All right, good afternoon, everyone. Thank you to everyone in the room and dialed in on the webinar as well. My name is Faisal Khurshid. I'm one of the senior biotech analysts at Leerink Partners. We are here in Miami today at the Leerink Partners Global Healthcare Conference. Pleased to have with us today, Rob Lisicki, the CEO of Zura Bio. Rob, can you provide a quick introduction to the company and what's in store for 2025? Yeah, first, thanks, Faisal. Thanks to Leerink Partners as well for the invitation, the opportunity. Zura Bio is a clinical-stage biotech company. We have three bispecific monoclonal antibodies. All three were in-licensed, two from Eli Lilly and one from Pfizer. The lead asset targets IL-17 and BAFF. It's initiated in a scleroderma trial, and we're anticipating initiating a hidradenitis trial in the first half of this year. It's an experienced management team with success in drug development, financing, and M&A. We're in a great cash position, which is good to be, kind of given where biotech and the sector are right now. We have cash through 2027. Cash funds both of our phase II studies and gives us probably six quarters of run post-data. Really excited to actually have a drug in the clinic and to be initiating our trials. Great, great, awesome. We'll dig into kind of both of these. You're sort of in execution mode, starting your first phase II studies for the lead asset. Let's first talk about systemic sclerosis or scleroderma. This is an area that's kind of historically been a tough area for drug development. Can you maybe first start with the rationale for the program and the indication? Yeah, and I think it's timely. This is Autoimmune Awareness Month, so it's great to be having this conversation now. Scleroderma is a devastating rheumatic disease. It has a mortality rate of 50% within 10 years. When you look at indication selection, obviously, you want to have validation scientifically. You want to have some early data, some translational data. You also want to have a sense that if you have a bispecific, there's the potential to be additive to therapy, right, to produce a greater result. We've seen all of those things with tibulizumab. We see a synergistic effect potentially between IL-17 and BAFF in kind of a classic CIA model. IL-17 and BAFF are both associated with the progression as well as the severity of SSc. I think maybe the most important piece is if you're in a position where you have clinical validation of an asset. With a bispecific, that's a bit more challenging because you're dealing with two arms. In our case, for SSc, we have validation on both the 17 and on the B cell side. Given the heterogeneity and the challenge, as you mentioned, having both of those opportunities gives us a chance to really be transformative. Got it. Great. You know, the way investors approach things, right, is like always trying to, like, biotech is risky. Investors are trying to find ways to get comfortable around risk, minimize the risk. For IL-17 and systemic sclerosis, there's interesting phase III data out of Japan for a drug called brodalumab. I want to kind of start on that. Is it positive phase III? Some investors see that and say, "All right, great, that validates it." I think that's kind of your view. Some investors see other factors around that and question, like, "Is this patient population representative? Why was this drug kind of not approved in Japan? Why was the data not in a medical journal?" Can you maybe talk about that a little bit and kind of explain what underscores your confidence in the IL-17 hypothesis? Yeah, I think the first question you always want to understand is 17 validated as an approach to SSc. IL-17 amplifies inflammation. It causes fibrosis and vasculopathy as well. It clearly plays a role. Targeting it as a mechanism makes good scientific sense. On the journal piece, I think, you know, I'll just speak generically because I don't speak obviously for KK, and I don't have any facts that aren't public. There are a lot of reasons why a drug developer or sponsor may not publish data as soon as maybe investors or we may like. It could be because they're engaged in ongoing dialogue with a regulatory authority, right? You don't want to put something into public. You may want to wait until you have open label data. Companies sometimes have a position that they wait until the drug's actually approved. In KK case, they actually did do that with PPP, their approval for PPP. There is some precedent there. On the trial, I think we've always articulated that this is a very unique trial. This is a skin-only trial. In the trial, the secondary endpoints were around lung and HAQ and patient global, physician global, all of those elements. This looked at very, very early disease of systemic sclerosis. These patients had, on average, nine months of disease. You probably can't replicate that anywhere outside of Japan. It is reasonable to understand why the response may have been more