Zenith Epigenetics October 17, 2017 – Transcript

Webcast: https://www.veracast.com/webcasts/bio/investorforum2017/14213429507.cfm?0.03406042145

(Slide 1)

The next presenting company will be Zenith Epigenetics.  Presenting will be Donald McCaffrey, the President and CEO.

Thank you very much and welcome ladies and gentlemen and all of those on the web cast as well.  I’m looking forward to presenting some very interesting data.  We may be new to many people, but we have some first-time-ever interesting clinical data to show you today.

(Slide 2) So today’s agenda for Zenith Capital Corp. will be going through our corporate profile and structure, our epigenetic mechanism, our prostate cancer rationale, our Phase I findings, and some Phase Ib details and early results, and then I’ll touch on some of our next steps.

So on slide 3, it’s just a share structure profile.  As you can see we are a spin-out from Resverlogix.  Resverlogix is the most advanced BET bromodomain company in the clinic.  And we are a private company still, a fully reporting issuer.  To date we’ve raised $44 million dollars U.S., and all of that was at $1 per share U.S., and all of it was pre-clinical results.  The enterprise value of the company currently is somewhere between $350 and $375 (million U.S.).  And outstanding shares are about 1.25 million.  We will be adding 10 million to that shortly as private financings are being done imminently.  Our burn rate is about $2 million per quarter.

So on slide 4; on July 31st, 2016, we did a corporate restructure, where we split out the company a little bit, and the shareholders of Zenith own Zenith Capital Corporation, which holds the royalty preferred rights to the Resverlogix Phase III asset, but it also owns a subsidiary company, Zenith Epigenetics, where we are doing our clinical work right now.

Slide 5 (outline)

So let’s go to slide 6 - the epigenetic mechanism and the approach that we’re using.  Now we are one of the newer types of epigenetics.  So think of genetics as your DNA, your hardware - your computer.  Epigenetics is the software; it’s turning the genes on or off.  There are three different approaches to that: writers, erasers, and readers.  Writers and erasers are adding a chemical entity onto or off of the end of the histone tail, whereas the reader approach, which we are, is a protein-to-protein interaction, affecting pathways, etc.  And it has proven to be very effective.

Now on slide 7, the Zenith approach.  We are targeting resistance mechanisms.  Whether you’re utilizing signaling inhibitors, hormone deprivation therapies, antibody-based therapies or chemotherapies, [for cancer treatment] their escape mechanisms seem to be the same, and that happens to be bromodomain 4, which cluster in super-enhancer sites.  This is work done by Rick Young’s lab at Harvard, showing that these clusters of BRD-4 attract oncogenes.  So if you target a single oncogene, it mutates to another pathway. And by inhibiting the BET bromodomains, as depicted in the box on the upper right, you stop that escape mechanism from happening.  (From slide: Treatment with BETi resensitizes cancers to these therapies.)

Slide 8 (outline)

So let’s talk about our rationale for prostate cancer on slide 9.  There are some pretty good drugs out there for prostate cancer right now.  Abiraterone and Enzalutamide have both helped a lot in the field.  Between them they do about six billion dollars in sales right now.  However, the downside is that the pathway becomes resistant after about two years.  So it can add two years, which is very helpful, but beyond that, there is no product.  We happen to work downstream of their resistance mechanism where they get an androgen receptor V7 splice variant.  And we believe we’re in the right space here.  As you can see in the bottom chart on the right hand side, in this cell model, the Enzalutamide works very well on its own, but in combination with our drug Zen-3694, it works even better.  And our human data I think is proving that out, we’ll soon know.

So slide 10 is just talking about the market itself, the prostate cancer market.  And it’s a big one. In metastatic castration resistant prostate cancer it’s $5-6 billion per year with the two lead drugs.  The bad news, as I mentioned earlier, is that they usually only last about two years.  It’s our goal to make them work better, and it’s also our goal to extend the length of time before any resistance.

Now on slide 10 [sic, actually 11] this is just depicting the profile of the drug itself, the preclinical profile.  It’s a very easy drug to work with, and we’re seeing very clean toxicology, probably due to the facts - a lot of our facts here.  The PK (presumably pharmacokinetic) profiles are very good. (Facts include MW<500; FRET BRD4 (1) IC50 <25nM; C-Myc IC50 50 20x selectivity for BET proteins; Protein kinase panel – limited cross-reactivity at 10µM; hERG Ion channels (Ca, Na) - >100 uM; Pharmacodynamics, efficacy, tolerability – target modulation and robust efficacy at well-tolerated doses, on target toxicity profile.)

Slide 12 – (outline)

Now let’s go to our Phase I findings.  Now for Phase I, the principle investigators, we’re very pleased to have the group of people that we have.  Two main ones I’d like to highlight are Eric Small from UCSF (University of California – San Francisco) and Howard Scher from MSKCC (Memorial Sloan Kettering Cancer Center).  Between these two gentlemen, they’re responsible for four of the last five prostate cancer drugs to make the market, including Abiraterone and Enzalutamide.  So we’re very pleased to have them involved with our program.  And they’ve been fantastic, great enrollers, and we keep moving this forward.

