Contagious anymore, but just in case. All right, hello everyone. My name is Prakhar Agrawal. I'm a biotech analyst at Cantor. Welcome to day one of Cantor's Global Healthcare Conference, and for the next session, we are very excited to host the team of Sagimet Bio. Representing Sagimet today, we have Dave Happel, CEO, Dr. Eduardo Martins, CMO, and Rob D'Urso, SVP New Products. Gentlemen, thank you for making time. Thanks, Prakhar. Thank you. Maybe for folks who are not familiar with the company, just maybe start off with an overview of the company and the key priorities right now. Sure. So Sagimet is a clinical stage biopharmaceutical company that is targeting and focused on developing programs that blunt or inhibit fatty acid synthase or FASN. FASN is a rather ubiquitous enzyme within the body that functions as a regulator in particular organs and pathways. But when it becomes overexpressed or overactive, then bad things happen, as it does in the indications that we're pursuing primary development right now, which is in MASH, acne, and certain solid tumors in oncology that require FASN for progression of disease. The bulk of our work has been done in MASH and acne. In MASH, we've conducted preclinical and clinical studies that show much the same thing. That is that our lead program, our lead molecule, denifanstat, actually does a very effective job of normalizing and inhibiting FASN to normalize FASN levels and improve outcomes. We've demonstrated that in MASH by reducing fat, inflammation, and fibrosis, which are the three key drivers of the disease, and particularly as the patients advance in later stage of severity of disease. In acne, it's a much similar pathway. It may seem odd, but it's driven by fat accumulation, as it is in fatty liver disease, and the molecule has shown repeatedly in two large clinical studies, a phase two and a phase three, conducted by our partner in China, that denifanstat reduces lesions, both total and absolute inflammatory lesions, as well as improving IGA scores really at an unprecedented rate for a molecule, so what's ahead of us coming up here? Our near-term catalysts are that we're starting a phase one PK study in combination with resmetirom in the MASH space and in MASH patients, particularly in cirrhotic or F4 stage patients. That study will kick off here in the next few weeks. We expect to see data from that by the end of this year, beginning of next. It's a DDI study and a compatibility study. And we aren't expecting any significant surprises of that. But conducting that study is really in recognition that the market is moving towards combination therapy as a standard of care to treat MASH patients. And we have great preclinical data that I'm sure Eduardo will touch on here momentarily that show that when you combine the two molecules, there's a rather exaggerated effect in improving the health of the liver. And then in acne, we're taking our next-gen molecule, 3567, forward into a phase one study. We're halfway through that right now. We expect that to complete again by the end of this year, beginning of next. We would start a phase 2 program with this next-gen molecule in the first half, midpoint of next year. Okay, and maybe before we go into the specifics of the trials in acne and MASH, just give an overview of the mechanism in detail. How is FASN inhibition supposed to work? Sure, so FASN is a key enzyme in the pathway, sorry, in the cascade that converts sugars to fats. We call that de novo lipogenesis, and that happens more in the liver and in skin and some other places. Basically, sugars come in. There are several steps, and the key one being FASN, preventing then the formation of a very nasty fatty acid called palmitate. That's the main mechanism. Now, for MASH itself, that leads to a very profound defatting of the liver. However, in addition to that, FASN is critical for the activation of inflammatory cells and the activation of stellate cells that deposit the fibrosis, the fibrous tissue, so in the liver, we hit MASH in two ways. One, by defatting and the downstream benefits of that, but two, directly impacting the other two cells or the other two key events in MASH, inflammation and fibrosis, hence the results that we saw. Now, in acne, which is our new indication that we are pursuing with 3567, which is effectively a FASN inhibitor, so think about 3567. But in acne, the mechanism depends on FASN as well. So the production of fatty acids in the hair follicle, in particular sapienic acid, is dependent on FASN. So sorry, not hair follicle, I'm thinking skin. So in the pimple, the sapienic acid that is involved in the formation of the technical term pimple is inhibited, production is inhibited by fatty acid inhibition. And just a final comment on that, the effect on inflammation as well. So you're not only impacting the primary mechanism pathway for acne, but you're also impacting the inflammation that turns those pimples red. Okay. Super helpful. Maybe we should start with acne first, and then we'll move on to MASH. So you're testing TVB- 3567 in acne. How is it different from denifanstat? Mechanistically, obviously similar, but are there any differences between the two molecules? Chemically, they're just different chemical scaffolds. TVB-3567 appears to be a more potent version of denifanstat. So we'll end up using a lower dose, but the PK profiles importantly are starting to match up very nicely. So once we get through the phase one, and assuming we demonstrate that the PK of TVB-3567, different scaffold, different IP, we actually have a very nice IP window on TVB-3567 that can carry out to 2046, makes it highly attractive for pursuit and development. But the two molecules, we