Zai Lab Limited (ZLAB) Earnings Call Transcript & Summary

All right, welcome back, everyone, to the third session of the first day of Citi's virtual oncology summit. I'm Yigal Nochomovitz, biotech analyst here at Citi. So for the third session, we have with us the Head of R&D at Zai Lab, Rafael Amado. So welcome, Rafael. Thank you so much for taking the time to chat with us. [Operator Instructions] So with that. Obviously there's a lot going on at Zai Lab in the oncology world. Of course, you don't just do oncology, but we're going to focus on oncology today. In addition to, of course, the approved drugs, there's a lot happening on the R&D, so you want to start maybe just by giving us a high-level overview of what are the key assets in the pipeline on oncology, maybe some of the key data readouts that everyone should have on their calendars for 2025. And then we can go into more detailed discussion on specific assets as desired.

Absolutely, Yigal. And thank you so much for having me today. I wanted to just start by giving a brief overview about Zai for those of you that are not very familiar with the company, but we are a commercial-stage biotech. We have our own research and end-to-end R&D capabilities. We are in the market in China and in research and development both for regional assets as well as global assets, and we are in a variety of therapeutic areas. Oncology is perhaps the most prominent, but we also are in autoimmune disorders, neurosciences. And we've developed some antibodies in collaboration with other partners as well. And we focus on first-in-class and best-in-class molecules through open innovation, collaboration; as well as internal-discover assets that come from our laboratories both in Shanghai as well as San Diego. I'll highlight a few of our leading programs and starting with oncology. We have built a diverse and differentiated pipeline across targeted therapies, antibody-drug conjugates and immuno-oncology. And we also have a device sort of a franchise under -- with our partner Novocure on tumor-treating fields. So for instance, our most recent sort of data presentation was on DLL3, which is called ZL-1310. And this is an antibody-drug conjugate for small cell lung cancer. This is a great example of strategic partnership work. We have global rights to this product. And perhaps we can spend some time later talking about our initial Phase I study results that were presented at ENA about 3 months ago. Beyond ADCs, we're also advancing specific areas of immuno-oncologies, particularly an interest in T cell engagers as well as ways to improve PD-1 and cytokine-type therapy. And outside of oncology, we focus on immunology discovery and development. And our lead molecule is a bispecific IL-13/IL-31, which we intend to develop for atopic dermatitis and other indications that are amenable to the blockade of these cytokines. So we have set ourselves a goal of having 1 or 2 new INDs per year. And our regional pipeline is very broad. I will just highlight that in cancer, for instance, we have bemarituzumab in collaboration with Amgen, which is an FGFR2b both receptor, inhibitor for those that are positive for this market; Tivdak, which is a product that we're filing now in collaboration with Seagen, now Pfizer, for cervical cancer. It's also an antibody-drug conjugate. And outside of oncology and the regional area, we have KarXT, in collaboration with Bristol Myers Squibb, for schizophrenia as well as a variety of other indications in psychiatry; efgartigimod, which is FcRn receptor inhibitor which is across multiple indications in autoimmunity; and recent addition, like povetacicept, which is in collaboration with Vertex for IgA nephropathy. So all our products have potential transformational-changing medical care type properties. And we choose them very carefully for that with our partners on the regional side. And then on the global side, which is more incipient, we also are looking for big first-in-class differentiated molecules or improved molecules such as best-in-class new-generation ADCs, DLL3 or 1310 being a good example of the latter. So hopefully, this gives you a broad sense of our footprint which is both global and regional and across therapy areas that encompass oncology, autoimmunity and neurosciences.

Okay. No, that was very comprehensive certainly, a lot to discuss.

So we'll start with the oncology. So 1310, you mentioned, the ADC targeting DLL3. There's a ton of interest in this target. As you know, there are several players in the space. You're one of them. You have the data recently. Can you talk about what were the key conclusions out of that data; and then how you see this asset as differentiated potentially from the others in the space in terms of molecule design, be it the payload, the way you're developing the antibody or -- and/or the linker?

