Great. Welcome back, everyone, to another session here at Oppenheimer's 35th Annual Life Sciences Healthcare Conference. I'm Leland Groeschel, one of the research analysts on the biotech team here at Oppenheimer, and really delighted to have with us Jesse Shefferman, who is co-founder and CEO of Protara Therapeutics. Ticker is TARA. We've been covering this company for some time now and really, really like it, not only for its opportunity in non-muscle invasive bladder cancer, but also in a couple of other indications as well. Welcome, Jesse, and looking forward to a nice fireside chat here with you. Thanks, Leland. Happy to be here. Thank you to the whole Oppenheimer team for having us. Absolutely. For those in the audience, feel free to submit any questions you'd like, and I can work those into our discussion. As I sort of alluded to, NMIBC has kind of been, I guess, at least an investor focus for Protara. Maybe for those who are newer to the story, if you can share kind of what your approach is to this area that's become of great interest to the investment community, given the dynamism in the development world that's been happening for NMIBC. Yeah. Maybe it makes sense to just really spend 30 seconds delineating sort of the different buckets, if you will, of where patients fall in the NMIBC setting. We know that bladder cancer broadly is the sixth most prevalent cancer in the United States, and NMIBC is about 75% of all of those cases. Within the NMIBC setting, roughly 30%-40%, depending on whose literature you cite, are in the high-risk, high-grade category with either sort of high risk from a focality perspective or size of tumor or high grade from a histology perspective. That is really where we are focused with a registrationally designed phase II study called ADVANCE2 in BCG-unresponsive patients with or without CIS. There are other areas that are of interest to us. BCG-naïve is an area that is of interest. We recently published data in December of this past year in both BCG-unresponsive patients and BCG-naïve patients. We were the first sponsor to actually publish data in high-risk, high-grade BCG-naïve patients. In that setting, the standard of care is the BCG vaccine. It is the TB vaccine, Mycobacterium bovis. It's been the standard of care for years, perpetually in shortage, and not a particularly great drug. From our perspective, there's an opportunity in the BCG-naïve setting. We'll talk more about that, I guess, as we get through this conversation. Finally, there is a preponderance of patients with non-muscle invasive bladder cancer that have low grade or intermediate risk. These patients are highly recurrent, but their histology and/or sort of risk dynamics are such that what you're looking to do there is prevent recurrence of the disease, whereas in the high-risk, high-grade setting, you're also looking to prevent recurrence, but more so looking to prevent progression and ultimately removal of the bladder cystectomy. You will hear a lot of this nomenclature when you talk about NMIBC. To us, it's for just non-muscle invasive, low grade, intermediate, naive, and unresponsive. Got it. Obviously, BCG has really established a standard of care for the higher grade NMIBC. It also has been having shortages in the marketplace. Tara-002, I mean, it looks to be kind of a next-gen sort of BCG in a way. It's working through immunopotentiation, which is how BCG works, but it also has some differences. Maybe we'll go into a little bit of detail on how this strep pyogenes derivation is kind of super sort of prepared to do its function. I'll break that into two answers. The first is just sort of what's the core biology here? And then sort of downstream from that, how is it presented, OO2, as a product, if you will, or as a therapeutic? Because there are differences in the two. As you stated, OO2 was originally developed from a genetically distinct strain of Streptococcus pyogenes in Japan. Once it was sort of developed almost in sort of a Mendelian genetic fashion bred to be low virulence, Chugai Pharmaceuticals devised a manufacturing technique to completely inactivate the bug. Let's come back to that because inactivated versus attenuated is a major difference between OO2 and BCG. Core biology is different, though. BCG is a TLR4 activator and tends to preferentially upregulate IL-6 and IL-1 beta. These are pro-inflammatory kind of TH1 type immune signaling cytokines. 002, in addition to IL-6 and IL-1 beta, very preferentially upregulates TNF alpha, interferon gamma, and IL-12, which are also more associated with that sort of pro-inflammatory cytokine response, which is associated with recruiting CD8 positive T cells and NK cells to come and do the real heavy lifting in the tumor microenvironment. Another interesting component just on the core biology, 002 downregulates IL-8. BCG upregulates IL-8. IL-8 actually is associated with driving recurrence. While BCG treats NMIBC via sort of the immune cascade, there's also a component where it works against itself. We know that about TLR4 activators. While we're not only driving a pro-inflammatory anti-tumor response, we're also upregulating or rather downregulating a key cytokine that is associated with recurrence. That's sort of the biologic difference. There's more details. BCG is a granulomatous type of inflammation. 