Conference Transcript - PLYX 2026-04-16

Serge Belanger, Analyst — Needham

Good morning. I'm Serge Belanger, one of the healthcare analysts at Needham. I want to welcome everybody this morning to our 25th Annual Healthcare Conference. And for our next presentation, we have the Polarix Therapeutics team with us. This is a company that recently went public. They're developing products for rare pediatric disorders. We have the company's CEO, Alex Wang, with us. So, I'll hand it over to Alex. He can introduce his team. And I think he has a slide presentation, after which we'll proceed to some Q&A. So, Alex, welcome, and I'll hand it over to you to make the introductions.

Alex Wang, CEO

Great. Well, thanks, Serge. And I'm very pleased to also be joined with our team members here. So I'm going to have Lisa and Jay also introduce themselves because they'll be also speaking on some parts of this presentation. So I will let Lisa introduce and also Jay, and then I'll take it up from there.

Lisa Bollinger, Other

Very good. Thank you, Alex. I'm Lisa Bollinger. I'm a pediatrician and I'm the chief medical officer for Polarix. Jay?

JVGN, Other

Thank you, Lisa. I'm JVGN. I'm the Chief Scientific Officer at Polarix. Thank you. And Alex, over to you.

Alex Wang, CEO

Great. Thanks. So can we go to the next slide, please? So before we dive into some of the detail matters, particularly science and some of the trial design, I'd like to give you some key highlights for the company. Pilarix Therapeutics is focused on, as Serge mentioned, pediatric orphan indication, which is largely known as lysosomal storage disorder. There are roughly about 50 to 70 different known genes that would cause these symptoms and disorders, and they basically involve some level of depreciation or some level of waning down of lysosomal functions, and sometimes it'll be completely knocked out. And so what that means is that at the intracellular level, particularly in the brain or some of the very essential organs, you may not have these lysosomal functions to clear waste, which could be devastating for many children who are born with these conditions. And there are many indication subtypes that are out there that are just not met with any effective treatment or approved drugs. And so this is highly unmet areas, and mostly it's affecting children as they're born with these gene mutations. questions. Another key highlights that we would like to mention to you is that we have a very interesting trial that's coming up. We sort of call it a basket trial. And we're basically using our lead drug candidate. It's almost like a platform type as a main driver to basically test a number of different subtype of indications within LSD. So within a basket trial design, we're actually running multiple indications all at once. And so this is an effective way to address these highly unmet areas. And as mentioned to you, there are many subtypes. So this would allow us to actually get into a number of patients within similar group to address this highly unmet area very effectively. And obviously, the company had previously been doing INDs that are approved for registrable trials for a few indications, particularly CLN2 and CLN3. But we have decided to pivot towards a basket trial in a phase two. But really, essentially, it's an open label study design. I think that that's going to be really key to drive us in the right strategies to prove how we can actually demonstrate the effectiveness of the drug in a very meaningful way. But also, I think working with the FDA, we felt that this is the right approach to show how we can actually demonstrate the effectiveness and safety in a much more effective way than simply just going on a phase three trial and trying to just target one indication at a time, which will take a really long time. So we want to cover that later on. And despite the fact that we actually had two INDs that are approved, essentially of registrable trials, we pivoted towards a basket trial. And I think that that's a very meaningful and risk adjusted approach. And we're able to work with the FDA to have an open label study design. And as you could imagine, a lot of these trial designs involve patients and they go through a long trial duration, roughly about two years. And so if you're trying to bring in these patients in phase three trials, and oftentimes they go through a double blind placebo control type of trial design, it's very difficult to enroll these patients and it's unethical and so forth. So we think that with this open label design, with the historical data that we have to compare as a controlled group is much more ethical and reasonable and effective way to handle these