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Good morning, everyone, and welcome to the Cue Biopharma conference call on the CUE-221 CSU Phase II topline results. [Operator Instructions] I would now like to turn the call over to Agnes Lee, Chief Investor Relations and Communications Officer at Cue Biopharma. Please go ahead, Agnes.

Good morning, and thank you for joining us today. Before we begin our formal comments, let me remind you that during today's webcast, we will be making forward-looking statements that represent the company's intentions, expectations or beliefs concerning future events. These statements represent our views as of this date, are subject to risks and uncertainties and should not be relied upon as representing our views of any subsequent date in the future. As a reminder, this call is being recorded, and a replay will be made available on the Investors section of Cue Biopharma's website following the conclusion of the event.

With me on the call today are Dr. Shao-Lee Lin, our President and Chief Executive Officer; and Dr. Dominic Borie, our Chief Medical Officer and Head of R&D. Dr. Lin will open the call and then hand off to Dr. Borie to walk through the study data. Dr. Lin will then close our prepared remarks, and we will take questions.

With that, I will now turn the call over to Shao-Lee.

Thank you, Agnes, and good morning, everyone. Thank you for joining us. Today, we are reporting results from the Phase II study of CUE-221 in chronic spontaneous urticaria, or CSU. We're pleased to share that the study results were positive and that we will be reviewing together those topline clinical results with you today. The key takeaway is that CUE-221 met its primary and key secondary endpoints in a manner that reinforces our enthusiasm for the precision engineered, unique dual mechanism of action of CUE-221 and its potential to offer clinically meaningful and differentiated benefit in IgE-mediated disease.

Slide 3 summarizes the salient findings from the study. The study demonstrated robust, durable and dose-responsive clinical effects. The primary endpoint of complete resolution of hives, or HSS7=0, at week 12 was met with the treatment effect further increasing past the final dose at week 16 to its peak at week 22. The key secondary endpoint of complete response, or UAS7=0, was statistically significant in the high-dose group, further supporting the clinically meaningful impact of CUE-221. These results were achieved in the context of a favorable safety and tolerability profile.

Of note, for the CUE-221 high-dose group, both the complete resolution of hives and the overall complete response persisted for 12 weeks or full quarter and on the order of 5 half-lives after the last dose. This was not seen for the lower doses or for omalizumab despite a comparable dose level, highlighting a fundamental clinical difference consistent with the biological design differences between the 2 drugs and supporting the concept that CUE-221 has the potential to be a disease-modifying therapy. This marked difference observed off drug at week 28 relative to omalizumab provides our first clinical evidence supportive of the CUE-221 engineered dual mechanism of action that includes not only blocking of the IgE-mediated allergic cascade like omalizumab, but also supports the clinical potential of downregulation of new IgE production unique to the design of CUE-221. Additional PK and IgE data are of interest and while not available today, will be the subject of further modeling analyses and future presentations at upcoming medical meetings.

Based on this demonstrated potential for differentiated clinical efficacy in CSU and the potential to develop a new tool to target disease modification and the concept of functional cure for IgE-mediated diseases, we are more than excited to now plan both a Phase IIb/III next study in CSU as well as a Phase II study for food allergy.

I will now hand the call over to Dominic Borie, our Chief Medical Officer and Head of Research Development. Dominic?

Thank you, Shao-Lee. So let me take a couple of minutes to quickly walk the audience through the science behind CUE-221. First, reminding ourselves that IgE drives allergic disease by engaging 2 receptors, the high affinity receptor, shown here on the left, through which IgE and the allergen will trigger degranulation and allergic symptoms, and the low affinity receptor, also known as CD23, shown on the right, which is expressed on the surface of B cells and has an important role too as when bound by IgE, it triggers a natural negative feedback loop that results in reduced IgE synthesis.

On Slide 5, CUE-221 was designed to block IgE binding to the high affinity receptor and, in doing so, provides potent IgE neutralization or IgE blocking. CUE-221's high binding affinity for IgE, shown here on the left, supports a greater potency at preventing IgE-mediated cell degranulation over omalizumab, as shown on the graph on the right.

On Slide 6, on the flip side, CUE-221 was also designed to preserve IgE binding to CD23. And this was achieved through selecting binding sites on IgE that are distant from the IgE region that engages CD23, whereas the binding site on IgE for omalizumab and its analog, RPT-904, is the same, as shown on the right, and overlaps with the CD23 binding site and therefore, does not allow the drug IgE complexes to bind CD23.

On Slide 7, as the result of the difference in engineering, increasing concentrations of IgE in complex with CUE-221 can bind to the CD23 receptor, as shown by the orange curve on the right, whereas no binding at all was measured with IgE in complex with omalizumab, as shown by the gray triangles.

On Slide 8, the biologic impact of preserved binding to CD23 was demonstrated both at the mRNA and at the protein level, where addition of CUE-221 resulted in a significant reduction in IgE synthesis, shown by the orange bars, that was not observed for omalizumab, in gray bars, indicating that omalizumab in complex with IgE cannot block new IgE production.

On Slide 9, it was therefore very exciting to test the clinical impact of these fundamental biological differences in the context of a Phase II randomized, double-blind and placebo-controlled study. An omalizumab arm was included for comparative efficacy and safety, but no formal statistical testing was planned. The study enrolled participants with moderate to severe chronic spontaneous urticaria, or CSU, inadequately controlled with H1 antihistamines and patients were randomized to either 1 of CUE-221 dose groups at 1, 2 or 4 mg per kg administered subcutaneously or to omalizumab at the registered dose or to placebo.

All patients received subcutaneous injections every 4 weeks, and the primary endpoint was assessed at week 12 and measured the rate of complete resolution of hives, or HSS7=0. This endpoint leverages an objective assessment of the number of hives, which is carried out by the physician, and achievement requires all clear skin or no hives. The final dose in the study was administered on week 16 for all groups and after which patients were monitored off drug for 20 weeks through week 36.

Slide 10 shows the subjects disposition for the trial. Two subjects were randomized but not dosed, one in the 4 mg per kg group and one in the omalizumab group. The dropout rates are in range with expectation for a clinical trial of that duration, further considering the 5-month observation period off drugs. This study was analyzed using a modified intent-to-treat approach. The two subjects who were not dosed were not part of that analysis, but all other subjects were included in the modified intent-to-treat analysis.

On Slide 11, the baseline characteristics were overall well balanced across groups. Disease duration ranged approximately for 4 to 6 years across groups and mean baseline urticaria activity score 7, or UAS7, were in the 28-plus point range, indicative of severe disease activity.

On Slide 12, getting to the results, we are excited to report that the study primary endpoint was met. Complete resolution of hives, HSS7=0 at week 12, was significantly higher than placebo for all dose groups in a dose-responsive manner with a high p-value of less than 0.005 for the high dose group.

On Slide 13, the key secondary endpoint of complete response, or UAS7=0, was also met, and the difference versus placebo was statistically significant for the high dose group.

On Slide 14, another way to visualize the depth of response is to measure the change from baseline in UAS7 score at week 12, which was found to be profound and statistically significant across all dose groups.

