X4 Pharmaceuticals, Inc. (XFOR) Earnings Call Transcript & Summary

It's very nice to be here. Thank you very much for coming to learn about X4, and thank you, Na, for the introduction. If we could go on to the next slide, please. Just as a reminder, I'll be making forward-looking statements as part of this presentation. We encourage you to review the full form of disclosures via our 10-Q that was filed back in May. And if we now move on to the next slide. Just to give you a bit of an overview, X4 is a biotech company located in Cambridge, Mass, and we are absolutely committed to patient care, delivering new medicines that can have profound impacts for patients with rare diseases of the immune system. And we'll really be focusing on the presentation today on some of our lead programs to help you better appreciate our probability for helping these types of patients. So if you move on to the next slide, please. So a little bit about the company. As I mentioned, we are based in Cambridge, Mass, and we're one of the leading companies in the world focusing on this unique target and pathway called CXCR4. In the audience today, we have our Chief Scientific Officer who's been in this field of over 25 years and developed commercialized compounds against this target. Our lead compound, mavorixafor, is first-in-class and it's oral once daily. And currently, we're in a global registration trial that would support full approval in unique disease called WHIM syndrome, and we have 2 additional indications beyond this, 2 Phase Ib proof-of-concept studies, which I'll come back to later in the presentation. I hope that you get to know X4 that you can appreciate that, together, we are a leadership team that really does understand the rare disease model. We understand how to deliver innovative medicines for patients and to do this in a global commercial fashion. So if we move on to the next slide, please. A little bit more about our leadership team. We hail from very successful companies such as Biogen, Alexion, Genzyme, AnorMED. All of these companies have delivered unique molecules that were first in class that created unique opportunities for improved patient care. And just a few folks to shout out, along the slide. Our Board Director and Chair, Mike Wyzga, was the Chief Financial Officer of Genzyme and has been with the company for many years as an adviser. And certainly, the esteem team that you see beyond is myself, our folks that have been involved with the commercialization of programs for SMA as well as for other rare diseases. So hopefully, you'll start to believe in a team that's ready to deliver on the next-generation of growth for rare disease companies, such as X4. So if you move on to the next slide, please. A little bit about the target. Why do we feel so confident as a company focusing on this area of biology? Well, the reason is it's a very well-validated target with human biology and with drugs that are currently commercialized against it. The target is called CXCR4, and it's a chemokine receptor that's well established as a main driver of immune cell trafficking in normal immune health. The challenges that certain diseases actually create mutations on this receptor, there are mutations that cause the receptor to turn on. And our approach is an oral once-daily treatment that can blunt that effect. So our 2 lead indications are, first, our global Phase III trial is WHIM syndrome, and the second indication is a rare form of lymphoma. Both of these types of diseases are driven by gain-of-function mutations or genetic mutations and allows our targeted treatment to potentially benefit these patients. We have the opportunity to expand beyond these particular indications into broader diseases and labels, and we also have 2 preclinical programs, 002 and 003, that are next-generation molecules that can help us expand beyond mavorixafor's current footprint into new disease areas. So if you move on to the next slide, please. A little bit about the drug. So in some ways, it's very straightforward, which I think speaks to its high probability of success. It's an oral once-a-day small molecule with a 22-hour half-life. It is highly specific and highly selective to CXCR4, and we know this through many, many years of both in vitro and human experience. And to date, the molecule has been in nearly 200 patients. So we have a very sound understanding of the safety profile, which supports chronic life on use. Importantly, the FDA recently gave us breakthrough therapy designation for the treatment of WHIM syndrome. And the thing I'd like to highlight there is the FDA more infrequently gives breakthrough therapy designation to non-cancer indications, such as immunodeficiencies or rare diseases. And what they need to see is belief that the Phase II data are compelling and that it could actually deliver clinical benefit to patients and that the patients have an unmet need. So we are extremely pleased with the FDA's granting our breakthrough therapy designation for mavorixafor in WHIM. And then when we think about exclusivities to support the long-term commercial growth of the product, in the event it's approved, we have orphan drug status, both in U.S. and Europe, and we also have composition of matter patents in the U.S. that are granted that will protect the product through 2038. So now we can move on to slide -- the next slide, please. A quick snapshot of our pipeline. As I highlighted again, we have our Phase III registration study ongoing. The next 2 light blue bars below that highlight our 2 proof-of-concept studies that are ongoing and these additional unique indications. We do have an ongoing Phase IIa trial, which is the subject of a clinical collaboration with Pfizer. And finally, for our next stage of growth, we have 002, which is a rare -- a brain-penetrant form of CXCR4 antagonist to treat rare brain cancers, such as glioblastoma; and 003 program, which is a next-generation molecule that can further broaden the footprint of mavorixafor treatment. So now let's move into the