Enanta Pharmaceuticals Inc (ENTA) September 15, 2026 Conference Transcript

Welcome back. Good afternoon, everyone. I'm Brian Scorney. I'm one of Baird's Senior Biotech Analysts. With me for the next Q&A is an Antipharmaceuticals. This is a company I've covered a very long time, Richie. We've known each other for years and years before even my Baird time. They have a number of programs. Historically, they've been doing a lot in liver, virology, and now they have an emerging INI pipeline, so we'll get to all of that. But maybe just to start, Jay, if you could just give us a little bit of an overview of kind of what the company is focused on right now and what the core competencies you see the team having.

Sure. Before I begin, I want to remind you 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. So, yeah, in terms of Enanta, core competencies have always been in drug discovery and development and discovering the drugs we develop, ultimately. So our entire pipeline is filled with homegrown assets and wholly owned assets, except for, I would say, the hepatitis space. So as you pointed out, we started out in virology and more particularly liver virology, and then we moved not out of that, but beyond that. So we still have, you know, obviously the hepatitis C stuff that have these cells as in the form of maverick, which gives us good royalty revenue. But we moved beyond liver virology and got into respiratory virology before the pandemic, and shows RSV is one of the, you know, major, major unmet needs and pretty much all of virology in terms of its sort of universal And so we took that on as a problem. The pandemic broke out. We got involved in that. But increasingly, after liver virology and respiratory virology, we had a harder and harder time finding interesting things to really sink our teeth in and build the company on. And so we picked up on some of the adjacencies in the company from people who had trained, many of our virologists actually trained in immunology and became virologists later. And so, you know, given some of the skill set overlaps, it was sort of an easy, you know, migration into that area. So we took that on. And my background, I worked in immunology for a couple of decades probably earlier in my career. So kind of coming back and going down even JAK-STAT pathways were things I worked on several decades ago. And now that some of these things are more druggable, and we'll get into that, there's just lots of interesting opportunities. So we view the I&I space as sort of an expanding universe of opportunities and, you know, and again, building on our strength in virology. So that's kind of where we were and how we got here.

Great. So maybe we'll start and stick with virology before moving to I&I. Your lead asset in your pipeline is Zella-Capavir. We've seen a number of studies with Zellie across Pete's patients, across higher-risk patients, across just seasonal patients. You know, now I think the Lotus study is taking advantage of the RSVCs in there as a Phase IIb study, hoping to inform maybe Phase III design. I guess kind of walk us through the clinical history of Zellie, where we're at right now, you know, What we're sort of looking at in the LOTUS study to move forward, and what sort of informed the design there?

Yep. So, zelicampivir is a replication inhibitor, and I'll contrast that with entry inhibitors that many other people took on earlier in the RSV era, and pretty much all those replication or entry inhibitors have fallen to the wayside, Um, whereas we concentrated on, um, replication inhibitors in, in both of our programs. But, uh, Zellie was the first discovered as an N-protein inhibitor. Uh, we've taken, as you pointed out, we've taken it into many, uh, clinical studies. First in the human challenge, well, phase one, healthy stuff. Um, great PK, good safety. We've been in over 700 patients now with a very, very good safety record. So there's a good database there. We demonstrated really good activity, antiviral activity and symptom effects in a human challenge study, and then moved into various real-world settings. And so the first study, one probably in retrospect probably wouldn't have run, was in otherwise healthy patients who contracted RSV. It turns out you can't get to those patients fast enough. They self-resolve very quickly on their own. And so the teaching from that is you focus on the high-risk patient populations, and they're at opposite ends of the age spectrum. So high-risk adults, you know, well, let me start with the younger. You're born with no natural immunity. You have to acquire it. And so newborns onwards are incredibly vulnerable until they've had repeated RSV infections in childhood. Then you go through sort of the otherwise healthy period, and then you get into a period of immune senescence. As you get older, you know, the immunity starts to wane. So you have either end of the age spectrum, and also people in the in-between that maybe they're otherwise healthy, But if you have any sort of a respiratory or cardiovascular complication, it can be very, very serious. COPD, congestive heart failure, severe asthma, these things predispose you to poor outcomes with an RSV infection. So we have focused on opposite ends of the, you know, high-risk adults, high-risk, you know, peds, and peds in general are high-risk just because they have no immunity. So to go to your question about LOTUS, so LOTUS is a pediatric study. We're running it in Thailand right now where the RSV season has already begun. And the idea there is to look at about 150 children age four weeks to three years, So, very young children, in some instances, who have RSV and can come into the clinic within 72 hours of, you know, symptom onset. And so, in that study, we're aiming to use our proprietary observer-reported outcome. These peds can't self-report, you know, not in any cogent way. So, we have to use an observer-reported outcome tool. And we've been developing that literally for the last few years in connection with caregivers, physicians, and also groups that create these tools and regulatory bodies in the U.S. and in Europe. So we've gotten a lot of input into building this tool, which we hope to be able to use as a tool for registration studies. So this will be the, you may recall in our first PEDS study, we got it in at the very end of that study. We didn't have the tool ready in time, but we do now, and it will be used as our primary endpoint in this study.

