Sionna Therapeutics, Inc. (SION) Earnings Call Transcript & Summary

Good morning, and welcome to the Sionna Therapeutics Conference Call. [Operator Instructions] Please note that this event is being recorded. I will now turn the call over to Juliet Labadorf, Senior Director of Investor Relations. Juliet, you may now begin.

Thank you. Good morning, and welcome to today's conference call. Joining me are Mike Cloonan, our President and Chief Executive Officer; and Charlotte McKee, our Chief Medical Officer. Also joining us for the Q&A session is Elena Ridloff, our Chief Financial Officer. Following our prepared remarks, we will open the call to questions. Before we begin, I would like to remind you that today's discussion will include forward-looking statements about our future expectations, plans and prospects. These statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected. A description of these risks can be found in our most recent 10-Q filed with the SEC as well as any subsequent SEC filings. Any forward-looking statements speak only as of today's date, and we assume no obligation to update any forward-looking statements made on today's call. With that, I will turn the call over to Mike Cloonan, our CEO.

Thanks, Juliet, and good morning, everyone. Thank you for joining us. Today, we are announcing top line data from 2 clinical programs, our PreciSION CF Phase IIa proof-of-concept trial of SION-719 added to TRIKAFTA and our Phase I trial of SION-451-based proprietary dual combinations. Before we discuss the results, I would like to thank the people who participated in these studies, their families and all those involved in executing the trial. I also want to recognize the Sionna team for their incredible dedication, focus and commitment. We are deeply disappointed to announce that the PreciSION CF Phase IIa trial did not meet its key activity endpoint as measured by change in sweat chloride. Given these data, we are not continuing development of 719 as an add-on to standard of care. The Phase I dual combination trial evaluating 451 in combination with 2222 and 109 achieved its safety, tolerability and PK objectives, including exceeding target exposure that we had determined prior to the PreciSION CF outcome. We are actively analyzing the Phase IIa data and our translational framework to help assess the potential profile and next steps for 451 plus 2222 dual combination. We will be data-driven and disciplined, including taking actions to preserve capital. Charlotte will now walk us through the results, and I will return to discuss our next steps. After that, we will open the call for Q&A.

