Forte Biosciences Inc Aktie

Good morning, and welcome to the Forte Biosciences Investor Webcast. [Operator Instructions] As a reminder, this call is being recorded, and a replay will be made available on the Forte Biosciences website following the conclusion of the event.

I'd now like to turn the call over to Dr. Paul Wagner, Chief Executive Officer of Forte Biosciences. Please go ahead, Paul.

Great. Thank you very much, and welcome, everybody, to the FB-102 Celiac Disease Phase Ib results conference call. It's a very exciting day for us and I think for patients as well. On the call with us here today also is Professor Jason Tye-Din. Professor Tye-Din is the Head of Celiac Research at The Walter and Eliza Hall Institute at the Royal Melbourne Hospital. And in addition to being a key thought leader in Celiac disease, Professor Tye-Din is also a principal investigator -- principal investigator in this study. I think enrolled close to 20% of the subject, so has direct experience with the study as well. And so thank you again for joining us Professor, Tye-Din.

So this is just the forward-looking statements. And as a refresher into a level set for people that may not be as familiar with FB-102. FB-102 is an antibody to CD122, which is a subunit of the intermediate affinity receptor for IL-2 and IL-15 and it's expressed on NK cells and certain subsets of T cells. The idea behind FB102 and we'll talk more about the mechanism here in just a minute is that we wanted to intermediate both the IL-2 and the IL-15 induced proliferation and activation of reactive NK cells and T cells, particularly autoreactive T cells and NK cells. The Celiac disease Phase Ib trial is completed. We're going to be talking about that today, and we're really pleased to announce that we've demonstrated positive histological and symptom data in the treated subjects compared to placebo.

We're moving ahead very aggressively given the positive results, the Phase II Celiac disease study is initiating and the data is expected in 2026. And we also have a vitiligo study ongoing right now and the top line results there are going to come in the first half of '26.

But on to FB-102. One of the things that we think is really exciting about this is the connection between the mechanism of FB-102 and the biology of diseases with very high unmet need. And on this table, I've highlighted some of those. But there's maybe 10 or 15 different diseases that have shown activity and indications that have shown activity by blockade of CD122. And we went through into the thorough analysis of the biology of those different diseases and compared that up with the mechanism and these really came up towards the top, of course, celiac disease, vitiligo alopecia and type 1 diabetes. And while these all look to be very disparate diseases, the reality is they're closely connected by the autoreactive T cells, which we believe that we're having a significant effect on the mechanism of FB-102.

And to that point, I'll just talk to the cartoon that's over on the right. As I've indicated, FB-102 blocks the interaction of the pro-inflammatory proliferation cytokines, IL-2 and IL-15 and it blocks the interaction with the intermediate affinity receptor which, as I mentioned before, is expressed on NK cells and certain subsets of T cells. And by blocking that interaction we're able to prevent the proliferation and activation of those potentially pathogenic autoreactive cells. But what we don't do or we try not to do is to inhibit the IL-2 binding to the high affinity receptor, which is in the upper right-hand corner, which is expressed on Tregs. And so the idea here is that we're able to impact the proliferation and activation of these autoreactive T and NK cells while not having any significant impact on the regulatory T cells, which are helping to modulate the immune system, particularly in autoimmune diseases.

And this is data that we generated recently, it really highlights the activity of FB-102. And in this experience, what we've done is we put FB-102 into the media together with CD4-positive and CD8-positive T cells. And when that happens without FB-102, what you see here is a very significant activation of those T cells, whether it's the CD8+ T cells the CD4+ T cells. Activation of course, meaning these are the cytotoxic, they become cytotoxic and release pro-inflammatory cytokines. And so without FB-102, what we see here is a 60% with the CD8-positive T cells a 60% activation. And when we put FB-102 into the mix, there's really completely halts the inhibition -- inhibits the T cell activation. You can see that because the cell only on the far right-hand side, that's with no cytokine whatsoever.

And what we did in this experiment is we put IL-2 into the mix for 24 hours and then IL-15 for 3 days and able to completely inhibit that T cell activation.

In terms of celiac disease, this is a very high unmet need here, and Professor, Tye-Din can elaborate on that as well. The incident here is around 2.5 million people, but probably underdiagnosed because there really is no treatment option for celiac disease. At this point, it really is just attempting to avoid gluten.