And are you also looking at virologic response, and can you just refresh on, like, what you saw on viral response for RSVPEDS, and is there any learnings from that study to apply here, just kind of given the geographical?

I think the learnings is earlier is always better, you know, and that's why we selected this three days from symptom onset. You know, we saw about a little over a log. It was about 1.2 log reduction, which, you know, doesn't sound like much if you're thinking about hep C, but in a study, and it's very similar to what people saw, for example, in COVID, you know, about a log reduction. And in fact, the only other study that we had to compare it to was one of those entry inhibitors in a study that was run in China. They saw about a 0.6 log, so we about doubled that. So we will be looking at other, but you don't get approved on virology. It's supportive, and we'll be looking at other clinical measures as well. So, but the primary would be on symptoms. That's what we would aim to get approved on.

Great. And then you're also designing a Phase IIb-III study resolve in high-risk elderly, older patients, I would say elderly. Maybe sort of the same compare and contrast between the RSVT high-risk study that you ran, what you saw there, and how you're planning to design this Phase IIb-III.

Yeah, so in some ways, you know, the common denominator is there are high-risk categories, right? So standard risk, as I mentioned before, you really don't need treatment. But in the high-risk categories, we focused on some of the ones that were, number one, in the FDA guidance for RSV, but also ones that were deemed to be high-risk, for example, in COVID. And so predisposing factors are age over 65. We ratcheted that down because we found that, you know, 75 and older is even higher risk. So we're picking 75 and older, or people with COPD, or people with congestive heart failure. That's the so-called HR3 population that we identified in our prior study, and where we saw a very, you know, meaningful reduction in time to resolution of symptoms. So, again, symptom endpoints, we'll be looking at other stuff. We also saw a very, you know, pronounced reduction in hospitalization rate in that patient population. So we're very intrigued to look at that further. It was small numbers in our prior study, but we saw in the placebo group, we saw about a 5% attack rate for hospitalization. One of those placebo patients actually died in the hospital. So it's a severe risk category, and we want to explore that endpoint as well. But it'll be a key secondary.

Got it. And then you had an end of phase two meeting right with the FDA before starting to plan the phase two B3. I guess, you know, what sort of recommendations did they have in terms of the clinical trial design? And on the clinical trial design, is there like a jumping off point from a 2B2-3? Like, is there like an interim 2B data set? And what do you need to see there to kind of justify going into the whole phase three?

Yeah, so I'll answer your questions backward with the freshest one in my memory first. So there will be a break where we can see the data. I think what we want to see is sort of a recapitulation of some of the data that we saw before. Again, the time to complete resolution, the improvement in hospitalization rate, and then what that will allow, and actually coming back to the FDA meeting, you know, going into that, and we got a lot of questions from the sell side, the buy side, are you going to have to do two phase threes, or, you know, how's that all going to work? And you never know the answer to that until you talk it through. But where we landed, you know, we were able to do sort of a single registration study design with this phase to be lead in, confirm, you know, the endpoints, and then use that to, you know, make sure we've got the effect size calibration on the phase three component right, either scale it up slightly or down or whatever. And also look at that hospitalization rate. It gives us another crack to look at hospitalization. You know, that could be a primary if we wanted it to be. At that point, you know, we'd have the latitude to, you know, to flip that into primary category. So it just gives us some chances to observe all that. I think the other thing that came with the FDA discussion was, you know, the notion of looking at vaccinated patients. And so on the one hand, you don't want to fill your whole study, which is meant to just look at high-risk patient efficacy. You don't want to fill the whole study with vaccinated patients because that might, in some fashion, again, we don't know, we haven't looked at vaccinated patients, might blunt your results. And so where we landed there was, you know, we'll study about 10% of the study will be unvaccinated, and we'll have analyses that will look at the non-vaccinated separately so that we can, you know, really carve in on what it looks like, you know, in the unvaccinated, highest-risk patient population. So it'll be interesting, because it's not that we don't want to treat vaccinated people. If vaccinated people come to the doctor with an RSV infection and they're symptomatic enough to be treated, they probably deserve to be treated. So we want to study them, too.

Pretty sure I got Tamiflu and the flu vaccine. Yeah, there you go. I guess when you kind of think about these plans, how reliant are you for development of a bad RSV season? And I know when you ran the original seasonal RSV study, there was a lot of delays as like a period of time where there was no RSV and then there was a lot of RSV. You know, how does that kind of impact your development timelines?

