Nkarta Inc Stock

Good day, everyone. Welcome to Nkarta's webcast to review initial clinical data from the Ntrust program being presented at ACR Convergence 2026. [Operator Instructions] This call is being recorded. If you have any objections, please disconnect at this time.

I would now like to turn the call over to Paul Hastings, Chief Executive Officer of Nkarta. Please go ahead.

Thank you, moderator, and welcome, everyone. We're grateful you could join us this morning. I would like to remind everyone that today's call will include forward-looking statements, and actual results may differ materially. Please refer to the risk factors in our most recent quarterly report on Form 10-Q filed with the SEC for a discussion of the factors that could cause those differences.

Now, I want to open today by thanking our patients and their care partners for their trust and their participation in our study. Without them, the search for a better treatment wouldn't be possible. We are here for them and not the other way around. We're excited to be here at ACR Convergence in Orlando, where 2 world-renowned rheumatologists are presenting initial data for our investigational CAR NK cell therapy, NKX019. Dr. Guillermo Valenzuela, Founding Medical Director of Iris Rheumatology, shared our initial myositis data yesterday in an oral presentation. Our systemic sclerosis data will be presented in about 2 hours during a poster session by Dr. Dinesh Khanna, Director of the Scleroderma program at the University of Michigan. And on Wednesday morning, our overall safety data across all autoimmune indications will be the subject of another oral presentation by Dr. Valenzuela.

So here's our agenda for today's call. Shawn Rose, our Chief Medical Officer and Head of R&D, will walk you through the data. President, Nadir Mahmood will review market opportunities and provide an update on our cash runway. I'll come back for a quick recap, and then we'll open it up for questions. So this morning, we're presenting the first data from our autoimmune program in myositis and systemic sclerosis. These 2 indications will now be our sole focus as we work towards pivotal trials next year.

We will carefully follow the rheumatoid arthritis patients we've treated so far and have been encouraged by responses to date for safety and preliminary efficacy, along with patients enrolled with other indications. However, the focus of our time and resources now is on myositis and systemic sclerosis. We will revisit the other indications as time and resources permit. The bulk of our data we'll highlight this morning are from myositis and scleroderma patients with at least 90 days of follow-up, treated at the highest dose we've reached so far. That's 3 doses of 4 billion cells given on day 0, 3 and 7 for a total of 12 billion cells.

Now, at Nkarta, we've always believed the safety profile of NK cells would enable patients to receive cell therapy in a more accessible and convenient way. Our engineered CAR NK cells are administered on demand without apheresis in an outpatient setting without an overnight hospital stay, just a 2-hour observation period after each dose without the necessity for patients to travel hundreds of miles to a major academic center and without a hematology/oncology cell therapist needed to be on call in the event of a life-threatening immune reaction.

Also, our allogeneic CAR NK cells can be redosed, a key advantage over current autologous CAR-T approaches. Now, today, we will present proof-of-concept data for NKX019 in autoimmune disease for patients given a 3-dose cycle of cells following preconditioning. Now, the 3 things that stand out about the data are first, we're seeing a dose response in line with what you would see with a traditional small molecule therapeutic or biologic. Second, we're seeing impressive early efficacy in a range we believe to be comparable to what has been reported for CAR-T. And third, the safety profile of NKX019 remains highly promising and importantly, free of immune effector cell toxicities.

So to date, no CRS, no neurotoxicity, no IEC-HS and no GvHD. So before Shawn goes through the data, I want to talk about our ongoing dose optimization work and some key translational findings that are not reported in our data analysis today. The data we're presenting today reflects 3 infusions of NKX019 administered on days 0, 3 and 7 following preconditioning lymphodepletion. So the graph on the left shows NKX019 exposure and the dose response we've observed.

As you can see that each step-up in dose from 1 billion to 2 billion to 4 billion cells given on day 0, 3 and 7 produces a higher peak and a larger area under the curve. Now, the graph on the right shows host T cell levels recovering from lymphodepletion between day 4 and day 7. So looking back at the graph on the left, you'll notice that both peak levels and overall exposure from the final dose are reduced due to the return of those T cells. So in other words, today's data most likely reflect a reduced contribution from that third dose.

So to address this, we recently amended the Ntrust protocol to compress the dose schedule. We are now dosing patients on days 0, 2 and 4. This way, all 3 infusions are administered before those T cells recover. Compressing the dose regimen is also more convenient for patients. They can now complete a 3-dose regimen in 5 days. This is effectively dose escalation since patients to date may not have been getting the full benefits of that final dose. And as I said, we believe our early data in both myositis and scleroderma is comparable to CAR-T. We believe this data could improve further when patients get full exposure from all 3 of those doses.

Now, we also have the option under the Ntrust protocol to go to 6 billion cells per dose for a total of 18 billion cells, and we plan to exercise this option and enroll a handful of patients at the 6 billion cell level on the compressed schedule of day 0, 2 and 4. Why? Because our safety profile to date gives us that flexibility, and we don't want to leave any efficacy or durability on the table. Now, that's the advantage of having a cell therapy with a clean safety profile and a dose response. We owe it to ourselves and to our patients to enter pivotal development at the optimal dose.

And one final point that's important to address, it concerns the recent safety news from a competitor's trial, involving a different investigational NK cell therapy administered with fludarabine as part of the lymphodepletion regimen. Now, since fludarabine was introduced into Nkarta's lymphodepletion regimen, our program has had a consistent safety standard across all studies for patients that have kidney impairment.

