Conference Transcript - ENTA 2026-06-04

Akash Chawari, Analyst — Jefferies

Good morning, really appreciate everyone's attendance, and it's been really enjoyable seeing everyone in New York enjoying this conference. My name is Akash Chawari. I head our foreman biotech efforts on the research side for Jefferies, and we have the pleasure of hosting the Enanta Management Team, a company that is heavily embedded in small-molecule drug discovery across different disease areas, and a lot of products that I think are going to become increasingly important. Jay, why don't I hand it off to you for some intro remarks, and we'll get started.

Jay R. Luly, CEO

Thank you, Akash. Before I begin, I want to remind you that I'll be making some forward-looking statements, and for a summary of the risks associated with these statements, please see our filings on sec.gov and on our website. Okay. So where would you like to start? I mean, we can dive in on the RSV side and we can go into, yeah, start there.

Akash Chawari, Analyst — Jefferies

Let's start with, so let's start with RSV, and I want, I know right now you have some really interesting data with your N inhibitor, and the question is really how does that molecule get developed when you go into phase three? And let's start with really even powering in these trials, because this is really precedent-setting. I mean, we've never had success on the antiviral side in RSV. And then you're also a SMINCAP company, and these are sometimes large, burdensome clinical trials. So what have you learned in the field in terms of what the right trial design is for an antiviral in RSV in an adult population?

Jay R. Luly, CEO

So what we've learned, I would say it's getting to the right patient and at the right time. You're dealing with an acute respiratory virus. These viruses present, you know, we all know what COVID's like, I think by now. Everybody knows sort of what flu is like. You probably may or may not know what RSV is like, But everybody in this room, I guarantee you, has had RSV multiple times. I found out with one of those little home diagnostic test kits that I had RSV two months ago. I wasn't expecting it to light up, but it lit up. And it felt like, you know, one of many bad respiratory tract infections I've had, you know, over time. but what you want to do is make sure that you're getting to the when I said getting to the right patient I think the key is focusing in on you know who are the patients that are at highest and met need and it's the patients who do really poorly when the respiratory virus strikes so it's either the very young in the pede setting very you know old immune compromised patients who have you know CHF COPD there's a whole bunch of different risk categories but if you really want to see the most dramatic effects such as what we saw in our most recent study you need to get into that high-risk patient population to see it and you don't want to wait around for a week or to try to get a drug on board I think we know flu drugs you know typically you need a drug on board within 48 hours. I think COVID is within five days. Probably three days is better than five days for COVID. And I think that's probably the same case with RSV. So I think those are the learnings. Pick the right severe population and get there as quickly as you can. And I think the test kits are going to actually help that a great deal.

Akash Chawari, Analyst — Jefferies

Understood. Now, when we think about kind of next steps with your an inhibitor program as a monotherapy I know there's also the potential to go with a combo approach as well um what are kind of the landmarks is there a partnership opportunity available can you kind of update us on any of those discussions if there's anything that could be imminent and then number two if you're to think hey this is the cost we would need to run this clinical trial just help frame that for investors what's the size and time scope of one of these studies yeah so maybe starting with the second question first I mean the you know we are looking at you know a registration path and again our our plan is to we've been

Jay R. Luly, CEO

obviously having a lot of discussions with FDA you know post our RSV HR data set you know really to define that registration path because, you know, one doesn't exist. I think that's the good news and the bad news, right? You get to sort of map it out with the agency, you know, for the first time. You know, we're, again, and we'll give a more fulsome update on our, you know, the discussions in alignment with the agency, you know, this month. I guess we targeted Q2 and we're in the last month of Q2. so stay tuned. Clock is ticking. Yeah. Okay. Um, so, but what I think, uh, you know, ultimately, you know, it's, it's, you're, you're looking at a, uh, you know, some sort of a study design that ultimately would be, um, it's not like a vaccine study, right? So you're, you're talking about, you know, hundreds of patients. Um, you're talking about, um, a pathway to that is, you know, not everybody has explored. I think Enanta's got probably one of the best teams in the world, you know, based on having developed two drugs in RSV, having looked in a variety of different patient populations, high-risk adults, PEs, challenge studies on multiple different drugs. So I think we've got, you know, the right team in place to be able to, you know, either progress this thing in the context of a partnership or, you know, without a partner. I think under any circumstances, any company probably in the world would need to rely on the insights and experiences and stuff that the Enanti team has developed here over time. So we're exploring, you know, multiple different pathways. The key thing we want to do is make sure that we see this thing moving ahead because it's It's not often that you find yourself, you know, this virus has been kicking around for 70 years, 70 years. Nobody has been successful to get it to the stage where you have a global registration study with a mechanism that could potentially be the first in a brand-new category. And so, you know, you're talking about a market where you have, you know, on the order of 7 million outpatient visits a year just in the U.S. alone. So big unmet need. And, you know, we're just really excited to see this thing moving ahead. So we'll figure it out one way or the other. Jay, it's pretty provocative.