On Slide 15, this slide captures the depth of response at week 12 by presenting the percent reduction from baseline in UAS7 across various mechanisms. Although we note that cross-trial comparisons are for illustrative purposes only and should not be interpreted as direct comparison of efficacy, across various modalities, CUE-221 seems to come closest to providing full control of disease activity.

On Slide 16, if you allow me to shift gears now, I want to focus on additional exciting findings arising after the week 12 primary endpoint. On the middle graph, across all CUE-221 dose groups, complete resolution of hives continued to increase beyond week 12 and peaked at week 22, which is 6 weeks after the last injection in a dose-responsive manner. More than 2/3 of subjects in the high dose group responded and achieved complete resolution of hives.

Now if we look at the week 28 results, this is a time point when patients have been off drug for 12 weeks. This corresponds to approximately 5 half-lives after the last dose for both CUE-221 and omalizumab, given expected half-life of 2 to 3 weeks for these IgG1 monoclonal antibodies. Let's also note that the 4 mg per kg dose is for a 70-kilo patient, the molar equivalent of the 300 mg XOLAIR dose.

At that week 28 time point, where 60% of CUE-221 patients are still experiencing complete resolution of hives, only 24% of patients in the omalizumab group are. And this stark contrast cannot be explained only by pharmacokinetics, as residual circulating drug concentrations are likely extremely low to nil for both groups. Rather, we think that this indicates a fundamental difference in biology and provides clinical data indicating that for the CUE-221 dose group, there is something different happening, which is more than just IgE neutralization.

Note that a post-hoc Fisher's exact test was run and found that the difference between CUE-221 and omalizumab was statistically significant.

On Slide 17, to provide further perspective, we are providing here this line graph showing the rate over time of HSS7 for the 4 mg per kg CUE-221 dose group, shown in orange, versus omalizumab and placebo. After the initial injections, there is a rapid clinical impact, and we can then clearly see the curve diverging after the last injection, reaching the maximal difference at week 28, as we previously discussed. This graph clearly shows the sustained high rate of complete hives resolution throughout the 12 weeks that follow the last injection of CUE-221. After week 28, both curves are converging again, trending towards the placebo response in the absence of further administration of drug beyond the week 16 dose.

On Slide 18, similar to the results seen for HSS7=0, a similar pattern of efficacy was seen with the complete response rate, or UAS7=0, which was also sustained for over 12 weeks off drug for the high-dose group, again, with the same pattern of marked clinical impact over omalizumab and supportive of a fundamental difference in biology that is consistent with a differentiated mechanism of action.

On Slide 19, building on the prior slides, we can start contrasting the features of IgE-targeted therapies. What we think stands out from the week 12 data is that IgE neutralizers like omalizumab or RPT-904, which share the same binding epitopes and therefore, the same biology of IgE neutralization, they appear to perform closer to CUE-221 low doses rather than CUE-221 high dose. Later time point data has not been made publicly available for RAPT. But again, we are extremely pleased with the different efficacy profile seen with CUE-221 over omalizumab at week 28 off drug as it supports fundamental biological differences, which may be directly deriving from CUE-221 engineering.

On Slide 20, from a safety standpoint, CUE-221 was well tolerated. There was no treatment-related serious adverse event, or SAE, and no adverse events of anaphylaxis. Treatment-related adverse event of special interest was limited to 1 case of grade 2 injection site reaction. There were 2 instances of treatment-related adverse events leading to study discontinuation, namely 1 case of worsening urticaria and 1 instance of insomnia. As expected, there were no deaths in the study.

On Slide 21, to help place the safety findings in context and because safety considerations will be part of the benefit-risk analysis when comparing across different mechanism of action, this slide provides a summary of anticipated side effect profile for different mechanisms investigated currently in CSU. We believe that CUE-221's dual MOA should not introduce specific mechanism-related safety that will be different from sole IgE neutralizers, even in the presence of possibly more potent IgE control, and this will be contrasting with the recognized mechanism-related safety findings of other MOAs.

We do recognize that broad interest for the field of allergy and IgE-mediated disease results in additional MOAs currently tested at earlier stages of clinical development. We believe that, although still emerging, CUE-221's potential is already more developed, and we look forward to further characterizing CUE-221's safety and efficacy profile for IgE-mediated disease.

On Slide 22, altogether, we are extremely excited to have clinical results in hand that indicate the potential to reach a functional cure for IgE-mediated disease. This did not happen by chance, but may result from the fact that from the very beginning, CUE-221 was engineered to be different from omalizumab and to not only block the high affinity receptor, but do so while preserving the binding to CD23.

The preserved capacity of CUE-221 IgE complexes to bind CD23 results in reduced IgE synthesis at the mRNA and protein level, something that was not seen with omalizumab. And here, we now have clinical data strongly supportive of fundamental biological differences between CUE-221 and omalizumab. We are eager to characterize the PK/PD relationship, and we'll be presenting these additional results at an upcoming scientific conference.

On Slide 23, I won't read this final slide, but it may be helpful to keep it staying up during the Q&A session.

And thank you for your attention. And now I will hand it back to Shao-Lee.

Thank you, Dominic, and thanks to those who have dialed in to be with us today. As you can see, we are very pleased with the potential that CUE-221 has now demonstrated clinically and which is consistent with its novel precision engineered dual mechanism of action. Based on these exciting positive results, we are working towards the initiation of a Phase IIb/III study in CSU in addition to our planned Phase II study in food allergy.

I would like to thank the Genesis Life Sciences team for designing and executing a robust Phase II trial. I would also like to extend our gratitude to all the patients, investigators and study staff who participated in this trial and supported the advancement of CUE-221 for allergic disease. It has been a privilege to be at Cue over the past 5 months and witness all the hard work and progress across our portfolio. And I want to thank the entire Cue team for their commitment to our mission to identify and advance transformative therapies designed to enable functional cures across immunologic diseases.

We could not do what we love to do without the support of our Board, investors and the patients we strive to serve.

With that, I'll open the call for Q&A.

Our first question coming from the line of Maury Raycroft with Jefferies.

Congrats on the data update. For the Phase IIb/III CSU study, should we expect a longer dosing interval than the every 4-week schedule used in the current study? And will you also evaluate additional dose levels? And is there anything additional on timing for when the CSU and food allergy studies could start?

Yes. Maury, thanks so much for joining us, and thanks for the question. So yes, I think we wanted to indicate with the IIb part of the Phase IIb/III that we're interested in understanding a little bit more about the PK, IgE and response. And so we're likely -- we feel like we have a fantastic dose at this point with monthly dosing that's differentiated. So we'll likely utilize that as an anchor, but nothing is definitive yet.

And then we're going to also explore, given the biology that we're seeing, how best to optimize dosing for each indication. And so for CSU or actually for any indication, for instance, we think that we have something where we can think about fixed dosing. We think, based on the profile that we're seeing, there's a potential to think about things like an induction and a maintenance regimen where we're fundamentally modifying some disease biology in the background. We think about this bathtub analogy and sort of not just emptying the bathtub from blocking or neutralizing IgE, but also turning off the spigot relative to the formation of new IgE.

