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

All right. We'll get started. Good morning. Thanks, everyone, for tuning into the B. Riley Virtual Oncology Conference. This is Mayank Mamtani, Senior Biotech Analyst at the firm. Our next presenting company is X4 Pharmaceuticals. It's my pleasure to welcome the team here, Paula Ragan, CEO and President; Adam Mostafa, CFO; Art Taveras, Chief Scientific Officer; and Diego Cadavid, Chief Medical Officer. Before we get into the exciting fireside chat, I'd like to remind everyone that you can submit questions by clicking the ask a question icon on your screen, and I can ask them for your behalf. With that out of the way, thanks, team, for joining us and discussing some of the exciting work. And honestly, an exciting 2021 ahead for you. So maybe I hand over the floor to you, Paula, to sort of talk about the CXCR4 platform as a whole and maybe also touch on the company broadly for folks who might be new to the story.

Great. Thank you so much, Mayank. We appreciate the opportunity to be part of the B. Riley Oncology Day today. And I'm really happy to talk to you about X4 Pharmaceuticals, which is a public Boston-based company focused on delivering targeted treatments for rare diseases of the immune system, including primary immunodeficiencies and some rare blood cancer, which will be more of the focus of today. So regarding the development of our lead product candidate, mavorixafor, we're targeting a genetically defined subpopulation of patients with Waldenström’s macroglobulinemia, which is a rare form of non-Hodgkin's lymphoma. These are patients with high unmet need. You'll hear it later today from our CMO, and we're there with something that could be quite meaningful for them. Initial data from this Phase Ib study will read out the first half of this year, which is why the excitement is mounting from us to be able to communicate, and we're also looking at additional trials. So later this year, we'll have a Phase Ib readout in another severe congenital neutropenia disease. And then we do have an ongoing Phase III study in a rare genetic disease called WHIM syndrome, which is a primary immunodeficiency. So you can see a lot of excitement building throughout the next 1 to 2 years for the company.

That's good. And maybe I think it's a good segue into diving deeper into the CXCR4 science, immune cell trafficking. And I really open it up to maybe Art wants to take a first stab at it, kind of just laying out the work that has happened on the scientific community, including some of industry peers and sort of, maybe then we can get into the specific indications.

Sure. Happy to do that. And hello, everyone. So CXCR4 is actually very important. And when it comes to adhesion and homing and so obviously, when in our trials when we're thinking about Waldenström’s, we're thinking about, in particular, B-cell adhesion to stroma and then some of the drivers there that are continuing and perpetuating signaling and then the proliferation leading to the cancers there. And so CXCR4 itself is a GPCR. And through the action of CXCL12, there's continuous signaling and then that normally would get down regulated. But when it comes to some of these diseases, actually, there's an over expression or an up-regulation of CXCR4 and there are mutations in CXCR4, which are very important here. So for Waldenström’s, this is a genetically validated driver of the disease -- of the population of this disease and being able to inhibit the signal and to remove or mobilize cells away from the stroma, where a lot of the communication that's happening is really critical. And so we -- there's a lot of information out there in the literature. We generated quite a bit of data, and our work in our research and clinical programs actually are supportive of the mechanism. The tumor microenvironment is actually very important because it isn't just so much that you're sitting at the strong or the microenvironment, but also there's signaling communication between other cells. And that's where other lymphocytes become important for T cells, the communication between macrophages and also the ligands that bind to CXCR4, which is driven by produced in the stroma, continue to perpetuate that signal. So very important actually to get the cells off of the bone marrow into the periphery and in Waldenström's has obviously been able to kill up. So the communication between them is very important. While we focus in on targeted therapy approach here for Waldenström's, there is a huge opportunity. Obviously, in other lymphomas, certainly in solid cancers, so solid tumors, where caps have also upregulated CXCR4 expression. And so we have, for sure, plenty of opportunity across in IO and also a solid tumor platform.

That's very helpful. And maybe a very natural segue into maybe bringing in Diego on the Waldenström’s Phase II study that you have ongoing, excuse me, Phase I/II, is that right? And could you maybe talk through the details of that study and believe the interim analysis that you're working towards at some point this year, Diego?

