ProKidney Corp. (PROK) Earnings Call Transcript

All right. Let's go ahead and get started. Welcome, everybody, to the JPMorgan Healthcare Conference. My name is Anupam Rama. I'm one of the senior biotech analysts here at JPMorgan, joined by my squad, Priyanka Grover; Malcolm Kuno; and Rati Pinge. Our first presenting company of the day is ProKidney. Presenting on the behalf of the company, we have CEO, Bruce Culleton.

So I'd like to -- good morning, everyone. I'd like to start by thanking Anupam and JPMorgan for inviting us to the conference this year. It's a pleasure to be here. Make sure I can use this the right way. So these are our customary disclosures and disclaimers. It also means that we have a legal team. And I'm going to start about -- I'm going to talk today about disrupting the CKD treatment landscape. And I'll start here. And for those of you that are new to ProKidney, we're a pre-commercial autologous cell therapy company. And we're focused on treating patients with advanced chronic kidney disease and diabetes, type 2 diabetes. We went public in 2022. After about 10 years of clinical, early clinical, preclinical research. And I want to start by -- I know they're not in the room, but also acknowledging the 200 or more employees, a little bit over 200 employees that we have and all the enormous progress that they made and we made in 2024. So this time last year, we were at [ JPM ] and we were talking to investors about how we pause our manufacturing program and how we paused our Phase III clinical study program. And in many ways, this was really a call to action for us to reset our company. And it wasn't just an approach we made on quality and manufacturing. We also repositioned our product. We repositioned our Phase III clinical study program. We changed our communication to patients, to providers, to the FDA to investors. And importantly, we also changed how we work as a company. And I'm very proud to be here today and say that we got through our remediation efforts from a manufacturing perspective, and we restarted treating patients mid this year, and we've made some significant progress around our clinical study programs since then. So that's been an enormous lift and a real callout to our 200-plus employees. So our product. So we start by harvesting a small piece of kidney tissue through a typical kidney biopsy. That kidney tissue is then transported back to our manufacturing facility. We isolate kidney cells and we expand them through a series of different steps. We end up in some cases with over 1 billion kidney cells. They're primarily tubular and epithelial in origin. They become more differentiated through the manufacturing progress -- through the manufacturing process. They're not progenitor cells, but they become a lot more de differentiated. We take some of those cells and store them, and we take some of those cells and send them back to the clinical study site. They're cryopreserved for that storage as well as the transport and then the number of cells that are injected into the patient's kidney is done through an interventional -- with an interventional radiologist using a CT scan. And those cells are then injected into the kidney cortex, based upon the patient's kidney size and weight and the number of cells that are reinjected range typically anywhere from about 250 million all the way up to about 800 million, depending upon the kidney size. Now this slide is complicated, but it is meant to illustrate where we play as a company. And we are playing in an area of great unmet clinical need. And what you see on this slide is a framework of how we think about not we, the community, scientific community thinks about kidney disease staging and kidney disease risk. On the horizontal, the rows, you'll see kidney function as measured by eGFR. In Stage 5, down at the bottom is kidney failure. That's typically eGFR less than 15%. Think about that as you've got 15% or less of kidney function left. We're primarily operating in the eGFR between 20% and 35%, which is Stage 4 and late Stage IIIb. The vertical rows -- the vertical columns represent how much protein is lost in your urine, and some diseases lead to more protein loss than others. The more protein that's in your urine, the higher risk you are progressing on to kidney failure. And we're primarily operating in the highest risk groups, where there's a big unmet need and where typically patients are seeing nephrologists and the conversation is, you've continued to progress. We need to start thinking about what type of dialysis you want or if there's anyone that may want to give you a kidney. There's been -- I mean, this last 5 years in this space has been amazing progress, which is great to see for patients. We have many different landmark clinical trials, which has really changed the therapeutic landscape for patients with diabetes and chronic kidney disease. As you could see here on the far right of this slide, most of those subjects have Stage 2, Stage 3, few subjects of Stage 4 chronic kidney disease. Most of the studies are done in patients with Stage 2 and Stage 3 chronic kidney disease. And there are lots of reasons for that. But primarily, that's where a much greater prevalence of disease exists. And in the Stage 4 chronic kidney disease space, the estimates aren't great, but there's probably about 1 million people in the U.S. today that have stage 4 chronic kidney disease. About 40% of them to 50% have coexistent diabetes. So that's the target market that we're really thinking of. So in addition to the data that is primarily in Stage 2 and Stage 3 chronic kidney disease, many of these studies also show the same -- pretty much the same thing. And the same thing is, on the left-hand side, you'll see a measure of kidney function over time. And it's the change in eGFR over time. And what you see with a lot of these products is that even though they work at the end of 3 years or 4 years, there's a minimal difference in kidney function between the interventional product, in this case, an SGLT2 inhibitor or placebo. So in this case, it's about a 1 millimeter per minute per year change at the end of 4 years, doesn't sound like much. And in fact, it isn't a whole lot clinically. But what you do see is in big studies, you see that there's a difference in clinical end points. So it has a clinically meaningful difference in outcomes for patients. But if you look at the blue line here, which represents one of the SGLT2 inhibitors, you see that over the course