disease indications with particularly children. The other part that we would like to obviously showcase is our strong science background. And from the industry, as we have seen in this area, lysosomal stories disorder, it's very unique to find a company that has really a plethora of scientific data, particularly involving very precise animal models. And what we typically deal with in many of the drug discovery phase to bring in commercialization, that involves animal-to-human translatability. And one of the key aspects to increase that translatability is whether we use the right model, the gold standard model. That is a very important factor to this. And I think that, as mentioned to you earlier, lysosomal steroid disorder generally involves a single gene mutation among a number of these genes that are known to cause these lysosomal deficiency. And what we're able to do is to use the right animal model to tweak the particular gene that causes the disease and use that specific and precise animal model to test cascades of how the mechanism of action actually treats and effectively address these diseases. And so we can demonstrate that as Jay will later cover that too. And so that's kind of the main highlights for us to share with you today. Let's go to the next slide. This one shows our pipeline. PLX200 is our lead drug candidate, and that's the one that now we're trying to go for basket trial. We named this Soteria, named after goddess of safety and deliverance. We do also have, in addition to our lead candidate drug, 505B2 repurposed drug, we have 300, which is a new chemical entity. PLX100 is a combo drug between PLX200 and retinoic acid. And PLX400 is a novel gene therapy, particularly interesting in a way that it's going to be administered through intranasal pathway. So our company is obviously not just one modality, multiple modality companies, but obviously we're focused on Soteria with PLX 200 in a basket trial. Let's go to the next slide. Right. Again, before we get to, you know, some of the specific areas that we want to cover, particularly science and trial design, I just want to reiterate the point that three really important points that we feel that would create value for investors. First is, as mentioned to you, we have a very strong scientific discipline and evidence that shows how these animals that are particularly designed to show and to mimic the human patients. And using those animal models, we have done proof of concept studies in a number of cascades of drug progression. And so that's very, very strong. Now, having said that, even if you have a strong science background, sometimes you fail because the trial design is not the right one, in particular when you're dealing with children, you know, long-term trial duration, things could easily go wrong. And so what we have tried to do with BASCA trial phase two, instead of going for phase three trial, that could basically mean, you know, sometimes because of the FDA's onerous requirement to go for some sort of double blind placebo control model, which is very difficult to even enroll patients. and you will not be able to actually see any data until the completion of the trial. Having phase two with open-label study design gives us an option to look at the data and look at how the patients are dealing with it. And also, as mentioned, BASCA trial has a number of indications we're doing all together, and so it gives us risk diversification as well. And we have looked at it, and Lisa will go through this, we have done a lot of studies in terms of how to measure the right domains to see the clinical benefits for these children. And we have worked with the FDA for a number of years to get to some of these. And then also we have gathered significant natural history data. These are patients who have unfortunately untreated, but given their data and all the points that we have measured, we can use them as a controlled group to compare to our treatment arm, which will be an open label and just receiving our drug, that gives us an opportunity to really show the effectiveness of the drug between the two groups. And another thing that I could briefly mention is that Polaric's team is under an M-Stone, a platform model, and M-Stone has managed a number of companies that are also focused on pediatric orphan indications. And so we actually managed a company called Epigenics, and we were able to successfully exit that two years ago in rare epilepsy. We have another company that's also involved in pediatric orphan indications. So our team is quite experienced and obviously is committed to address these indications within pediatric orphan areas. Next slide, and then I'll hand it over to Jay.