And in terms of the biology itself, when gluten is ingested, the first thing that happens is the antigen presenting cell breaks down that gluten, it presents it to a CD4-positive T cell but then releases the IL-2, which is a signaling molecule that causes the proliferation and activation of T cells that supported by IL-15. And so what we're able to do here is block both that IL-2 and that IL-15 signaling and so really well suited for celiac disease. And a significant amount of activity going on here again, Professor, Tye-Din has been involved with many of these studies. But Takeda, Chugai, Teva, Sanofi, Amgen and of course, Novartis with the acquisition of Calypso. So a lot of activity in pharma going on here, again, because of the significant unmet need in celiac disease.

I'll turn it over now to Professor, Tye-Din to talk more about the morphology and histology measurements in celiac disease. Professor, Tye-Din?

Thanks very much, Paul. So what we're seeing here is a villi structure. So when we measure gut damage in celiac disease, which is really the primary kind of readout that we want to assess celiac disease with the immune response that develops to gluten causes damage to the small bowel. And it's really these villi that get inflamed. And you can see the arrows here at the tip of the villi pointing out these T cells are called intraepithelial lymphocytes. So we shortened that to IELs. So increased numbers of IELs and increased density represents inflammation of the small bowel. This is what we really want to reverse in celiac disease.

So in active celiac disease, we get a lot of these inflammatory cells in the lining of the gut. And these release mediators that lead to changes in the lining so that you get flattening of the villi and so you get what we call villas atrophy. So these cells are expressed as a density. Usually, the number of IELs per 100 small intestinal lining cells called enterocytes.

So next slide. So what we can measure here is what we call the villus height to crypt depth ratio. And you can see here on the figure villus structure standing out to the right. So it's finger-like projections that help absorb nutrients from -- ingested into the small bowel. The longer line there represents the length of the villus structure and then the smaller green line represents the crypts. The crypts are what produced the cells that make the villi. So what happens in celiac disease is the villi becomes shorter, and so the ratio between the villus height and the crypt's depth starts to fall. So a normal ratio is around 2.5 to 3. In celiac disease, this falls down.

Next slide. The best way we're learning to conceptualize a both the inflammation with the IELs and the damage that results from these IELs is a metric called the VCIEL. What this does is it combines both those things, the IEL count, and the villus height to crypt depth. So it's considered a very useful marker because it is encompassing both those 2 independent metrics of gut damage, and it has high statistical precision. And because of this higher precision, it's probably better to detect changes that do exist more sensitively. So this is likely to be a scale that's going to be adopted for many clinical trials moving forward.

Next slide. Okay. So let's jump into the actual data from the Phase Ib trial. I'll pass across to you, Paul.

Sure. And I'll start off with just the design, the baseline and then I'll turn it back over to Professor Tye-Din to talk about the data. So this is just a refresher on the design of the study. It was a 32 subject study. We enrolled at 9 sites in Australia and New Zealand. It was randomized 3:1 FB-102 to placebo. So 24 were on active FB-102 and 8 were on placebo. And the subjects received a total of 4 doses of FB-102 weekly after receiving 3 of those 4 doses, they started a 16-day gluten challenge. And we uptitrated the gluten from 2 grams to 4 grams and then 8 grams for 14 days. So this is a total of a 16-day gluten challenge.

And in part, the reason we did that up titration was based on feedback in part from Professor, Tye-Din, suggesting that we don't want to see a lot of dropouts in this proof-of-principle study. So we started at a lower dose of gluten at 2 grams and then up titrated it to 4 grams and then up to 8. But we'll show you shortly that there actually were a significant number of symptoms, and we were able to see some differentiation there.

Again, the endoscopy/biopsies were taking at baseline and at the end of the gluten challenge, so we could look at the morphology and histology, inflammation as Professor, Tye-Din was just outlining. And then we also had gluten challenge symptoms that were measured. This was done through the collection of patient diaries and AE reporting, and all of these subjects completed day 32 biopsy.

