To take advantage of the time we do have, we might as well get going. Thank you, everybody, for joining day one of the Citizens Life Sciences Conference. My name is John Waldman, Senior Analyst here. We are pleased to have Quince Therapeutics and CEO Dirk Thye to run us through the story. I think a really compelling rare disease opportunity with phase three data coming this year for a rare condition with a very high unmet need. All these things that we really like when we think about rare disease drug development and investment opportunity. Dirk, I'll let you run through the deck. If we have time at the end, maybe we'll open up to questions in the room as well. Sure. Hi, everybody. Good afternoon. The name of the company is Quince Therapeutics. The tagline is, "Unlocking the Power of the Patient's Own Biology for the Treatment of Rare Disease." These are my disclosures, by the way. We talk about a patient's own biology because what we do is we use autologous red blood cells to encapsulate a drug inside of a patient's blood and reinfuse that back into them. That provides a number of advantages that I'm going to describe in greater detail as we go along here. The technology uses a machine. The process of using this machine to encapsulate the drug inside of a patient's blood is called Autologous Intracellular Drug Encapsulation, or AIDE. Just at a high level, the major highlights of the company are that we are currently in phase three. The lead drug is encapsulated dexamethasone sodium phosphate, so a corticosteroid. We're in phase three with about 60% of our patients enrolled as of the last update. The lead indication is Ataxia Telangiectasia. That's a rare disease with about 5,000 patients in the U.S.. No approved therapies. We are performing a placebo-controlled trial. The placebo-controlled trial is risk mitigated because the company we acquired about two and a half years ago did a previous trial in this indication and demonstrated in the population we're pursuing very strong clinical results, which I'll outline for you as we go along here. As you can imagine, dexamethasone, if given chronically in a safe manner, could be used for lots of different diseases, including many different rare diseases. That's really the value proposition here. That's the key of the therapeutic value proposition, is we can give steroids chronically, month after month, year after year, without safety issues. Our financial position is that we have a cash runway into 2026, which will get us beyond phase III data. You're looking at a picture of the machine that I said encapsulates the drug inside of a patient's own blood. This is an automated process. Basically, the patient comes in. You draw a small amount of blood, 50 mL, into a syringe. You connect the syringe to the machine. You see that touchscreen there. You push a button on the touchscreen that says Start. Over the next 90 minutes, what happens—this technology, by the way, was about 20 years and $100 million in the process of getting to this point. There was a company called LAERDAL in Italy, financed by Sofinnova, Genextra, and some other European VCs that developed this technology over the past couple of decades. What it does--it's come a long way--is it uses a series of hypotonic solutions to condition the cells to make them porous. It incubates them with a drug cargo. It does not have to be dexamethasone. It can be almost any small or large molecule. In the case of our lead drug, it is dexamethasone sodium phosphate. The phosphate piece is critical here. It is a prodrug of dexamethasone, previously approved. This will be a 505(b)(2) pathway from a regulatory perspective. Those leaky cells are incubated with the. A lot of it gets into the cells. Hypertonic solutions and excipients shrink those cells back down. You end up with a lot of dexamethasone trapped inside the cell. It can't get out of the cell because the phosphate group is ionic. It can't get across the lipid bilayer. Over time, intracellular phosphatases will cleave that phosphate group, rendering dexamethasone nonpolar. It leaks out while the cells are circulating throughout the body. Who cares? Why is that important? Okay. You should care because you can't take steroids for more than a few days without getting into serious toxicity issues. I don't know if you've ever taken prednisone for something. You get acute effects, side effects, too. After a week or two, you start to run into real problems with steroids related to adrenal suppression. That's when you start to get really bad issues like osteoporosis, diabetes, Cushingoid. You can have growth retardation. You can have delayed puberty. A lot of issues, especially in the pediatric population. These aren't typically used for chronic disease. When they are, physicians always play around with the dosing regimen to avoid the toxicity. If you know anything about Duchenne muscular dystrophy, you'll be familiar with that because drugs have been developed to try and avoid these toxicities, although there aren't any corticosteroids that really get around at least some of these toxicities. The reason why this happens is what you're looking at here is that orange line that goes up and down is a PK concentration curve of dexamethasone given once a day. It's a typical 6-mg dose given once a day. Any corticosteroid is going to look similar to this. At the lowest effective doses, you're always going to cross these plasma concentration thresholds that lead to toxicity. That dotted blue line at the bottom is the most sensitive of those. That represents the plasma concentration associated with adrenal suppression. Over time, a week or two, you're going to run into that problem if you're dosing this in a way that leads to efficacy. How do we get around that? There are a couple of things that are critical for efficacy in corticosteroids. One is a high initial Cmax. You really need a Cmax of about 100 ng per mL or higher. 