JVGN, Other

Thank you, Alex. So, good morning. As Alex mentioned, our trial is focused on four indications. Two of them are neuronal seroid lipofaskenosis, or NCLs, and two are non-NCL LSDs. This is Crabay and Sandoff. And there are about 70-odd mutations that are known for lysosomal storage disorders. And the incidence rate for lysosomal storage disorders is 1 in 5,000. And the earliest age of onset is about two months. On the right-hand side is a simple cartoon explaining a normal lysosome and when the waste accumulates, as is the case with lysosomal storage disorders, that makes the lysosome non-functional and leads to the pathogenesis of the disease. Next slide, please. So this is a slide which talks about the mechanism of action. As Alex mentioned, lysosomal diseases are caused due to a single gene mutation, and the mutation leads to compromised function of the gene product. And many of these gene products are enzymes that catabolize the particular substrate, specific substrates. And when the function is compromised, it leads to the accumulation of these substrates. And ultimately, this waste accumulation leads to neuroinflammation and neurodegeneration. So the bottom is our mechanism of action. So our mechanism of action is actually the differentiator, we feel, compared to all the approaches that are seen in drug development in lysosomal storage disorders. For example, ERT or gene therapy or substrate reduction therapy, they address a specific gene product that is involved in these diseases. But as you know, these diseases are etiologically starts with this particular gene, but leads to secondary complications like inflammation and neuronal cell death. And that's where our mechanism of actions are really unique. So the first mechanism of action is our lead drug candidate, PLX200, is a PPAR ligand, and when it binds to the PPAR nuclear receptor, it leads to the downstream regulation of genes. and one of the genes is the T-Fab. And T-Fab is the master regulator for lysosome biogenesis and autophagy, and that helps with the upregulation of the deficient gene product and also the clearance of the waste material. In addition to the lysosome biogenesis, PLX200 also upregulates anti-inflammatory cascades like the IL-1 receptor antagonist and SOX3, and it also increases the neurotrophic factors, GDNF and BDNF, and in addition to the neurotrophic factors, it also suppresses apoptosis via the activation of PI3 kinase and the phospho-AKT, and phospho-AKT leads to the upregulation of BCL2. Next slide, please. So in the interest of time, I have chosen one slide for each indication, and this is in a CLN3 disease model. On the left-hand side is the upregulation of T-feb, and on the right-hand side is the storage material. So you can see on the left-hand side, T-fab is stained in red, and it's in the mutated animal. There is hardly any T-fab. And with the treatment of PLX200, you can see that the T-fab regulation, T-fab is upregulated. And on the right-hand side is the storage material. and it is stained by SCMAS which is the subunit C of the mitochondrial ATP synthase and here this is the normal animal where there is very little waste accumulation and this one is the mutated animal where you see increased the waste material and with treatment the waste material is cleared with 4 mg and 8 mg And here is the quantitation. Can we go to the next slide, please? So this is the CLN2 mouse model, which is CLN2 knockout mouse model. On the left-hand side is the motor deficits, measurement of the motor functions. And on the right-hand side is the life expectancy. As you can see, the black bars represents the normal animal. And this is basically an open field arena assay. So you put the animal in the open field and allow it to move around freely, and the movements are recorded by a video camera on top of the open field, and there is a software that will spit out the various parameters, and you can see the various parameters are movements, horizontal activity, or total distance covered, or let's say the number of movements, or the time the animal rests. And the black is the normal animal, which you can see, for example, in the horizontal activity, with normal activity. And in the mutated animal, there is a reduction in the movements. And this is a mutated animal with the vehicle treatment. And when you treat it with PLX200, the activity is restored. And similarly, it's true for the other parameters, for example, distance or movement time, et cetera. On the right-hand side is the Kaplan-Meier plot, which shows the life expectancy. The mutated animal is about 120 days of life expectancy. With treatment of PLX200, the life expectancy increases almost 50%. And the bottom is just a quantitation. Can we move to the next one, please? So this is a Sandoff disease mouse model, which is a HEX-B mutation. and this is the cortex of the Sandov disease mice and the normal animal. On the left-hand side is the normal animal and is staining for what is called pariodic acid shift staining and that stains the glycolipids. If you see in the middle is the mutated animal and you see the higher intensity of staining which means they increase ganglioside accumulation in the cortex. And with treatment of 4 mg per kg body weight, it brings back to normal levels. And the right-hand side is just a quantitation. If you look at the further right, this is the heat map of the open field arena, which I was talking about in the earlier slides as well. So you can see on the left-hand side, the heat map, this is for the normal animal. And here is the mutated animal, which hardly moves. And this is after treatment, which comes back to almost normal levels. And this is, again, a Kaplan-Meier plot showing the life survival of these animals. The mutated animal lives about 120 days. And with treatment, it doubles the lifespan in this Hexp knockout animal model. Can we go to the next slide, please? So this is some of the data from Kyber disease mouse model, which is a Gal-C knockout. And Krebe disease is a demyelinating disease, and so mostly affecting the white matter-rich regions of the brain. And on the top here is the cerebellum, and the bottom is the corpus callosum, which are both white matter-rich regions. And this is stained with the antibody against psychosine, which is the storage material in this Krebe disease. So you look at the green staining. This is a normal animal. And this is the GAL-C knockout. You can see this increased psychocene levels. And the treatment, the psychocene levels brought back to the levels that are seen in the normal animals. And this is quantitated here. Similarly, in corpus callosum, psychocene is reduced with treatment with PLX200. Again, you can see it on the right-hand side. and this is again the heat map of the movement to the motor function reflecting the motor function this is a normal animal and this is the galaxy knockout with compromised movement and when treated with PLX200 it brings back to normal levels and this is again Kaplan-Meier showing survival this is a knockout animal this is a very aggressive disease and the animals live about 30 to 35 days. And with treatment with PLX200, it increases life expectancy at about 50%. And I'll hand it over to Lisa.