Now, outlined in our protocol, patients with compromised kidney function are required to receive a reduced dose of fludarabine as part of their preconditioning. Furthermore, beyond a defined level of renal impairment, patients are not eligible to enroll in the Ntrust trials at all. So as I mentioned, our protocol also gives us the option to retreat patients, and we've retreated 3 patients in the study who did not respond to their first cycle of therapy. Each received a second cycle of lymphodepletion, followed by 3 infusions of 4 billion cells. That's a total of 12 billion cells per protocol. All 3 of the patients have been safely retreated to date with LD and cells with 3 months, 2 months and 1 month of follow-up, respectively. So we'll provide additional safety and preliminary efficacy data on these 3 patients in the near future.

Now, you'll hear more on this from Shawn, who will now take you through the initial data for NKX019.

Thank you, Paul. Good morning, everyone. It's a privilege to present these results. Let me begin by orienting you to the Ntrust study design. It reflects what Paul just described. NKX019 is dosed like a traditional biologic in the outpatient setting. Patients received 3 days of lymphodepleting preconditioning, followed by 3 doses of NKX019 via infusion. Dosing began at 1 billion cells per dose. Then the dose escalated to 2 billion cells per dose and then to 4 billion. Paul already covered our recent refinement of the schedule based on our translational findings and why we're exploring 6 billion cells per dose in preparation for pivotal trials.

Under our study protocol, we assess the response for up to 2 years and follow safety for up to 15 years. On the right are the endpoints. First and foremost, we evaluated safety and tolerability. In anticipation that fludarabine levels increase in patients with compromised kidney function, our protocol from the start has included a safety standard for patients with compromised kidney function. Patients with compromised kidney function are required to have a reduced dose of fludarabine as part of their lymphodepleting preconditioning. And beyond a defined level of impairment, patients are not eligible to enroll.

We also assessed NKX019 exposure and B-cell depletion and recovery, which allows us to determine whether we're achieving immune reset. For efficacy, we used established measures in each disease. In myositis, that's the total improvement score. TIS-40 is a moderate response. TIS-

60 and above are considered major responses. TIS-40 is our target because it is the ACR and EULAR-defined threshold for a moderate response. TIS combines muscle strength, patient and physician assessments and other disease measures. So a moderate response reflects broad improvement in the disease.

The criteria are now widely used as an endpoint in myositis trials, including trials that supported approval in dermatomyositis. We also measure MMT-8 for muscle strength and CDASI activity score for skin disease. In systemic sclerosis, we looked at changes in skin thickening with the modified Rodnan skin score or mRSS, and evaluated overall improvement using the rCRISS composite score. Because the disease affects multiple organ systems, rCRISS measures skin, lung function, physical function and the patients' and clinicians' global assessments. Here, we're aiming for rCRISS-25 or higher, which means at least a 25% improvement across multiple of those 5 domains.

A multi-domain response reflects a more holistic improvement in disease activity that could meaningfully advance care for these patients who are typically treated with therapies that target a single organ system or domain. As is common in trials for autoimmune disease, we strongly discourage the use of immunomodulators, but they are not prohibited in our protocol. Investigators may use them if they feel it's necessary. And where that happened, it's noted in the data. There is only one patient in the 4 billion cell dose cohort being reported today who received an immunomodulator after their first response without any retreatment.

With that framework in place, let's turn to the data. Let's begin with safety across all indications as of September 18 cutoff date. 40 patients across 5 autoimmune diseases received preconditioning with fludarabine and cyclophosphamide and at least 1 dose of NKX019. Overall, NKX019 was well tolerated and treatment-related events were mainly hematologic and attributed to lymphodepleting preconditioning. The safety profile was broadly similar across indications with cytopenias more frequent in the lupus nephritis group. That likely reflects differences in the underlying disease and in some patients, lower blood counts at baseline.

No immune effector cell-associated adverse events were observed across any indication or dose level. We saw no cytokine release syndrome or CRS of any grade, no ICANS, no IEC-HS and no graft versus host disease. The events associated with NKX019 administration were infusion-related reactions in 5 patients, all resolved within 24 to 48 hours without the addition of tocilizumab. That's a safety profile that makes outpatient administration possible.

Turning now to the myositis results. This slide shows the myositis patients treated so far. They had active disease that hadn't been controlled by prior therapy. Median disease duration was 3.5 years, but 3 patients had between 14-year and 30-year disease duration, 2 of them in the 4 billion cell dose cohort. Disease activity was clinically significant at baseline. Median MMT-8 measuring muscle strength was 117 out of a possible 150 and the range went down to 85, indicating substantial muscle weakness. Patients with dermatomyositis had active skin disease as well with a median CDASI activity score of 19.

These patients had already been through a lot of treatment. 9 of 11 or 82% had received 4 or more prior therapies. This is a population with refractory disease. This is the main efficacy readout in myositis, the total improvement score, or TIS, a composite score measuring overall clinical improvement. TIS combines muscle strength, patient and physician global assessments and other disease measures into a single score.

Starting with the graph on the left, 5 of 6 patients with at least 3 months of follow-up or 83% achieved a moderate or major response at the 4 billion cell dose level. As a former practicing rheumatologist, I can tell you these are the kinds of meaningful responses that matter to patients and their physicians. The responses you see here span 3 myositis disease subtypes. Dermatomyositis is an inflammatory muscle disease, typically with a characteristic skin rash. Juvenile dermatomyositis is the same disease with onset in childhood.

