Greetings, and welcome to Eledon Pharmaceuticals Second Quarter Financial Results Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded today, August 11, 2022.

I would now like to turn the conference call over to Paul Little, Chief Financial Officer of Eledon. Please go ahead sir..

Good afternoon everyone and thank you for joining Eledon’s second quarter 2022 operating and financial results conference call. I am joined on today’s call by David-Alexandre Gros, Chief Executive Officer; and Jeff Bornstein, Chief Medical Officer.

Steve Perrin, our President and Chief Scientific Officer will not join today’s call because he is attending a funeral. Earlier today, Eledon issued a press release announcing financial results for the second quarter ended June 30, 2022. You may access the release under the Investors tab on our company’s website at eledon.com.

I would like to remind everyone that statements made during this conference call relating to Eledon’s expected future performance, future business prospects for future events or plans may include forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995.

All such forward-looking statements are intended to be subject to the safe harbor protection provided by the Reform Act. Actual outcomes and results could differ materially from those forecasts due to the impact of many factors beyond the control of Eledon.

Eledon expressly disclaims any duty to provide updates to its forward-looking statements, whether as a result of new information, future events or otherwise. Participants are directed to the risk factors set forth in Eledon’s reports filed with the U.S. Securities and Exchange Commission. Now I would like to pass the call to Eledon’s CEO, Dr.

David-Alexandre Gros, DA..

Thank you, Paul, and thank you all for joining the call today. The second quarter marked the beginning of an exciting period for Eledon as we reported the first of four distinct clinical readouts from our tegoprubart pipeline with positive phase 2a results in ALS.

This year, we have been focused on execution across a four clinical trials, kidney transplantation, ALS, IGA nephropathy or IgAN an islet cell transplantation. I’m very encouraged by the progress we have made in each of these areas.

In renal transplantation we recently announced the first patient dose in a phase 1b open label study of tegoprubart in Canada, United Kingdom and Australia.

We look forward to the continued enrollments of this study through the remainder of the year and based on the timing of our first patient enrolled, we aim to provide initial three and six months open label data across available transplant participants in the first quarter of 2023.

Additionally, we announced the FDA has cleared Eledon’s investigational new drug application for IND application for a larger controlled phase 2a of tegoprubart for the prevention of organ rejection in patients receiving a kidney transplant, thereby allowing us to expand our development efforts for this important indication into the United States.

Jeff will go into the trial design in more detail. But I’ll note that this will be a superiority study versus standard of care with calcineurin inhibitors or CNIs. As I mentioned, we were excited to report positive top line data in a phase 2a study of tegoprubart in adults with ALS in May.

Tegoprubart not only successfully met the primary endpoint of safety tolerability, but showed dose dependent target engagement and the level of reduction in pro-inflammatory biomarkers associated with a trend in slowing down of disease progression as measured by ALS-FRS slope.

Additionally, we observed a reduction in a number of biomarkers, also associated with both, IgAN in kidney our graph transplant rejection, which we believe provides significant validation of tegoprubart’s broad therapeutic potential.

With an eye to further progressing ALS clinical development, we will be working with opinion leaders, the patient community and regulators on potential next steps as well as looking at different approaches to fund a potential future trial.

Next, our phase 2a study of tegoprubart in adults with IgAN continues to enroll and we’re expanding the enrollment landscape from our current nine countries with 17 sites into another three additional countries including the United States and China.

Based on enrollment progress to-date, we expect to fully enrolled high dose cohort in the first half of 2023.

Our goal is to provide meaningful insights into tegoprubart’s clinical activity after 24 weeks of therapy in this indication, and we thus anticipate reporting initial six months open labeled data from this study in the first quarter of 2023. Turning islet cell transplantation.

In June tegoprubart was granted orphan drug designation by the FDA for the prevention of allograft rejection in pancreatic islet cell transplantation. This represents a significant regulatory milestone for this program, as we plan to open a clinical site at the University of Chicago in the coming months.

We believe that this will be a major catalyst in the roadmap process going forward. With the planned opening of the Chicago clinical site and in order to more efficiently focus our resources, we made the decision to close the existing clinical site in Alberta, Canada.

