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

So welcome to the Cantor Global Healthcare Conference. I'm Pete Stavropoulos, a biotech analyst with Cantor. With us, we have Vera Therapeutics, a company I cover, and I'm pleased to introduce Marshall Fordyce and CEO; and Robert Brenner, CMO. Welcome.

Thanks so much, Pete. Great to be here.

Let's start off with a brief intro for those that don't know who you are...

Sure. I'm Marshall Fordyce. I'm the Founder and CEO of Vera Therapeutics based in San Francisco. We are -- I've been a public biotech company now for about 4 years, made great progress with our lead product candidate called atacicept which is an immune modulator for B-cell-driven diseases. We've recently read out our Phase III trial in a major unmet medical need called IgA Nephropathy, and we are now planning to file for a BLA in the fourth quarter this year. So very shortly, we'll file our package and expect to be on the market mid next year. So really exciting time and have been building the commercial profile of the company in the recent years.

And I'm Rob Brenner, Chief Medical Officer. I've been with the company for -- coming up on 2 years. It's been an amazing journey. I'm a nephrologist by training. And I think the kidney community is appreciating that we're on the precipice of a new era in our ability to manage patients with IgA Nephropathy and other forms of autoimmune kidney disease. It's a super exciting time, both for patients, for providers and certainly for all the employees of Vera.

Yes. So when I was in [ move to diligence ] in the IgAN space, I remember -- it was probably around November 2023, I had spoken to a KOL, nephrologist, but not an IgAN KOL but looking at acute kidney injury. And I had asked him about your 36-week data and his perspective on IgAN. And he was a little bit dismissive at that time, meaning like IgAN kicked the ball down the road and not that big of a deal. And then you had your 72-week data in January. And then I spoke to him again in March after that, and he had a completely different perspective and a different tune. And he was impressed by your eGFR data, 72 weeks. And so first, the exact -- what is the burden of disease? And is it something that you just kicked down the road? That's number one. And then number two, are the more, let's say, of community-based nephrologists becoming more and more aware of IgAN and your drug?

I'd love to start and then Rob, as the nephrologist on the stage talk about this. But this is a large unmet need. I'm a physician as well by background. In the United States alone, there are 160,000 patients with biopsy-proven IgAN, of which at least half have high risk of disease progression. This is a significant unmet need. Diagnosis on average is delayed, but it happens currently at the age of 35 years old. We now have seen, Pete, in our data and others' data that if you're on placebo with that profile, you're on dialysis before the age of 50. So this is an urgent unmet need. And we're the first and only to show that on atacicept over 2 years, you can stop kidney function decline as measured by GFR. And that data set is not just understood by KOLs, it's understood in the field. Last week, I was in Florida talking to nephrologists who are not normally on stages, and they're very aware of our Phase II data. So that's an exciting moment for us. Rob, any other thoughts on GFR data?

Yes. It's -- in the history of drug development in kidney disease, we've never been in a situation where we have a population of patients who actually had a kidney biopsy and have been found to have a specific kidney disease where we've been able to intervene with an agent that changes the course of the progression of their kidney function from one that has them on pace, to Marshall's point, of maybe needing dialysis in a decade to one where they could potentially live the remainder of their life without the need for a transplant or to go on dialysis. It's never happened before. And now we're on the verge of being able to provide a drug or a new class of drugs are able to do that for patients, starting with IgA Nephropathy. And I think it's the magnitude of the evolution in a data package that is now sitting in front of clinicians that they've never seen before that does create this opportunity.

So you just mentioned 160,000 patients in the U.S. But when you look at different companies and when you look at the academic literature, when I go to the academic literature, it's about 112,000 where I put it. But I also see Novartis had about 185,000 patients in the U.S. and Otsuka published a paper, I think, late last year, showing about 200,000. And so what's your perspective on that? Are you being conservative or...

We're generally conservative. We do think that this disease is underdiagnosed. So somewhere in the middle of 160,000, Pete. And as you can do pretty simple math with current pricing, that's a $10 billion to $20 billion market. So it's a very large opportunity commercially. But more importantly, we're focused on identifying those patients beyond just those who currently have biopsy but also pushing out -- when you bring a transformative new therapy to patients, diagnosis tend to increase because there's a reason to diagnose, and you can do something about the disease. I've seen in prior work in infectious disease. We think that's the situation again here.

So touching on atacicept. It's designed to address the disease from an immunological standpoint. Can you just walk us through the therapeutic hypothesis, which you've proven with your Phase II and Phase III data that we'll get into in a moment. And from a mechanistic standpoint, why the drug has disease-modifying properties as well, not compromising safety.