002 is less so. That's behind a better tolerability profile. Where we really think the future for 002 lies is in its difference in terms of inactivation versus attenuation. Because 002 is inactivated, the vast majority of experience in cancer patients, and just as a reminder, 002's Japanese predecessor, OK-432, is approved in Japan for lung, gastric, head, neck, and thyroid cancer and has a safety database of about 250,000 cancer patients. Because 002 is inactivated, you can administer it systemically over and over again. BCG, because it's attenuated, you can really only administer perhaps one dose, which is sort of the TB vaccine manifestation of BCG. As we look at what does the future hold for 002, that systemic capability is very intriguing and a potential for us to sort of differentiate significantly from the competitive landscape, which, of course, is where we spend a lot of our time. Great. I think you had mentioned earlier that these patients, many become BCG refractory or they're unresponsive. There is a lot of kind of cycling back to their urologists for either other treatments or repeated surgeries, so-called TURBT procedures, transurethral resection of bladder tumor. What does that sort of look like? What's that landscape today in terms of kind of that population with recurrent disease? Yeah. You know, I think our best evidence at Protara really is down to our experience with the BCG refractory patients that we have treated to date. On average, the patients that we've treated have cycled through multiple different therapies. In fact, we are now enrolling patients that have failed investigational and recently approved sort of innovative monotherapies. I think that just taking a step back, that should make sense, right. If you've run out of options in the high-risk, high-grade setting, your sort of last step is cystectomy. There are not very many people on the planet that would not avoid cystectomy if there was an opportunity. I think we all envision a world where there are all of these sort of agents, whether they're advanced chemotherapeutics, targeted immunotherapies, or TARA-002, a broad immunopotentiator, where you would cycle through multiple different options that would convey incremental benefit in order to stave off cystectomy. I think there's a world out there where patients are dying of natural causes before they are dying of either advanced bladder cancer or complications from cystectomy. Absolutely. Last year, you started to unveil data from your clinical work with TARA-002 and NMIBC. Review with us, kind of you had an initial release, and then you kind of had some longer-term follow-up. You started to do reinduction, which is, I think, a key element here. Maybe you could walk us through what those data have shown. Yeah, sure. We enrolled our first patient in the ADVANCE2 program, which, as I said, has the B cohort, which is designed to be registrational based on the FDA's 2018 guidance reaffirmed in 2024. It's the same study that everybody else is doing in BCG-unresponsive. We also have that proof of concept arm of about 27 naïves. We'll probably over-enroll that a little bit because we face a lot of demand from urologists in the U.S. for the naïve setting. Our view is, in the BCG-unresponsive setting, what we observed, we enrolled our first patient in September of 2023. In April, we were able to evaluate 16 patients at the three-month time point. Interestingly, when we first got into this NMIBC world, three months is a really important time point. You want to be able to, at that first look in the bladder post-treatment, be able to tell that patient, "I don't see any cancer," right. We don't have RECIST criteria in the NMIBC setting, right. It is a binary call, and you want to be able to make that call early. TARA-002's onset of peak therapeutic effect, because there are multiple different cytokines and chemokines that we're activating and employing before we get to peak sort of recruitment of cytotoxic T cells and NK cells. Our three-month data, we've always known, was not going to be where our strength lied. It would be, as we said at the time, after a patient has received multiple doses. In reality, if a patient has residual CIS at the three-month time point, docs don't stop using whatever they're using, and that might be BCG or gem or whatever. They keep going. We, at the time, felt like our objective was to articulate to the market that the drug was active. Because remember, this was the first data that we had ever published in the NMIBC study. What we demonstrated was a 43% complete response rate in BCG-unresponsive patients and about a 38% complete response rate overall, right. Those are not competitive numbers. We knew that with reinduction and with continued dosing, because of the kinetics of 002, we were likely to see better six-month response rates. Fast forward to December when we published on 20 patients, 15 naïve, 5 unresponsive. In that setting, across all patients, we observed a complete response rate at any time of 70% and a landmark CR rate of 72%. In the unresponsives, CR at any time was 80%, and CR at six months was 100%, meaning we were able, through reinduction, to get all of the unresponsive patients to CR at six months. Our numbers in the naive setting were 64 and 67. Competitive no matter kind of how you look at it. It was gratifying, obviously, to have that thesis of, "Hey, look, you just got to keep dosing these patients. This is a really safe, really well-tolerated product, but it takes time to achieve its peak therapeutic effect. Right. Before we move on to some of your other pipeline opportunities, maybe just touch on, I think, a very important aspect of 002 is just its ease of handling. You have some others in the space who kind of have more kind of laborious kind of logistics, maybe just to touch on those if you mind. Yeah. TARA-002 is among the easiest of all of these investigational or recently approved products to administer. We have three-year stability in normal refrigeration. There's no thaw time. A vial is reconstituted in saline, injected via Foley catheter. There are no dwell time requirements. I mean, obviously, the longer the dwell