All right, I think we're live. Good afternoon, everyone. Welcome to Guggenheim Emerging Outlook Biotech Summit 2026. My name is Yatin Suneja, one of the biotech analysts here at Guggenheim. Now our next presenting company is Zenas BioPharma, and it is my pleasure to host this fireside chat session with the Chief Executive Officer of the company, Lonnie Moulder. Lonnie, I think you have some slides that you wanna run through. Why don't you take 10 minutes, walk us through the story, highlight some of the stuff that you want to, and then we'll go into some of the Q&A that I've prepared for you. That sounds great. First of all, thank you for having us here. It's a great conference. I'll be making some forward-looking statements along the way, so I would refer you to our SEC filings. At Zenas, you may know us, and know that we have a really deep pipeline, and we have a lot going on. I wanna highlight a few key aspects of it. We'll initially focus on obexelimab and the IgG4-related disease opportunity. We'll talk a little bit about the lupus program and then touch on some of the other molecules in the pipeline. But if we start out with IgG4-RD, as you know, we reported the positive top-line results of the INDIGO phase 3 study of IgG4-RD with obexelimab. As a reminder, this is a study design similar to the study design run by Amgen for their product, and a study design that the regulatory authorities across the world agreed to. It involved screening patients that are in flare with IgG4-RD, putting them into remission with a steroid regimen, and then randomizing, taking them off the steroids, and then tracking for flares as the primary endpoint. Importantly, there's an open-label extension portion to the study, and today we're reporting the first results from the open-label extension. I'll get to that in a moment. But the primary results, as many of you know, there was a 56% risk reduction in that primary endpoint of time to disease flare with a hazard ratio of about 0.4. Importantly, about three-quarters of the patients were free from flares. And in any rheumatic disease, that's a really compelling outcome. In addition, all key secondary endpoints were met with high statistical significance. This is what I referred to. Of the 141 patients that entered the open-label extension, about half are now evaluable at six months. For those 73% patients, at six months, 92% remain flare-free. I think that really establishes the durability of this mechanism of action and the importance for patients with IgG4-RD. In the primary analysis, of course, safety was measured in a variety of ways. What you see here are the results of, I think, some really important comparisons to the placebo arm: overall serious adverse events, no greater than control or placebo; and importantly, infections, whether it be upper respiratory tract infections, urinary tract infections, COVID-19, positioned really well, or serious adverse events. I think in this patient population, which tends to be older and at risk, this is a really important consideration. In the KOLs who we've spoken to and our investigators, they were really pleased to see this outcome, that they have an agent, potentially, that they can administer to this generally frail patient population and be confident about the safety profile while at the same time delivering great efficacy and real convenience with at-home subcutaneous administration. The tolerance of that subcutaneous administration is listed here, where the obexelimab injection site reactions were not much different than placebo. So I think we have a really strong profile. So what we decided to do, after hearing all the positive feedback from the KOLs and investigators, is deploy an important market research study to validate what we're hearing and what we're understanding about how this profile could fit into managing patients throughout their journey with IgG4-RD. So the survey involved 80 participants. About 60% were rheumatologists. Note that 20% were gastroenterologists. Ultimately, there are gastroenterologists that manage liver, biliary, pancreatic disease that are important to IgG4-RD. They're probably the second-largest prescribers, so we included those. And it's about 70% community, 30% academic, a good mix. Average number of patients per year they treat it was 18. And we put in front of them product X, obexelimab, with the INDIGO Phase 3 results. And you can see how we listed them here. So you see the risk reduction hazard ratio, a commentary on adverse events. That was the profile we gave them. We asked them about the value of an inhibitory approach versus depletion. They lined up, and about 50% agreed or strongly agreed that inhibitory adds a lot of value to how they would think about treating patients with IgG4-RD. The other almost 50% were indifferent. I think that sets up well our inhibitory approach. Then, of course, they were asked the likelihood of