In terms of the baseline demographics, quite well balanced here across all of these different parameters, including the villus height to crypt depth ratio and the IEL counts. And with that, let me turn it back over to Professor, Tye-Din to talk through the efficacy readouts.

Thanks, Paul. So jumping straight into things. This is the marker of inflammation in the small bowel. So this is the intraepithelial -- oh no, sorry, we've got the VCIEL. So this is the composite score of the intraepithelial lymphocytes as well as the villus height to crypt depth. And what you can see here is clear distinction between the placebo group that worsens small bowel histology as expected with a 16-day gluten challenge. Patients get damage and inflammation and quite a striking difference in the treatment arm with FB102. There is none of that deterioration to mucosal health, and that is statistically significant.

Next slide. So when you break it down, this is the intraepithelial lymphocyte density now. So this is the marker of inflammation, the inflammatory cells that come into the small bowel that lead to the damage. And again, you can see an increase of around 13.3 of these IEL per 100 enterocytes in the placebo arm, and a decrease in the active arm with FB-102 of 1.5. And again, this is statistically significant. So it tells us that FB-102 is able to prevent the gluten-induced inflammatory damage.

Next slide. Okay. So with the villus height to crypt depth ratio, you can see that again, there is this trend for FB-102 to have a reduction in the worsening of villus damage. This time, it is not statistically significant, but there is a considerable difference between the placebo arm and the FB-102 arm. Again, supporting the notion that both the villus inflammation and the villus structure is improved by treatment.

What's really striking is the symptom protection that's afforded by the treatment arm. So here on the graph, you can see the 16 days of gluten challenge that participants undertook. And you can see here shown the cumulative symptoms at each particular individual experience. And you can see over time, not surprisingly, as they went along with their 16-day gluten challenge, the number of symptoms per subject started to increase, but there was about a 42% symptom benefit in the FB-102 arm.

In other words, it abrogated the gluten-induced symptomatology, which is a very striking finding. And really, the symptoms captured here were the most important ones introduced by gluten, such as nausea, diarrhea, vomiting, abdominal pain and bloating. And these are common and very often disabling symptoms. Certainly, in our group of patients that we had through the trial, there were some people who would typically vomit with the exposure to gluten, and these people were absolutely comfortable sitting there, eating their gluten and having no issues.

So this was quite striking to us. It was immediately apparent, not necessarily clearly demonstrated in this slide, but this slide does demonstrate how FB-102 is reducing gluten challenging induced symptoms.

Excellent. Thank you so much, and we'll touch on just the safety profile as well, very consistent with what we saw in the healthy volunteer study. Again, only 1 grade 3 severe AE, and that was in the placebo group, that was associated with the placebo -- excuse me, with the gluten challenge. That was a patient that had 2 events during the gluten challenge. One was nausea and one was vomiting, both Grade 3. But again, that was the only grade 3 event. Everything else was predominantly mild AEs.

And again, quite well balanced in terms of the organ class as well. In fact, favoring FB-102 across all of the different organ types, including infections and infestations, and across all these different parameters.

So with that, we are moving aggressively ahead, very positive data, and thank you again, Professor Tye-Din for your leadership in the study. As I mentioned before, Professor Tye-Din enrolled about 20% of the subjects in the study. And moving ahead, now we're going to be initiating a Phase II trial in celiac disease looking to enroll 100 patients. They'll be enrolled 2:2:1, with 3 different arms, 2 arms will be on FB-102. There will be an induction period where they will get 5 doses of FB-102, followed by a maintenance of every other week and at a 3-milligram per kilogram or 5 milligrams per kilogram.

And in this study, they'll be getting more gluten as well. So there will be an 8-week gluten challenge. It will start out at 8 grams per day for 2 weeks and then it will move down to 3 grams for the next -- per day for the next 6 weeks.

We are initiating the study imminently here in the second quarter. And we do expect the U.S. IND late in '25 or early '26. The top line data readout from this study should happen in 2026. Again, we need to see the enrollment rate. But assuming that the enrollment looks similar to the Phase Ib, we should have that readout in 2026.

So in terms of the development time lines, we just talked about celiac disease. I mentioned earlier, we have a vitiligo study ongoing as well. The top line data read out there in the first half of '26 and starting that Phase II also in '26, likewise with alopecia and type 1 diabetes where we've got some really compelling data there that we've generated in-house and is part of our corporate deck now. We're evaluating the study design and looking at the potential for initiation there as well.