Lisa Bollinger, Other

Thank you, Jay. So our clinical development strategy involves a flexible and catalyst-rich plan. We actually, as Alex had mentioned earlier, did have two earlier INDs approved. That was the STARLIGHT and the CLN2 pivotal trial. However, after having a lot of discussions with patients, the treatment community, and other experts in the field, we decided to pivot to Soteria, which is our phase two open label single arm basket trial that evaluates PLX200 in CLN2, CLN3, Crabbe, and Sandoff. The IND was initially approved in 2025. If we can go forward to the next slide. So our Soteria Phase II trial is highly flexible, and it's designed to have multiple inflection points. It is flexible because it's open label, and we have up to 101 weeks to assess safety and efficacy, but we also have inflection points throughout the trial where we can assess both safety, and efficacy. We initiate with a sentinel group of CLN2 and CLN3 to test for early safety and tolerability, and we do have the potential to seek accelerated approval in the case of compelling data in these two cohorts. We do already have fast-track designation, and we could then follow up with breakthrough therapy designation once we have clinical data, which is targeted in case of a favorable data readout. And maybe we can go on to the next slide, but we also have the potential to enroll patients with other LSDs as well. So the Soteria Phase II trial is designed as an open-label study where we will be comparing against the natural history of CLN2 and CLN3. This is something that has been done previously for other treatments in this area, specifically brinyura. And at that five-week point, if we don't have any safety events that would preclude us from moving on, we will enroll two other cohorts. That would be in Sandoff and Crabbe. The activity endpoints were identified based on the natural history studies. So we were matching what they did in those studies in terms of endpoints. And these endpoints are validated and accepted by the FDA. We are also gathering additional biomarkers to help strengthen the case for our therapeutic benefit. The enrollment criteria, too, have been designed so that way we enrich for patients who will be having the most disease activity, so that way we can truly assess what the treatment effect is in a shorter period of time. As this diagram shows, we have the safety assessment at five weeks, and then after 52 weeks, we have a formal interim analysis, and at the 101 mark period, the study will end for our final analysis. However, as I did say, this is an open-label trial, and so this gives us the opportunity to really assess if there are compelling results that would drive us to go speak with the FDA about potentially receiving accelerated approval. With that, I'll go on to the next slide. So this just shows part of our product lifecycle and market share strategy where we're really working on novel formulations and combination therapies that are user-friendly. Currently, our lead product is PLX200, which is an oral solution. And this is much easier for patients than the more invasive current therapies that are available. And right now, the only real therapies that are available are Brynura for CLN2, and some of the patients can receive stem cell transplants. But as you can see, these other therapies are highly invasive and not patient-friendly. We do have some future formulations under development as well for PLX200, which is a buccal tablet.

Serge Belanger, Analyst — Needham

Can we go to the next slide?

Lisa Bollinger, Other

So one of the things that we're really focused on is making sure that we're serving these patients. We are united by a clear mission to improve the lives of pediatric patients and their families by closely collaborating with patient advocacy groups, research and treatment institutions, and centers of excellence dedicated to these particular patients. We have a strong scientific foundation, a robust pipeline with patient-friendly therapies, and an experienced team. We are uniquely positioned to make a meaningful impact for these patients with grievous diseases. Next slide. And I think I turn this back over to Alex at this point.