100 ng per mL leads to the important non-genomic effects associated with the benefits of steroids. It also saturates glucocorticoid receptors in the tissue beds of interest for therapy. What you need is prolonged receptor exposure. You get prolonged receptor exposure with conventional drugs by giving them frequently. That's why you need to give them frequently. You get the Cmax. You get the long exposure with the conventional dosing. You trigger those toxicity thresholds. What this does is after you put it in the red blood cell, you do get an initial Cmax because at first, there is a lot of pent-up DSP inside the red blood cells. There is a concentration-dependent effect of dephosphorylation. You get a Cmax that is above 100 ng per mL. That is critical. You get the receptor occupation over time because you get this long, slow release of dexamethasone from the RBC as they circulate throughout the body. There are other theoretical benefits about biodistribution and getting into tissue beds with large capillary beds. Those are additional potential benefits. The key here is that you get around these toxicities because you get below the concentration thresholds pretty quickly. Like for adrenal suppression, you're below the threshold for about 7-10 days, after about 7-10 days. To support what I'm saying about safety, the company we acquired, EryDel, started phase II in Ataxia Telangiectasia 1ng years ago. There are still three people, three children from that study, that are taking this product monthly over 13 years. They do not have any steroid toxicity. We have about 70 children who have continued in open-label extension from the previous trial. They have been on it for about three years monthly, no toxicity. I already have a good, strong safety database to demonstrate that it can be given safely. The question is, can we prove efficacy? We're attempting to prove that by studying Ataxia Telangiectasia. If you're not familiar with it, it's a terrible pediatric genetic disease. It's an autosomal recessive disease caused by mutations in the ATM protein. That's an important protein for cellular proliferation and maturation and also has an important role in double-stranded DNA repair. There are about 5,000 kids in the U.S. with the disease. The phenotype is that the children at an early age, from the time of diagnosis, maybe between two and four years of age, start to get rapid neurological deterioration. They typically end up in a wheelchair by about the age of 10. In later years, they start to get infections and cancers. Their lifespan is typically in the mid-20s. There's nothing approved for this disease. They just get physical therapy, occupational therapy. They get treated for infections and cancers, but no disease-modifying therapies. This is a graph just showing you the progression of their neurological deterioration. You can see at the left side of the graph that at the time of diagnosis, between about ages two and four, they start to get deterioration. It is very rapid. It proceeds until they are about 10 or 12 when they are usually in a wheelchair. If you were designing a study to look at this over a six-month period, which is a relatively short period of time, what you would want to do is you would want to enroll kids around the green shaded region because those are the ones that are deteriorating most rapidly. That is your most sensitive ability to pick up a change versus placebo. That is what we are doing now. That is not what the previous company did. What they did was study ages six and above. This is very important because half of the children were of the ages of 10 and above. Half were six to nine in that green shaded region. What they saw in that study is that the overall population, that was, like I said, a half and half, they missed their p-value at 0.07. It was close. When you look at the population over 10, there was very little effect, as you would expect, because there is not a lot of neurological deterioration over six months in that population. When you looked at the younger population that was deteriorating rapidly, the effect size was extremely large over six months. The p-value was 0.009 for the FDA-specified endpoint. Just to put that in easier numbers to understand, that was a 28% difference relative to placebo over a six-month period. It is a pretty large magnitude of effect for this kind of outcome measure. That's what we're doing now is we're studying just that six to nine-year-old group in a six-month trial. It's monthly treatment for six months, a single dose of encapsulated versus placebo. We're about 60% enrolled in the trial right now. We'll do an enrollment update next week. This trial is under a Special Protocol Assessment with the FDA, which means that we have our priority agreement with the FDA that if it's positive, it can be a single study for approval. From a commercial perspective, we've done more epidemiology in this indication than anyone ever. There are about 4,600 patients diagnosed in the United States with this disorder. There are about 10,000 patients between the U.S. and Europe. As I said, there's nothing approved for this disease. This will be the first ever approved. If you look at comparable rare disease pricing, you're looking at the range of $400,000-$700,000 a year for a therapy like this, which ends up being a billion-dollar market size for this indication alone. We got this number of 4,600 by working with IQVIA and getting the ICD codes and then backing them up with SNOMED medical record review. It is a pretty solid number. As you can imagine, this is a steroid. If you could give a steroid chronically, of course, it would be great for lots of different diseases. Remember, you have to have your blood drawn. You have to come in every month, have your blood drawn, processed, and reinfused. It is not for mild asthma. It is not for psoriasis. If you have a serious disease, if you had really bad