Great, so we're gonna go ahead and get started. Good afternoon, everyone, welcome to the 2024 RBC Global Healthcare Conference. My name is Greg Renza, one of the biotechnology equity research analysts here at RBC, and we're pleased to have Fulcrum with us today. Joining us is the CEO, Alex Sapir, and the Head of Early Development, Iain Fraser. Great deal going on, guys. Thanks for taking the time to join us today. Thanks for having us. Maybe Alex, we'll start to ask you to give an intro to Fulcrum for those who aren't familiar or may have known Fulcrum and are coming- Sure ... coming back to the story. A great deal going on with several assets, and also some recent news just this week that's important to cover. So I'll pitch it to you for an intro on the current state of Fulcrum. Sounds good. Yeah, thank you, Greg, and thank you all for joining. You clearly saved the best to last. I appreciate you sticking until the wee hours of the conference. But yeah, so in short, Fulcrum is a rare disease company focused on using small molecule technology to modify gene expression for rare disease, where there continues to be a high unmet need. There's a lot of companies that are doing that. I think what's really novel about what we're doing is we're using small molecule and the elegance of the small molecule approach. We have two products in the clinic and a number of early-stage discovery programs. The two products that are in the clinic is, the first and the latest, asset that we have is a product called losmapimod for the treatment of a form of muscular dystrophy called FSHD. And FSHD affects approximately 30,000 patients in the US, about 800,000 patients around the world. Currently, no treatment options for these patients, and losmapimod will be reading out its pivotal data in the fourth quarter of this year, and we believe that that study, it's a 260 patient study, we believe that it has the potential to be registration-enabling both in the US as well as ex-US. So if that study is successful, then we'll file in those major markets and actually have a potentially approved drug on our hands by 2026. Fulcrum will essentially take the lead in commercializing losmapimod in the US, and then, as Greg mentioned, this Monday, we just announced a very exciting partnership with Sanofi, who will be looking to commercialize losmapimod in all markets outside of the US. And then our other asset is an asset currently in phase 1b. That is a product called pociredir, and that is for the treatment of patients with sickle cell disease. About 100,000 patients in the US with sickle cell disease. Very heightened, curtailed mortality in these patients. About 30 years are cut off their lifespan. Most sickle cell patients live until about their 40s versus the 70s and 80s for most of us. About 4.4 million patients around the world, and we have a really interesting oral small molecule that has shown in a small number of patients to be able to get patients to a fetal hemoglobin level that rivals that than that of what's currently been seen with some of the more recently approved cell and gene therapy. So, we have some early data that shows that we can get potentially patients up after only 6 weeks of dosing. We have the potential to get patients up to fetal hemoglobin levels at around the sort of mid- to high 20s, and it's been well documented that if you can get patients' fetal hemoglobin levels up to that level, these patients' disease is essentially transformed. So, very exciting, both programs both have Orphan Drug Designation as well as Fast Track. That's in a nutshell, all that we've been doing at Fulcrum. That's great, and as you mentioned, the news of the week with losmapimod is certainly the deal with Sanofi. Yeah. Just talk a little bit about that. We and others certainly see that as a key validation point. This is also happening in the crux of and in the process of your REACH study- Correct ... with, as you, as you alluded to, the read coming in the fourth quarter. Yeah. Just talk a bit about the economics, the value that's coming with the upfront and also the potential inflows to Fulcrum and how that provides just that general reassurance- Sure ... about the program. No, absolutely. We started in earnest looking at partners outside of the US. We are a small company, about 80 employees, and obviously, we have to, as a small company, we have to choose where we wanna focus, and so we decided about a year ago that we really wanted to focus on, by far and away, the most important market, that being the US market. So we actively started looking for partners. We had a number of companies, including Sanofi, that were interested in the ex-US rights for the drug and were willing to transact on this side of clinical data, and we feel like we found the ideal partner. Just to give you some insight in terms of the economics, it's an upfront payment of $80 million with clinical, regulatory, and sales milestones that total $975 million. We also have royalties that begin in the low double digits and escalate to the mid-twenties based on the achievement of certain sales thresholds. The other important component of this deal is that Sanofi and Fulcrum will share equally all future development expenses for losmapimod, and we estimate that to be about $50 million over the next two to three years. Sanofi will be responsible for about half of that, or $25 million. I think what it allows us to do is it allows us to take some of that upfront capital and make sure that we can have the strongest launch possible in the US. Then, more importantly, what it does is in markets outside of the US, it allows us to utilize Sanofi's very strong regulatory development and commercial