how your patient baselines compared to those in other IgAN studies and just understanding what is -- how bad is their disease severity, what are their background therapies on? Maybe just help us sort of level set how the population you studied compares to some of the others.

Yes. Thanks, Paul. In general, very similar to what we did in Phase II. I think the population represents the global burden of IgA nephropathy. As Marshall said, patients are relatively young, mean age in our clinical program, both in Phase II and Phase III was about 39 or 40 years. They had been biopsied about 2.5 years earlier. At baseline, they have a GFR of about 65 milliliters per minute per year. that represents about a 40% reduction in their endogenous kidney function at the point that they enrolled in the trial. They were geographically representative of the disease, about half the patients of Asian descent, about half the patients were Caucasians, a slight predominance for male sex, consistent with epidemiology. There's slightly more male patients than female patients. At baseline, their proteinuria was about 1.7 grams per day, pretty significant amount of proteinuria, very similar to what we saw in Phase II. And almost all patients on stable doses of either an ACE inhibitor or an angiotensin receptor antagonist. And about a little over 50% of the patients in the Phase III were on concomitant use of SGLT2 inhibitors. That is one thing that differed from Phase II, which was an earlier trial that was only about 15%, and that reflects the increased use of those agents generally in patients with chronic kidney disease.

Okay. Great. Just on that last point on SGLT2 background, I think you had a higher rate of patients in your study versus some of the other studies. Maybe just one of the questions we get is just how do you think about the contribution of the components? Is there actually an incremental burden to prove out a drug if you have patients on more patients on background therapy? Can you just help us think through that?

Yes. So of all the trials that have reported results, the timing of when the Vera program was executed is the most recent. Therefore, it's not at all surprising to me that in the ORIGIN program, we had the highest use of concomitant SGLT2 inhibition, a little bit north of where the Otsuka program for sibeprenlimab was and certainly much more use than we saw in previous trials. It turns out that being on those drugs or not on those drugs had no impact in the readout of the primary endpoint, the reduction in proteinuria at week 36 for us. I think simply reflects here's what is going on in the community. What's interesting is the patients in the Vera program were all receiving a RAS agent, an ACE or an ARB. More than half were receiving an SGLT2 inhibitor. And they still had a GFR that was already 40% reduced from normal [indiscernible] 1.7 grams protein per day of proteinuria. So this is a high-risk population. I think everybody would agree with that. And it shows that despite the availability of ACE inhibitors and SGLT2 inhibitors, there's a big, big unmet medical need for a drug that could have a big impact on this.

Great. I want to ask a little bit about what you learned and what you implemented in your Phase III versus your Phase II. I think when you top line your Phase II data back a little while, there were some questions on the ITT analysis versus the as-treated analysis. Here, it seems like there's much more consistency and just kind of how did you go about improving trial execution and compliance and other patient adherence and things like that?

Yes. So while I said that there was no impact on concomitant use of drugs like ACEs or ARBs or SGLT2 inhibitors. I wouldn't say that if those drugs were introduced during the course of the study or if the dose was adjusted during the course of the study because those drugs do have an impact on proteinuria. Therefore, what we learned in Phase II was it's really important to not just write in the protocol to maintain stability and dosing of those agents or not to start them if they weren't on them before enrollment, but we had to police it. And we had to go and point out here are examples where the coordinator or the principal investigator deviated from what was written in the protocol. And after the integrated execution team in terms of our contract research partners, the Vera team, the coordinators and the PIs, et cetera, once we had more familiarity with what is expected, as we moved into Phase III, we saw many fewer examples of deviations that were clinically relevant. So as you point out in the Phase II, a per protocol analysis that excluded the big deviations that would impact our ability to read out proteinuria versus ITT had a more marked difference in the results. In Phase III, the results were almost identical, and there were very few examples of significant protocol deviations that even carved out people into a per protocol analysis. So I think the Phase III data are the most representative that we have thus far. The other thing I would say is the variance between a proteinuria reduction in the mid-30s, the mid-40s, even in the mid-50s is really modest. And I would say the community in general, prescribing doctors would say, if I see a 20% difference in proteinuria, I don't really use that as a guiding principle to determine what drug to use for my patients. I'm going to look at the totality of evidence anchored on GFR, including safety, including convenience and say, based on all of that, that's how I'm going to decide what drug to prescribe. So I think net-net, we look from Phase II to Phase III, it's the Phase III results that they're most compelling. The Phase II results are supportive and consistent, and it puts Vera in a really strong position as we look forward to the future commercialization of the drug.

