Prokidney 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 ProKidney. And presenting on behalf of the company, we have CEO, Bruce Culleton.

Good morning, everyone. And thank you, Anupam and JPMorgan for inviting us back to the conference again. It's a pleasure to present this morning. So at ProKidney, our goal is to transform the treatment landscape for patients living with advanced chronic kidney disease. Patients who are at high risk of kidney failure and facing a real prospect of ending up on dialysis.

We believe that our lead product, rilparencel, there's a meaningful opportunity to intervene and change the course of a patient's progression to kidney failure. So these are the customary disclosures and disclaimers.

So there are over -- today, there are over 3 million Americans with advanced chronic kidney disease. These are patients that over the next few years that are very high risk of developing kidney failure. Many of them will require dialysis. The lucky few will get kidney transplants. They all share one goal, and that's the need for more time. So more time for spending 3 days -- more time from not spending 3 days a week in the dialysis center, more time for life's moments and more time and flexibility with the people that matter the most.

So we are advancing this goal through the development of rilparencel, an autologous cell therapy that's made from patients' own kidney cells. Across multiple Phase II trials, we've seen kidney function stabilization with the use of rilparencel. Excluding our Phase III data, which is ongoing, we've treated over 150 patients and rilparencel has demonstrated a very favorable safety profile. It also doesn't require any preconditioning or immunosuppression after treatment, unlike many of the other cell therapies.

Importantly, we are now marching towards a pivotal Phase III readout in about 5 quarters from today. So in Q2 2027. Our goal is to make rilparencel available to patients who urgently need it and to provide different and better treatment options for patients with advanced chronic kidney disease.

So 2025 was a pivotal year for us. But before I touch on our accomplishments, I want to begin by recognizing the approximately 250 ProKidney employees whose hard work and dedication made last year a pivotal one for our company. Their commitment drove meaningful progress across every aspect of our business, and I'm extremely grateful for their contributions.

Key highlights from 2025. We aligned with the FDA on an accelerated approval pathway using eGFR slope as a surrogate endpoint. We presented positive Phase III data as a late-breaking clinical trial at ASN's Kidney Week. We generated significant momentum in the Phase III PROACT 1 study. That's our pivotal Phase III study and the readout that we anticipate in Q2 2027 because of this momentum around enrollment.

And finally, we initiated expansion of ProKidney's in-house manufacturing footprint in facilities in Winston-Salem, North Carolina. So 2026 is going to be a year of highly focused execution for us. We prepare for a readout in 2027 for our Phase III data. We expect importantly, to complete enrollment for the accelerated approval efficacy analysis by mid this year.

We will continue to execute on our R&D plan. That's important for us to be able to explain our mechanism of action. I'll get into that in more detail later in the presentation. We also maintain active engagement and dialogue with the FDA under our RMAT designation. And finally, as we continue to prepare for commercial launch, we build out additional manufacturing capacity in North Carolina, where we own and operate those facilities.

So just before I dive deeper into some of the data, I'd just like to quickly level set on some of the progress. So we are solely focused on the one product, rilparencel, a first-in-class autologous cell therapy and getting that cell therapy to market. We're running the ongoing Phase III study, just the one Phase III study is all we need for FDA approval in patients with advanced chronic kidney disease and type 2 diabetes. And we have generated robust clinical data to date.

We have a very experienced clinical -- a very experienced leadership team, and we have cash runway that takes us past the data readout into mid-2027.

So a little bit about how we make our product. So rilparencel is manufactured using a patient's own kidney cells. And unlike some other cell and gene therapies, rilparencel doesn't consist of any gene editing. There's no preconditioning, no pretreatment and there's no immunosuppression after a patient received rilparencel because it's their own cells.

The process starts by harvesting a small piece of kidney tissue through a pretty standard kidney biopsy. That kidney tissue is transported to our manufacturing facility. When it shows up, there are about 50,000 to 100,000 cells that are available for us to work with. We expand them through a series of passages, and we end up with well over 1 billion cells that undergo a selection process.

The product is then cryopreserved and shipped back to the clinical study site for injection into the kidney cortex. 3 months after the first injection, we inject into the other kidney in the kidney cortex. All the injections are done by CT imaging by a trained interventional radiologist.

This is just a little bit about our manufacturing facility. We've got -- we purchased 2 adjacent buildings. Our approximate square feet is 180,000. We currently support our clinical manufacturing from these facilities. We have ongoing capital investment to manufacture -- to grow out that manufacturing infrastructure and to support what's required for a BLA submission. And these facilities also have some administrative research and cGMP manufacturing operations for a cell therapy platform.

So I'd like to spend just a few minutes to sort of set the stage on the unmet need in the patient population. So this is a complex slide. This is a framework of how we think about chronic kidney disease. It was developed by many scientists quite knowledgeable in this field, and this framework is used globally to understand the classification of chronic kidney disease, but also to understand the risk associated with different categories of chronic kidney disease.

So the rows represent kidney function as measured by estimated glomerular filtration rate or eGFR. You could see on the top row, if your GFR is above 90, you have normal kidney function. And in contrast, down on the bottom row, if your GFR is less than 15, you have what's called kidney failure. Most of these patients either have a transplant or are on dialysis or some are waiting to be started on dialysis.

The columns represent kidney injury as measured by the amount of albumin that's lost in your urine. And these are different categories of UACR. And then you could see that based upon where a patient may fall in a row or a column, then the heat map tells you what risk they have for developing kidney failure.

The area that's imposed by the blue line, the blue box, this is the area that we are focused on. These are the patients that we believe have the greatest unmet need. And these are the patients that we're currently enrolling into our Phase III clinical study. So we have seen over the last 5 years, a significant advance in the treatment of patients with chronic kidney disease. In particular, there's been many landmark clinical trials that have looked at patients who have chronic kidney disease and type 2 diabetes.

Some of these landmark trials are shown on this slide. Most of the participants in these trials have Stage II or Stage III chronic kidney disease. A few have advanced CKD that you could see on the right-hand column, subjects with Stage IV CKD. Primarily, the patients that have enrolled in these studies with Stage II and Stage III CKD, that exists because that's where the biggest population of patients with CKD currently reside.

There are well over 10 million Americans, well over that with Stage II and Stage III chronic kidney disease. But in contrast, patients with Stage IV chronic kidney disease are much lower. There's probably about 1 million Americans with Stage IV CKD. About 40% to 50% of them have coexistent diabetes, and that's the group that we hope to help with rilparencel.

A little bit of a complex slide here as well. So this is from one of these landmark studies that I just showed on the prior slide. The data here is illustrative of what's seen in the other landmark studies as well. So on the left-hand side in the left panel, you'll actually see change in kidney function as measured by eGFR. The blue line represents patients who are treated with dapagliflozin, an SGLT2 inhibitor. The red line represents those patients who are treated with placebo.

And much like other products in this space, there's an acute decline in eGFR, an acute decline in kidney function within the first 3 months. And then over time, that progression slows. But what you do see because of that acute decline, and if you look at the table in the box, the table in the left-hand panel, at month 24, there's a difference of only 1 ml per minute in progression of kidney disease. So 1 ml per minute.

So what that means in a population of, say, thousands of patients that becomes statistically significant. It's also clinically meaningful when you think about a population of patients with CKD. On an individual patient, 1 ml per minute doesn't seem like too much. Now these agents also confer cardiovascular benefit. And so they're also extremely important at reducing the risk of cardiovascular endpoints in these patients as well.

Now please take a look at the right-hand panel. So this is a slightly different look at this study where the endpoint is the cumulative incidence of a decrease in kidney failure in eGFR -- sorry, a cumulative incidence of a 50% loss in kidney function as measured by eGFR and kidney failure and death.

The placebo group is shown in red. The dapagliflozin group is shown in the blue. As you could see by looking at the blue curve, many of these patients continue to have events. Despite being part of the new pillar of care for patients with chronic kidney disease, these are not cures. Patients do continue to have events. They do continue to lose kidney function and many of them still end up on dialysis. So there's several ways that you could look at this to make that a little bit more meaningful. One is something called the number needed to treat. And in this study, you need to treat 19 patients with dapagliflozin for the course of the study to prevent one of these composite events.

