Everyone. I'm very happy to be joined by Mathai Mammen, the CEO and Chairman of Parabilis. Thank you for joining us on day three of the Morgan Stanley Healthcare Conference. Thanks for being with us, Mathai. Of course. I appreciate it. Just a quick disclaimer, please visit morganstanley.com/researchdisclosures for important disclosures relating to our conference. Let's start with the Parabilis story at a high level. Maybe you can take us back to the founding of the company and the original insight behind the Helicon platform. What problem in drug discovery were you trying to solve that conventional small molecules and antibodies couldn't address? Yeah, thanks for that question. The company was founded by a Harvard professor called Greg Verdine, who was the same professor behind Warp Drive that got folded into Revolution Medicines, that's the basis of their product now, and Warp Drive and other companies as well. The problem he had been thinking about for a long time is one of drugg ability, undruggability. Most proteins inside cells lack small molecule binding pockets. Pockets are required for any kind of small molecule or version of a small molecule we have today, from degraders to covalents to anything. So what to do then? Because 80% or so of proteins inside cells lack these, and yet the genetics and phenotypic screening efforts that abound in the industry now, they often point to one of those 80% as causes of various diseases. So if that's a cause, you're kind of out of luck. The principle that he pushed then was, well, nature enables helical peptides to sit inside membranes, and perhaps that will allow us to put a protein, effectively a peptide, into a cell and function like an antibody might, that binds flat epitopes. Need for pockets is unnecessary, was his hypothesis. What he did with that was evolve a peptide platform that we call now the Helicon platform, that is comprised of stabilizing entities that hold this peptide as a helix, as an alpha helix, so it is constrained to be that way. Once it is constrained, you can go kind of crazy on the side chains. You can use whatever side chains you want. You do not have to stay within the 20 canonical amino acids. We use now over 2,000 different amino acids, so it is an astronomical diversity of peptides that we can create, and what we found subsequent to the founding is through creation of very large data sets, how to predict compositions that both enter cells and engage proteins that are otherwise undruggable. That is the fundamental problem that we have solved. Your program, Zolucatetide, is really the first major clinical test of this platform. If the drug continues to demonstrate activity across different genetically distinct diseases, how much does that validate the Helicon concept you just walked through as a broader drug discovery modality? I think very much so. It should provide great confidence that this platform is not only validated biologically, not only validated through non-clinical tox studies, but now clinically, that this molecule that you are putting into the human is able to go and find its target that is inside a cell, so therefore get into a cell and adhere to it and engage it and keep it from having function and adequately dealing with side effects and kinetics and manufacturing and all the things that need to be true to get to that point. We feel really good about the validity of the platform as illustrated through Zolucatetide. As we get into this program further and we think about β-catenin as your target, why has this been so difficult historically to drug and what allowed Parabilis to finally directly inhibit the β-catenin interaction? Yeah. That is the question. First of all, why β-catenin? Why was it tackled in the first place? It has been on the table forever. Not forever, but since 1990 when Bert Vogelstein first described it and its relationship to cancer. It was recognized alongside p53 and MYC as major elements of why a cancer is a cancer. You want to be able to do something about those proteins, and right now it is only β-catenin through Parabilis where that has been possible. So why have we been able to do that? Why has it been difficult in the first place? Beta-catenin interacts with a key transcription factor, the family of them called TCFs, and it is that interaction that the Broad, DepMap, and other ways of pointing to causality points right at that node. That node is undruggable. It lacks a pocket. It is a flat protein interacting with another flat protein. There is nothing there for a molecule to bind to. It has been therefore very challenging. It has actually been impossible. It is actually interesting anecdote is that both J&J and Merck, when I ran research at Merck and R&D at J&J, we tried very hard to drug that node, and I feel like I have personal experience failing twice on that. That was a not fun experience. It also provides some personal motivation and satisfaction for me. Never failing, just learning. That's right. That's the right way to look at it. You often describe Zolucatetide as a pipeline and a product, and I want to dig into the different indications you're targeting in greater detail, but what