LB Pharmaceuticals (LBRX) Fireside Chat - LB PHARMACEUTICALS INC

Thank you, everyone, for tuning into today's Biotech Catalyst Conference here at Craig Hallam. My name is Adam Vogel. I'm a biotech analyst at Craig Hallam, and today we have with us from LB Pharma, CEO Heather Turner. Heather, thank you so much for taking the time to speak with us today. Thank you so mucho por tenerme. Es muy genial estar aquí. Great. Before jumping into Q&A, I'd love to just hand it over to you for a few opening remarks, maybe on what's been developing at LB over the last six months or so, and what do we have to look forward to in the coming 12 months? Yes, thank you. LB Pharma is a late stage neuromedicines company that is dedicated to developing and commercializing high impact therapies for underserved brain disorders. Our asset LB102 is currently being evaluated in schizophrenia, bipolar depression, and will soon be evaluated in adjunctive major depressive disorder. LB102 is a structurally modified version of Amisulpride. And Amisulpride is a generic antipsychotic that has been approved or is approved around the world, but was never approved in the United States as an antipsykotic. And the founders of LB set out to address a very key limitation of Amisolpride, which was poor permeability into the brain. And we did this through this structural modification, which improved the potency of the molecule, which is our asset LB102. And we're now in the clinic in the indications I already talked about. Where we sit today is we've got data readouts coming over 27, 28, and 29. We have a phase three schizophrenia program that is anticipated to read out in the first half of 2027. We We have a phase two bipolar depression program, which we anticipate reading out in the first quarter of 28, and we have an adjunctive major depressive disorder, which we anticipate reading out in the first half of 2029. All of these programs are fully financed for the clinical trials that we're currently conducting, and we have cash that takes us beyond the second quarter of 2029, Perfect. All right. Well, thank you for setting the stage and maybe keeping in with the focus of today's conference, I'd like to turn directly to the near-term catalyst that could meaningfully shape LB's development path and investment story. Maybe just beginning with the opportunity you see for LB102 in schizophrenia, where currently patients and physicians have quite a number of treatment options here, including newer mechanisms. We'd love to hear your thoughts where you see the clearest opening for 102 and which patients would be naturally the good candidates for initial approval? Let's take a step back for a second and talk a little bit about schizophrenia because I think that'll help frame the answer to your question. Schizophrenia is a chronic disorder that has no cure. The goal instead is to treat and manage the symptoms while keeping patients on the medicine. Every time these patients come off medicine, they can actually suffer from a relapse, which can have irreparable harm to their brain. So the goal here is to really try to manage the systems and keep patients treated. So despite the fact that there are many generic options, patients and prescribers continue to face trade-offs between symptom control and tolerability. And this can make it very difficult to reach and sustain an effective dose for these patients. As a result of this, significant switching occurs, which underscores this unmet need. And it's either inadequate efficacy or tolerability that tends to drive patients to come off of their antipsychotics. So this is the opportunity for LB102. LB 102 has the potential to offer what we believe to be will be a better balance of symptom control and tolerability, which of course would then allow these patients to be on a medicine that is both efficacious and tolerable. So commercially, our hope is to have and have LB102 be the brand of choice for adults. All patients in this space have to start on a generic. This is required for payer access. And sometimes it's anywhere from one to three generics. And at that point, they can then move to a branded antipsychotic. And we know that patients get to the branded antpsychotic when you look at the revenue of the market itself, you see that patients get to the branded antipsychotics. And we believe we'll be the first choice among the branded anti-psychotics because we can provide this balance of both efficacy and tolerability, as well as simple dosing. Got it. And then which part of that positioning is supported by the clinical data that we have today and which part still needs to be demonstrated here? Yeah, coming out of our phase two trial, which we announced in early 2025, we believe we observed clinically meaningful efficacy. We saw a highly statistically significant result at the doses that were evaluated, and we saw a very robust treatment effect at the dosage evaluated. And so this, we believe, is table stakes. This is your ticket to entry, so to speak. You have to have this efficacy. You have to give physicians and prescribers confidence that you will treat these patient symptoms. Importantly, though, as I mentioned before, when we talk about balance is the tolerability profile. And what we believe is emerging for LB102 is one that would enable