An antisynthetase syndrome combines muscle inflammation with lung disease and often arthritis. One of these patients, IIM3, who achieved a major response in the 4 billion cell dose cohort, has maintained it through 6 months. I also want to highlight IIM5. This patient had a major response early with a TIS response of 95, then contracted COVID-19 and dropped to below TIS-20. After recovering from COVID and a subsequent dermatomyositis flare, the patient received low-dose steroids only and has rebounded.

As of the September 18 ACR data cutoff, this patient had a TIS-40 response and continues to improve. As for the dose response curve, we see consistency and durability of response to date at 4 billion cells per dose. At lower doses, depicted in the graph at the right, we saw an early moderate response at the 1 billion dose level and a major response at 2 billion, but those responses were not sustained. You will notice that there are open circles at the later time points for the 1 billion and 2 billion dose patients. These represent additional therapies that these patients received for increased disease activity.

We also had 1 patient in the 4 billion cohort, IIM4, who received a low-dose steroid taper and IVIg from a community rheumatologist outside the protocol and without the investigator's knowledge. This was not because of disease worsening. The patient had already achieved a TIS-40 response at day 37 before any additional therapy began around day 50 and went on to a TIS-60 response by day 120. Muscle strength measured by MMT-8 tells the same story. Starting with the graph on the left, at the 4 billion dose level, 5 of 6 patients with at least 3 months of follow-up or 83% showed improvement in their MMT-8 score.

The gains appeared early and were maintained through follow-up. The one dip you see is IIM5, which coincided with the COVID-19 infection I mentioned previously. Now, an assessment of skin disease measured by CDASI activity score. At the 4 billion dose, 4 of 8 patients or 50% had clinically relevant reductions with several dropping to near 0. The other 4 patients remained relatively stable compared to baseline. The CDASI activity score spiked at day 90 for IIM5 during the COVID infection, and the score has since come back down.

Turning now to the systemic sclerosis results, starting with the patients treated. Our patients had long-standing disease and extensive prior therapy. Median disease duration was 4.6 years, with some patients up to 8 years from disease onset. Disease activity was substantial at baseline. On skin, median mRSS was 26 with a range up to 46, reflecting severe skin involvement. And these patients had already been through a lot of treatment. 9 of 14 or 64% had received 3 or more prior therapies. 86% had received conventional disease-modifying antirheumatic drugs or DMARDs, including mycophenolate mofetil in nearly 2/3 of patients.

This slide shows skin responses in systemic sclerosis. The graphs on the left show mRSS scores and the graphs on the right show percent change from baseline with the shaded area marking a 50% or greater reduction. Starting with the 4 billion cell dose at the top, we saw rapid and deep responses through day 90. Patients had a median reduction in mRSS of 15 points with reductions of up to 29 points. 6 of 7 patients or 86% had a decrease in mRSS. And these aren't small changes. 5 of 7 patients or 71% achieved an mRSS-50, a reduction of at least 50% from baseline. That goes well beyond a 25% improvement. There's also a clear dose response. Looking at the bottom graphs at 1 billion and 2 billion, we see only 1 patient of 5 patients reached a 50% reduction compared with 5 of 7 at 4 billion cells per dose.

Now, let's turn to the rCRISS composite score, which combines 5 measures: skin, lung function, physical function and patient and clinician global assessments. Lung function measured by forced vital capacity, or FVC, is a trailing indicator and can take longer to show a change. At 4 billion cells per dose, 6 of 7 patients or 86% achieved an rCRISS-25 or higher at day 90, which is our target and 5 of 7 or 71% achieved an rCRISS-50 or higher. One patient in the 2 billion cohort with the longest follow-up has maintained an rCRISS-70 response through day 270.

Turning now to the translational data. The data on this slide go beyond what is in the ACR myositis oral presentation and the scleroderma poster. They include all patients dosed at 4 billion cells for whom we have these data. Starting on the left, this is peripheral B-cell depletion in these patients who were dosed at 4 billion cells on day 0, 3 and 7. We see deep B-cell depletion with the majority of patients remaining depleted through day 27. What matters most is what happens next, and that's on the right, the B-cell profiles.

We have data from a small number of patients so far, but the pattern points toward B-cell reset. Memory B cells, switched memory B cells and plasma blasts fall and stay low, while naïve B cells return as the dominant population. This pattern is consistent with an emerging B-cell reset rather than B-cell depletion alone. To bring the clinical and translational data together, NKX019 was well tolerated in the 40 patients treated with a range of treatment from 0.3 months to 15.9 months and a median duration of 5 months.

There were no cases of CRS, ICANS, IEC-HS or GvHD, and we did not see an increase in adverse events at higher doses. In myositis, at 4 billion cells per dose, 5 of 6 patients with at least 3 months of follow-up or 83% achieved a moderate or major response by total improvement score or TIS. In systemic sclerosis at 4 billion cells per dose, 6 of 7 patients achieved an rCRISS-25 or higher by day 90 and 5 of 7 achieved an rCRISS-50 or higher. Across the program, we see a dose response. PK exposure increased with dose and the most consistent clinical responses were seen at 4 billion cells per dose. On the translational side, we see deep B-cell depletion with a shift toward a predominantly naïve profile among repopulating B cells.

Now, I'll turn it over to Nadir.