Another way to look at it that's not shown on this slide, but it's in their paper, is that on average, treatment with dapagliflozin for 2 years delays dialysis for 4 months. So that's still relevant for a patient, but it's not delaying dialysis for years. It's delaying dialysis for 4 months. So that's the unmet need.

Now I'd just like to spend a few minutes on our clinical study program, our Phase III study design, an update on enrollment as well as just an overview of our R&D plan. So all the studies that we've -- all the clinical studies that we performed using rilparencel are shown on this slide.

There are 2 ongoing clinical studies. One is the Phase III study. The other is a long-term follow-up study called Study 008 in patients that have been previously enrolled in one of our prior Phase II trials. So this is REGEN-006, our Phase III program, also called PROACT 1. This is a randomized sham-controlled blinded parallel 2-arm clinical study. I know there's been a lot of talk around FDA's expectations within the cell and gene therapy around clinical trials. This design meets their expectations.

So this is a robust clinical study design in a cell therapy, using a cell therapy. Patients enrolled in this study will have to have type 2 diabetes and advanced CKD. You could see the key entry criteria on the left-hand side of the slide. Randomized patients are stratified by SGLT2 use and baseline eGFR, and they're allocated to the intervention or the rilparencel group or a sham cohort, that's the control arm.

Patients and the principal investigators are blinded to the treatment allocation. As stated earlier, we have alignment with the FDA for accelerated approval using eGFR slope as the surrogate endpoint. In the same study, patients will be followed over time for the confirmatory analysis, which will be performed when 122 patients have one of the composite clinical events.

As stated earlier, we've done a really good job. The teams have done a really good job in enrolling patients this year. A special thank you goes out to all our study participants, our study sites and also to our internal clinical operations and manufacturing teams who've really been dedicated to this over the last several years, but we made significant progress this year and a special thanks to them.

So if we stopped enrollment today, which we're not going to do, but if we stopped enrollment today and just followed the currently enrolled participants, we would have 80% power for the surrogate endpoint efficacy analysis in Q2 2027. We're going to continue to enroll patients. And by mid this year, we'll have sufficiently enrolled patients for 90% power. And we are very confident based upon that enrollment, where we stand today and if you look like the pipeline of participants that are coming into the study, we're extremely confident that we will have our analysis in Q2 2027 for our top line surrogate endpoint readout.

So let me talk a little bit about our R&D. Last year, we made a commitment to invest additional funds to support a lot of R&D work to further elucidate the mechanism of action for rilparencel. So we had done as a company, a significant preclinical work in the 2011 to 2015 time period. This was deprioritized when ProKidney moved to the clinic.

Notably, this decision missed the real transformative shift, I would say, to single cell and spatial omics as a means to interrogate biological systems. So now we have 4 different related programs in progress. This includes in vitro, ex vivo, in vivo in animals and in vivo in human descendants.

We are working with some of the top scientists across major institutions in the U.S., and we anticipate release of data related to our MOA throughout 2026.

So shifting gears now a little bit to some big news that we had this year, and that was related to our Phase II REGEN-007 data and why it's important because we think it provides some window into what we'd expect with our Phase III results.

So as a reminder, we presented in 2024 results from another Phase II trial at the ERA meeting in Stockholm. This year, actually, last year, it was in November of 2025, we presented a late-breaking clinical trial at ASN Kidney Week, and I'll just get into the design of that study in the interest of time.

So importantly, patients were -- patients who were eligible had type 1 or type 2 diabetes, a GFR of 20 to 50 and a UACR between 30 and 5,000. Patients were -- in 2021, we started to enroll patients, and they were allocated randomly to 2 groups. The first group is the group of most interest to us. And the reason why that's most interesting to us is because those participants were treated in the same way as our Phase III clinical study program. They had a biopsy, then they were injected into the biopsied kidney and 3 months later, they got an injection into the other kidney. That's the same treatment schedule we have for our Phase III program.

Group 2 was more of an exploratory dosing design. In Group 2, all patients had a biopsy. They received an injection into the biopsy kidney and then there was a period of waiting. And a second treatment was only given if there was a trigger and that trigger was an increase in UACR or a decrease in eGFR. What we know is of those 25 subjects that were enrolled in Group 2, 15 of them had a second injection and the time to that second injection, the median time of that second injection was 10 months.

So a much longer time between first and second injection in Group 2 than in Group 1. Also I want to point out on this slide that there was a pre-injection period. That was the control group for both Group 1 and Group 2, and that included all historical eGFR values going back to 2 years.

The primary efficacy endpoint was the difference in annual eGFR slope in that pre-injection period versus the period following the last rilparencel injection. And the primary safety endpoint was frequency of procedural and rilparencel-related adverse events.

A few things to point out on our baseline characteristics. So the first I'll note is we were underrepresented in this study of patients who are important from a chronic kidney disease perspective, and that is black Americans and patients with Hispanic and Latino ethnicity. As you could see, we were also underrepresented by women who have chronic kidney disease. And we have recognized the challenge associated with this and have gone out of our way in our Phase III program to correct that. And I'm glad to say that we've seen some significant changes in enrollment in our Phase III program with making sure that we have better representation from patient groups that are actually overrepresented in the chronic kidney disease space.

Also note that we enrolled some patients with type 1 diabetes. That's not the case in our Phase III program, which is all type 2 diabetes. And please have a look at the eGFR as well. The average eGFR was less -- was just above 30. We've narrowed the target population in our Phase III program to patients with more advanced chronic kidney disease, and I anticipate an eGFR somewhere just north of 25 mls per minute in the Phase III program.

These are the main results of the study. In Group 1, the annual decline in eGFR slope improved by 78% after treatment with rilparencel. Pretreatment, the decline was minus 5.8. Post treatment, the decline was minus 1.27. That was statistically significant and very clinically meaningful in this patient population.

In Group 2, we didn't have a statistically significant result, but we did see an improvement in the annual decline by 50% in Group 2. And just as a reminder, that group was also treated differently than what our Phase III program is at this point in time.

Safety, no rilparencel-related serious adverse events. That's pretty consistent with what we've seen in our other studies as well. And the safety profile overall, even related to the injections is pretty consistent with what's reported, a little bit better actually than what's been reported with adverse events related to a kidney biopsy.

We include this slide to graphically represent the primary efficacy endpoint. And as you could see the slope of eGFR prior to treatment with the 95% bounds on that slope in the blue shade, you could see that slope changed considerably after patients were treated with rilparencel. This table represents serious adverse events that were observed.

We did see a few events in patients who had -- who were related to the kidney biopsy. This is well described in the literature. We had one hematoma, a patient with a hematoma that was uncomplicated in a patient who received a rilparencel injection, and there were no serious adverse events associated with rilparencel as a product.

Finally -- or sorry, so just in summary, our key findings, bilateral dosing of cryopreserved product, which mirrors our Phase III program resulted in stabilized kidney function after treatment with rilparencel and the safety profile is pretty consistent with what we've published previously.

Our focus now is on continued enrollment of PROACT 3 to complete our R&D plans for this year and to prepare for BLA submission and commercial launch after top line readout. I will say one other thing on REGEN-007 data. And we do think it's a window into our Phase III program, and we may get into this a little bit into our Q&A as well. But when we also cut the data for Group 1 and just looked at those patients who are Phase III eligible, so patients who met the Phase III criteria, we actually saw a greater difference in decline pretreatment versus after treatment.

So just quickly, a quick update on our key financials and milestones for 2027. At the end of September, we had $270 million in cash to fund our operations. This will take us into mid-2027 after our top line readout. We anticipate this year as one of our key milestones to complete enrollment for the accelerated approval cohort within PROACT 1. We expect that enrollment to be complete by mid-2026. And again, we're working towards that top line readout in Q2 2027, and we feel very confident about that.

So in conclusion, I'd like to finish by returning to what we have as our North Star. And our 250 employees come to work every day with one purpose, and that's to bring a transformative therapy to patients with advanced chronic kidney disease. And that's a therapy to extend time to provide more options and to bring hope to patients and their loved ones.

Thank you all for your attention today and your ongoing interest in our company.

Thank you, Bruce. I'll ask the first couple of questions, but there will be an opportunity for the audience to ask questions. So when I prompt, just feel free to raise your hand. Bruce, when I think about ASN last November, what do you think are some of the key points that the Street is underappreciating as it relates to rilparencel, the data you presented at ASN and the derisking that it has for PROACT 1?

