Brii Biosciences Limited (2137) Earnings Call Transcript

Good day, everyone. [Operator Instructions] Please be advised that today's call is being recorded. This call will be conducted in English. This is Kathy Yu, Associate Director of Investor Relations. Welcome to Brii Bio's 2025 Interim Results Conference Call. Our interim results announced can be found on the Investor Relations section of our company website. Before we start, I would like to remind everyone that today's call may contain forward-looking statements which involve several risks and uncertainties. Actual results and outcomes may differ materially from those mentioned in today's announcements and these discussions. In addition, any forward-looking statements represent our views only as of the date of this call and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update such statements. Joining us today on the call from Brii Bio's corporate executive team are: Dr. Zhi Hong, Chairman and Chief Executive Officer; Dr. David Margolis, Chief Medical Officer; and Dr. Ankang Li, Chief Strategy and Financial Officer. Dr. Hong will begin with an overview of our strategic priorities and corporate updates. Then Dr. Margolis will review our HBV clinical programs; followed by Dr. Li, who will review our financial status. We will then open the call for questions. Now over to our CEO, Dr. Hong. Dr. Hong, please go ahead.

Sorry about that. And thank you, Kathy. Good morning, and good evening, everyone. Welcome to our 2025 interim results conference call. I am pleased to share with you our achievement in the first half of 2025 with you. We made meaningful progress across our clinical programs, while continuing to advance our broader corporate strategy. First and foremost, we advanced our core HBV functional cure program through multiple Phase IIb studies, data from the ENSURE study, particularly from Cohort 4, which we presented at the APASL and EASL early this year, offer encouraging evidence that BRII-179 can enhance anti-HB surface antigen response and accelerate HBV surface antigen loss, two critical data insights that are helping to define our future combination regimens. Running our two confirmatory study in parallel lines is accelerating the evaluation of treatment synergies, enabling us to shape our late-stage development strategy based on the emerging data, bringing together a curative regimen based on the data insight from Cohort 4 of the ENSURE study that BRII-179-experienced participant achieve faster HBV surface antigen loss. We amended the protocol of our ENHANCE study to evaluate a simplified combination regimen of BRII-179 and elebsiran plus PEG interferon aiming and shortening PEG interferon treatment duration to 24 weeks from 48 weeks. At the same time, we continue to propel our other program through internal innovation as well as external partnership. We out-licensed the Greater China rights of soralimixin, formerly known as BRII-693 to ensure that our non-core program progressed efficiently without diverting our primary focus on HBV. We are also making ongoing investment in early discovery program. Our HBV program remains our top priority. We are working diligently to achieve a higher rate of functional cure. Our multi-MoA approach includes several Phase IIb combination study of our lead candidate, BRII-179 and elebsiran. The data we have seen so far in our ongoing study gave us the confidence that combining these assets may lead to a higher functional cure rates across a broader range of HBV patient population. As we focus on HBV, we are seeking a strategic partnership to develop other assets in our pipeline, including the long-acting HBV candidate BRII-732 and BRII-753. Most recently, we entered a license agreement with Joincare Group for soralimixin and targeting multi-drug resistance and extended drug resistance gram-negative bacterial infections. The license covers the research development and commercialization of soralimixin in the Greater China, where there is a growing threat of antimicrobial resistance. BRII retains the rights of soralimixin outside of Greater China right and are looking for non-dilutive funding and partnership opportunities. Our HBV functional cure strategy is built on three differentiated assets: BRII-179, elebsiran, and tobevibart. Each target a distinct mechanism of HBV pathogenesis. Together, they form a multi-MoA platform designed to drive immune restoration, reduce viral persistence and achieve higher cure rate across patient population. BRII-179, our proprietary therapeutic vaccine has shown potential in priming HBV-specific immune response, elebsiran siRNA works to surprise HBV antigen production, where tobevibart is broadly neutralizing antibody and support antigen clearances and then potentially HBV, HDV co-infection population. All three candidates have demonstrated encouraging profile that have been granted Breakthrough Designation by CDE in China, highlighting their potential in treating chronic HBV infections. And our partner, Vir Biotechnology, have recently started all the Phase III programs and looking at elebsiran and tobevibart combination in treating HBV, HDV co-infected patient population. So far, our clinical program have collectively been studied in more than 1,600 patients. We now have three fully enrolled Phase IIb combination study: the ongoing ENSURE study and ENRICH study and the ENHANCE study. Each strategically designed to optimize a sequential or combination regimens. These studies are essential in our effort to define a registration pathway forward with the goal to achieving highest possible functional cure rate. The key insight emerging from our previous study is the potential of BRII-179 and for its ability to enrich and identify patients most likely to benefit from the curative regimen. And despite promising advancement, many HBV patients can -- may not achieve functional cure rate -- functional cure with the current therapy alone. BRII-179 offers that unique ability to prime the immune response and help to distinguish responders to anti-HBV surface antigen. They induce immune response and identify the patient immune capable patients may lead to a greater probability of achieving functional cure. In our updated data of Cohort 4 of ENSURE, at week 48, end of treatment, 61% of BRII-179 responders achieved HBV surface antigen loss compared to just about 10% of non-responders. Moreover, among all participants achieved HBV surface antigen loss at the end of treatment, BRII-179-experienced participants achieved HBV surface antigen loss faster than HBV -- then BRII-179-naive patient, among which 83% of BRII-179-experienced participants achieved HBV surface antigen loss within 24 weeks compared to 55% of BRII-179-naive patients. This result supports the potential of BRII-179 both as immunotherapeutics, also a profiling tool, enlightens us with to explore different combination in our later confirmatory Phase IIb study. Particularly, this enrichment strategy can help optimize clinical outcome, while making more efficient use of healthcare resources. This approach is what sets our approach apart, not just stacking mechanism, but using them to intelligently guide the treatment design and strategically deliver the right combination to the right patient population. So with that, I will now hand it over to Dr. Margolis for a deeper look at our clinical program. David?