prescribing product X, 64%. Then they were given the opportunity to allocate share 3 years from now. Which share would they give each agent? They would give product X, obexelimab, a 47% share, and the remaining would be split between Uplizna and rituximab. We dug into that a bit more. What about line of therapy? So just over 50% said product X would be their first choice, and then at times it could be second behind either of the other two agents, as you see here. Typically, in rheumatology, and you probably know this, if a patient's on a therapy and they flare, what do they do? Do they switch to another flare therapy? No, they generally just give a small steroid regimen and continue that unless, you know, they have many, many times of failure. So they were asked, "If on product X the patient had a flare, what would you do?" 50%, 49% said, "Well, we would add a steroid regimen for a period of time and then continue product X." You can see the percent that would then switch to one of the other agents. And that's generally how rheumatology works. We also asked about their patient population because, in our minds, older patients or patients that have concurrent illnesses seems to be an ideal place to start with an inhibitory approach that obexelimab has. So they described to us what percentage of their patients fit into these categories: older patients, younger patients, healthy, concurrent illnesses, multi-organ. And then we asked them to allocate the share again by segment. And the range, the lowest for any one segment, was 50%. The highest was 55%. I think it all points to about a 50% share regardless of the patient characteristics. They then had an opportunity to type in what we call verbatims in market research: "Why do you say this?" And what stood out was, "It's an inhibitory approach that's effective but really safe, and we would use it first line." And occasionally what would come up is that it's convenient because it's at-home subcutaneous administration, which we also tested. We put in front of them the profile of a weekly sub-Q, which is product X, obexelimab, versus an every-six-month IV. And about 40% strongly agreed that they would prefer sub-Q weekly, and about 50% were indifferent. Either one is fine for them. Only 5% preferred Q six-month IV. In a separate study with patients, you know, ultimately I think what patients think might be more important here, we asked 20 patients that are IgG4-RD patients what their preference would be, and 75% preferred the sub-Q. So overall, this is sort of the platform we're thinking about when it comes to commercialization, that this drug provides protection for about three-fourths of the patients. A lot of them are older and/or more susceptible to severe adverse events or have concurrent illnesses: cardiovascular disease, respiratory disease, concurrent infections. Younger patients that are gonna be on therapy for decades and decades, why not use an inhibitory approach first? You could always move on to a depleting antibody if you needed to at some point in time. And along the same lines, the benefit of an inhibitory approach such as obexelimab, you can pause it if you need to manage comorbidities or you want to do vaccinations, something else we're investigating in our open-label extension study, and the convenience of at-home self-administration. So all of that together, I think, sets us up really well to have an important launch here in a disease that people are recognizing based on the first products ramp up in sales could be a, a real significant revenue generator for a, a young biotech company. Thank you, Lonnie. This was great. I have just one question on this, and then I'm gonna touch on the commercial. So we have gotten similar feedback. We just did a call with one physician. I think got similar feedback. So the question that I have for you is, why is this inhibitory approach resonating? Like, what is underlying this enthusiasm around this inhibition approach? Is it just the safety? If it is safety, what exactly on the safety side? Convenience, like, what is the type of patients? Yeah, it's safety. Mm-hmm. You know, it was one investigator, KOL, explained to me, you know, when he treats a patient, you know, the patient usually doesn't ask, "Is this agent effective?" The patient asks, "What side effects can I expect? You know, if I'm on this long term, what problems do I need to be aware of? Yeah. I mean, that's what's top of mind for patients. And for physicians in this disease, with these patients being older and having a lot of concurrent illnesses, they're a little fragile. And all, virtually any rheumatologist in a group practice experienced during COVID several patients who died. Yeah. On rituximab due to COVID 'cause they didn't have a vaccine response. Or from time to time, not that the infection rate is high, but these really intense infections that cause hospitalization that rarely occur, but