gives you confidence that inhibiting the same central node can actually produce meaningful clinical benefit across diseases that are as different as desmoid tumors, FAP, ACP, et cetera? Yeah. This is the case actually often in cancer that something goes wrong in a critical system, in this case, β-catenin. Either that protein, β-catenin itself, is mutated, or the protein that it is constantly almost always bound to, APC, is mutated. A mutation in either of those two proteins results in a common biology where lots of β-catenin then floods the system, engages with TCF, and drives a tumor program. If that happens to happen in a connective tissue that arises sarcoma, and it's called a desmoid, then it's a desmoid tumor. If it happens to rise in a cell in the pituitary stalk, it's ACP. If you're born with an APC mutation, like in FAP patients, and you pick up a second APC mutation during your life, it results in polyps. That's FAP. Depending on the tissue, the cell that an APC or β-catenin mutation arises in, these have different names. These are different diagnoses. But in my mind, they're all the same disease. They're the same exact biological problem and should be dealt with the same way, and that's a β-catenin/ TCF4 inhibitor. That's really great framing as we get into the different indications here. Maybe let's start with desmoid tumors. Maybe you can just spend a few minutes framing the disease burden and the treatment landscape that we see today in desmoid? Yeah. As best we know, in the United States, there's around 25,000 or 30,000 patients that have desmoid tumors. What we know is that about 10,000 or 11,000 of those patients are going to their physicians and saying, "Please help me," and they're actively seeking treatment for their desmoid tumors. We know that there's now a category called a Gamma-S ecretase Inhibitor, OGSIVEO and the coming varegacestat as potential treatments. What is the disease? It is a soft tissue sarcoma that arises in various parts of the body, often in the abdomen or neck or one of the major joints, and it just relentlessly grows in place. There's not a lot you can do about it. Radiation doesn't seem to do anything. Chemotherapy, wildly difficult to take and does not do that much. Surgery is very difficult because they're very asymmetric, and they plug into different parts of the body, so it's extremely difficult to get margins. If it rises in your neck, we have a patient where it just squeezes this poor gentleman's trachea, and where the physician, until it's treated with our drug, was considering intubation as chronically, which is terrible. So there's a level of morbidity that's profound, living with this condition. If it's in the abdomen, it's extraordinarily painful, typically because it's squeezing all your organs. It can squeeze up against your heart and spleen, and so all these things are happening that feel extraordinarily painful. So it's a big unmet need. We think the Gamma-S ecretase Inhibitors, they've been pioneers, and they offered the first-ever treatment to these patients. So we're very happy about that. That is something extremely good. But those drugs are difficult to take because of the side effect profile. So it only allows maybe 2,000 or 3,000 of these 30,000 people to ultimately be treated. So we think the unmet need remains very large. In terms of what you've actually demonstrated to date in this program, can you review a bit of the data and specifically what you view as the most important takeaways? Yeah. So we've been recruiting patients for over two years right now into both a phase I and II study and more recently, a dose optimization study as we prepare for phase III. We've had, in the last couple of months, a disclosure through our S-1 of 38 patients, and in those 38 patients, we've seen a response rate of 74%. As a context, though, it's very important, most of those were from the dose escalation arm, and they had a maturity about them that was pretty significant. So the median treatment time in those patients was nine months. So about four scans or four and a half scans on average that they've seen. We are about now, we just announced that at ESMO coming up and then again at CTOS, we will be able to substantially lift up that data set. They will offer up consistency of safety data, or you will be able to assess consistency of safety data, consistency of efficacy data, with the caveat that this is obviously a less mature data set as we've just recently fully enrolled the study. This is the data set, very important to us, though, because this is the data set we're using, the dose optimization arms, to select a dose and dose schedule for phase III. So we wanted to be able to communicate this to the investment community, to the medical community, to give confidence that we picked correctly the dose and schedule that we will end up using in phase III. We remain on track to start that study in the first half of next year. When we think about the ESMO data that's coming, what should investors be most focused on in terms of the actual endpoints and data you're going to share? Yeah. You should look for consistency in a time-adjusted sense, meaning when