And so one can imagine if you can continue to turn that off better and better over time that you might reach a point where the interval of dosing now instead of induction to achieve that time point, becomes a lower dose and less frequent in terms of a maintenance. So all of these things, I think we're going to explore, interrogate the data carefully and determine what the best sort of approach is to continuing to collect information about this new tool that we have to help patients with IgE-mediated disease. And so that's how we're thinking about it for CSU.

From a timing perspective, obviously, we think we have something important for patients, and we'll move as quickly as we can relative to that. I'd say for food allergy, something completely different. So we're -- we think of food allergy as a life-threatening disease. And in the context of thinking about that in that way, we think that this new tool gives us, as Dominic was saying, the potential to approach this from a functional cure perspective, meaning that we don't want just 2/3 of patients having protection against 3 peanuts some of the time. We want to get as close as possible to 100% of people having 100% protection all the time, as close to that as one can imagine getting.

And so we'll approach this sort of new tool, new mechanism, new potential to modify disease in a way that we'll aggressively pursue that ideal. And we don't think about this from a convenience perspective. I care less in that instance, if it's achievable, whether this is dosed every 6 months, 3 months or even weekly, but really about whether or not I can create an entirely different paradigm for ourselves and our kids and our families who have this life-threatening condition.

So I hope that helps. And thank you for your question.

Yes. All makes sense. Great perspective there. And one other specific question on the data. You reported change from baseline in UAS7, which appeared fairly similar across the 221 dose groups and omalizumab. How did HSS7 change from baseline compare across the treatment arms? And are you seeing a similar pattern there as well?

Yes. The patterns that we've seen across the endpoints have been very similar, which has been comforting to us from a robustness of the signal that we're seeing. So -- and we chose the change from baseline percent to compare with others because there are some studies that have placebo and some don't, and some have active comparators and others don't. And this was the best way to have an internal sort of a given arm to itself comparison within the context of its own study.

And our next question in queue coming from the line of Mayank Mamtani with B. Riley Securities.

Congrats on the spectacular data here. So on the response building for 6 weeks after the last dose, which was not a phenomenon for omalizumab, is there anything in the diary data that separates continued deepening in existing responders from maybe new responders converting late? I was obviously interested in that because the neutralizer with long half-life can only hold an effect, whereas your mechanism maybe can have that depth of response coming in late. If you could talk to that.

Yes, Mayank, thank you for that. So I think maybe the best place to see that is in the line graph or in the bar chart before that. And I know we're not sort of synchronized in terms of projecting, so I'll have to ask you, the audience, to go to those slides yourselves. But the bottom line is all of these representations are actually for complete resolution of -- so resolution of hives is what we've shown in the line graph for. And so there's no sort of deepening of response beyond the 0, right? And so the percentage just tells you the percentage of individuals that achieve that complete resolution of, in this case, hives response. So we are definitely getting that.

And if you look at the -- what we think is particularly amazing about the line graph is what I'm looking at currently, is you start to see the separation by week 8, you see the space between the gray line and the orange line, which is XOLAIR versus the 4-milligram group. And that area under the curve is really quite striking. If you follow the gray line, which is omalizumab from the last dose, which is week 16, sort of -- and follow your eye down to the week 30 time point and extend that line, you can really see how that continues to degrade towards the placebo line.

There was maybe one subject that sort of even off drug at that period of time, spontaneously improved, which happens in this disease state and certainly happens with small numbers. But you can see how that's degrading towards placebo, which you expect 5 months off of drug. What was surprising was the durability of the 4-milligram group off of drug. Again, as Dominic pointed out, sort of same milligram dose level, therefore, same molarity because they're both monoclonal antibodies, same sort of number of half-lives off of drug, which is like 4 to 5. So the drug itself should really be gone. And yet the effect is still there.

And so it tells us that there's something fundamentally different in terms of the biological effect that's happening in those outer weeks between omalizumab and 221. And for us, given that 221 was engineered specifically with a second mechanism, our assumption at this point is that, that's that second mechanism in terms of synthesis of new IgE that's kicking in. And one can imagine then, for instance, that over time, if you are, in fact, effective against -- again, turning that spigot off that, that -- and decreasing free IgE over time that, that may actually cross 0 at some juncture and modify the way that you approach the dosing of the disease itself as well.

So you can think about mechanistically things like total IgE and receptor engagement on the effector cells or the high affinity receptor, really downregulating those receptors and making those effector cells more quiescent over time. And then you can think about also turning off the synthesis of new IgE and reaching some sort of steady state that fundamentally is disease-modifying for these patients. And so that's what we're going to explore at a bare minimum, purely clinically. All of the scientific hypothesizing aside, the bottom line is that we have remarkable clinical difference here that we think is meaningful for patients and pointing to the fact that this molecule is providing a new tool by which we can approach getting more for each of these patient types.

That was very thorough. And I think the IgE data also will help as that becomes available. I was just -- maybe my follow-up was, do you have baseline IgE data? I didn't say -- didn't see that in the table. And I was also asking that in context of CSU, the range is very narrow, in the 100 sort of range. But with food allergy, the baseline IgEs can be much higher. So if you could maybe comment on how you're thinking of what the induction maintenance paradigm, some of it, I know you commented, but what high dose levels you could go there just because of where you're starting with your IgE levels? And how does the data here inform how you kind of progress in CSU versus food allergy?

Yes. Thank you for that, Mayank. I mean I think we're very excited to be able to provide specific IgE, PK response data and modeling associated with that and how we're thinking about that relative to each of these disease states, as we said at a future scientific meeting. And that's not us being coy, to be clear. We have the clinical data at this juncture. We definitely wanted to make good with our promise to provide data by the end of the third quarter, which is what we are delighted to be able to do at this time. And those data otherwise are just not available at this juncture.

But the way I think about this, and obviously, it would be a tremendous grand slam to have both of those pieces together today and tell you the other piece of the story. But the way I think about this certainly as a clinician and a drug developer is if I had the bioassay data today, I would be asking myself, yes, but is it clinically relevant, what does it really mean clinically? And that's really ultimately the takeaway.

And I think that we're incredibly fortunate to have very clear clinical data despite the relatively small numbers. I mean, it's a Phase II trial. It's not tiny, but it's also not massive. And to get the kind of clarity across endpoints, the kind of statistical significance that we're seeing with these numbers, we're very pleased by. We think it's very clean and very consistent. And it's telling us that there's something different. And we can argue about what that thing might be, but we think the most likely -- Occam's razor and all, we think it's most likely the thing that it was engineered to do. And so more to come there.

Makes a lot of sense. And if I could -- final, final question. ADA formation, anything on tolerability on immunogenicity, if you could comment because that obviously is relevant as you develop this in subcu format. And I know there was one patient in your Phase I that had nausea, headache. Just clarify if you've not seen any of that.

Yes. And I apologize, Mayank, I didn't quite hear the first part of your question, but I'll go ahead and address the second part, which is from a safety perspective, we feel very, very good about the profile. You saw the table with all the zeros all over it. There hasn't been anything. And that subject in the Phase I, I think it stated clearly in the supplemental as well, it was not deemed to be related to study drug, if I recall correctly. And...

Sorry, the first part was about ADA or any immunogenicity comment...