expect to function nearly identically. Okay. And recently, I think your China partner, Ascletis, had data from the phase three trial that they did in China. So walk us through some of the data and the key learnings from those readouts. Yeah. So our Ascletis partner just conducted a phase 3. It was a standard phase 3 acne study enrolled moderate to severe acne patients, looked at an endpoint at 12 weeks. And the data came back that all primary and secondary endpoints were statistically significant, which is fantastic. And the safety profile carried through very nicely. Product was well tolerated, really no unexpected side effects. And when we think about the relevance of that safety data and the efficacy data in the general acne market, our partner did a nice job and communicated in a press release comparing it to some recently approved products. And I think what we've found when we talk to dermatologists and people in the community is that the efficacy outcomes are significant and very clinically relevant for them, and the product offers a good option. Okay. And I think it's been a while before a drug has been approved in acne. So maybe if you can put into context the data that was seen versus what others have shown in this. Yeah. So as you said, so there hasn't been a new chemical in the oral market in acne as significant innovation for over 40 years. Most recently, the products have been mostly 505(b)(2)s and reformulations or fixed dose combinations. So this is really a novel mechanism of action that's offering a potential to reduce sebum. And when you think about the treatments that are available out there, there's really only one product oral that's available to reduce sebum, and that's Accutane and isotretinoin. And there's a lot of FDA challenges with that product, although it has a strong efficacy profile that makes it challenging for dermatologists to prescribe for everybody. And it's very limited just for cystic acne patients. And so oral FASN products really offer an option for that moderate to severe acne patient. What are the challenges with Accutane? Accutane challenges, it's regulated by a REMS program, an FDA iPLEDGE program, and so the dermatologist, the patient, and the pharmacist all have to be registered, and there are monthly lipid tests and pregnancy tests, so it really is a constrained market that people are using it for. Okay. And walk us through the safety and tolerability data because in the MASH phase two trial for denifanstat, which was the same mechanism, there were dry eye and hair thinning events that were seen. So what did you see in the acne portion of the trial? The drug was extremely well tolerated. We saw more dry eye on the placebo arm, actually. We didn't really see dry skin. Actually, if you were to get dry skin on the face, it's not a bad thing if you have acne. It's not the mechanism, but it's not a bad thing. We did see, you mentioned hair, one case of hair thinning, and that was on a placebo patient. Like we saw also in the phase 2B in MASH, we saw two placebo patients that were having hair thinning and two patients during screening. The drug is very well tolerated. The phase 2B in MASH that you're probably thinking of was the exception, was the outlier. We believe that this is because the study was conducted during COVID waves, early on, not the main lockdown pandemic, but during Omicron and the subsequent waves. As we know, COVID can cause that. Some patients took Paxlovid and the ritonavir and Paxlovid. The intent is to bring up the concentration of many drugs. There were other factors associated because before that, and this is the important thing, so not only we didn't see in the phase three in acne, but before that, we really only had three patients out of 200 and something, 300 patients that had any hair thinning issues. We believe really that TVB was the outlier. Just to get back, we had more dry eye on the placebo. The good thing is the placebo patients with eye drops, they did well. We helped some patients. Unfortunately, their acne did not improve. They were not on active drug. Okay, and as you move to the U.S. or more global trial, what gives you confidence on the translatability from the China data to the Western population? Sure. Acne is acne. There is no evidence that Chinese people with acne have any different mechanism than other ethnicities such as Caucasians, African Americans, and all that. The only thing that we have to do is a regulatory requirement. We need to match, reflect the U.S. population. So you can't have 100% Han Chinese in the study. So we do not expect anything different when it comes to the mechanism. And we do expect very good efficacy as we saw in the study in China. So it's a very good correlate for us. Okay. And any changes to the trial that was done in China, would you foresee? There will be similar. That's a good blueprint to follow, and studies in acne are usually 12 weeks anyway, so it's beautiful to follow something that was very well conducted and that had great results, if I may, so yeah. What could the development path look like in acne? I mean, and can you leverage some of the data that's been generated from China or just from the safety database for FASN inhibition in general? You mean the safety data from China? Yeah. Yeah, sure. The drug was very well tolerated. And 3567 is a FASN inhibitor. So we expect good tolerability as well. Yeah. Maybe on the commercial side in acne, just talk about the dynamics here, what's commonly used. As you mentioned, Accutane has more limited use. So how do you foresee the market developing? Yeah. So the U.S. acne market, it's a great opportunity. There's about 50 million Americans with acne. About 20%-30% of