robust. I think the second piece that matters is there is no MMF in Japan. You don't have background therapy or placebo therapy that can inflate or improve the placebo response. I think the third piece to look at is, have there been any public comments from Kyowa Kirin or others that would suggest there's a quality or an integrity issue? The public comments are actually in opposition to that. PMDA has this file of 80 or 100 patients where you've got good skin data, and that's the indication they were seeking. That was their public release. They weren't looking for a broad indication. I think that maybe some of the confusion is how people think about scleroderma trials versus what this was. The other two elements I would add is, I think IL-23 is supportive of IL-17. They share an axis. We recently saw IL-23 data in systemic sclerosis in Japan. The delta was 13. We've also seen in Japan rituximab data where the delta is 8 in a population that had a duration of disease of almost six years. This data is better, but it's not terribly inconsistent with prior data sets. Got it. Makes sense. Yeah, I know. Sorry, I hit you with the spiciest question first. No, no, it's appreciated. I get asked occasionally. Yeah, yeah. I think too, by the way, Kyowa Kirin was swinging for the fences on this one. Clearly, they were. This is, you know, for Kyowa Kirin last year, this was a $20 million product. It's just not a substantial product. If you're going to, right, want to really make change, then be aggressive. Part of what they were trying to answer is, can we change the natural course of disease by intervening early? I think it's an interesting scientific question. No, we think the data is valid. Great, cool. We had a panel here yesterday. We had a rheumatology panel, had a leader in kind of myositis and sclerosis. One thing that she really underscored was that this disease can be so challenging for drug development because the natural history for the patients can be variable, especially on the skin side of the disease. Can you talk a little bit about the elements that you put into your phase II study to try to sort of kind of control for this variability in natural history of the disease? Yeah, so when we designed the trial, we looked at the last 10 years of trial development in scleroderma. There were eight trials that we looked at really closely. What we wanted to do is identify trends that either suggested success or failure. In some cases, those were easy. It was an unvalidated mechanism. Hadn't been demonstrated to work. We don't have that challenge. The second was really around the ability of the site to adequately measure skin changes and to have a single reader throughout the trial that you can mitigate. A third was autoantibody detection. Patients who are RNA polymerase III-negative post two years have a lesser response in skin. If you can bifurcate your trial for less than two years and more than two years for skin, that will advantage your outcome. The final piece that we saw was some inconsistency with the duration of exposure to background therapy. If you have a patient who's coming in on MMF, which is the most common background therapy to use, 60% of patients in this trial will likely have been on it or be on it. You don't want that patient to come in who's been on the drug for four weeks because they're going to be ascending in their response. It can inflate the placebo response and decrease your delta versus the active. The final piece for us is really around trial oversight, making sure we have boots on the ground that can support investigators to make sure that skin assessments are accurate. Got it. That's helpful. We spoke about IL-17 and SSc and kind of some debates, but there's positive phase III out there. There's other supportive data. BAFF, the other side of your molecule in SSc, I think there's a little bit, it's a little bit more novel, I think, especially for some investors who are newer to the story. Can you kind of talk about the level of validation that exists for the BAFF side of your molecule in scleroderma? Yeah, again, BAFF is associated with pathogenesis and severity of disease. 90% of patients with scleroderma are positive for autoantibodies. In terms of clinical data, it's quite compelling on the B cell side. There's strong evidence, CD20, rituximab. Rituximab has had three positive blinded studies or approved in Japan for the whole of disease. GSK sponsored an independent investigator trial, 20 patients, 52 weeks at a single site, positive on both skin and lung. They've advanced to a 2b3. Another example is Novartis's ianalumab, which is a BAFF-R depleter. They've entered the clinic with a B cell depleting therapy. You can even look at IL-6. It's far less direct, clearly, but BAFF accelerates IL-6 development. There's an approved IL-6 in lung as well. We think the B cell hypothesis has been proven. It's demonstrated. I think the question is, what's going to be the additive effect of the 