Yes. I mean, like PK, like IgE, ADAs are also things that are -- these are things that require assays to be run. And with typical studies, and this is not specific for this particular study, we'll batch them at the end so that they're all run at the same time, which eliminates some variability associated with them and some noise. And so they typically come after the clinical data. And that's what you're seeing here.

Our next question in the Q&A queue coming from the line of Dev Prasad with Lucid Capital Markets.

Congrats on the update and data. I have a couple of questions. One is, so if we look at week 12, the 4 and 2 mg per kilogram dose are nearly identical at 54% and 53% for HSS7, but they are substantially different at week 28 at 60% and 31%. How do you interpret that pattern pharmacologically? Does this suggest 4 mg per kg crosses an exposure threshold required for durable expression? Or is it just accumulation? And one question on planned Phase IIb/III design. Are you aiming to demonstrate superiority over placebo or over omalizumab or both?

Yes. No, great question. And maybe I'll take the second question first, which is, are we planning to design a head-to-head trial, I think, is what you're asking us. And I think that's to be determined. We'll -- I think we had shared previously that we -- based on the Phase I data and what we were seeing relative to a single IV dose really having a very prolonged effect on suppressing IgE a bit below limit of quantification that we were especially interested in this molecule and its potential in food allergy because it's such a strictly IgE-mediated disease. So it seemed like the perfect place for something like this. We now feel sort of doubly excited about food allergy as a result of that.

We also always stated that CSU is a more complex disease, has lots of potential mechanistic aspects that are involved in the disease state. And so how much more we would get with better IgE coverage was an unknown, and we would commit to CSU if it had the potential to be differentiated. I think that what we're seeing with these data, we feel, again, very clean, very consistent dose response is statistically significant and the line graph really kind of says it all in terms of the difference between those curves, not just at 1 point, but across the experience of what these patients are achieving and then a durability 12 weeks thereafter.

So with these data, we're committed to the Phase IIb/III for CSU. Some of the things, as I sort of shared with Maury earlier as well is in terms of exactly what those dose levels will be and whether we'll run an active comparator in a head-to-head fashion, I think, is TBD as well.

Yes. Maybe to your -- to the first part of your question about the differences or potential differences between the 2 mg per kg and the 4 mg per kg dose. And so you're correct that there is a slight difference at week 22, but that may not be where it's the most relevant to look at it. I think we can agree, for example, when we look at Slide 16, that these 2 dose levels seem to behave somehow similarly at week 12 and -- but maybe with some slight separation at week 22. What we think is really relevant is to look at week 28 after dose. And that's where maybe we start unmasking this second mechanism by the fact that we are, at the 4 mg per kg dose, really seem to have done something in excess of the 2 mg per kg.

And maybe to add on to that, just to reiterate that, that isn't an exposure issue. Because, again, these are antibodies that are -- have a regular monoclonal antibody half-life of 2 to 3 weeks. And so we're 4 to 5 half-lives out at week 28. We don't expect a lot of drug around. So it's less about an exposure issue in our minds and more likely a biological threshold of effect. And we obviously are biased, given, again, the design of the molecule to have one explanation for all of this, which is we know we were designed to turn off -- to have the potential to continue to utilize the natural mechanism to dampen new IgE synthesis.

We think as the total IgE complexes are formed, as they stabilize as a total IgE complex, we have the benefit not only of sopping up the IgE, preventing it from binding to the high affinity receptor, but also utilizing that complex to be a high IgE state, if you will, and dampen new IgE production. And it's not sort of unreasonable to think that, that has a threshold associated with it.

So very excited for CSU patients. We think for food allergy patients and then, frankly, the CSU study being a complex disease and having this kind of effect gives us enthusiasm for other disease states like atopic dermatitis, allergic asthma, et cetera. So sort of more to come as we continue to explore the biology and think about our study designs moving forward.

Thank you. And there appears to be no more questions in the Q&A queue at this time. Ladies and gentlemen, this does conclude today's conference call. Thank you all for your participation, and you may now disconnect.

Good morning, and welcome to the Cue Biopharma Virtual R&D Day. [Operator Instructions] Today's call will focus on a review of Cue Biopharma's lead asset, CUE-401 in development for the treatment of autoimmune and inflammatory diseases. Joining me on today's call is Cue Biopharma's Interim President and Chief Executive Officer, Lucinda Warren; Chief Development Officer, Dr. Daniel Baker; two recognized researchers in T regulatory cells and cytokines, Dr. Richard DiPaolo and Dr. Jonathan Kay, and other members of Cue's management team.

Please note that this presentation and discussion is being recorded and will be available under the Events in the News and Publications section of the company's website at cuebiopharma.com. The webcast will be archived for the next 30 days.

Additionally, some of the statements we make on this call will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those stated or implied by these forward-looking statements due to important risks and uncertainties associated with the company's business, including those set forth in the Risk Factors and in Management's Discussion and Analysis of Financial Condition and Results of Operations section of Cue Biopharma's annual report on Form 10-K for the year ended on December 31, 2025, filed on March 16, 2026, and any other filings that we may make with the SEC.

In addition, any forward-looking statements represent our views as of today, April 7, 2026. Cue undertakes no obligation to revise or update any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise after the date of this conference call.

Now I would like to hand the call over to Cue Biopharma's Interim President and Chief Executive Officer, Lucinda Warren.

Please go ahead, Lucinda.

Thank you, Tara, and good morning, everybody. Welcome to Cue Biopharma's Virtual R&D Day event. The agenda for today's call, as shown here on Slide 3, will focus on highlighting the significant potential of our lead asset, CUE-401, a potential first-in-class bifunctional molecule, leveraging both TGF-beta and IL-2 pathways for treating autoimmune and inflammatory diseases. I'll start by providing an update on our current pipeline as well as milestones achieved and upcoming. I'll then turn the call over to Chief Development Officer, Dr. Dan Baker, who will discuss the unmet need that CUE-401 aims to solve in autoimmune diseases as well as its differentiated design and demonstrated mechanism of action.

He'll also share promising data in multiple animal and in vitro studies. In addition, we have two immunology key opinion leaders joining us on today's call. Following Dan Baker, Dr. Rich DiPaolo, a leader in regulatory T cells, will share his perspective on CUE-401's mechanism of action for generating Tregs through the co-delivery of TGF-beta and IL-2, including in vivo data generated from his lab from an autoimmune gastritis disease model. Following Dr. DiPaolo, Dr. Jonathan Kay will share his perspective on the relevance of cytokine reduction in autoimmune disease and 401's ability to dampen inflammatory responses beyond enhancing immune regulatory mechanisms.

Dr. Kay has three decades of clinical experience treating the broad spectrum of rheumatic diseases. And as a practicing rheumatologist and immunologist, he will discuss the potential of CUE-401 to change the treatment paradigm for patients suffering with autoimmune diseases. We'll then conclude with a question-and-answer session, which will include members of the Cue management team. And finally, I'll conclude the call with a few closing remarks.