Akash Chawari, Analyst — Jefferies

Let's hit on this because you've had data for a while. sounds like so you're having an additional discussion with the FDA I mean this has been your study, the initial data you've published has been I think a year at this point months last fall, I mean to me, I guess biotech years but it's been a while it's been a while now it's really interesting because there is an administration that might take a more forward looking approach in terms of therapeutics, there's a lot of difficulties running clinical trials. And if you have a safe medication, this would be something where I feel like there could be a more lenient stance in terms of clinical development. I just want to make sure I understand that, because this does seem like a bit of a tone change from our prior conversations here. What is your perspective? Like, what are you trying to propose to the FDA about the clinical development path, ideally with this molecule? And are there scenarios where you could actually get a path forward where you wouldn't have to look at an external partnership, your team would be able to run the trial internally?

Jay R. Luly, CEO

Well, like I said, I think all these possibilities are on the table. You know, what we're always trying to figure out is what is the most efficient pathway? You know, that's just the nature of the business. There's no, we're no different than any other sponsor. You're always trying to figure out what's the most efficient way. And, you know, how do you align on, you know, a constructive pathway that, you know, that you can articulate and that the agency, you know, agrees with such that you can get this thing out there and done. And I think, again, we'll have more to say this month on that, but, you know, we're just excited by the prospects of getting this thing moved ahead. I mean, we've certainly, as you well know, Akash, because you've been following RSV for a lot of years, it's a seasonal thing, right? So we've been, you know, just planning for success, not only, you know, with our left hand having discussions with regulatory agencies, but also with our right hand doing everything to enable a study, you know, to get off and going even later this year. So, you know, drug supply, getting protocol figured out, those sorts of things. So we haven't taken our foot off the gas at all.

Akash Chawari, Analyst — Jefferies

And as a reminder, I think prior you've kind of expressed the idea of partnering that asset out instead of running the pastry separately, or is this something that you've always stated you wanted to go internally developed?

Jay R. Luly, CEO

I think, you know, where I would draw the line is we certainly have thought about a partner for, you know, the latest stages of this and certainly for commercialization. You know, coming into an area where it's a, you know, a new product category, you know, doing a global launch of multiple different patient populations and so forth to really maximize the opportunity. I think that's what pharmas, you know, do incredibly well. As I mentioned, we do some of the development incredibly well. So anybody out there would certainly be wanting to understand, you know, what regulatory clarity looks like and also, you know, having a right execution team to get something done. And so those are the things we've focused on.

Akash Chawari, Analyst — Jefferies

Understood. But I'll even put this more even simply. Is it fair to say that your team is markedly more excited about the opportunity of a constructive clinical trial design proposal with the FDA than, you know, I remember, you know, last year when we talked about this wasn't something that I think you were proactively bringing up. I mean, is that a fair read?

Jay R. Luly, CEO

Well, we're further down the track, right? We've had discussions, and again, so it's all taken, you know, we didn't have the data all that long ago, and we were still working up further analyses. We wanted to take the full complement of everything we had, you know, to the agency, show them all the, you know, all the signals that we found in the various readouts. And, you know, in the aggregate, I think it's an incredibly compelling story. We saw, and I can personally vouch for this, you know, symptoms in this, you know, to get, you know, to the degree of complete resolution is around three weeks in a high-risk patient population, and we cut that by a week. We had another readout, the PGIS. We saw, you know, stat-sig, two-day improvement there. Importantly, in hospitalization, you know, the attack rate for RSV in this population was about 5%, which is, you know, pretty significant. And, in fact, we had one of our placebo patients die of RSV in this study. So we cut that down in the drug treatment group. There was basically no RSV-related hospitalization, so we, you know, it's like 5% versus a very, very low percent, and we had obviously no deaths on azelicapivir-treated people, only in the placebo group. So, you know, the fact that you're getting a dramatic shortening of the time to complete symptom resolution, you're getting…

Akash Chawari, Analyst — Jefferies

Oh, it's like one or two days. I mean, that is.