Thank you, Zhi, and hello, everyone. I'm pleased today to walk you through our latest clinical program focused on specifically, our three Phase IIb studies in HBV, the ENSURE study, ENRICH study, and ENHANCE study. These three trials collectively represent our multimodal strategy designed to deepen our understanding of HBV functional cure and define an optimized path forward towards registration. Each of our three ongoing Phase IIb studies build on prior findings to explore distinct treatment combinations, advancing us towards an optimized development pathway. They are designed to assess additive or synergistic effects of BRII-179 and/or elebsiran and help identify the most effective combinations and responsive patient populations. Running these studies in parallel enables real-time learning, responsive trial design and efficient advancement towards regulatory approval. As a refresher, the ENSURE study evaluates the contribution of elebsiran in driving functional cure in combination with pegylated interferon alpha. Cohort 4 of the study also examines comparisons between BRII-179-naive and BRII-179-experienced patients, helping to inform sequential strategies and BRII-179's potential priming effects. The ENRICH study evaluates the role of BRII-179 as both an immune primer and a profiling tool to identify immune responsive patients who may have a higher probability of achieving functional care. Lastly, the ENHANCE study includes two parts. Two cohorts under the original protocol, evaluate the concurrent triple combination regimen of BRII-179, elebsiran, and pegylated interferon to enhance functional cure rates. An amended cohort was added based on the results coming out of Cohort 4, which suggested that BRII-179 induced immune response has the potential to prime patients to achieve faster HB surface antigen loss, supporting a shorter course of pegylated interferon alpha. This amendment reflects our goal to reduce treatment burden while preserving efficacy in broader patient populations. Next I'd like to further illustrate the latest update from each of these studies. At EASL 2025, we presented 24-week post-treatment follow-up data from Cohorts 1, 2, 3 of the ENSURE study, and 48-week end of treatment data from Cohort 4, which was designed as a proof-of-concept for BRII-179's role in immune profiling. The updated data from Cohorts 1, 2, 3 reinforce the key value of elebsiran in our HBV functional cure strategy. At 24 weeks post treatment, elebsiran in combination with PEG interferon alpha achieved HB surface antigen loss and 33.3% of patients in the 100-milligram group and 21.1% in the 200-milligram group compared to just 5.6% with PEG interferon alone. These results further validate siRNA as a core mechanism in reducing viral antigen. We also observed that 83% of patients who achieved HB surface antigen loss, developed anti-HBs antibodies, most with titers exceeding 100 IU per liter. This strong association between HB surface antigen seroclearance and anti-HBs seroconversion reinforces that immune restoration is a hallmark to functional cure. In Cohort 4, patients were grouped based on their peak anti-HBs titers from prior BRII-179 exposure, either greater than or equal to 10 IU per liter were classified as responders and less than 10 IU per liter as non-responders. What we observed was a clear stratification of response. BRII-179 responders achieved a 61% HB surface antigen loss rate at week 48 when treated with PEG interferon alpha plus elebsiran compared to just 10% in non-responders. These findings support BRII-179's role as a potent therapeutic vaccine as well as a strategic tool for patient enrichment and immune profiling. By identifying patients most likely to respond to curative therapy BRII-179 may help to personalize treatment decisions, optimize trial design and ultimately improve cure rates, while minimizing unnecessary treatment burden. A key insight emerging from our previous studies is the potential of BRII-179 to enrich and identify patients most likely to benefit from curative regimens. Despite promising advancements, many HBV patients may not achieve functional cure with current therapies alone. And BRII-179 offers a unique ability to help identify patients who can better respond to these curative regimens. The identified immune capable patients or the anti-HBs responders may have a greater probability, therefore, of achieving functional cure. In Cohort 4, the ENSURE study, the immune profiling and potentials of BRII-179 are both observed. As I just shared, the immune capable patients were identified through peak anti-HBs levels induced by BRII-179 in previous studies, and they achieved higher HB surface antigen loss compared to the non-responders. In addition, we found that among all participants achieving HB surface antigen loss at the end of treatment, BRII-179-experienced patients achieved faster HB surface antigen loss than those that were naive to BRII-179. 83% of BRII-179-experienced patients achieved surface antigen loss within 24 weeks compared to 55% in BRII-179-naive patients. These results support the potential of BRII-179 as both an immunotherapeutic and as a profiling tool and it enlightens us to explore different combinations in our later confirmatory Phase IIb trials. Particularly, this enrichment strategy can help optimize clinical outcomes, while making more efficient use of healthcare resources. Such maneuvers set our approach apart. Not just looking at multiple mechanisms, but using them intelligently to guide treatment design and strategically to deliver the right combination for patients. The ENRICH study is designed to prospectively validate our enrichment approach as well as the priming effects of BRII-179. Patients received BRII-179 as an immune primer followed by combination therapy with elebsiran plus pegylated interferon alpha. The aim is to determine whether immune responders identified via BRII-179 induced anti-HBs production have a higher likelihood of achieving functional care. As an innovative development approach, this study allows us to better characterize the immune profile of chronic HBV patients and potentially identify those patients who are most likely to benefit from intensive treatment regimens. Meanwhile, the ENHANCE study, we're taking the next step of evaluating our comprehensive triple combination regimen. The two cohorts under the original protocol assess whether adding BRII-179 to the elebsiran plus PEG interferon alpha combination can drive additive or synergistic benefit. In addition, the new cohort under the amended protocol aims to shorten the pegylated interferon alpha treatment duration from 48 weeks to 24 weeks in BRII-179 prime patients, by evaluating a new triple regimen cohort with BRII-179 and BRII-835 combination treatment followed by this added shortened course of pegylated interferon alpha. In July of 2025, we completed the participant enrollment of this amended cohort. This amended design is based on the findings from the ENSURE Cohort 4 which suggested that BRII-179 can induce robust immune responses that allows the patients to take a shorter course of pegylated interferon alpha to achieve cure. This approach provides alternative treatment options to satisfy differentiated clinical needs. To summarize, given the heterogeneity of HBV patients' immune profile in the critical role of the immune therapeutic in the combination regimen, the ENRICH and the ENHANCE studies each explore a unique dimension of the role of BRII-179 in combination treatment. This framework enables us to define an optimal regimen to mitigate risk in late-stage development and to generate a rich data set to guide regulatory engagement. We have engaged with CDE of NMPA on potential Phase III study designs and primary endpoints. And those discussions will continue following Phase II data readouts. Running these trials in parallel has allowed us to iterate rapidly, test hypotheses in real time and adapt protocols based on emerging data. We believe this multimodal parallel approach is critical to solving the complexity of HBV cure and bringing forward the most effective regimens. Looking ahead, we expect several key milestones to shape the next stage of our HBV program. In the second half of 2025, we plan to report 24-week follow-up data in Cohort 4, the ENSURE study, end of treatment data from our ENRICH, and ENHANCE studies are expected to be released in the first half of 2026. These upcoming results will guide our potential registrational development pathway and further define different combination treatment regimens to maximize clinical benefit. I will now hand over to our Chief Strategy and Financial Officer, Ankang Li.