Before moving into CUE-401, which is the focus of today's call, I want to provide a quick overview of our current pipeline and upcoming milestones. Our lead candidate and primary business focus is CUE-401, a first-in-class bifunctional molecule, leveraging both TGF-beta and the IL-2 pathways. We have completed manufacturing and IND activities and plan to file an IND in this second quarter and then move to initiate a Phase I trial. We believe that CUE-401's mechanism of action presents tangible benefits and a novel potential, which we're excited to dive into today.

CUE-501, which was licensed to Boehringer Ingelheim last April, represents a monetized asset with significant value. The agreement included up to $345 million in potential milestone payments, along with meaningful commercial upside. And I'm excited to share with you today that this morning, we announced that the first preclinical milestone of this collaboration has been met, and Cue will receive $7.5 million. Importantly, this partnership also helps derisk and validate the broader CUE-500 series for which we retain full rights outside of B-cell depletion. Our CUE-100 series was licensed to ImmunoScape at the end of 2025, allowing Cue to focus on our autoimmune disease programs while continuing to advance the Immuno-STAT platform for oncology with ImmunoScape. The CUE-100 series represents another monetized asset for the company. This agreement included a total upfront payment of $15 million, along with high single-digit royalties on future sales.

And in addition, Cue received a 40% equity stake in ImmunoScape. Further aligning long-term value creation. ImmunoScape continues to make progress through potential IND submissions for additional trials in 2027. As a reminder, previous Phase I clinical data sets generated by Cue demonstrated clinical activity of several CUE-100 series candidates in multiple metastatic cancers without the significant toxicities that are often caused by traditional immune activating IL-2 delivery. Importantly, the CUE-100 series has been foundational to the evolution of our platform, including the CUE-500 series and CUE-401. Various key functional components of the CUE-100 series have been deliberately incorporated into these subsequent programs to enable specific mechanistic properties in these molecules. I'm excited to be driving this next stage of growth for Cue alongside other seasoned members of our leadership team.

Now I'd like to hand the call over to my colleague, Dr. Dan Baker.

Dan?

Thanks, Cindy.

So to set the stage for a review of the potential of Cue's platform in autoimmune diseases, let me highlight a few aspects of the pathophysiology of these conditions. In healthy individuals, the immune system maintains tolerance using the regulatory function of T cells, in effect, T regulatory cells or Tregs. Autoimmunity occurs when the immune system begins to recognize self-antigens as foreign and an inflammatory reaction against those antigens occurs. Loss of tolerance usually occurs when Tregs either function poorly or are reduced in number or both. The resulting inflammatory process can further suppress Treg function and exacerbate the autoimmune condition in a cyclic fashion as the inflammation spreads and intensifies. CUE-401 was designed to restore tolerance in autoimmune diseases by suppressing autoreactivity in several ways, both by directly inhibiting inflammatory pathways and enhancing T cell regulation.

Next slide. Our molecule 401 was designed to address the challenge of restoring tolerance and controlling autoreactivity by directly modulating autoreactivity at its core. CUE-401 is a highly differentiated bifunctional cytokine therapeutic, leveraging a unique TGF-beta component in combination with a modified interleukin 2. The supporting evidence behind CUE-401 is the findings of researchers such as Sakaguchi, DiPaolo and others that demonstrated that concurrent signaling through IL-2 and TGF-beta receptors and recently activated T effector cells induces and stabilizes FOXP3 and therefore, converts autoreactive effector cells into autoprotective T regulatory cells. In effect, reducing pathologic inflammatory cells while markedly increasing tolerogenic antigen-specific Tregs; however, we were also determined to understand the direct effects of CUE-401 on other inflammatory immune cell types that express both receptors, which would allow CUE-401 to provide additional support for the Treg response by directly reducing inflammation. Parts of this data will be presented today.

While TGF biology is pretty well understood, its therapeutic potential has remained largely untapped for several reasons: poor pharmacokinetics, off-target toxicity and poor manufacturability. Thanks to the innovative design of our protein developed by our engineering team, we've overcome these limitations. To improve the PK, CUE-401 is built on a sophisticated knob-and-hole Fc backbone structure that combines TGF-beta component with an IL-2 element, both of which have been attenuated. As you will see, alone, these cytokines bind poorly to off-target cells such as fibroblasts. However, not only does the design improve PK, but also promotes concomitant binding to both receptors. In addition, the design allows the avidity that results when both receptors are engaged, allows a biased binding to immune cells that express both TGF and IL-2 receptors.

This delivers minimal but sufficient concurrent signaling to achieve the desired biologic effect without overstimulation. It should be noted that recombinant TGF-beta is very hard to produce at clinical scale since it is toxic to the cells that produce it. This toxicity results in very poor yields. In order to improve the manufacturing capability, CUE-401 also incorporates a masked version of the TGF-beta receptor that prevents toxicity to producer cells, allowing efficient and productive cell lines. We will discuss the mask in more detail in the following slides. The IL-2 component is well validated. The extensive clinical experience in over 150 patients as part of our clinical trials with the CUE-100 series. IL-2 plays a critical role in promoting the generation of regulatory T cells. When combined with TGF-beta signaling, this approach not only expands natural Tregs, but also drives the formation of induced antigen-specific memory Tregs from cells that would otherwise become inflammatory autoreactive cells. Mechanistically, this creates a powerful trifecta of effects that builds on IL-2-based approaches.

As we have discussed, by incorporating TGF-beta in combination with IL-2, CUE-401 unlocks additional mechanisms to regenerate tolerance by generating induced Tregs with specificity. In addition, CUE-401 directly suppresses T effector function and cytokine production, NK cell activity and suppresses pathologic B cell functions. Together, these mechanisms position CUE-401 to comprehensively rebalance the immune system in a targeted and highly effective way. This slide describes the attenuation of cytokine affinities for both TGF-beta and IL-2. The red line represents CUE-401, while the black lines show the unmodified molecules. The attenuation for both is up to 10,000 fold and so enhances safety by reducing the potential of off-target effects on nonimmune cells while preserving some targeted biologic function. The safety and efficacy of CUE-401 have been demonstrated in multiple animal models and toxicologic studies.

Additionally, the function of the mask has been confirmed since CUE-401 has successfully completed production of 2,000-liter batches using a master cell bank with a production titer of approximately 8 grams per liter. And the half-life of CUE-401 in nonhuman primates is about three days, but the PD effect, i.e., the number of Tregs lasts much longer, allowing for intermittent therapy. On the left, this slide emphasizes the benefit of coupling TGF-beta with IL-2 and how the mask works. The mask is a shortened and attenuated TGF-beta 2 receptor that covers the TGF-beta on CUE-401 when it is in its soluble form. Importantly, the interaction between the receptor mask and the TGF-beta on CUE-401 is attenuated so that it has a lower affinity interaction compared with the binding of TGF-beta to the wild-type receptor on the cell surface. As a result, when CUE-401 encounters the wild-type TGF beta receptor on the cell surface, the mask can open and allow the TGF-beta and CUE-401 to bind and signal through that higher affinity interaction with the normal TGF-beta receptor.