you have two scans, four scans, six scans. Are the datasets consistent that we're reporting now from what we've reported in the prior time? You should be looking for safety. We've said that really the only on-target safety that we've made note of in the past is a very minor effect on bone. We see no changes in DEXA scan, but we have seen at high doses, sometimes a stress fracture or two that is dealt with by just skipping a dose and putting a little splint on your finger or toe, and then it goes away. Nothing notable. You should be looking that there are no new safety effects. This is a new mechanism, so we'd always worry about that until we have way more data. If you're looking for that, and you should be looking for consistency of efficacy, like I said. I would just look for all those numbers. Not at ESMO, but potentially at CTOS, we'll start to hopefully collect some patient-reported outcome and volumetric data. There, it would be very exciting for you to look at the consistency or relationship between symptomatic changes, volume, and RECIST changes. I can tell you from, and we've talked about this a lot from the original dataset, that symptomatic changes happen well before you see RECIST changes. The reason for that is these are mass-based symptoms, so the mass of this desmoid tumor is pushing against something that's causing, say, pain. As soon as you relax that and shrink that volume by even a small amount, like 10%-20%, you're relieving the pressure that's causing the pain. You see that kick in very quickly, and then you see volumetric changes follow, then you see RECIST changes, because RECIST is just the longest axis. All leadership, I think, complains about RECIST. Here with desmoid, given the asymmetric shape of these tumors, it's particularly problematic. You can have these long, skinny, like hotdog-shaped tumors that just get to be thinner hotdogs, but the length is comparable. The RECIST change is not necessarily big, but the volumetric changes are very significant, and the PRO changes are very significant. We'll do our best as a company in the presentation to provide proper context. You're asking, so I'm just saying, these are things you might watch for. Want to pay attention to. For sure. Then as you get through those Q4 updates, you said you're planning to engage the FDA and initiate a registrational phase III study in the first half of 2027. Yeah. What are the major questions you still need to align with on the FDA? What does the ideal phase III design look like? Yeah. We've talked to FDA already, and we've aligned on the study population, so it'll be a versus placebo. Zolucatetide versus placebo study design. We've talked about sizing of it very similar to the other studies of around 150 patients. Which, by the way, for our efficacy, is massively overpowered. But we didn't want to arrive at an approval with a smaller safety database than other compounds that have been approved before us. So we're still going to size it that way. That seems fine. The main question is the dose and schedule. Hence, we did this whole optimization study, and we're taking to them a maintenance dose and an induction dose. For both, they should rightly ask, why is that dose not higher? Why is that dose not lower? We should have good answers to that, and we feel we do. So those are the questions we will discuss and align on. The endpoints are another topic of conversation. Technically, you don't need to align on your endpoints or statistical analysis plan at the beginning of a phase III, but we'd like to. We're going to discuss whether the old PFS endpoint that they used prior is the right endpoint to use, or whether a dual endpoint, meaning A or B, one or the either endpoint of ORR and PFS is the more appropriate endpoint. We feel, let's say there were no approvals ever before us, there was no precedent. We would take ORR as a primary endpoint here because tumor shrinkage is the name of the game, like we just described with mass effects and all that. It's not about in other kinds of cancers, ORR is a surrogate of PFS, which is a surrogate of OS. In this case, ORR is the clinical benefit. However, since there is regulatory precedence with PFS, we think a reasonable compromise is an either/or situation. It won't make a lot of difference to us either way, but we would slightly prefer the ORR PFS dual, as we could probably read that result out even sooner. Okay. I am just going to ask one more question on desmoid before we move on to the rest of the pipeline. From a commercial perspective, desmoid tumors have been a relatively small market historically. Do you think a better tolerated, a more effective treatment could expand the actual addressable population here? We do. We think that is the real opportunity. We think that this happens, in history, you will be aware of many situations where a first product was able to carve out a very small amount of the total addressable population because of some liabilities or inadequate efficacy of that product. Then another product comes along and it is a much bigger deal. Like bosentan and PAH versus the new endothelin receptor antagonist and other treatments is like an