Aligos Therapeutics Inc Stock

All right. Let's get started, and good afternoon, everyone. Thanks for joining us for Jefferies London Healthcare Conference. My name is Clara Dong, one of the biotech analysts here at Jefferies. So it's my absolute pleasure to welcome Dr. Lawrence Blatt, CEO of Aligos Therapeutics, to give us a presentation here. Welcome.

Thank you, and thank you to the Jefferies team for inviting us to present today. I'm going to walk through our portfolio at Aligos today. And while doing that, I'll make some forward-looking statements. So we have a large Phase II pipeline at Aligos. Our lead program is in hepatitis B. The molecule is called pevifoscorvir. We call it pevi. Previously, you might have heard of ALG-184. I'll talk a lot about that molecule today. In addition to that, we have a drug -- purpose-built beta thyroid agonist, ALG-009. That's completed Phase IIa testing. I'll talk a little bit about the results there as well as some preclinical results we have in obesity.

We -- in addition to those molecules, we have a protease inhibitor for coronavirus. It's a pan-coronavirus protease inhibitor. And right now, here in the U.K., it's undergoing a Phase II study that's being funded by the MRC. In addition to that, in our preclinical portfolio, we have an antisense oligonucleotide targeting hepatitis B virus as well as an antisense oligonucleotide targeting hepatitis delta virus. So I'm going to dig deeper into chronic HBV infection. I think most people know that HBV is the largest chronic viral infection in the world that causes morbidity and mortality. 250 million patients living with chronic HBV. In Western Europe, there's 14 million patients. In the United States, it's around 2 million to 2.5 million patients and in Mainland China, 70 million patients living with HBV.

Like MASH and other chronic liver disease, HBV causes end-stage liver disease and liver cancer. And the primary goal of therapy is to prevent end-stage liver disease and liver cancer. Now currently on the market, there's 2 different modalities available. One is the standard of care, which are nucleoside analogs. And these drugs work by blocking the copying of the viral genome. So HBV is a retrovirus just like HIV, and the nucleoside analogs are reverse transcriptase inhibitors. Unfortunately, while patients are on nucleoside therapy, they still can progress to end-stage liver disease and liver cancer.

And a recent study in Taiwan demonstrated over a 5-year period, patients with nucleoside analog therapy, 4% of them went on to get hepatocellular carcinoma, 5% went on to get end-stage liver disease and 1% died or had a liver transplant. There's also another drug available, pegylated interferon. It's not widely used in the West. The response rates are low and causes significant toxicity. Now to put a finer point on the unmet medical need, this study was out of Korea, and it looked at the number of patients achieving full viral suppression on nucleoside analogs or standard-of-care therapy versus patients that were partially suppressed.

And here, they define full suppression as patients going below 12 international units of HBV DNA. And what they saw was if you can achieve below 12 or full suppression at 1 year, you had a protective effect against getting hepatocellular carcinoma over the next 5 years. And likewise, if you had suppression below 12 even in 2 years, that was still protective effect for patients that did not achieve full suppression. So let's think about how HBV causes end-stage liver disease and liver cancer. The first issue, and that was highlighted in the Korean study is that replication of the virus or the virus making copies of itself causes an inflammatory response as well as tissue damage, and that leads to inflammation and a wound healing response.

And instead of normal hepatocytes being deposited, you get scarring or fibrosis and in later stages, cirrhosis of the liver. And this can be transformative causing hepatocellular carcinoma. So in the first order, blocking replication completely would lead to less inflammation and less tissue damage, less scarring, less end-stage liver disease and liver cancer. HBV has another way that it can cause end-stage liver disease and liver cancer, and that's through: one, integration of the viral genome into the host chromosome; and two, by establishing an extra chromosome called cccDNA, which acts as a reservoir for the virus.

And when HBV integrates, it can either activate an oncogene directly transforming the cell to a cancer cell or it can cause the production of HBV antigens, including HBV S antigen, which is a potent immunosuppressive agent, and that sets up the cancer environment. And lastly, HBV can integrate into a normal housekeeping gene in the liver and destroy that hepatocyte and cause end-stage liver disease and liver cancer. So what you really want to do is block both the replication of the virus as well as the integration of the virus and the establishment and replenishment of cccDNA. Pevifoscorvir belongs to a family of drugs called capsid assembly modulators.