Yes. This is a product that has moved very fast in our pipeline. The IND was just December of last year. And we drove it through dose escalation and dose finding both in Asia and the United States, and now more recently we've added Europe. And we completed dose escalation. And we presented data, efficacy data, in 19 patients; and safety data on 24 patients. And the response rate was 74%. Some of them were still unconfirmed, but we thought that it was really remarkable, in terms of the performance of an ADC, to really start disseminating the data in the community. So out of these, there were 9 unconfirmed responses at the time. So it was early data, 5 confirmed responses, but what intrigued us was not only the high response rate, but patients were responding at the very first dose, yes. So a relatively flat dose response. There were responses across all the doses that we tested. And they responded very quickly within the first cycle. We saw a patient respond that had failed tarlatamab. As you know, tarlatamab is a T cell engager that binds DLL3. So it's the same target. And this patient continued to express DLL3 and had a 67% tumor reduction, so it appears that there's no cross-resistance at least anecdotally with this patient. And we're enrolling other patients as well. And importantly, we saw a response in the brain in all the patients, 6 out of 6 patients. And this is a big problem in -- as you know, in small cell lung cancer, so -- and we saw it in both lesions that were pretreated with brachytherapy as well as patients that were untreated. And then with DLL3 levels with H-scores as low as 2, we started to see activity, so -- and in terms of the product durability of response, it was still immature at that time, but there were -- there are now patients. And we sort of released this at JPMorgan: They're having a response for 9 months and beyond. We now have confirmation data on all 25 patients. And we started dose optimization and that is accruing really well. And we plan to update these results, both the totality of the dose escalation as well as the preliminary data with the dose optimization, in the first half of this year, so pretty excited about this product. So far, what we're seeing aligns very well with what we presented at the triple meeting in Barcelona. And we are in regulatory discussions to see how we can expeditiously move this forward. And then I'll just say, with regards to some of the questions that you asked, it's a DAR8. So it has [ a 8-molecule sort of ] payload per antibody and it has a very high affinity. And it has this system called [ T mailing ] whereby there's penetration and internalization of the ADC in cells that bear the target. There is hydrophobicity, so the payload does not get released from the cell. However, the linker is cleaved in the matrix of the tumor, in the tumor microenvironment. And it can penetrate cells that are target negative through a bystander effect. So I think that combination of DAR8, the high affinity of the antibody and this system bystander effect is really what's led to this high response rate that we've observed.

And the specific chemical entity that's the payload is which...

This is a Top1 inhibitor [ called ] C24.

Okay, yes. And in terms of the design, as you pointed out, the cleavage in the tumor microenvironment, as opposed to the cleavage in the -- within the -- once internalized, how do you see that as an advantage potentially, as far as both, I guess, on efficacy and/or safety?

Well, there is cleavage intracellularly that also occurs, but the drug doesn't efflux the cell. And the additional efficacy, I think, is related to the fact that it can be cleaved in the microenvironment and penetrate cells that don't bear the target, so I think that's what really leads to us being able to see responses in patients that expressed very low levels of DLL3. In fact, the only patient that progressed did not express DLL3. We only see -- saw 1 patient out of 25 in that series. Everybody else had some kind of decrease in tumor size. Even the ones that didn't respond had stable disease, with some shrinkage. So I think it's, again, high concentration in the tumor microenvironment. And when we look at the PK profile of this molecule, there's about [ 4-log ] difference in concentration between the intact ADC and the payload itself. So the payload circulates at a very, very low level because it is highly concentrated in the TME. And I think it's because of that -- how rapidly it can penetrate cells, including those that don't bear the target.

Okay. So it's obviously -- and small cell lung cancer, you're going to go forward. And when are we going to have a sense as to the exact study and what's the next study design going to look like, for small cell? And then are you looking at other neuroendocrine-type tumors?

