Viridian Therapeutics, Inc. (VRDN) Earnings Call Transcript & Summary

Hi. I'm Jonathan Violin, CEO of Viridian Therapeutics. Wonderful to be here today and very much appreciate the invitation to the Cowen Conference. Viridian Therapeutics is, in many ways, a brand-new company. So really pleased to be able to share our story with you. Viridian was founded as a private company outside Boston about a year ago. It was then acquired by miRagen Therapeutics in Colorado in October. So we're now a 2-site company based in Boulder with an office in Waltham, Massachusetts. And have spent the last few months really starting to build the team and move forward some projects that we're really excited about, and I'm happy to tell you a little bit about today. So before I dive in, of course, I will be making forward-looking statements. So please see our SEC filings for our various risk disclosures. And I thought I would start by describing how we think about innovation in drug discovery. I think as we all know, there's a lot of emphasis in this industry on looking for new targets, new modalities, new technologies, really important, exciting work. But in our view, that often leads some areas under competitive and opportunities to do better for patients, particularly in some indications, particularly rare diseases, where we think there's room for more entrants to make the kind of innovations that really matter from the perspective of products. And so when we think about our approach, we look for areas where there are suboptimal products. We see limited patient access sometimes and very high prices. And we look for product-focused hypotheses where we can look at validated science, so targets that have been proven, trusted modalities, we focus on antibodies, and proven technologies in ways that we can combine these in a way that doesn't take on a lot of biology or technology risk, but that we think make for some very interesting and hopefully important new molecules. And so we've begun building out our pipeline of projects to pursue this philosophy, starting with several projects in thyroid eye disease. So we'll spend most of the time today talking about our thyroid eye disease program. We do also have, in discovery stage, another program, VRDN-004, for different target, different indication, but not going to share much about that today. We'll really spend our time thinking about thyroid eye disease. But we do have a vision to build this company for the long run looking for these opportunities in under-competitive areas to bring forward some important new medicines. So for those of you who aren't familiar with thyroid eye disease, or TED, this is quite a debilitating disease. So as you can see in the photo on the right, this is a disease characterized by orbital inflammation and expansion of the tissue behind the eye that leads to the physical displacement of the eyeball. It's called proptosis, the bulging eye as you see here. That can cause misalignments, leading to double vision, also alterations and pain and can lead to potential blindness. Best guess is this occurs in about 15,000 to 20,000 new patients per year, severe enough to meet intervention. And manifests first in an acute phase that can progress after 6 to 24 months to a fibrotic or inactive stage, which has potential to cause permanent damage and blindness. Historically, treatment options were quite poor. Surgery, radiation, steroids, lifestyle changes that didn't really work very well. And so this was a set of patients who had been incredibly motivated, both based on the physical and mental burden this disease presents for these patients. This all changed really over the last few years, as the antibody teprotumumab, which targets the IGF-1R, which had been an interesting target in oncology some years ago. There were a number of anti-IGF-1R antibodies entered into the clinic, including teprotumumab, first by Roche. And then when the initial randomized controlled trials for IGF-1R antibodies failed to meet efficacy criteria, a lot of these antibodies were discontinued. So teprotumumab was then repurposed for thyroid eye disease, first by River Vision Corporation, which showed some really compelling Phase II data acquired by Horizon Therapeutics. I think as many people know, we then ran a Phase III in about 18 months, resulting in the approval of TEPEZZA just a little over a year ago and has really transformed this landscape and made a tremendous difference in patients' lives. The commercial launch has been tremendous, so really a lot of credit to Horizon. And I think it underscores how strong unmet need is here where the sales, I think, really surprised a lot of people how quickly, particularly during COVID, patients were enrolled and treated with TEPEZZA. And so we're looking here at a patient population again about 15,000 to 20,000 patients per year in terms of incidents that acute or active stage disease, maybe around 70,000 inactive or chronic thyroid eye disease patients. TEPEZZA itself is quite expensive. Wholesale over $300,000 per course. It's a 6-month course of treatment. But the net