It is important to note that despite the attenuation of the individual components, the ability of CUE-401 to bind to both IL-2 and TGF-beta receptors concurrently results in avidity, so there is increased functional affinity at the cell surface. Thus, the innovative design allows preferential binding to immune cells containing both IL-2 and TGF-beta receptors while avoids off-target binding. On the right, we emphasize the difference between CUE-401 and simple IL-2-driven Treg expansion. As noted previously, immune tolerance to self-antigens is primarily maintained by the body's regulatory T cell system. Bluestone and others have suggested that a strong inflammatory environment can destabilize Tregs and convert them into pro-inflammatory effector cells. So efficient restoration of immune balance, therefore, requires both induction of Tregs and suppression of effector T cell-driven inflammation. The uniqueness of CUE-401 lies in its multiple mechanisms of action.

As you will hear from Dr. Kay, CUE-401 suppresses T effector function and has direct anti-inflammatory effects, targeting multiple components of the inflammatory cascade. This combination of mechanisms makes CUE-401 a powerful tolerizing agent. How do these findings translate into in vivo models? The next part of the discussion will emphasize the effect of CUE-401 in, in vivo biology. We evaluated CUE-401 both in vitro and in vivo across multiple clinical models -- preclinical models of autoimmunity. In all studies, the molecule consistently modulated immune responses as expected, suggesting potential applicability across multiple autoimmune indications. This slide demonstrates the effect of three early doses of CUE-401 on survival in a model of graft-versus-host disease. On the left, you can see that with just three doses of CUE-401 given early in the experiment. As shown in the blue line, 50% of animals survived out to the last evaluation at day 95, while as seen in the purple line, all the control animals died by day 62.

The CUE-401 treated animals showed the expected increase in Tregs in the spleen and other targeted tissues, as shown in the middle graph. Of interest, as shown on the far right, donor human T cells survived out to day 95, indicating the generation of tolerance of those cells to the host. Here on the left, we see how CUE-401 extends disease-free survival in a commonly used model of multiple sclerosis. The blue line reflects the survival of animals treated with CUE-401 and is compared with animals treated with vehicle in purple. In this model, generation of Tregs and suppression of relevant cytokines were demonstrated as well as the increased survival. On the right, we show suppression of T cell-driven inflammation in a model of delayed-type hypersensitivity. In this model, only a single dose of CUE-401 was administered on day 1, as shown in blue and was compared to daily treatment with the immunosuppressant cyclosporine shown in yellow.

A single dose of CUE-401 was as effective as cyclosporine in suppressing immune activity in this model. So let me now introduce Dr. Richard DiPaolo, Professor and Chair of the Department of Molecular Biology and Immunology at St. Louis University. Dr. DiPaolo will share some of his data demonstrating the biologic activity of CUE-401. For those of you who are interested in more detailed experimental methods and data, these can be found in his manuscript, which is recently updated to bioRxiv.

Rich?

Thank you, Dan.

Good morning, everyone. Today, I'm excited to share our work on a fundamental question in immunology. How can we selectively activate and stabilize regulatory T cells or Tregs in vivo without broadly stimulating conventional T cells. This question sits at the heart of treating autoimmune disease, transplant rejection and chronic inflammation. And while we've known for years that IL-2 and TGF-beta are essential for Treg biology, coordinating these signals pharmacologically in vivo has remained a major challenge. This work represents a collaboration between members of my lab at St. Louis University and the folks at Cue Biopharma. Autoimmune diseases arise when peripheral tolerance breaks down. Regulatory T cells play a critical role in maintaining this tolerance, but selectively activating them in vivo has remained a major challenge. Although IL-2 and TGF-beta are both essential for Treg biology, delivering these cytokines in a way that specifically activates Tregs has proven difficult.

The rationale for combining IL-2 and TGF-beta is well established. IL-2 promotes STAT5 activation and supports Treg activation and survival, while TGF-beta induces SMAD signaling drives FOXP3 expression and stabilizes the Treg lineage. In vitro, the combination of these two cytokines efficiently generates potent induced Tregs. However, translating this approach in vivo is challenging due to their short half-lives, potential toxicity and the difficulty of ensuring coordinated delivery to the same cell. To address this, a strategy was needed to deliver both signals simultaneously to individual cells. CUE-401 was designed to overcome these limitations. Now I'd like to introduce CUE-401. CUE-401 is an Fc-based fusion protein that links an attenuated IL-2 to a receptor masked TGF-beta3 variant. Both cytokine components are human-derived and cross-react with mouse receptors. The IL-2 mutein is engineered to reduce off-target activation, while the masked TGF-beta3 prevents constitutive signaling.

This Fc scaffold enables coordinated cell-associated delivery of both signals, extends the molecule's half-life and enhances manufacturability. In terms of mechanism of action, the combination of attenuated IL-2 and the masked TGF-beta3 creates a coordinated signaling environment that's hypothesized to induce a distinct regulatory program, one that preferentially supports Treg expansion and function while limiting effector T cell activation. In the next few minutes, I will highlight key results demonstrating the biological activities of CUE-401. And for those that are interested in a more detailed experimental methods and data, these can be found in a recently updated manuscript to bioRxiv. In vitro, extensive testing of CUE-401 produced three major outcomes. First, it induced FOXP3-positive iTregs from naive FOXP3 negative CD4 T cells at very high efficiently. Second, it expanded endogenous Tregs that maintained FOXP3 expression.

And third, it reprogrammed effector memory T cells towards a less inflammatory state, reducing cytokine production. Next, we tested the activities of CUE-401 in vivo. A single dose of CUE-401 expanded Tregs dramatically 6 days post administration from about 20% to over 60% of the CD4 T cell compartment. Importantly, this expansion was selective. Conventional CD4 T cells showed minimal activation. We next test whether these Tregs were stable. Sorted CD4 positive, FOXP3-positive Tregs from CUE-401 treated mice showed full demethylation of the FOXP3 TSDR, identical to natural Tregs.

Furthermore, they maintained FOXP3 expression even after reactivation for 7 days in vitro. This indicates that CUE-401 expands lineage committed stable Tregs. These Tregs weren't just stable, they were activated. Multiparameter flow cytometry showed CUE-401 expanded Tregs expressed higher levels of CD25, CTLA-4, GITR, CD103 and Ki-67 compared to Tregs from vehicle-treated mice. RNA sequencing confirmed upregulation of several genes associated with Treg suppressive functions, including CD103, LAG-3, GITR, genes associated with tissue residency and genes associated with IL-2 responsiveness. This is a robust Treg activation program. To determine the role of TGF-beta3, we compare CUE-401 to an IL-2 only variant of CUE-401 without TGF-beta3. After a single injection, the IL-2 alone variant expanded Tregs, but failed to produce a subset of genes and Tregs compared to the TGF-beta3 containing CUE-401. Those are highlighted here in red.

Importantly, the IL-2-only variant also activated conventional FOXP3 negative CD4 T cells and induced proliferation and effector-associated genes like KLRG1, Ki-67, granzyme B highlighted here in blue, whereas CUE-401 did not induce these genes. Therefore, coordinated signaling of IL-2 and TGF-beta with the CUE-401 induced TGF-beta-dependent regulatory genes and Tregs and prevented effector activation, demonstrating that TGF-beta3 is essential for Treg selectivity. Next, we assessed CUE-401 in a stringent Treg deficiency model of autoimmune gastritis, including Treg depletion and cell transfer models that were also used in studies by recent Nobel Prize winner, Dr. Shimon Sakaguchi, to identify the role of Tregs in suppressing autoimmunity. Mice received CUE-401 only twice on days 1 and 14 after cell transfer. 60 days later, autoreactive T cells in the stomach were reduced from 44% to 10%.