time, the better. The patient can leave the table without having seen the doctor. This can all be done with a nurse. Because its sort of take-up into the tumor cell is through endocytosis, it's not fibronectin, those patients don't have to stick around. Also, because it's not attenuated, it's inactivated, there's no risk of sort of downstream BCGiosis or septic kind of sequelae, if you will. Those patients can actually go home. They don't have to bleach their urine. There are a lot of aspects of this that are among the most easy to administer. As we think about this, there's sort of kind of been two plausible investment cases that have emerged in investigational products, right. There's the low burden, right. Then over here, there's complex but high response rates. Our view is that we're sort of ticking both of those boxes. That, to us, is a really important piece. We've always sort of been oriented towards the community. That is where about, according to claims anyway, 80% of all intravesical therapeutics are administered. Our profile, along with our very, very, very low cost of goods sold, creates a lot of opportunity to gain share in that setting. Great. Great. Yeah. These same cells, 002, they've shown, I think, an extensive database from the outside in this very rare disorder, lymphatic malformations. You're taking it forward there. I know it's been a little bit slow coming. FDA's been, the division was busy, even though there was a vaccine division with COVID. Here you are, I think, in a registration study. Elizabeth, if you wouldn't mind kind of running us over the high points of the LM study. Yeah. I want to be clear that it's not registrational, but we want to make the case that it's registrational. The FDA hasn't confirmed, but look, it fits every single criteria that Peter Marks has recently laid out as head of CBER for what an accelerated approval could look like. We certainly feel we have the grounds to ask, but we don't want to make the claim that it's registrational yet, but sure feels like it could be. There, it's about 36-ish patients divided into sort of multiple cohorts. Because we're talking about PEDs and sort of very sensitive architecture around the head and neck where these lymphatic malformations occur, the FDA has asked us to treat safety sentinels of three patients in three different descending age categories before we clear safety there, and then you can enroll for the efficacy population at that age category. They started us at ages 6 to 18. Yeah, it has been slow going because if you think about it, if you're 18 years old and you still have a lymphatic malformation, you have low urgency for treatment. It did take us some time to enroll that safety sentinel. We got through it, treated two patients. One patient was misdiagnosed. They actually had a rare form of cancer, which we found out after the fact. The two patients that we treated with sort of head and neck malformations achieved a complete response after a single dose, which is reflective of the experience in Japan. The good news as it relates to enrollment is the closer you get in age categories to sort of entering school, there's profound urgency to treat. We are happy to sort of kind of let you know that we have got a backlog that far outnumbers the number of patients that we can take in in the last two safety sentinels, ages six to two and two to six months. You should see the news flow out of the single-arm study emerging in 2025 as we are seeing a lot of our enrollment accelerate there. Right. Assuming you get approval of this, then you'd be eligible for the PRV. The voucher could be either monetizable or used for whatever purposes. Others have, I mean, this is a space where people maybe didn't really know this from a kind of investor perspective. There have been other companies that have jumped in. I mean, you guys, I think maybe a bit of a broader scope, macro versus microcystic lesions. Maybe you go into that a little bit for those who aren't aware. Yeah. Macrocystic lesions, let's take a step back. Lymphatic malformations tend to sort of manifest in three different phenotypes. Microcystic is a, again, it's the same kind of gain-of-function mutation in the AKT-PI3K-MTOR pathway. Those are very fleshy, low luminal space, kind of solid malformations. We don't do a great job with those because 002 is administered into the luminal space of one of these malformations. The more balloon-like macrocystic, the better the opportunity is to penetrate all of the endothelial cells of the cyst. It's a third micro, a third mixed, but those tend to predominate towards macrocystic and then a third macrocystic. About two-thirds of the market, give or take, is addressable with our product, which is a cure product, right. It's not a chronic product, which is what I believe the other sort of microcystic kind of PI3K specialty products would be chronic. There is a different kind of model, if you will, there. I think where the opportunity to expand for us exists is because this product, OK-432 in Japan and now 002 outside of Japan, has demonstrated so much success in driving complete and substantial response rates in non-malignant cystic malformations of the head and neck, there is expansive literature in multiple other non-malignant cystic malformations of the head and neck: thyroglossal duct cyst, ranula, mucoceles, auricular hematomas. If you start to add up those patient populations where literature exists of OK-432's efficacy on par with its efficacy in lymphatic malformations, you start to look at an aggregate patient population, about 12.5 million patients in the United States. As we talk about what is our long-term strategy in LMs, get the approval, get the PRV, and then immediately look for ways to expand