targeted indications that we're initially going after by next slide, please. There are 2 indications that we're focusing on, our diseases driven by CXCR4 mutations. So if we move on to the next slide, I'll introduce you to WHIM syndrome. So WHIM syndrome is a rare form of immunodeficiency, which basically means patients are born with dysfunctional immune systems. They can't fight infections the same way you or I can. And the reason behind this immunodeficiency is that they have -- are born with mutations and CXCR4. Now WHIM stands for Warts, Hypogammaglobulinemia, Infections and Myelokathexis. And while that's a huge mouthful, and I'll come back to that in the next slide or 2, a little bit more about where do these patients come from and what is their available treatment. Well, today in the U.S., we're estimating that there are over 3,500 confirmed and potentially underdiagnosed WHIM patients in the U.S., and unfortunately, they do not have any treatments that can support their lifelong battle of this disease. They're treated symptomatically with antibiotics or G-CSF or sometimes immunoglobulins. But unfortunately, today, there is no targeted treatment that really gets at the underpinnings of the disease. Actually, this is a wonderful opportunity for mavorixafor, given it can blunt the effects of these gain-of-function mutations in these patients. So if we move on to the next slide, please. So what is WHIM syndrome? What are the unmet needs in these patients? Well, we've been defining this to try to help appreciate the problems as a 3-legged stool. The first problem of these patients are that they have critically low white blood cell counts. Their white blood cell counts are orders of magnitude lower than you or I, it's because their white blood cells are stuck in the bone marrow or the myelokathexis or M in WHIM syndrome. And by being immobilized, these patients are then immunosuppressed. The second leg of the stool is the fact that these patients are subject to severe bacterial infections that can affect any organ system in the body. So for example, they get chronic respiratory infections, which lead to loss of lung function and bronchiectasis. They get chronic ear infections leading to hearing loss. There's examples of cellulitis and life-threatening sepsis and meningitis. So these bacterial infections are severe and the second problem in this 3-legged stool. The third problem that these patients experience throughout their lives is their inability to clear the HPV virus and then all the sequelae of that. They get disfiguring and recalcitrant warts. We have stories of people having shoe sizes almost 3 to 4x larger than their actual foot because of the amounts of warts that build up over years. And importantly, these patients are also at very high-risk of HPV-associated cancers. So the 3 legs of the problematic stool of WHIM syndrome are low white blood cell counts, severe bacterial infections and HPV-associated disease. And I hope as you learn through this presentation, mavorixafor is showing compelling evidence to support we're addressing all components of this disease. If you move on to the next slide, we'll begin to talk about the Phase II trial and then the data thereafter. So we've completed a Phase II dose-escalating trial, and then we continued on with open-label expansion opportunities to keep our patients on chronic treatment. The left-hand side of this slide is relatively detailed in terms of the inclusion criteria and what we are examining. But really, the take-on messages here are the patients that entered our trial were profoundly low in their white blood cell counts, particularly in a white blood cell called neutrophils or neutropenia. And so what we are specifically focusing on in the Phase II is how do we get their neutrophils above a predefined threshold. This predefined threshold and criteria or metric was agreed upon by the FDA and the European health authorities as a relevant primary end point for the Phase III. So what I want to help you walk through is that we are using this metric, not only because it's helpful in understanding what the patient's neutrophil counts are doing but that it will help you appreciate the probability of success for the Phase III trial design. So a little bit about the metric. The metric is called time above threshold and when patients effectively walk around with their neutrophil counts well below a threshold of 500. So they effectively have a 0 for this particular metric. And best case scenario, you can get a 24 hours out of 24 hours. So we believe mavorixafor is going to elevate these neutrophils out of this danger zone, above its particular threshold and hopefully, have a win on the time above threshold neutrophil count metric. So if we now move on to the Phase II open-label extension data. This will help you appreciate where we got to in dose escalation and also how we selected our Phase III dose. So we've completed -- successfully completed the trial, and these were the data that the FDA reviewed for breakthrough therapy designation. If you look on the left-hand side of the slide, these are the different doses that we explored in WHIM patients with the black line being a 300 milligram, one of our higher doses; and the red line being the 400. And you can see that, on average, most patients have neutrophil counts above that threshold very nicely for the 24-hour period. And in fact, as we looked at the averages of these time above threshold neutrophil counts, we were well above the 12-hour on average time above threshold end point versus, effectively, these patients are walking in with a 0 time above threshold. So we are multiples -- many, many multiples, above what these patients baselines exist at. And then in terms of dose selection, 300 and 400, you can see at the right-hand side that the 400 dose not only mobilizes neutrophils but total white blood cell counts, which we believe will last -- have a positive lasting impact on their overall immune health. So very solid data on the time above threshold, multiples