Hi, everyone. Welcome to our Fireside Chat with Surrozen. My name is Jennifer Kim. I'm one of the biotech analysts here at Cantor, and I'm excited to welcome. And we should mention their Phase III study is DME only at this stage, at least and Yang Li, E VP of Research. Thank you both for being here. So maybe we can start off. Could you introduce yourselves and give a quick overview of the company? Sure. So first of all, I want to thank you for inviting Surrozen here to attend the conference. So I'm Charles Williams. I'm the CFO and COO. I'm Yang Li, EVP, Head of Research at Surrozen. We're a South San Francisco biotech-based company. We were founded in 2016 by The Column Group, along with some of the discoverers of the Wnt pathway. Our initial mission was to exploit the full potential of Wnt as a therapeutic. Currently, we're focused on multitargeted product candidates in retinal vascular disorders. We have two lead programs, 8141, which combines Frizzled-4 and VEGF, and then also we have 8143, which combines Frizzled-4, VEGF, and IL-6. OK, so for people who are less familiar, can you explain what is the Wnt pathway? Sure. I think for years, Wnt had promised as a therapeutic, but was challenging to drug. I mean, we'll get into a little bit more about the challenges and what Yang Li overcome some of the limitations of doing so, but ultimately, it's a highly conserved pathway that plays an essential role in the maintenance, repair, renewal of tissues, and in particular, vascular and barrier repair, and so we set out to tackle that challenge to make therapeutic, but make a meaningful difference for patients. OK, maybe we can go into the challenges. So the Wnt pathway, I think historically has had some challenges, particularly around safety. So this might be a question for Yang, but how have you come to consider yourselves as sort of the experts in this biology? And what has been your approach to overcoming those challenges? Yes, the Wnt pathway was discovered a long time ago, actually by our founder, Harold Varmus, who was a biologist and former NIH director, and also a Stanford professor, Breakthrough Prize winner. So we've been very fortunate to work with leaders in the field, the founders of the field, for the past nine, 10 years from the initial founding. This pathway, even though it was recognized very early on that it's very important for tissue regeneration and renewal, as Charles alluded to, has been considered undruggable for decades because the challenges working with the ligands, they're just you just can't make them. So it has been very challenging from that perspective to develop therapeutics based on this pathway. One of the breakthroughs in this field actually came from one of our founders, Chris Garcia's laboratory at Stanford, where he invented a concept of Wnt surrogate using bispecifics to engage receptors, and that kind of has been the foundation technology for us to begin with. We've taken that finding from our founder's lab and took it one step further. We've done very thorough analysis very early on, trying to figure out what really makes it work when we turn this into antibody-based therapeutics, and through these earlier, very careful analyses and work, we discovered, in addition, a multi-layered engagement of the receptor that actually turned out to be a critical parameter to really activate the signal using these novel antibody-based therapeutics. And this is how we developed our proprietary SWAP technology platform, which is the Wnt mimetic platform, and also gave us a very broad IP that we have been issued recently this year as well. And so combining this technology with the ability to target very specific receptors and being able to localize where the drug could potentially be, especially in the eye, for example, allow us to reduce the unwanted atrophic effect, but focus on delivering the therapeutics to the right tissue in the right place. It is often, I guess, kind of not well appreciated. There's actually a drug that has been approved for this pathway, and that's the Amgen bone drug, denosumab, sorry, Evenity. That's turning on this Wnt signaling pathway via removing an inhibitor of the pathway as well. And that has been approved since 2019. It's been in the current thing, helping patients for many years already. And also looking at the EyeBio data, they show very good safety and tolerability in a clinical study as well. So it is definitely feasible to target this pathway, activating the pathway to get very effective therapeutics out of this pathway in a safe manner as well. OK, that's a great overview. So you mentioned this earlier. Your focus is now sort of pivoted to the ophthalmology pipeline or retina specifically. What led to that decision earlier this year? So we had our lead molecule at the time was SZN-043, which was severe alcoholic hepatitis. I think ultimately the stars aligned a bit, if you could say