they're there, and they stick with them. Got it. And they remember that, and they don't wanna be stuck with that. And when you give a depleting antibody, you've done it. It's six months. You can't pull back. You've made that decision. And they don't think they need to go there first if they have an effective agent that has this type of safety profile. Yeah. So clearly effective about what you said, 75 or three-quarters of the patients don't get any flare. How does it stack up versus Uplizna? Does that comparison come into your discussion with the KOLs, or is, yeah? Yeah. So if you looked at that, you would say 90% for Uplizna in the study they ran. Yeah. You know, if you ran each of these studies 10 times, I don't know if the results would be that different, but they are what they are. But for clinicians, the first thing they said when we presented this to KOLs and we asked about that, the first comment was, "Why are you comparing studies? Mm-hmm. Like, "Why are you doing that? You have a really effective drug here that's safe. Why would you compare the numbers? They're different studies. Mm-hmm. You know, there's aspects of the studies that are somewhat different, not majorly different. There's different outcomes. Okay. But this is a highly effective drug. Okay. Don't do that. And I know, you know, there was a lot of focus on the hazard ratio. Of course there was. There it's a benchmark that people can look at. But of all the things to consider in making a decision on how you treat a patient, the hazard ratio in a study isn't, like, top of mind. Especially in this type of disease. For a clinician. Yeah. I get it. Okay. Now moving on to the commercial side, could you maybe help us understand how many patients are there, how many are on B-cell inhibitor? Like, what sort of is a launch, trajectory we should think about and pricing as well? Yeah. So the number of patients that we're confident stating are diagnosed and managed in the U.S. right now is about 20,000, similar in Europe. Yeah. We know that the other product, they had their quarterly earnings. Yeah, Uplizna. And they stated that there are 35,000 patients diagnosed in the U.S. I don't have access to that data. We believe there are 30-40,000 patients, but we think there are 20,000 diagnosed now. And of course, between Amgen and us, the education that will be done. I think more and more diagnosis will take place, and the patient population will expand for treatment. So if you look at that patient population and think about the number of patients that are treated in this survey, they said 80% of the patients are treated. You know, I don't know if it's 50%-80%, somewhere in between. But if you take that number and you apply the current pricing in the market, that's a $3-$4 billion market opportunity in the U.S. We think with this type of share opportunity that this survey provides that, you know, we would expect this to be a significantly greater than $1 billion drug in the US for us. As far as sales ramp, I think it's too early to be. Sure. Projecting that. How would you view the Uplizna launch so far, Amgen's launch? I would reiterate what they said. It's a really strong launch. You know, it's hard to discern exactly how much of the product, because it has other indications, is used in IgG4-RD. But we can look at their year-over-year and their quarterly increases in sales, and they're quite dramatic. And then we separately buy some patient data that would suggest that it's a substantially successful launch. Got it. What percentage of the patients are Medicare or Medicaid or the commercial, basically? Yeah. Medicare, you know, it's probably 40%-45%. 45%. Got it. Any special pricing consideration given the convenience and the safety relative to Uplizna, or should we assume similar? Yeah. Something to think about here. So if, you know, within a year of our first launch, our launch will be with prefilled syringes, and then we follow up with an autoinjector, a typical pen, under-10-second autoinjector, within a year. The way that that works, it's shipped through specialty pharmacies in a case pack. So a patient will get a month of their autoinjectors every month. Yeah. So pick a number. If the WAC, the wholesale acquisition cost of the competitive product is $280,000 annually for illustrative purposes, let's say we're the same, right? Mm-hmm. The payer pays $23,000 a month. Yeah. Whereas with the other drug, there's 2 doses over 2 weeks. Yeah. Right? That would be $280,000 in two weeks. Right. So there's a different proposition for the payers. And then six months later, for that other drug, there's another dose for another $140,000. So it's $420,000 in six months. And ours, if we were the same maintenance price, would be $23,000 a month. I think there's an opportunity there. And of course, under Medicare Part D, the copays are generally lower for patients also. Got it. Two more questions. I have a