above what we needed to see, and then 400 milligrams is the selected Phase III dose. So that's the first leg of the stool. Now let's look at the data that support benefit in the second 2 legs of the stool. The middle leg is about bacterial infections, severe infections that chronically impact these patients' lives. And in the open-label extension, we were extremely pleased to see over 50% reductions in patients' infection rates versus baseline or compared to what their baselines were entering the study. And the graph that I most appreciate is, actually, I'm not -- hopefully, everybody can see the lower part of the slide, I'll try to move this in case you can't. But the very lower part of the slide shows the deepening reductions in infection rates over time. That's incredibly important. And what we're hopefully seeing there is that the immune system is being trained to recognize infections and actually fight them before they get clinically presented. So we're extremely pleased with that long-term outcome data, supporting that improvement on that second leg of the stool. And finally, the third leg of the stool is that wart burden that's associated with the HPV virus. We found with our patients that did have warts entering the study, there were over 75% reductions in those warts throughout the course of treatment. And in particular, this one patient, hands shown here, she had the most burdensome overload of warts on her hands. They've almost completely regressed over these 18 months of treatment. So 1, 2 and 3, our drug is showing improved neutrophil counts and improved white blood cell counts, decreases in bacterial infections and decrease in wart burden. So we're extremely pleased with the totality of the data from the Phase II. That really nicely segues to the next slide, please, which is the design of our Phase III trial. As I mentioned, the Phase II really informs the Phase III and helps us set ourselves up for the best possible chance of success. The primary end point is that time above threshold where we've shown 4 to 5x higher than baseline, which all these patients are enjoying at 0. So it's a nice benchmark for us to think about treatment versus placebo. The secondary end points are reductions in infection rates and reduction in work burden. We're starting with that 400-milligram dose that we have the most robust data behind, and we're currently planning on enrolling subjects 12 years and above, and that trial is already ongoing globally and enrolling patients. And top line data from this trial is a 1-year dosing study, well, is expected into 2022. That's our WHIM syndrome story. Again, excited about where we're at with this global registration trial to support full approval. But the story does not end there. If we can move on to the next slide. We are also investigating the drug in a rare form of lymphoma called Waldenström's. And interestingly, the patient population is much larger at this point than WHIM with over 13,000 in the 2 major markets. Current standard of care has done [Technical Difficulty] some of these patients. But unfortunately, for some patients, they actually get a second mutation in CXCR4 which causes a resistance to standard of care. So there's a population of about 1/3 of Waldenström's patients, which have a genetic driver from the CXCR4 DNA function that leads to core responses. And so if we move on to the next slide, you'll appreciate a little bit more about where that unmet need is. The metric for success in Waldenström's patients is something called a VGPR, which stands for a very good partial response. And for the patients who unfortunately have the CXCR4 mutation, only about 1 in 10 patients get a VGPR or this robust response to current standard of care versus about 50% for those who have your classic profile. This is a problem for these patients. And unfortunately, none of the BTK inhibitors that are currently standard of care are helping these patients. So we believe that by dropping in a CXCR4 antagonist that we will shift those patients with poor response to look much closer to those patients that are getting a more robust response. Now what is the definition or what is the underlying metric of response? In Waldenström's, the disease is driven by B cells. They are a type of immune cell, and they overproduce IgM. This graph on the right-hand side shows what kind of good response look like compared to weak responses. So the bar graph on the left shows very strong responses, an IgM level drop, and that corresponds to cancer load drop, and you can get about 80% to 90% reduction. Unfortunately, for the WHIM mutation patients, they get a core response, only a 50% reduction, and it happens very slowly over time. So this is the metric that we're actually looking at in our Phase Ib study as IgM level drops. So if you move on to the next slide. We currently have an ongoing Phase Ib study in these Waldenström's patients with the remaining unmet needs driven by CXCR4 mutations. The Phase Ib is a dose escalation study. So we'll certainly be examining safety and pharmacologic effect. But importantly, even in the Phase Ib, which is an open-label, we'll be able to look at CRM IgM level changes. And our ideal is to see sharp, steep drops in IgM, similar to what we know good looks like, which is what patients who are responders and don't have the mutations look like. So we expect data from this Phase Ib trial in the second half of 2020. And just to give a highlight to one of our close clinical or close collaborators and certainly a major player for patients across the world, Leukemia and Lymphoma Society is an investor in X4. They've been very close partners to help us best network with the world leaders in this particular space and the top people in the Waldenström's community are part of our Phase Ib study as we look to find proof-of-concept with this initial 12- to 18-patient study. So again, we're excited about WHIM and Waldenström's because of these genetic mutations as drivers, and we have a drug that modulates that. But again, the