patients to stay on the drug. So for example, one of the leading reasons for tolerability discontinuation is an adverse event known as EPS, extrapyramidal symptoms. This is one of leading reasons for discontinuation of an antipsychotic. And what we observed in our phase two trial was a very low rate of EPS. At the 50 milligram dose, it was just 1%. And at the top dose evaluated, which was the 100 milligram dose, it was 5.6 percent. And relative to other D2 antagonists and partial agonists, this is definitely lower. And this is actually in the range of other antipsychotics which tout next to no EPS. So we think that that really provides a nice profile where patients can stay on the drug. And then finally, we saw and what we tested in our phase 2 trial was a very simple dosing profile. LB102 is a once-daily oral therapeutic where there is no food effect associated with it. We're not anticipating a food effect associated with it. We don't have any sort of, you know, challenging drug-drug interactions associated with it. Patients start at a therapeutic dose. There is no titration. And what we observed in the phase two trial was an effect as early as the very first week of evaluation, which is also something that physicians value. What still needs to be demonstrated is, of course, the long-term tolerability of LB102. The phase two trail was four weeks in duration, and we are in the midst of conducting an open label safety trial. This is to accrue the safety population that FDA requires at the time that you submit your NDA, and this will be 52 weeks in duration. And so we do think we have, we still need to look at and determine what that long-term tolerability profile looks like. Got it. And then maybe just elaborating a bit more on what NOVA 2, the phase 3 trial, needs to establish here in the first half of next year. How should investors weigh pan separation alongside, say, response rates, consistency across measures, and treatment discontinuations? Yeah, I'm probably going to sound a little bit like a broken record, although that dates me a bit, I appreciate. But across all those measures, I really think that you need this balance. It's not any one of those measures that's really going to be a driver of success. You actually need a balance across all of those measures. You know, efficacy, of course, is important because this, of course, gives confidence that the prescriber will see that the symptoms are treated. And tolerability and safety is important, because you want people to stay on these drugs. And the longer you can have them on the drug, the better their response rate and the lower the discontinuation rate, right? So, you know, it is really and truly the case that you need to have this balance of both efficacy, tolerability, and then a simple dosing profile just to make it easy on these patients to take the medicines. Got it. Then maybe on dose selection here, can you walk us through the rationale of taking the 50 and 100 milligram doses into NOVA2 rather than 75 milligram? and what gives you confidence in the higher dose given its smaller cohort size versus the 1575 cohorts in phase two? Yeah, with respect to the 100 milligram dose, you know, we applied the same rigorous statistical and sensitivity analyses as we applied to the 50 and the 75 milligram doses in the trial. And the results were all supportive of the endpoint, which we think provides a lot of confidence, despite the fact that it was a lower number of patients. In addition, when we looked at the tolerability profile for 100, we found it to be favorable. And as I mentioned before, particularly with respect to EPS, going into that trial, we thought that maybe we would see higher rates of EPS and we didn't. And so we found that to be quite comforting. And And so based on these two aspects, we decided to take both the 50 and the 100 into the phase three trial. The other point I'll note is that we do think that there's value in looking at and confirming the higher dose. We think that that is, from a development perspective and a commercial perspective, a valuable thing to do. So that was another contributing factor when we thought about the doses to take into phase three. Got it. If the doses show different benefit-risk profiles, how would that inform the dose you would seek to commercialize? Assuming both of the doses are approved, let's just assume that the risk-benefit profiles observed are approvable and they both get approved, we would still plan to bring both doses to market. We think that this is a fairly heterogeneous population of patients, and so having these two different profiles we think could be very helpful. We know that prescribers like to have alternatives in how they think about treating their patients based on the symptom profile that the patient is experiencing and the tolerability challenges that thepatient might be having. And so we think having those two doses would be helpful. I would expect, like most medicines, that, you know, prescribers would start at the lower dose first and then move up if they need to. But we think Having both of those would be very helpful. Got it. Then maybe an execution and placebo response. So in July, due to rapid enrollment, you announced accelerating O2s readout to the first half of 2027. Previously, you were targeting