that, that as we were moving through that program, we realized how challenging that patient population was to treat. And so I think ultimately we came to the conclusion that the time and funding required to move that program would be challenging as a small company. We still think a company that's well-resourced and well-funded could potentially move that forward. But there was significant interest in moving our ophthalmology programs forward, validated by what EyeBio had generated the data the previous year, as well as obviously the Merck transaction. And so ultimately it led us to make that change, which I think was confirmed with the recent $175 million financing that we completed. Since the pivot, can you just talk through what you've done to build up the expertise? Sure. Yeah. So we recently hired Dan Chao. He's a card-carrying ophthalmologist, PhD, MD. He used to actually practice. And I think what he brings is he came from Johnson & Johnson. So he brings a plethora of experience, but also importantly, the relationships with the KOLs. We also recently brought together our clinical advisory board and some of the who's who in ophthalmology, which we announced earlier about a month ago. And so I think not only do we have the clinical advisory board, but obviously Dan brings a broad array of relationships that we can tap into as we think about developing this program and designing the clinical. It's a good advisory board. Yeah, so familiar faces. So maybe go back to the pathway. Can you talk through why the or how the Wnt pathway is mechanistically relevant in retinal disease? And you've touched on this, but how and where has it been validated? Sure, I'll be happy to do that. The Frizzled-4, LRP5 pathway has been shown during development to be critical for the formation of this intricate retinal vascular structure, and also in adult tissue, this pathway is really critical to maintain the integrity and the barrier function of vessels as well. The dysregulation of this pathway, for example, human genetic mutations in the pathway, the loss of functions have resulted in retinopathies such as Norrie disease or FEVR. These patients present phenotypes that are similar to DR or diabetic retinopathy or DME. This pathway mechanistically definitely makes a lot of sense for treating retinal diseases. With the recent data from EyeBio that they presented last year, further validated this pathway, certainly in the clinic now, human, especially DME patients. We're very excited to continue to develop this pathway. Our current compound, SZN-8141, not only engages this Frizzled-4, LRP5 pathway similar to the EyeBio compound, but we'll also add the standard-of-care anti-VEGF to the molecule as well. So it's a combination of two pathways together, which is why there's a lot of excitement around. And this is certainly, I think, aligned with what people are interested in, the strategics they consider attractive approach is to combine multiple pathways together to tackle this disease. Can you sort of place that data into context? The now Merck, but previously EyeBio asset, you put the data that they've shown, I think it was just Phase I, II trial, but what did we see in DME, smaller data set in wet AMD? And And why do you think it generated the buzz that it did? Sure. So it was 26 patients of data, 12-week study. They demonstrated visual acuity gains of approximately a little over 11 letters over those 12 weeks and a decrease in, as measured by CST, 143 microns. I think as you put that in perspective of historic clinical trials, they're at or around or even potentially better than what others have done, albeit a small study. I think as we talk to KOLs and do our market research, the KOLs are looking for alternative mechanisms of action. I mean, most markets have the ability to switch MOAs, right? And so either one, it could potentially be first-line therapy, but importantly, the literature suggests there's 30%-50% of patients who suboptimally respond to VEGF. So it gives them another tool in their armamentarium to potentially educate patients who don't respond as well. And then in terms of specific indications, where does targeting Wnt signaling, and maybe specifically Frizzled-4 and LRP5, make perhaps more or less sense? Sure. So as I mentioned, this pathway is very important for vascular integrity and barrier function. And this is totally relevant in wet AMD and diabetic macular edema, which is characterized by pathological angiogenesis and barrier function breakdown. So it makes a lot of sense from that perspective to tackle those diseases. The EyeBio data certainly has validated this pathway in the clinic in addition to the human genetics, as I mentioned. So we would consider the DME side fully validated now for this pathway. On the wet AMD side, as Charles alluded to, they didn't really do a full study with the pathway as a monotherapy. But we have generated data