Okay. Great. Maybe just to follow up on that point for either you, Marshall or Rob. As you think about the totality of your data. There was also some competitor updates in the last week as well. Can you help us contextualize those results versus your results? And just sort of what would you highlight as sort of the key differences either in the study populations or the end results or any particular metric that in your mind stood out?

I'll start and then, Rob, if you've got others to add. I would point out that the drug characteristics that are meaningful to patients, physicians and payers are efficacy, safety and patient convenience. In IgA nephropathy, as Rob has pointed out, GFR is the most important thing. We showed some of that data from independent research last Monday, and I think that's a consistent response. We don't think that the difference between a 42% versus a 50% placebo-adjusted number is going to be clinically meaningful. The safety looks quite comparable, and that's great. I think it's great for the idea that atacicept could really be considered a first-line therapy. And I think that's going to be an important piece of what we're interested in doing as we propose a value story around atacicept relative to untreated disease. And third is patient convenience. Atacicept is the only one dosed at home as a self-administered drug in Phase II and Phase III. We know that, that is a very convenient format. We know that others are reaching for that, and we'll look forward to seeing ultimately what ends up in the label. So that's how I would kind of parse out our own data and competitor data. There are some competitor data sets out there that are in less severe populations or they're in uncontrolled populations, and we would be circumspect about comparing across data sets that are, for example, multinational blinded placebo-controlled trial versus one that's open label. Rob, anything you'd add to the competitor updates?

Yes, I agree with everything you said. I think last week was a transformative week for patients with glomerular disease and patients with IgA nephropathy in particular. Never in the history of kidney drug development have we seen results so compelling for patients who have biopsy-proven kidney ailment. So the future has never looked brighter for patients, and it's -- I'm thrilled to be part of it. I think there are some things that are slightly different between the programs. It was generally, I think, a terrific data set for Otsuka. I congratulate them for their release. I think it's not lost on us, and I think on many physicians that the Otsuka experience reflected a clinical trial design that had patients come to the office to get their monthly injection throughout the program. Whether or not the data looks similar when patients in the future might have the opportunity to dose themselves at home, we don't know. But I think it was a strong data set. There are some other subtleties in the analytic approach and approach to missing data that we don't know yet and nor would we at this stage in disclosure. I think when we see the full label, when we see a peer-reviewed publication, we'll learn more. So at the moment, we just know that there are some unanswered questions. But in general, I think it's a great window for this field.

Okay. Great. Marshall, I want to turn back to something you said earlier just on home administration and thinking about your TPP or target product profile. And often typically in clinical trials, you get good adherence, you get good patient compliance in the clinical trial sort of framework. But as you think about the real-world setting, you talked also about developing an auto-injector for potentially in the same time for launch. Just sort of where are you in terms of efforts with that versus sort of a prefilled syringe approach that might be used for home administration?

Yes. So the PFS is what we've used in Phase III. It's 1 cc. So it's really not -- the only difference between a PFS and an auto-injector is you're either depressing the plunger for 1 cc yourself in a 3- to 4- second injection time with about a 27-gauge needle versus a button push, which is really, I think, the newer commercial standard that patients would expect and a variety of biologics. We're on track to deliver that at launch. So we've done the work, and that will be part of our initial filing.

Okay. Yes. Great. I want to talk maybe a little bit about next steps for your regulatory process. You've top line the data. I think you've talked about probably presenting at a fall medical meeting, which I think you mean Kidney Week seems to be the logical forum. Just in terms of incremental details for the medical meeting presentation, is there anything you'd call out that we would look for that we didn't see yet so far in the top line data?

