Regulus Therapeutics Inc. (NASDAQ:RGLS)
32nd Annual JPMorgan Healthcare Conference Call
January 16, 2014 11:30 AM ET
Kleanthis G. Xanthopoulos – President and Chief Executive Officer
Carter L. Gould – JPMorgan Securities LLC
Carter L. Gould – JPMorgan Securities LLC
Hi good morning, my name is Carter Gould, I am a member of the Biotech Equity Research team here at JPMorgan. It’s my honor to introduce the next company, Regulus Therapeutics. Presenting for the company will be Dr. Kleanthis Xanthopoulos.
Kleanthis G. Xanthopoulos
Thank you, good morning, he was organizing all morning of how to say my name, but you did a good job. Thank you for joining us early this morning, delightful to share with you the progress of Regulus Therapeutics as one of the key companies in the RNA therapeutics space, which we’ve been talking about for sometime as being a very powerful new way to develop medicines. I am going to be doing some forward-looking statements, so please pay attention to that thought.
So, why RNA therapeutics is so promising? First of all, we think that the fundamental technologies to create oligonucleotide therapeutics that pharmaceutical properties that are desirable have been worked out over the past two and half decades and continue to progress.
Secondly, in terms of biology, you can imagine the vast richness of the target space by simply considering the fact that 60% of the genome that is being transcribed can be targeted with oligonucleotide therapeutics, compare contrast that to a 2% of our genome that has been ultimately translated to proteins or maybe a tenth of that or 2% of the genome that creates a receptor or membrane based extracellular proteins that of course are the target of monoclonal.
So we think there is a vast opportunities here that can be systematically explored by the different modalities in RNA therapeutics by that I mean antisense RNAi and microRNA therapeutics.
So what are microRNAs? They are essentially molecules that control the translation or pace of the genome. They are single stranded molecules in the range of 22 nucleotides found abundantly in the cytoplasm and they control through interaction specifically with a three primidone to target messenger RNAs the translational pace of their target genes.
About 600 human microRNAs are known as functional entities that can fill up to 50% of our genome. And what we do find that in disease, most of these microorganism might dysregulated, so in fact we haven’t found a disease or we don’t see as hugely dysregulated set of microRNAs that typically is the driver of that, they see not just the participant and therefore our pharmacological approach is to identify that microRNA that is driving the disease in a dysregulated parts and then make sure that we titrate and balance back that over express microRNA.
So we believe that microRNAs represent a transformative therapeutic opportunity. We have been working since the inception of the company 6.5 years ago to build a clinical performance and pleased to announced that 2014 for us is a transformative year, because returning from a preclinical company into building a very substantial income portfolio and I am going to share some data with you in that regard.
We are focusing on orphan disease and on oncology. We have we think the world’s largest IP pattern in the space with over 1,000 patents covering the microRNA space and we have been very fortunate to have some extremely productive and validating platforms with AstraZeneca, GlaxoSmithKline, Sanofi and Biogen.
World renowned Board of Directors in the Scientific Advisory Board complements and advices the management team and we think we have both the intellectual capital and the commitment and passion to create a great company.
So here is our strategy of harnessing that power to microRNAs. We intend to enter the clinical development. In other words, essentially introduce the first microRNA drug into humans that comes out of the Regulus pipeline in this quarter.
As I mentioned before, we focus on orphan disease and oncology and we plan to develop a number of innovative medicines that have a transformative potential and also can become synergistic with existing remedies.
You can see that one of our biggest problems has been for sometime now is essentially what not to do. So we are trying to keep a balance between staying focus and advancing our programs, but not missing opportunities as the field of advancing of exceptionally fast. The biological knowledge that is accumulated around the space is tremendous. Last year alone, we had over 4,000 peer reviews, scientific publications published around biology microRNA.
So there is a tremendous amount of knowledge that is coming at us and we are thinking very carefully as we essentially move our programs forward. As we model our growth, at any given time, we plan to have about six programs in development.
So they are all to the clinic that we have disclosed as our strategy of last year is absolutely on track. We nominated our first candidate. We’re in fact nominated as second clinical candidate this year and move that to the clinic in the first half of next year.
We are in a very strong financial position after our IPO in October of 2012 and a follow-on in July of last year. We disclosed on our earnings call that our cash position for Q3 was approximately $124 million and we are positioned to file applications with regulatory authorities as we move our pipeline into the clinic.