17 in addition to a BAFF ligand that doesn't just address BAFF, but addresses BAFF, TACI, and BCMA, right? We form a trimer against all three, which gives you broad application against a big range of B cell subsets. Yeah, makes sense. You mentioned the GSK Benlysta study that they're doing. They're doing that in the lung manifestation, scleroderma ILD. What do you make of them kind of isolating that kind of subset of the disease? I think it's probably driven by a couple of factors. About 60% or 65% of patients with scleroderma have lung involvement. If you're going to target an area, that might be the initial area to target because the need is high. That's what leads to morbidity. It's a less complicated endpoint. The path from a regulatory standpoint may be more clear. Getting sufficient patients with skin in a phase three trial can be a bit more challenging as well. It may have just been a business decision or an indications decision for them as to why they addressed ILD only in that skin. Interesting. Okay. You recently kind of started up the phase II trial in scleroderma. I think you're calling it TibuSURE. I'm sure it's a special moment for your kind of first study for the company. Can you talk a little bit about how the initial experience has been with activation and enrollment? Yeah, thanks for that question. Yeah, for the board, the founders, the team, everybody who's been a part of kind of the journey for the last three years, it was a really tremendous moment. Bringing the drug into the clinic and seeing it through the end of the phase II is why we're all at Zura Bio. Everything internally that we're seeing right now is consistent with our expectations. The trial initiated in December. Trial activation started in February. Initial activations will be across the US. All of our clinical trial applications ex-US are in with the exception of one country. 90% of our targeted countries and sites and 95% of where our participants will be are in place, in play. We have added to our FTE structure to put field-based medical team in place or pending in the U.S., EU, and Latin America as well. We continue to work actively with sites on completing contracting processes and screening patients. Importantly, we expect the bulk of the patients in this trial from start of Q3 to early Q1 of 2026. Expectation is the data completes, the last patient in, in Q1 of next year. Got it. Okay. What does success look like for that phase II? I guess I mean that both from like a trial stats perspective, but also in terms of what supports the next step of going to a phase III. Yeah, I think on-time execution is number one. Being really clean with your study quality, your oversight, your execution, demonstrating that you can deliver that, you know, what you've promised on. That's the first. The second is hitting the PE. The primary endpoint in this study is change in Modified Rodnan Skin Score at week 24. That's critical. If that doesn't happen, honestly, nothing else really matters in terms of the outcomes. There's a number of exploratory outputs in lung, the HAQ, the patient global, the physician global that will be important for phase III in terms of both the powering and the sizing for that trial. We want to see clear separation in those phase II secondary endpoints because it will inform phase III development. Got it. Makes sense. Let's shift gears and talk about the kind of rationale for tibulizumab in hidradenitis suppurativa or HS. I guess, you know, investors aren't unfamiliar with the concept of an IL-17 in HS, but can you talk about, you know, what you see as a potential of IL-17 BAFF together? Yeah, I think so first we'll talk about 17. I think that one's easier and more straightforward. 17 has been validated in HS across somewhere between 8 and 12 studies. Our 17 component is ixekizumab. And when you compare ixekizumab to secukinumab or bimekizumab, it has the highest affinity for 17A and AF in the class. So, already we're working with an agent that we think has more potency than approved therapies in HS. I think that's an important starting point. On the B cell side, there's certainly gene expression data, scientific data that supports both the role of B cells, CD20, as well as BAFF in lesions and in the disease. I also think in talking with opinion leaders, you see growing belief and conviction that this is an effective approach, B cells in HS. On the data side, there's a fair amount of data from CD20, from SSc, and from BTK inhibitor. The most compelling of that data is the Novartis platform study, which is the BTK inhibitor that was stated that read out in March of 2024 showed a result that's in line with IL-17. We're going to get clarity, I think, on the BAFF component probably in Q2. Novartis is ianalumab, which is a BAFF receptor and a depleter that Novartis has communicated they're going to read out in that trial in the first half of 2025. We know we have 17 on board. We have a super potent 17 on board. We don't