neuromuscular expertise so that they have the ability to bring that drug, losmapimod, faster to those patients outside of the US than we could ever do as a standalone company. All right. Absolutely. And maybe let's talk about REACH and the study as you gear up for new data later this year. Maybe, Iain, I'll turn to you to just describe the study design. There's certainly novelty to the design and to the endpoints. Maybe just weave in some of the regulatory interface to arrive at the design and how the past trials have certainly helped to inform that approach. Yeah, absolutely. Thanks, Greg. Delighted to do that. The high-level design of the phase 3 study, the REACH study, is very similar in terms of the treatment, the allocation of placebo and losmapimod across the group. So it's a 48-week treatment period, same in phase 2 as it is in phase 3, one-to-one randomization. Phase 2 had 80 patients, 80, so 40 and 40. We had originally powered the phase 3 study to represent 230 patients. The study was powered on the data from the Reachable Workspace, which we'll come to in a moment from that phase 2 study. And, the Phase 2 study included only FSHD Type 1 patients, which is about 95% of all FSHD, clinically indistinguishable from FSHD Type 2, which is about 5%, but were not included in Phase 2, are included in Phase 3, powering all done on the type 1 patients alone. And so our expectations were 210 type 1s going into Phase 3, with another 20 type 2s to make 230 overall. The powering, and we can touch on the numbers in a moment, about 93% on the endpoint based on the Phase 2 data. Turns out, as the study was progressing and we were getting to the end, we cut off screening at a time when we thought we would just hit that 230 mark. There were a lot of patients in the queue at these sites ready to enroll in the study, and so we ended up over-enrolling the study because of that. So we, we've ended up with 260 instead of 230, and of those 260, there are 242 FSHD type 1s and 18 FSHD type 2s. So from a powering perspective, we've gone from 210 to 242, which pushes the power up from about 93% to about 96% as part of that process. So that's the high-level design. The treatment, as I say, placebo-controlled one-to-one randomization. It's 15, 15 milligrams twice daily, so it's an oral therapy twice daily in the patients. There's nothing about the treatment that unblinds them. There's nothing in terms of taste or immediate reaction so that the patients don't necessarily know what's going on in terms of placebo versus active. In both phase 2 and phase 3, we've incorporated an open label extension at the end of the 48-week treatment period that the patients can elect to to roll over into. Our experience in phase 2 was that more than 95% of those patients did elect to to carry over into the open label extension. A number of them are still on drug. That was done in a completely blinded fashion, so we didn't inform the patients that you had been on placebo and now you were getting active, although they obviously knew they were all going to be on active from that time forth. We've incorporated that open label extension into the phase 3 study as well and have had similar or even higher rollover rates in that study. So it's like 98% of the patients to date have elected to roll over into that open label extension, and they are continuing, again, in a blinded fashion. So those are the sort of high-level aspects of it. Maybe touch on the primary endpoint. Let's do that. Reachable workspace. Yeah. Yeah. So, reachable workspace is the primary endpoint for the phase 3 study. It was not the primary endpoint in the phase 2 study. It was one of a number of functional endpoints that we had elected to study in phase 2. The primary endpoint in phase 2 was related to a gene expression profile based on muscle biopsies. Maybe we'll come back to that as a separate question. But the reachable workspace is a novel endpoint, has not been used to register drugs, any drugs previously. No drugs approved in FSHD, and so there's no precedent on a regulatory pathway basis for an endpoint. But FDA has been aware that this is our primary endpoint in phase 3 ever since our end of phase 2 meeting. They haven't had any alternative suggestions for that. Mm-hmm. And I think that that's been great for us, and it speaks to the fact that it is it's really a functional readout in it and addresses the way that patients are able to move their upper extremities. And as you might imagine from the name, facioscapulohumeral, face, shoulder, and arm, it's really that upper limb girdle that's predominantly affected or characteristically affected in FSHD. And the reachable workspace is an automated way using a Microsoft Kinect camera to capture the movement of the shoulder joints in space. So it kind of gives you an integrated a view of the functionality around both of the shoulder joints. I think that's one of the attractive features of it. It doesn't require you to narrow in on one particular muscle or one particular action, 'cause we know there is some heterogeneity in the population, but it focuses in on the upper extremity, which is the key part of FSHD. And so yeah, the regulators are fully aware of that. They've indicated to us that others - they were hearing more about reachable workspace from other sponsors because it seems like that has some traction, and they've expressed some appreciation to us for the work that we've been doing around the validation of that particular endpoint. And as you do the validation, certainly, you've indicated limited ability to benchmark externally, given the novelty, but with the validation, where is the conviction potential? Just talk to us about