So I think just on the derisking, Anupam, I think there's a few things that the Street underappreciates. So one is certainly the effect size, right? So the effect size that we saw that I just went over with our Phase II data, was substantial, we've taken a very conservative approach to that effect size in our Phase III readout.

We've assumed a -- in our power calculations, we've assumed a difference of only 1.5 mls per minute between the intervention group and the control group. What we saw in the Phase II data was a difference that was greater than 4 mls per minute. So arguably, we've taken a very conservative approach. And we've had some lengthy discussions in-house as to why we did that, why it's 90% power, why we've assumed a smaller effect size.

And honestly, it comes down to when we're ready to turn that card in May or June of 2027, we want to be sure that we don't find ourselves in sort of some port of nebulous p-value, something that's in the 0.06 or 0.08 or 0.10. So we wanted to be quite confident in the analysis at that point in time. So I think that was one.

The other thing I'll point out is consistently what we've seen in our Phase II data is we see a greater benefit in patients who have the highest risk of kidney disease and patients who have an eGFR that's less than 30. I think sometimes it's underappreciated that we changed the design of our Phase III program in early 2024 to narrow the target population from a GFR of 20 to 50, we narrowed it down from 20 to 35. And I think that also gives us more confidence moving into the Phase III readout.

And then I saw in the slide that you -- in 2026, we're going to get some fuller understanding of mechanism of action of rilparencel. What's your current understanding of the mechanism of action? And what could we learn this year?

So we certainly know a lot more about our product over the last couple of years, and we've done some -- we understand what happens when our cells come into our manufacturing facility and how that product looks different at the end of manufacturing.

And what we see in those cells that are coming out as our final product is that they have less markers of inflammation, they have less markers of oxidative stress, and they have less markers associated with fibrosis. So we know that those cells are quite different than the cells that come in from the disease kidney from the patients. We also know that the final product, the cells seem to be plastic, at least that's how it's described to us by our R&D leaders. And plastic means that if they're exposed to a different environment, they may actually have a different phenotype depending upon what that exposure is. So we've learned a lot about those cells.

Now our working hypothesis today is that we believe when the cells are injected into the kidney, they do have an anti-inflammatory effect. They do have an effect on oxidative stress. And we also believe that they take advantage of the innate sort of restorative mechanisms that are already in the kidney and they take advantage of those, and we think that's what's leading to stabilization of kidney function. But at the same time, Anupam, we -- as you saw our R&D plan, we have a pretty robust plan, and we are working with some -- not just internally where -- we have some great leadership in the R&D group, but we're also working with some top-notch people across academics in the country.

When we think about sort of that May, June data for next year, the top line of PROACT1, obviously, we're going to get eGFR slope. That's the key endpoint for AA, accelerated approval. Any other endpoints we should be focused on within that update? And then also on eGFR slope, kind of what's a win scenario?

Yes. So the key for the top line is, as you said, it's the eGFR slope. That's the key thing. We'll -- we've got some planned subgroup analysis around that as well, Anupam. But I would say the other key component of that top line readout is safety. I mean not only do we need to show the efficacy, but also we need to continue to demonstrate a very strong safety profile.

Questions from the audience? I've got one last one.

Yes, go ahead.

Very beautiful data. My question is, how many times does the biopsy sample expand in culture? And does every type of nephrons can proliferate? That's the first question.

So I'm sorry, I missed the second part.

Second question is does all type of nephronal cells expand after the culture?

Okay. That's great. Two great questions. So thank you for your question. So we've actually had some really good success at biopsies that come into our facility and biopsies that we're able to make actually cells on. We're over 95% across all our studies, and we've continued to improve on that in our Phase III program.

What we -- and then getting into the second half of your question, so the cells that come in from the kidney biopsy represent the standard kidney biopsy cell. The cells that we -- that are in the product that's finally made have primarily markers of tubular and epithelial cells, less so on the endothelial side, mainly markers of tubular and epithelial cells. And as I said earlier, they also have markers that are less inflammatory, less fibrotic as part of that final product.

Next question is, does injected cells reform the nephrons?

I don't think so. I don't think anyone has ever been able to demonstrate the formation of a full nephron. And so I don't think that, that's the case in what we're doing either. More to come in 2026, but I don't think we'll end up with that type of data to show that we're forming new nephrons.

Maybe final question for me. Your slides also talked about in 2026 becoming -- doing some commercial prep work. What does that encompass in 2026 heading into the data next year?

Well, so some of that encompasses actually getting ready for a BLA submission. And there's a long lead time to some of the items, especially related to CMC. So big focus and the internal team around ensuring that we've got everything ready for our CMC part of the submission.

And then the other thing is as you know, it takes a long time to build out future capacity around manufacturing. And so there's some early work being done around expanding our manufacturing capacity in our buildings as well.

Thank you, Bruce.

Yes. Thank you.

Good morning, everyone. Welcome to the Morgan Stanley Global Healthcare Research Conference. I'm Judah Frommer. I'm one of the smid-cap biotech analysts here at Morgan Stanley. We're just going to start out with a brief disclosure. For important disclosures, please see the Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative.

We're excited to kick the conference off in this track with ProKidney, and I'm excited to welcome Bruce and James to the stage. So thanks for being here, guys. It's been an exciting year for ProKidney. But before we dive in, maybe you could provide a quick intro to the company for those who may be less familiar. And kind of talk about the unmet need you're addressing in chronic kidney disease.

Sure. So first, Judah, thanks to you and Morgan Stanley for inviting us. We're happy to be here kicking it off this morning. So ProKidney is a company that's headquartered in Winston-Salem and Boston. We have an autologous cell therapy. It's called rilparencel. Rilparencel is intended to keep people who have advanced chronic kidney disease off dialysis. We have an employee base of about 250 people. We went public in 2022. And we're currently in a Phase III study, which we'll talk about in a few minutes.

Okay. Great. So speaking of that Phase III study, there have been some changes to the Phase III program for rilparencel. Since it began, most recently, you announced alignment with FDA on an accelerated path based on eGFR slope. Can you give us an overview of the Phase III program, how the accelerated portion came about? And was there data from the program that informed that discussion with FDA?

So just briefly, our Phase III study, it's one study. It's called PROACT 1. It's a randomized sham-controlled, multicenter, primarily U.S., but also some sites in Mexico and Taiwan. When the study was designed, it was originally designed and still remains, in some ways, a time to composite event study. And I know we'll get into some of the composite events in a few minutes. But I do want to highlight that this is a substantial study for cell therapy. And our target goal in order for us to achieve 122 events, which was our target, our target sample size was over 600 patients. And for a cell therapy, that is quite significant.

And that's because we're dealing with a potential indication where we're treating patients with advanced CKD, and that's not a rare condition. And we'll talk about the size of the market, but it is substantial. And given the substantial size of that population, the expectation is that we deliver a Phase III program with a time to composite event study. Now over the last year, we've made some really substantial strides in our discussions with the FDA. We had a meeting with the FDA in October of last year where we asked them about accelerated approval process. We have an RMAT designation going back to the fall of 2021, which gives us some more regulatory flexibility.

And our discussion with the FDA last October, our face-to-face meeting with the FDA went really well. We left that meeting with some direction that we would qualify for an accelerated approval process and to get back to the FDA with more better description of what that would look like and what our statistical plan would look like. So we actually went back to the FDA in mid-July, where we spoke to them specifically around using eGFR slope for accelerated approval, and they agreed. They agreed with our approach to how we think about the analysis. We continue to have a little bit back and forth on what that SAP exactly looks like. But at least from a conceptual perspective, big point perspective, we have full alignment on what that's going to look like.

And so eGFR slope, that has a big impact then on how we think about timing. The same study will be used for the confirmatory analysis. But by May second quarter 2027, we should have a top line readout on eGFR slope in the sham control group versus the interventional group, and that should give us an idea then, if we can move forward with the BLA submission.

Okay. Great. And FDA did provide an effect size that would be an acceptable demonstration of efficacy. So maybe you can talk to that effect size that was discussed. And can you help contextualize the effect size in terms of both natural course of CKD and what we saw in your recent top line Phase II results?