Yeah, well, you don't want to say you always hope you have a good RSV season, you know, but you don't want to have a bad one in a certain way. And as much as you're giving me flashbacks to the pandemic and to the post-pandemic era, where I think what you're referring to was there was no RSV to be found in the world. We had over 100 sites set up in the Northern Hemisphere, Southern Hemisphere. We're looking everywhere for the virus. You couldn't find flu. You couldn't find RSV anywhere. It was all about COVID and masking and social distancing and all that stuff worked. But then, you know, and the key was getting kids back to school. When back to school day came, that's when the virus broke out again. Daycares, you know, became little hotbeds, and they infected grandparents, and you're off to the races again. And it took a while for seasonality to reestablish itself, but it has now. And, you know, that's why the last part of our study, prior study, zipped up real fast once the virus came.

Great. Maybe now pivoting to I&I, maybe we could just start with kind of talking about globally how you pick targets, diseases. Like, what sort of the process that goes on internally in an ant to say, hey, we're looking at all these things out here. Like, let's do a kitten inhibitor. Like, what?

Well, and I'll let Tara come in on some of this stuff. But generally, you know, we try to find things, you know, anytime you can find clinical validation somewhere, you don't ignore it. Anytime you find big markets, you don't ignore them. And anytime you think you can get into an area where you can be competitive, you know, you don't ignore that either. And so you start circling around certain kinds of categories. But one of the things that we were intrigued with, there's so much good stuff that has happened in the I&I space, you know, with monoclonal antibodies. And, you know, they hit some of the first really, you know, some of the hard-to-attack targets, you know, first got out there, demonstrated some blockbuster drug potential. And, you know, once all that settles, the markets get established, the mechanisms get validated, and then you start to zero in on, you know, where could we maybe offer some advantage, if only dosing convenience somehow, with a, you know, with a good, potent small molecule drug. And so we kind of look for those kinds of things. But, you know.

So that leads us to KIT inhibition. You have a KIT inhibitor now in clinical development. I guess, you know, how do you kind of see your asset versus the landscape that's out there for other alternatives of KIT inhibition, whether it be biologic or other small molecule? Sure.

We like the mechanism for KIT in terms of looking at mast cell-driven diseases because it It really concerns the underlying mechanism, so by blocking kit, you're actually driving mast cells towards apoptosis, and so there's just less cells available to drive that pathology. We also like it because, as you mentioned, there is an antibody to kit, BARZO, being developed by CELDEX, which has shown best-in-disease efficacy in a Phase II study. So I think that's really good proof of concept. That's been in both CSU, chronic spontaneous urticaria, as well as CINDU. Those are both in phase three trials at the moment. And they've also established POC in PN, or prorigo nodularis. So I think that's important for the mechanism. We also like the fact that there's really good biomarkers that de-risk the program early on in terms of target engagement. So you can look at serum triptase in healthy volunteers, and that has been correlated nicely with downstream clinical endpoints. And then, as Jay mentioned, you know, there's a large market size here because you could really look at any disease that is driven by mast cell diseases. So in terms of differentiation, obviously I mentioned the antibody. We're going about this with a small molecule oral inhibitor, so it would be oral route of administration. For something that is, you know, longer-term dosing, I think that will be an important advantage and preferred by many patients and physicians. In terms of others that are out there that are oral, there was the Blueprint Blue 808 compound that is now being developed by Sanofi. So, you know, they have had published some phase one data, and we're also So running a phase one trial, that data we'll look to read out later this year in Q4, but we'll be looking to see what the safety tolerability is, and then also, as I mentioned, that serum tryptase data and the PK will be important to inform some of the next steps in terms of dosing.

Got it. So I guess from that description of the phase one data, I mean, what are you looking for in terms of PK, PD, like on the PK side, I would imagine? Is it one stale? Are you looking for a certain level of safe dosing, and then how does that translate to sort of tryptase reduction? Like, what's the hurdle here, and what are sort of the mechanistic-specific or other drug-specific AEs that you're trying to avoid, and what's the feasibility of getting around this?

So our program is targeting QD dosing, and then in terms of serum tryptase reduction, We'd like to see dose-dependent reductions of about up to 80%. I think that's been shown to be connected to downstream clinical endpoints. And then having that dose-dependent decrease allows us flexibility in future studies to think about different dosing strategies where you might be able to maintain the efficacy that CELDEX has shown with antibodies, but perhaps mitigate some of these on-target effects that are known with the KID inhibitors. So some of the things you think about there are, I guess, what I would call more aesthetic changes in terms of hair and skin color changes. Those tend to happen at least, you know, with Seldex's antibody a little bit later on. So probably not as likely to see those in our phase one. The MAD portion of our phase one is dosing up to 14 days. And then they also saw a slight decrease in neutrophils. And so we may see a little bit of that in the two weeks, but what they showed is that you see it decline until about a four-week time point where it plateaued around the lower limit of normal and then was maintained out to, and that study was a year of dosing. So we'll look for all of those things. And if we're able to have a dosing strategy in patients where you might be able to, again, maintain that efficacy but maybe have less of an impact on some of these other cell types like melanocytes, like blood cells, you might be able to have a better profile than the And I think that's something that we'll have to understand in the clinic.