those people have moderate to severe acne. So figure about 10-15 million Americans suffer from moderate to severe acne. Of those, only 5.1 million are actively being treated by dermatologists. So of the 5 million people seeking treatment, about 70% of those are moderate to severe, which would be our indication. So we think that the opportunity here, and based on some early conversations we've had with dermatologists, that there's a large penetration ability to go into the current moderate to severe acne patients. And also because this is the first time in a long time that there'll be a new therapy out there, we'll also be able to expand the number of patients seeking treatment. We think that there'll be increased value per patient and also an increased number of patients. Do we know how much was Accutane doing in terms of sales before this? Yeah. So Accutane went generic and also got the REMS program put on the iPLEDGE REMS program. So prior to that, it peaked out about $1 billion-$1.3 billion just in the U.S. And that was in 2008. So it was quite some time ago. And the volume of Accutane now is just about 2 million prescriptions, which still represents a pretty sizable number of prescriptions being written by a product that's being regulated by a REMS program that requires all those things that we talked about. Right, and so why hasn't there been much more innovation in this market? Yeah. So dermatology companies really in acne have really relied on 505(b)(2) development, fixed dose combinations, bringing two novel or older agents into one novel product. I think the opportunity here is when you look at acne, you can look at surrogate disease states in derm, atopic dermatitis and psoriasis. So both of those conditions were being managed with branded generics, branded topicals, branded orals until these large molecules came in. And I think we're going to see that same development and same opportunity here in the acne market. We're going to see our product come in and the value per patient is going to go up and also the number of patients are going to. Right. And what do you foresee as the duration of therapy for a product like this? Because acne obviously can be episodic as well. Yep. So based on our research, typical moderate patients are coming back twice a year. Our label will be a 12-week label, just like all other oral acne products. But in initial conversations with dermatologists and kind of looking at their current prescribing of other oral agents, they'll probably use the product a little bit more extensively for longer periods of time to try and get higher remission or response rates. Okay. And is this an indication that longer term you could foresee commercializing yourself or you'll need a partner? Yes, absolutely. That's one of the reasons we brought Rob in is that his expertise in dermatology and particularly in acne over the last, what, 20 years has been, he's been a pretty devoted individual. So building it out in a space like this would not be that challenging if we choose to do that. Again, I would defer to Rob in his comment about the atopic derm and the psoriasis markets, which were both devoid of any real competition until the larger players jumped in, and we anticipate the same thing and to build that out from a commercial infrastructure would not be that challenging at all. Okay. I did want to talk about MASH, but maybe just one last question on the derm side. FASN inhibition, is there any other dermatology indication where it may work in? Yeah. It's a good question. We are looking at some other things. I'm not going to go into details. One, you have FASN inhibition. Let's go back to what the liver does. Inhibition of inflammatory cells. There are some inflammatory conditions on the skin that we could take advantage, not necessarily on the lipid side or not on the lipid side alone, but also on the inflammatory side of the equation. Yeah, we are looking at other things. Okay, and so in the MASH space for denifanstat, maybe before we talk about the specifics, there was a couple of weeks back, I would say some FDA comments regarding the increased positive perception about use of non-invasives in the development, so what's your thought around that? Sure. Yes. It was a change of heart, if you will. FDA clearly said that they are open to listening to proposals. Now, the important part is I had conversations with Echosens, the makers of FibroScan, and they reminded me that this is, for their device, a three-step process. So the LOI is the first step. It doesn't mean the FDA has changed to non-invasives, but what really has changed is until now, it was really a non-starter to propose a non-invasive study. Now they are opening, they have opened the door to, yes, you can propose a non-invasive. We're not promising we will approve. And definitely our intention is to have that conversation and try and see if we can run the studies that we have planned with non-invasive technology only. This would lower the costs. It would enroll faster. It would actually open other sites that don't have necessarily access to biopsy to being in the study. Patients prefer, of course, a needle versus a probe. The probe wins anytime. But this is where we are right now. And I think it's important because it's less than a page press release. All the information is not there. But yes, we will have conversations to explore and hopefully be successful with non-invasives. And finally on that and talking about our approach, we have breakthrough designation. And that allows us to request live meetings with the agency. And the agency has to help us design studies that have a higher likelihood of success. And I mean regulatory success, of