I only said today two programs in a little more details, so you can understand why we are so excited about the power of microRNA therapeutics and I will start with the program that is perhaps most advanced although there is lot of programs that are competing for that distinction. It is a compound called RG-101 and it targets microRNA in hepatocytes called microRNA-122.
What we have demonstrated together with Sarnow at Stanford University is that interaction of the hepatitis C virus with that 122-microRNA is critical for the reputation of the virus. So whether you genetically eliminate those two binding sites that are shown to the left part of the slide in yellow if you can see that, if you can illuminate inadequately those two binding sides of the virus through microRNA-122 or if you’re pharmacologically inhibiting their action of microRNA-122 through the virus, the virus sends [ph] up being completely dead.
So the idea was, we can introduce a non-pioneer, a mere copy of that microRNA-122 to compete for that interaction and the prediction was that the virus will not be able to replicate and because you are talking about a semantic factor, we targeted essentially to create a molecule that would be pan-genotypic safe, potent and will be very difficult to develop resistance I guess and it turns out based on the target for our profile of the compound that we have that indeed that is the case and pan-genotypic is a very important aspect of the new treatment of hepatitis C.
Obviously direct antiviral agents have done tremendously well with rates in genotype 1s approaching 100%. However, there is still a need for how to treat patients and some populations are much more difficult and I want to highlight genotype 3 for instance where the current SVR is even with [indiscernible] combination of Gilead’s drug with NS5B inhibitors is still in the 60% to 70% range. So there is clearly room there and there is quite considerable amount of patients around the world in the U.S. alone by 150,000 genotype 3 patients.
So we are very focused on demonstrating the pan-genotypic aspect of RG-101, so that it can be positioned in hard-to-treat genotypes and I am pleased to report here for the first time that in a highly predictive animal model of hepatitis C that we have a very strong activity in genotype 3 as we are doing genotype 1. It is an artificial model called PBX, you take a human liver that has been infected with a particular genotype strain and you transplant that into a mouse, a lot of direct antiviral have a similar effectiveness in that model, so you can see a very nice dose response and the more important thing that I like to highlight is that the compound as predicted is as potent in genotype answer as it is in genotype 3.
So what is plan for Regulus with that particular compound? We are going to enter the clinic this quarter and we think that we’ll be able to read in patients a viral load reduction of a single dose of our compound by the end of this year.
I will highlight a few things and I’ll also tell you the strategy that we have in terms of RG-101. It is a compound that has been designed to be administered once among it’s a sub-Q injection. We think four injections will be sufficient to cure the virus in combination with direct antivirals.
Again that the patient as you know, goes back to the doctor on a monthly basis to check their blood levels of hep C. So compliance will be assured at the same time here we envision that that patient can get a sub-Q injection or RG-101 to increase the SVR rate.
Our strategy however is that this is a compound we want to demonstrate the powerful nature of our platform and at some point in the future, we will transact with the assay to somebody who has a franchise in HCV and needs that differentiation point.
Let me turn into a second program and share some recent data review. We’re developing these in collaboration with Sanofi. We’re targeting a microRNA called 21, which is a basically universal sensor for stress, it’s a very important microRNA. Over 500 publications have validated this as an exceptionally good target.
About a year and half ago, we published in Science Translational Medicine that there is an extremely important role for microRNA-21 in fibrosis with several organs and specifically in kidney.
If you look at the bottom left of that slide and knockout mouse whose genome does not include microRNA-21 is essentially it is impossible to use fibrosis in that versus compared to wild type. So not only is microRNA-21 associated, but it’s a big driver of the fibrosis.
With our colleague from Sanofi, we focus quickly on an orphan disease indication known as Alport Syndrome. I’d like to take sometime to explain that to you; it’s a genetic disease, it’s essentially a mutation in a number of collagen genes, it is a lethal disease and it leads to end-stage renal disease by the third decade of life for over 80% of the carriers and ultimately unfortunately these patients who are on dialysis for the most part of their lives will die. The reason is as you can see from the histology that I am showing you on the top right part of the slide, is that the glomerular basement membrane becomes fibrotic, and therefore the kidney no longer functions.
We know there are about at least 30,000 patients in the U.S. and equal number in Europe, and there are some very strong patient advocacy groups that are extremely interested in promoting new drugs in the space, as there is absolutely nothing out there for these patients other than a generic ACE inhibitor that essentially is kidney protected.