We believe the new clinical site in Chicago will be sufficient to enroll the study of up to six participants with Type One diabetes. And we anticipate reporting initial three month open labeled data from this study in the first quarter of 2023.

I’ll now turn over the call to Jeff Bornstein, our Chief Medical Officer to provide additional details no development program.

Jeff?.

Thank you DA. I’d like to begin by discussing our recent kidney transplant efforts.

The cornerstone for the prevention of transplant rejection is the utilization of CNIs, even though CNIs are associated with significant side effects, including beta cell toxicity cause of new onset diabetes, neurotoxicity causing neurological symptoms, leading tremors and decreased cognitive function as well as an increased risk of heart disease.

Additionally, a chronic utilization of CNIs to prevent graft rejection has been associated with significant nephrotoxicity which can impair graft function and even shorten graft survival in the same organ with CNIs are being taken to protect by improving the safety and tolerability of first line immunosuppression tegoprubart has the potential to both improve patient quality of life and reduce overall morbidity in the near term, as well as ultimately improve graft survival rates in the long term.

We are particularly enthused about our kidney transplant efforts because of the large amount of non-human primate data generated both by ourselves with tegoprubart as well as with historic anti CD40 ligand antibodies.

In these studies, non-human primates treated with anti CD40 ligand antibody has monotherapy demonstrated protection from rejection for months at a time versus only days in untreated animals. As DA mentioned, we recently dosed the first patient in our phase 1b clinical trial of tegoprubart in kidney transplantation.

This 52 week open label study was based in Canada, the United Kingdom and Australia is enrolling up to 12 patients undergoing renal transplant with primary endpoints of safety and pharmacokinetics as well as exploratory endpoints including biopsy proven acute rejection, change in EGFR, and biomarkers of inflammation and kidney rejection.

Our goal is to demonstrate that tegoprubart can be safely used, utilized to replace the CNI as part of firstline immunosuppressive therapy and solid organ transplantation and prevent acute and long term solid organ transplant rejection without the use of CNIs.

With enrollment ongoing, we aim to provide initial three months and six months open label data across multiple transplant participants in the first quarter of 2023.

These time points are relevant since acute rejection most often occurs within the first 90 days of the transplant, and new onset diabetes post transplant often begins to be seen as six months. In addition, we were pleased to recently announce a regulatory milestone with the clearance of tegoprubart U.S.

IND application to evaluate tegoprubart for the prevention of rejection in kidney transplant recipients. The IND opening phase 2 study will be a multicenter open label to arm active comparator safety pharmacokinetic and efficacy study that will enroll approximately 120 participants 50 per arm undergoing kidney transplants.

Participants will receive tegoprubart or the active comparator, tacrolimus as part of an immunosuppressive regimen, including corticosteroids and methylphenidate, Morphettville or methylphenidate sodium.

The study’s primary objective is to assess whether graft function at 12 months post transplant in tegoprubart treated participants is superior to tacrolimus-treated treated participants. The primary endpoint will compare the mean estimated glomerular filtration rate eGFR at 12 months for tegoprubart versus current standard of care.

Graft function as assessed by eGFR at 12 months post transplant is associated independently with subsequent graft failure. GFR has been established as an indicator of kidney function in both pre and post transplant patients, and lower levels are associated with need for dialysis and transplantation or retransplantation.

Secondary objectives include safety, incidents of new onset diabetes, biopsy proven and injection, and participants graft survival. We will provide further information on the timing of this study later this year.

Of note, the phase two program includes an open label extension study, allowing for the collection of long term efficacy and safety from both this study as well as the ongoing phase 1b study.

We expect to run both the phase 1b and the phase 2 studies in parallel so we can continue to report data and insights on tegoprubart from the phase 1b study while the phase 2 is running. Next, I’ll move on to ALS and recap the positive top line data we announced from our phase 2a evaluating tegoprubart in ALS.

This was a significant milestone for Eledon as it demonstrated the safety and tolerability of tegoprubart provide an insight into the role and potential impact of tegoprubart in ALS and also help some potential breakthroughs for tegoprubart to other indications with overlapping biomarkers.

The study was an open label multiple ascending dose study that sequentially evaluated one milligram per kilogram, two milligrams per kilogram, four milligrams per kilogram and eight milligrams per kilogram of tegoprubart administered two weeks, every two weeks via IV infusion for a total of six infusions.

