Enanta Pharmaceuticals, Inc. Stock

Welcome, everyone, to the 44th Annual JPMorgan Healthcare Conference. My name is Anupam Rama. I am one of the senior biotech analysts here at JPMorgan. I'm joined by my squad, Rati Pinge, Priyanka Grover and Joyce Zhou.

Our next presenting company is Enanta, and presenting on behalf of the company, we have CEO, Jay Luly.

Thank you, Anupam. Before I begin, I want to remind you, I'll be making some forward-looking statements. For a summary of the risks associated with these statements, please see our filings on sec.gov and on our website.

For those of you who are less familiar with Enanta, we are a virology and immunology company. Our roots originally were in virology and even deeper in hepatitis C, in the early days of hepatitis C, where we helped bring forward two products with AbbVie to market. Our key program there was hep C protease. And we invented glecaprevir, which is a part of the hep C drug called MAVYRET, which has cured well over 1 million patients chronic hepatitis C.

We moved beyond the liver virology several years ago and got into respiratory virology with RSV being our first target there. Viewing the high unmet need, the virus has been characterized for more than 6 decades. But to this date, nobody has brought forward a safe and effective treatment for the virus. More recently, there have been vaccines but even those have limitations and there's an incredible vulnerable population in the world that we aim to treat. So we'll spend a lot of time talking about that.

The pandemic broke out, we've also worked in COVID in protease inhibitors again. And then we began to branch out beyond virology in immunology. And in fact, just 2 years ago at this conference, we announced our first program in KIT inhibition. Last year, we announced STAT6 inhibitors. And this year, we are announcing a new program, MRGPRX2 otherwise known as X2. So we'll go through these in sequence.

Starting with respiratory syncytial virus. A lot of people only became more familiar with RSV after the pandemic, even though RSV has been around for a long, long time. But I think the acute awareness of respiratory infections became at the highest point during the pandemic. And then after the pandemic, when RSV and flu returned, there were big outbreaks. And ultimately, fits and starts in getting seasonality of RSV back, but it's been an endemic virus for, as I mentioned, decades.

Looking at the statistics from last year's -- the '24-'25 season in the U.S., there were up to 6.5 million outpatient visits, hundreds of thousands of hospitalizations and tens of thousands of deaths associated with RSV in the United States alone.

We're keenly focused on high-risk populations, people who will do more poorly if infected, they're the most vulnerable populations. And you can see those starting at both ends of the age spectrum, you have pediatrics that are vulnerable, you have elderly. And then you have other patient populations, people who have preexisting comorbidities such as COPD, asthma, congestive heart failure and, of course, the immunocompromised.

I mentioned vaccines have come forward in just the last couple of years. But the adoption really hasn't been very penetrating. It's probably estimated around 20% of the eligible population has been vaccinated, and that certainly lags things like shingles and flu.

Further, pediatrics have prophylactic monoclonal antibodies. They don't provide any long-term protection. They help during the first year of life. But then you're basically pushing the age for first, second and third infections to older children. And so we're seeing a shift now in the age of the first RSV infection to children who are not necessarily in their first year. But again, a number of people -- a number of children are still infected, you have breakthrough infections. And again, these prophylaxis don't offer durable protection. So there is a huge vulnerable population.

So I mentioned we're focused on high risk. We've reported out now two Phase II studies that were successful. The bottom one is in peds. We announced that one first in children down to as young as 28 days of age. I'll highlight some of the information from that study. And then more recently, late last year, we announced data of zelicapavir, our lead asset, in high-risk adults. And again, these were people who were over the age of 65, COPD, CHF or asthma.