Yes, great question. So we obtained orphan drug designation and have initiated breakthrough designation discussions and other discussions with FDA. The 2 drugs that are approved in second line -- the most recent 2 drugs were approved as accelerated approval. And Imdelltra or tarlatamab is the most recent one. It's a T cell engager, as I mentioned before. I think everybody recognizes that this remains an unmet medical need. And there's a dearth of agents that are actually safe and effective. Importantly, because the tumor is chemo sensitive, what's required also is durability of response, so -- we still believe that accelerated approval is a pathway, and we are discussing with FDA what is the best way to achieve this. Obviously one way is to continue, and under Project Optimus, finding a dose and extending that dose and file as a single arm. And that's what tarlatamab did. The other way to obtain accelerated approval is to launch a randomized trial and do an interim analysis for response, obtain accelerated approval that way; and then confirm the approval with overall survival. So I think we will sort of sharpen the strategy as we go forward. And we are doing combinations now in frontline as well to start dose optimization in frontline and do registration trials in first line under FDA guidance to move these products early on. You mentioned neuroendocrine tumor. And neuroendocrine carcinoma is expressed at very high level. And this is really a disease without really any effective therapy, and so there's been a great interest in the field on this molecule. And we just a few weeks ago received a "may proceed" letter for an IND in this disease. And we have really good centers that are going to start, next month, enrolling patients. And there are recent papers that you may have seen as well of DLL3 being expressed in other tumor types, like certain pediatric CNS tumors, certain subtypes of non-small cell lung cancer, melanoma and also neuroendocrine tumors that are not carcinomas but they're slower-growing tumors. So I think our plan is to try to extract as much potential value for patients with this product, but our first indication obviously, as you mentioned, would be second line and beyond in small cell lung cancer -- and then very rapidly move it into frontline as we -- and at the same time, we'll obtain data in neuroendocrine carcinoma.

So of the 2 strategies you mentioned, this talking to the FDA using Project Optimus versus doing a randomized study, as you pointed out, with the accelerated approval, which of those is the one that seems to be more favored or likely? Or that's all up for discussions you still have to have. It's the data is just being generated now, obviously.

Yes. I mean Project Optimus is required, anyway, whether -- in either strategy. We have to have a dose that and -- agree with FDA on what is the optimal dose, but as you know, traditionally, ADCs have had a narrow therapeutic index. So obviously the agency will -- in discussions with us as a sponsor. We will come up with a dose that achieves the right balance of benefit-risk. I think, more recently, the agency has advocated for randomized trials, even in the setting of accelerated approval based on surrogate end points like response, because it's easier for them and for anybody really to ascertain safety. And so that may be a way to go. It will save us having to do a confirmatory trial in second line. And it will be a single study. Potentially there could be a speedier registration if we were to do a single-arm study, but as I said, I think it's a bit premature. These discussions with FDA are taking place almost as we speak, so I think we're going to know very quickly where we stand with the agency. And we are also going to start discussions in frontline as well. And there is also the possibility of doing accelerated approval in second line with a single arm and confirmatory trials in frontline, so this is also an option that others have pursued. So what is clear, I think, is that, in drugs that are effective and safe and have activity that is durable, particularly in the setting of a great unmet need, the agency rapidly becomes a partner with the sponsor in trying to find a way to get the drug to patients as soon as possible. And that's our objective.

Okay. So just to summarize on the second line, but what is -- the next data set we're going to get from you is, what, just an update and a further maturity on the current 25 patients and then some information about the regulatory strategy, I would think, later this year. Is that fair...

Well, what we will present is, as you say, all 25 patients in the dose escalation study and with the possibility of confirmatory assessments for response. So all these patients that had unconfirmed response, we will know what the actual confirmed response rate is in each one of the cohorts, as well as the durability. We -- it is possible that we may not have reached the median duration, so we may need to represent this in some other way, but for instance, in the -- even in the lowest dose, as I said, we have patients now 10 months and beyond. So we will see how much follow-up we have, but in terms of response, their response rate will be mature. The other cohort that we will present will be the randomization between 2 doses to arrive at a randomized Phase II dose. And so that randomization started a couple of months ago, and we've enrolled really fast. And we will -- we should have data, both confirmed and unconfirmed, on an additional 30 patients or so. So I think, in total, there would be 50 patients, plus, including both dose escalation as well as dose optimization. Obviously the latter will have a shorter follow-up than the former, but we will begin to see really at least landmark analysis in terms of what is the proportion of patients that remain on response at a given time point by dose in the dose escalation phase and then by the 2 doses that were randomized in the optimization...

Which -- did you disclose which those 2 doses are that are getting randomized?

We haven't disclosed them. And obviously they will be disclosed at the time of the presentation.