Thank you, Shawn. Refractory myositis and systemic sclerosis patients have limited to no therapeutic options and a severe need. We're pleased with what our early clinical data show that this therapy can potentially offer them, high therapeutic benefit, a very clean safety profile so far and importantly, convenient administration. On benefit, the responses Shawn just showed reinforce our belief in the impact NKX019 can have for these patients. That impact comes with a differentiated safety profile, free of immune effector cell toxicities to date. And it's off the shelf, ready to ship on demand and given in the outpatient setting with just 3 infusions within 5 days.

Feedback from the physicians treating these patients has been highly favorable. They're energized to bring their patients a therapy with high efficacy, a clean safety profile and operational ease. A product that delivers this kind of value should translate into a strong opportunity to help even more patients. Our preliminary U.S. estimates put myositis prevalence at about 80,000 patients, including roughly 7,000 cases that are refractory. Systemic sclerosis is about 90,000 patients, including roughly 10,000 cases that are refractory. We'll continue to refine these figures. Based on these estimates, together with feedback from payers and physicians on access and patient share, we see NKX019 as a therapy that could be widely prescribed across both indications in the U.S. That's the U.S. alone.

Europe represents additional upside that isn't included in these figures, and we're early in estimating the addressable patient population there. Here's what's next. Based on these data, we remain focused on advancing NKX019 in myositis and systemic sclerosis. In the first half of 2027, we expect additional follow-up in both indications and the plan to select the registrational dose, 4 billion versus 6 billion cells. We also have upcoming FDA interactions to discuss the registrational path in myositis and systemic sclerosis. And we're well funded to execute on that clinical development plan. As of our last quarterly update, we have $216 million in cash, cash equivalents and investments with an expected runway into 2029 based on our current operating plan.

Now, I'll hand it back to Paul.

So let me recap what we just heard. NKX019 was well tolerated in the 40 patients treated with no cases of CRS, ICANS, IEC-HS or GvHD. Our protocol includes a safety standard to reduce fludarabine-related risk for patients with kidney impairment, and we have not seen serious fludarabine-related toxicity. 5 out of 6 myositis patients achieved a moderate to major TIS response at 90 days. 6 out of 7 systemic sclerosis patients achieved an rCRISS-25 or better and 5 out of 7 achieved an rCRISS-50 or better at 90 days.

The duration of treatment across both indications is a median of 5.4 months with a minimum of 1.5 months and the longest follow-up is 12.6 months. At 90 days, the skin responses we see are some of the largest reductions reported in mRSS. We're also seeing durability at up to 9 months in one early patient who received a lower dose as of the September 18 data cutoff and preliminary B-cell profiling shows early evidence of immune reset.

Now, let me talk to you about one final point. We reported data today using traditional endpoints in myositis and systemic sclerosis, and we believe our data speaks for itself. Yet we also believe that cell therapy warrants a fresh look at scoring systems developed before next-generation disease-modifying therapies existed. That's why Nkarta is cosponsoring a companion study with Dr. Valenzuela called ACES to capture real-world patient-reported outcomes.

Now, the ACES study team is interviewing study participants before treatment and after they complete treatment via Zoom in the comfort of their own homes under a parallel study to our dose-escalation study. We'll update you on what we learned next year. The data we've shared today tell part of the story. The rest comes from the people who treated these patients and who saw the changes in them day-to-day. We're delighted today to be joined for the Q&A by Dr. Valenzuela, who is both an investigator in our study and a leading KOL in the field. He's past President of the Florida Society of Rheumatology, receiving his postdoctoral training in Rheumatology and Clinical Immunology at Cornell.

Now, as Founding Medical Director of Iris Rheumatology, Dr. Valenzuela has been a trailblazing community-based clinician running a community-based research center that, in my opinion, rivals or surpasses academic settings in conducting clinical research. His site has participated in more than 200 clinical trials, including multiple cell therapy studies in autoimmune disease. Dr. Valenzuela has been administering NKX019 on an outpatient basis from his community clinic in South Florida for several months.

Thank you, Dr. Valenzuela, for joining us. And moderator, we're now ready to take our first question.

[Operator Instructions]

Your first question will come from Gil Blum with Needham & Company.

Thanks for the very interesting updates. Maybe a quick question for Dr. Valenzuela. Just given we all saw the results today, what is your opinion on these results? And how would it apply to patients in your care?

Thank you for your questions. I think this is the first take of seeing patients in these conditions having alternative treatments that traditionally we haven't been able to offer to them. As you saw in the recent presentation, the responses of patients, in my view, exceed what we normally expect from the traditional therapies we've been exposed in the past. I have the opportunity to see these results in our patients directly in our clinic, and it's also replicated in other patients who are not part of my own cohort.

But I have a great motivation to continue seeing patients under this therapy because of the outcomes that we see, the personal expressions of our patients in the results. We have collected their experiences in different ways with their own personal statements that go beyond perhaps the metrics that you've seen here that are traditionally used to gauge the response of patients. So I see beyond the numbers, and I see patients having changes in their life, their statements and at a personal level, it is very gratifying as a treating physician to be a witness to their responses.

Okay. And as a follow-up, just given the risks associated with lymphodepletion and the potential for redosing here, what would you consider an appropriate durability for these kind of patients?

The durability is perhaps a difficult measure to predict, obviously. To the question of your -- of the lymphodepletion, you're probably relating to events reported before. But I don't think it's a changing event. I can tell you in our experience, all this -- and I want to remind you one important thing. All these treatments are provided in the convenience of an outpatient setting. In other words, our clinic has its own outpatient setting where these treatments are provided, of which conditioning lymphodepletion is one of them.