Yes. Thank you for the question. Its stories are currently running a Phase Ib study in Waldenström’s macroglobulinemia. The specific goal of the study is to investigate whether treating patients who have double mutations, not only the MYD88 mutation that's highly prevalent in Waldenström, but also in addition, a gain of function mutation on CXCR4. These patients tend to have a more severe disease with higher IGM levels, a more affected bone marrow. They tend to be more refractory to treatments, including with BTK inhibitors. And therefore, we believe that by adding mavorixafor to a BTK inhibitor, we could be able to better treat this double mutant population. So we are doing that in a study that's currently enrolling. It is doing a dose escalation within patients first to us as the sale of the concomitant treatment with ibrutinib. The plan is to dose escalate as high as 600-milligram safety. We are measuring the changes from baseline in IGM levels in plasma, which is a very good biomarker of disease, but also response to treatment, and we are periodically looking at the safety data as well as the changes in IGM. The total will be about 18 patients, and we will follow them for long enough time to also begin to appreciate not only the safety of the concomitant treatment, but the potential to provide a treatment for this double mutant population, which is an area of high unmet need.

And maybe if you could touch on that unmet need part and maybe talk about the double mutant data set that we have from current existing standard of care and sort of kind of help us understand what the patient pool is out there and how that might be evolving with, obviously, some of the single mutant being well managed with ibrutinib. Like could you just sort of talk a little bit about the evolution also of that mutation and the nature of that mutation and how big that is? And maybe, Diego, you can start and then we can bring back Paula into the conversation.

Yes. No, the standard of care has a rapidly improving Waldenström from the early days of using, basically, chemotherapy to bringing in the anti-CD20 antibodies. But definitely, in the last few years since the first BTK inhibitors were introduced, there has been really a remarkable improvement in the treatment of Waldenström. However, it's been a consistent finding that the patients who have the double mutation are the ones who do not respond well. And that's the interest of X4 to see if we can further improve on the standard of care by identifying this population from the very beginning and giving them not only the BTK inhibitor, but potentially our compound of X4 and get a really good clinical response. So this ongoing study will give us early necessary information on the potential so we can move into a larger study hopefully and see if we can confirm the benefit in this double mutant population.

Yes. And maybe I'll just dovetail onto this kind of the strategic importance of the Phase Ib. I think CXCR4 has always been an interest -- a high interest target in lymphomas and even broadening out to leukemia as sort of Art was initially indicating. So we're excited about this initial trial as validating the target, obviously, in a very sort of a unique population with the mutation, but the CXCR4 over signaling a lot of these leukemias and lymphomas is well documented. So it's an interesting point for us to consider obviously the fast market path focusing on Waldenström’s through registration, but it will also provide some insights about how can go potentially even broader and really capitalize on a drug that is -- has a very reasonable safety profile so far, which is unique in oncology, as I'm sure you can and then see what other patient populations could benefit.

Yes. And maybe if I can push a little bit on what would success look like for you. And I think you mentioned that a good number of patients here will be on the highest dose as you think about the data set. So can you maybe talk to what sort of IGM levels would be sort of your expectation where you feel comfortable that it's worth taking that next step? And maybe also touch on the AE profile, like with ibrutinib, obviously, there are -- it's not -- it's a good drug. But as we have learned more about the BTKs, there are a certain patient population that just cannot -- it's just not the right thing to put them on BTK. So maybe also touch on the learnings that you may have had on the safety of mavorixafor support over not just the Waldenström exposure, but just overall You can take that question. Yes.

Maybe I'll start with sort of the bullet point summary, and then I'll ask Diego to jump in. But in terms of the efficacy benchmark, so as Diego highlighted, the extremely high IGM levels of these patients making them even sort of the most severe on the spectrum of Waldenström’s patients is really the first indicator we have to look for sort of hopefully, sharp drops near-term and IGM levels and that's certainly correlated to what clinicians want to see. So there's sort of the 6-month window of hopefully seeing a drop in kind of getting deep over time. The benchmarks in the short-term are trying to get patients to respond over a 50% drop on about 1 out of every 3 patients should get there with just ibrutinib. So we're certainly hoping to beat that. Long-term, as patients stay on study, it's about a doubling as patients get out to over a year on treatment. So it's that 1/3, 2/3 range, short and long, that we think we can beat. Hopefully, with mavorixafor, it's given a strong mechanistic rationale. And early, again, it's always about the IGM drop in these early studies. So maybe with that, I'll turn it over to Diego to dovetail, and I think some of the safety stories is the unsung hero of mavorixafor so he can add to that.