Thank you, Mike. I have spent many years committed to developing medicines to help improve the lives of people with CF, and I am deeply and personally disappointed in today's announcement. Now we'll look at the data. Turning to Slide 5. The PreciSION CF Phase IIa proof-of-concept trial evaluated a 30-milligram twice daily dose of 719 when added to TRIKAFTA. This was a randomized, double-blind, placebo-controlled crossover trial in adults with CF who are homozygous for F508del on a stable dose of physician-prescribed TRIKAFTA. After screening and a 14-day TRIKAFTA run-in, participants received 14 days of 719 plus TRIKAFTA and 14 days of placebo plus TRIKAFTA in random order with a 28-day washout between treatment periods. The crossover design enabled us to compare changes from baseline during the active and placebo period in the same participants. The primary endpoint was safety and tolerability. Secondary endpoints included pharmacokinetics and change in sweat chloride, which is an important biomarker of CFTR function. We powered the trial for a sweat chloride improvement of at least 10 millimole per liter, a threshold we believe represents clinically meaningful benefit based on an in-depth analysis of the literature and thought leader and community feedback. On Slide 6, we summarize baseline and demographic characteristics. The trial enrolled 15 participants, all homozygous for the F508del mutation and stable on TRIKAFTA for at least 3 months before screening. Baseline sweat chloride and other demographic characteristics were consistent with the population we intended to study. Adults with CF who had a typical response to standard of care, but still had room for improvement in CFTR function. Turning to Slide 7. I'll start with the top line results. When 719 was added to background TRIKAFTA, we observed a mean placebo-adjusted sweat chloride change of minus 1 millimole per liter with a p-value of 0.7. This was below the threshold we had defined as clinically meaningful. It was not statistically significant, and it did not demonstrate the level of additional CFTR functional improvement we expected. When added to TRIKAFTA for 14 days, 719 was generally well tolerated. 719 exposure was consistent with data from the Phase I trial of 719 alone in healthy volunteers and mean TRIKAFTA exposures were consistent with published data. We observed potential trial confounders, including higher-than-expected variability in individual sweat chloride levels and differences in TRIKAFTA exposure levels between the 719 and placebo periods at the individual participant level. We are actively assessing these variables. We do not believe our findings will change the outcome of the PRECISION CF study, but we believe it's important to understand them fully to inform our translational framework and potential next steps for the 451 dual combination. Turning to safety on Slide 8. 719 was generally well tolerated when added to TRIKAFTA. Most treatment-emergent adverse events were mild to moderate. There were no serious adverse events and no clinically meaningful trends in adverse events overall, including no trends in liver function events. We observed Grade 3 liver function test increased at the start of the 719 treatment period before dosing, which resolved before the end of treatment. One patient discontinued treatment unrelated to an adverse event. We continue to analyze the Precision CF data, including potential trends and correlations to better understand what contributed to the outcome. Taken together, however, the results do not support advancing 719 as an add-on to standard of care. I will now turn to top line results from the 451 Phase I healthy volunteer dual combination trial. On Slide 10, we evaluated the safety, tolerability and PK profile a different dose combinations of 451 with the 2 complementary modulators 2222 and 109. Dual combinations were studied in randomized, double-blind, placebo-controlled 14-day dosing cohorts with participants randomized 3:1 active versus placebo. Most cohorts were dosed in the fasted state with 1 Fed cohort dose in each dual combination arm. 120 participants were dosed across 10 dual combination cohorts with 60 participants in 5 cohorts in each combination arm. We identified combinations of both 451 plus 2222 and 451 plus 109 that were generally well tolerated and achieved the targeted PK exposures set before the PreciSION CF data readout. So the study met its safety, tolerability and PK goal. Based on the totality of the data and target coverage observed, 451 plus 2222 was identified as the preferred dual combination. Exposures of both drugs in the combination were similar to what was observed in trials of each drug studied alone. On Slide 11, are further details of the safety and tolerability profile of 451 plus 2222. One of our goals in this trial was to explore dose ranges to probe the safety and tolerability and and potential efficacy of our dual combinations and to optimize exposure at well-tolerated doses. In our dose exploration, we evaluated both once-daily and twice-daily doses of 2222. The twice-a-day regimen had not been previously explored in clinical development. We identified 451 BID and 2222 QD as our preferred combination and regimen based on its favorable tolerability profile and exposure in this Phase I trial. All 451 cohorts with 2222 dose 1 today were generally well tolerated, with all treatment-emergent adverse events mild to moderate in severity. There were no serious adverse events and no treatment-emergent events related to elevated liver function tests. One participant discontinued dosing due to a moderate rash. When 2222 was dosed twice a day in combination with 451, 2 participants discontinued dosing due to dose-limiting events of increases in liver function tests and flu-like symptoms. Both cases were confounded by other factors, including potential infection. All events were transient and resolved without sequelae, and there were no additional liver-related findings such as increases in bilirubin. I will now hand things back to Mike for concluding remarks.

Thanks, Charlotte. As a reminder, at the end of the second quarter, we had approximately $268 million in cash. We are currently undertaking actions to preserve capital. I want to close by acknowledging that this is not the outcome that the CF community, our investigators, our shareholders or our team wanted to see. We built these programs around a compelling scientific hypothesis and a meaningful goal to improve CFTR function for people living with CF who still need better options. That is what makes the results of the PreciSION CF study so difficult. We are interrogating the results of PreciSION CF to assess the potential profile and next steps for the 451 and 2222 dual combination. We will be disciplined and data-driven as we make decisions on the best path forward. and we anticipate providing further insight in the near term. Clinical research only happens because people are willing to participate, partner and believe in the possibility of progress. We are incredibly grateful for that trust. Thank you all for joining us today. I will now ask the operator to open the call for questions.