Jay R. Luly, CEO

Well, it was, again, we saw a week.

Akash Chawari, Analyst — Jefferies

A symptom resolution.

Jay R. Luly, CEO

It was about a week in terms of that using the RIIQ, the patient. No, you're right. And then the hospitalization. I mean, it was we weren't necessarily expecting to see that in, you know, such a small study.

Akash Chawari, Analyst — Jefferies

But it sounds like the agency is quite important is looking at the totality of your data. that's one of the reasons I think we got more bullish on that data set too was it's not just hey you have a log drop it's like the log drop correlated with the symptom reduction which correlated so there's not one that's like randomly trending the wrong way is that there was a super high degree of alignment of a bunch of different signals all right so Jay leading up to this give me something um no but this is interesting okay so how do you do this in a capital efficient manner In my mind, I'm thinking a couple things. A, do you run a trial where you have a synthetic comparator arm? You look at historical rates of hospitalizations because it's unethical, you know, to run a trial where patients aren't getting access to drug, especially if these are elderly individuals. So you don't have to, the size of your study could dramatically decrease. You could run a study maybe for, again, you could power it for mortality. You can power it for symptoms. You can power it for symptom resolution. you can power it for viral load reduction, right? For a company that has capital constraints, as an ANDA does right now, what is the right endpoint that you feel like A, puts your drug in the best position to succeed, but then B, also allows you to run the trial efficiently?

Jay R. Luly, CEO

Well, I think they're not all mutually exclusive. I think some of the key readouts were aiming to ultimately get. But I think they, I mean, it would be wonderful if you could, you know, power for the most far-flung end point that would give you the best possible, you know, overall profile. But I think just, you know, drilling down on symptoms and hospitalization and looking at those kinds of things, you know, has the, has the potential to be a fairly manageable Hospital, okay, and so to be clear. Well, we're going to be getting, we're going to be looking at hospitalization, you know, It's going to be, yeah.

Akash Chawari, Analyst — Jefferies

So, Jay, maybe just to put a final point, because I couldn't agree with you more. Even your prior point is like, look, everything has to trend in the right direction. There needs to be consistency of the data. That makes sense. But, like, I'll give you an example. Like, we, you know, we cover Ionis and pancreatitis events, right? There's not that many pancreatitis events, but even a few, you show a trend, whether it's Statsig or not. The point is, like, well, the agency can say, like, whether it's Statsig or not, there's like 10 events on one arm. There's no events on the other arm. We've seen enough to say, hey, there's a signal here. I can't help but think, forget Statsig or not, but just directionally hazard ratio. If it was on hospitalization, you mentioned a 5% kind of underlying attack rate. So if you were to say, and to more explicitly, like let's say that you had an endpoint where it was more a hazard ratio on hospitalization versus symptom improvement, which again has traditionally been used and there's always gonna be a larger end required there. So are you going to the agency and saying like, look, we wanna just, are drugs gonna be safe?

Jay R. Luly, CEO

We're gonna show the trends on the symptoms, but you know we think we're going to see de minimis hospitalizations with our drug and there's going to be an underlying rate and that's really our primary endpoint is that the approach you're going to take here on or our hospitalization sorry yeah i i probably can't get out in front of our you know planned discussion on this uh this month um but all of those things are you know very very much on our mind we've even done a lot of testing with payers on you know different profiles and what that could look like what kinds of data would be you know important in the minds of payers and also physicians that we've done a lot of market research here we We built that into our thinking and into our proposals for endpoints to the agency. But that's about what I can say today.

Akash Chawari, Analyst — Jefferies

I'm still going to keep trying. But on hospitalization, is the sense that you would need something statistically significant or an obvious trend, right? Like there's nuance between the two. How should we think about, you know, a strong trend on a hard endpoint for a smaller study, but it just becomes, you know, compelling? Is that the way we could think about it? It doesn't have to be stat-sig, but it has to be a strong trend?

Jay R. Luly, CEO

Yeah, I think that's probably not unreasonable. And, again, we saw a pretty strong trend even in a, you know, a smaller study.

Akash Chawari, Analyst — Jefferies

And can you remind us, in terms of hospitalization rates with your drug and then the placebo arm, what was the trend that we saw?

Jay R. Luly, CEO

So it's 5% placebo, and effectively, I think all-cause hospitalization was 1.7%. And the adjudicated RSV-related hospitalizations was 0%.