the evidence or the use case in other maxillofacial cysts. That starts to become pretty substantial. Yeah. That's terrific. Obviously, the safety profile bodes well there too, right. There is some use of mTOR inhibitors, but clearly those are not the most well-tolerated. Yeah. A lot A lot off-target effect, which should make sense, right. It's pretty ubiquitous. Yeah, we're excited for that. Of course, there's the IV choline chloride program. I'm not sure how much time we have to go over it, but. No, we've got a good seven, eight minutes. Great. IV choline chloride for parenteral support patients is really, I think, a diamond in the rough, if you will. It's getting more attention. Patients that are on parenteral support, meaning all of their nutrition is derived from, is taken in via central line, it's about 40,000 patients in the United States that are chronic PN or PS patients. They don't have in their approved macronutrients or micronutrients, nor do they have the absorptive capacity in their small bowel to absorb choline. You and I absorb choline in the form of lecithin through foods that we eat. It's a one-two enzymatic process to phosphatidylcholine, which is the most ubiquitous phospholipid in the body. These patients have salvage pathways and other sort of ways that they kind of manufacture phosphatidylcholine. They can substitute singamidin. Over time, they are known to develop multiple different medical manifestations of a shortage of phosphatidylcholine because the body does not manufacture choline on its own. There is phase II data demonstrating that introduction of exogenous choline via intravenous injection reduces, in a fairly rapid manner, evidence of both fatty liver and cholestatic liver involvement. We have been in dialogue with FDA on what a best path forward is to benefit as many parenteral support patients as possible. We supported that engagement with an observational study that we recently completed where we looked at 88 patients that are on sort of chronic parenteral support and found that 80% of those patients were choline deficient. Of those, 68% had some form of hepatic impairment ranging from very serious bilirubin elevations to hepatobiliary injury. We see a heterogeneity in the way that this liver kind of malfunction manifests. We went to the agency and said, "We want an endpoint that helps us address all of this." The agency said, "You know what? Just show us that you're elevating choline in serum at Tmax at the eight-week time point. Measure whatever kind of clinical endpoints you want. Those can be secondaries." We recently submitted the protocol, made it through the 30-day comment period, and are currently standing up sites for a seamless phase II- B, three design, where the primary approvable endpoint is just elevation in serum choline concentrations. Our view, that's a pretty low bar of evidence. When you put something in the body intravenously and then measure serum, you'll tend to see an elevation of that thing. We're pretty confident that we're going to hit a number of different clinical endpoints that we're looking at across bone wasting, muscle wasting, as well as liver endpoints. Phosphatidylcholine deficiency is associated with a lot of these. The good news is that because we're doing a 24-patient dose confirmation lead-in, we'll be measuring the primary endpoint in those patients as well. We'll get an early look before we even start the RCT about how replacing choline in these patients is faring in terms of achievement of the primary approval endpoint. Okay. Good stuff. Yeah. And being that IV choline chloride is a little bit of a different type of asset than 002, just your thoughts on strategically how you may kind of move forward with that, but maybe also just touch on what the IP exclusivity is for it, given that strategics sometimes are very sensitive to how long a product can stay exclusive, right. So maybe it's better value to keep this. And so anyway, just any thoughts you can share. Yeah. Look, I think at the end of the day, our objective is to help sick patients and to create value for shareholders. If there's a path to creating value for shareholders anywhere in our portfolio, we will absolutely prosecute that. It has got to be fair value. Yes, you can envision multiple different global players in the PN setting that could potentially be interested in this asset. I'm not sure that they will fairly value the low regulatory and technical risk. Look, we've got intellectual property, a product claim that's Orange Book-listable out to 2041. We're prosecuting that globally. There's a methods patent out to 2038. We've got orphan drug designations. There's a lot of exclusivity here. You know what? Frankly, it's kind of difficult to make. All of that, I think, bodes well for exclusivity in the choline front. If there's a way that we can create value on our shareholders' behalf, that is a very, very key focus of ours. Terrific. Just to run through the milestones. I think Thrive Three, that's the name of the IV choline chloride study. We're going to see some data from that, I think, later this year. We should also see some of the LMs data from Step One coming through. In NMIBC, you have a couple of different studies. I think you said that you'll have the 12-month CR data from Advance Two, I believe, like the middle of the year. That's right. Maybe a little bit later on, we could also see some, I think it was data in like 25 patients that were in the BCG-unresponsive set later, the six-month data. Exactly right. Exactly right. A lot to look forward to this year. Thanks very much, Jesse, for the discussion. Thanks to all of you who zoomed into this chat with Protara and wish everybody a good rest of the conference. Thanks so much. Thank you.