of 28 months A lot of these patients continue to have events. Some patients continue on dialysis. Some patients continue to lose over 50% of their kidney function. And some patients die or have cardiovascular events. The residual risk remains substantial in a lot of these studies, even though the products work. And one way to think about that residual risk is a number called number needed to treat. And in this study, for example, You'd have to treat 19 patients with this SGLT2 inhibitor to prevent 1 primary outcome event. So that highlights the underlying residual risk in most of these studies. Now we'll step now into our clinical program. I'll give you an update on our clinical program, an update on our Phase II study, and we'll end with sort of a picture of what our cash runway looks like. So we've completed 3 clinical studies in different patient populations. Our Phase II study 002, we presented the results of that in the spring of this year, the final results. You're going to hear today about 007, which is our other Phase II clinical study program. Where we progressed over time is early on we injected patients with fresh product into the kidney that was biopsied and then 3 to 6 months later, injected that same kidney. So we did that because we weren't really sure of the safety profile early on. As we've gotten more confident with their safety profile, see all the safety data that we have, we felt confident and so that the regulators say, okay, you can inject the second kidney. So where we have -- where we are today is we don't have a fresh product anymore, it's cryopreserved, as I mentioned. We initially inject the kidney that was biopsied and then 3 months later, we inject the other kidney. We think that should have a greater impact on stabilizing kidney function over time. So here's a summary of where things were in 2024 and where we're going in 2025. So as I said, we presented the results of our 002 Phase II study at the end of the second quarter. What we saw was stabilization of kidney function for up to 30 months in some patient groups. What we also saw was in patients who had the highest risk of kidney failure, those with eGFR less than 30 and in that red area in that matrix, I showed you, if you're a less than 30 and high levels of proteinuria, we saw that patients treated with repair and cell had a much slower progression of kidney disease over the course of 12 months. And we use that data to then amend our Phase III study to be more focused on that patient population. Now mid-last year, we also presented interim results of Study 007, I'll show them to you in a few minutes. And then we also restarted our Phase I or Phase III randomized controlled trial called proact 1. We also, over the course of 2024, really made some great progress in working with the FDA. So we were granted RMAT approval in 2022 and working with CBER. And at that point in time, the team had been going forward with 2 global Phase III studies. This year, we made a decision to stop 1 of those studies, the one that the study that was primarily outside the U.S. because we had an RMAT and because we felt under the RMAT that one study was going to be sufficient that decision was validated by the FDA in a meeting that we had in October. And also in that meeting in October, the FDA opened the possibility for us to have an accelerated approval using slope eGFR. And so we're working with the FDA. We continue to work with the FDA on that. They're actually quite interested in the progress that we've made. We continue to work with the FDA on looking at what that analysis would be primarily how big the sample size needs to be, when would we have some type of readout. We feel pretty comfortable that, that analysis and that readout will pull in our dates that we've previously communicated around the top line results of our Phase III program. And then this year, we expect to release the full data from Group 1, I'll show you what that means in our study 007. And that's really important because we're looking at change in eGFR over time and that change in eGFR slope will then give us some indication into what our accelerated approval analysis could look like in our Phase III study. So hopefully, I'll add some clarity to that in the next few slides. So this is the design of our Phase III proact 1 study. So this is our confirmatory study, our pivotal study for approval and it's a randomized, controlled sham controlled blinded study of over 600 patients who have diabetes and chronic kidney disease, it's an eGFR between 20% and 35%. The endpoint for confirmatory -- for the confirmatory endpoint is a composite endpoint that's been used in many of the other landmark clinical trials. It's really time to dialysis, time to transplant, death from renal or cardiovascular disease, or at least a 40% reduction in eGFR. What you see in the bottom right-hand part of the slide is the potential accelerated pathway that we think will come to an agreement on with the FDA this year. And that's all around using eGFR slope as a surrogate for that confirmatory endpoint. We expect to let the community know what that analysis is going to look like and the timing for that analysis, the top line readout. We expect to let you know about that sometime this year, hopefully around midyear. So let's just switch gears and talk about our 007 interim analysis. So this is an open-label study. The last time we looked at the data was back in May, and then we released them, we presented the data through a series of releases and eventually presented at the American Society of Nephrology meeting in October of 2024. So this is a randomized uncontrolled study. So patients with type 1 or type 2 diabetes, type 1 or type 2 were randomized to either Group 1 or Group 2 and Group 1 is the 1 that's most important to us, given where we are today and given where our Phase III program is and now the relevance of an accelerated approval pathway. And in Group 1 of the study, if you were randomized to that group, you're going to biopsy, you made your product, you got to inject it into the biopsy kidney, and then 3 months later, you can inject it into the other kidney. Same dosing regimen that we're using for the Phase III study. Primary endpoint, change in eGFR, that's relevant because now that's part of our accelerated approval analysis. Group 2, which was, I think, of interest when the study was designed, but certainly a lot less relevant today given where we are. Group 2 was if you get randomized to Group 2, you've got a biopsy, made your product, you got an injection and the product was available, and then you waited and you waited until something happened to get a second injection. And that something to happen was either a decline in eGFR of more than 20% from baseline or an increase of greater than 30% or greater than 30 milligrams per gram in protein in your urine as measured by UACR. And what I can stand here and say to you today is that that waiting is not as good as going forward and injecting a patient twice. So when we did the interim analysis, our objective was to look at patients who had 12 months follow-up after their second injection in group 1. And we also wanted to look at safety, obviously. Quick description of the analysis of the flow of Group 1 patients. 