So what were the results there. Again, we've published or we've presented the full study and those data are available on our website. But suffice it to say, we looked at this high-risk patient population very carefully. And it's in the patient population that I just mentioned, but we further had a prespecified population that was 80% of the study that had three high-risk factors -- one of three high risk factors in the study. So that was the so-called HR3 population. These were people who were 75 or older, people who had COPD, people who had congestive heart failure. And the idea was there to cap at 20% of the study, people who were young, otherwise well controlled asthmatics, people who were otherwise healthy, 65 to 74 years old, we really didn't want otherwise healthy people diluting out too much of the high-risk patient population.

So -- but what you can see is in the HR3 population, placebo had a time to complete resolution of all symptoms of -- on the order of 3 weeks. And zelicapavir shortened that time to complete resolution by about a week. So it was a remarkable result. We saw that across all 13 symptoms in the symptom tool we used and an additional 16 measures that were beyond symptoms, more lifestyle impacts.

So it was a very exciting study. And from that, not only did we see complete time shortening of the complete time to symptom resolution by the RiiQ symptom tool, there was another tool that we use called the Patient Global Impression of Severity. And that score was also a statistically significant improvement there, a 2-day shortening. And perhaps most intriguing was the lowering of hospitalization rate. In the placebo group, we had about a 5% hospitalization rate and that was reduced to about 1% on the drug-treated group. So overall, many signals lining up, many potential registrational endpoints and a very exciting outcome.

We also, of course, looked at virology, saw that in a very consistent, well-tolerated and safe profile that we've seen now in over 700 patients who have taken zelicapavir. So this data in the aggregate support advancement into Phase III in high-risk adults, and we'll talk more about that.

So here's the pediatric study. Again, we're treating children down as young as 28 days of age. So very young children. And for that, you want to be very careful, do a careful dose ranging, which we did. We looked at a lower dose and a higher dose. The key part was establishing that we had an antiviral effect. And we also began to bring on some symptom analysis in this study even though this study wasn't predominantly focused, it was more of an exploratory endpoint. And what we did see was some improvements on symptoms as well. So now we have looked at the pediatric population. We've looked at high-risk adult populations as well.

So this is the data on zelicapavir. We actually have another molecule that's sort of one stage behind zelicapavir. It's a different mechanism, an L-protein inhibitor. And we've talked about this in the past, so I will just summarize it on one slide here. But we had a very, very nice human challenge study with this, which is sort of a rite of passage for RSV agents. You want to be able to go into healthy volunteers who are infected with the RSV virus, and then who are then -- after the viral loads start to build up, they are then treated with drug.

And what we showed was a very high level of viral load reduction, 85% to 87% viral load reduction as measured by PCR. But if you go in and actually look at viral cultures in terms of the impact of knocking down the viral replication, in culture, we actually saw a 97% to 98% reduction in that. And not only that, but it was happening within 12 hours of the first dose. So an incredibly rapid acting agent. We also saw improvements in symptoms as well. So I think we have a good dataset here to support advancement of EDP-323 as a second mechanism into high-risk patient populations of one sort or another.

So let's shift gears to immunology. As I mentioned, on the left, 2 years ago, we announced we were beginning in this field. We announced that we would have a KIT program, again, this is a mast cell target focused on reducing mast cell numbers. It's a target that's been studied with monoclonal antibodies in chronic spontaneous urticaria and CIndU and some other mast cell-driven diseases. What we wanted to do was have an oral small molecule alternative to monoclonal antibodies and potentially something that could be dosed in a very straightforward way versus a monoclonal antibody, potentially with some advantages. And we set out the goal 2 years ago to have a development candidate in KIT rapidly, we now have one called EDP-978 that we're filing an IND on this quarter.

And then on the right-hand side, I mentioned a year ago, we announced our STAT6 program with the goal of having a candidate by the end of last year. We now have one of those. I'll talk about, called 3903. And then this year at the conference, we are announcing our third immunology program, again, with a target of having a development candidate in the second half of this year.

So each one of them is going after type-2 immune diseases, taking different angles, having multiple shots on goal. And in the case of STAT6 going after an oral DUPIXENT profile.