It doesn’t address the core issue of the disease, but rather protects the kidneys and have some therapeutic effect, but does not address the disease. What we have been developing for the past two or three years with our colleagues from Genzyme Sanofi is a drug that will essentially inhibit the over expression of 21 in kidney and I am pleased to show you some data, that were presented a month and half ago at the Kidney Week and have generated a tremendous amount of interest and so what you see here is that the bottom, and the top are essentially two different genetic strains of mice that have the exact same mutation as the humans.
And then you see from left to right, essentially histology it’s only dependent tocology is looking at sections of three sets of mice than normal, the fibrotic, the one that has not been treated and then to the third column, the one has been treated without drug. So you can see that fibrosis essentially is eliminated in this mice.
The second part of the slide, the middle one shows you the function as measured by blood urea nitrogen, again the same thing, we are able to restore at least 80% of the function of the kidney and perhaps the most striking dataset of all is what you see on the right side of the slide, we are depending on the severity of the mutation and that is completely dependent on the background of the mouse, we can extend survival by 50%
If that translates anywhere close to the human condition, we simply believe that we can add at least a decade of life in these patients.
So we are very, very excited about that program. We expect to nominate a clinical candidate this quarter and being the clinic, in the first half of next year in a disease that as I said is completely orphan, it is absolutely nothing out there and for the first time, we’ve seen an agent that has the ability to improve function, improve the histology and more importantly the survival of this mice. So translation of this into humans, we think will be transformative.
Let me also show you some data, that we are about, we have been discussing of how that actually works at the molecular level. So in the mutation from left to right again, we see over expression of microRNA-21 that leads to down regulation of PPARalpha, many of you know that PPARalpha agonist have been in development for a number of fibrotic conditions, but it did not make it due to a number of those small molecules that a lot of toxicity issues.
It also, over expression of microRNA-21 increases mitochondrial dysfunction and oxidative stress, when and that of course leads to renal failure. When we actually include a microRNA-21 anti-miR to reduce those levels back to normal, then you restore basically the biological pathway that maintains that proper function of the liver.
So now you take PPARalpha to go up, you see the dysfunction of mitochondria being significantly reduce as is your oxidative stress and all of these actually leads to improve renal function and survival.
Exactly what I am describing all the biochemical generic parameters, that we’ve been testing in mice and indeed that pathways restored, once we bring the drug into this mice.
So why is the excitement, why are the KOL who are interested in our approach to Alport Syndrome? As I said, we have demonstrated that we can decrease the rate of decline of renal fibrosis and restore the normalcy of the pathway and importantly of course expand the lifespan of these mice.
We also have a very interesting unique preliminary dataset, that we know, we can combine with the existing ACE inhibitors, which is the only as I described in the beginning, a treatment for this time and treatment in quotes as I said, as I said it simply used as kidney protective agent, but we think that addition, so the polytherapy between our drug and ACE inhibitors going to be not just additive, but potentially even synergistic.
So to reiterate again, this is a program, is going to be in the clinic within 12 months, we are going to be disclosing the clinical candidate nomination in this quarter and putting together regulatory filings in getting into the clinic within the next 12 months.
The final catalyst that I like to discuss, we announced on Monday that based on technology, that we’ve been developing using microRNAs is by analyzed to measure the levels of disease and predict disease from cell, is the biomarker platform that we have been developing for sometime now.
This is the subject of the large collaboration we have with Biogen Idec where we work for the first time, to be able to predict based on clinical samples, that we see it from Biogen Idec from patients with MS, will be able to predict cells versus disease by identifying a very strong and highly predictive signature of what we are expressed or dysregulated microRNAs in MS.
We also announced on Monday that a second large pharmaceutical company has entered into collaboration with us on a different therapeutic area. We expect to communicate that data before the end of the year.
So a robust platform, which we originally developed to support our own programs to give us a sense of which disease, we are going to be looking at and ultimately to help us gratify the patients, as we enter the clinic is now providing a big opportunity for us to monetize that aspects of our technology.
So let me say, we are reviewing closing a couple of the value driving events. As I said, we are going to be in the clinic this quarter. We are going to be nominating our second candidate also this quarter.
We are developing and realigning our strategic relationship with Sanofi to focus around outputs in two additional programs along the following, we like to share the upside, particularly in outputs with our friends from Sanofi, so this is a subject of a new strategic relationship with them, which we hope to be able to announce this quarter. And finally, we also like to give you some more color as we continue to develop our clinical pipeline in other orphan disease programs that we are focusing on.
And with that, I’d like to conclude our presentation here. I think we have a breakout and we’d love to take some quick set of questions and thank you for your attention.
[No Q&A session for this event]
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