Alex Wang, CEO

Sure. Yeah. Thanks, Lisa. So, I mean, in terms of the market size, as Lisa mentioned, there is a one approved drug, Brunura, which is enzyme replacement therapy. Basically, you have to drill holes in the brain and inject the enzyme directly into a child's skull, basically. And it takes four to five, six hours of hospital operation every two weeks. and you have to go through a lot of other tests before and after. And so it's a highly invasive and really almost like a chemo therapy as we hear from some of the family members and the clinicians. And that's just only a very slim and small portion of NCL patients. There are 14 subtypes, CLN1 through 14, and that's just CLN2 because that drug only addresses that CLN2 enzyme, TPP1. And so I think what we're trying to do is to introduce a drug that would basically be beneficial for all across lysosomal steroids disorder. And as Jay mentioned, that's what the mechanism of action in our drug is doing to really reverse those lysosomal deficiencies and anti-inflammation and early cell death and everything. And so what we're also trying to do with the basket trial, which is really squarely aligned with our strategy to address this highly unmet LSD indications, which is really divided into multiple subtypes and indications. So the market is, in fact, each subtype could be small, could be a couple hundred to a few thousand. But if you add all of them and they're really significant, And in fact, these numbers are not the entire patient population based on incidence rate, but these are just simply addressable markets that we can identify in the U.S. and Europe and some of the rest of the countries where the diagnosis and things like that are relatively easy. And given the drug pricing, the comparable drug that we can also mention is Brunura, which is set at roughly about a million dollars per patient per year, plus the hospital fee would be a couple hundred thousand dollars a year. And our drug, I think that could be much lower, but having a much bigger market share could be a standard of care drug just given to the children upon diagnosis and really try to help them through the whole cascades of these disease progression. And so we think that with safety and easy administration and the applicability across the board will really give us the chance for the big market share. So that I think concludes our slide. Again, And I think that strong science and the trial design that really addresses the market that's really needed right now, and again, that open-label study design that allows us to read the data and announce those critical data at the right time without having to wait all the way to the completion of the trial, which is typical case for double-blind placebo control that allows us to really share the news early on with the investors and, of course, as well as the family members. And as Lisa also mentioned, there are certain designations that are acknowledging the effectiveness of the drug much at the lower bar compared to sort of, you know, FDA approval process, But like breakthrough therapy designation, under the report that we have seen, 76% of the drugs that have received breakthrough therapy designation do end up going and getting the approval at the end of the day. So what we're also looking at with this design is from investors' perspectives, there are really a number of small inflection points going all the way towards the end. And then with the design and with the natural history patient data we can compare as controlled arm, there is still a possibility, even though it's phase two, to go for some sort of conditional or accelerated approval. So it really gives us tremendous opportunities across a number of different inflection points and the ability to really share any safety or efficacy data with multiple indications. We're going after four right now, CLN2, CLN3, Corvents, and Of. But we do plan to actually add on a few more indications and also increase some of the patient numbers as we have agreed with the FDA. And so it's really a flexible and also very unique design. I don't think we have this kind of basket trial in LSD or many other pediatric or indications, but I think that we're very lucky to have a drug that works across multiple indications across with this strong scientific background, and we're really excited to really get this thing up and running very soon. And so I guess that'll conclude our presentation. And then I guess, Serge, we can go for any Q&A or, yeah. Yeah, absolutely.

Serge Belanger, Analyst — Needham

Well, thanks, Alex and team, for the overview on Polarix and the unique development path that you're embarking on with the Soteria trial. Well, so curious within your FDA interactions, do you expect the Soteria study to support a broad LSD label where it would be more for the four subtypes that you're targeting? And I guess the follow up to that is how many patients per subtype would you require in a trial to support a label for usage in that subtype? Maybe Lisa, maybe you can go first.

Lisa Bollinger, Other

Yeah, sure. You bet. So usually the FDA actually requires that you study each unique indication because these are different diseases in order to have that in the label. So giving a broad LSD labeling is unlikely. That being said, we actually would anticipate that we would be able to obtain unique disease specific indications across the four LSDs that we're looking at. And remember that two of these diseases are actually leukodystrophies or gangliodoses. And so we could also expand into other diseases like, for example, Tay-Sachs. In general, what we need to have is robust data in several unique indications. But as we move forward, we do believe that the FDA would be open to looking at the totality of evidence as we go into new indications. So we would anticipate that we would only need small numbers for each of the indications as long as we're efficacious and safe, of course. So I actually do think initially we will have these patients that we have in Soteria, we will add additional patients. And depending on how compelling the data is, we would move forward to seek approval, whether it's regular or accelerated with the FDA for each individual indication.