Okay. I guess we can make our guesses as to which ones you decided not to pursue, but okay, we'll wait on that. Now as far as the frontline, what's the -- so what's the strategy going to be there? You're doing some combo work, correct, so what is the combo -- what are you combining with?

So the idea is to try to spare chemotherapy in frontline. And we will retain the checkpoint inhibitor. And in our case, we have started combinations with atezolizumab, with -- that and durva are both approved in small cell lung cancer. And then we're moving rapidly to combining the triplet with the lowest dose of 1310. And the third dose will be -- the third drug would be carboplatin. So our goal is to try to avoid etoposide, which is very myelosuppressive and, I think, limits the length of treatment that these patients can withstand. So once we have a dose with that doublet of atezo-carbo, we will initiate discussions with regards to the Phase III study. And it will obviously be compared with the current standard of care, which is etoposide-carboplatin; and either durva or atezo. So like what's seen with other ADCs, they combine well with checkpoint inhibitors. And they in some cases have supplanted chemotherapy, like perhaps for instance [ in GU ].

You can't -- so you're trying to do chemo sparing, but you're not going to get rid of the carbo altogether. You don't -- or could you try that?

We could try that. I think it is premature to say that we could do without carboplatin at this point. And unless we generate more efficacy data, it will be difficult to start a study with just atezo and 1310, but I wouldn't quite rule it out because -- I mean the response rate in second line, plus, is in the 70-plus-percent range. And that's what the current regimen gives. And so removing those 2 agents and adding 1310, plus atezo, may result in similar or superior. And the durability may be better just because patients tend to either become refractory to platinum or become intolerant after a [ medium ] of 4 or 5 doses. So it is possible that we may be able to remove carbo, but we'll have to have some efficacy data first.

Okay, that makes sense. And what are the time lines for frontline then? That's -- you started one already, right, [ for preliminary a while ago ].

Yes. We've been in dose escalation mode, so we have safety data with atezolizumab, but we didn't expect that there will be any issues with tolerability given that the toxicities are different, so we're now starting the carbo combination at the lowest dose of ZL-1310. And we will move pretty quickly to the next dose of 1310 and try to ascertain a dose. And most likely, as many sponsors have done -- but again this requires regulatory discussions. We may choose 2 doses of 1310 in an initial randomized phase of a Phase III study.

These doses, are they going to be synchronous with the monotherapy doses? I mean like, of the 2, you're -- is it going to be, 1 of the 2, you're randomizing in the monotherapy? Or it could be something else.

So in general -- I mean this is not just a question for our asset. This is -- a common question that arises in drug development with active drugs is do you need to do Project Optimus in -- with different lines of therapies and different combinations. Or is the dose different in monotherapy than it is in combination? And in general, the agency encourages sponsors to do dose finding, particularly if the combining partner agents are different. So in our case, obviously one is monotherapy and the other could be atezo or atezo-carbo, so we will need to do some dose optimization in frontline, but it is possible that the dose may be the same. I mean it just depends on what the data tells us.

Okay, okay. So that's the development plan. And then as you said, you're going to have the other neuroendocrine tumors. You've listed a whole bunch of those, which -- starting this year.

Yes. So the second-line pivotal trial, we hope to start it this year. We will discuss the best approach in frontline. We hope to finish the dose escalation and -- in frontline in combination with carbo and then choose which one to move forward with, whether it's the triplet or the doublet. And then we're starting pretty quickly to enroll the first patient in neuroendocrine carcinoma, first. And then other indications may follow, but we're concentrating on these 3 for the moment. But there's a lot of interest in moving this, as I said, particularly in CNS disease, CNS [ tumors ].

Okay. Then more of a bigger picture question which is more, I guess, a strategy question, but you're developing a lot of value here, presumably. So what are your thoughts, as far as how long you would take this asset forward yourself versus determine it's better suited with a global partner, for example, to even further accelerate?

Yes. Well, we are exploring all options, yes. Obviously we're doing all this work ourselves for now. And we want to generate as much data as possible, but we are considering potential partnership or out-licensing, whether it's geographically or -- we are open to discussions. Clearly there's potentially a lot of patients that could benefit from this drug. And we wouldn't want to leave any value for patients on the table. And we would like to maximize the potential for this drug, so we will continue to execute on what I related to you, but there's been discussions and there will continue to be discussions. And I think the decision will come, depending on the type of partner, the fit, the complementarity and whether it's by geography or indication or out-licensing or so on. I mean those are still discussions that we haven't finalized. We've been open to having these interactions, but I think it's still early to say where we'll land.