rheumatoid arthritis or lupus or something like that, it would be worth it. There is a long list of rare diseases where it is worth it to the patients to come in and get monthly therapy like this. Highest on that list would be Duchenne muscular dystrophy. Steroids, as you may know, are standard of care in that disease. There are other ASOs and gene therapies, but steroids are used in pretty much every child in DMD. They all have problems with toxicity. If you could have a steroid that does not have toxicity in that population, it would be a really big advancement. You have seen new steroids come out for that indication that have slightly different toxicology profiles. Their selling point is that they are not as toxic as their predecessor. This would be radically different. I mentioned we have a pretty long list of indications that eventually, given time and money, we would love to pursue. The list does not stop with just rare diseases. You could, for example, take the platform and encapsulate a different steroid, maybe betamethasone instead of dexamethasone. With that, you could pursue non-rare disease and have a different commercial market. You could take an enzyme therapy, put it inside a red blood cell. There are a lot of things you can do with the platform itself. Just to recap some of the highlights, we have enough money to get to data. We have enough money into 2026. That is the plan. We are a pretty small company. The company we acquired is in Italy. We have a team of about 15 people scattered throughout the United States. It is all about execution for this lead trial called the NEAT trial in A-T. I have got a list of milestones here that you can peruse. I will open it up to questions as I leave that slide up. Thank you for the overview, Dirk. I just wanted to see if there are questions in the room. One quick question about kind of the profile. You said that you need to hit a peak to get kind of that non-genomic effect of steroids. How frequently do you need to hit this peak? Is there a month interval kind of hold standards out what drives monthly dosing or? That's a good question. There's no good answer to it. There are genomic and non-genomic effects. The genomic effects are driven by persistent receptor occupation. Let me circle back to that because there's some really interesting data that isn't yet completely analyzed. I'll mention relative to the genomic effects. The non-genomic effects, it's not exactly clear what the time course of effect is for those. Those would be things like increased conduction across neurotransmitters or for neurotransmitters or increased turnover in the mitochondrial energy production pathway. I don't know exactly how long those last. Anecdotally, you'll hear from investigators that have experience with this technology that there's a short-term, very pronounced effect of the therapy over the first several days. There's a persistent effect over several weeks. Toward the end of the dosing interval, which is monthly, there's a window. It's like 21-30 days. They start to see a waning effect in that last week. How much of those effects are due to non-genomic versus genomic mechanisms is hard exactly to say. If we were to look at that graph you showed of the up and down of the daily dosing versus yours, is there a threshold where you need to be above to have an efficacy sufficient for long-term benefits? Yeah, that one. Yeah. This is what we know from studies done during COVID in ARDS is that they're most effective, at least in that indication, if you have a Cmax that's above 100 ng per mL. This is dexamethasone 6 mg. You can see that it approaches about 100 ng per mL. Our dose from our human volunteer study, I think, has a Cmax of 134 ng per mL. You're in the right range for Cmax. Cmax could go up to the multiple hundreds and still be safe. It seems like between 100 and 500, let's say, roughly, is a good Cmax to establish receptor saturation. That's what you need for the initial effect is receptor saturation. The metrics for receptor occupation over time are unknown and really hard to define and can't be measured via, for example, AUC because the drug distribution here is totally different than an IV injection. It's hard to compare one to the other. It's hard to say what a monthly AUC would be required for receptor occupation. All we know is that we think this satisfies it due to the long tail based on the clinical efficacy we've seen previously. You know it when you see it clinically. I think so. Before I forget, I want to mention you are asking about the genomic effects. One thing that we discovered was that the previous company had collected some PaxVax tubes in a number of patients in the previous trial. We examined the library. We did a quality assessment on the RNA. We found that we have a library of quantitative, we have RNA samples from 30 patients that have full outcome results and are valuable and have it at baseline, month two, and month six. These are trough samples a month after the previous dose. It is baseline, month two, month six. It is quantitative RNA for patients randomized to placebo, low dose, or high dose. Basically, what we have done is we have done transcriptomics on that and plotted everything out. We can see which genes are upregulated or downregulated and how that compares to a patient treated with placebo. In about a month, we should have results analyzed from that. What I can say is what I know right now is that there are a lot of interesting genes that are upregulated or downregulated. They fall into certain pathways. You see really cool stuff related to mitochondrial efficiency or neurotransmitters. Of course, antioxidative and anti-inflammatory pathways are greatly affected because it is a corticosteroid. We are looking at other stuff like is there an alternatively spliced form of ATM that might have partial activity, things like that. Interesting. I should have some results on that