Sure. So there's a lot there. So bring me back at the end, Judah, if I don't answer some of this. So just from an effect size perspective, we actually went to the FDA with what we thought was an important effect size. And so as we thought about that effect size, which the FDA agreed with being a difference in the 2 arms of at least 1.5 ml per minute. Part of our thinking behind that is that this is a cell therapy. And the data that we had internally suggested that we should be able to hit that mark. But it's also important from a commercial perspective that there needs to be a meaningful difference. And we felt that 1.5 ml per minute per year would be a meaningful difference.

And the context behind that is that if you look at some of the SGLT2 data, their difference between the intervention group and the placebo group is -- in several of the SGLT2 trials is less than 1 ml per minute per year. So we're actually targeting something that's 50% greater than that, which we felt to be clinically meaningful and potentially meaningful to keep patients off dialysis. So that's where the 1.5 actually came in. Now to put that a little bit more context, around what happens to patients and their sort of maybe the natural history of progression, you could look at general population data, which doesn't have a lot of more advanced patients with chronic kidney disease or you can also look at some of the more recent randomized controlled studies using GLP-1 agonist, for example, or SGLT2s.

And the progression in the placebo-treated groups is typically on the range of 3, maybe a little bit worse than 3 ml per minute per year. So that's what we're expecting in our placebo group and that 1.5 ml per minute difference is we're also anticipating then in the treated group, something around that decline on an annual basis. In our Phase II study, which we released the top line results in July of this year, we actually saw -- in Group 1, which is the more meaningful group for us when we think about the data, we actually saw in the pretreatment period, a decline of minus 5.8. And then we saw after treatment, a decline of minus 1.3.

So a substantial difference, a difference that certainly exceeded my expectations. And so we -- if anything, based upon that data, one could argue that our effect size and sample size expectations for accelerated approval are somewhat conservative, but I'd rather be on the conservative side than miss something that we shouldn't have missed.

Okay. That makes sense. Now given all kind of the changes in time lines with the program, how does the accelerated path change the development time lines generally for the program? Can you kind of give us an idea of what you were expecting maybe a year ago, like you said, versus -- you mentioned the potential readout in May of '27, but how did those time lines shift?

So our previous guidance around confirmatory -- our confirmatory readout had been, I think, Q3 or Q4 of 2027. I think that was our previous guidance. That was before we really kicked off a restart to our Phase III program. And we've halted that guidance, and we'll issue some new guidance on that moving into next year. So what we've done is essentially pulled the goalposts in. And the previous goalposts were being impacted by once we restarted the clinical study and some delays in getting sites up and running and patients enrolled. So in essence, we've pulled the goalposts in, and we've given ourselves not just a -- we need to wait for events because that's not the case anymore. Now we're at a point where we feel really confident that based upon our existing enrollment that we're going to hit Q2 2027 for that readout.

Okay. And speaking of enrollment, I think you said you were nearly half enrolled in your July update. Can you talk about powering assumptions for readout in second quarter of '27? Has anything changed there? Or maybe just some more detail you could help us with?

So nothing has changed for the bad. I mean we're doing really well on enrollment. So we're actually over 50% enrolled for what we expect our sample size to be for accelerated approval. And we think that's going to land somewhere around 350 subjects with at least 6 months of follow-up. And the effect size we talked about was a difference of 1.5 ml per minute between the 2 groups, and we're powered at 90%. So we -- again, we wanted to not end up with a false negative, if you like. We wanted to be pretty comfortable when we actually open the envelope. And -- so that's why we decided to go with 90% power. We did look at different power assumptions. They would have saved us some sample size numbers, maybe would have given us a readout a quarter before Q2 or something like that. But in the big scheme of things, it really wasn't worth taking that risk.

Okay. And a couple of years ago, you modified the enrollment criteria for PROACT 1 to focus on highest-risk CKD patients. Can you remind us why that decision was made and how big the market opportunity is in these high-risk patients?

Sure. So just as a reminder, original design of PROACT 1, I'll talk about in GFR terms -- not in albuminuria terms, but in eGFR terms, the original design was 20 to 50. When we looked at the data from 002, which was another Phase II study, we saw what we thought was a signal in patients who had the highest risk of CKD -- highest risk of kidney failure with a GFR that's around 30 or less and a high albuminuria, high UACR. And so based upon -- partially based upon that information, we used the downtime in our clinical study to amend the protocol to now focus on those higher-risk patients.

But there's a little bit more to that. There's more of a nuanced answer. And the nuanced answer is, quite honestly, that we see a market where patients are going to be on standard of care. There's been really substantial advances in how we treat patients with diabetic chronic kidney disease. And we think we'll be in a position where some patients -- a lot of these patients continue to progress, but they're going to be tried on ACE inhibitors or ARBs and GLP-1 agonists and SGLT2s and maybe other things. But there's always going to be -- we believe there's no cure patients that progress. And so we see this as like an add-on to standard of care.

It's also at a time when -- if you look at patients with more advanced kidney disease, it's a time when they get referred to a nephrologist, who will be the physicians that we'll be calling upon. They get referred to nephrologists. They're not managed solely by internists and endocrinologists and others at that point in time. It becomes more meaningful for them at that point because they're hearing the word dialysis. And then finally, although this doesn't -- this shouldn't drive clinical study design, it's also -- once you reach that stage 4 CKD population, it's where payers start to recognize that this is a population that we need to pay attention to, and they're more open to newer therapies.

Okay. If the accelerator readout is positive, what's the read-through for the confirmatory portion of the study? And the confirmatory primary endpoint is a composite time to event, of which eGFR is a component. So we do get the question on how do we connect kind of those. Yes.

Yes. So it's a great question. So just on a timing perspective, we would -- by the time we do -- we have the accelerated approval readout, we expect our -- we expect enrollment to be complete for the full study. We expect most, maybe all patients who have already been treated. So then it's a matter of just following those patients for their events -- their clinical events. And the composite endpoint is dialysis, first to -- it's first to dialysis, first to transplantation, renal or cardiovascular death, and we have an adjudication committee that helps us with that or a 40% loss in eGFR.

And that's the tie-in, right? So that's the tie-in with our accelerated approval. But accelerated approval, eGFR slope also ties into transplant, also ties in easily to dialysis and also ties into renal or cardiovascular death because loss of kidney function is so closely associated with cardiovascular death in particular. So there's actually a very neat tie-in to say that if we see a difference in eGFR slope, we feel confident that we'll hit those endpoints as well.

Okay. Great. And maybe just a quick follow-up on that. From clinicians' perspective, kind of tying the accelerated endpoint to the time to event endpoint, I guess what's been response on the connection from that?

We actually haven't heard too much from clinicians on that, to be honest. The nephrologists that we -- most of our PIs are the ones that we work with directly. Most of them are nephrologists and most of them have really -- the eGFR slope accelerated approval, in some ways, just feels natural to them, right? So I don't think they actually see this as a big query at this point.

Okay. Great. We did briefly touch on the top line Phase II REGEN-007 data that you reported out earlier this year. Are there any other takeaways from that study you'd highlight? You've also guided to presenting full results at ASN Kidney Week later this year. So what can we expect from that update?

So additional information. So I think there's one thing that we've highlighted in our press release, and I'll highlight here, too, and that is in Group 1, the reason why we're so focused on Group 1 and others have been too is the design of Group 1. The treatment schedule in Group 1 is the same as we have in our Phase III program, right? So a patient gets a biopsy, we take those cells and make a product. We -- for those that are randomized to the intervention group, we inject one kidney and then 3 months later we inject the other kidney. That's the same as Group 1 in REGEN-007. And of the 24 people that were treated in 007 in Group 1, I think it was 16 -- 15 or 16 -- I think it was 16 subjects who had the key eligibility criteria for Phase III.

We haven't revealed what those results were in that group. But I can tell you, there's no difference between that group and the overall Group 1. If anything, it looks tiny bit better. So that's sort of one key piece of information. Then we've been careful because of the embargo that we haven't been able to reveal -- release all of the information from REGEN-007. Happy to say that we submitted our late-breaking trial abstract last week. We submitted our manuscript last week. So now it's in the hands of the reviewers, and we'll see what happens.

Okay. Great. Looking forward to that. We're also expecting more data related to rilparencel's mechanism later this year. What could we learn from that update? I guess what are you hoping to show from that update? And could there be any bearing on regulatory or commercial implications?