The process of administering the lymphodepletion and the subsequent days after that essentially are not a major hindrance or at all a hindrance to the patients other than the known mild side effects that they can have. So I don't have an issue in terms of the safety. I think the collective safety of this regimen far surpasses the risk that the therapy poses to the patients itself. Not only myself, but if you see across the cell therapy, fludarabine and cyclophosphamide are standard therapies, and they're very well tolerated in the majority of the trial.

So to summarize your question, I don't think lymphodepletion imposes any significant major hindrance. I think it's mostly the opinion of physicians who are not experienced to this. However, we've been educating our colleagues. In fact, yesterday, during our presentations, we showed we expressed, we shared our experience with lymphodepletion, and it seems to be very well taken once the community understands the implications of this treatment.

Yes, I think I would add to that -- Gil, it's Paul. I would add to that, that I believe the prevailing thought is that these therapies should have durability of about 12 months. And the option to retreat with NK cells is the benefit of the NK cell therapy. The ability to retreat if needed is there.

Okay. Dr. Valenzuela. And one for the company, Paul. So this one is for you. Out of those 40 patients that you guys reported, how many were treated as outpatient? I don't think I saw a specific number.

Shawn, I don't know if you know that number, what percentage it might be? The early patients.

I mean I'd say it's probably at this point, roughly half are outpatient.

Yes, just one addition. The outpatient therapy was a protocol amendment that was recently submitted and agreed upon with the FDA about roughly, what, 6 months ago.

Yes, 6 months.

Your next question will come from the line of Salim Syed with Mizuho.

Congrats on the data, guys. I'll just try to limit myself to one for the doctor, maybe one for the company. Dr. Valenzuela, in your view, could you just give us your updated thoughts just given the data that we saw this week and previously, where do you, at least on a preliminary basis, think NK cells for myositis and scleroderma could get slotted versus T cell products?

And then just for the company, on the registrational -- potential registrational start, Paul, or what are the gating factors here to actually starting the registrational trial? And is 2027 a reasonable estimate for that?

Thank you for your question. I think this is a question that I get also from our colleagues in the space in general. First, I see the NK therapy NKX019 specifically has a bright future in patients. And I would probably say the activity in early patients has a pivotal role. There are patients who, as we know, have a long journey, and we're trying to anticipate the chronic further progression of the disease by acting early and NK -- through NK, as you saw there and using the B-cell depletion and this data you're also seeing in the change of the behavior of the cells is very encouraging because it's essentially paralleling responses to CAR-T.

Now, I think the winning point as a clinician, for example, is how we apply these concepts into the administration of the treatment. And the great advantage is, as you saw in the presentation, is the safety profile, I would say, summarizing, you've already seen all those numbers. And second is the practicality of the whole process. I'm sure you're quite familiar with what the journey of a patient with CAR-T is. And I can tell you that the journey of a patient who receives NK is similar to the regular infusion therapy we have been traditionally providing for the last 20 years in our clinics.

Registrational. Yes, absolutely. So Salim, on the registrational end, our plan, even though we're now going to 6 billion cells, we feel that the 4 billion cell dose level is giving us very acceptable early preliminary exciting outcomes. The fact that we can go to 6 billion cells is because of the safety profile, and we don't want to leave anything on the table. However, we're prepared to discuss with the FDA very soon our pivotal plan. So your question about is 2027 a reasonable period of time in which we would do that and start trials? Yes, the answer is yes.

Your next question will come from the line of Phil Nadeau with TD Cowen.

Congrats on the data. Two from us. So Paul, just on your point about the 6 billion versus 4 billion dose levels that you just made. Can you tell us how you decide between those 2 doses? I guess, in particular, how much additional tox would you be willing to put up for -- put up with in the case of either better efficacy or longer duration of response? That's first.

And then second for Dr. Valenzuela. Could you give us some sense, as we look forward to pivotal trials, what is the minimum response rate that's necessary do you think to advance this to become part of the paradigm in either myositis or sclerosis? So what TIS moderate to major response rate or rCRISS-25 response rates will you be looking for in the pivotal study to think that this has a place in the treatment paradigm?

Yes. If you don't mind, Phil, I'll have Dr. Valenzuela comment first, and then I'll follow up on the response.

Well, thank you for your question. Moving into clinical trials, as you're asking, what would be an acceptable or a desirable response on our end? I would start to feel very comfortable if we are starting to reproduce what we just saw on the screen. Certainly, there's room for optimization, and I'm very encouraged. I have to step back for a second, I have to give you a bit of my background. I train in immunology. So one of the reasons why I follow this very closely these clinical responses is because I believe that the mechanistic effect of these cells is primordial.

So to your answer from the 4 billion to 6 billion cells, I believe there's still an additional room for -- following the PK curves that you saw on the previous chart, I think there's additional room for this treatment to be compacted and even more effective, having more available cells for doing their action. So in terms of response, I would be very happy to see results in the 50%s to 60% as you saw on the TIS scores, I think it's quite acceptable and sustainable. That would be a very elegant outcome where our colleagues will certainly feel very comfortable of trying to achieve themselves as well.

Yes. And we believe that between 50% and 60% is a rate that would be much better than what is available today and an acceptable rate. But we also agree with Dr. Valenzuela, reproducing these data would be actually spectacular. On the level of tox one is willing to accept, one would hope never to have to deal with toxicities and so far, we haven't, which is nice.