So again, thank you, everybody, for joining. And I'd like to open the call up to questions.

[Operator Instructions] Our first question comes from Yaron from Cowen.

Congrats on the data. Really great to see. I have a few questions. Maybe just the first one, can you put a little bit in context of the baseline IEL data looks really compelling. I mean you're starting on both of them at around 25.6 and 23.5. What's been to clinically meaningful and maybe -- give us a sense that's obviously, showing a nice differentiation and separation early. But what level do you want to see? And how does it translate into clinical benefit? And then on the baseline villus height to crypt depth, you're starting at 2.8. So maybe do you think that data gets better with time, maybe put in context this -- how meaningful this data is?

Professor, Tye-Din, do you want to comment on that and then maybe I can add a few comments as well.

Yes, of course. Yes. So Yaron, that's some great questions there. So typically, we consider a change of around 30% in IEL count to be significant. And really what -- the way we conceptualize things biologically is that the IELs are the key inflammatory cells that ultimately drive the villus damage. So we know from many studies decades ago that this is a step-wise process. Early disease is often just the inflammation and then with time, you get the villus atrophy developing.

So with a 2-week gluten challenge, you probably saw that the villus change. The error bar was fairly wide there, which highlights that there is heterogeneity. Some patients got quite a lot of villus damage, some patients less so. And I think over time, with longer gluten challenges, you get much more consistency in the villus damage. So I'd be very confident that given the compelling reduction in inflammation that we've seen with FB-102, that would translate into much more statistically significant protection against villus damage with time. And I think this is really the rationale for the Phase II to go longer with gluten to really get that consistency in causing the damage in the placebo arm, and then showing greater differentiation in terms of the villus structures. So I hope that answers your question.

Great. So maybe on the Phase II, is it going to be powered? Is the -- and what would be the primary endpoint? Is the primary endpoint going to be still IEL? Or is it going to be villus height to crypt depth and [indiscernible] ?

Excellent question, and Yaron, this is Paul. So in the Phase II study, yes, we're -- that is power to look at. And not only are we looking at the histological and morphological parameters that we've demonstrated here, we'll have -- there'll be a composite analysis. We're looking, of course, at the IELs, which are critically important the VH:CD, but we'll have using a validated scoring tool for the symptoms as well. And given that in this study, in the Phase II study, we don't have that dose escalation of the gluten at 2 grams to 4 grams to 8 grams as we did in the Phase Ib to try to mitigate symptoms to keep patients in so that we really could see these histological effects.

Here in the Phase II, we're going to start off directly with that 8 grams per day for the first 2 weeks. And there, I think we're going to see some significant further differentiation on the symptoms as Professor, Tye-Din was just alluding to earlier.

Okay. And maybe just a final question for me, and I'll jump back into the queue. On the GI disorder side, there seems to be a little bit more -- well, both of them are sort of 88%, you have actually less nervous system disorders. Can you just put that in context, less inactive than placebo. Just put that in context, what are you seeing there?

Yes, those are just individual patient numbers. The actual event rates, as you saw in that symptom slide is significantly less for FB-102. And that really is the important part. I mean if we go back and we look into the symptoms specifically, I think about 30% of the patients on FB102 had no symptoms whatsoever to the gluten challenge, and that compared to only about 10% or 12% of the patients on placebo. So again, a significant differentiation there, and it really has to do with a number of events in terms of those symptoms relative to a patient maybe having recorded one.

And also, I think it's important to point out that the -- there was only one individual that had that severe Grade 3 AE and that was associated with the gluten challenge. That was actually, that one patient, as I mentioned before, had 2 grade 3 AEs, 1 was nausea, 1 was vomiting. So a significant differentiation not only in the number of events and those patients that had -- but had no symptoms on the gluten exposure, but also a difference in terms of the severity of the symptoms.

The next question comes from Daniil Gataulin at Chardan.

Quick one, just to kind of understand the thinking that went into Phase II design. So maybe can you talk about key learnings from Phase Ib that informed the design of the Phase IIb study and what went into the decision of going with the single or high dose that you selected and high gluten challenge right away?