lot more other stuff, so I wanna go there. When would you be able to file, and how should we think about the commercial buildup? Yeah. So the filing will be in the second quarter for the BLA in the U.S. and in the second half of the year in Europe. And then, as I said, the autoinjector would be an sBLA as soon as the original BLA is approved. The ramp-up for commercialization, we already have our medical affairs team in place in the U.S. and Europe. They've been working with the KOLs and the key players in this field. We have significant presence at all the rheumatology meetings and some gastroenterology meetings. And from a sales force standpoint, right now, based on maybe 5,000 rheumatologists in the U.S., 1,500 targeted gastroenterologists, if you size sales territories, that would put you probably just under 50 sales reps that you then supplement with strategic engagement people and market access people. So the whole organization's probably 70 people or so in the U.S. In Europe, where we'll launch, as you know, in Europe, when you say you're launching in Europe, you're really launching in Germany. Germany. For a while. Then Italy and France come. So it may get to that same size, but it'll take three years to get there. Got it. Very good. I think that's what I have on the IgG4. You addressed a lot of it already. So on the lupus study, the Sunstone study that is reading out, help us understand your confidence in that. I think there has been some earlier experiment, like, yeah, right here, where you have, you know, some exposure-related responses. What we should be expecting, when is the data coming? What type what are you doing to manage the placebo because generally it's high in SLE? Yeah. So the study will report out in the fourth quarter, and that will include the overall top-line analysis on the 24-week BICLA primary endpoint. But we also have a biomarker program in here, and we'll have those data sets analyzed. That takes a little bit longer to do that, but we'll have those analyzed at the same time, so that we'll be able to describe the outcome in the biomarker-positive population and, of course, the overall population. And just to remind you, back to the phase 2A study that was conducted by the innovator of this product, who we in-licensed from, the intent-to-treat population for the primary endpoint in the phase 2A, you can see the effect size in the high teens. You know that's the same effect size range of the two approved lupus drugs in the U.S. Yeah. In patients that got the right exposure 'cause this was the old IV formulation, that doubled. The kind of exposure we provide with our new subcu regimen is that middle bar. The far right is what the retrospective analysis of the biomarker showed. It's really compelling, but it's small and, and retrospective. So in this study, all patients are being evaluated for it. And once we get those biomarker results, we'll determine for Phase 3, what do we do? Do we do an all-comer population? Do we do biomarker-only, or do we do what's done frequently in oncology, where you test the biomarker population first, take an alpha hit, and then test the overall population to get the broadest possible label? We'll decide to do that after we see the results of the Phase 3 study, Phase 2 study. And importantly, in this phase 2 study, as you know, Lupus studies are challenged from time to time with outperformance of the placebo arm. So we're being really strict on the screening criteria, where the investigators screen the patients, but they then are submitted to a committee that rescreens them. And we find that we're rejecting a large number of patients, that are probably on the edge, but they don't quite meet the criteria. We understand why investigators wanna put them into a clinical study, but we kick those out. So we have a pretty high screen failure rate to get the pure population so that we can really give this drug a fair test. And we think that sets it up for potential success. Got it. And what is the endpoint? I think you have, you're going with BICLA as an endpoint. Yeah. Why not SRI-4? That's number one. What is this biomarker? Yeah. So if it was SRI-4, I guess the question would be, why not BICLA? And that's. Yeah. The debate. So, you know, looking at our mechanism, looking at what each of those pick up more than the other, nuances, and a consensus of all the clinical advisors, we landed on BICLA. Okay. You could go either way. And then. We landed on BICLA. And then the, The biomarker is really a gene pattern, a clustering of genes. This is published. It was in the, let's see, Annals of Rheumatic Disease. Mm-hmm. December 24. Yeah. And it shows the clustering. And we took this. This was done by Oklahoma Medical Research Foundation, but we took the data sets from the sequencing, and we put them in the hands of two different commercial entities that actually could commercialize a biomarker, and had them