Sure. That's a great question. So MOA -- at the end of the day, if we have a positive Phase III program, MOA becomes more of an interesting scientific question, right? People still want to know, right? And we want to be able to really describe, have a great narrative on how our product works. But I will say that I don't expect a eureka moment. I don't think there's going to be one piece of data that we look at that says, wow, this is it, waiting for this for 10 years. So -- but I will say that we've got a pretty broad program now looking at our MOA using most of the very advanced tools available to say that we didn't have 10 years ago, but the teams didn't have 10 years ago.

With regards to ASN, I don't expect eureka disclosure either at ASN. It's more of an incremental story. But I will tell you that there's a partnership, a collaboration that we have with NYU Langone. And they're co-presenting a study description with us. And I think most people will find this quite interesting and maybe a very novel way of looking at MOA.

Okay. Great. Maybe we move to commercial a little bit. So within the commercial context, how do you see rilparencel competing with the therapeutic options you mentioned, right, SGLT2s, GLP-1s? And do these agents limit the addressable opportunity for ProKidney? Or is it more of a slotting issue kind of where are you sitting within there?

So I can speak to how the FDA thinks of this, and we're very much aligned with it. This is one of our discussion points with the FDA back in July, was the FDA expects the patients to get treated in both arms of the study with standard of care, right? Now we and the FDA also believe that not everyone will either tolerate standard of care, may have some side effects or may be contraindications to ACE inhibitors or ARBs or SGLT2s or GLP-1 agonist. So we believe that our therapy is going to be on top of standard of care, which makes sense for those patients that end up with a GFR less than 35 despite best efforts of nephrologist and despite best efforts of patient compliance, et cetera, et cetera. So that's where we think we'll end up.

And honestly, that market -- James can talk about the size of that market, too. That market is still going to be, I believe, will create a demand that's much bigger than our ability to supply it. Do you want to talk about the size of the market for a second, James?

Sure. When you think about Stage IV CKD patients in IIb with high UACR, we're looking at a little over 1 million patients. And you factor in diabetics to that, we're closer to about 500,000 patients. Bruce also mentioned our ability to manufacture. We have our own manufacturing capabilities in North Carolina, capable of manufacturing for our Phase III program and also capable of manufacturing for our commercial launch. We're currently expanding into, again, our own facility and have the ability to continue to expand to meet ramp as we continue to grow as a commercial company.

Okay. Have you had FDA interactions in terms of inspections of that facility thus far? Or is that kind of going to be back-end weighted?

So we submitted and received a favorable Type C response for the manufacturing expansion facility.

Okay. Great. And then just kind of on the same topic, longer term in terms of the addressable population, do you see potential to move into earlier lower-risk CKD populations? Or do you feel like you found the appropriate population for rilparencel with this study?

So that's a really common question people are interested in that because we started out, as we said earlier, right, sort of in an earlier phase of CKD. My general take on it is that, look, we think it works in earlier stage 2, but there's just so much else that's going on with those patients. And kidney disease is not necessarily top of priority for them or their physicians. And it's probably less important for payers as well. So we could, but I don't think -- I honestly think just given the demand in the population that we're targeting today, that will be sufficient for us moving forward.

Okay. That makes sense. And then maybe last line of questions in this question list before we get to a new survey we're doing this year. But can you remind us of cash runway? I think your last guidance was funding just beyond the accelerated readout for PROACT 1, but I know you mentioned there could be some updated communication around it.

No, that's exactly right. As of end of June, we had $295 million of cash that takes us to mid-2027. What's important about that date is we have Phase III data and accelerated approval in the second quarter. So we do have cash to Phase III data.

Okay. Perfect. And maybe just remind people, James, like how that component of the narrative has changed over the last year, right? This was a story where the Phase III was being run and the readout was beyond the cash runway. Was there anything done beyond changes to the study to kind of pull cash runway beyond the Phase III accelerated readout? Anything else done on the cost side? Or is it really just the study changing?

Not specifically on the cost side, no. We've always been opportunistic about raising additional capital. We've got an ATM that we can utilize as needed, and then we're certainly again, opportunistic around raising additional capital and bringing additional capital into the company. But other than being very, very cautious with how we spend our cash, nothing specific on the cost side.

Okay. So it feels like forever ago, though, where we raised $140 million, but it was June of 2024. So it wasn't that long ago, but it feels like a long time ago. The other thing I'll add to that is -- and because this was a big change in strategic direction for us, we stopped the other Phase III study. There was a study called PROACT 2, and we stopped it because we didn't need it. And this was because we really focused on ensuring we use the RMAT to its greatest capabilities and working on a relationship with the FDA. So that saved us, I don't know, $150 million, $175 million.

That's right.

Yes. So that -- I mean that -- and the accelerated approval, that really made a big difference in how we think about our company and the money that we need to get to a readout.

Okay. Perfect. That's a good update. And then maybe just switching to -- this is something we're doing that's new this year. We're trying to ask all of the companies at the conference, I would say, some topical thematic questions that can hopefully generate kind of a broad survey across biotech. So the way that we're framing this is that biotech does seem to be more exposed to external and macro factors of late. We can agree or disagree on that. So we're going to ask kind of 3 related questions. The first is related to China's rise in biotech innovation. So how are you thinking about competitive position here? Is there any influence on your R&D or your business development strategy thinking?

So James and I are going to tag team on some of these, but James, feel free to jump in. So first, I think we're all witnessing some real advances in the biotech industry in China, right? So there's a lot of noise, definitely a lot of news, a lot of -- many analysts are covering what's going on in China. What we see from a sort of regenerative medicine, cell therapy, gene therapy perspective, they've made some big investments, and they seem to be making a lot of advances for us. We don't see a real competitive threat at this point, but we see what they're doing is more of a validation of the cell and gene therapy space.

And sort of the innovation that we're bringing to the table and others are bringing to the table, I think it just -- sort of just tells us that the decisions we've made are the right decisions, and we're seeing that sort of in China today. From a sort of a business strategic position, we're happy with where we are with regards to our product. We think we're really well protected from an IP perspective, especially in the markets that we plan to commercialize in. With that said, we will keep a close eye on what's going on in China.

And if we think there's the right opportunity that comes up for business development, commercialization activities or other, then we will certainly enter -- think about that in more detail. But at this point in time, our interactions with China are pretty limited.

Okay. Helpful.

Yes. Maybe just to add that right now, we have very limited exposure to China. We do -- as I mentioned, we do all of our own manufacturing in North Carolina, primarily sourced from the U.S. And as Bruce mentioned, certainly protected by our IP.

Okay. Great. Next topic is AI. I guess, anything you can say about how you're leveraging AI or thinking about potential disruption from AI. So I think kind of both sides of the AI coin.

So I'll say that -- I'll start with just by saying, look, I'm not sure we're just throwing everything into AI. We're not doing that. So where it makes sense, we will. So for example, and I think everyone is doing this, we use AI for some of our administrative tasks. We're using AI in our cybersecurity, right? So our Head of IT or Head of Cybersecurity uses AI to look for sort of anomalous data that's coming up to help protect our IP, to help protect our R&D investments and things like that.

And I think that's -- there's opportunities, I would say, more on the commercial side as we get closer to that for using AI into our commercial operations. Any else?

Regulatory, administrative functions? Yes.

Yes. I mean just on the regulatory piece, we also just need to be super careful around any AI we use on regulatory or within clinical trials because the FDA also is a little bit concerned around some of that. And so wherever we go in using AI on the regulatory side, we're just super cautious about how we do that as well.

Got it. Okay. And last topic is the regulatory side of things. So whether it's changes at FDA, how you're thinking about pricing product eventually in the commercial setting, tariffs, I guess, anything from the regulatory side of things that is keeping up at night, is commanding more attention than you thought it would currently? Or do you feel like you're relatively insulated from the headlines?

So I would say I might stay awake at night for things that are, broadly speaking, going on in the broad regulatory policy landscape. I mean, it's fascinating times. But I'll say that we're pretty well insulated. So we've got an RMAT. We've got a good relationship with our FDA reviewers. James, if you want to speak about tariffs for a second because I know that's something that you think about, too?

Yes. I mean we've had very limited impact of tariffs other than potentially some impact on the manufacturing build-out of some of the materials that we're sourcing for the manufacturing build-out. Other than that, again, our operations are primarily sourced from the U.S. And so we've had a very minimal impact, I think, comparatively speaking, from tariffs.