In the two lower dose cohorts, we enrolled nine participants per group and as we both escalated, we move to 18 participants per cohort as the higher two doses were where we had projected to see the biomarker effect.

We collected blood sample the screening, and just prior to first infusion for each participant, as well as prior to each subsequent infusion so that each participant can serve as their own control in the study.

The primary endpoint of the study was safety and tolerability, with a range of secondary and exploratory endpoints measuring biomarker activity, or target engagement, changes in pro-inflammatory chemokine and cytokines upregulated in people living with ALS, and changes in ALS functional rating scale, or the ALS-FRS.

The data shows that tegoprubart successfully met the primary endpoint of safety and tolerability with no serious or severe adverse events related to study drugs, and adverse events being generally consistent with what is expected in a population of ALS participants.

Importantly, there were no signs of platelet activation or thrombosis in the participants. And anti drug antibodies were present in less than 5% of samples, all of which were of low titer and did not impact to tegoprubart drug levels.

Tegoprubart target engagement as measured by a statistically significant reduction In CD40 Ligand a marker of T-cell activity and CXCL13, a marker of B-cell activity was achieved in a dose dependent fashion with the largest mean reductions occurring in the two higher dose cohorts.

In addition, we also observed an increase in the percentage of participants who showed a reduced level of these biomarkers in a dose dependent manner. Prior to launching the trial, we identified six pro-inflammatory proteins that have been described in the literature to be elevated in people with ALS, including TNF alpha, MCP1 IL-6, Il-1 and CRP.

We were highly encouraged with these significant reductions in four of the six of these pro inflammatory markers, including TNF alpha MCP1 and rays CRP.

In addition to these ALS associated biomarkers, we observed a total reduction in 23 of 32 pro-inflammatory proteins we detected including mile markers CXCL9 and CXCL10 as well as complements C3 and the B-cell markers IgA, IgG, and IgM. These additional biomarkers are of note, since they play an important role in our other disease programs.

IGA C3 and CD40 Ligand have been associated with disease progression and proteinuria in patients with IgAN. While CXCL9, CXCL10 IgM, and C3 have been associated with kidney transplant rejection.

Lastly, as part of the exploratory endpoints, we reported that tegoprubart target engagement and level of reduction in pro- inflammatory biomarkers are associated with a trend in slowing down of disease progression, as measured by ALS-FRS when compared to a cohort from the ALS ProAct database.

This database is a publicly available data collection from historical ALS clinical trials containing demographic data, as well as clinical outcome measures, including ALS-FRS.

We found that participants with positive target engagement to find those who have at least a 10% decrease in CXCL13 trended toward a greater slowing of ALS-FRS slope when compared to those who did not achieve target engagement.

These data taken together suggests inhibition of CD40 Ligand signaling results in a decrease in pro-inflammatory biomarkers that may result in slowing of disease progression. We are very encouraged by these results, which further demonstrates the safety and tolerability of tegoprubart through the highest dose cohort.

We also believe that showing a relationship between target engagement, reduction and pro-inflammatory markers and change in disease progression measured by ALS-FRS has an important signal in this devastating disease, that further validates our competence in tegoprubart immunomodulatory potential in ALS.

Finally, we look forward to presenting our data at an upcoming ALS conferences later this year. Moving to IgAN. We believe in the strong mechanistic rationale for pursuing CD40 Ligand inhibition in IgAN due to tegoprubart’s potential ability to show beneficial effects on both the upstream and downstream pathophysiology of IgAN.

While the current standard of care and other drugs development, generally aim to either reduce production of antibodies, or to alter kidney hemodynamics to reduce protein loss and tissue damage tegoprubart has the potential to impact multiple steps in the pathophysiology.

In fact, multiple steps in the pathophysiology are reducing production of IgAN antibodies, reducing the production of anti IgA IgG antibody, reducing immune complex formation and reducing cellular inflammation in the glomerulus itself.

We are happy to report that continue to dose patients in our open label phase 2a clinical trial in patients with IgAN. We have been actively engaged with regulators across the world and now have approval for clinical trial sites in nine countries with plans to expand into up to three additional countries, including the United States and China.