run the data. And when we look at all that, it all lines up, where about 30% of the population with lupus, SLE, have this gene profile, and that's where it was highly responsive. Got it. And on the BICLA endpoint, on this 24-week endpoint, what is a good placebo-adjusted delta? I think with the two approved drugs being high teens, I think if we're in that range a little bit better, that would be fantastic. And then let's look for the biomarker to be a step. Okay. Log above that. Above that. Okay. Very good. Then move to the BTKI. I think you were at ECTRIMS, right? So maybe. Yeah. It's a fantastic meeting. Yeah. Just, if you wanna summarize some of the key takeaways because there were some presentations both on fenebrutinib? Yeah. I think the, the landscape has cleared up here. We now know the challenges that tolebrutinib were faced with, not only with the, doing an NR SPMS study as opposed to the NA, or non-active SPMS population the FDA wants. And that's what we're doing in our N-SPMS study. And the significant PK variability that, in their in their response, exposure analysis showed some issues back in the fall at the ECTRIMS meeting. And then, of course, the agency, as they said, in their complete response letter, not being able to identify a population where benefit was adequate relative to the potential risk of the drug. And then the PPMS trial just didn't clear the hurdle. When you look at the data, there's hints of activity there. They had some challenges in their inclusion/exclusion criteria. They also did the six-month composite CDP, which was a little more challenging. Whereas for fenebrutinib from Roche, which is identical to our approach, it had the same inclusion/exclusion criteria as we do with orelibrutinib, and also the 12-week composite CDP, which is the endpoint you wanna look at. The fenebrutinib data was received extremely well. It was probably one of the most exciting activities that discussion around this out there at ECTRIMS. And it's because it worked. Now, it was compared to Roche's Ocrevus. They compared the two drugs. Yeah. Ocrevus, as you may know, in PPMS, doesn't have the most stellar data, but it's approved. And when you look at the study, it was non-inferior, met the endpoint, but numerically everywhere, it beat Ocrevus. And when you look at the overall benefit-risk, you know, people point to the transaminase elevations. About 13%, about 7% of the patients discontinued, but no clinical sequelae, all normalized. And it has that risk-benefit that tolebrutinib did not. So we're conducting our PPMS trial. And when we look at these agents and really think about how orelibrutinib is differentiated, in progressive MS, you need to get into the brain. You need to impact microglia, macrophages, and B cells resident to the CNS. And to do that, you need excellent concentration. You need a potent molecule. And when you put that together, we think orelibrutinib has that best profile, and it's once a day. You can see where tolebrutinib and remibrutinib come out when it comes to the brain and potency there, which matters in progressive disease. I think they both would do fine in RMS, frankly. Fenebrutinib is a little better, and it succeeded in PPMS. We like to profile orelibrutinib. And of course, we're running the program to demonstrate that. So the PPMS program's ongoing. The non-active SPMS is about to begin, and you can see the way the trials are set up here. Got it. Very good. And then finally, in the interest of time, what about—actually, do you have two oral molecules, TYK2, but I wanna focus on the IL-17. Where is that? When is that entering clinic? What could we see from a data perspective for these two molecules in the next. Yeah. Couple of months? The TYK2 brain penetrant will enter phase 1 at the end of the year. Next year, we'll have the important PKPD. Okay. First, though, is the IL-17, the oral IL-17, which is ZB021. This will enter the clinic mid-year. We're just a few months away. And we'll rapidly move through the SAD and MAD study, with this molecule. It should be a once-a-day, but unlike doing long-acting antibodies, you can do SAD/MAD really fast here. Then we'll go right to a patient population. It's part of the protocol. So we'll be there by the end of the year in, in psoriasis. And next year, we'll actually have the psoriasis outcome from that program. Interesting. We'll determine what the registration program will look like. So this is a really fast-moving program. This molecule has outstanding ADME characteristics in primates, 80% bioavailability. The non-clinical data looks quite strong relative to antibodies. So we're really excited about this. And it's great that it's gonna move along that fast. Very good. Indeed, a lot going on. There is a lot going on. Very, very extensive pipeline. Yeah. Very good, Lonnie. Thank you so much. All right. Thank you, Yatin. Thank you, everyone. Thank you. Thank you so much.