your comfort level. And then we'll maybe we can get also to have you comment a bit in on sort of your expectation, those bars for success with that readout that's- Yeah. Yeah, yeah. So, I think one of the key features of the reachable workspace is that in a prior natural history study, and I'll say there's not a lot of natural history data in FSHD per se, but there was a study conducted by the team that developed the reachable workspace instrument some years back in FSHD patients, And they were able to show, with the reachable workspace, a single-digit% decline in reachable workspace in FSHD over time. That matched up to some older studies that looked at more traditional muscle strength testing with that single-digit% decline per year. So it was certainly consistent with that, and our Phase II data have really affirmed that you see in the placebo recipients this mid-single-digit% decline in the reachable workspace over time, whereas those that got losmapimod in Phase II were stable or slightly improved relative to the baseline. So that's some of the backstory of reachable workspace in FSHD. I think the number of components as part of the validation, some of it is the pure validation of the instrument and the test-retest capabilities, and all of that is really nicely nailed down. I think there are no questions about that, and the training aspects of it and the data collection and analysis and so on. All of which is pretty complex, but is all now pretty much nailed down. The psychometric validation aspect of, does it actually measure what you're setting out to measure, which is the upper limb functionality? The answer to that is, has been yes. I think the remaining question, as we've been discussing with FDA as part of our interactions, is: What is the magnitude for an individual patient, the magnitude of a change in reachable workspace relative to the ability to, you know, comb your hair, or get dressed, or pick up a mug of coffee, or activities of daily living? And so that, that's the last piece of that overall validation program that we're working on, in collaboration with FDA. We've aligned on the sort of things that we need to do. That's happening in parallel with phase III. We've completed a bunch of that already, asking patients: "What's important to you? What are the activities you can do? What are the ones you can't do?" We're doing in the midst of a cross-sectional study, getting reachable workspace exams in these patients and then asking them to fill out detailed questionnaires on their activities of daily living, and as part of the REACH study as well, structured exit interviews, asking patients about their experience during the study. So all of those things will all sort of combine together into a full clinical outcomes assessment dossier that'll go to FDA along with, with the NDA application. So, so that's the work that's going on there. But I will just say one thing that we've heard repeatedly from patients, both prior to the initiation of the study and now emerging from the work that we are doing, and that is, you ask the patients: "What is the single most important attribute for you for a therapeutic short of a miracle cure?" And they say, "Stabilize my disease. Prevent it from getting worse." And I think that that's something that's come through repeatedly and something that FDA has also indicated that they're paying attention to that as well. So I think irrespective of the magnitude of the difference, if we could show some degree of stabilization in those patients, that's going to be hugely important. That's great. And you did bring up gene expression. I just wanna touch on losmapimod's ability to impact gene expression. A great deal of complexity involved, but comment on that, and then also just follow up on your comments as well, just on the prioritization of those secondary endpoints. So as we think about the clinical rationale, but also maybe the more the MOA rationale as well. Yeah. On this. Yeah, yeah. Absolutely. Okay. Those are great questions. So on the gene expression profiling aspect, important to say that many ways this was how losmapimod was discovered. We were evaluating cells derived from patients with FSHD, so muscle cells from patients with FSHD, both FSHD1 and FSHD2. And you can take those myoblasts, differentiate them in culture to myotubes, and during that process, DUX4 expression turns on. And what our discovery was back in the preclinical space was that, losmapimod, in a concentration-dependent fashion, was able to decrease the expression of DUX4 very clearly. And in those in vitro systems, you can measure DUX4 relatively readily. You can also measure the downstream genes that are modulated by DUX4, including genes that aren't expressed in normal myotubes that have been differentiated. They are only expressed when DUX4 is present, as it is in FSHD. We're able to show very nicely a concentration-dependent reduction in the expression of those genes, in addition to the DUX4 decline in expression, and concomitant with that, you can show decreases in markers of apoptosis and decrease in muscle cell death in a very nice concentration-dependent fashion. So that's the mechanism of action demonstrated repeatedly and very nicely in vitro. The challenge is transferring that in vitro into the clinic, where you have a patient with an FSHD muscle, and we know that those muscles are not normal by any means, right? It's got muscle tissue, there's fat infiltrating, there's muscle being replaced by fat, there's an inflammatory component, there's a fibrous tissue component, and so you get a very mixed bag. That's what we saw in the biopsies in the Phase II study is this huge variability in the tissue