Okay. All right. That's super helpful. Let me just poll to see if there are any questions in the room. And if not, I think we'll call there, but thank you for a very informative discussion.

Thank you.

Thank you, Judah.

Welcome, everyone, to the next session of the Citi's Biopharma back-to-school Summit. So we are literally back to school, checking up on all the companies. So the next one is it's my pleasure to introduce the management from ProKidney. We have Bruce Culleton, CEO; and Ethan Holdaway, who is the Head of the Investor Relations group. So welcome. I'm Yigal Nochomovitz. And for those of you in the room, if you're interested in asking questions, just chime in, there's microphones and also welcome to everyone listening on the webcast.

So Bruce, obviously, you've had a very busy summer with some pretty important data that sent the stock up quite a lot, actually. So tell us about the data, tell us about the platform, I guess, maybe to start with and how you got to this point?

Sure. So first, Yigal, thanks for having us here. We appreciate the opportunity to talk and answer any questions as well. So you're right, we had a busy summer. We announced the results of one of our Phase II trial, top line results in July. And just as a background, ProKidney is an autologous cell therapy company. We have a single asset that's called Rilparencel. It's directed at preserving kidney function in patients who have type 2 diabetes and advanced chronic kidney disease.

So our company's headquarters are in North Carolina, where a manufacturing -- it's in Winston-Salem. We have some clinical office and an R&D office in Raleigh. And we have more of a corporate office, just 1 block that way [indiscernible] walk down the street, which was good. So we did announce our Phase II results, top line for a study called REGEN-007. And then a short time after that, we announced an update on our regulatory discussions with the FDA, which we'll get into today, I'm sure as well.

So from a top line data perspective, I'll just talk quickly about the design. So REGEN-007 was a randomized open-label study. Patients with advanced chronic kidney disease and type 2 -- and diabetes, type 1 and type 2 diabetes in the study. They were randomized to get a scheduled regimen of Rilparencel, which consists of 2 injections, 1 injection in each kidney separated by 3 months or randomized to Group 2 where they received 1 injection of Rilparencel and then those patients in Group 2 waited essentially for either a decrease in kidney function measured by eGFR or an increase in kidney injury measured by UACR. And once they reach those triggers, then they will get a second injection. The overall sample size was 49 subjects, and we followed patients throughout to 18 months after their last injection.

And so just getting to the top line data, and we didn't release all the data because we wanted to preserve potential embargo for late-breaking trials presentation at ASN coming up in -- kidney week coming up in November. So from a top line efficacy perspective, in patients in Group 2 -- in Group 1 sorry. And Group 1 is really important because they're very similar to patients being enrolled in our Phase III program. So patients in Group 1, the patients who received 2 injections, their pre-injection slope of loss of kidney function was minus 5.8 mls per minute per year. And after their second injection their slope for the next 18 months or annualized slope was minus 1.3. So essentially, what that works out to is a 78% improvement in decline in kidney function for those Group 1 patients who got 2 injections.

Now we also saw less of a benefit in Group 2, and not everyone got a second injection in Group 2, I think, 15 or 16 people out of the 25 got a second injection, but they also had a delayed second injection, even though if that got a second one. But we did see a 50% improvement in kidney function decline in Group 2. So not as substantial, but still we saw a signal of efficacy in that group as well. It wasn't statistically significant in Group 2, but we did see a clinically important and statistically significant difference in Group 1.

So for the ones that didn't get the second injection in Group 2 that they just -- they didn't hit the trigger or...

Correct. Yes, they didn't hit the trigger.

Okay. So that wouldn't that suggest that they benefited enough or substantially from the first one. Or is it not that simple?

It's probably not that simple. It may simply be that their decline was not substantial to begin with or some patients give us a lot of variability in decline or you're right, presumably, they received some benefit from the first injection as well and didn't progress as you say.

Yes. So very interesting design. And this -- I don't think I've ever seen, well, the cell therapy in kidney cancer -- in kidney disease is -- we haven't seen that before. And then this design is interesting given the staggering in the bilateral. So what exactly are you going to show us -- because you have -- you kind of described it qualitatively, but we're waiting for graphs and charts?

Absolutely.

So what's -- what are we going to get at ASN? Can you -- like how much detail is going to be discussed there?

So ASN Kidney Week again, it's coming up in early November in Houston. So we're submitting an abstract this week for late-breaking trials. So that abstract is going in. I think the deadline is September 9th, so it's in the next 6 days, we'll have that submitted. We also have a manuscript that's written, that will be submitted to Jason for simultaneous publication now. All that depends upon the reviewers. So we can't say that all that's going to happen, but that's our goal.

And what you'll see if should we get late-breaking trials, acceptance and manuscript as well, you will essentially see everything in the way of graphs and figures and tables. The tables will outline, sort of, a really good description of what the patient's baseline characteristics are. You'll also see secondary endpoints, which would be things like time to dialysis in each group, time to death in each group. Small numbers, but all that was part of a secondary endpoint analysis.

And I think a lot of people are interested in subgroup analysis, what happened to patients if you were on an SGLT2 inhibitor at baseline or you were not. What happened to patients if you're on a GLP-1 at baseline GLP-1 agonist at baseline or not. What if you are type 1 versus type 2 diabetics. So those types of things will have more of an opportunity essentially to produce all that data and reveal all that data in either the abstract presentation or the manuscript. The other thing just for clarity on this is we talked about top line safety as part of our press release in July. All the adverse events will be described in serious adverse events and sort of that just broad safety analysis would also be part of that presentation.

Okay. And so you mentioned some of the changes in the slope, which were profound and -- well, for sure, in the 2 injections 3 months apart. What about just sort of the -- who are these patients? I mean, what stage of CKD were they? Because there's a big -- a big range?

So the entry criteria into the study was eGFR 20 to 50. So that encompasses Stage IV patients and some Stage III patients. The average eGFR, I think, was around 30 -- 29 or 30. So primarily patients with more advanced Stage III and some stage IV patients were part of the study.

Okay. Now you've done a lot of work over the past few years to determine where this therapy would potentially have the greatest impact. And so I guess this just sort of gets into mechanism of action and how it works in terms of the action on the podocytes. So can you talk about the MOA and how you believe this is working and why it may be better suited for certain segment of the CKD population versus another?

So first, I think, Yigal, I believe it works in patients who've got less severe kidney dysfunction as well. And even though we're targeting in our Phase III study, patients who have a GFR less than 35. There's a reason why we're targeting patients with more advanced chronic kidney disease. There are several reasons. But I'll just say that I do think it works in patients who have less severe kidney disease as well. It just may not be an easy market for us right now.

Partly because if you look at someone with, let's say, a GFR 50, for the most part, that patient's risk of dying of something other than kidney failure is maybe 100x higher, right? And so the real benefit to that patient in treating them and preserving their kidney function, is maybe not something that the patient would want to go through that their physician may not want them to go through and a payer may not pay for it, right? So our current approach within our Phase III study is to really look at patients with more advanced kidney disease, those that have unfortunately progressed to a GFR of less than 35, many of them with an eGFR less than 30.

The nephrologists may have already started discussions around what type of dialysis you may want or if you're suitable for a transplant, et cetera. So it's on a patient's mind, it's on the family's mind, it's on care partners minds. And it's also something that economically becomes a lot more attractive to payers because they don't want these patients ending up in dialysis clinics, because they know the cost of that. It's $125,000 to $250,000 per year. So that's something that they want to avoid as well.

So just getting back to the MOA. So we've invested a lot in the last 12 months to sort of revamp our thinking around the mechanism of action. The ProKidney has got a pretty rich history and in a version of ProKidney before ProKidney went public, the previous leadership at ProKidney invested in R&D but stopped really investing in 2015. And the reason for that sort of stopping real investment in R&D in 2015 was, a, I think they felt like they had the answer that they wanted, and b, they wanted to use what funds they had to start Phase I and Phase II clinical studies, as opposed to continuing R&D investment.

Now from 2015, when they stopped the research, which suggested that Rilparencel had an effect mainly through anti-fibrotic and anti-inflammatory mechanisms. When they stopped the research in 2015, the advances and new tools and how to demonstrate mechanism of action, continued to advance independent of ProKidney and all our understanding around multiomics was something that evolved over the course of that period of time. So we've really, in the last 12 months, and you'll see some of this at ASN as well. We've really started to focus a lot of our efforts on -- from a multiomics perspective, what happens when Rilparencel is injected in the patient's kidneys. And so that's where our efforts are focused today.