within probably a month and a half. Kind of piggyback on that dosing duration question, I saw that you guys are allowing dosing between 21 and 30 days. You have a spot with FDA. Obviously, they have to sign off on that. How does that work when we're talking about a labeled indication? Or how do you determine 21 versus 30? Does it matter? I think if you speak anecdotally to people, they would lean toward dosing every 21 days because, like I said, they believe that the effects, the families believe that the effects of the therapy start to wane in the last week. The label would reflect how it was dosed. It would be 21-30 days. Practically speaking, it's OK to have a window like that because it's on average once per month. These families have to, for the clinical trial, they have to travel more than they would in a commercial setting. That's what I thought of as the flexibility to get to the clinic. Yeah. Yeah, you need it. You can't do it like, OK, the Tuesday every four weeks. It just doesn't work that way. You have to give them a little bit of accommodation on getting to the clinic. A lot of the kids and the families are traveling for the clinical trial as well. It is more practical than it is precise. The dosing is not so precise. Remember that we're encapsulating, it's not like I'm giving you 6 mg of dexamethasone directly into your vein. It is not super precise. I'm encapsulating it into your red blood cells. There is some variability around the exact amount of drug that gets in. That kind of goes into my next question. What kind of assay work do you have to do with FDA to prove that you're giving what you say you're giving? How tight does that have to be? Because that's one of those black boxes that isn't an issue until it becomes an issue. Can you talk to us about those controls that you guys are working on already? Sure. The first thing I would say is one of the reasons we had the opportunity to buy this company after they worked on the technology for 20 years and spent $100 million is because they had to do a lot of that work. They had to prove to the FDA and the EMA. By the way, the device is CE marked in Europe. They had to do a lot of work around that, around showing that the device reproducibly does what it says it's supposed to do. It's not approved. It's approved as a device, but not for giving a drug to a human in Europe. With the FDA, they had to demonstrate those same things. Do you change the red blood cell? They had to look at membrane antigens. They had to look at size. They had to look at CBC parameters. They had to look at the amount of drug inside. There is a range. When you take 50 mL of blood and you encapsulate the dexamethasone, it's an average of 17.4 mg. You'll get a standard deviation of about ±3 mg, approximately. That is a range. I'm comfortable with the range because if you mapped those confidence intervals around, if you did a forest plot around this concentration time curve you're looking at here, you would still satisfy the theoretical requirements for corticosteroid efficacy. You would still avoid the toxicity thresholds. The other piece of evidence I'd point to that gives me comfort on that is that if you look back at that previous trial, that test trial, they did a dose ranging trial. They looked at low dose and high dose in placebo. The high dose was the 17.4 that we're using. The low dose was 8 in the low 8s, like 8.2 on average. If you look at the efficacy results, 8.2 worked. It was hard to choose between 8 and 17. If you look at the standard deviations of those two, they do not overlap. Those were definitely different doses. When we looked at secondary outcome measures and a lot of the secondary and tertiary analyses that we had to dig pretty deep, you did find signals that higher was better. Now I can say that looking at that RNA-seq data that I just mentioned a minute ago, higher does a lot more with respect to gene translation. At the buzzer, your phase III is running out, 4Q. We did not talk a lot about the endpoint. Maybe just very quickly, it is a scale and nothing available. If you are stat-sig, you should get approval. Nothing else available. Is there a clinically meaningful change or powering that you can talk about on what you want to see on that premise? Yes. This is an FDA-mandated subset of a neurological score called the ICARS. The ICARS is a 100-point scale. This is 29 of those 100 points. The FDA chose those primarily based on the fact that they reflect gait and posture. It is heavily, heavily weighted, like over 90% weighted toward the gait and posture domain of those 100 points. If you go back and look at historical results from the previous trials and look at different subsets of the ICARS, definitely this RMICARS, which is the primary endpoint, is the most sensitive indicator of patient function. It is meaningful to the patients because it is measuring things like, can you stand without swaying? Can you stand with your eyes closed? Can you walk without help? Do you need to put your hand on the wall? The magnitude of the difference I showed you, 28%, if you look at that and the difference of RMICARS points, it can basically mean the difference between walking autonomously and not walking autonomously in a six-month period. Clearly beneficial. Clearly beneficial. Clearly. You would guess that if you're measuring something like that, there are secondary benefits related to upper arm and speech and swallowing and things like that. OK. We'll have an update next week when you guys report your first quarter update. We'll see some RNA-seq data after that. Then we'll get completion enrollment and then data 4Q. Is that the right layout? That's the plan. It's going to be exciting 2025. Already is, right? Every day it's something. Yeah, we have a lot to talk about. We won't do that. Thank you so much for joining us. Thank you, everybody, for tuning in. We will see you tomorrow for day two. Thanks.