Yes. I think it would be -- we're looking forward to having an opportunity to present the data at a big medical congress. As you say, ASM makes a lot of sense. It's in the fall in Houston this year. With our Phase II program when we shared the final results from the Phase II, we had a concomitant peer-reviewed publication. At the same time, it would be nice if we're able to deliver on that this go around. We mentioned in our press release that in addition to the primary endpoint for proteinuria for the other prespecified endpoints that we looked at, all the results are comparable, if not slightly better than what we saw in Phase II. Importantly, we have disclosed that we're not commenting publicly at this time on the eGFR result. Not that we wouldn't like to. It's not that we don't think the data would be helpful. But the FDA has asked all sponsors not to disclose GFR results while the trial is ongoing. And like all the other programs, our program is still ongoing. So we're not going to disclose that, and we won't share that at AS.

So nothing at ASN on that data to date. Would there be any potential for an interim update prior to the final result on GFR happening, let's say, in the '26 time frame?

Not per the statistical analysis plan that has been agreed upon with the regulatory authority. They really don't want to have access to GFR after the cut that we just had. Certainly, as a sponsor, we've had access to the GFR results. And as we mentioned in the press release and our webcast last Monday, in the next few weeks, we'll be meeting with the FDA to review the results. That will include conversations about the GFR results, but that won't be made public.

Okay. Very good. I want to ask a little bit about how the KOLs are responding in the wake of what has been a busy week on the data front between your program and competing programs. And just maybe helping us triangulate how the kidney community has responded to these data sets. And maybe based on the latest results, has their mindset changed on how to think about the drug of choice based on proteinuria results versus GFR results? Just sort of what's, I guess, the recent or latest feedback from what you've heard?

Yes. So I think to answer that question, I want to zoom out a little bit and just talk about where we are in general today. The cadence of data release from Vera that began last January with 72-week data increased momentum last fall with 96-week data and then has now matured with the release of the Phase III data, has enabled the medical team at Vera to have ongoing deep and meaningful conversations with the community. And we know from the pulse surveys that we do that the awareness of and appreciation of the data for atacicept has offended into the lead in the B cell modulatory landscape for IgA nephropathy. And that's really due to the hard work of our colleagues back at Vera who have been so well connected with the nephrology community. With that, there was great awareness of our release prior to the ERA meeting. And the feedback I received from the team on the ground was there was palpable buzz about our results even as the ERA meeting was getting underway in advance of when Otsuka had their release on Friday, coming out of the dual presentations, ours by webcast, theirs at the meeting, I think there are many thought leaders who are starting to wonder about the envisioned sequence of how drugs would be used in this disease. And I think more and more as people digest what they have had exposure to, they're starting to think that maybe the foundational treatment, to use Marshall's words, is going to be a B-cell modulator. And we think based on the totality of data that are available, atacicept is the ideal drug to play that role. And maybe to think a little bit more about what is the value of an SGLT2 inhibitor in this population, right? And those are fundamental questions that I think a year ago, none of us would have ventured to propose, but based on the strength of the data that was seen, including not just the efficacy, but the overwhelmingly clear safety profile, it really raises fundamental questions about what the future prescription is going to look like. And I think B cell modulators are going to play a very foundational role in the prescription for this disease.

Okay. Great. Marshall, I want to turn back to something you said earlier, which was you framed out a timeline that could see atacicept commercialize mid next year. That seems to embed a priority review assumption. I guess, what is your level of confidence in getting a priority review from the agency based on your filing? And in case it's a regular way review, which would presumably push you out a few more months after that. I want to -- as a follow-up question, I want to ask, how are you thinking about sequencing and setting up your commercial preparations there?