Yes. Thank you, Paula. Yes, mavorixafor has been tested in clinical development in several studies, including in early Phase I in healthy volume tiers. There were earlier studies in HIV population, and X4 has completed studies in solid tumors. We have ongoing studies in a rare primary inefficiency called WHIM syndrome and now in Waldenström. So overall, over 200 patients have been dosed. So pharma has a good safety profile, good tolerability. We believe it is really important when you are treating disease like Waldenström, which patients tend to have a long survival. They are sick and their ability to stay on this drug long-term will heavily be influenced by the safety profile, and mavorixafor so far is showing that. So we are encouraged.

That's great. And maybe staying with you, go obviously, there are other alternative approaches looking at the target, including antibodies and also being tested in Waldenström. So what is the data that we are aware of out there that just gives you comfort that the mechanism, the scientific rationale here is strong and it's already demonstrated in the clinic?

Yes. So we -- I think it's very well established by investigators over the last 5 years, that this gain of function mutations in CXCR4 create this particular subtype of this small refractory and more serious disease. So that is well-established. We also know that mavorixafor is a really good drug to correct that gain of function mutation. The current study will actually answer the question of what type of responses are we seeing when we combine mavorixafor, and we are way on our way to actually get to see that data. But overall, we can the preclinical data, our understanding of the biology of CXCR4, the established safety of this compound and the fact that we can readily identify patients with the 2 mutations and enroll them in our trials provides a strong rationale for pursuing this opportunity.

Paula, would you add to any competitive approaches that have been looked at and specifically in Waldenström’s that maybe providing additional evidence on the mechanism?

Yes. So I mean, one of the key investigators in our trial in a recognized KOL in the United States is actually the world is Dr. Steve at the Cancer Institute was actually his laboratory that identified CXCR4 as one of the alternate mutations in Waldenström’s and is a main driver for these very severe patients. So thankfully, we're collaborating with him. He's done some excellent work both sort of in-vitro as well as he's been exploring through an investigator sponsored study: A, CXCR4 antibody that's been discontinued from BMS, but it's an interesting tool of the study in the clinic. So he's been exploring that. I think the data he's seen and high level shared with us adds excitement around the potential of this drug and this mechanism in CXCR4 mutated Waldenström’s patients. At the end of the day, we're excited to come with an oral once-daily treatment that has a respectable safety profile, and we'll pair well with ibrutinib, which is also oral once daily.

Right. Okay. And just last question on Waldenström. So in terms of the next study that you'd be thinking about, what would be the scale of that? Again, I understand this is -- there's a path already established by current -- the BTKs that are approved there. But again, this is a slightly different population. So how -- what is the scale of that study you're looking at on the other side of the data?

Yes. I'll start, and then, I mean, at the end of the day, we have to generate the Phase Ib data, given it's a proof of concept. And it will help us understand the potential power and the potential endpoints that we're measuring. I think at the end of the day, we will need an effective comparator. These patients' progression is slow enough and standard of care can at least slow their disease. So I think at this point, that's as high level as we can share. We just have to wait for that Phase Ib data, see what our response rates look like and really use that to leverage. In regardless to studies in Waldenström’s, in general, are smaller, so I can speak to the zanubrutinib trial, which was a total of 200 patients. They range between 50 and about 200 patients depending on the aim of the study. But at the end of the day, sign our own to make sure we can figure out what's best for patients and help us answer the question.

Right. And I just got this follow-up. Maybe on the COVID-related impact, I think there were some interesting things you were doing in terms of ensuring that your enrollment tracks relative to plan. So could you just speak to any update on that? And also, how much follow-up you would have when you would present that data?