Furthermore, disease scores, which assess the severity of inflammation and tissue damage were cut in half in mice administered CUE-401. In fact, some of the CUE-401 treated mice showed complete protection. This demonstrates that early administration of CUE-401 induced a durable immune tolerance long after treatment. To address the mechanism by which CUE-401 treatment was inducing immune tolerance in this autoimmune model, we performed single-cell RNA sequencing on immune cells from vehicle and CUE-401-treated mice.

This analysis revealed that Tregs in CUE-401-treated mice were present at twice the frequency, expressed higher levels of CD25, the high-affinity IL-2 receptor and expressed enhanced IL-2 STAT5 signature genes. They also express enhanced activation receptors like 4-1BB and survival genes like [ BCL-XL. ] These features suggest that early establishment of regulatory dominance in the autoimmune setting. To summarize, coordinated IL-2 and TGF-beta3 signaling with CUE-401 induces, expands and stabilizes Tregs, avoids effector activation and produces durable immune tolerance. This represents a pharmacologic strategy for in vivo Treg programming. We believe this approach has broad potential applications in autoimmunity, transplantation and chronic inflammation.

Lastly, I'd like to thank our collaborators and those of you listening today. And I'll now turn the call back to you, Dr. Baker.

Thanks, Rich. In addition, we are pleased to have Dr. Jonathan Kay with us today to discuss our findings in multiple relevant immune cell types. Dr Kay is the Timothy S. and Elaine L. Peterson Chair of Rheumatology at University of Massachusetts Chan Medical School. He is Professor of Medicine and Population and Quantitative Health Sciences. Take it away, Jon.

Thank you for the introduction, Dan. As you've just heard, we've demonstrated the powerful effect of CUE-401 on both the expansion of naturally occurring Tregs and the induction of stable antigen-specific Tregs, thereby restoring immune balance and enabling tolerance. However, it has long been known that TGF-beta can have tolerizing effects on multiple immune cell types, independent of Treg generation. We studied the direct effects of CUE-401 on a variety of other immune cell types, including conventional effector T cells, NK cells and B cells.

In the following slides, I will present data demonstrating that CUE-401 can inhibit the production of Th1, Th2 and Th17 cytokines and suppress both NK and B cell function. These immunomodulatory capabilities further differentiate CUE-401 from other IL-2 muteins and expand the potential of CUE-401 as a treatment for multiple autoimmune diseases. Cytokine release by activated T effector cells is a major component of the autoimmune response, not only inducing inflammation that causes tissue damage, but also suppressing the effectiveness of immunomodulatory cells such as Tregs. We hypothesized that the TGF-beta component of CUE-401 will directly suppress the production of pro-inflammatory cytokines by CD4-positive T effector memory cells in a dose-dependent manner.

To demonstrate this, human CD4-positive memory T cells were isolated from peripheral blood mononuclear cells and were stimulated with anti-CD3 CD28. The stimulated T cells were then restimulated either with one of several concentrations of CUE-401 or with an IL-2 mutein Fc fusion protein. After three days before the generation of Tregs, supernatants were collected and analyzed for multiple relevant cytokines that are listed on the right side of this slide. These include Th1, Th2 and Th17 derived cytokines. Here, we show data demonstrating that CUE-401 inhibits the production of a variety of Th1, Th2 and Th17 cytokines. The blue bars indicate levels of cytokines produced after restimulation with CUE-401, whereas the gray bars indicated cytokine levels after restimulation with an IL-2-mutein Fc fusion protein. CUE-401 clearly suppresses secretion of the Th1 cytokine interferon gamma, the Th2 cytokines, IL-4 and IL-13, the Th17 cytokines, IL-17, [ mutein-1 ] and IL-22 and GM-CSF and IL-6.

Since these assays were performed on supernatants collected three days after restimulation, which is before the generation of Tregs, these results support a direct suppressive effect of CUE-401 on cytokine production by T effector cells, whereas IL-2 muteins lacking TGF-beta are incapable of such suppression. Natural killer or NK cells play an important role in autoimmunity. NK cells are responsible for antibody-dependent cell cytotoxicity, which results in cell death and tissue damage. IL-2 alone induces NK cell proliferation and activation. Thus, without a counterbalance, treatment with IL-2 alone can result in unwanted effects of NK cells on the immune response.

Since TGF-beta is known to inhibit NK cell function, we designed two experiments to study the effect of CUE-401 on NK cells in vitro. In the first experiment, peripheral blood mononuclear cells were obtained from healthy volunteers and exposed to a range of concentrations of either CUE-401 or an IL-2 mutein Fc fusion protein. TGF-beta alone was not studied because IL-2 is necessary for NK cell survival. After 5 days, NK cell proliferation, NKp30 and NKG2D receptor activation and granzyme B expression were measured. Granzyme B is relevant because it contributes to barrier dysfunction and inflammation and its levels are elevated in a variety of diseases, including atopic dermatitis and psoriasis. The results of this experiment are shown in the graphs on the left in the middle of this slide.

At doses as low as 10 nanomolar, CUE-401 markedly inhibited both IL-2-induced NK cell proliferation and granzyme B production. In the second experiment, purified NK cells from healthy volunteers were incubated with either CUE-401 or an IL-2 mutein Fc fusion protein as in the first experiment. After 18 hours, the proportion of NK cells producing the cytokines interferon gamma and TNF was assessed. As shown in the graph on the right of this slide, CUE-401 resulted in a significant dose-dependent reduction in the proportion of cytokine producing NK cells. These findings support the conclusion that in contrast to simple IL-2-based therapies, CUE-401 promotes selective Treg expansion and should protect against the unwanted effects of NK cell expansion.

The important role of B cells in autoimmunity has been well described. We studied the effect of CUE-401 on B-cell differentiation and subsequent antibody production. B cells were isolated from healthy volunteers and activated in vitro followed by treatment with either CUE-401 or an IL-2 mutein Fc fusion protein. After 5 days in culture, the number of differentiated B cells were counted by FACS analysis. As shown in the graph on the left of this slide, CUE-401 had little effect on mature B cells. However, as shown in the middle graph, the number of B cells that were differentiated into plasmablasts was markedly reduced. In addition, CUE-401 markedly suppressed antibody production in these cultures, as is shown in the graph on the right of this slide.

These data support the conclusion that although CUE-401 has minimal effects on mature B cells, it suppresses the differentiation of plasmablasts into plasma cells, thereby reducing antibody production. These findings further support the potential for CUE-401 to both suppress ongoing inflammation and regulate overall immune balance. To summarize, I now return to the slide that I showed first. The ability of CUE-401 to suppress inflammation by inhibiting T effector NK and B cell function has unique implications for the treatment of autoimmune diseases. Although IL-2 by itself can stimulate proliferation of existing T regulatory cells and Tregs, it can also induce the proliferation and activation of T effector NK and B cells.