hit F, which has a lot of undesirable adverse effects in our view. We have the benefit of B cell depletion. We think we have a better mousetrap here. Yeah, makes sense. I guess the way that a lot of investors kind of think about this is that, you know, you do have the kind of most potent IL-17A, but I think generally the thought is that A, you know, does not give you as much potency as like the AFs, like Bimekizumab, for example. How should you think about, or how should people think about, you might be losing something going from an AF to an A only, even though it is the strongest A, then you are kind of adding something on the BAFF side of the molecule. How should investors think about kind of where you net out relative to like AF standard? Yeah, you know, it's funny. I get that question all the time. I don't know that the difference that bimekizumab demonstrated in psoriasis is due to its affinity to F. I know that's what's shared. I know that's the voiceover, but I don't know that that's the case. If you look at bimekizumab affinity for 17A relative to secukinumab, its logarithmic fold's different. It's like 2 versus 90. Is that effect coming from a higher affinity for 17A or from the addition of F? That answer to me is not clear. When I look at HS, let's just look at HS. Secukinumab has two studies. Bimekizumab has two studies. Secukinumab is a delta of 6 and 17. Bimekizumab is 15 and 20. All right, three of those are exactly the same. Right? Right? Is the 6 the outlier? Was that randomness? Was it the patient population? Was it some other contributor? I'm not convinced that F is generating a better response. I'm not. I think the offset effect of candidiasis is undesirable in the commercial market. The rate is high. It is going to require interruption of therapy. There is an implication there that could be problematic in the inline markets. That is, again, not knowing whether or not you're getting additional benefit there or not. Got it. That makes sense. You know, could you clarify, like, as you think about the potential for the molecule in HS, HS is kind of growing more and more crowded, kind of year- over- year. What is your, as you think kind of long term, what is your kind of target profile? Are you aiming to be better than the IL-17 class? Yeah, I think you have to assume that, right? I think if your proposition is, is that a bispecific provides either a broader or a deeper approach, your clinical data has to demonstrate that. Whether you're looking at AN changes, HiSCR 50, HiSCR 75, safety tolerability, you clearly have to find a way to separate. I don't think it's sufficient to be as good as, right? You need to show a better result. In the phase II trial, we'll have prior TNF exposure in that trial, but there's not enough IL-17 exposure to get a read on that. In a phase III trial, that's something that you might look at or a separate trial. In phase II, we clearly want to show separation relative to what's been demonstrated in the class. Yeah, makes sense. You mentioned the Novartis ianalumab data potentially coming up in the next few months for their BAFF receptor agent in HS. I guess, how are you thinking about that data set and the read-through to you guys? I'm also curious, like, if those data are positive and kind of encouraging relative to what's out there, how do you think about it? Also, like, if those data are not super encouraging, you know, relative to the IL-17 class, for example, like, how would you think about it? Yeah, so when we look at external reads, we usually develop three or four different scenarios, right? Where better than, as good as, less than, not effective. Sure. We prepare for all of those to determine how our response will be. I think if your argument is that B cells are important to reduce disease of HS, then you can't argue against another BAFF, right? Or a B cell depleter. I think we're going to see an effective drug. Answering how effective it's going to be relative to the class, we can't. If we just had another BAFF agent, that would be problematic, right? We don't. We have 17 and BAFF. The idea is these two are going to be additive for HS patients. The other piece that we'll look at closely, because again, this is a BAFF-R depleter. We're a BAFF ligand. We're structurally a little bit different, right? Our B cell depletion is different. Is there a safety or a tolerability signal with such a robust depleter of B cells? I don't think that translates to us. We have a lot of data on tibulizumab, the BAFF component, but I think it's something that we're preparing for in the event that there is a signal that's seen. Got it. That makes sense. Okay. In terms of the phase II for tibulizumab in HS, can you just remind us, like, the design of that? I think I remember it's kind of consistent with what's been done and also the progress on getting that going. Yeah, there's nothing that's terribly distinctive about the trial. It'll have two active arms, one placebo arm. Typically, with