Episode 41: David Esposito - President and CEO at ONL Therapeutics

What if your vision could be saved by the precise application of innovative biotech? Join us as we talk to David Esposito, President &  CEO of ONL Therapeutics, and delve deep into his take on leadership. He shares how his military background has been instrumental in the successful management of clinical trials, particularly when navigating the unpredictable terrain of the COVID-19 pandemic. With their pipeline ONL1204, a FAS inhibitor targeting retinal disease, O&L Therapeutics is making significant strides in the ophthalmology space.

First In Human is a biotech-focused podcast that interviews industry leaders and investors to learn about their journey to in-human clinical trials. Presented by Vial, a tech-enabled CRO, hosted by Simon Burns, CEO & Co-Founder. Episodes launch weekly on Tuesdays. To view the full transcript of this episode, click here.

Interested in being featured as a guest on First In Human? Please reach out to catie@vial.com.

🎧 Stay in the Loop!

For the latest news and updates, visit our website: https://vial.com

Follow us on social media for real-time insights:

Twitter: https://twitter.com/VialTrials

LinkedIn: https://www.linkedin.com/company/vialtrials

Chapters

• 0:06 Managing Clinical Trials
• 13:07 Precision Medicine in Ophthalmology

Transcript

Speaker 1: 0:06

You are listening to First In Human, where we interview industry leaders and investors to learn about their journey to in-human clinical trials presented by Vile, a tech-enabled CRO hosted by Simon Burns, ceo and co-founder. Featuring special guest toast Amy Delmedico, vp of Ophthalmology. In this episode, we delve into the challenges of managing clinical trials effectively. Join us as we explore the importance of striking the right balance between collecting every data point and ensuring efficiency in the study process.

Speaker 2: 0:42

Hi, I'm Amy Delmedico. I am Vice President of Ophthalmology at Vile, which is a technology-enabled CRO. I'm really thrilled today to be talking with President and CEO of O&L Therapeutics, David Esposito. David, would you like to give an introduction?

Speaker 3: 1:00

Amy, thank you very much for having me. It's nice to be on the program. As you mentioned, I'm David Esposito, CEO of O&L Therapeutics. O&l is based in Ann Arbor, Michigan, right outside the University of Michigan. My background is about 30 years in healthcare, Started off my career with Merck in commercial roles. I've worked with the commercial strategy for about 15 years and spent the last 15 years of my career building early mid-stage life science companies. It's terrific to talk to you about O&L and all that we're seeing in the marketplace.

Speaker 2: 1:33

Thanks a lot, david. I'm going to kick off with a question that I know you've definitely been asked more than once, but it's a good one. I know that you have military backgrounds and I wondered how that has influenced your leadership style.

Speaker 3: 1:46

I went to my undergrad with the United States Military Academy at West Point and served in active duty in the Army infantry with the 101st Airborne Division.

Speaker 3: 1:54

I think over the course of my career those early leadership lessons from the military certainly weave into very practical aspects of my leadership here.

Speaker 3: 2:04

I think of the day-to-day work in an early-stage biotech, albeit some of the differences of life and death scenarios in active duty military. But I think the ability to deal with an evolving landscape of change, whether it's patients in a clinical trial, adverse events, outcomes you're looking at the ability to be steady towards the common mission that we all have but ultimately resilient to deal with unexpected changes in the landscape of an early-stage biotech or changes on the battlefield. That idea of being able to interpret new pieces of information and continue to move forward towards a common mission is probably one of the common traits between both military leadership and early-stage biotech. I've come to fully appreciate in that and I think the other piece of that is just making sure the team is aligned around that common mission. I think we at ONL certainly have stated direction of helping patients see the future, and so we address a number of blinding diseases of the retina that we hope that can make a real difference in people's lives.

Speaker 2: 3:11

It's all about your people, isn't it? I imagine that you learned a lot about managing people when you were working in the military. Am I right in thinking that you've been at the helm of ONL for is it nearly five years now?

Speaker 3: 3:22

Yes, coming in my fifth year, exactly right the time I joined Owen Hill back in 2019, like many early-stage biotechs, we had a number of good pre-clinical endpoints with our lead compound and we were in that challenge of raising capital and finding the right clinical indications to go forward with. And that's where pretty much the work of the team has been over the last four plus years is really bringing that solid pre-clinical evidence into the clinic.

Speaker 2: 3:53

What strategies would you say have been crucial for your success at O&L and the other companies that you've worked with?

Speaker 3: 4:00

With an early stage biotank. It sounds really cool that you have a small number of people making decisions real quickly. The challenge with that coolness, that environment to do that, is you can zigzag a lot of different ways back and forth just because you have a small team and perhaps can make decisions quickly. I think one of the key factors of our time over the last four or five years with O&L and some of the other companies that had the privilege of leading is working with the team to build a very clear operating plan around some of those key areas. One is raising capital. How do you tie that capital to value inflection points, whether they be in research or development? Those operating plan swim lanes, so to speak, that are very clear on timing, on cost and ultimate value is what has helped us at O&L move along from both very good preclinical data to ultimately what's the initial indication we chose? That was retinal detachment with a follow-on indication of geographic atrophy and then open angle glaucoma.