order of magnitude difference. TAGRISSO is obviously a lot bigger than compounds that came before it. We feel similarly about this. There are lots of patients. I will tell you an anecdote that we sometimes tell investors. There was a woman that came to visit our company that was intolerant of a Gamma-Secretase Inhibitor. She would never take that. As a woman, especially, and the majority of desmoid patients are women, the ovarian toxicity is very problematic. Yeah. There is only partial reversibility of that ovarian toxicity even after drug discontinuation. This is an issue. Plus the slow response and the needing to be patient with significant rash and diarrhea for a long time, waiting for your tumor to get a little smaller, those are barriers. I still go back to what I said, it is hard to be a pioneer, so I always take my hat off to any pioneering medicine, so wonderful. But we think that that leaves so much unmet need on the table. There is a woman that came into our company with a desmoid tumor that wrapped around her jejunum that couldn't take a Gamma-Secretase Inhibitor. So the need wasn't so acute that she needed to suffer through all these different liabilities, like I said. But every few months, she would have these horrible pains because her jejunum would get squeezed off by the desmoid tumor. She would have a small bowel obstruction, go into the hospital, get worked up, and all of this was a horrible chronic condition that she can look forward to for 40 more years. So it is a terrible situation. Right. She is unmedicated. There are many such patients. Okay. All right. Let's transition to FAP. The second area that you're exploring your program in. Can you frame what you view as sort of the unmet need? What would a meaningfully medical therapy need to accomplish to really change the treatment paradigm in that disease today? Yeah. FAP, and by the way, I'm glad you're calling it FAP because I'm getting accustomed to that versus FAP. FAP. The KOLs all refer to it as FAP. Okay, good. Thank you for that. Familial adenomatous polyposis is a condition that you're born with. It's a germline mutation in APC. That's one of the two mutations we treat with a β-catenin and TCF4 inhibitor. Fundamentally, we get at the root cause of whatever issues come up with such patients, including all the polyposis and subsequent cancer. What happens typically in a patient, maybe I can describe one of the patients we've already treated, so she would be typical. She was a young woman that was 15 years old when her polyp burden in her colon and GI tract became so bad, they were so numerous, that the gastroenterologist could no longer feel confident that he or she could snip out enough polyps to have control. Because in these patients, typically, it goes from dozens to hundreds to thousands of polyps. You can no longer feel confident that you've taken out potentially cancerous polyps. At 15 years old, she lost her colon. Surgically removed, colostomy bag pretty bad, she enters high school. Then she lives in fear after that even after her colectomy, the polyps start to fill up her duodenum. Duodenum and other places, but the duodenum seems to be the place where most are focused on because that's where the cancer comes from. That has a scale associated with it, a risk scale called the Spigelman staging, one to four. When we saw her, she was at stage four. If you look at her duodenum, it's just a carpet of polyps. You can't see any normal tissue there. She lives with this mental anguish that she's going to get cancer at any time. Her option, once she reached Spigelman stage four, which is when we saw her, is to further remove, she's already lost rectum, further remove duodenum, maybe part of her stomach. She loses a huge part of her GI tract. At that point, life becomes very tough because your nutrition is compromised, you may need parenteral nutrition, and you live a very different life than probably most of you in this room. That's the unmet need. If you talk to a surgeon right now, the risk is they may say, "We've got this. We can just keep removing GI tissue." But clearly, from a patient perspective, that's not so good. Our ideal medicine would prevent all of that. Our ideal medicine is a way to so radically change the polyp burden that it's either gone or you can just excise the two or three polyps, or you can easily control it through endoscopies. That's our treatment objective is complete control of the disease so that mentally you don't have to worry about getting cancer, and you don't have to worry about having parts of your GI tract removed. The girl you described was one patient that you treated in your desmoid study? Yeah, there were a couple patients, but she was one of them. She went from 11-week Spigelman stage four to zero, to normal tissue. Okay. The other patient we treated went from Spigelman stage two to one. In both cases, I would call that a dramatic effect, like a profound effect. I know you're planning to initiate a dedicated FAP cohort in the second half of the year. Yeah. With additional data expected Q1. Yep. What are the key objectives of that cohort, and what would be an encouraging result? We reported