second half of the year. First, congratulations. And then second, in this context, what are the most important safeguards for maintaining patient selection in rating quality as the study scales, particularly given the placebo response risk here in schizophrenia? Well, this question actually applies in the context of just the trial itself and in the context of an accelerated enrollment, because this is the area of risk that these kinds of trials always have, which is placebo rate. So for us, it starts first and foremost with site selection. It's really important that you go, you audit the sites, you evaluate the sites. and you want to make sure that they have a really robust rater program. So there are local raters that administer the scales that are included in these clinical trials, and you need to make sure that these raters are appropriately trained, that they get retrained if they need to, that there's consistency among the raters, that there isn't a whole lot of turnover among the raters. So that's first and foremost is site selection. The second is trial design. It's important that when you design these trials, you take into account the time that it'll take to complete all of the scales and the nature of the skills. Because we know that both patients and raters can get fatigued and that fatigue can contribute to your placebo rate. So you want to make sure that you're not asking patients to take two days, for example, to complete all these scales, right? They're just going to get tired and that's going to lead to potentially higher placebo rates. So you'll want to be very judicious in the scales that you choose to include in your clinical trial. So our clinical trial was really deliberate in how we thought about it and the scales that we chose to include. And we think that that helps quite a bit, having a more simple trial design. When it comes to trial execution, it's really important that you are staying engaged and really evaluating these sites frequently. This isn't a space where you can hand it off to the year's CRO and let your CRO go and do it on its own. You have to continue to be engaged. You have to continue to communicate with these sites. We also implemented a central rater, which provides some quality control over the local raters. So they're continuously evaluating what the local raters are doing. We have a vendor that helps us. We actually have two vendors that help us to identify and exclude professional patients. So there are a couple of databases that we can look at and access. And so, you know, that's kind of the beginning of this. You have to do this for these kinds of trials. When it comes to this more rapid enrollment, you know it's really important that we stay on top of the data entry into the electronic data capture system, right? We want to make sure that the sites are staying up on their data entry, that they're staying up on protocol compliance. And so we have implemented in this clinical trial a way for our development team to access the data, the blinded data, in real time. So we have an application on their phones that allow them to look at the blind data in a real-time basis. We've specified certain flags that would pop up in certain situations where there might be like an outlier or there might be some inconsistencies with the data. And this allows for us to get on it very quickly. We can query it, we can remedy it. If we need to retrain people, we kan. It just is a really nice way to stay on top of the data and so we're really diligent in that regard and we're also very much on top of the sites to make sure that they're inputting the data in a timely fashion. Got it. Sounds like a very well-designed trial. All right. Then maybe shifting back to tolerability as you brought up previously. So as you noted, 102 has demonstrated encouraging low rates of movement-related AEs and that adds sedation to it. But weight gain and palactin elevations do appear to be remaining part of the profile for now. Thinking about its potential as long-term chronic medication, what does that open-label extension, NOVA3, need to show for prescribers to become comfortable using 102 over extended periods of time? Yeah, prescriber's are comfortable managing prolactin elevations. This is a known class effect of D2 antagonists. Where prolacton becomes problematic is if it manifests as a clinical adverse event, right? And if you start to see frequent clinical adverse events. And not all prolactin elevations result in a clinical adverse event. In fact, in our phase two trial, we saw very few adverse events associated with elevations in prolactin. It was just 1 to 5.6%. So it was really just a handful of events, and none of these events led to discontinuation, and they all were mild to moderate in severity. In addition to that, in the phase 2 trial, we saw a profile for LB102 that is emerging with respect to prolacton, where we think it might actually be better than other D2 antagonists. We saw lower overall increases in prolactin, and we saw what potentially could be a shorter time course of the increase of prolacton. Of course, both of those things will need to be evaluated in this longer-term trial, but I think those will be things that we continue to watch. We did see a bit of weight gain in our phase two trial, as you note. you