So the move to 6 billion cells in our opinion, is going to be carefully monitored. And given the rapidity and the responses that Dr. Valenzuela, sees in his practice on these patients, we'll know very early whether 6 billion cells offer a significant advantage over 4 billion cells. So I don't think it's -- I predict it won't come down to tox, although we haven't hit a maximum tolerated dose, and I don't think we'll push beyond 6 billion cells. But it's going to be a relatively quick assessment of 6 billion versus 4 billion. If the responses are similar, we'll go forward with 4 billion because from a cost of manufacturing point of view, that makes more sense and for these cells to be available for patients. So that's how we're looking at that, but no level of toxicity is what we hope for, and that's what we've seen so far.

Your next question will come from Daina Graybosch with Leerink Partners.

I wonder talking -- you could talk a little bit more about the different organ scores. And it seems like you're consistently seeing a strong skin effect. Does that make sense from where NK cells traffic? I also think NK cells are known to traffic pretty readily initially to the lung. And that's where maybe you saw -- you didn't see as much of an effect, but you discussed that you nonetheless expect the lung effect to be delayed.

So both just more about where you're seeing the effect across both of these studies in the organs and how we should interpret that? And also, I know both of these disease types can have fibrosis involvement. And where in terms of the specific domains might we see that there's fibrosis that's going to be -- we're going to -- it's going to be challenging with any active therapy to actually address that score because of that underlying fibrosis.

Right. So I'll start, Shawn, with you. You want to tell Daina what the endpoint is and what the time point is for the first lung assessment in the trial that might help in terms of when we're going to see that improvement. And then maybe Dr. Valenzuela, you can give your opinion on what you think about how rapid this agent works in skin, why that -- why you're seeing that versus maybe some of these early lung changes or maybe some of the early lung changes you are seeing?

Thank you for your question, Daina. I'll start with the organ scores, particularly in systemic sclerosis, we've had some very rapid and robust responses seen in the skin. We do believe and we should validate what you're saying immunologically, yes, NK cells traffic very readily to the skin, and we think that might be driving that early response.

From a lung perspective, our data is relatively immature. We do collect time points at roughly 30 days or 1 month after the initial dosing and then 2 months out and then 3 months out. And after that, it's every 3 months. So what you see from a lot of the data for CAR-T, for example, is they're showing data 60 days out through 1 year, right? And our data is relatively immature in a lot of these participants. What I will highlight is those that had no ILD at baseline, we have not seen any progression in those patients of new ILD onset.

And in those who had preexisting ILD, it has been mixed thus far. We've had a couple that have improved. We've had a couple that have been stable, and we've had a couple that did not respond at all in skin or lung that had progression of lung. So we think that's some encouraging early data but premature. And we really want to make sure that we are following up for durability over a 6-plus month time frame through 1 year.

Thank you, Shawn. I think that summarizes the full cohort. But let me use examples of patients. In terms of the different organ involved in these conditions, starting with scleroderma, I have been, I would say, privileged to see some responses in patients within a rate of improvement or almost like close to resolution in some of those with very rapid softening of the skin, which is not what you normally see in the literature for the cycle of scleroderma that happens way, way after a number of years.

These are responses that can be directly attributed to the treatment. They correlate with the treatment. I can picture right now, 3 of those patients who had the very quick response of the skin to scores that if you remember looking at the curves we showed before, rapid resolution without any further damage. I will echo what Shawn said in terms of the pulmonary domain of scleroderma. We see precisely that. We've seen some early hints towards the improvement of the diffusion capacity, which is expressed as the DLCO. So -- and we don't see translated into the patient, patients we have not witnessed any kind of patients complaining or worsening of the respiratory capacity or their exercise, which is quite encouraging at this early stage.

So I think that probably would be a better graphic way to describe or to translate what you see in the data into persons or patients as I had the opportunity to see. And I'm quite encouraged by that. And if I can do a retrospective analysis of what we have done traditionally in rheumatology in this condition is quite unique. I have not seen even using the [ cyclophosphamide ] in the past, these results of this seen in these particular patients we treated.

Your next question will come from Jonathan Miller with Evercore ISI.

Congrats on all the data. I'd like to start with one for the company on durability. Obviously, this data is still early. You've got these great rapid responses. But what do you think are the major drivers of durability from here? Are they different from either auto CARs, T cell-based therapies, unmodified NKs? Are there different drivers of durability for your product versus some of your competitive products? And how can you get confident in the durability profile at this point in time when there's been questions in some of the competitive programs?

And then maybe secondly, maybe for Dr. Valenzuela a little bit. I know that you guys have retreated at least a couple of patients so far, and that data may not be fully mature or ready for prime time. But can you speak to the retreatment results that you've seen and how patients have fared after retreatment at this point?

Yes. So let me step in for a second. So what I will say broadly is -- and Dr. Valenzuela did have some of those retreated patients. We will update you on the retreatments probably in the first half of next year. We've had requests from investigators, including Dr. Valenzuela, who treated patients at lower doses, and he can speak to that why he wanted to retreat those lower dose patients when we got to 4 billion cells. But we'll give an update on all those patients in the first half of next year. And then -- but why don't I have him do that first, and then we'll come back to what we believe is the right durability number and why we feel confident that the durability we're seeing so far is encouraging and consistent. And I might pitch that over to Shawn and maybe Nadir can comment on it as well. So go ahead, Dr. Valenzuela.