This global study is a 96 week open label trial that will include 42 total participants in high dose and a low dose cohort. The primary endpoint is changed and the urinary protein to creatinine ratio or UPCR at week 24. Secondary endpoints include change in estimated glomerular filtration rate at week 96 as well as safety and tolerability.

Based on enrollment trends to-date, we anticipate fully enrolling the first cohort of this study in the first half of 2023. We believe it’s important to accumulate 24 weeks of clinical data across multiple patients in this indication in order to properly evaluate tegoprubart potential.

And therefore we anticipate reporting initial six months open label data from this study late in the first quarter of 2023. I’ll wrap up my update by turning to islet cell transplantation and our phase 2a trial for the prevention of allograft rejection, where we are about to open our US site at the University of Chicago.

We believe this new site will be a critical step to jumpstart the enrollment process of this study by allowing us to concentrate resources and close our Canadian sites.

A key advantage of the Chicago site it has focused on these novel types of approaches in islet cell transplantation is considered experimental in the United States, and we are confident that the new clinical site in Chicago will be sufficient to enroll the study up to six participants.

This site will be actively screening for Type One diabetic patients with hypoglycemic unawareness to experience significant swings in glucose levels that are associated with serious risk and comorbidities. Our goal is to evaluate tegoprubart has the backbone of maintenance anti rejection therapy, similar to the design for kidney transplantation.

In ICT specifically, we’re also evaluating the ability of patients to achieve insulin dependence, as well as the number of islet cell transplants required to achieve independence.

We believe that by removing CNI, which are directly toxic to the islet cells, and replacing with tegoprubart more patients may be able to achieve better glycemic control with fewer islet cell transplants.

With the opening of our first US site, we are looking to enroll the first patients in the space to islet cell transplantation trial, and aim to provide available three month data in the first quarter of 2023. With that, I’ll now turn the call over to Paul for a financial update..

Thank you, Jeff. In addition to the financial results summarized in our press release, you can find additional information in our form 10-Q, which we will follow later today.

The company reported a net loss of 9.2 million or $0.65 per share for the three months ended June 30, 2022, compared to a net loss of 7.4 million, or $0.50 for the same period in 2021.

Research and development expenses were 5.7 million for the three months into June 30, 2022 compared to 4.2 million for the comparable period of 2021, which was an increase of 1.5 million.

The increase was primarily due to an increase in clinical development costs of 600,000 primarily with external CROs, as we advanced tegoprubart programs, and an increase in consulting expenses of $800,000 as well as personnel costs of $200,000 due to an increase in headcount and stock based compensation costs.

G&A expenses were 3.5 million for the three months ended June 30, 2022, compared to 3.7 million for the comparable period in 2021, a decrease of 200,000.

Looking at the cost side of our business, we continue to remain diligent in the control of our discretionary spending, and this reduction in year-over-year G&A spin is a reflection of these ongoing efforts.

As of June 30, 2023 Eledon had 70.5 million in cash and cash equivalents which we expect to be sufficient to fund our clinical trial operations that’s currently planned into 2024. Our cash runway allows us to initiate the phase 2 trial of tegoprubart for the prevention of organ rejection in patients receiving kidney transplant.

But additional financing will be required to fund any future ALS clinical trials. With that financial update, let me turn the call back over to DA. .

Thanks, Paul. As we discussed today, we are encouraged by the progress we made this quarter throughout our pipeline. And we are excited to continue the positive momentum generated in the first half of this year.

We believe the first of our four tegoprubart clinical readouts demonstrated not only the potential to treat ALS, but also a broader range of inflammation related indications by targeting the CD40 Ligand pathway.

Through the remainder of the year, we will be focused on enrollments across our three ongoing trials, as well as preparing for the launch of our larger phase 2 kidney transplantation study. We look forward to providing meaningful data updates for each program, starting in the first quarter of 2023. I’ll now ask the operator to begin our Q&A session.

Operator?.

Yes, thank you. At this time we will begin the question and answer session. And the first question comes from Thomas Smith with SVB Securities..

Good afternoon. Thanks for taking the questions. Just I guess first on the updated data timelines.

I understand there are a lot of moving parts here but can you provide any thoughts on how many patients we can expect to see across each of these initial datasets in Q1, ‘23?.