Serge Belanger, Analyst — Needham

Okay. And do you expect PLX200 to be similarly efficacious across the different subtypes? Or it could vary depending on the pathology of the gene mutation?

Lisa Bollinger, Other

You know, it's hard to say until we have actual clinical data. However, based on the mechanism of action that Jay shared earlier, our PLX200 works high enough in the disease cascades that we would anticipate a similar effect across all of these diseases. Again, I say that with a grain of salt because we do not yet have clinical data.

Alex Wang, CEO

Okay. And just to add some color as what Lisa mentioned, you know, the BASCA trial design, if you kind of think it through, and as we have identified centers of excellence, these sites and clinicians, they often treat patients across a number of subtypes. And so there's a tremendous efficiency in terms of running the trial. And obviously, we're not trying to mix with a lot of different drugs. They could obviously have some confusion and whatnot, but having one drug to work with multiple centers of excellence, but they treat, obviously, CLN2, CLN3, Sandifin, Crobet. And so we can run these trials in a very cost-effective and time-efficient manner. But also, as some of these subtypes, like, for example, For example, NCL is comprised of 14 subtypes of CLN 1, 2, 3, and 4, and 5. So if we were to show strong data on a couple of those, then there may be a possibility of some sort of a blanket within those subgroup within LSD. And so, yeah, I think that, you know, to address your point, yeah, it's unlikely that the FDA will simply just say, hey, just because you've shown two to three or four subtypes of LSD that we're going to just give you everything, blanket approval, we'll need to continue to do this. But the time and the cost of doing that would be so much more efficient with this basket trial design, and we can flexibly increase the number of patients. So this really gives us an opportunity to manage it very quickly, but then also expand very quickly. So much better than doing it separately and obviously other drugs only addressing one indication at a time.

Serge Belanger, Analyst — Needham

Okay. And I think as part of the trial, you're looking at biomarkers as well as functional endpoints. I'm assuming that we're going to see an impact on biomarkers earlier than the functional endpoints, but how long would we have to wait? I think you mentioned also interim analyses every six months. So at six months or 12 months, do we start seeing some of these impacts on functional endpoints?

Alex Wang, CEO

Yeah, Lisa, if you want to.

Lisa Bollinger, Other

Yeah, OK. I think it really depends on which which one of the diseases we're looking at. So we have, again, disease specific and accepted biomarkers. Some of them are exploratory for each of the different subsets that we'll be looking at. And we really don't know in humans what that rate of change is going to be, so we'll have to look at that as well. We do think that the TPP-1 for CLN-2 may change earlier, so we'll just have to keep our eyes on that.

Serge Belanger, Analyst — Needham

Okay. I think we only have a couple of minutes left, so maybe I'll ask Alex to just give us an overview of financials, where the cash balance is, and what kind of runway it provides you. We're obviously done a direct listing.

Alex Wang, CEO

It was a very difficult market the last couple of years to do, sort of standard IPO. So we did not raise additional funds through that direct listing. We were listed since late January. But we're able to obviously go out and raise some additional funds. And so I think we're in good shape to initiate the trial and to see some of the safety data and enroll some more patients. So I think that we're pretty good for probably a year, year and a half or more. And so we do expect to raise some additional funds later next year, which will give us enough funds to then complete the trial. But I think that from the company's perspective, as well as investors, I think it's a more financially prudent way to do this. And that's because it's an open label design. We'll be able to show safety data. We'll be able to show some efficacy and give really ample evidence as to why we should go on. And I think from companies' perspectives, also, as we go through the inflection points and we can increase our value, so the next raise would be not as a big dilution. And we think that it's good for everybody and working for the investors and so forth. But we're very much focused right now. We're ready to go. And so we're going to, you know, kickstart the trial very quickly and open sites in a few months.

Serge Belanger, Analyst — Needham

OK, well, great wrap up and we're up on time. So thank you for joining us this morning and telling us more about Polarics Therapeutics and your clinical program you're embarking on. Thank you.