is $200,000 or so. And so now we're looking at a market that's going to remain branded at least until 2032, possibly longer depending on how some pending method of use coins pan out. And this is a single, very important product. But we think there's opportunity to achieve more. That's underscored in our minds. We've seen TEPEZZA supply interrupted as the manufacturer was repurposed for COVID vaccines. So this, again, just reiterates to us that there really needs to be more than one product in this category for these patients. Just to spend a moment on the Phase III data for teprotumumab, which really confirmed the Phase II findings and validated that IGF-1R blockade is transformative mechanism of action for these patients. So the data here is from a randomized double-masked trial, placebo-controlled, relatively small group size, 40 patients per arm, a nice objective endpoint and a huge signal. So in terms of presenting a reproducible clinical and regulatory pathway, this is very attractive. What's interesting to us is the dosing paradigm, 10 mg/kg followed by 20 mg/kg every 3 weeks for a total treatment course of 24 weeks. And as an IV infusion, requiring patients to find their way to an infusion center, that does present a barrier to access. And so we look at this and recognize that teprotumumab was never dose ranged. This was the only dosing paradigm that was ever evaluated. We would like to bring forward additional molecules into this space and try to optimize how patients can be treated and come up with better products to satisfy what we see as remaining unmet need in the space. So our approach in thyroid eye disease is really to approach this from several angles. We set for ourselves 3 goals here. The first is that we would like to get to clinic and get to market as fast as we can. We fully believe there will be more than one anti-IGF-1R antibody on the market. And so we have licensed an antibody that has previously been in development. I'll spend some time talking about the antibody. We see that as the fastest way for us to move a molecule forward. Second goal, we would like to come forward with a next-generation antibody, both teprotumumab and VRDN-001, our older antibodies. They have a lot of great things about them, but we've learned a lot about antibody engineering. And so we've built in some of the lessons of the last few decades into VRDN-001 into an antibody that we think can hopefully markedly improve dosing paradigm. In this case, moving from IV infusion to a convenient subcutaneous injection. And we see that as a potential way of expanding the market by giving patients another point of care moving from an IV infusion center to additional sites of treatment. The third goal recognizing that this is despite the very robust data showing how much IGF-1R inhibition can help patients, the field is early. We think that with VRDN-002, we may have a durable best-in-class product with this mechanism. But we may learn something that tells us there's something else we can do. And if one of our products is going to be made obsolete, we sure would like to be the group to do it. So we're working on some ideas that we're quite excited about, but I think it's premature to disclose what may be something even better. So we are pursuing all these in parallel because now the biology has been elucidated to an extent where we feel there's not as much biology or technology risk here. We can really invest in these product-oriented hypotheses, trying to come up with some medicines that are really going to matter to patients and to the market. So I'll spend a minute talking about VRDN-001. Again, this is an antibody we've licensed from ImmunoGen, have been called AVE1642, and there's a lot we like about this antibody. We looked at the 8 selective IGF-1R antibodies that have moved into the clinic and it's then given to oncology patients. This one really rose to the top of our list for a variety of reasons. First, the molecular mechanistic data suggests very similar mode of action to teprotumumab. So as we see in epitope bin, it binds competitively to the receptor with respect to tepro. And it has same patterns and molecular pharmacology, for example, blocking IGF-1R phosphorylation. And it has quite high receptor affinity actually based on the published data of higher affinity than teprotumumab for the receptor. This has been through 3-month nonhuman primate tox. It's already been in over 100 oncology patients with some quite robust PK and PD data as well as, for example, Sanofi looked for antidrug antibodies and did not find any patients who received this antibody. So a lot of things have been derisked about this antibody. So we licensed the antibody from ImmunoGen, and we are currently manufacturing new clinical supply. So we completed the license in October. We're making new drug substance to drug product with the goal of an IND file third quarter this year. And I should point out, I think, as many know, demand for manufacturing has gone up. In the last year, there have been a number of supply constraints. We have invested in some redundancies in