So let's start with KIT. Again, candidate 978 was selected. It's an incredibly potent molecule, both in vitro and in vivo. It's a kinase inhibitor. So you want to have selectivity. We've demonstrated very high levels of selectivity. And importantly, what we think are optimal in vitro and in vivo ADME properties. So once daily dosing, but yet controllable dosing and half life, et cetera, et cetera, to give you something that could be conveniently and maybe very targetedly dosed in this indication. So we're on track to file the IND in this quarter and report Phase I data with biomarkers out in Q4 of this year.

Shifting to STAT6. Again, the goal, in concept, is an easy one. We're trying to come up with an oral DUPIXENT. So DUPIXENT blocks the IL-4, IL-13 signaling at the beginning of the cascade. What we're doing is intervening a little bit downstream by blocking a transcription factor called STAT6. and blocking the activation of that will lead to the transrepression of a whole number of pro-inflammatory gene products.

So what we've done is selected the candidate. We announced it late last year, 3903, very strong potency in terms of nanomolar potency; highly selective, I'll show some data on that. And the key here is that we don't see pulsatile inhibition of this target. We see continuous and complete inhibition of this target. And I'll show some data as it relates to that, some animal models. Again, our -- we're on track to file an IND in the second half of this year.

And how do I know that we have sort of continuous inhibition? Here's the model. So you dose mouse in this case, with drug. You wait 24 hours so that the drug concentrations are at their lowest. You pull a blood sample and then you stimulate it with IL-4, and you ask the question, do you see phospho STAT6. And it turns out in the graph on the right shows the 24 hours post an oral dose, so at trough drug concentrations, you see complete inhibition, over 90% inhibition of phospho STAT6 induction. So that shows throughout the 24-hour period that we have coverage on that target.

We then moved into two different models of looking at efficacy versus dupilumab. And the first one is in atopic dermatitis model that is triggered basically by a vitamin D3 analog. It's a so-called MC 903 model, where you topically dose the animals with this vitamin D3 analog, it creates an atopic dermatitis-like state and then you can look at drug efficacy in that model.

And what you can see is that the drug -- the animal is dosed and then challenged in the air challenge model, and then there are lots of different readouts and different tissues you can look at. So we're looking at phospho STAT6 activation in the skin. What you can see in the panel on the lower left, is on the left-hand side of that graph is our compound, 3903, completely inhibiting the response. And on the right-hand side of that lower left panel is what dupilumab does, which is it inhibits the response as well.

So we're on par with dupilumab in that. You can look at spleen phospho STAT6 levels. Similarly, you can look at serum IgE levels. And in each instance, we're very completely inhibiting that response along the lines of dupilumab.

This is an asthma challenge model where, once again, you have transgenic animals with human IL-4 receptors. They are dosed with EPS-3903 and then they're challenged with house dust mites, which can induce an asthma-like condition. And so in this model, it allows you to interrogate multiple different compartments. We're looking at lung phospho STAT6 inhibition, and it's the same paradigm as the slide before. Our drug is on the left, we knocked the levels down below the quantitation level and similar to dupilumab. You can look at bronchoalveolar lavage fluid eosinophils influx and similarly, we knock it down similar to dupilumab. You can look at lavage fluid TARC, serum IgE, again, it's all very consistent, and we have histologic scoring beyond these data that we'll present at another opportunity, but the drug seems to work incredibly well in these preclinical disease models.

And this is just a cartoon, the last slide on STAT6, showing that EPS-903 has very good drug exposure. And that's why at the Cmax and the Ctrough, Cmax, Ctrough, as you dose continuously, the key thing is having those trough-level concentrations above the EC90 required for the response. And in that way, we can see the same sorts of effects as any degrader would. So we like small molecule inhibition. It's what we do. It's what we do well. We like the predictability of dosing PK drug-like properties that we know well from many other experiences.