[Operator Instructions] Our first question comes from the line of Paul Matteis with Stifel.

Can you maybe quantify a little bit more the changes in TRIKAFTA that you saw? Like is that -- were those down or I guess, decreases in TRIKAFTA big enough to explain what happened here? And then maybe just beyond that, like what are the 2 to 3 working hypotheses that Sionna team has right now? And when do you expect to sort of, I guess, have a conclusion and a conclusion around what the path forward is, if any, with NBD1?

Thank you, Paul. This is Charlotte. I'll answer the first question, and then I'll turn it over -- turn the second part over to Mike. So as we -- as I mentioned and we announced there was a noticeable and observable decrease in TRIKAFTA levels when patients were dosed with the 719 period compared to the placebo period. And we -- it is possible that it was of a magnitude that was large enough to have impacted the potential treatment effect. We're still doing a lot of exposure response work, and we'll be diving into that much more deeply. I will just say, based on the patterns and the individual profiles it does that impact does not appear to be driven primarily or all by [ CYP3A4 ] induction. So there was some possible other more complex interactions, but it is real and observable and could potentially have impacted the outcome.

Yes. Paul, I'll take the second part. So you asked the 2 to 3 things that the hypothesis. And I think Charlotte mentioned a lot of them, right? You should just talk through so that TRIKAFTA. We can't say, yes, right, what impact that has had. We're evaluating the patient-to-patient impact. But with that, one thing we're really trying to evaluate is there something inherent in this stuff, right? And adding on top of TRIKAFTA to their drive differences that we didn't expect in that response is one of them. They were also sweat for durations that Charlotte talked about prior and we're looking at that as well. And the -- we had such a wide range of response here in terms of the sweat core outcomes. And so we really have to dig into exposure response, as Charlotte said. So we have to do a deep, deep interrogation of this because one of the things we also want to make sure we can do is learned from the data that we do have, how the translational model should be adjusted to help us be more precise, right? Because there clearly was a difference than what we assumed coming out of our [indiscernible], we built it around a 10 millimole core improvement, and we obviously didn't deliver that. So we need to do all of this work to really help assess what the path and the potential is for the dual combination moving forward. So that's probably the hypothesis we have right now.

Our next question comes from the line of Yatin Suneja with Guggenheim.

Maybe just high-level question. I mean how should we think about the assay that you have used? Any sort of thought on the assay and sort of the predictability of that does these data change your view? Maybe if you can compare and contrast the biology versus the assay? And how should we think about sort of the next step? Like what sort of decision you need to make before you sort of decide the dual combo?

Yes. Thanks, John. It's Mike. I'll take that one and obviously, Charlotte can chime in, too. But so as I was mentioning to Paul's question, that is absolutely clearly something we have to look at as the translation here. And what we can learn. As I said, we have a degree of confidence that we were going to achieve at least that 10 millimoles based on our assay predictions. We achieved the 719 PK and the exposures that we've set ahead of time in the study itself. And obviously, we didn't see that level of translation in the study itself. So we need to go deep into the data now. We've got patients that we can evaluate that completed the study. We have to look deeply at each patient's response, what exposure they achieved and really try to map back to the assay around what tweaks we can make or learnings we have to improve that production. And that is absolutely critical, as I said, to help inform the decision that we have to make on 451 and 2222 and its path forward. With that dual combination, as Charlotte mentioned, the Phase I study achieved the safety, tolerability and PK profile that we had set out ahead of the PreciSION CF study. and it enabled us to select 451 plus 2222 as the preferred combination but we really want to take the time and pause now with this data in hand to really make sure we deeply interrogated to help inform our assay assumptions and what the path forward for the dual combination is.