Yes. Thank you for the question. Yes. So that's an interesting approach that the protocol allow us. Certainly, we are aiming for first single treatment. However, as a clinician, it's comforting to know that we have the option of retreatment in patients, especially in the phase of dose exploration when we -- perhaps due to the side effect of the lower doses, you may not have achieved the B-cell depletion as you would have expected in the past. So the -- we have -- I can give you examples. I have to mind a gentleman who is a patient who has a diagnosis of scleroderma, a construction worker who received the first cohort of doses at 2 billion and about 3 months after that the assessment pointed that he will probably -- that he had not reached the response we would have expected at the beginning.

So as part of the rationale, as I mentioned before, in having the option to retreat this patient, given the fact that he had not achieved the original expected goals, the patient was considered for retreatment, which he underwent approximately 2 months ago, and he's starting to show now he's back to work. He's a gentleman, but, again, as I said, it's a construction worker aside from the chronic features of scleroderma that he had, he's improving with his skin -- so not only the skin score, but strength and his ability to perform activity. So I guess this probably reflects the fact that from a lower dose to a higher dose than a new treatment and without any major associated complications or disruptions getting to the second regimen, this patient is now showing signs of early response.

Maybe I would ask you to go back to when we first treated this patient, he had a response. It wasn't a deep general response, but it was encouraging, right?

Exactly. So had a response, but shortly thereafter, we noticed that it was not as deep as we would have expected. In fact, some areas of the skin did not improve the way we wanted. But with the second, we're starting to see -- actually, can do a comparison, the first cycle of the second cycle and...

First cycle was 2 billion, correct?

First cycle was 2 billion. That's correct. The second cycle has put this gentleman back into the workforce. So I'm encouraged by that. And again, as I said before, as a clinician, not that we obviously would like to treat patients on a cyclic basis, but having the opportunity, the availability of a retreatment has been one of the reasons why we have seen some of these patients sign up for the clinical trial.

Shawn, do you want to talk about why we think our 3-month durability so far is encouraging and what we might expect to see.

Yes. And thanks for your question, Jon. Our leading indicators that are really important here in terms of durability is what we've learned from the cell therapy field. First of all, we're seeing robust deep B-cell depletion, and that's really important to see in periphery. We are collecting tissue in skin as well as in lymph nodes, and we look forward to presenting that sometimes at a medical congress next year. So that will be another leading indicator. As you heard Paul speak to earlier, emergence of a naïve phenotype of the B-cell compartment and reductions in the memory B-cell compartment.

This is referred to as B-cell immune reset. We are seeing this at our high-dose cohort at 4 billion cells, and we think this is an important leading indicator. Certainly, with clinical responses, we've shared with you the data as of September 18 data cut. And we're 6 weeks later, and we look forward to sharing an update on durability in the future. However, I will say that those results continue to be encouraging. Nadir, anything you would share?

Yes. I think one of the key points for us that we look for, as Shawn sort of mentioned, around the B-cell population is just what is the reconstituted population and the immune reset. So I think when we think about the early data that could guide us towards having some level of confidence of longer-term durability, it truly is looking at a reconstituted population that represents a more immature naïve phenotype. And I think we have early data for that, but it supports that rationale that we're seeing the immune B-cell reset that we'd expect.

Right. And the other thing that I would add, Jon, is that in the early days, we did have a difficulty enrolling in the trial. I think what rheumatologists didn't grasp and maybe we didn't either was that NK cells don't like T cells. So at the lower doses, you weren't seeing the robust responses that T cells were seeing at the first dose they were giving. Once we got to the 4 billion cell dose, enrollment picked up dramatically, and that was all over the past year. So what you're seeing is dramatic enrollment and dramatic results in a fairly short period of time. And now we owe it to you to follow up on that. We will.

And with an overall improved safety profile that gives you the flexibility to potentially go in and redose at some point in the future. I think that's just an added bonus that can potentially enhance some of the attributes here.

Yes. And most of the rheumatologists we've been talking to in the last 2 days because we're all here at ACR are very excited about the ability to see if you could actually maximize this dose -- and so everybody is interested in going there. So we are anticipating that enrollment in the 6 billion cohort is going to be robust. And actually, Dr. Valenzuela has treated already.

No, not yet. But he's lined up soon to treat with a compressed dose 4 billion 0, 2 and 4 patient.

Your next question will come from the line of Douglas Tsao with H.C. Wainwright.

So congrats on the data. I'm just curious how you think about going to the 6 billion cell dose? Because obviously, I think you've indicated you don't necessarily anticipate going out to necessarily 6 months before making a decision in terms of sort of your dose selection. And just given the fact, obviously, we've seen very rapid responses in terms of skin and understandably, we're seeing a little bit of a lag in terms of the lung benefits in systemic sclerosis. I'm just curious, your confidence in terms of sort of that translational data and whether the higher dose might ultimately result in better lung improvement.

I mean you essentially, Doug, just gave us what we've been discussing in the company every day, every minute. So absolutely, we are with you on that. And again, our expectation, given the rapidity results we're seeing and the depth of the results that we're seeing and the closeness that we have with our investigators and the amount of communication that's going back and forth, which is absolutely phenomenal. We're going to know pretty quickly whether we're seeing differences very quickly.

And again, at the end of the day, we want to go to pivotal. We believe that we have a pivotal dose now, and we believe we could optimize that. So we'll put together some criteria ourselves internally in terms of how we make those decisions, but we're very excited about looking at what this does. And I would say we would have to see a dramatic difference in the depth and speed of the results we're seeing that would then hopefully translate into durability and also the B-cell depletion as well as the reset. So all things that we'll be able to see over the next few months.