Thank you, David. And thank you all for joining this call. As a reminder, the financial figures I will review today are in RMB unless otherwise noted. We maintained a strong cash position with sufficient funds to support our operations through 2028. As of June 30, 2025, our bank deposits and cash and cash equivalents were RMB 2,075.3 million, representing a decrease of RMB 338.1 million or 14% compared with RMB 2,413.4 million at the end of 2024. The decrease was primarily due to the payout of daily operations and research and development activities. Our other income was RMB 28.1 million in the first half of the year, representing a decrease of RMB 42.8 million or 60.4%, compared with RMB 70.9 million for the 6 months ended June 30, 2024. This was mainly due to a decrease in bank interest income of RMB 21.6 million attributable to the decrease in interest rates on Chinese yuan and Hong Kong dollar time deposits, and reallocation of short-term deposits to money market fund investments, and a decrease in income recognized from PRC government grants. We effectively controlled our operational costs through disciplined pipeline prioritization and organizational streamlining, while maintaining continued investment in core programs during the first half of 2025. As a result, our research and development expenses for the first half of the year declined by 7.3% to RMB 117 million from RMB 126.2 million for the first half of 2024. The reduction reflects decreases of RMB 6.4 million in third-party contract costs and RMB 3 million in employee costs. Administrative expenses were RMB 58.2 million in the first half of the year, declining 26.0% compared with RMB 78.6 million in the first half of 2024. The decrease was primarily attributable to decrease in employee costs of RMB 9.5 million and decreased facility-related costs and professional service fees of RMB 8.4 million, which was primarily attributable to organizational optimization and effective cost control management. Our solid financial footing allows us to advance our HBV program into late-stage development, while continuing to invest in early discovery efforts that support our strategy of pairing internal innovation with external collaborations. This balanced approach positions us to drive sustainable growth, deliver long-term shareholder value, and broaden patient access to meaningful treatment options. This concludes our prepared remarks. We will now open the call to your questions. Kathy, please go ahead.