Akash Chawari, Analyst — Jefferies

Right. Interesting. Now, how does that maybe change trial design size? If we're thinking about a more stringent, I mean, to your point, there's nothing more important than hospitalizations and deaths. I mean, these are really clinically relevant. When you think about traditional phase three studies in RSV versus, let's say, something where you can pick a trend on an incredibly important endpoint, are we talking about half the size? Are we talking about the same size? How do you power that study correctly? there are no precedents sure right so and this is where we're going in and you know statisticians have spent a lot of time focused on that so let us let us make the public disclosure okay granularity um maybe just lastly on this because you said you know we had our data last year and then we've had it sounds like you've already had some preliminary discussions with the agency um talk to me i mean obviously um like we've seen paradigm changers in virology i mean sidara i think is an important idea where this idea of like instead of a traditional vaccine you have a therapeutic which can kind of protect patients from flu and there could be an expedited clinical development path that i think has been alluded to let's see if that actually plays out When you think about the agency's view of antivirals for respiratory infections, and particularly under this administration, do you feel like there has been a more constructive stance than what you've seen historically?

Jay R. Luly, CEO

I'd say we've seen a very constructive stance for multiple years. You know, we've had lots of interactions over time, fast-track designation, and it's been pretty even keel.

Akash Chawari, Analyst — Jefferies

Pretty even keel. And then maybe just lastly, in terms of viral load reduction versus, let's say, a symptom endpoint, you know, you showed, to your credit, a trend on both. Is there one that you feel like, and especially in a larger global study, it might be a little more difficult? Is it symptoms? Is it, you know, absolute log reduction? If you were to have to pick another endpoint that you would think about for phase three, which one's preferable?

Jay R. Luly, CEO

Yeah, so virology, I shouldn't let Tara talk once in a while. She's actually a virologist. I think virology generally in acute indications, we saw it in COVID also. So the agency, you know, puts less emphasis on virology. You know, it's interesting. There were certain COVID drugs approved that didn't show anything on virology. They had.

Akash Chawari, Analyst — Jefferies

That is true.

Jay R. Luly, CEO

And you can only measure virology in your nose, right? So which is not necessarily where all the action is. And so it's interesting. It's supportive.

Akash Chawari, Analyst — Jefferies

Symptom resolution.

Jay R. Luly, CEO

It's always good to see. But they're looking for other things. Right.

Akash Chawari, Analyst — Jefferies

Understood. Moving on from that topic, but still in RSV, obviously you have your L inhibitor as well. And again, you think about, you know, could the agency take a more constructive approach here? I don't understand why you have to now go run a phase 2B, you know, with the L inhibitor. Like, if the drug's safe, you've done your challenge study, and you have enough human data, why not, you know, take a combination approach in a phase 3, put these drugs in kind of the best position to succeed um i mean should we be thinking about potentially an accelerated path um with the l inhibitor um in terms of getting that into a phase three and especially when you're thinking about it maybe as a combination add-on yeah you still you still ultimately need i think to show something in a real world setting or you know challenge studies are great.

Jay R. Luly, CEO

Yeah. They're an incredibly powerful tool to help you, you know, pick dose and show that you've got an antiviral, show that you can, you know, reduce symptoms. You know, it's incredible. But there are certain practical limitations. You know, the way the studies are set up, it's not perfectly real world. Yeah. So I think you probably need at least something in the real world setting before you would jump in to say that you've demonstrated that in a certain patient population, you've got some sort of activity as opposed to healthy volunteers who you've infected. Also, but to follow up on that, I think most patients probably will do okay with one of our drugs. I think there are patient populations out there, you can think of the severe immune compromised patients who potentially could benefit from a combo you know hit it hit the virus orthogonally two different directions two different correct acting antivirals hammer it or maybe you know potentially coming in a little bit later in the infection but with two drugs hammer it right for like traditional adults yeah okay but so those are different ways that you can think about leveraging three two three but the other way is you know get zellie to market establish the market be the first to market and build that and then life cycle management you know you can be coming through with something three to three like that all three to three that would you know push it out even further meanwhile you have the options of combinations and we also saw in our challenged data but it's compelling post-exposure prophylaxis that the data were actually very strong for that doesn't surprise me maybe just last point on this but why not, I can't help but think when you're running a human in a symptomatic patient population couldn't there be two arms, one arm with an L inhibitor and then one arm with a combination of an L