already that we now have 12 patients that are receiving Zolucatetide that have FAP with a desmoid tumor. They happen to be part of our desmoid study because 10% of desmoid patients actually have underlying FAP. It's a predisposition to getting a desmoid tumor. We're going to have, we treat that as bonus data, and some portion of those, and I can't say how many right now, will have scope data that we'll be able to talk about in Q1. That'll be the majority of the patients we'll be able to talk about in Q1. They will be semi-quantitative, let's say, because the pre on those, because these are desmoid studies, they didn't come into our study, as FAP patients. They came in as desmoid patients, so sometimes the scopes and the quantitation, the extent of imaging done prior is not what we would do in a clinical trial. But certainly, if we're having dramatic effects like we've talked about, we'll know that. If we're effectively having big effects on duodenal polyposis, we should be able to visually see that. That's what we'll hopefully, fingers crossed, be looking for in Q1. We'll have started the dedicated FAP study like you alluded to, and we'll press release this when we do. But we'll have probably just be getting our first patient or two Okay In Q1, so it'll be minority that. But as the year goes on, as 2027 goes on, that cohort will probably eclipse the FAP desmoid cohort and will be much more like a clinical trial of FAP with pre and post and all the right quantitation. Got it. Okay, that's helpful. Let's talk a little bit about ACP, the third indication in your pipeline. This is a rare but potentially devastating disease, and to my knowledge, no approved therapies there today. That's correct. Why is this disease well suited to direct β-catenin inhibition? Yeah. So like the other diseases we've talked about, desmoid FAP, this is driven entirely by β-catenin. This is a β-catenin mutation that gives rise to a pituitary stalk tumor, and this tumor, it's behind your eyes in your pituitary fossa, and it just grows relentlessly in place in the middle of your head. Everything you can imagine going wrong goes wrong when that happens, and so we have vision disturbances, headaches, ultimately other kinds of cognitive effects, pituitary effects, obviously, to your pituitary gland. A lot goes wrong. This tumor type is all β-catenin, so it's well-suited. It is also a strangely shaped tumor. It has cystic components and solid tumor and finger-like projections into the brain, a bit like a glioblastoma. And it is a horrible disease, as it just grows into your brain. It's chemo-refractory and relatively radiation-refractory, and radiation's bad at a young age when it's typically diagnosed. One needs to just do serial surgeries. You're serially going in and cutting out pieces of your brain to manage this condition. There's no treatments right now except surgery. Okay. You've already disclosed initial observations in ACP and expect data in the first half of next year. What have the early patients taught you? What have you observed? We presented in an oral presentation at the Society for Neuro-Oncology meeting, the SNO meeting, in December of last year, our first three patients. There were two formal PRs and one formal stable disease. When you look at these scans, most of the tumor is gone in all three patients, and the patients feel much, much better. We felt incredibly good about where we were, and part of the use of proceeds from the IPO is to lean in there and recruit heavily in ACP, as we are in FAP, as we are in HCC as well, which we can talk about. Leaning into ACP is a major priority. We have more probably medical pull on ACP than we do on other things that we work on. It's a huge amount of advocacy that we get from the neurosurgical community to get going, and we're trying our hardest to move as fast as we can here. You just mentioned HCC, and I know you're looking at that disease. You're looking at colorectal cancer and rational combinations. Anything you want to mention about your earlier pipeline and what you might be pursuing? Yeah. Zolucatetide, you said it earlier, it is very much a pipeline and a product. There are dozens and dozens of indications that we could go after. What we're trying to do is also be efficient about it as a business. What we think is that we'll define a dose and dose schedule, hopefully common, to be able to do a tumor-agnostic study and to be able to go after endometrioid and pancreatic SPN and ameloblastoma and all these different tumor types that we can look at together. There are a couple other discrete ones, big ones, that we will look at as discrete tumors, and one is HCC and one is CRC. HCC, we've already showed you a little bit of data on some profound effects on the portion of patients with hepatocellular carcinoma that are β-catenin driven. That's a big portion. That's about a third of all HCC patients don't have much going on genetically except a β-catenin mutation and a couple other mutations sometimes that are in the same pathway. This to us is a potential big deal, and by the first half of next year, we'll be able to show you more HCC data and convince ourselves, too, whether