And unlike nucleoside analogs, which only block the replication of the virus, capsid assembly modulators, when designed in the right way, can block both the replication of the virus by blocking the encapsulation, the pregenomic RNA as well as the establishment and replenishment of cccDNA by blocking the transport of that HBV DNA into the nucleus and thereby also blocking the integration. So if we go back to the chart that I just spoke about, the capsid assembly modulator has the potential to block all of the disease processes that lead to end-stage liver disease and liver cancer for HBV. Our drug, pevifoscorvir or pevi, initially started its life in the laboratory of Ray Schinazi at Emory University.

Ray discovered very potent capsid assembly modulators that were picomolar potent. So mostly, we talk about nanomolar potent molecules. The molecules we in-licensed from Dr. Schinazi were picomolar potent. And when we began to look at them for pharmacological properties, we noted that they had -- the compounds that we got from Ray's lab had poor pharmacological properties. They had rapid metabolism and low oral bioavailability. So our laboratory further modified those compounds to block metabolism, and we increased oral bioavailability from 5% to 80%. And that became what was known as 184 or now pevi.

In early Phase I clinical studies, we showed for HBV DNA reductions starting at 10 milligrams all the way to 300 milligrams in 28-day studies, full suppression of HBV DNA. But what was more interesting, at the higher doses, we were able to show a reduction in HBV surface antigen, which was indicative of the second mechanism blocking the establishment and replenishment of cccDNA. And this, to date, is the first and only capsid assembly modulator that has been in the clinic that has demonstrated effects on cccDNA, and I'll show you more of that data as we go through our clinical trials. Following the 28-day study, we set up a long study, a 2-year study in HBV patients.

And we have several cohorts to look at here. The first cohort we did was a combination of pevi plus a nucleoside analog, entecavir. And the reason we did this initially was that the capsid assembly modulators that have been in the clinic prior to pevi had caused drug resistance as monotherapies. In our case, we also did a monotherapy arm. And I can tell you in advance, there was no drug resistance that occurred to pevi. In addition to the monotherapy and the combo arm, we had another arm that had nucleoside analog or entecavir therapy for the first 12 weeks, and then those patients were switched to the combination of entecavir plus pevi.

And now we can look at the quantitative HBV DNA reduction results. In the orange line, we can see the entecavir, the standard-of-care therapy that gives you something like a 3.8 log reduction in HBV DNA. In contrast to that, the pevi monotherapy arm or the pevi combo arm had log 1.5 to log 1.8 greater log reduction in HBV DNA compared to entecavir. So you can see that our drug is much more potent at reducing HBV DNA. Now it's very interesting to note that when we combine pevi with entecavir, you don't see any additive effects. And that's because pevi is completely blocking the encapsulation of the pregenomic RNA, leaving nothing for the nucleoside analog to do. If you look now at the individual patients in monotherapy, we divide these patients between E-positive.

These are earlier patients with higher baseline DNA, higher baseline S-antigen, higher RNA and E-negative patients, which are more advanced patients that have partial immune response to the virus. These patients typically have lower baseline DNA, lower S-antigen, but higher degree of integration. What we can see very clearly is that pevi rapidly drops HBV DNA in both patient populations. By week 48, 60% of the E-positive patients are below 10, which is the limit of quantitation for the assay. And by 96 weeks, 100%, including those patients starting very high at 1 billion copies.

This is rarely seen with nucleoside analogs, and I'll show you that in the next slide. For the E-negative patients who started at a lower baseline, about 5.5 logs, by week 6, all but one of the pevi patients were below 10 or negative for HBV DNA and one patient took out to week 20. By week 48, all patients treated were below the quantitative limit or negative for HBV DNA. And in fact, they not only were below the quantitative limit, the qualitative limit of detection of the assay was reached in 10 of 11 patients. So by the end of the study, week 96, that response was maintained. So 100% of patients E-negative, 60% E-positive.