our manufacturing plan. So should we have a COVID-related issue befall us, hopefully, we've invested in the right redundancies that we don't suffer any major setbacks. So I feel good about our approach there. The goal here is to get this to the clinic as quickly as possible and generate some patient data. I'll come back to our initial thinking for clinical trials in a moment. To think a bit more about how VRDN-001 and tepro compare. These are both IgG1s. They both are very typical half lives, if we look at the oncology trial data for an IgG1, about 10-day half-life. They both cause IGF-1 increase. I don't want to make a quantitative comparison, but qualitatively, these both cause IGF-1 to go up. That's important because it's an indicator of IGF-1R blockade. So it tells us the target has been engaged, and it's antagonizing the receptor, again consistent with the shared mechanism of action. The affinity, as I mentioned, is actually higher, VRDN-001 or subnanomolar, which is where we really love to be with an antibody compared to the published data for teprotumumab around 5 nanomolar. In terms of safety and tolerability, these are both antibodies are highly selective. And looking back at the oncology trials, the only thing that stands out is hyperglycemia, which is very much a class effect. So our baseline assumption is that we'll have the same safety and tolerability profile of teprotumumab. I should note that the whole -- the reason one dose ranges is that sometimes you can lower the dose of therapeutic candidate, keep the efficacy and improve the adverse effects. We have no data suggesting that, that could happen. It's just underscores again by developing this to include dose ranging, we may be able to find an optimized dosing paradigm for our molecule. I would like to spend another minute on IGF-1 levels because this biomarker data suggests that we may have an opportunity to improve on dosing with VRDN-001. So what we're looking at on this slide is one of the Sanofi-sponsored oncology trials, evaluating doses from 3 mg/kg on the upper left all the way up to 24 mg/kg on the bottom right. Remember tepro is given a 20 mg/kg for the majority of the treatment course. In each panel, what you see after dosing has commenced, the black symbols Show IGF-1 rapidly increasing. That's what you'd expect to happen if the IGF-1 receptor is being blocked. The open circles are IGFBP-3 as a carrier protein that's supposed to move in parallel with IGF-1 as it does. And then the open triangles are IGF-2, which should not really change much if IGFR is being blocked. So this pattern is completely consistent with blockade of IGF-1R. What's interesting is that we do not see any evidence of a dose response here. Even at the lowest dose of 3 mg/kg, it looks like we're seeing a maximal signal. So I can't draw a link between IGF-1 levels and pathophysiology we're targeting, but it does highlight our interest in evaluating lower doses and seeing where can we -- what's the lowest dose that might deliver tepro like efficacy. That then opens up opportunities for us to think about optimizing the dosing paradigm. So our goals now, and this is all pending FDA feedback. And I should mention that Barrett Katz, neuro-ophthalmologist, joined us as Chief Medical Officer in late January. And so he's hard at work optimizing our clinical plan designs. But our goals and our initial thinking here, we really would like to get to the clinic as fast as we can to fully dose range versus placebo. That's going to inform an optimized dosing paradigm. And of course, is critical for moving forward into registrational studies. We are thinking about the least risky way of developing this. That would mean we focus on the same patient population that was enrolled in the teprotumumab program, so that active disease. And the doses we'll choose are highly informed by the existing PK/PD and safety and tolerability data from the old oncology trials. We do plan to include some lower doses based on the IGF-1R biomarker data I just discussed. And I should point out that even though this program is intended to be IV, if we get efficacy at levels of 3 mg/kg or lower, that might support formulation for a self-administered subcu injection, not the kind of large volume subcu infusion, but small in volume that it can truly be an injection, which again can open up the signs of care, which we think would be important for this market. In terms of the endpoints, we have a nice path to follow. The primary endpoint of the tepro use is probably a nice precedent. We are considering looking at some earlier endpoints in addition to the 24-week endpoint that teprotumumab was evaluated with. Most of the benefit is observed within 12 weeks. So we're exploring the potential to look at 12-week endpoints. And then, of course, secondary endpoints are an opportunity to really build the product profile and learn more about the molecule and how it may help patients and physicians. So we're very excited to move that forward. But we are maybe equally as excited about VRDN-002. So this is our own molecule that's really designed to