it should be graduated into that top three, the three indications we already talked about, whether it should be a fourth. Colorectal cancer, we've already generated a lot of data on that and show that in these fourth and fifth and sixth-line patients, there's a stabilization of the disease, but there's not overt responses. We believe that there were pretty profound tumor effects, though, with cavitation, shutting down of ctDNA, zeroing out of ctDNA, stopping the tumor growth, that the key going forward will be combinations. At some point, we will show you certain combinations in CRC, and that we may treat as a discrete tumor as well. Beyond that, there's lots of stuff going on as well. Pre-clinical work going on. Oh, yeah. I was going to ask you, I know you're in the early phases of developing a β-catenin degrader. Maybe you can just spend a moment on what you're trying to accomplish with degradation, could this further expand the franchise? It has already. What we can uniquely do at Parabilis is engage proteins other people can't engage. Once we do that, the compound like Zolucatetide can prevent another protein from binding, but we can also just append an E3 ligase ligand to that, like a VHL or cereblon, and degrade the protein that we are uniquely engaging. That's what we've done with β-catenin. These are very interesting compounds right now, and we imagine as second gen, maybe even a third gen is in there somewhere, as we can go deeper into other pools of β-catenin. It's a bit like what RevMed's done with [RMC-9805], where there's a follow-on type compound that's gotten even more profound activity, dialed out whatever effects they didn't want in the first lead compound. We're going to keep going, because we consider ourselves β-catenin leaders, and we want to just keep going and do as much as we can within that world. Then there's two very exciting prostate cancer programs in ERG and AR-ON, where we bind an allosteric site on androgen receptor to degrade AR in a way that's independent of amplified, the amplification status or the mutation status, which is almost everyone that fails AR therapy has either amplified or mutated AR, and we can deal with it all, we think. These are extraordinary and, like all our Parabilis programs, unique in the ecosystem, and we don't see other compounds like it. Mathai, you recently entered a collaboration with Regeneron to develop Antibody-Helicon Conjugates. Can you just spend one minute on the scientific rationale for combining an antibody with a Helicon? Yeah. So where we're excited by that is, in some cases, we want to be able to engage, functionally inhibit, degrade some protein in some cell because it's the cause of a disease, but we don't want it to go to every single cell in the body. We want to direct it. So we thought a while back about putting our compounds on an antibody to direct it to a particular cell target, but we don't have that expertise. Regeneron are kings of antibodies, and they're the original humanized antibody company. They also are one of the two companies alongside Amgen that work extensively on genetic validation of new biology. So to us, they're a perfect partner for what we would like to do. And for them, we are a perfect partner because it allows them a new chapter. It allows them a new kind of modality, which is a Helicon Antibody-Helicon Conjugate that builds on their historical antibody expertise. So it's an extremely good marriage. Both leadership teams are very enthusiastic about seeing what we can do. All the work is outside oncology. I didn't want to sign a deal within oncology here, because those are things we might want to do. Right. We're not going to work outside oncology anytime soon. Okay. Just one final question. You guys had a very successful IPO earlier this year, so congratulations on that, and you now have $1.1 billion in cash and runway into 2030. So you guys have really set yourself up for a lot of success and a lot of future investments. As you think about the next 12 months, what should investors be focused on? What should they be most excited for? I think the proceeds from the IPO, they're appreciated because it allows us to lean into the full potential of Zolucatetide. So we've talked through desmoid in phase III. We've talked about expansion with FAP expansion, ACP expansion, and HCC, exploring colorectal, exploring a tumor-agnostic. Those are all resource-intensive activities, and we'll do them all to create as much value over the next year and a half as possible, as fast as possible, as much as possible. We have now the resources to take forward our preclinical pipeline, and we have additional molecules that we're working on that we have not disclosed publicly that are for other additional indications that are just as compelling as β-catenin and others that we've talked about. This is the totality of what we'll do in the next year and a half, is make progress on Zolucatetide's full potential and the pipeline, and we'll announce probably another couple new projects. Great. A lot of exciting updates to come. Thank you for joining me, Mathai. Thank you. I appreciate it. Thanks for being here. It's great talking.