ourselves in a preclinical setting that supports the use of Frizzled-4 activator in wet AMD as well. And also there are other literature evidence pointing to supporting that also. What is interesting to us is even though there are only a few patients that EyeBio study treated with, in their case, actually it's not a monotherapy, it's a combination with anti-VEGF. If you look into the data, I think it's tantalizing to speculate perhaps that they actually have some evidence supporting at least our approach, which is to combine Frizzled-4 activation with anti-VEGF. So we're very excited to explore our molecule in both indications. Yeah, I know they have Phase II, Phase DME only, but you mentioned you're interested in both indications, so that is a good segue to your lead candidates, SZN-8141, SZN-8143. Can you just talk us through what those assets are and where do things stand currently? Sure. So as I mentioned before, 8141 combines Frizzled-4 and VEGF. 8143 combines Frizzled-4, VEGF, and IL-6. 8141 is currently in CMC development. We've publicly guided that we'll file an IND sometime next year. As it relates to 8143, Yang and the team are working to nominate a potential lead candidate. And so we'll provide some more specifics around the progress of that program once we have more visibility to the lead program. OK, and then outside of maybe the targets, are there any other key differences between your assets and then the Merck or EyeBio asset? And how would that hopefully translate meaningfully? So the EyeBio asset and the Merck asset, as I mentioned, target Frizzled-4, LRP5, and it only activates the Frizzled-4 signaling for that particular molecule. Now, our first candidate compound is SZN-8141. The difference is that in addition to activating Frizzled-4 pathway, we'll also add the anti-VEGF component to it. So we're targeting multiple pathways with that molecule. Comparing just the Frizzled-4 side, the Frizzled-4 activation side to the Merck compound, we believe we have at least in vitro, when we compare these molecules, we have higher potency and efficacy. So that could potentially in itself translate to some benefits in efficacy and durability. We also feel our compound, we actually painstakingly went through the engineering characterization. So we know we can concentrate to a much higher concentration levels, which allows us to dose at higher doses in the clinic. Our data shows that there's potential synergy between the pathways. So maybe we don't need to go very high doses, but this does give us opportunity to explore wide dose range. And that also can bring more durability if we can deliver more drug into the patient eye. And again, as I mentioned, we have pre-clinical data suggesting there is synergy between the two so that would increase the potency and potential efficacy as well. And another difference is we can go after both Wnt and DME. And we should mention their Phase III study is DME only at this stage, at least. So we do believe that there's a lot of differentiation between these molecules. And we're excited to bring this forward into the clinic and see what we can do with some of the pre-clinical observation that we have can translate to benefits in the clinic. SZN-8143, Charles alluded to already, added on additionally IL-6. So we feel this molecule could potentially bring to more patients, including inflammation-driven diseases such as uveitic macular edema in addition to DME and wet AMD. OK, so you talked about better potency on the Frizzled-4 side and how that might translate to better durability. Can we narrow in on maybe the VEGF component specifically? And can you talk about how we should think about, like you mentioned, it is standard of care in wet AMD and DME? Is there a way to compare the potency there compared to the approved therapies? Sure. So as I mentioned, we are able to concentrate our molecule to a much higher concentration. And based on our current calculations, we can deliver the molecule SZN-8141 into the patient's eye at equivalent molar concentration-wise to a standard Eylea or multiples of a standard Eylea already. But given what we have seen in the pre-clinical setting, we may not need to go there because of the synergy that we have found. So this does give us a wide range of doses that we can try in the clinic that may still result in the benefit that we ultimately hope to see, which is improvement in visual acuity, improvement anatomical of the tissue, and also durability. So we'll see if that will translate. It's important to note we actually use the Eylea sequence in our molecule. OK, that's good, and then 8143, what can you say about the IL-6 component? The IL-6 component, we've engineered that component ourselves as a new sequence, and compared to, let's say, what has been in the clinic, for example, the Genentech sequence, the marketed, affinity-wise, it's very comparable in terms of cytokine