And then assuming, you know, good exposures, good PK, good PD, can you move right into patients with the next step be a phase two in CSU? You know, are there, would that lead you to do even other studies of mast cell disease? I'm thinking like, can you do an inducible urticaria study?

Sure, you can move right into patients. I think we're certainly thinking about urticaria as the next step for POC. It's very well-established, quick and easy endpoints. Whether that's CSU or Sindhu, I think remains to be determined, but either one would work.

Then the next asset, you're moving into the clinic IND submission very soon.

Announcing it now?

No. Stat6, super hot target. A number of Stat6 degraders. People kind of talk about this target with orals as the oral 2P. How do you kind of think about your development of an antispecific Stat6 inhibitor versus the degraders, Which seem to be taking a lot of the air time right now, and, you know, ultimately, how do you see the STAT-6 oral approach in sort of these INI indications?

Yeah, so I remember working on Jack's STAT pathways in the mid-90s, I think, and I can certainly vouch for the fact that they were, you know, some of them were difficult to drug targets, especially on the STAT side. Um, which is where degraders come in, right? So degraders, you know, like to climb on top of targets that are otherwise hard to drug by, you know, sort of classical methods and come in and just, you know, take the protein out. And so I think that that's a great idea, um, in certain environments and especially if there's scaffolding functions involved and things like that, which there isn't for STAT-6. So, you know, a priori, our attitude is why would you use it to greater, if you didn't have to, on a target? You know, you can, and again, it makes sense if it's impossible to drug, but we now know that they can be drugged. You know, we and others have now created some very potent, very, very potent and highly selective inhibitors. Selectivity used to be a problem. It's not anymore. So we can get super selective, very highly potent, and molecules with good PK. Again, the notion used to be that if you didn't have, you know, that small molecules would, you know, when you had good drug levels, inhibition would be up, and then when the levels waned, drug goes away, inhibition would go away, and then it comes back again when you dose again and so on. But we're used to treating viral infections, right, where 24-hour time point, you want to have good drug levels with good levels of inhibition, and you want to do that every day. And so that's the profile that we set in STAT6. So we've shown that we get complete inhibition, we get continuous inhibition, and that we have dupy-like efficacy in animal models of atopic dermatitis and asthma and feel that's what you need to do. So the chemists and DMPK people at NANTA have been working very, very hard on this, looking at all kinds of interesting chemical matter. So we feel pretty good about the program overall, and I'm very confident in the approach.

And then the next announced candidate is an MRGPR X2 antagonist. What led you down this target pathway? It's not as probably well-known in the Wall Street world as Stasix and KIT.

It will be someday. Okay. So, yeah, X2, I think we were drawn to the, you know, as we were with KIT, you know, trying to kind of find multiple different approaches for mast cell-driven disease, and KIT is sort of the big hammer, you know, literally causing mast cells to, you know, apoptose, and X2 has a little bit more finesse associated with it, And some instances, you don't know which one you're going to need, or you need the big hammer or the lighter touch. But it's also been implicated, you know, broadly in other sort of areas that were at least surprising to me when I first started getting into it. And that is in the area of migraine, where you have this crosstalk between sensory neurons and mast cells. And there's some really interesting data now that shows how, you know, X2 blockade could be impactful in migraine. So it's not the classical mast cell disease that you might be thinking of, but there's other interesting mechanistic possibilities there. So we dug into that target, have been exploring a lot of the biology, and have, once again, you know, a broad swath of good chemical matter, and we're zeroing in on our development candidate very rapidly.

Great. Now, there's just a couple minutes left. There's a lot of questions I didn't ask. Pfizer litigation, Maverick royalties, cash runway. What important question didn't I ask that you want to bring to everyone's attention?

Well, royalties are still flowing. That's on the one front. Litigation is still proceeding. And for those of you who aren't familiar with that, That's our ongoing litigation with Pfizer as it relates to Paxlovin. We have a hearing in the European courts in a couple weeks, so that'll be sort of a new installment with decisions. They tend to rally around decisions very quickly in that court, so within several weeks thereafter, we should know something. Yeah, so, and cash, you know, we ended last quarter with a little over 200 million, you know, have runway into 29, and, you know, we should be able to get, you know, clearly to the other side of some RSV catalyst and some, you know, INI clinical data sets.

Okay, well, great. Always a pleasure to have you here. Thanks, everyone in the audience. See you here next year.

I'll give you a good 34 seconds.