26 patients were in group 1. We lost a couple of subjects because we couldn't make cells for those 2 subjects. We have a success rate of about 95% and this is obviously a little bit higher than that 95%, but small numbers, but that's where we are with our overall product is about 95% or more patients. We can make cells on them. And then we were left with 22 subjects after 1 person died unrelated to the injection before 12 months of follow-up and one person had a bleeding risk and couldn't get injected. So as of May of last year, we had 13 subjects who had 2 injections and at least 12 months follow-up. Quick description of what those patients look like. eGFR was around 30%, so it reflects the population of interest here. UACR was high, which also reflects our goal here. The only point I'll make here that was surprising that we are mitigating for our Phase III study is 100% of these patients in this analysis were white. Now anyone that follows the kidney disease space knows that patients on dialysis, black patients, Hispanic patients are overrepresented on dialysis. And so this is an unacceptable look at patients and so we really -- we've brought in leaders who are driving forward better recruitment, better diversity who have a focus on actually recruiting patients from other communities to reflect the underlying population of chronic kidney disease. And we're making some real progress on that in our Phase III study. So because this is an uncontrolled study, we asked the question, well, what would happen to a control group? Like the study was designed without a control a few years back. And so we really wanted to know, well, if we were able to synthetically design a control group, what would have happened to their change in kidney function over time. So we worked with an outside group, Dr. Nav Tangri, who's 1 of the leaders in changing kidney function, eGFR measurements, risk in the kidney space. We worked with him and his team to perform a 10:1 match on our 13 subjects, 10:1 match with subjects he was able to pull from his access to some of the other clinical studies that I mentioned earlier on in this presentation. That matching was done by a software program that they have that's now being used by health care systems and they performed a machine learning, if you like, matching to get close to a 10:1 match. They got to 125 subjects and not quite 10:1, but very close. And this is what they saw under change in kidney function over the course of 18 months. So they saw a change of about 4 mls per minute. And over 12 months and about 6 mls per minute over the course of 18 months. And that's not atypical for this population. This is kind of where you'd expect this population to fall. When we looked at our 13 patients, small numbers, right? So when we looked at our 13 patients who we followed for at least 12 months after their second injection, this is what we saw. There's an upper panel on a lower panel. They both tell the same story. The upper panel has changed from baseline and eGFR. The bottom panel is absolute eGFR at the different time points, the average absolute eGFR they really tell the same story. What essentially we saw was over the course of 18 months, a change of about minus 1 ml per minute. And what you see in healthy adults who are in their 50s and 60s and 70s, that's about what you see as part of the normal aging process, about minus 1 ml per minute per year. But small numbers, I think it provides us a signal along with the other Phase II study that we're seeing a benefit of the product. We also have more safety data that we looked at in this study. We didn't see any serious adverse events with repair and cell. We did see hematoma in 49 subjects that were injected. What -- essentially, what we've seen over time is a pretty robust safety profile. The data that we see is very consistent with the long history of patients over half a century longer, we've been having kidney biopsies. We see a very similar safety profile. In fact, they're a little bit better. And I think it's a little bit better because we're very controlled. We have a training program. It's done by interventional radiologists. Unlike when I was training, we didn't use radiology. We essentially use an ultrasound well, we used an ultrasound at the bedside, very different today. These are trained interventional radiologists. And we've got a training program that seems to be working quite well at preventing adverse events and patients entering their studies. So our key findings then in our 007 interim analysis was Group 1 patients who had at least 12 months of follow-up. Kidney function was preserved or stabilized over 12 months. These were high-risk patients, patients with type 1 or type 2 diabetes with advanced kidney disease. In bilateral dosing. This is the first study that we presented with bilateral kidney dosing showed a safety profile consistent with our prior studies and comparable to the long history of doing kidney biopsies on patients with kidney disease. Now looking forward, we're going to have full results from Group 1 of 007 by midyear this year. We're focused on enrolling patients in our Phase III proact 1 study, just the 1 study that's required for confirmatory evidence from the FDA. We expect full top line results from that towards the end of 2027, and we'll get back to the community around what are we doing with our accelerated approval? What's the timing on that? What's the sample size? What's the effect size we expect from doing an eGFR slope analysis. And so that we should know more about halfway through this year. And I'll just leave this up. We do have our cash runway extends into now early 2027. And thanks for your attention. I'll leave it there and Anupam take some questions.