story doesn't stop even there. So let's move on to the next slide. There are opportunities for label expansion into other indications that also collapse this pathway. So if we move on to the next slide. The first one is called -- a disease called severe congenital neutropenia. Now the genetics of this disease is a little less well understood. But what we do know clinically is they're very similar to WHIM patients. They have profoundly low neutrophil counts. They get chronic lifelong infections that are oftentimes life threatening. And the prevalence is also rare, somewhere between the 2,000 and 3,000 mark for a major market. Now interestingly, there are some subgenetic types of SCN, but our ideal is to really understand what's the distribution of genetic defects in these patients and then how do those genetic defects overlap with the CXCR4 signaling pathway. So if we move on to the next slide. This is the translational study that we have ongoing which will help us better understand which genetic subtypes of severe congenital neutropenia could benefit from mavorixafor. So this is a Phase Ib study where we're examining about 40 -- approximately 40 to 45 SCN patients. And as part of their entry criteria, we'll genetically screen them about -- against a panel of about 200 genes to best understand which immunodeficiency pathway these patients are -- these patients' diseases are linked to. After their genetic screen, we'll take a baseline of their neutrophil counts kind of very similar to the measurements we showed you in WHIM syndrome. We'll dose them for up to 2 weeks, and then we'll invite them back in for a final assessment of their neutrophil counts again with those dense 24-hour assessments. The combined data set coming out of this trial will allow us to correlate patients who get profound responses and neutrophil elevations with mavorixafor with the genetic underpinnings of their disease. And we think that data set will be very valuable to us as we begin to discuss with the FDA how we could best advance this particular indication and potentially expand the label beyond WHIM syndrome in the event that's approved. These particular patients are also seen by the same clinicians who manage WHIM patients. So as we go forward and become a commercial organization, we feel like this is a very nice leverage point to work with the physicians to support their broader groups and patient population. So now we can move on to the next slide. A little bit of a large snapshot about our 3 trials, our 3 shots on goal and where we believe the potential benefit of this drug is for a number of patients. So certainly, with WHIM syndrome, we're predicting over 3,500 in the U.S. today, both diagnosed and undiagnosed, another 4,000 to 5,000 on Waldenström's in major markets as well as 2,000 to 3,000 with severe congenital neutropenia. So we have a nice leveraged approach, very targeted patient populations that we're certainly in a good position to take through ourselves all the way through registration and globally commercialize ourselves. So if you move on to the next slide. So we're really excited about mavorixafor as a broad opportunity to help multiple patient populations and always links back to genetics. So today, we already have an ongoing collaboration with a company called Invitae that provides genetic testing commercially. We have collaborated with them to provide free genetic testing for clinicians and their patients to better enable them to understand the underpinnings of their disease, build education and awareness, and also build an appreciation for any patients who could either come into our trials or benefit long term once the drug may be approved. Those patient populations know what could potentially help them. We're partnering with patient foundations, as I mentioned, the LLS, the Jeffrey Modell Foundation, the Immune Deficiency Foundation, a number of other registries to continue to build on what they've already understood and invested in for many years and leverage that and hopefully expand the understanding of where mavorixafor could potentially benefit. If we move on to the next slide, we'll go actually one slide back, please. Just a quick highlight and shout-out for our milestones over the next 6 to 12 months or so. We have a Waldenström's data readout by the second half of this year, 2021 is our SCN Phase Ib trial results and then 2022 is our top line and our global Phase III to support full registration. And finally, on the last slide, we have $117 million in capital. So we feel very well capitalized. That will take us into 2022. We do have 2 different classes of shares that are outstanding in terms of warrants, our Class B and Class A. And finally, I'd just like to highlight the strong analyst base that continues to appreciate the X4 story and provide additional insights into the innovation that X4 may be able to deliver throughout the world for our patients. So I'd be happy to answer any questions. I know we only have about a half a minute left, but thank you very much for your attention.

Looks like you don't have any questions. But from our end, I have a question. Given that WHIM syndrome is caused by a single gene mutation, how do we think about the potential competitive market -- competitive landscape, especially in regards to modalities, such as gene therapy?

Sure. It's a great question. So gene therapy is typically used when you're missing a gene and you want to reinsert it. The WHIM syndrome is caused by an autosomal dominance mutation, CXCR4. So as long as that mutation is there, unfortunately, those patients will have the disease. The idea around CRISPR is possible. I think CRISPR technology is much further away and other questions around oligos or antisense. That modality won't work as the gene mutations are actually truncations, and there really is no difference between the wild-type and untruncated versions of the CXCR4 receptor in mutated states.

Thank you very much.

Yes. Thank you, Na. I appreciate the question, and thanks, everyone, again.