Yes, absolutely. Thank you very much. In terms of that dosing, we have the induction and the maintenance and one thing that's still being explored is the possibility that there is an immunomodulation that's happening so that it's not just a PK. We're still trying to understand this point, but the possibility exists, and it's been, I think, a view that's shared by other researchers and other in the industry about the possibility that you're able to affect the population of these antigen-specific tissue resident memory T cells.

And if that's the case, then upfront, we want to have this induction so that we can deplete those cells and have a longer durability of effect. We're going to be investigating that in the Phase II, but that's the idea behind having that induction. And again, that 10 mg per kg dose has shown very good safety and tolerability to date, now from the healthy volunteer study all the way through the celiac study.

And so we're going to be continuing that, providing the good protection upfront and then starting that 8-gram gluten challenge, with -- for 2 weeks without doing that dose escalation so that we can see even further differentiation on the symptoms. And as Professor, Tye-Din was saying, the IELs really are what are driving the damage to the villi and frankly, causing the symptom effects as well. And so the fact that we've seen such great control in the Phase Ib leads us to believe that in that longer gluten challenge, we're going to see even further differentiation and even more positive data than the data we've generated here. So that really was the thinking behind it.

Got it. And a quick follow-up for the endpoints for IIb. How critical would it be to show statistic improvement in VH:CD ratio?

Well, I'll turn it over to Professor, Tye-Din to provide his comments, as we've talked about, IELs are really the mediators of the damage, not only in celiac disease, but also in these other disease indications that we're pursuing. And to see that level of control that we have here in this study, I think, is really, really encouraging leading to the symptom benefit, leading to what we saw with the VH:CD. And these composite endpoints, particularly the VCIEL developed by Professor, Murray at Mayo really is able to more holistically look at the damage to the gut. But Professor, Tye-Din, what are your thoughts?

Yes. Look, I agree. I mean I think that the FDA guidance for industry is fairly slim on what the right histologic endpoints are. They talk about co-primary endpoints of symptoms and histologic protection. We've looked at -- as gastroenterologist for decades, we've looked at both the villus height to crypt depth and the intraepithelial lymphocyte count. And the sort of scoring systems we've used like Marsh in the past and nowadays with VCIEL tend to sort of look at a composite of both the villus damage and IELs. I think it would be nice to see both IEL protection and villus damage protection. I'm actually pretty confident with what the Phase Ib data is telling us that this is likely to be the case as long as we drive enough damage into the placebo arm. So 8 grams a day, which is about -- it's almost about 3 slices of bread worth of gluten. So this is a decent amount of gluten that participants will be consuming.

And we would imagine that after the 7- or 8-week period of the challenge, there will be much more substantial damage both with the IELs and the villus height to crypt depth. So I think it would be very nice to see both, and I think this is what will happen. And I think that if you can combine that with the symptom and readout, then you're essentially meeting that composite co-primary end points.

The next question comes from Elemer Piros at Lucid.

What I'd like to ask from Dr. Tye-Din is if he could put this data set, which is obviously from a small trial to perspective of other agents that have been examined in celiac disease and particularly when comparing it to other IL-15 inhibitors. And if there is a thought process here that the combination of IL-15 and IL-2 modulation may be more important than just focused on going a single pathway?

Thank you, Elemer. I think that's an excellent question. To start with your latter query, I absolutely agree. I think that -- the -- honestly, the IL-15 data alone has shown protection against gluten-induced damage, but I haven't been completely blown away by that data in isolation when it's just IL-15 blockade. And certainly, I've not seen any data showing that this blockade can protect against gluten-induced symptoms. It may seem to abrogate some gluten-induced gut damage. What I think is really the strength here and my background in celiac research has been very strongly focused on Interleukin-2 as a key role in expanding the gluten specific T cells, the core celiac disease is the blockade of Interleukin-2 is, I think, a major benefit of FB-102 and I think that is probably what is really contributing to the substantial beneficial effect on blocking gluten-induced symptomatology.

So I agree. I think it's the combination of potent IL-15 blockade as well as IL-2 blockade that's contributing to the therapeutic effects. Now I've forgotten what your first question was, sorry. Yes. That's right. So it's just comparison to other sort of agents currently under development.