Okay. Thank you, Ankang. We will now open the line to Q&A. [Operator Instructions]

My name is Michael on for Roanna Ruiz from Leerink Partners. My question today is, given the encouraging 61% seroclearance rate in BRII-179 responders from ENSURE study Cohort #4, how are you thinking about patient enrichment strategy moving forward? And will you consider a biomarker-driven approach to identify the 179 responder earlier in the study? And how might this impact your Phase III study discussions with NMPA?

Thank you, Michael, for the question. I'm going to defer this to our CMO and David Margolis to answer this question. David?

Yes. Thanks, Zhi, and thanks, Michael, for the question. We see the data from Cohort 4 is very insightful and very encouraging. It's clear to us that BRII-179 has the potential to categorize chronic HBV patients into these immune responsive, I mean, immune non-responsive, that's now been observed in our preliminary studies with 179, where we observed the effect. And now we see the consequence of that, where the efficacy appears to be higher in that subgroup of patients. So we are keenly interested in understanding how to bring that forward through Phase III trials, and we are in discussions with regulators about the possibility of doing that. As you said, that might include the evaluation of the anti-HBs levels in those patients that are pretreated with 179. So that's something we're exploring as a possibility. We're not exclusively looking at the responder versus non-responder. We're also looking at kind of the totality of the response. So one of the key insights that we expect to get from the ENHANCE study is looking at this triple combination of 179 plus elebsiran plus PEG interferon as a unique combination, but also looking at the priming aspects in the amended cohort, as we mentioned. So I think, those strategies are still alive and where we have been in active discussions with regulatory authorities about Phase III design to evaluate that question.