be a next-generation antibody. And so for this, we focus on the dosing paradigm for TEPEZZA. Again, we think about what 20 mg/kg means every 3 weeks. That's about 500 mg per week. Not a lot of antibody. There are no current commercial subcu injection products at this dose. And when we think about what does it take to get to subcu injection, we think about 300 milligrams as a benchmark. We can point to Takhzyro for HAE and Dupixent for atopic dermatitis, both of which were 300 milligrams and 2 mills. And so if we can get to that dose or lower, lower the dose, the smaller the volume, the smaller the needle, more convenient that product would be for patients, we think the better the product could be. And so in VRDN-002, we've really focused on 3 different parameters to help minimize the dose and volume that's required. First, we have high affinity. We've targeted the same epitope bin as VRDN-001 and tepro. So -- and it shares all the same molecular pharmacology and that high affinity might help lower dose that's required for efficacy. Secondly, we've evaluated a panel of biophysical characteristics to make sure that we've picked an antibody that has a good likelihood of formulation to high concentration but low viscosity, again, that should help us get to a lower volume. And finally, we'd like to lower clearance to reduce the cumulative dose that's required. The most robust way to do that is to leverage Fc modification that can extend half-life and can substantially reduce the dose that's required to maintain a given target exposure. And so for that, we have exclusive target exclusive rights to the Xencor Xtend technology, same technology that Alexion used and the Soliris follow-on Ultomiris. And so it combines the Fc modifications, good biophysical characteristics and high affinity into VRDN-002 into what we think could be a durable best-in-class product by minimizing the volume that patients need to receive to get to that really wonderful tepro like efficacy. So with that, I'll just quickly show our team here, I mentioned Barrett Katz, our Chief Medical Officer, joined recently; Jason Leverone, our Chief Financial Officer, who had been with miRagen; and then Vahe Bedian, our Chief Scientist who I've been working with for several years before joining Viridian. So really pleased to be working with this team. Very strong Board of Directors as well. And so even though we are, in many ways, a brand-new company. We're really excited about, I think what we might be able to achieve in the coming months and years. So just to summarize our cash runway and our milestones. At the time of the acquisition, our pro forma cash was $140 million and that was projected to last through the end of 2023. Really, it was designed to complete both Phase II studies for 001 and 002. I should point out that the transaction involved the issuance of a number of convertible preferred shares. And so right now, the way we think about our market cap is on an as-converted basis, where we would have 30.8 million common shares again on that as-converted basis. And so we're funded through a number of milestones here. We intend to move both 001 and 002 into the program and into the clinic and through Phase II trials. But 004, again, undisclosed target, undisclosed indication, but another example of a place where we see an opportunity to make a meaningful product without taking a lot of biology or technology risk. We hope to have an IND filed by the end of next year. And we intend to continue expanding the pipeline. We're evaluating a number of potential opportunities to select a VRDN-005 program later this year. So to close then, we are focused on what we think are attractive markets, starting with thyroid eye disease. We are choosing programs that are really designed to mitigate risk but offer the potential to deliver best-in-class products. And we're well funded to move through some very important clinical data. Well, in parallel, we build out our pipeline for the future. So I'll pause here and happy to answer any questions.

Thank you so much, Jonathan, and apologies for the technical issue earlier. So I guess before we open it up to any questions in the queue, maybe we can start with a couple. I guess, first, definitely, you have a very potent molecule in your hand. Do you anticipate that you would have to run a trial against an active arm rather than placebo?

Our expectations currently are that the placebo-controlled trial will be adequate and tell us what we need to know as is common in rare diseases.

Got it. Makes a lot of sense. And then are there any IP issues given Horizon's methods, patterns?

No. So we did a careful frame to operate analysis and are comfortable that we will have that deal.

That is great. And let me just check the queue for any additional questions. It looks like there's no additional questions. So once again, thank you so much for accepting our invitation to present at our conference. It was great to hear the deal we're doing. We're really looking forward to or seeing some very exciting data.

Great. Thanks again. Thanks for having us.

Thank you.