Now on slide #14, this just gives a little bit of history about our trial.  We started our first trial in 2016.  And this is a stand-alone, so as soon as the patients had become resistant to either Enzalutamide or Abiraterone, they were put on our drug.  And we’re now advanced to a follow-on trial, where it’s in combination with Enzalutamide or Abiraterone.  But in Phase I, we were able to learn the maximum tolerated dose.  We learned dose-proportional pharmacokinetics.  We’ve learned we have a good safety profile; prolonged dosing without interruption or reduction is feasible.  And target modulation was shown below the maximum tolerated dose.  (Not said, but per slide: Some single agent anti-tumor activity/disease stabilization was observed in multiple patients.)  So this trial is now wrapped up, and we’re doing the study (fully enrolled and dosed per slide).  Close-out is ongoing.

Here on slide 15 is one of my favorite slides from this.  This is a particular patient.  This patient was probably the most successful in the early Phase I, stand-alone drug. And it is designed to be a combo drug, so this was really nice to see.  This patient had been on Provenge, and was on Enzalutamide for just about two years, a little short of two years, which is average; and then switched to Abiraterone and was only on that for about three months.  And was able to stay on our drug without any node increase for nine or ten months here, 45 weeks as you can see in the picture there, very stable.  He did advance eventually, but we were very pleased to see this after he had been on the other drugs for shorter periods of time.

Slide 16 – (outline, skipped)

Now let’s go to slide # 17; this is one of my favorites.  This is Phase I B, some of the early results.  So on 17, what you’re looking at is the blue bars on the bottom are a depiction of our lowest dose, in combination with Enzalutamide.  So as you can say one of those patients is going very very well, long past the point in time when they normally would have had to stop Enzalutamide or Abirotarone on their own.  And this is on the lowest dose and the patients are still ongoing, so we’re very happy with that.  One patient did progress radiographically on the very bottom. One patient was switched to chemotherapy by his doctor’s request, and one patient just withdrew.  So - my favorite part of this is the green bars.  This is ongoing data, very solid data, where our patients are out to about 30 weeks now, and past the standard-of-care line, and well on the way to our self-imposed target line, which we keep them on after that.  You’ll notice two more green lines at the top.  There are actually three new patients that have been added at this dose, so our end value will be even better.  And the gray bars depict our highest dose, which is going well.  

But let’s go back to the mid dose here now, and let’s move on to slide # 18, and look at their PSA response.  So as you can see, this is why these are my favorite couple of slides.  Because not only are those three bars moving along very nicely at 30 weeks, but their PSA levels are all below one.  One of them is down to zero.  So we’re excited about this.

We flip back to slide 17 for a second, you can see why I can imagine the target line is well within sight for these, and we hope they keep going long after.

Now the good news is, these patients, on slide 18 if you look at the green vertical line, that’s basically where they’re starting to show resistance, and as soon as they start, we keep them on Enzalutamide or Abiratarone and move them forward.  This means that for those drug companies, their patients can now stay on their drug much longer than two years, is our belief.  So it’s a pretty exciting market, at 6 billion dollars in sales being the up-side.  The down side being they only have two years.  Now we think we can improve that status.

And on slide 19, I’d like to just show some of the combination work we’ve done with Enzalutamide, and that we’re seeing target modification as you see on the graph on the right hand side in five different in-house targets that we like to look at.  So we’re seeing exactly what we would have expected to see.  So the combination of the two drugs has a very powerful impact.  (Bullets: Dose escalation progressing, dose proportional exposure, target modulation shown at well tolerated doses, combination well tolerated.  Y-axis is fold change mRNA.  Not clear what the three sets of colored bars represent.)

Slide 20 – (outline, skipped)

And next steps … I’ll just touch on this briefly on slide 21.  BET inhibitors have potential in combination for lots of different targets, whether it’s melanoma, lymphoma, AML, lung cancer, prostate cancer, or breast cancer.  There have been publications in every one of these areas showing why the combination with existing drugs should prove effective.

On slide 22, just some in-house work, where the synergy line there is where the drugs listed below in the various colors work on their average.  Synergistically, {sic] every one of those works better or equal in combination with Zen-3694.  So these are all potential target areas we will look at.

And on Slide 23, this is a triple negative breast cancer model, where you can see on the right hand side,  that the drug in combination with drugs like Paclitaxel works exceptionally well.  Paclitael on its own, 52%; Paclitaxel in combination with Zen-3694, 101%.  (Measurement is TGI, presumably tumor growth inhibition.)  So we’re very pleased.  In breast cancer, we’d probably start with ER positive breast cancer; our data in that area is actually even better.

And on that note, I would like to thank you very much for your attention today.  We look forward to moving this drug forward.  The date we’ve seen to date, especially our mid-dose level and the matching low PSA scores is very promising.  We’re quite excited.  Thank you very much.  Take care.