binding, IL-6 binding. We combine 8143. Again, in addition to IL-6, we have Frizzled-4 activation and anti-VEGF, so we believe the combination of the three pathways together would yield probably better potency and additional benefits beyond the IL-6 monotherapy alone, so again, we're very excited to move that one forward as well. Can you talk a bit more about the evidence that you've shown to support that potential? Sure. In the pre-clinical setting, as I mentioned, I mean, there are many benefits that we can bring already in addition to just compared to the Merck compound, in addition to being more potent on the Frizzled-4 portion, and also the doses that we can go up to, that's higher. In the pre-clinical setting, we have seen that there are several models we have established in-house. For example, in the OIR model, we have seen both benefits in terms of suppressing the neovascular tuft formation to the same extent as anti-VEGF therapies, IVT, but we're able to regenerate vessel in that setting that obviously has not been seen for anti-VEGF molecules, and also there are other differences that we have seen that we can dive into detail for. People may be interested in this including improvement in potency that we have seen because of the synergy between the two pathways and also other benefits. We also have established other models that represent the wet AMD side of the disease, various DME models. In that setting, again, with combination, it worked really well and much better than monotherapy alone. So we're very excited. Hopefully, some of these will translate. But if you look at the molecule that had gone in, some of these effects in these models will translate into humans for other molecules. Is there a way to think about the read-throughs that we can make from updates from the Merck program? Sure. I mean, I think pharmacologically we're doing the same thing. But as Yang alluded to, we have some differences in our biophysical characteristics, whether it be potency, ability to concentrate higher. And obviously, we're adding the VEGF component to it as well. So obviously, we have our eye on the data, but we'll have to see what the data says and sift through it to understand what any translation to our molecule might be. Just comparing it to those existing programs, is the bar here the durability angle? Or really, what are you doing to try to differentiate yourself? Yeah, well, I think, I mean, durability could be one, but I think there are multiple aspects of the molecule that could differentiate. Again, we'll have to prove that out in the clinic. But given the potency, given the ability to concentrate, durability certainly could be one of them. I think another one could be anatomical changes, given the mechanism of action in Frizzled-4 and the potential to repair the retinal vasculature and the synergy and complementarity of the anti-angiogenic properties of VEGF. And so I think those are two pieces where we could potentially differentiate. Obviously, ideally, you'd want to potentially differentiate on BCVA, but we recognize that's a challenging endpoint to differentiate on. And what we've seen in the market with the Vabysmo is incremental improvements over the standard of care translate into significant commercial success. The Vabysmo has been wildly successful, not only in terms of the messaging around drying the eye, which is anatomical changes, but also some of the incremental durability that they've been able to prove in-house. OK, so the focus is on those two standalone programs. You have a few other programs. Even before the pivot, you had a partner or you have a partnered program with SZN-413. That's Frizzled-4. Where do things stand there? And then can you just walk through what that partnership looks like? Sure. So first and foremost, we did that deal back in, I think it was 2022, $12.5 million upfront, up to $590 million in additional milestones with single-digit royalties to low double-digit royalties. I think importantly, the scope of the license actually is pretty narrow in that they've licensed a specific format. And in fact, we can use their same sequence in our molecule once we attach VEGF for IL-6. So that's number one. Number two is we don't have a whole lot of visibility. This is a straight-out license. What we do know is that they're committed to moving the program forward. And certainly, given we're using the same sequence in our molecules, it does have some potential read-through to what the impact of our combination molecules might be. OK, fair enough. And you mentioned IND for the first program next year. Are there any more specifics you can outline in terms of timelines? And I guess after the IND, how quickly do you think you can move in terms of showing your own clinical validation? Yeah, I think what we'll do is once we get closer to the IND, we'll provide some more specific guidance in terms of when we would