Okay. By the way, I also wanted to get your thoughts because you had some data in -- well, you had activity in brain mets. Is there something specific about this molecule that you believe is driving that activity in brain mets that may be different from others?

Well, it -- so first of all, we were very pleased to see it because, as you know, it's so common in small cell lung cancer. Up to 70% of patients have it. And I think it was really gratifying to see. We know the disruption of the blood-brain barrier in these lesions, but I think the high level of activity probably has to do with its picomolar affinity and also its high DAR, as well as this bystander effect. So it readily penetrates metastatic lesions. And whether they are target lesions or they're not target lesions, we've seen actually really important responses that have been very persistent. My sense is that it probably has to do mostly with a system, with this [ T mailing ] system, again the high affinity but also the half-life. This is an ADC that has a half-life of about a week, 6 to 7 days, whereas others, they have not seen a lot of activity in the brain and have a very short half-life. So I think dwelling time in the metastatic deposit may also influence the ability to elicit responses in the brain.

Okay. And then there are other ADCs hitting other targets, right? So for example, like a B7-H3 or B7-H4, for example. And there are some other ones. Is -- what is -- what do you believe is different with the DLL3. Is it just the expression level or something else about the tumor biology that makes it possibly a better way to deliver the chemo?

Well, B7-H3. If you look at the molecules that -- the ADCs that are out there, the responses have been in the 30s, 40s, except for YL201, which is a MediLink B7-H3 ADC which also shares this [ T mailing ] system as well, where they've seen responses in the 60s. I think -- and what we hear from our investigators and other opinion leaders is that there is no cross-resistance between these targets. And so it's good that there's another agent out there that is -- that has activity. Expression of B7-H3 is at least 10% lower in most series than DLL3. DLL3 is almost universally expressed.

Yes.

There are some differentiations between YL201. I mean it's, again, the half-life is shorter. The affinity of the antibody is lower. And whether that translates into differential activity and durability, I think it remains to be seen because we need more maturity of our data, but at least numerically and from what we are observing, we think this is probably the best-in-class ADC that exists for small cell lung cancer. So -- and of course, there's other modalities, as you know, like -- we talked about tarlatamab, but those -- that's a different mechanism of action and different level of activity. So yes. I guess the main point I would make is that, although there are -- B7-H3 is present in small cell lung cancer, most of the molecules that are out there in development are not achieving response rates in the 60s and 70s, except for the MediLink molecule.

All right, okay. All right, let's see. Let's move on a little bit since we've spent a lot of time on DLL3. All right, so for bema, that's the FGFR, can you just tell us -- that data is coming up quite soon, no? And what do you need to show for a Phase III study in frontline gastric cancer to be successful? That's the one, obviously, partnered with Amgen. It used to be the Five Prime drug.

That's right. This was the Five Prime drug. So there are 2 studies in this program, both in FGFR2b expressers. And one is with nivo and the other is without nivo. So the first study, which is 101, which is the one that's going to read out first, is FOLFOX6 plus/minus bemarituzumab. And we expect the data in the first quarter of this year, so soon. And as you know, the Phase II data was extremely promising. I mean the control arm in the Phase II study was pretty much in sync with what you would expect less than a year with placebo and about 25 months with bemarituzumab. So obviously that was a Phase II study. It was again doubling of survival with a hazard ratio of 0.5. So that's -- that really sort of gives us a lot of hope and enthusiasm that we are going to see positive data, but we will have to see it once the data is uncovered. And we plan to file this year, yes, in frontline. Then the second -- and the frontline with nivolumab, which is 102, there will be an interim analysis, but the final readout is still to be determined. It depends on what -- whether the study is positive and the DMC makes a recommendation this year.

Now this is one of these situations where Zai contributed to the global study. Is that right?

Yes. That's very true....

And what percent is -- how much did you contribute? Did you talk about that?