Yes. I would say our confidence in priority review is high with breakthrough designation already in hand. To our knowledge, we and Otsuka are the ones with that designation, and that has a high probability of priority review. We're commercially prepared. We have been for some time. We brought on initial commercial planning close to 3 or 4 years ago. We brought in commercial launch leadership last year. And now really all of those components of the team have been built. There's a lot of enthusiasm now with the Phase III profile that the final piece is bringing in the sales force. So this is really a significant effort we've made, starting with the clinical development piece, moving on to medical affairs. As Rob has shared, we have deep connectivity to the nephrology community and now moving into commercialization and what does that look like. We started to show a little bit. So we showed our Head of Commercial, Matt Skelton, presented a few slides on Monday, describing some of the awareness that's changed. the payer mix being favorable, some attributes that I think we all agree make this a very attractive commercial market as we serve an unmet need. And I want to just return to Rob's perspective as a decades-serving nephrologist, the magnitude of impact of atacicept, and we could give credit broadly to any drug that matches our 2-year GFR data, that's a massive shift in the medical standard. And I think that's really important to appreciate. I do think that the safety profile that we shared last week starts to enable a real discussion of earlier and earlier use. The baseline characteristics of study participants that Rob described may not be the future one. I mean I hope that 40-year-olds don't end up with a GFR of 60 when they've got a biopsy-proven IgAN diagnosis and there's access to atacicept. So I do think that there should be an increasing appreciation for how substantial the magnitude of impact that this drug will have in this disease area. We're already expanding and from an operational side as the CEO, we've taken steps really at risk and early to expand into the non-high-risk population in IgAN, so into moderate and low risk to post-transplant to IgA vasculitis to adolescents. That's all captured in our ongoing PIONEER study. We're the only ones conducting such a trial. And we're also moving into additional autoantibody-driven renal diseases like membranous nephropathy and antinephrine FSGS and MCD. So to us, that's the appropriate way to start to try to address a larger unmet need besides our initial Phase III patient population. We're thrilled to have a profile like this and really have an opportunity to bring the drug to patients.

Great. I want to come back to PIONEER in a moment, but maybe 1 or 2 more on the commercial side is now that you have the Phase III data in hand, just can you maybe walk us through the cadence of what your payer conversation plans might look like over the balance of 2025. Given the sort of median patients in your clinical trial in the disease, we're not really talking about a Medicare age population. So presumably, most of this market will be -- or a good chunk of it will be commercial. So can you maybe talk about where you are, first of all, in your payer discussions? And then secondly, given that there are some generic drugs like ACE and ARBs, et cetera, and to some degree, SGLT2s available out there, just how are they thinking about access and tiering and so forth, just preliminary conversations there?

Yes, happy to share a little bit here, but we'll come back and share a bit more. We've already had discussions with payers. We have our payer access leadership in place. And I would say that, as you point out, look, this market has some features of a very attractive commercial market. The age is young. So that is over 75% private pay. And look, the effect size is meaningful to payers. We've explored detailed questions, for example, in terms of how meaningful GFR is in those conversations. We've had that question in hand since our Phase II readout last year. So we've laid a lot of groundwork. I think it's fair to say that sometime after our BLA filing, maybe after our BLA expected acceptance, we'll come to the market with a commercial day and start to outline how we see this start to play out in 2026. So yes, it's all coming, incredibly exciting time.

Okay. And maybe just one more. Just as a rough framework. Obviously, the goal here is to prevent patients from worsening and going on to dialysis, which is quite costly and obviously has its own mortality considerations as well. So -- is that -- how do you guide investors to thinking about pricing versus cost benefit of avoiding dialysis and kidney deterioration down the road?

Yes. I mean we always put value and access in the same bucket. And I think it starts with the data and the value story. And as you point out, particularly when we start with the high-risk population, we're talking about avoiding dialysis, which is a terrible outcome. 5-year mortality is similar to cancer, and it's a bad outcome from a patient, family, provider and health care system perspective. We've had a health economic outcome research team in place for some time as well. So generating that value story is something that's been ongoing work for us as well. So yes, I would just say this is going to be an exciting value story to tell.