course. Clinical success, we had very good results in the phase 2B. So I would imagine they would translate to a phase 3. Right. So when would the meeting happen? We have to finish the, and now I'm talking about the combination, denifanstat and resmetirom. We have to, first of all, and we are starting in the next few weeks or so, the drug-drug interaction study. This is mandatory for any new combination. The study will be concluded maybe end of this year, beginning of the next. Phase one studies, you can't really predict duration necessarily. Once it's done and we have all the analysis completed and those are mostly safety analysis, then we will ask the FDA for a meeting. I can't predict how long it will take to get the meeting because timelines are in flux right now with all the changes that are happening in the agency. Yeah. I did want to touch on the combination, but maybe on the monotherapy side, is that something you could explore as well on the non-invasive side? Oh, yes. Oh, Oh, absolutely. We can. Yeah. Without a doubt. If we were to, sorry, let me take a step back. Actually, from a timing perspective, because we have not started our trials, this came as, let me call it a gift to be able to have that conversation. If we had started biopsy studies, I would not be a happy camper right now, and the same applies to monotherapy as it applies to the combination. Yeah, absolutely. Got it. And on the resmetirom combination, based on what we know about how the drug is metabolized, can you just talk about would you expect any DDIs? No, I would not. There are two different CYP enzymes. So the way the drugs are metabolized are completely independent of each other, which means under any, well, under any normal circumstances that you're not going to see an interaction. In addition, both drugs are well tolerated. So we also don't expect any safety or new safety findings in those. And we did conduct preclinical studies and we did not see any issues with the animals. Right. And so no overlapping GI issues? No, no, no GI whatsoever. Actually, denifanstat does not have any GI toxicity, actually no bone toxicity, muscle, and the likes. So no important organs being targeted in a negative way. The liver is the most important organ in the body and it's impacted in a positive way by denifanstat. Once you complete the phase 1 study for the combination, what's the plan afterwards? Do you just go after F4 population, F2, F3? We can go after F2, F3 as well. Of course, what we have mentioned is F4 because those are the patients most in need. And a combination, which the whole field sees the future being combination. So a combination for an F4 is even more important. However, the reasons that lead us to believe that in people, the combination would be better than the parts also apply to non-cirrhotic. And if you can bring efficacy up, why not? Okay, and can you talk about the IP for this combination? Yeah. We have IP on the combination molecule with THR until 2044. We also have patents IP on the combination with FASN and GLPs and GLP analogs until 2044 as well. So yeah, it's a strong position. That covers just broadly the mechanism like FASN inhibition and that's a THR beta or is it like? Yes. Okay. So any THR-β, whether it's resmetirom or generic, would be applicable? That's correct. I think it's important to remember when you're thinking about the combination with denny and rez as well is that THR molecules, their mechanism, they actually elevate FASN levels over time. So at some point, one would speculate, certainly the scientific community does, that a FASN inhibitor may be required to ensure that patients reach treatment goals for improving liver health, and that's an important consideration as we look to combine these two mechanisms. How much incremental efficacy would you expect based on maybe some of the preclinical work that you have done? It would be a synergistic effect. There are no animal experiments that say, okay, this happened, therefore this is how much the magnitude in people. But we expect to see more than the sum of the parts. I think if we look at the phase 2B study in combination with patients who were on background GLPs, which was roughly 10% of the population, we had an extremely magnified effect for those patients that were introduced to denifanstat that were on background GLP and to the tune of about a 42% placebo-adjusted differential in fibrosis reduction. And that's quite significant. Now, we didn't see quite that change in the preclinical model with sema, but it certainly translated forward into humans. And I think it makes sense when you're combining. Let's remember that denifanstat is really the only fat inhibitor in development in this space. Everything else is a fat burner of some variety, whether it's an oxidizer or a mobilizer. They work primarily by burning fat. Combining this fat inhibitor with a fat burner has already proven to have an outsized effect in reducing fibrosis. And we expect to see the same thing with resmetirom in combination. Got it. Interesting. And so maybe just one final question. Remind us about the cash runway and what does it cover? We reported our last earnings that we have approximately $135 million in cash that carries us forward until the beginning of 2028, which will allow us to complete the phase 2b biopsy if a biopsy is required with resmetirom in F4s to get to that interim result. And it also allows us to continue to move forward our next-gen molecule 3567 in acne. We're really pleased about where we're at. Okay. All right. That's all the time we have today, but thank you to the Sagimet team for joining us and thank you to the audience for listening in. Thank you for. Thank you for your call.