So let's talk a little bit about X2. X2 is another mast cell target. It's expressed predominantly on mast cells, although we can see it on peripheral neurons as well. And agonism of that receptor leads to degranulation and a whole bunch of inflammatory release. And so it's yet another path to target the mast cell, gives us optionality in terms of multiple shots on goal in some of these mast cell-driven diseases. But importantly, it also gives us, to our growing armamentarium, an opportunity to begin to explore combinations of these agents such that we might see potentially even stronger efficacy than either alone, given the orthogonality of their mechanisms.

So just a little bit of evidence for X2, we'll call it, playing a key role in CSU. It turns out that patients with CSU have more X2-expressing mast cells. You can see that on the left panel. And they also have a greater response to X2 agonist of one sort or another in terms of being responsive. So it is -- it's a phenotype that is consistent in CSU patients and probably driving a component of that disease is X2.

So where -- our goal is to develop a really strong inhibitor here. We have prototypes that are very potent that block mast cell activation in a mouse model. They're highly selective for X2 versus other GPCRs. And as always, we're always trying to optimize ADME properties to support once daily dosing. So we're feeling good about our prototypes, on track to have a development candidate second half.

Just a little bit of data just shows the potency in the mast-cell cell line called LAD2, also primary skin mast cells, very consistent. And then the in vivo model is you take a mouse, they're injected with a blue dye and then you can come in cutaneously and stimulate with an X2 agonist and look for changes in vascular permeability that would be driven by mast cells. And that's what the panel on the right -- lower right shows that vehicle versus prototype just knocks that response straight down.

There are a lot of ligands that trigger X2. And what we like is whether it's neuropeptides some of the antimicrobial peptides, peptide hormones, we have a very consistent high level of potency against all these different ligands. So excited about the new program. We'll have a lot more to say, and we're on track to announce a candidate in the second half of this year.

So just to summarize, in virology, we're focused on really aiming for that Phase III. We're in -- beginning discussions with FDA around what the Phase III design would look like and the registration path. We expect to have that alignment done in Q2. We are preparing for a Phase III study in zeli. It's a seasonal thing, right? So you want to be ready to pull the ripcord when the virus comes. Usually starts to really come in earnest in Q4, but it could start in Q3. So we want to have the program enabled. We built up drug supply and trying to grease the tracks so that everything could be done.

And simultaneously, we're exploring BD opportunities in this RSV field, knowing that ultimately somewhere between now and commercialization. We want to have a commercialization partner who could really make an impactful launch with the -- what we believe could be the first-ever treatment for RSV and to do that on a global basis to get these vulnerable populations treated.

Immunology, just to summarize again, we're on track to file the IND for 978 in Q1, report Phase I data in Q4, STAT6 IND in the second half and then development candidate for X2 also in the second half.

So with that, thank you very much.

All right. I will ask the first couple of questions, but there will be opportunities for the audience to also get some questions in, if you have them, just raise your hand, and the mic will come or -- and/or I can repeat your question.

I wanted to start out with zelicapavir here. I know this slide says, hey, you're going to explore business development opportunities. But you also just now said you're going to need a partner at some point. So would you be willing to start a Phase III study after alignment with the FDA on your own?

Well, that's certainly in the constellation of possibilities. Again, I think anytime you have a dataset, you owe it to yourself to explore opportunities and see if you can find the right value and if you can find the right committed partner.

That said, this study is probably on the order of 500 to 700 patients. So it's not a huge study. And whether a partnership or not, we probably have one of the world's best teams in terms of knowing how to conduct these studies on a global basis. So we'll see how the path proceeds.

But it's a -- we also don't want to squander our leadership position here, right? The competitive landscape has fallen a bit to the side with some of the pharmas that we were working against stumbling last year, but we're not alone, but we are ahead. So I want to make sure one way or the other, this thing gets the development it deserves.

And with the Phase IIb zeli data in hand, how are you thinking about next steps for EDP-323 in RSV?