Now how does that compare to standard-of-care nucleoside therapy? In the Phase III study comparing tenofovir, 2 forms of prodrug, either TAF or TDF, Gilead reported not only below the cutoff of 29, which at that time was the approvable endpoint, but also below detection, which was 10. At week 48 in E-negative patients, they had about 20% below 10. And in our studies, we have 100% below 10. By 2 years, they had 1/3 of patients below 10 and in our study, 100% of E-negative patients. E-positive, they didn't report anyone below 10. At week 48, we had 60%.

And at week 96, they had between 9% and 14% below 10, where we had 100%. So you can see there's a big delta between the response rate. And recall the Korean data were going below 12 was protective against liver cancer. In our case, we're going below 10 and even below 4 in some patients. Now what about antigen reductions? The only way that our drug can cause antigen reductions is by reducing HBV cccDNA, and that's by the mechanism that I showed earlier. In this study, we had E-positive patients reduce HBV S antigen by about 1 log and correlated antigen and E-antigen by over 2 logs.

And the reason that S-antigen line is flattening out about week 36 is because what's happening is the S-antigen from the cccDNA is being exhausted and the remaining S-antigen comes from the integrated HBV DNA in the chromosome. For the core and E-antigen, we're approaching the limit of detection. So that's why the line is flattening out towards the end there. Now what about the safety of this drug? The drug is incredibly safe. We had no patient dose reduce or come off therapy for any adverse event. We did have some patients have elevation of liver test, ALT. That's very commonly associated with reductions in antigens, and these were deemed to be transient flares.

The ALT went up and down while they remained on therapy. Now in this study, we just recently reported what happens when you stop therapy, and this is really important data. So first of all, you can't just abruptly stop HBV patients because we know from nucleoside analog therapy, if you stop abruptly, patients can have severe immune response to the reactivation of the virus and patients can die. So instead of stopping abruptly, we offered the patients nucleoside analog therapy. Now nucleoside analogs don't suppress RNA. They don't suppress antigens. So if we had not lowered cccDNA, you would have expected full recovery of the antigens and the RNA to baseline.

That's, in fact, what did not happen. So in this study, in the E-negative groups, the RNA only slightly rebound in 2 patients. The remaining patients had no rebound. And the patients that had slight rebounds were less than 0.5 log of increase in RNA. In addition, the antigen reductions we saw were maintained over 8 weeks. Again, the only way this could have happened is if we reduce cccDNA. In the E-positive patients, we saw a slight rebound in RNA, so about 0.5 log to 1 log rebound in RNA, but not to baseline. This also tells us that we reduced cccDNA. And the S-antigen, E-antigen and correlated antigen did not rebound, indicating that we knocked down cccDNA.

So this was -- finding was highlighted in the median -- the meeting highlights at the AASLD summary slides at the end of the meeting. We were very happy to see that. So currently, we're in a Phase II clinical study of pevi. This is a worldwide study being conducted in U.S., Canada, Europe and Asia. What we're doing is comparing pevi to TDF, one of the standard care of nucleoside analogs. This is a randomized blinded study. They either get pevi plus a placebo for TDF or TDF plus a placebo for pevi, divided into E-positive and E-negative patients.

And in this study, we have an interim analysis that will look at quantitative reductions in HBV DNA, and that will help us to see if we're on track and determine whether if we need to adjust the sample size or perhaps try to convert this into a Phase III study. Now a lot of you have probably heard about drugs, antisense oligos that are focusing on patients for functional cure, and that's defined as patients' losing S-antigen, HBV DNA and normalizing ALT while they go off therapy. But I want to point out that, that therapies only works in patients with a baseline S-antigen of 3,000 international units or less. That composes or comprises 30% of all HBV patients. So 70% of all HBV patients aren't even eligible for that therapy.

And in that 30% of patients, they're getting between a 20% and 25% response rate. So that's something like 6% of HBV patients will have a functional cure, leaving over 90% of patients needing better chronic suppressive therapy. And that's where pevi comes in. And we see pevi becoming the standard of care for chronic suppression, but because we can suppress HBV cccDNA and integration, the choice molecules combined with therapies that are aimed at functional cure. So pevi would be used in both of those circumstances. We have a number of milestones coming up for the company. We already met the first 2. So we announced the initiation of our Phase II study in August.