Hi Tom, and thanks for the question. We expect to get the same number of patients that we’ve been discussing in the past. It’s really just a slight change.

So as you know, beforehand, we had been talking about late this year, with the timing of when we started enrollments in transplant, and IgAN in order to make sure that we have sufficient patients, that just delays us slightly into the first quarter.

So we should have, the target is to have a few patients in the transplant indications and then a handful of patients with six months of data in IgAN..

And then on islet cell transplant.

Can you just talk a little bit more about the team at the University of Chicago? And I guess just give us a sense are they actively performing these procedures today as part of other clinical studies? And if they are kind of what the volume of that might be? And then I guess your thoughts around potentially expanding out to other centers in the U.S.

I think there are 15 to 20, other academic centers that are performing these procedures. But I’m just curious how you guys are thinking about the expansion of this program..

Sure. So maybe I’ll start with the second part. And then Jeff, I’ll turn it over to you to talk about the first part of the question on the University of Chicago. But to answer your question about expanding right now, we’re looking to focus on the University of Chicago.

And because our IND includes cell manufacturing, right now that’s specific to the site. So the goal is to see if, and we believe we’ll be able to begin to enroll and to get traction in Chicago and then over time, of course, we can revisit and think about where else we may go. Now, Jeff, I’ll turn the call over to you in terms of the site..

Thank you, DA. Thanks, Tom. The University of Chicago is very active. They’ve been involved in islet cell transplant for many years. They’ve done it in their own, under their own experimental protocol, as well as protocols with other sponsors. They are active right now.

And so they’re very confident that they can enroll our study, and we’ve enjoyed working with them and their collaborative spirit and their enthusiasm. So we’re very confident in them..

The PI is the same person, there’s the same person who presented at our R&D day..

And then just lastly, on the renal transplant program, and congrats on the progress here, but the first patient dose and the recent IND clearance.

Can you can you share any feedback on your engagement with FDA and maybe just some of the thought process behind running the larger phase 2 program in parallel with the ex-US open label program?.

Sure. So we can’t share much about discussions. But perhaps what we could do was talk about how we ended up opting for superiority study.

Jeff, why don’t I turn that over to you?.

Sure. Yes. Thank you, DA. So the thought process behind the design of the study was that it provides certain advantages. Superiority, will allow us to design a smaller study, but also at the same time, perhaps have some longer term commercial advantages there. The agency did give us feedback around trial design and did guide us in that direction.

And from our point of view, regardless of what phase 3 looks like, this study is going to be big enough and informed on the right endpoint to enable the correct design, whether that’s a confirmatory trial that confirms this design or whether we have to switch to a different endpoint. We believe that this is designed to inform all of it..

Okay, great. That’s super helpful. .

And to your question about the phase 1b study, we plan to run as we discussed, both in parallel. And the advantage of doing that is that it’s going to allow us to continue learning about tegoprubart and it will also give us a way to continue to report data about the performance of tegoprubart in kidney transplant while the larger study is running..

Got it. Understood. Alright guys, thanks for taking the questions. Appreciate it..

Thank you. And the next question comes from Rami Katkhuda with LifeSci Capital..

Hi guys, congrats on the recent updates. And thanks for taking my questions. Two quick ones for me.

First, to clarify in a previous point, is mean EGFR potentially an improvable endpoint in a potential phase 3 study? Or are you still going to have to focus on kind of graft survival long term?.

Sure, so Jeff why don’t I turn that over to you?.

Yes, sure. Thank you. So as you’re probably aware, the precedents in this space has been non inferiority in phase 3, focusing on graft rejection and patient graft survival. The mean change in EGFR has not been used to support approval. But that doesn’t necessarily mean that it can’t be in the future.

And so our plan is to look at the data we have and keep engaging with the agency. And like I said, on the response to previous question, we’ll be ready with the data from this trial, whichever pathway that takes us down..

Got it. That makes a lot of sense.

And then to nephrotoxic, as we’ve talked about in the past, but can you quantify how much the treatment usually affects EGFR patients receiving a kidney transplant in the first year?.

Jeff?.

Yes I can take that DA. So it’s variable, of course patient to patient and also depends somewhat on the quality of the graft that they got, but looking at datasets from published data, and also from head to head trials with, for example, the trial, the mean GFR in GNI treated patients typically is lower and tends to decline.