know, this is one where I really think the long-term safety trial will be very beneficial in truly understanding the profile. What we know about amisulpride is that in a longer-term study where amisalpride was evaluated head-to-head against olanzapine, which is a known problem child when it comes to weight gain and metabolic dysfunction, is in the very beginning of this six-month trial, imisulpride actually had a little bit more weight gain than olanzapine. It then kind of came back down and sort of flattened out over time. It did end in a littlebit of weight gain, but it wasn't anything that was, you know, outside of what you see with other antipsychotics. And it didn't have any sort of impact on the metabolic parameters of these patients. And so we would expect, given that we have a very similar mechanism, given that we would have a similar receptor targeting, that we would have something similar to that of Amisulpride. But as you mentioned, that long-term safety trial is going to be important. Got it. And I guess just piggybacking on that, getting from Novo 2 top line to an NDA, assuming Novo2 is positive, what work remains between the readout and an NTA submission and which elements of that package still need to be confirmed with the FDA? Yeah. We had lined up everything towards that second half of 27 data date, which was the original date that we had articulated for the data. And we had lined up all of the work related to that NDA in consideration of that timeline. And of course, now that we've announced acceleration, we do have to work through how we're going to pull that all in to the timing of the NDA. And it is true that long-term safety and stability data on commercial products can be the long poles in the tent for many NDAs because these things just take time. So we're working through all of that now. We're working though what the timelines might look like. At the end of the day, the pre-NDA meeting with FDA is going to be the ultimate guide as to the timing of the NDA submission. And once we are able to conduct that, we'll come back with more concrete information at that time. Great. All right. Maybe transitioning focus here and exploring what translates from schizophrenia into mood disorders. As you noted, 102 is also being evaluated in two potentially registrational phase two trials, one in bipolar depression and the other as an adjunctive and major depressive disorder. What is the strongest clinical rationale here for 102 in these indications, and which assumptions from schizophrenia should investors actually avoid carrying over into the programs? There's two strong reasons to believe here in the mood disorders. The first is the mechanism of LB102, and the second is the clinical data of AmicelPride. With respect to the mechanism, LB102 is a very selective inhibitor of D3 and 5-HT7. Both of these receptors are implicated in depression, cognition, and anhedonia. In addition, Lb102 has a unique mechanism among the D2 antagonists. It's a benzamide. And as a result of that, it has this mechanism whereby at high doses, it operates to suppress dopamine. So where you would see doses for schizophrenia or mania, it's operating to suppress the dopamine. And at low doses, it preferentially engages with the presynaptic autoreceptors that are implicated in mood and adonia and cognition. And so what you see is that at low doses, it actually triggers the release of dopamine. And so we've got a couple of different mechanisms to believe that we'll see a benefit in the mood disorders. With respect to the clinical data, amisulpride has been studied very widely. It actually has been studies in depression, and it has shown in head-to-head studies to be as good or better than both Zoloft and Paxil. And it also has been shown to be better than placebo with the 4.8 Madras Delta. So in clinical data of Amisolpride, it is shown to Be Effective in treating depression. So based on both the clinical data as well as the mechanistic data, we think we have a high probability of success in the mood disorders. Got it. Okay. As we wrap up here in the last minutes, I feel like this conversation can go on for hours. Unfortunately, we have just a small 25-minute sliver of time. So at your R&D day next week on the 27th, what investor questions do you most want to address about the Phase 3 NOVA 2 trial and preparations for a potential launch? Yeah, the plan for the R&B day next week is threefold. The first is to do a quick summary of what we observed in our Phase 2 trial, and what gives us confidence and excitement about the phase three trial. The second is we will be presenting some new preclinical data that we think will help explain some of the observations that we saw in the phase two trial, as well as information around the mechanism of LB102, specifically this bimodal mechanism that I was talking about earlier. And then finally, we're going to talk a little bit about the commercial planning, commercial positioning, how we're thinking about it, and giving people some insights into early thinking around the commercial strategy. Great. Well, I think that's a great place to leave it. Heather, thank you so much for the time and discussion. It's been a tremendous pleasure, and we look forward to the updates next week. Thank you so Much. Thanks, Adam. Thank you.