I've been impressed by this data in all honesty and also being involved in the clinical trial with my nurses, and we've done 7 other celiac disease sponsored trials in other agents. This has been by far the most -- the trial that they've enjoyed the most because participants were very tolerant of the agents, many who were expecting to vomit with the gluten challenge did not, so they were able to push through.

And I think that our experience and sort of insights into the other therapeutic compounds, you know that there are tolerogenic approaches. There's a number of groups now looking at ways to try to induce gluten tolerance. I think that's a very high bar. I was involved in the very first gluten tolerogenic study of Nexvax2 that was a U.S. and Australian, New Zealand Phase II trial that unfortunately failed. But then this -- as you may be aware, there's other groups now developing tolerogenic therapies.

I think biologically, that's a very high bar to cross over to induce tolerance against gluten, which is very well strongly established, and you have these tissue resident memory-specific gluten T cells that are very hard population to get rid of. You have glutenases which are gluten degrading enzymes, but these are really needed to be taken on demand really or regularly because whenever there's gluten, you need to have this agent around. So this is not something that will hang around in the system, you will need to take it every time you have a meal.

So I think that's a niche need. I think that might be useful for people traveling, but it's certainly different effects than an immune-based approach. And there are other groups developing other immune approaches, such as bispecific antibodies that block the T cell response to gluten. And look, I think that it's still fairly early days with that approach as well. So -- on the haul, I think that if you can demonstrate, I think the key is to demonstrate protection from gluten-induced gut damage and symptomatology and that will really set you up for future trials and demonstration of protection in both treated disease, but also in active disease.

Thank you very much for your perspective. Dr. Tye-Din. Congratulations, Paul.

The next question comes from Kumar Raja of Brookline.

Congratulations on the data. With regard to the density of the CD3 positive sales, what are your expectations with the longer duration of treatment? Do you think there will be ability to further reduce it. And with regard to the -- starting the trials in the U.S., can you please share what are the next steps there?

Sure. I can provide some perspective on that and then I'd be interested in hearing Professor, Tye-Din's perspective. Above 25 is considered the IEL is considered celiac disease subject or patient healthy individuals, to my understanding, have IEL densities that are maybe closer to 10, 10 or 15. So certainly, even in the treated celiac patient population to my understanding and as evidenced here with the baseline characteristics of these treated celiac patients, we did have a baseline up around 25. And so I think there is room to continue to move that down towards normalization of the IELs in the villi. And we did see that. We did see that over this relatively short study, we're already seeing a decline in the IELs. We'll have additional data on the TCR gamma deltas and the subsets of the Ki-67 that I'm very optimistic about, let's just say. But those subsets are also responsible for some of the cytokine release as well as the inflammation.

And I think in totality, the data set was really encouraging in terms of the control and further normalization of the inflammatory component of the disease. Professor, Tye-Din, did you have any perspective on that?

I guess I'd just add that even though we're targeting treated celiac disease, what we know from other studies is there's no such thing as perfectly treated celiac disease. And I think this really underscores the fact that a lifelong, strict, absolute zero gluten, gluten-free diet is aspirational, but rarely attainable.

And so you often find quite a high proportion of patients entering these trials with so-called strict adherence to their gluten-free diet who have evidence of some degree of inflammatory activity both with raised IELs over 25. And also, a villus height to crypt depth ratio is less than 2.5. And in some studies, I've been involved in the 60% of patients with treated disease had VH:CDs less than 2.0.

So I think this underscores the importance of targeting the treated group who still have evidence of disease activity. And I think that, again, demonstrating that protection from gluten-induced inflammation is the key.

Great. I'll now hand the call back to Paul for concluding remarks.

Fantastic. Thank you so much. I really appreciate everyone joining this call and for your support. I also want to thank -- I know there's going to be -- they're going to be listening in on this call, the investigators in the study, the colleagues of Professor, Tye-Din, who really did a phenomenal job on this study and also the Forte team, just incredible, incredible hard work to get to these results. And so thank you to the team, and look forward to following up with you all throughout today and tomorrow and look forward to continuing to have your support. So thank you again.