We've just presented the data that I showed you, especially the off-treatment responses at AASLD. And importantly, early next year, we'll be announcing when we'll do the interim analysis from the Phase II, and that will give us good confidence around the HBV DNA reductions. And in '27, we'll have the top line readout of the primary endpoint for that study. So looking forward to those milestones. Now briefly, I want to talk about 009, our beta thyroid agonist for MASH. And what we've been able to do is to look at the competing beta thyroid agonists that are out there and to address the pharmacological weaknesses of those molecules. So 009 was developed in our lab.

It has around clinically 100x the potency of resmetirom. Its alpha to beta selectivity is 5:1. Resmetirom is about 2. And it has linear and non-variable PK. Resmetirom has highly variable PK. That's why the approved dose is 80 to 100 gives about 3x the exposure. We also do not have any CYP liabilities, and that's one of the issues we see with resmetirom. Now I should say resmetirom has done a fantastic job at validating that beta thyroid agonists are active in MASH, both in reduction of fat and reversal of fibrosis. We did a Phase IIa study with this molecule and demonstrated by MRI-PDFF, a noninvasive test for fat in the liver, almost a doubling of the fat reduction reported for the -- equally 12-week Phase II study with resmetirom.

And this drug is currently ready to go into Phase IIb and perhaps even to acceleration now that the FDA is relaxing the need for biopsy in this patient population. Now in addition to that, that was -- I had the wrong slide. So in addition to that data, we have data recently demonstrating that 009 can be given in combination with incretins and activate the metabolic pathways that block the metabolic adaptation. So many of you are aware that when integrin (sic) [ incretin ] therapies are given, you get rapid weight loss and then the body gets into a starvation mode and adapts to where it's no longer burning fat.

And that's the plateau region in the integrin (sic) [ incretin ] therapy. And this happens either with mono agonist or dual agonist. And what a beta thyroid agonist has been shown to do, and we'll be reporting the full report on this at the upcoming Hep-DART meeting where we have an oral presentation that when you give 009 in conjunction with either a mono or dual beta thyroid agonist, you can actually increase the weight loss period and block the metabolic adaptation and increase weight loss. So that's some pretty exciting data of a new use for beta thyroid agonist. So with that, I thank you for your attention, and I hope I haven't gone over. There's no clock here. So I don't know how long I've been talking. Thank you. Any questions?

[ Blatt ], I have one question [ to ask ]. Just -- maybe previous capsid assembly modulators, I mean, we've seen the data [indiscernible] they kind of regularly develop resistance. So based on your finding, I think pevi actually shows data against those variants [indiscernible] with that feature.

I couldn't hear, I'm sorry. What was the question one more time, Clara?

I'm sorry. No. So previous capsid assembly modulators, they have -- as monotherapy, they develop drug resistance. So how does your finding that pevi seems to have activity against those variants, how does that [indiscernible].

Yes, yes. So -- so that's true. And in our study -- so the resistant variants to the other capsid assembly modulators are actually naturally occurring variants that occur in the population of HBV patients. And in our study, those variants were present at baseline in some of the patients in our study. And we knew that we would be active against the variants because we tested them in vitro prior to going into the clinic. And in fact, when we did our study, none of those variants emerged. Now so you might ask why is that the case. And the reason is that the binding mode of pevi avoids those amino acids that change in the resistant variants.

And that's a typical way that you can block drug resistance for antiviral agents. The implications for that are that we can do monotherapy. And that's a very important point because if we couldn't do monotherapy, the endpoint of chronic suppression would not be available to us. So the FDA guidelines are very specific that if you want to get approval for chronic suppression, you must do monotherapy. So that's actually a big deal for pevi.

The previous capsid assembly modulators tried to go forward with chronic suppression, but needed nucleoside analog combination therapy to block the drug resistance. And incidentally, the previous capsid assembly modulators had additive effects with nucleoside analogs, indicating they weren't completely blocking the encapsulation of the pregenomic RNA. In our case, there's no additive effect with the nucleoside analog.

Thank you.

Yes. Thank you. Thanks, everybody.