Well, we contributed, particularly in the 101 study, in -- because it's a study that was very difficult to do in the West because of the advent of nivo. Even though nivo only added a little less than 2 months of survival, it was very difficult to accrue to a non-CPI-arm study. So that wasn't really so much of a problem for us in China, where gastric cancer is very prevalent, so we went above and beyond what was required for us to be able to submit to CDE. And this was for the sake of the program and accelerating the program. I mean then the numbers were in the 150-plus patients and so on. On the 102 study, we've been able to bring that study about 5 months forward just by adding more patients from China, so I think Zai has been really instrumental in the bemarituzumab program. And it's been a wonderful partnership with Amgen to be able to, hopefully, bring this drug a lot sooner, working together.

But you're going to -- if you hit on frontline gastric in the first study, then you file right away. And then the nivo one comes later...

That is a discussion that's been had. It depends -- and I'm not sure what Amgen has announced or -- yet, but we -- certainly our desire will be to file 101 first.

Okay, okay. All right, let's try to hit a few of the other earlier programs. So you have another ADC. This is targeting LRRC15. First of all, can you tell us a little more about that target? That's not one that's super familiar to most people. And is it -- I get the sense it's probably less competitive than DLL3, but maybe there are a lot of early preclinical ones out there that are not -- that are under the radar.

Yes. It is a target that's expressed in fibroblasting in the tumor microenvironment. And so the initial idea was can we disrupt the tumor microenvironment and cause shrinkage of tumors. And also, because of this bystander effect, because this has the same -- even though the antibody was [ less discover ] as Zai, cross-linking is [ through the tumor link ] system by having the tumor microenvironment cleave the linker then target cancer cells that don't express LRRC15. So I think that question has never been asked with an ADC and is one that I think deserves to be answered, but in addition to that, there are tumors that express LRRC15 in their own right, like -- and particularly sarcomas. And osteosarcoma almost universally does. And then about half of the soft-tissue sarcomas do as well, so they are both in the fibroblast as well as in the cancer cells themselves. And there was some molecule called ABBV-085 from AbbVie that's, I think, a DAR2 but still had encountered some toxicity. We believe that this being a next-generation molecule will behave similarly to DLL3 with regards to the toxicity profile. And potentially the doses could be similar. And I think being able to understand this idea of using the fibroblasts as targets; and then the bystander effect on cancer cells for the non-expressing tumors; and also the target itself in tumors such as sarcomas, we've seen it in other -- in certain subtypes of breast cancer, I think has a lot of merit. And we are pretty excited about having this IND opened this year and start enrolling patients.

Okay, there are a few others we can just very briefly touch on. And then we can maybe ask a bit about autoimmune. So there's a ROR1 ADC. And then you have a CCR8, which is not an ADC. How do -- how do those fit into the prioritization of resources and level of investment?

Yes. So briefly: ROR1 could be our next product IND. We in-licensed that and we have global rights. We in-licensed it from MabCare. And ROR1, as you know, has been shown to be validated in lymphoma. There's -- it is expressed in solid tumors. And we've done extensive studies across multiple solid tumors, endometrial, ovarian, triple-negative breast and others. And we plan to go to solid tumors first with this product. So that's ROR1. And CCR8 is -- it's an antibody that essentially blocks the cytokine which is critical for migration and the population of Tregs in the tumor microenvironment. That Phase I study continues. We haven't said very much, but we are testing it primarily in tumors that are not susceptible to checkpoint inhibition, perhaps because of the inhibitory effects of Tregs. And so far, we are pleased with what we're seeing. And we are still in dose escalation and scheduled escalation as well to see -- because the dynamics of repopulation of Tregs vary in different organs. And so the studies still continue in the dose and scheduled setting, but we are actually pleased with what we have seen, so far, with this product. So we will make a decision on it as to move it to the next stage by the middle of this year.

Okay. Well, let's try to sneak in a few non-oncology questions. Even though this is technically the virtual oncology summit, I think we'll give you a pass since you have a lot of interesting things. So tell us quickly: You have an IL-13/IL-31 bispecific, which is an interesting combo. What's the design rationale for that? And how is it going to be differentiated potentially from dupi...