Yes. Thanks, Bruce. So I just want to remind folks, there are 3 ways to ask a question, right? There's the old school way where you raise your hand, and I'll call on you. There's -- you can shoot me an e-mail. And I guess there's an intermediate strategy where you can put it in the portal, and it will pop up here, and I'll ask it.

But I'll start out, Bruce, if that's cool, which is -- how are you defining a win scenario on 007 in the first half on the key endpoint of eGFR. We talked about kind of the healthy the 1 ml per min change is basically a healthy person. And then are there additional analyses beyond eGFR that we should be looking at?

So I think a win scenario for us would be very similar curves to what I just presented on the 13 subjects. And we'll have 20 subjects, 21, 22, somewhere in that ballpark that will have over 12 months follow-up after their second injection. And I think a win scenario for us is a very similar lines there, Anupam. It's -- and that, again, as you said, it reflects sort of normal kidney function decline with aging. And then with regards to other data that we'll present, obviously, we'll talk about if anyone died, we'll talk about, if anyone got on dialysis. We'll look at those hard endpoints, but I don't see that being sort of any takeaways from that data primarily because the numbers are small.

And then at ASN last October, you guys had multiple presentations, which began to talk about sort of the product's mechanism of action. What were the key learnings from ASN about the product and then as you look to the mechanism of action study update in the second half, what analyses are going to be conducted that could support or build upon what we learned at ASN?

So we had 6 posters at ASN. And thanks for coming by. And asking some great questions. We actually had a lot of interest. So before I talk about what was shown, I will say that we have a renewed focus. I talked about resetting our company. We have a renewed focus on really trying to understand the biology behind the effect that we're seeing in the clinical studies, right? And we have some hypotheses for sure on that, that we're testing this year. But we don't have that sort of aha moment just yet. We're also doing a lot of work on potency assurance because we want to make sure we get that piece of the puzzle in place for our BLA application. At ASN this year, my takeaway from the work that was done by our team was really around, we have a better idea about our product. We have a much better idea of characterizing ourselves and what makes up those cells using some more of the sophisticated tools available, primarily driven by the advances in sort of the omics that we've seen over the last few years. So what we really know about ourselves is they're primarily tubular and epithelial and origin. There are some glomerular there are some endothelial cells in the mix too, but it's primarily tubular and epithelial. What we also know is that over the course of the manufacturing process. If we look at the cells at different phases of manufacturing, what we see is a progression towards dedifferentiation. So cells that are showing less signs of inflammation, less signs of stress and younger cells over the course of that manufacturing process. And we believe those healthier cells that are more dedifferentiated may have an impact when they're injected on how they interact with the existing cells within the patient's kidney. So more to come on that. It's a focus for us. We know it's important, and we really want to be able to explain how this works.

Questions from the audience? Malcolm?

So group 1 really highlights the benefit of earlier treatment. What are the thoughts around if it's possible to shorten that 3-month period between injections. So I think what's the risk benefit there?

So I mean, I think we've been asked, like why can't you just inject both kidneys at the first time. And I think it's a reasonable question. You can imagine, though, that we wanted -- we've taken more of a conservative route. We're still -- our safety profile is still growing, like we haven't injected 1,000 patients and really have that robust safety profile just yet. So I think over time, we may get to a point where we feel more comfortable about either pulling that injection delay in closer or potentially even injecting the patient simultaneously while they're in the interventional radiology suite. Of course, we need to keep in mind the patient the time and the burden on the patient, if there's going to be 2 injections. But I think we just need to grow that safety profile first before we move down that path.