Okay. Great. Returning maybe to the subject of your PIONEER basket study and just thinking about the other populations. I'm sure you and your Board are focused on extracting the maximum value out of atacicept here. So with the PIONEER study, can you maybe just update us on, first of all, on the status of it, how it's going? And then what do you think is sort of the sort of highest value, lowest hanging fruit type opportunities that could emerge from the initial data set for you to prosecute down the road?

Yes, I'll start, and then I'll hand it to Rob. But it's really hopefully a very logical flow. We think the best value for Vera is to commercialize and win in IgAN with atacicept full stop. I mean executing on that launch at the highest level is the #1 priority for the company. Second is to explore an expanded group of patients who could benefit, and that is the value of the PIONEER study. And that could quickly transition into an expansion of where we take the label and our commercial approach.

Yes. PIONEER is a super interesting program for a number of reasons. One, I am thrilled as a corporate officer of the company that we took the bold step to not wait until after we had Phase III results or even after we completed the full Phase II before we decided to invest and study the broad fingerprint of IgA-mediated disease. That took a lot of leadership. It's also been incredibly well received by the medical community that we're moving forward into adolescents. We're talking about patients with vasculitis. We're talking transplant recipients who have recurrent disease, patients with low proteinuria, very high proteinuria or very, very advanced with loss of GFR to try and stave off the need for dialysis. So that's phenomenal. What wasn't lost on us and was part of our strategic assessment was that the same investigators that are caring for patients with all these forms of IgA nephropathy are caring for patients with other forms of autoimmune kidney disease. Therefore, in the construct of a basket trial, we could simultaneously advance the cause of atacicept to have a real impact in IgA nephropathy and get the first readout of the benefit of atacicept in 2 forms of autoantibody-mediated glomerular disease, as Marshall says, one being anti-PLA2R antibody positive membranous nephropathy and also antinephrinepositive focal segmental glomerulosclerosis and minimal change disease. This is a really lovely way for us with a single program to give us insights across 3 different populations. And because it's an open-label program, we'll be able to survey the data on an ongoing basis. And once we feel we've learned enough to be able to architect a Phase III registrational program for the new indications, we can move forward. In the IGA space, probably a little different. If we look at full approval labels for the 2 drugs that have received approval from FDA, those indications are rather broad. And so a case could be made that any patient who is at risk for disease progression is covered, and those are patients that we're studying in the IgAN component of the PIONEER program. So these are the first new indications outside of IgAN that we're going to be studying. Every day, our team hears about other requests, study other forms of autoimmune kidney disease that aren't captured by PIONEER today. We've written it in such a way that we could add other cohorts moving forward, and we may choose to do that. And then finally, we recognize that autoimmunity is not confined to the kidney. And so what a great time today on the heels of positive Phase III data readout to now be enabled to start thinking with more granularity around what we're going to do to utilize atacicept and investigate it in forms of autoimmunity outside of renal disease. And so all of that is to come as we move forward.

Great. I want to ask a corporate question, which is you also recently announced an update to your debt financing with Oxford and which expanded that relationship as well. And so based on that, can you maybe tell us how you're thinking about -- now you have additional resources for funding commercialization as well as potentially advancing VT-109 into the clinic. I just wanted to ask, how does your capital plan or capital -- cash runway look like now versus commercialization and advancing into these other areas that Rob just referenced clinically?

Yes, happy to answer that, Paul. We're well resourced. We have $590 million in cash. And with this credit facility that we've had with our great partners that we've now expanded to a total facility of up to $500 million, that gives us $1 billion to put to work to launch atacicept to grow the pipeline, and we're thrilled to be in that position. So we will give guidance that we're well-resourced through approval and launch. And we're looking forward to sharing more about how the corporate strategy changes and really on the heels of foundationally paradigm-shifting Phase III data just last week.

Okay. Great. We're almost here up on time. So we'll end it on that note. Thanks to Marshall and Rob for joining us here on stage.

Thanks so much for the opportunity, Paul.

Thank you.