The additional TGF-beta signaling provided by CUE-401 not only stimulates proliferation of nTregs, but also promotes the transformation of autoreactive T effector cells into antigen-specific iTregs. By doing so, CUE-401 suppresses the activation by IL-2 of other cell types involved in autoimmunity. This broader suppression of the inflammatory response by CUE-401 both protects against tissue damage and enhances maintenance of cell tolerance by the T regulatory cellular compartment. I view CUE-401 as a unique therapeutic agent that combines TGF-beta and IL-2 signaling to both suppress inflammation and maintain cell tolerance by regulating immune balance. Thus, CUE-401 has great potential to treat the wide spectrum of autoimmune diseases and positively impact the lives of the many patients who suffer with these disorders.

Thanks. I will now turn the call back to Dr. Baker.

Dan?

Thanks, Jon.

Well, CUE-401 is rapidly approaching its first-in-human trial. All IND-enabling studies are completed, including the 4-week GLP toxicology study. The IND is in preparation for submission in June and the first-in-human Phase I program in healthy volunteers is scheduled to begin shortly after with results of the single ascending dose study expected the end of 2026 and the results of the multiple ascending dose study expected in the first half of 2027. This slide shows the design of the Phase I trials. The SAD study is a blinded, randomized, placebo-controlled trial, which will enroll 40 subjects over 5 dose levels as 5 cohorts. We will then move to the MAD study, also a blinded randomized placebo-controlled trial, which will enroll 32 subjects over two dose levels as part of four cohorts.

This trial will be pharmacodynamically marker heavy and will inform us about the best clinical doses that can be used in patient trials. Those trials will start rapidly following our understanding of the likely dosing regimens. So in closing, we believe 401 provides an opportunity to make a difference for patients with multiple autoimmune conditions. The choice of a lead indication will be made to provide early proof of concept while providing pharmacodynamic data that will inform dosing and the best fit for adjacent indications. CUE-401 may provide a unique paradigm of treatment options, both alone and in combination with other drugs. And let me say that the Cue team is very excited for the potential to bring life-changing therapies to patients.

So let me pass it back to Cindy?

Thank you, Dan. We'll now conduct a question-and-answer session with the management team who's currently on the line.

So we had a question come in, and I'd like to introduce Dr. Natasha Girgis, who's joined us as the Director of Translational Pharmacology. The question that's come in is about the TGF-beta mask. It seems to be a reduced avidity binder, not a true conditional mask that turns on in the presence of IL-2. Have you done -- what have you done to derisk the TGF-beta toxicity concerns at high enough doses?

Tasha?

Thank you, Cindy.

That's a great question. So there are a couple of points, I think, that are important to point out. First, that's correct. Our TGF-beta is a very reduced affinity binder to the TGF-beta receptor, and the mask is not conditionally activated by proteases or in specific tissues. That said, there are a couple of things that do derisk CUE-401 in terms of the risk of continuous TGF-beta signaling. First, the mask does significantly reduce affinity up to 10,000 fold, resulting in very attenuated TGF-beta signaling. Given the roughly 3-day half-life of CUE-401, this also means that direct TGF-beta signaling also occurs for a short period of time after dosing.

This is part of the reason the addition of IL-2 is important, and there are a number of reasons for that. IL-2 increases the avidity of CUE-401, which has the potential to bias binding of the TGF-beta component towards IL-2 receptor positive cells because that TGF-beta interaction on its own is so reduced in affinity. Second, because the combination of IL-2 with TGF-beta induces and expands Tregs, that allows for CUE-401 to be dosed intermittently as we've seen with other IL-2-based Treg expander approaches, most prominently Nektar.

And what that means is that TGF-beta signaling is not activated by CUE-401 for long periods of time. It means that when you induce and expand those Tregs, they take over immune control, allowing for intermittent dosing. In terms of derisking, we have performed multiple repeat dose studies in nonhuman primates with more intensive dosing than we're anticipating using in the clinic. And in these repeat dose toxicity studies in NHPs, repeated dosing with CUE-401 did not result in any evidence of organ fibrosis.

Great. Thanks, Tasha. So we have a question here for Dr. Jonathan Kay. From a rheumatologist standpoint, what would make this mechanism clinically differentiated versus existing immunology drugs, better durability, cleaner safety, steroid-sparing potential or activity in hard-to-treat patients. Where do you think CUE-401 can make the most impact?

Dr. Kay?

The mechanism whereby CUE-401 increases Tregs as well as converts the T effector cells into Tregs increases the efficacy. Certainly, this molecule is going to have tremendous effect in all autoimmune diseases by increasing immune tolerance. It certainly has potential to be steroid sparing as well as a direct therapy for diseases such as atopic dermatitis, systemic lupus erythematosus, inflammatory bowel disease, inflammatory arthritis. This unique mechanism certainly has potential to reduce toxicity and increase efficacy.

Great. Thank you, Dr. Kay.

So I have a question for Dr. Baker. The preclinical data shows that CUE-401 induces both natural Tregs and induced Tregs, which is the core differentiation from pure IL-2 muteins. How durable is this effect in your view after you stop dosing?

What we know is that the peak generation of iTregs -- of Tregs basically is about 7 days. Those Tregs stay around for at least 28 days and in PB -- in peripheral blood and may stay around longer in peripheral tissues. It's well known that it doesn't take a lot of specific Tregs to maintain a tolerogenic response. So we think that, that response will last up to months and will lead to some intermittent dosing.

Great. Thank you. So we had a question as well about the upcoming IND filing, how it's coming together. So I think that I can answer that one. As Dan had mentioned earlier, the IND-enabling studies have been completed, including the 4-week GLP toxicology, and we're preparing the submission right now for June.

So our first-in-human Phase I program in healthy volunteers is scheduled to begin just shortly after with the single ascending dose study expected to end at the end of 2026 and the multiple ascending dose study expected in the first half of 2027.

Let's see. We have one other question here. Perhaps Natasha, again, the TGF-beta component is the most novel part of the molecule. How are you thinking about its safety profile in humans?

Thanks, Cindy. So I think that also relates to the first question that I answered about derisking. So I think that it has the potential for an excellent safety profile for a number of reasons. It is highly attenuated. So keep in mind that wild-type TGF-beta is produced any time you have tissue injury or immune activation, and it's much more potent than our TGF-beta. The major benefit is that by combining with IL-2, we induce regulatory T cells for long-term immune control.

In terms of -- if we had to continuously agonize TGF-beta, I don't think that, that would be a very safe approach. But because we combine with IL-2 and both of the cytokines are extremely attenuated, we allow for immune control and suppression of inflammation over the short term and then induction of regulatory T cells for long-term immune control.

Does that answer the question?

Great. Thank you, Tasha.

So it looks like that concludes our questions. So I want to just thank all the participants of today's call, Dr. Jonathan Kay, Dr. Rich DiPaolo, Dr. Daniel Baker and Dr. Natasha Girgis. I also want to thank all of those of you who are listening in today's call and express my sincere appreciation and gratitude for your continued interest and support of our important work at Cue. Cue is committed to progress forward to help patients suffering from debilitating autoimmune diseases. So once again, I want to thank you all very much and have a pleasant day.