And we're going to get some of that, I assume, biomarker and/or functional data coming?

You'll get some of that -- you'll get hints of some of that data at ASN. And I don't believe there is going to be a light bulb moment where all of a sudden, [ Eureka ], we figured this out. I think it's going to be an incremental story that will essentially come to a point where we say, look, this is how we think it's having an effect on tubular interstitial cells. And we believe those cells talk to glomerular cells, for example. I think that's just going to be an evolving story. But we're going to continue to produce data until we feel pretty comfortable about what the story is as well.

Okay. So you mentioned in the '07, the range was 20 to 50?

It was.

Yes, right. But -- and then in the PROACT 1, which we can get into more detail, that's restricted to the lower half of that?

Correct. Yes, we've really narrowed that. So PROACT 1 was originally designed with an eGFR of 20 to 50, and about -- just a little over a year ago, we narrowed that range to 20 to 35, partly because of the changes in the therapeutic approach to chronic kidney disease and diabetes with the advent of -- SGLT2 is coming into the market, nonsteroidal MRAs, GLP-1 agonist, like the 4 -- we talk about the 4 pillars of care now in chronic kidney disease and diabetes. That's really been beneficial for patients, but there's not a lot that's been done to study patients with more advanced chronic kidney disease. All those studies have been primarily in patients with less severe chronic kidney disease. We're focused on those patients with the greatest -- what we think is the greatest unmet need at this point in time.

Right. So I guess what I was driving at was, when we see the ASN data are you going to have a view into the efficacy in that 20 to 35, which will obviously everyone sitting here and listening is going to be very curious about that set of data.

Yes. Yes. So that will be part of the subgroup analysis as well.

Okay. Well, then speaking of the PROACT 1 -- so what else is there to say -- how far along is that study? What -- when could it read out -- can you discuss that?

Yes. So PROACT 1, just as a reminder, to everyone, it's a randomized, sham-controlled, multicenter Phase III clinical study. And for a cell therapy, this is a big, big trial. Our target -- the primary endpoint for the confirmatory analysis. It's a time-to-event study, and we expect we'll need 600 to 700 patients enrolled in that study to accumulate those events over a desired period of time. So for a cell therapy, that's a huge clinical study. I mean listening to an earlier session this morning, where there's -- for rare diseases, you're still looking at single-arm studies, that are small and uncontrolled.

So this is, I would argue, one of the largest cell therapy studies. Currently, I would say, currently enrolling patients. So that -- that study was designed with an eGFR of 20 to 50, as I said, and we've reduced that now from 20 to 35. We've made some real good progress around enrollment. Recently, we said we're over 50% enrolled for our accelerated approval readout, which we expect in Q2 of 2027. And we had really good August for enrollment, really good July for enrollment. So we're above -- well above 50% enrollment for that accelerated approval.

And what's going to -- what endpoint is going to give you that path to accelerated approval?

So we are looking at a difference in eGFR slope between the 2 treatment arms. So the interventional arm and the Sham control arm. And we're looking for a difference of at least 1.5 mls per minute per year of change in eGFR slope.

And then assuming you check the box on that, then the full approval would be based on an outcomes, what would be the full approval?

Correct. So the full approval is in the same study. So we're using -- we have a single Phase III study. The interim readout will be accelerated approval readout and the confirmatory analysis will be based upon clinical events, and those clinical events are time to initiate dialysis, time to transplant, time to renal or cardiovascular death or time to more than a 40% drop in eGFR. Sort of accepted clinical harder endpoints, and that would be for the confirmatory analysis. We haven't said -- we haven't issued new guidance on when we think that confirmatory analysis will be, but we expect we'll announce some new guidance on that early next year.

So when you do the Q2 2027 for the slope difference, that doesn't -- and at that point, you won't -- by default in the protocol to analyze for outcomes. It's not. That's on how it's going to work.

That's not. So we will analyze for outcomes when we achieve, I think our target number of events is 122 events, that will trigger the endpoint -- confirmatory endpoint analysis.

Which presumably would be obviously after that point but you haven't said -- you don't know yet because it depends on the timing.

Correct, it does.

Okay. So is that -- so that's the key Phase III trial. Is there -- is there a different one? Or is that's the main one?

That's it. Yes. We -- so just for clarity as well, we had another Phase III program that we ended up stopping before we enrolled any patients. We stopped that around this time last year. And the reason we stopped that is because we didn't need it. We have an RMAT designation through the FDA and a single Phase III study is sufficient for approval.

So that one that was paused -- or stopped was sort of like a replicate of this one or was -- it was just a replicate?

Very, very similar. Yes, it was primarily being done in Europe and Asia.

By the way, some people have asked me, since you amended the enrollment criteria to look at the 20 to 35, what -- how do you analyze? There were maybe some that got in that were over between 35 and 50, right? Do they get analyzed in some way? Or how do they get deal...

So they're all part of the primary analysis. So they'll -- all be part of the primary modified intent to treat analysis and the overall safety database as well.

Okay. And then commercially, if this study works, then that would be -- the regimen would be this you -- well, we didn't even talk about that yet. Let's -- can we go through the kind of went backwards -- the manufacturing and how the cell product is prepared and yes?

Yes, of course. So it's an autologous cell product. So we -- how we obtain kidney cells from a patient is through a percutaneous kidney biopsy. That is a pretty standard procedure that's done throughout the world. It's essentially done under local -- mild sedation and local anesthetic. And what we do for the clinical study is an interventional radiologists primarily, although nephrologists are also trained to do this. Interventional radiologists use a standard kidney biopsy needle, and we take a couple of samples of the kidney biopsy, mainly from the outer cortex of the kidney.

Those samples are then shipped back to our manufacturing facility in Winston-Salem, and over the course of several weeks, those cells are expanded and we select out certain types of cells, which are primarily tubular interstitial in nature -- tubular epithelial in nature. And those cells make up the final product of Rilparencel. Before Rilparencel -- after Rilparencel is actually produced, it's cryopreserved. We typically make anywhere from 2 to 5 doses per patient although we only inject 2 doses in a patient in the trial, we hold on to the others if there's any vials that are still available.

And that cryopreserved vial gets shipped back to the clinical study site where it's thawed and under CT guidance is injected back into a patient's kidney. This is the REGEN-007, the Phase II data was the first data that we showed injections in both kidneys. And the Phase III trial is also designed to inject Rilparencel into the biopsy kidney and 3 months later into the other kidney.

So I actually hadn't thought about this before, but when you do the biopsy, then it doesn't matter which kidney, right? I mean it does -- and then with the one that gets injected first doesn't matter whether it was the one that had a biopsy or not, I guess it doesn't matter.

It doesn't. But we do go back into the biopsy kidney for the first and then the other kidney for the second injection.

Okay. And then -- you mentioned the Sham procedure. So that's always, I guess, a delicate topic because it's a question of how much Sham. Some of them are a little bit, some are -- just describe exactly what happens?

So from the perspective of making sure that this trial has internal validity, like we're doing a Phase III program, and we want to make sure it's controlled. We have taken extra careful steps, I would say, to ensure that the patient doesn't know and the principal investigator doesn't know which arm of the study, the patient has been assigned to. And for the Sham, how that works is the radiologist and the team inside the radiology suite, and they're all trained to deliver the same experience to a patient, whether they're getting a biopsy and Rilparencel or a Sham biopsy and Sham injections.

The only thing that happens -- that doesn't happen in the Sham is we actually don't go into the kidney for a biopsy, and we don't insert a needle into the kidney. But the patient does get a nick in their skin, the radiologist says the same thing to those patients who are in the Sham controls. They put pressure over where the needle goes in -- it's -- everything is explained to the patient. There's a script that the radiologist follows. So for all intents and purposes, the patient leaves that room, goes to a recovery room for 6 hours and stays there assuming that they've gotten an injection Rilparencel or a kidney biopsy, everything is followed the same way.

So even with the biopsy, they wouldn't know that they didn't have the tissue excision?

Correct. Yes. There is a nick in the skin, there's locals, they're given a local -- a sedative and they're given local anesthesia, the same thing as if they were getting a kidney biopsy.