And the rate of decline again, is different in different individual patients. But it is predictive there is data showing that if the EGFR at one year is below a threshold of 50 ml per minute per body surface area that is predictive of poor graft function in the long run and even graft loss.

And the lower you go, the worse the higher the risk of that bad outcome. So it is predicted and that’s it’s not surprising, because it’s predictive, and it’s used as a validated surrogate in non-transplant indications.

If you look at the IgAN program, the ultimate endpoint is GFR approaching as a surrogate that’s reasonably likely to predict. And the reason that GFR is the ultimate endpoint is that it’s known. It’s known as a effective standing for the clinical outcomes of dialysis and kidney failure.

So it’s not surprising that the GFR can predict that and consistently exposed patients do have lower GFR and their GFR decline over time..

Thank you. And the next question comes from Matt Kaplan of Ladenburg Thalmann..

Hi, this is Raman in for Matt. Thanks for taking our questions. Congrats on getting the FDA on board with tegoprubart study. Very impressive. I just wanted to ask this.

How your view of the Phase 1b that you already started that change in light of the interactions for the phase 2 program?.

Thanks for the question, Raman. Let me turn that over to Jeff..

Yes. Thank you.

So if I’m understanding the question correctly, you’re asking if our thinking around the 1b study has changed in light of getting the IND open for 2a is that right?.

Yes, I was wondering if there’s potentially maybe the FDA is kind of evolving their thinking or perhaps yes..

So I can’t speak for the FDA and what they’re thinking but for us, nothing’s changed. We are executing our ongoing trial. We think that that trial is going to provide very meaningful data on the safety and efficacy in a pilot program for sure, but still very meaningful data on what tegoprubart can do in this population.

And as I mentioned on the call, our intent is to add a long term extension trial to the program, not just to the phase 2a study, but it would also allow for those patients have the opportunity to continue long term, should they, so inclined when they’re doing well.

And this will allow us to gain additional information over time on durability on long term outcomes in that sentinel cohort, we’re very committed to that patient population and the participants in that trial. Nothing’s changed for us with the new study also coming on, in terms of with the existing study..

Appreciate that, I guess. .

Just one addition, just to clarify, the 1b is ex-U.S. So while the phase 2 is where the IND was just cleared, the 1b will remain ex-U.S. And as you might recall, a year ago, when we had, when we went ex-U.S. with a trial, the agency had asked us at that time to do a non-human primate study.

So what’s changed has been the really the completion of that non-human primate study and then the agency clearing at our IND..

Okay, appreciate that. Yes, I guess, one more question on the islet cell program. Congrats on making progress on opening, preparing the site. I was wondering if there’s any lessons, perhaps from the Canadian experience that you might transfer over? Any helpful, any insight would be helpful? Thanks..

Yes. It’s a very fair question to ask, but it’s a difficult one to answer because there was multiple circumstances that contributed to that not going the way we had hoped in Canada. And wasn’t just one thing that there was definitely an impact of COVID.

There was also some changing almost geopolitical landscape and how islet was covered and across Canada, and changing dynamic of who was referred to the site. So there were a lot of different factors that contributed to it. It’s a fair question to ask, but unfortunately, don’t have a great answer for you.

There’s not one great takeaway that we had that we’re going to say, Aha, if we do this different, it’s going to go better. We do feel very confident, and and the team at University of Chicago, and we do believe it’s going to go different there.

But there isn’t really one key takeaway that we’ve taken from that, that we can apply going forward..

The key what Jeff just mentioned. So here, the focus is the site. Since islet cell transplants are considered experimental procedure in the U.S., all of the patients that are going through the site, are focused on getting an experimental procedure. So that allows for a slightly different conversation to be had with potential participants in this study.

And as well, it allows for some different coverage and a different role in terms of our being able to support the program versus a program where we’re parts of the cost could have been covered by the Canadian authorities..

Right. I appreciate that color. Thanks..

Thank you. And this concludes a question and answer session. And I’d like to turn to DA Gros for any closing comments..

Thank you very much for your assistance operator. And thank you all for joining us on today’s call..

Thank you. The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect your lines..