initiate the Phase I, Phase II, Phase IIa clinical trial and provide an update around data. But it's a little early yet. We're working through the design of the clinical trial right now. Obviously, the ophthalmology team just started. So they're sifting through that and thinking through what the best design of that would be. But in terms of key activities currently, SZN-8141 is in CMC development. I think they're progressing. We'll have the IND enabling study for them ultimately to file the IND. Do you think we'll get any updates on 8143? Certainly, I think, as I mentioned, Yang and his team are working pretty closely to nominate a lead compound, and I think once we have visibility around that, we'll provide some more specifics around that molecule. OK, and then just looking ahead, a clinical program, whether it's wet AMD, DME, and with the IL-6 asset, maybe UME, how are you thinking about what that program could look like? And could you just outline the different market opportunities and needs? Sure. So I think so first and foremost, SZN-8141 and SZN-8143, we still have some thinking to do on how to position those molecules, given there's certainly overlap with what we're targeting. One could be that the SZN-8143 is effectively we go after more inflammatory-driven diseases like UME, uveitis, et cetera. But it also could just be a more better version of SZN-8141, given there is an inflammatory component to wet AMD and DME. And so that's some strategic thinking that we're currently ongoing. And we'll certainly provide an update as we continue to think about that. As it relates to differentiation, as you may know, there's an ASRS survey. We talk to KOLs all the time. I think a couple of things they're looking for. They're looking for, obviously, longer duration of therapy. They're looking for alternative MOAs. And they're also looking for molecules that demonstrate anatomical changes. And so those are some of the features that we think our molecules are well-suited to meet in terms of the unmet needs of the market. OK, and is it fair to say that Frizzled-4 is maybe the most clearly validated target so far? Or are there any read-throughs one can make to other targets you're also exploring outside of wet AMD and DME indications? Certainly, Frizzled-4 is clinically validated, given the recent proof-of-concept data. EyeBio reported out last year. We do have a SZN-127 molecule that has shown really compelling preclinical results and preclinical models of geographic atrophy, Fuchs. And then also we're thinking about potential orphan ophthalmology indications for that molecule as well. How are you thinking about those other programs in terms of prioritization? I think right now we're focused on 8141 and 8143, and I think once we continue to make progress, we'll update the public around what we plan to do with the SZN- 127 molecule. OK, Yang, you mentioned the IP point before, but can you just remind us what the IP situation is? Sure. We granted a pretty broad claim for this multivalent engagement receptors in terms of activating the pathway. Beyond this Frizzled-4, it's all Wnt activation. And so we're very excited to obtain that. This shows the early work that we have done, how thorough that we have gone into the analysis and the optimization that we have gone. And this could potentially cover some of the molecules that others have been approaching in the field. So we're interested to see how that pans out in terms of whether we encourage folks to work with us and bring more molecules in this field moving forward. Yeah, and I'd say that the specific claims around multivalent antibodies that target Frizzled and LRP5/6, which is what Roche and Merck do. I'd also note that post the Merck acquisition, this particular patent was cited as prior art. And Merck subsequently, by the patent office, withdrew their application. So we're feeling pretty good about that patent issuing earlier this year. I expect that to be an interesting part of the story going forward. Just as a last question, can you just remind us what your balance sheet and runway looks like and sort of summarize the key catalysts investors should look out for? Sure. So we did $175 million financing earlier this year, $76 million upfront, which gets us through the IND filing. And then there'll be about another $98 million coming on the second tranche, which will fund us through the Phase I, Phase IIa trials for both 8141 and 8143. OK, and you have not outlined the design for the Phase I? We have not, no. I mean, as a baseline, EyeBio provides a good framework. I think some of what we're thinking about is maybe a broader additional patients in wet AMD. Obviously, they only did a handful. But I think it'll be important to ascertain what the impact of our molecule is on wet AMD, given the combination. OK, looking forward to it. Charles, Yang, thank you so much for joining us. Thank you. Thanks everyone.