composition of those muscle biopsies, some of them having very little muscle and a lot of the other stuff, and then over time, that changing as well. So I think that was one of the contributors to the fact that it's difficult to detect a signal in the clinic for that reason, and also because we know, and this is true in vitro as well, that it's only a minority of the muscle nuclei that are actually expressing DUX4 at any one time, and by minority, we're talking 1 in 1,000, 1 in several thousand. So it's a very low-frequency event that you're trying to get, and then you're adding in the variability of the biopsy. Very challenging to demonstrate in vitro, in vivo from muscle biopsies, but very convincingly able to demonstrate that in vitro in those myotube culture systems. In those same experiments, we've also been able to demonstrate, losmapimod being able to reduce many of the genes that are downstream from DUX4 as well. Yeah, yeah. Not just DUX4 itself, but the downstream genes modulated- Right ... by that expression. Right. And Alex, REACH as a registration-enabling study, which means sites are on commercial. How are you positioning the organization? What are you thinking about when it comes to the FSHD patient population, the family population, standing up an organization- Yep ... and an infrastructure to reach these doctors, care managers, prescribers, and patients? Yeah, absolutely. So, yes, so we are fully committed to standing up our full US-based commercial organization, starting with hiring a chief commercial officer, which we would expect to do in the coming quarters. I've been actually extremely pleased at the number of, previous chief commercial officers with rare disease launch experience that are interested in taking this one on, because, as I said at the outset, 30,000 patients, and these patients essentially have nothing. I would say that in the interim, what we've been doing is really two things. Number one, we've been educating on the community on what reachable workspace is. It is not an instrument that is commonly used by these neuromuscular specialists when treating their patients with FSHD. It's not an instrument that is routinely used. So we've been doing some CME activities at some of the major neuromuscular conferences, MDA, as an example, where we're educating them on what is reachable workspace, so at least they have some context when the study results actually come out in the fourth quarter of this year. What we have heard across the board is because these patients have nothing, if the study is successful, and we can get an approved drug sometime in 2026, what we've heard from many physicians is that there would be broad utilization of this drug amongst many of their patients, especially maybe some of the patients that are earlier in their disease, based on what Iain said, which is that ultimately, what patients want is something that can keep them at the level that they're at now, as opposed to preventing that continued decline. The other thing we're also doing is we're making sure that genetic testing does not become an impediment at launch. There's many, many rare diseases for which, in the absence of a drug, their genetic testing is rarely used, right? And that's exactly what's happening now. About 20%-30% of FSHD patients actually have a confirmed genetic test that says they either have FSHD1 or FSHD2, and we do believe that the payers will almost undoubtedly require a confirmed genetic test as part of that prior authorization. So we're doing a lot of work right now to make sure that at the time of launch, that genetic testing does not become an impediment to uptake in the marketplace here in the US. Great. With only a minute left, Alex- Yeah ... let's talk sickle cell- Sure ... and since you're there, and just the latest on activating new sites, getting to data. I know you've been working tirelessly on standing up the cohorts. Yeah. Where are we with the study? Yeah, great, great question. So, right now, we are planning to enroll 20 additional patients. Ten of those patients will come in a cohort that will be dosed at 12 milligrams once a day for 3 months, and then there will be a subsequent cohort, which will enroll another 10 patients in a 20-milligram cohort, again, over a 3-month period of time. We are essentially right now in site activation mode, so getting many of these sites up and running so that they do have the ability to screen and enroll patients. Pleased to report we've got a number of sites that we've activated. And then I think once we get a critical mass of patients in that initial cohort, that 12-milligram cohort, once we have a good idea as to, you know, what that enrollment trajectory looks like, and we can more accurately predict when we think we'll have those 10 patients in the 12 milligram, and then later on, the 10 patients in the 20 milligram, we'll come back to the market and basically sort of guide, provide much more specific guidance than we are right now. I think until that time, we're a little bit hesitant to give guidance simply because it is a more narrowly defined patient population. It is a more severe patient population. These patients represent about 7.5%-10% of the overall market, and so our focus right now has really been activating sites. Then once we get that critical mass of patients, we'll come out with much more specific guidance in the months ahead around when we would expect to see the results of those two cohorts. Great. Great place to leave it, Alex, Iain, and congratulations on the developments in the deal this week, and look forward to the data. That's great. Thank you. Yeah. Thanks, everyone, for joining. Thanks so much, Greg. Thanks.