the derm division, they want you to test what you think is your lowest, minimally effective dose. This will be two doses, one low dose, one high dose. Both of those treatment arms will have a loading dose as well. They're both 16 weeks to your point. We expect to initiate shortly. Got it. Exciting. I want to talk about your IL-7 program for crebankitug. Obviously, there's been kind of some news in the landscape there. You guys have always had the strategy of sort of seeing what's in the landscape and then deciding what to do. We'd love the latest thoughts on how you're thinking about where you are in deciding what to do on IL-7. Yeah, I think that, look, historically in 2024, there were so many external reads across IL-7, TSLP, B cells in HS, waiting for the bimab data. It was a very rational approach to say we're going to be very thoughtful about cash and not initiate until we see data. That starts to change a little bit as we move forward. On the IL-7 TSLP side, when we look at the UC, AA and AD data, what we've seen to date is not compelling, right? That's kind of the first step. Secondly, we've shared in the past that we always work in background to look at other indications where we think IL-7 or TSLP or in combination may hold good therapeutic promise. We do that first with a lot of literature searches and good science. We've also done it through exploring genetic polymorphisms where IL-7 and TSLP play a role. Then we look at the existing clinical data for TSLP. We haven't guided on this, and I don't think we will until Q2. You can start to look at areas where TSLP is validated, where it has approved indications, and you can start to see in respiratory disease, there could be opportunities for a combination approach to get a better outcome. The next question is, okay, how do you validate that thinking? Can you do that through translation medicine? Do you need clinical or human experiments to do it? Can you do a four-week study? That's the process we're going through right now on 168. It's clearly an active drug, great potency for TSLP. Now it's about doing some basic work to understand where the promise and opportunity may be. On 880, the IL-33 side, we expect to get the two phase III readouts in COPD sometime in Q2. Based on that, that will guide our thinking a bit as we move forward. Moving forward in COPD would absolutely require financing. It would be a challenging trial for us to initiate based on our current size. Again, it's an area where we're looking at other indications where we may lead versus follow. Got it. Just to clarify on IL-7, you said you'll have some clarity in the second quarter of this year. Would that be on whether or not you do clinical studies, or would this be potentially kind of on like translational preclinical work? Yeah, I don't want to get ahead of my scientists, but the discussions we have is tell me what the best way is to be able to answer these questions, right? How active is the drug? Is there a reasonable likelihood of effect within these areas? How do we demonstrate that? If the team comes back and says, hey, there's a good animal model, mouse model that we can use to show that, then that's the approach we'll take. That typically takes a couple of months. If the team came back and said, hey, there's not a good translatable model, translation model for this experiment, then we would look at human trials. Those human trials, though, could be four weeks, right? Again, the development team and our translational medicine team will come back and inform that. I want them to come and give me the point of view before we decide. I want to have clarity before we guide, right? This is what the plan is, and this is when we'll have data. Got it. And then on the IL-33, you know, obviously two big upcoming readouts from big pharma competitors coming up in the next few months here. How are you thinking about the kind of read-through to the program that you have in-house? Like, if those data look good, is there a kind of idea that your program might be able to kind of do better and quickly follow? Or can you remind us, like, on the molecules themselves and how they differ? Yeah, so the Roche product is actually an ST2 receptor. It does work a little bit differently. It's essentially blocking IL-33, right, from occupying the receptor. The Sanofi product, their IL-33 is binding to the ligand, IL-33. The two differences are, one, torudokimab has greater potency. It was demonstrated in an early human experiment, small study, but it showed greater potency for blocking GM-CSF, right, which contributes to COPD. The second is torudokimab works on both the ST2 dependent and independent pathway. Whether the receptor is there or not, it doesn't matter. It still has effect. The difference is it downregulates RAGE. RAGE is a pattern recognition receptor. It's essentially an alarm and when it's activated, it triggers an immune cascade in the body. IL-6, TNF, and IL-1. Potentially you're