Akash Chawari, Analyst — Jefferies

you know both of those drugs given that you already have kind of established safety I mean is that is that possible that we can have the combination as early as you know once you get this the challenge that data in-house and you're going to now run a symptomatic population you can already go with the combo then well such a trial design could be contemplated in fact I think you you would need almost that comparison to convince yourself that you're adding any benefit because you have to be able to show utility and combination studies that the second one is doing something. Can I push back on that? I just don't get it because to me, and this is like an issue I think you even dealt with, which is like, okay, I set my first population in healthy volunteers and then otherwise healthy RSV patients, and maybe that's not the patient population. But in general, you want to hammer these viruses as much as possible to prevent, you know, like an early study is not going to do that, right? So if you were to say, right, because even how would you even know in, let's say, a regular adult RSV population whether the combo would be better or not? You would have to run an immunocompromised trial, which is going to take forever to enroll, right? So what would you even learn if, let's say, there's not a delta between the two arms in a, you know, RSV adult population?

Jay R. Luly, CEO

Yeah. Again, you have to show benefit. I think that's one of the rules. You know, we saw it in hepatitis C. When V-Cura launched, it was three direct-impacting antivirals. Each one had to play a role in that, show some benefits. And then we came up with Maveritt, with AbbVie, two-drug combo. You had to – I mean, there's no question that the two were powerful. But, again, I come back to much as I want to maximize both assets. You like the – I mean, you're – We also think that the majority of the patient population, we should be able, in an acute infection like RSV, one could be enough for most patients.

Akash Chawari, Analyst — Jefferies

Running out of time, I want to hit on the STAT6 inhibitor. And I think this idea of degrader versus inhibitor, but I think there's even within the inhibitor realm, a bifurcation between allosteric and orthosteric approaches. and I think there might be a view like, hey, you know, orthosteric might actually be better than allosteric and we're not actually getting the same PK. Can you comment a bit on when you think about allosteric inhibitors themselves, is an antizrug an allosteric inhibitor? And then B, this idea that you can get complete target engagement with going with that approach, would you agree or disagree with that?

Jay R. Luly, CEO

I think you can get complete inhibition with all of the above it just takes the right molecule and so you know when we think about it you know if you go back I mean I was working on jacks and stats in the early 90s and a different company back then but they were difficult to drug targets in the stat field so it made perfect sense I think at the beginning of STAT-6 work after, you know, failure in drug targeting to come up with a degrader approach when it's difficult to drug target. But that's no longer the case, right? So now that you can drug it, you know, our attitude is why use a degrader if you don't have to? I mean, if you can get complete inhibition with a well-behaved, potent, small molecule that has good small molecule attributes. You know, you've seen us make a lot of these things in the past. And then whether it's salosteric or orthosteric, I think at the end of the day, it doesn't matter, especially you can prove so much of this stuff preclinically. We've shown dupy-like activity with an inhibitor, not only in atopic dermatitis models, but also, um, asthma. Um, so you don't, I think it all boils down to the, uh, the specific molecule.

Akash Chawari, Analyst — Jefferies

There's lots of my, just, uh, I know we're running out of time, but I want to sneak into this question. There's this idea though, like if you can target intracellular, like you deal with receptor recycling and turnover and, um, you know, presentation in the cell surface. And sometimes that dynamic can happen when you're looking about an inhibitor, but sometimes if you can target intracellularly like one of the things i've noticed for example about the chimera drug is that it works at very low doses right um what's the nature of the mechanism yeah exactly no i agree um how do you think about dose response on an inhibitor approach because again like there's a different i think there's probably a different dynamic there you know it's it's no different than anything else i mean you want to have good coverage for the target you want to be able to knock it down um question you know that a lot of people had is can you knock it down over a 24-hour period continuously even though drug the answer is and and you know this from our virology experience we're used to leaning on viruses hard yeah above you know the you know the ice you know the ec50 or ic90 or whatever we're looking at you just need to have drug levels above that as long as you have continuous drug levels with good pk um you're going to be fine um i keep saying last question but this is the last question um plasma protein binate adjusted at the site of you know the lesion um do you feel like you're going to be able to get to depiction like i mean we're talking about ic99s right i mean that's very hard with a small molecule drug um but we've done it in animal models already okay so you feel comfortable in terms of drug distribution and plasma it's already done it okay on that note this is one of our best ones um thank you so much I really do appreciate it. This is a great conversation. Thanks.