Yes. So I think maybe it will be a bit of a tag team. But on the COVID-related aspects of the study, we've tried to bring in-home health care or out-of-hospital health care, given the metrics for the study are blood draws. They're based on blood draws. So we do have the ability to support the patients and their needs around COVID, a bit more than classic studies where you have to go in for imaging, unfortunately. So that's one advantage of the lymphoma approach and assessment. And then in terms of -- and I apologize, I -- my onco -- what was the...

The follow-up, how much follow up, typically 3 to 6 months, is that kind of the follow-up you're talking about?

Yes. I think it depends on where in the first half will present, but it's a dose escalating study. So we are focused on scientific rationale to justify dose, and then we'll have longer-term outcomes towards the end of the year. So I think you can kind of think of the study appropriately is in a Part 1 and Part 2. Part 1 is always about safety and signal generation on and Part 2 will be the longer-term response rates.

Awesome, awesome. So obviously, you have 2 other indications, and I do want to leave some time for WHIM, which is your pivotal indication. But let's transition to SDN maybe next and maybe Diego, we can go back to you in describing the trial, the Phase I/II trial that you have running and sort of the outcomes that you're looking for?

Yes, thank you. Yes, from the -- earning at the time of the studies in healthy volume TMC, it became very clear that soon after taking mavorixafor, there is an increase in circulating numbers of and lymphocytes and monocytes regardless of whether there is a mutation or not. So this raises an intriguing possibility. There is a population of patients who are born with severe congenital neutropenias for very different reasons, others develop them from autoimmune. But regardless, this -- some of these patients are prompt to infections and the doctors tend to manage them with chronic injections of growth factors like G-CSF or give the mode off-label things trying to help. However, for us, having a once a day well-tolerated oral molecule that could potentially treat these is very attractive. So what we're doing right now is an early study to look at some of these patients who are already being treated with growth factors and giving them mavorixafor doing the sequencing to see if we can characterize what is the generic neutropenia or not known and then see if we can get more further mobilization of neutrophils on these patients. And if we observe that, then I think this would be sufficient to move into a next step where we can actually plan a study to do it over a longer-term and really see if these patients who are really doing subcu injections that were never developed with chronic treatments. As you know, these growth factors are only really approved to 3 chemo prevent severe neutropenia of chemotherapy. But for a chronic condition, it would be really much better to have a safe oral compound.

Right. And then maybe, Art, if you could comment on the mutations that are prevalent, this is a question that comes in, like how the sort of mutations that characterize SCN and some of the learnings you've had from the WHIM like mutations? And what are you now learning as you're trying to find these patients out there? Maybe Art, if you could comment on that, that would be great.

Yes. This is a great question, actually. And so some of the work that we've done is, obviously, when we do our genetic screening and we find out what the mutations are, some of them are known. And those are the typical R334x and the S338x. Those are kind of the more common wind type mutations. But there are a number that are actually not well established. So they considered variance of unknown significance. And what we've done and we've made cell lines that actually express these and then we analyze their signaling and the effects of mavorixafor on those. So this becomes really important because then we can determine the pathogenicity of these various mutations. And then as we continue to screen databases and then do some additional, very innovative ways of exploring the number of patients that are out there in all of these diseases, then we get a better understanding about where we are and what the opportunities are. But yes, we have a pretty good understanding and some of that stuff actually will be published coming up this year.

Right. And maybe this is a really good segue into WHIM syndrome. Maybe, Paula, just kind of summarize for us the data so far and some of the work you've done in -- from a patient identification standpoint. And obviously, maybe some of that is being helpful to your ongoing Phase III study. But then I feel like a lot of this SEN and WHIM syndrome work kind of goes hand-in-hand. And maybe just kind of talk more specific to WHIM syndrome, but also just the finding of these patients and not just for the trials, but also ultimately, as you think about commercialization?