Tara, do you want to take that one?

Sure. Yes, as Jay said, I think with zelicapavir, we have the potential for a first-in-disease treatment for RSV. We're developing that in high-risk adults, also pediatrics are another high-risk group. I think EDP-323, we have challenge study data that probably is some of the best data, at least from a virology perspective that we've seen in a challenge study. So there is a potential for that to be a best-in-disease asset.

It seems like for the majority of patients, probably monotherapy, one agent would be sufficient. But there are situations where a combination might benefit, if you have a severely immune compromised or other sicker patients. So I think there's a lot of opportunities here and something where, again, as Jay mentioned, we want to maintain leadership in this space.

Questions from the audience? Maybe switching gears a little bit here. How are you thinking about STAT6 as a target post some recent competitor data? What gives you confidence in your oral small molecule approach, such as the one you have with 3903. And I think there's this view out there that, I mean, this has to be a target that's degraded, right?

Yes. Well, I think what I hope I have shown at least in the data, if you look at that -- I don't know if I want to go back to slide, maybe I'll click back just while I'm talking here. But it really comes down to -- well, this is a good cartoon. As long as you can -- it's with any drug target, right? So we come from a virology background where at trough concentrations of drug, you don't want the drug to not be there and have an effect because a virus can start to do mischief, right? It can start to mutate. You need to keep the pressure on 24/7. So we're used to putting high degrees of pressure on targets even at the 24-hour time point.

So as long as you do that, it's not mysterious. Even on the cartoon, the orange bit on the left here, as long as that trough concentration can be maintained above the EC90, you are going to -- you're going to see efficacy. And that's what this mouse study really showed that 24 hours after dosing, you take the blood out, you stimulate and you just -- you can't demonstrate activation because the drug is still inhibiting. So we don't believe you need to degrade the target, sort of take that nuclear option on the target. You don't have to do that. You can just have a straightforward inhibitor.

And then for the KIT program for EDP-978, just the final gating factors to getting that IND filed, but then what's going to be kind of the size and scope of the Phase I data that you're going to have in the fourth quarter? And what should we be looking for?

Sure. Yes, we're wrapping up the -- all the activities. It'll be filed in Q1, so very shortly. And then the Phase I will be a typical healthy volunteer SAD, MAD study. We'll be able to read that out in Q4 of this year. We will get a lot of information on sort of safety and tolerability profile, some PK to inform dosing.

And then the nice thing about this target and this indication is you can look at biomarkers like serum tryptase, which give you a really good idea of activity of your compound. So early on in development, we're able to get some target engagement and derisk the asset.

Questions from the audience? And then maybe a final one for me here, just on X2 program. I didn't want to say the whole thing, I just called it X2 because you did. So just on maybe expanding on why this target is so exciting to you? And then what are the kind of steps here that you're going through in your library to kind of get that development candidate nominated?

Yes. So I can come back to there's -- if we look at the slide where we have all three, it's one of the things where -- among the things I like about the setup is it's the sum of the parts, I think, is bigger than one could potentially think about from any of these alone because X2, you have -- the obvious ones are indications you could go after and sort of follow other mast cell-driven diseases, CSU, atopic dermatitis, asthma, CIndU and so forth.

But the other thing is these are -- the target is somewhat interestingly expressed on peripheral neurons, and there's a feedback loop between mast cells and neurons that can cause inflammation, and that has the potential in other things such as migraine, for example. So there's ways to think a little bit out of the box with some of these targets.

And like I said before, STAT6, we're going after a straightforward product profile of having an oral DUPIXENT. But could we begin to merge some of our other targets into some of these indications and do try to aim for even better than DUPIXENT efficacy with an all-oral approach. So we'll be -- we'll begin to explore that now that we have multiple tools. So just -- it's about optionality in some of these important disease areas where oral options don't exist.

Any final questions from the audience? Thank you, guys.

Thank you.

Thank you.