Sure. do you want to take it?

Yes. So what is IgA Nephropathy? It's a B cell disorder with kidney pathology. So this is a disease that has its hallmark is a formation of an immune complex. There's an autoantigen, which is recognized by an autoantibody. Those immune complexes circulate, they deposit in the kidney where they drive inflammation, fibrosis, nephron loss and kidney failure. But we know that both components of the immune complex originate in the B cell. So the B cell is the cell that we want to intervene against. How might we do that? It turns out that there are 2 cytokines that act as the energy source for B cells that are fueling the production of immunoglobulins. And atacicept is an example of a rationally designed biologic agents. It has an extracellular binding domain for both of those 2 cytokines. One is called BAFF, one is called APRIL. And it's got picomolar binding affinity for both of them. It's a soluble receptor that we can administer to patients. They can administer themselves once weekly at home using an auto-injector, low volume. And we can reduce the amount of BAFF and APRIL. And when we do that, we reduce the expression of antibodies. We reduce the generation of the immune complex. We reduce the inflammatory burden in the kidney. We lower proteinuria, a marker of disease, and we can stabilize GFR. So that's the mechanism of the drug, and those are the key readouts that we've seen through the Phase II and now into the Phase III program.

Yes. The hypothesis that we've proven out is target the source of the disease and see everything downstream actually resolved in terms of inflammation, proteinuria and GFR. And that's been very exciting to [ sibe ].

Yes. So you have shared multiple data sets. And key for me is that this consistency there, right, Phase II to Phase III. In fact, you didn't see a degradation of signal. It actually increased. So the first thing to touch on is the patient population that you enrolled, A, were there any differences? And also when you compare to other studies such as [indiscernible]?

Yes. So first, internal consistency within the atacicept program from Phase II to Phase III. In the Phase II and Phase III programs, we enrolled patients who had same age. They were about 40 years old. They have the same amount of kidney function remaining, about a GFR of what we call 60 mls per minute, which means they've lost 40% of their endogenous kidney function at the time they enrolled. They had the same vintage from the time that they were diagnosed with the disease of a couple of years. They have the same amount of protein in their urine. They had the same ethnic background, and we know that IgA Nephropathy is overexpressed in patients of Asian descent. So that was accounted for. The one difference in the Vera program between Phase II and Phase III was the amount -- number of patients who are receiving SGLT2 inhibitors on top of an ACE inhibitor or an angiotensin receptor antagonist. In Phase II, it was 15%. In Phase III, it was 50%. What was super interesting is that the presence or absence of an SGLT2 inhibitor had 0 impact on the results that we've observed in the clinical program.

Okay. When you do look at the data, Phase II to Phase III, your Phase III was in line with the protocol versus the ITT. And so just walk us through how you accomplished that. And when it comes to safety outcomes, particularly infections, what were the observations in Phase III?

Yes. The Phase II program studied 3 different doses of atacicept versus placebo. There were 30-odd participants in each cohort and the proteinuria reduction was robust, well north of what the FDA is looking for, which is a 30% reduction compared to placebo. In the Phase III program in 203 participants randomized to placebo or the commercial dose, which will be 150 milligrams administered as a 1-ml volume once a week by patients at home, we saw a 46% reduction in proteinuria in the active group and overall a 42% placebo-adjusted reduction, well north of the FDA 30% threshold. Those results are as impressive, if not more impressive than what we saw in Phase II. I think it has to do with the sample size. I think it has to do with the effectiveness of our ability to have people follow the protocol as it's written and not deviate. So I think it's a very good representation of the magnitude of effect that patients will see commercially once the drug is approved.

All right. And at ASN last year, you did present a 96-week data from your Phase II. And can you just discuss those data and what gives you confidence that you're actually going to replicate it in Phase III?