Yes. We're actually pretty excited about this molecule. These are proven targets, as you obviously know. And dupi is IL-4. We think IL-13 may be safer. And there is perhaps some evidence that there may be less conjunctivitis and better tolerability, but because it's linked to 31 -- so if 13 blocks a ligand, 31 blocks a receptor, it involves each a itch-scratch inflammation cycle that is seen in atopic dermatitis. And that's key contribution to increasing the speed to resolution of these lesions, as well as the durability. And we presented some data showing that it is effective in animals and that -- in nonhuman primates. And we're seeing, interestingly enough, a long half-life that, I think, would allow a long interval of self-administration that would -- could make this a more convenient, more active, potentially less-toxic product, so definitely one that we want to put a lot of resources on to take to Phase Ib or perhaps Phase IIb. But the development in atopic dermatitis and other pruritic disorders, and including also other disorders like asthma, et cetera, I mean, these are formidable sets of studies that are required, so we want to demonstrate proof of concept that this is actually a superior molecule and, hopefully, be able to partner with the best possible partner to develop it in AD and other disorders but -- and so far, everything that we're seeing preclinically and in GLP talks has been pretty positive.

Okay. And then the other one was the -- which this one is a little bit more advanced, but it's still in Phase II, is the topical IL-17 for flex psoriasis. How is that coming along?

That study is accruing. It's accruing pretty well actually. It has multiple arms. It's testing different strengths and different schedules, and it's against placebo. And we're coming up to an interim analysis in the second quarter. And we will -- that will determine, namely, activity and then a number of other translational markets as well, but we will get a recommendation from the [ IDMC ] as to what the next steps are. But we're pleased that the accrual has been brisk and that we will have a preliminary answer in an interim pretty soon.

And then the last one, on autoimmune, is the deal you mentioned, I think you did, with Vertex of povetacicept. So that's for IgA nephropathy, which is an interesting market in China. What are the plans there? And are you going to -- I assume you're going to need to do some kind of local study similar conceptually to what you did with KarXT to get the data.

It may be a little different. There are some Chinese patients that are already being enrolled. And so having patients already in the pivotal trials coming from China is always more desirable than doing a specific bridging study, as you know, so we're very pleased that the stage of the drug was such that we can just accelerate enrollment in that study. So we -- it's a very prevalent disease in China, one in need [ of first ] therapies. There are other molecules, but we think this is best in class. And we're pretty excited with this collaboration and putting resources to expedite the enrollment in the global study.

Okay. And then last big picture question, going back to oncology. Obviously you have a pretty heavy footprint in ADCs as well as just classical antibodies. What about other areas? Like, radiopharma is getting more interesting. There's lots of -- going on there. Or any next-generation immuno-oncology targets. There's a long list there. Are those areas you're focusing on for future BD?

So internally we have molecules that are aimed to enhancing PD-1 activity, like others. And I think this stems from the success of the PD-1/VEGF, but there's a lot of data suggesting that there are cytokines that -- in a bispecific manner with the right stoichiometry, you could deliver those cytokines that otherwise would be too toxic in combination with PD-1 and obtain better activity. So those were made in house. And we plan to move those into IND-enabling studies. And the other aspect of that, that is immuno-oncology is T cell engagers. And we think that these are orthogonal approaches to ADCs. And they obviously work very differently, but there are some really unique and interesting targets that could be approached with one or another type of modality. We are -- obviously right now have more ADCs, and we just named some, that are recently acquired, so you may see us this year, I mean, starting to penetrate the T cell engaging field. And we have some potential partners with whom we may start first in autoimmune disease and then moving to oncology.

Okay. So did I hear you correctly that you do have a VEGF/PD-1 or PD-L1...

No, no. No. Our combinations are bispecifics with specific cytokine, not VEGF.

Not VEGF, okay, but a PD-1 on one arm or PD-L1 on one arm...

Correct.

But you haven't done yet. I mean it sounds like you haven't talked much about that yet.

No, we haven't talked very much about it yet. And we will in the future as we develop more data.

Okay, awesome. All right, well, thanks again. Appreciate it. A lot going on. No doubt we're looking forward to seeing everything evolve. Thanks, Rafael.

Well, thank you so much, Yigal, for your interest. Pleasure. Bye-bye.

You're welcome. All right...