Maybe I would -- this is Charlotte. I would just add, really, I would just double click on this exposure response and target engagement question. It's really what we're probe very, very deeply in these data because as you know, and we've all discussed there's a wealth of literature, scientific literature, biology from multiple labs around the world and including our data, demonstrating the biology and potential for NBD1 modulation. And so really, our question is a question about target engagement and exposure response and how we need to potentially modify that set of predictions.

Our next question comes from the line of Ritu Baral with TD Cowen.

And thanks for the clarity and insight here this morning. A couple of questions. One is basically Paul's question but applied to the sweat chloride. And basically any insight on into the increased variability there seen. Obviously, it's notoriously variable -- measure in individual patients per the KOLs? And is there any insight in how to control that potentially for the 451 data? And if I could sneak a second one in here. given Charlotte, your discussion of exposure response, right, as you were thinking of the doses of 719 used the potency and the exposure limitations, the admin limitations of that drug? And what you intend to use for 451 going forward, is there a multiple pharmacokinetically a multiple of activity that you guys have estimated for what could be -- the increased activity at NBD1 in the trials going forward with 451.

Yes. So your first question was about the sweat chloride variability. So I just want to be maybe clear that definitely with something we observed was more variability that variability alone in the sweat chloride, we do not believe drove the outcome or the results from the study. It does make it more difficult with this variability to tease through the underlying exposure response and identify what might be a lower than predicted treatment effect. And so that is where -- fortunately, there are some statistical tools we can use, and we have been bringing those to bear. The variability is just -- it adds more noise the system. So it just makes it harder -- a little bit harder for us to see through and identify clear patterns, but that is still possible to do. And obviously, as we -- if there are any -- for any potential trials in the future, we would take that into account. But that was not that doesn't change the outcome of the study, and that was not the critical factor. We do believe it was the magnitude of treatment effect and really the exposure response that was the critical factor here. And I'll just -- I'll start with your second question. Again, we're continuing to evaluate the translational framework and to determine what the impact and potential next steps would be, as we said, for the 451-2222 combination, it's really too early at this point to be hypothesizing about magnitude or fold changes we would be thinking about those things as we consider the next steps.

Yes. Maybe just -- I'm sure people picked up on this is we did announce today that the dose we did use in the 719 study was 30 milligrams. We always referred to the lower dose range. We disclosed that we use the 30 milligrams and just to build us Charlotte's point in the Phase I healthy volunteer study of the duals, we use similar doses that we've used previously in the Phase I, right? So there's -- you can see some relationship there that we have ability to have a higher dose, clearly with 451 versus the 30. But as Charlotte said, we need to do more work, right, to confirm some of the assumptions that we have on the dual and ensure that fulfill is competitive.

Our next question comes from the line of Salveen Richter with Goldman Sachs.

I'm sorry to see the data as well. Perhaps just in the context of the confounding factors here, the translational aspect, the PK exposure of the DDIs, walk us through the scenarios for the Ford here, like what your in the context of what you could learn. And if there is the case here where the assays truly are not translating, what that means for and just kind of the forward of the portfolio?

Salveen, I'll start that. This is Charlotte and then I'll turn it over to Mike as well. Maybe just -- you asked about what we might learn that might inform what we're -- what we might do in the future. Just as an example, as Mike said, we have these 14 participants, and we are fortunate to have both placebo and active drug treatment periods for all of those all of those 14 patients. So it does allow us to try to, again, tea through potential exposure responses as well as confounding variables. But as we mentioned, the differential exposures of TRIKAFTA in the treatment period is something we're paying a lot of attention to, there also were individual instances, isolated instances where it has -- it really appears from the exposure and other data that there was -- there were some irregularities in background standard of care compliance. Again, they appear to be isolated instances. But those in a study that -- where there are 14 individuals, those can be informative. And so as you might expect, there are some boom statistical tools and some post-talk and ad hoc, ways of looking at the data, looking with or without outliers, for example, in ways that are both rigorous clinically and statistically that will be deeply investigating.