Sure. Thanks, Mayank. So with WHIM syndrome, as we've highlighted, it is a genetically defined disease with gain of function mutations in CXCR4. And what we're excited about already is the Phase II proof-of-concept data that was published recently in blood towards the end of last year. And really, what it shows, our Phase II data is incredibly compelling. It basically shows that a once-a-day oral drug can really get at the root cause of WHIM and address the kind of 3 legs of the stool of the disease, which are defined by very low white blood cell counts and specifically very severe neutropenia. These chronic infections, which create massive morbidities and functional loss for patients, they lose their lung function, lose their hearing and have, at some times, life running sepsis. And finally, the third leg or third problem of the WHIM syndrome equation is around their risk to HPV associated cancers as represented by these very severe lesions that they present with clinically. Our Phase II study shows we hit on all 3 of those. It really sets up our ongoing Phase III for a high probability of success. The primary endpoint is a biomarker endpoint around the elevation of neutrophil counts throughout a 24-hour time frame, and that's measured throughout the course of the year-long study. So the Phase III is really -- and I've spent some time at Genzyme, so I had a number of opportunities to examine rare disease programs, both internal and through corporate development opportunities. This molecule have it all in one package. And then I think the Phase III is might be very well powered and designed to show the true benefit for these patients. We're really excited about where we're positioned right now. And then when you talk about the prevalence and sort of what's the commercial story longer term, these ultra-rare diseases really need champions to understand the true prevalence, and that's what we've been for this patient population. So our market research shows about 1,000 genetically confirmed WHIM patients in the U.S. and that's -- and then we believe there's more certainly beyond that, about another 2,500, so 3,500 are in total potential WHIM patients based on those that are undiagnosed. Diego has a small team of MSLs who have really been doing a wonderful job, championing education and awareness so that clinicians and patients can develop that sense of understanding, and we've been getting even more deeply connected into those communities, which will help obviously the long-term opportunity for us and for the patients. And then I actually think SDN fits strategically very well into this. Diego described our translational study. Our vision is as WHIM is approved, hopefully, in the next couple of years, we see SDN as a potential broadening of the indication as a follow-on. And that really is a really nice leverage point for the commercial infrastructure that we'll be able to be building over the next several years that we can maximize the number of patients we could potentially benefit with mavorixafor that have these congenital neutropenia.

That's a lot, Paula, you covered. And it's very important work from a -- as you said, like Genzyme model has done that on a repeated basis. And just -- there's a different kind of muscle that goes into it. So maybe Adam, we only have a couple of minutes. Maybe if I can bring you in. Obviously, you are the enabler, you had one funding everything. So maybe just kind of talk at us how you think about the corporate and clinical -- like the catalyst we talked about but also layer in the company's financial situation? And how do you think about your balance sheet?

Sure. Yes. Thanks, Mayank. So we're starting from a strong cash position of about $90 million as disclosed as of September 30. And that takes us into the first quarter of 2022. And as the team mentioned, we'll have some key milestones over that runway period. So that includes Waldenström’s data, completing won enrollment, WHIM prevalence updates and SCN data. So we certainly believe those are important catalysts for the business that are funded and could drive transformational value throughout 2021. And as we think ahead, those catalysts could represent opportunities to leverage into the future runway of the business as we have those achievements and externalize them as appropriate.

That's great. And I guess in closing, Paula, anything else that was not covered, I just want to make sure I give you an opportunity. Any other -- actually, there's one more question. I wanted to make sure. I think Art had covered. You have this kidney cancer data, right? And some of the interesting works that I think literature also supports the use of join combination with even radiation moving earlier lines. So maybe just talk to your thinking on the IO side and again, that comes in because of the balance sheet discussion because you have to make certain strategic choices. So maybe an update on that would be great. You literally have 30 seconds.

Sure. So kidney cancer trial showed a 50% or more improvement versus historical benchmarks. So the signal is clear. is a great strategic partner for us to leverage additional data and broader indications in China, which will leverage and can kind of use that for rest of the world. So I mean the company is incredibly well set up for a successful trial and WHIM broadening out with our current indications ourselves and leveraging our strategic partnership data to even go beyond that. So it's a great story as we look into 2021 and beyond.

Awesome. Thanks for that quick update. And I appreciate everyone for spending this time with us, and good luck for the rest of the conference. Thank you.

Thanks so much, Mayank.

Appreciate it, everybody. Thank you, Mayank.

Thank you, everyone. Take care.