Yes. Great question. The most important thing that we measure in patients with kidney disease is a measure of their function. And what we use is something called glomerular filtration rate or GFR. When people are young and healthy, they've got a GFR of about 100 mls per minute. And when patients need kidney replacement to stay alive with either a transplant or dialysis, they have about 15 mls per minute or less. So only 10% or 15% of their endogenous kidney function. People, once they reach the age of about 40, lose about 1 ml per minute per year just as part of the normal aging process. So unfortunately, looking around the room, that's what all of us are experiencing today. The 96-week data that we showed was this long-term experience of patients receiving atacicept at home. They entered with a GFR of about 60. So they're already about 40% reduced from completely normal, but they've got a biopsy-proven kidney disease, and they're losing about 6 mls per minute per year, even when they're on an ACE inhibitor and an SGLT2 inhibitor, maybe even ERA or steroid. So that means they're losing 10% of the remaining kidney function a year. And to Marshall's point, they are on a track to needing dialysis or a transplant within a decade. What we showed is that over the 96 weeks, over 2 years, they had a GFR slope of minus 0.6 mls per minute. That means at that rate, if they're 40 years old, they're going to live the rest of their life without needing dialysis or a transplant. That's how transformative the data set was, and it's unprecedented, as I said earlier, in the history of kidney drug development. What do I think for Phase III? Well, we've seen the GFR data for the interim analysis at 36 weeks. We haven't disclosed it publicly because the FDA has asked us not to. The FDA has seen the results. I will tell you the only reason we're not disclosing the results as now is because the FDA has asked us to. There'd be no other reason for us not to disclose it. And my expectation is that the GFR results from the Phase III program, when it completes, will look very comparable to what we saw in Phase II.

And so you are going to show some data at ASN, I'm assuming you are. What should we expect to see and what should we be looking out for that?

Yes. In my view, there are 4 parameters that we look at to provide evidence for true disease modification in IgA Nephropathy. First, we look for a reduction in sort of the burden of immune complex. We can measure the autoantigen. It's a form of IgA called galactose-deficient IgA1. We can measure that. And we showed in Phase II that there was a 2/3 reduction in the Gd-IgA1. So I would hope that we'll be able to disclose the Gd-IgA1 result at ASN. Next, we look at the burden of inflammation in the kidney and people who have IgA Nephropathy. And there's an easy way to do that. We can use a point-of-care device. We can use urine dipstick for hematuria for blood in the urine. And in the Phase II program, we showed that there was an 80% reduction in hematuria in patients who had blood in their urine at baseline. To me, very clear evidence that we're having an anti-inflammatory effect, and it begins early when you start using the drug. Then we can measure proteinuria, which is the surrogate endpoint that the FDA uses to grant accelerated approval. And as I said, the threshold is a 30% or larger reduction compared to placebo. And then the fourth component is the GFR. And so we've shown for the Phase II, the quartet of findings that all are improved that indicate true disease modification. We'll show as much of that quartet as we can at ASN, but still to align with FDA expectations of what we disclosed.

Okay. So after you did announce the Phase III data for UPCR competitor program from Otsuka, they also presented at ERA, their Phase III data. So how do the 2 data sets sort of compare, understanding the different studies? Any key differences worth highlighting such as patient population, efficacy outcomes or anything else?

Yes. I think as much as we would like these trials to be identical and the super imposition of one another, they're not. There are some meaningful differences in the study. The high-level take is that the results from atacicept are incredibly encouraging. And I think the superficial results from Otsuka's program are also very encouraging. I think until we get to the point where we have final results that make it into a label, make it into a peer-reviewed publication, there may be some movement a little bit with each of the data sets. But Vera is incredibly confident that the results that we've demonstrated both in Phase II and Phase III reflect a new era for future management of this disease and the future has never looked brighter for patients with IgA Nephropathy.

Some movement in data sets, what do you mean by that?

If you look at the precedent in this space for data disclosure followed by publication and approval labels, there's not a one-to-one concordance of what the preliminary release data look like compared to what's presented. And so my expectation is what we saw in Vienna may not reflect what is actually written in the label or in a peer-reviewed manuscript. That's my only point.

Okay. So you do have Extend? It's the open-label extension for ORIGIN. Just give us a sense, if you can, if not quantitatively, but qualitatively, how the rollover is going.

It's going great. We've been enrolling that program since the end of last year. It is an opportunity for any participant in our clinical program who's completed a study to have an opportunity to receive atacicept in an extension program until it's approved in the region in which they reside. We feel that we have an obligation to do that for patients. It's also provided an opportunity for us to have some real-world experience with our auto-injector, which we're going to have when we launch. So that's been a nice opportunity. Enrollment is going great. Program is moving forward.

I'd also highlight what we shared last year, which is when treatment with atacicept is interrupted, the disease comes back, and we measure that by the recurrence of the immune complexes and a continued decline in GFR. So this data set is going to be pretty interesting to show not just the continued chronic dosing, but what happens after interruption drug incredibly important for physicians to see what is the risk/benefit profile of taking this drug and what an interruption might be.

You are reenrolling patients from the Phase IIb that have that drug holiday.

Yes.