And if I can, I'd be curious to hear from Dr. Valenzuela in terms of sort of the translational or sort of the correlation between skin improvement that he has seen typically with lung improvement in scleroderma.

Well, exactly. So I'm eager to see those results. I think we will use that benchmark the B-cell depletion and specifically the reset characteristics of the new phenotype of those cells to compare them to the results that you get with CAR-T. Essentially, that's the ultimate goal. And I believe that if you look -- again, I refer you to the PK curve that we showed before, that's an achievable goal.

The depth of the depletion would be, I think, achieved either in this regimen, more competitive or perhaps even the 6 billion, we will see. But I think it's very encouraging to translate what I see -- what we see in the lab into the clinical responses of the patients. And I see -- that's why I see the clinical dose response from the 1 billion patients in the past to this current 4 billion doses. I believe I'm seeing that now apply to the patients' responses.

Nadir, you had some comments, Shawn had some comments, yes.

Yes. I think just the last point, Doug, around the translational data and what we want to see. I think what we look for there, obviously, is continued deep B-cell depletion and reconstitution of naïve phenotype, but we're also collecting additional translational data where we can do some comparisons looking both in lymph nodes and in tissues as well. So that's going to help inform us as to whether there's some difference that would give us confidence that the 6 billion dose might be a better dose than 4 billion.

I would just add one thing. As we've highlighted before, NKX019 behaves very much like a traditional biologic, right? We're seeing a very clear dose response. So we're going to look at safety, of course, we'll be looking at efficacy, as you've heard, and it comes down to pharmacology as well, right? We'll be looking at the PK to see whether there's any increase in exposures with the compressed dose regimen, especially as we escalate between 4 billion and 6 billion cells and then many of the pharmacodynamic measures that you've already heard described.

Okay. One more question or group of questions from the last person is what I'm expecting.

The final question will come from Stephen Willey with Stifel.

I guess, I appreciate the early B-cell profiling data you provided, and I think we know that NK cells are advantaged in terms of being able to traffic into lymph tissue. Have you been able to get lymph node biopsies from any of these patients? And should we expect to see profiling of reconstituted B cells from here? And then do you think the depth of skin score improvements that we're seeing in scleroderma patients is facilitated by this trafficking capacity? And then I just have a follow-up.

Yes. So on the lymph node biopsies, yes, we're able to do them. It is still early. What we do find is, believe it or not, the capability of centers to do lymph node biopsies, particularly academic centers. No, I'm going to get to Dr. Valenzuela, who's looking at me right now because he knows how to do these with expertise.

When I see lymph node data come in, I trust the stuff that he's giving us. And when our academics are dealing with interdepartmental, whatever you want to call it, sometimes that becomes more complicated. So I'd say getting lymph node biopsies is a challenge, and Dr. Valenzuela can speak to his experience because he's done it now in a number of patients. And you want him to talk about the depth of responses as well.

Okay. Well, thank you. So to the point of the lymph node biopsies, we incorporated that in the trial already had a number of subjects...

I actually believe it was your idea to do that, which wasn't, I guess...

No, sure. I think it's -- we have biopsies in several since the 4 billion cohort in the majority of the patients we have pre-lymphodepletion and 2 different time points at the completion of the NKX019 and 30 days out. So we have 3 time points in the majority of the patients that I think will be data -- we're gladly waiting to see.

And in terms of the skin response, I cannot answer that question. I think here -- I think Nkarta will have to start looking at those biopsies and it's a little early perhaps to have that answer for you. I think we will probably see changes. I expect as clinicians that we'll see changes in the structure of that disease of the skin as a surrogate for the clinical observations. But I would say for me, it's a little too early to answer that. I wish we can find the direct correlation that will be even more supportive of the clinical findings that you're two having.

Do you want to talk about your -- you know how to do skin biopsies as well.

Yes, skin biopsies, we do in our -- it was relatively simple. Sometimes like I have questions as to why many cannot do that. It's a very simple procedure, biopsy, whereas the node biopsies, we try to optimize the retrieval process of the lymph biopsies. We have them done under the expert hands of radiologists, interventional radiologists who can actually hone in the biopsies. And so far, we've been quite successful at getting enough sample for the majority of these patients in this cohort. So very anxious to -- actually very hopeful to see the results.

Since it's you, Stephen, do you have any more follow-up, you'll be the last one.

Yes. Just lastly for you guys, and I'm sorry if I missed it earlier, but how much patient data at the 6 billion cell dose are you hoping to provide at the time of next disclosure? And should we expect those patients to all have a minimum of 3 months of follow-up as well?

Yes. We're going to update on 6 billion. We would have 3 months of follow-up, and we would do it with a robust number of patients probably between 6 and something beyond that. But that's really our goal.

So with that, yes, I want to thank you for joining us today and for your questions. I want to thank Valenzuela. I do want to highlight the question on biopsies and things like that. I think the issue and the reason that we are so excited about working with community-based centers, there is no bureaucracy and the ability to do things, simple things like lymph node biopsies and skin biopsies becomes a matter of a conversation, not a negotiation.

So I want to thank Dr. Valenzuela, our investigators and study teams and above all, to the patients and the care partners who made these data possible. And we look forward to sharing more data on safety at ACR on Wednesday, where Dr. Valenzuela will be giving an oral presentation on the overall safety of our NKX019 and additional follow-up in 2027. Thank you very much.