downregulating both ST2 as well as RAGE. There could be a benefit there. I think the question for us will be, how compelling is the COPD data? Does it generate enough interest where it would be a catalyst for a raise? Because even a Phase 2b study in COPD would be large, expensive, and lengthy, and we're not in a position to initiate a study like that. Got it. You have enough kind of phase I data, just like the previously generated data for the asset, you have enough that you could move in theory straight to a Phase 2 b? Yeah, of the assets we have, that was the asset that was actually tested the most widely. It was tested in an AD study. There's, I think, two approved INDs already for 880. There's three INDs for 106, about to be a fourth. There's INDs approved for 168. I think maybe those are sometimes some of the misses, that these are validated mechanisms with full tox packages that are ready to enter phase II studies. Yeah, yeah, interesting. I mean, downregulating RAGE sounds cool in general. When you hear pattern recognition receptor, you just kind of get excited because it does sound neat. Yeah, I think it's kind of a nuance too, but it's one of the areas where when you start to try to understand how these assets may be different, it's an area where there may be differentiation that could, you know, potentially lead to a better result. Got it. I kind of want to, you know, zoom out a little bit in our last few minutes here. I think the way that a lot of investors have kind of thought about the tibulizumab setup is that scleroderma is kind of a, like, high-risk, high-reward opportunity. Hidradenitis is a little bit more of a, you know, lower risk, but kind of more uncertain reward given the competitive landscape. Is that a fair way to kind of see the setup across the two indications? I think that, you know, always people, you know, you kind of stand on an issue based on where you sit. I think if you came into the company as a believer in scleroderma, then your bias is that, no, this makes a lot of sense and the return here is significant. On the HS side, okay, I really know IL-17 works, I believe in the B cell hypothesis, big market, lots of drugs are going to do well. You know, and our investors, I would say 60-70% are both. There are always, right, people who are on both the margins. They believe a bit more in scleroderma, right? They take your thesis, which is high risk, high return, competitive market. You know, I think our approach is we want to understand where we think our drugs can make a difference, where they can help people. We want to make sure we can execute those trials and that we can bring something to the market that it doesn't have, right? Let's generate the data, let's prove the hypothesis, let's create value. My view is that in both cases, this is a transformative asset. There's nothing broadly approved for systemic sclerosis, nothing. This asset has the chance to do that. There is no bispecific that's validated on both sides for HS. In two months, we're going to answer that question. Right now, because of the dislocation in the stock, there's tremendous value. The question we've always gotten is catalysts. You know, we're 12- 18 months away from two phase II catalysts and two significant market opportunities. This is what everyone's been asking me for, and we're delivering it. The final comment I'd make is that in 2024, we guided, I think, on a lot of promises to the market, and we delivered on all those promises. We're a team that takes that commitment seriously to our investors and to our stakeholders. It's what we spend our day focusing on. Yeah. Congrats. I think you're almost at your one-year anniversary, is it? Yeah, I started in January and moved into the CEO role in April. Yeah. Yeah, great. Just one to kind of like wrap us up here. What do you think investors misunderstand most about the Zura story? I think it's around, it's really around the question that you asked around 106, right? Which is, is it validated on the B cell side in scleroderma, but 17, I'm not so sure of. And on the HS side, I believe in 17, but not B cell. It's kind of an interesting juxtaposition. I think maybe the miss is how some of the external data has been interpreted. That's one. I think the second piece is that when I think of, when I make an investment decision for myself, when I look at a company, I look at the track record of the company. Is this a group of people who can execute? Did they get things done? Do they manage their money and their resources responsibly? Do they have a track record of M&A? In our case, we have a strong track record against all three. In some cases, some of our peers said, I don't see that as strongly. I think it's an area where we distinguish ourselves as a company. Got it. I think that's a perfect way to wrap it up. Thank you so much for joining us, Rob. Thank you to everyone in the room who dialed in online as well. Yeah, it's great. Thank you so much again. We appreciate it.