Okay. Now I mean, a very sort of conceptual question, there's -- you were at the session earlier, and I've covered a lot of cell therapy. Usually, it's not in the sort of solid organ situation. It's in other areas, right, like lymphoma or leukemia. So you're kind of a pioneer, I guess, how do you see that? And I also wanted to ask, you're looking at CKD, but -- that's a big market, obviously. But there are a lot of rare kidney diseases where something like this could potentially have applicability as well. For example, like FSGS or others, but I just wondered what -- how you think about all that?

I'll talk about FSGS and other kidney disease in a second, but I'll ask Ethan and I'll give than some of your tech talk about the size of the kidney market.

Yes. Sure. So it's a pretty big indication to your point, Yigal. And I think if you look at our potential TAM relative to other cell therapies, out there. It's around 500,000 to 1 million patients. And so while, yes, there could be applicability for our product and other indications, FSGS, there's plenty more. I think initially, we're focused on what is the largest market within CKD, which is diabetes and advanced CKD. So we're focused on running the PROACT 1 study, and we'll assess other potential indications, I think, as we move this along.

And if you -- getting back to the MOA, I don't think -- we don't think that the product is unique to just patients who've got type 2 diabetes and advanced chronic kidney disease. If it truly does work on some form of anti-fibrotic anti-inflammatory mechanism, then even our steering committee has brought this to us as well our external steering committee, and you said, look, this might be an umbrella therapy for patients who've essentially failed everything else and have progressed on to stage 4 kidney disease where there's nothing else for them other than dialysis or kidney transplant.

So conceptually, that makes a lot of sense. But then there's is a practicality of it, like we're in the middle of a Phase III study, and we're focused on patients with CKD and diabetes. And that's our absolute focus is to execute on that study and be ready from a commercial and manufacturing perspective, there will be a day when I think we'll want to explore other potential indications.

I mean, well -- PROACT 1 it's both -- it's type 2 and type 1 or -- it's just -- so type 1 is another study later -- even though in the 007, didn't you have some of them?

We did have some patients -- we had a small number of patients with type 1 diabetes and REGEN-007, and we'll show you the data at ASN how the type 1 patients did versus the type 2 patients.

Okay. All right. Now another interesting thing is usually with some of the cell therapies it's a rare disease. And obviously, price point is high. We know what those examples are. In this case, you point out 500,000 to 1 million. So -- and you have to -- it's personalized, it's patient-specific. So of course, I'm sure you have been asked this in terms of the manufacturing gateway to -- if you have that sort of volume, how do you keep everything organized so that every patient is its own therapy. It's not specialized. So how do you do that in Raleigh, where we do it?

Yes. So we have tools in place to ensure that from the time the biopsy is done until it gets back to our manufacturing facility until it gets back into that patient, we have tools in place to make sure that only gets to the right patient. And I wouldn't say there's anything proprietary in what we're doing. It's just -- it's part of cell therapy to ensure that whatever product you're making gets back to the right patient.

Right, right. So bar coding and other control. But what is the -- right as of today, I mean, you're doing a pretty big Phase III as you pointed out for cell therapy, but that's still a drop in the bucket compared to what you would need commercially. So what is the current -- like what kind of capacity would you expect to have at launch for the product?

Ethan, you want to...

Yes, sure. So we're -- we can supply our Phase III study today. And over the next few years, and this is all baked into our cash runway guidance and all that, we're continuing to expand our manufacturing footprint and we plan to have sufficient capacity for the first few years of launch.

I will say, Yigal, though, if we see similar results to what we saw in our REGEN-007 data where we saw that 78% improvement in eGFR decline. We expect that demand will outstrip our ability to supply the product. And we are expanding manufacturing capabilities, as Ethan said, so that shortly after commercial launch, we would be able to expand in sort of more of a modular way. But if we do see the benefit that we saw on REGEN-007, then I don't think we'll be able to meet the demand for the first few years.

And when you start to think of and you mentioned dialysis and cost savings associated with preventing dialysis, which you mentioned some of the numbers, and those could accumulate quickly. So but -- cell therapy tends to be on the higher end, obviously, but this is a large market. So when you think about the pricing, how does it all get assembled into a final number?

I'll piggyback off of what Bruce just said, if we do see similar efficacy results in the Phase III, if we see that benefit -- sorry, excuse me, in the Phase II, if we see a similar benefit in the Phase III, I think we're very confident in our ability to price the product in a way that -- where we have sufficient spread between the cost of goods and the price.

And would -- I mean, I know for some of the CAR-Ts and so forth across COGS can be big number is it different for your process or similar?

I don't -- we don't know exactly what the cost of goods is for the various CAR-Ts, but we actually have a team internally working on -- a cross-functional team working on manufacturing, cost of goods today and what we think at scale. It's guidance that we intend to refresh at some point in the future, because as we progress through our Phase III and get closer to a readout, we're obviously getting a lot more questions on it. I know it's a huge area of focus. But I think for us, it's just going to be kind of balancing the size of the market, which is very large for a cell therapy compared to others out there and the cost of goods, the fact that it is an autologous cell therapy and patient demand.

I'll also say that I'm pleasantly surprised where we are with COGS today. And I do think we'll have a profitable, sustainable business, even if we were left with the sort of COGS projections that we have today, but we also have opportunities to lower that substantially more. And we'll be able to talk more about that. I think next year as we get closer to commercialization. But right now, a big piece of that COGS is people, because it's a very manual process, and there's opportunities around automation that we're looking at as well.

You have -- I mean, we hit on the big topics with the Phase III and the ASN data, but you do have some other studies as well that -- can you comment on that are still in some state of being prosecuted like there was one called REGEN-008. What was that one? And is it still relevant or not really?

Yes. REGEN-008, I would think about that as more of the study that's designed to look at long-term safety. So patients that were enrolled in prior Phase II trials primarily have been rolled over like REGEN-007 patients. They've been given an opportunity to essentially roll over into a long-term safety follow-up, which is REGEN-008, which studies 008. So we'll obviously present that data when we think there's sufficient data to present, but there's no more injections in that group. They're just really being followed for long-term follow-up safety. We will collect eGFR as well, and we'll collect data on if they die or in dialysis and things like that. So that's part of the data set that will eventually present publicly as well.

Okay. So for -- so then you would have further follow-up on those 007, I mean, beyond the 18-month point...

Correct. We will have further follow-up not on everyone because not everyone wanted to join that follow-up study. So -- but we'll have follow-up on those patients that decided to join 008 and continue to have follow-up. Yes.

Okay. And when will -- so you're submitting it on the 9th and then when the conference is in the...

So the first week of November. First week of November, it's in Houston Kidney Week, and we submit the deadline for the late-breaking trial submission, I think, is September 9. And so we'll have things submitted for that this week. And I think we get notification early October.

I mean you would think that would be something that the conference organizers would like to feature given...

I would think so. Yes, so -- okay. I'd be surprised knowing ASN, I mean they do like to present some of the latest science. So I'd be surprised if it wasn't featured in some way or another.

Yes. Okay. All right. And then if you could spend a little bit of time just talking about outside of the United States. I mean is this a study PROACT 1 that could be used to file for an approval in Europe? Or would you need different -- something different?

I think it could serve as a basis for filing in Europe. But we're probably going to need some European data as well. At least that would help with market access. It may not be even required for regulatory approval, but it certainly would be needed for market access. That's not something that we are focused on today. We decided last year to focus on the biggest market where we have a presence where we understand the regulatory path more clearly. And with that said, for the right opportunity, right level of interest, we'd be more than happy to explore opportunities outside the U.S. as well. We just don't have -- any focus there today.

Okay. And then as far as the management of the cash and the runway and all those things? Where is it today?

Yes. Yes, we had as of June 30, $295 million of cash on the balance sheet and runway into mid-2027, as of today.

Okay. So that would be enough to get you as you point out to the accelerated approval look, but then for the outcomes for PROACT 1, clearly, you need additional funding?

That's correct. Yes.

Okay. All right. And then what about just on the IP aspect, because there's multiple factors. How does the patent protection work?

So we have multiple patent families, a very solid patent portfolio that we're quite comfortable with at this point in time.

Okay. Great. Well, we look forward to ASN. Good luck with the reviewers.

Yes. Thank you.

We'll see the data there.

Yes, and thanks again for the presentation.

Okay. You're welcome. All right.