Speaker 3: 5:07

I think piecing together that operating plan that's time-bound, very clear value inflection points is what the team has been able to execute very well. On when something investors or potential investors seem to resonate, with a real clear plan, what capital can get deployed to be able to deliver on over time. So I think that's been a foundation of all of it, of O&L over the last half of the years to do that. I'd also say to your question dealing with uncertainty when we built that plan and raised the initial capital, it was 2018. Covid was not an issue at that point and then certainly COVID and the impact of our clinical trial pace was something we didn't anticipate. But the team had to respond and we seem to have, like many others in the field, to try to keep the data coming and getting out in front of it. So again, I think that initial outline of an operating plan and then executing on it has been real critical to our success.

Speaker 2: 6:04

And I think something that's great is that you've got a really strong pipeline, haven't you? It's one asset, but you've got multiple indications. So O&L 1204 is a fast inhibitor. I wonder if you could talk a little bit about how you expect that to target retinal disease, how it works and maybe if there are any insights from the clinical trials that have been done so far.

Speaker 3: 6:22

True glad to share it. This original work on the relevance of fast inhibition as a target started with our founder, dr David Zaks, who's a retina specialist at the University of Michigan. It was David's initial research that really showed the potential of inhibiting the fast receptor to make a difference. And so in David's original work demonstrated the relevance of the fast receptor in the acute condition of retinal detachment. Also there's been published data on both wet and dry AMD and then also in open angle glaucoma. So through a number of preclinical models what was clearly demonstrated is that the fast receptor and inhibiting that fast receptor is upstream of many of the current targets that are out there, specifically in GA around compliments. So fast is upstream of compliments. So we do think the ability to inhibit the fast receptor which I should have said at the onset, you know is across those different disease states when activated, triggers the death of retinal cells and the release of inflammatory cytokines and chemokines. And so by blocking that fast receptor we're able to protect those retinal cells and quiet the inflammatory response that has been shown across those three distinct disease states. Preclinically, and now over the last four years, we've really demonstrated the translatability of each of those models into human trials. So we've just completed enrollment in a phase two study.

Speaker 3: 7:56

Retinal detachment Our phase one data proved very consistently blocking the fast receptor could make a real impact on retinal detachment on top of standard of cure surgery.

Speaker 3: 8:07

And now, as maybe you mentioned, with geographic accuracy, our phase one data with own L1204 lead compound with an every 90 day injection is showing the ability to slow lesion growth in GA of upwards of 40 plus percent. And so we think that has a real differentiator in the marketplace. Given the current two approved therapies are monthly or every 60 day dose and showing 20, 25% slowing the lesion growth. We think what we've demonstrated in our early clinical trials now, inhibiting the fast receptor, can have an outsized impact on lesion growth for GA. And then we're just now seeing some early indications in open angle glaucoma. That's bearing fruit of the translatability from our preclinical models in glaucoma into humans as well. And we've timed our operating plan to where we're in phase two study. Retinal detachment Now we've looked to kick off a GA phase two in the next 12 months and then soon after glaucoma ramble a little bit on that, amy, but hopefully covered ground with the relevance of 1204 and living the fast receptor.

Speaker 2: 9:15

No, thank you. That's great, and it's also very interesting to hear that there's some innovation going on in the world of glaucoma as well as the retina side of things. So thank you for the background. I'm going to talk to you a little bit about partnerships and collaborations. We know how challenging it is to develop new therapies, particularly in the retina space, because it's just so busy and I wondered what sort of collaborations and partnerships you've found have helped O&L to advance your pipeline. It's obviously a really busy time for you at the moment.

Speaker 3: 9:44

It's critical. These diseases are complicated. The opportunity to really make a difference is very hard. We depend on a number of different core partners and collaborators to help move our operations forward. At O&L we're a small full-time team. We have eight full-time employees. We have about eight almost full-time or near full-time consultants that work with us on those fronts. But I would say first and foremost it's our scientific collaborations. Our key opinion leaders, our scientific advisory board members have been very supportive of our journey in helping us define the clinical programs to really show a difference of inhibiting the fast receptor.

Speaker 3: 10:28

Amy, we're a privately held company. So our investor base we have three of the leading ophthalmology-focused venture capital firms on our cap table that have been very supportive in guiding our programs. In addition to we have some strategic investors as well, and both Novartis and Janssen, through their financing arm, jjdc, has been very helpful for us. From that standpoint, those collaborations and input from key opinion leaders and investors have been super helpful, but also from our clinical research partners in executing this study, help us design the right protocols, the most effective protocols that can accomplish our clinical objectives, but also making them recruitable and practical has been super helpful. In addition, those collaborations with regulatory authorities, and what we look for in partners from our CRO standpoint is now that these trials are getting bigger and all-encompassing.

Speaker 3: 11:27

The ability to reach globally the US is a core market for us. Obviously, we're doing trials in Australia and New Zealand as well, but some also will need to be moving into Europe and other parts of Asia to be able to complete these trials. I think where we really think about collaborations on the CRO side that help deliver these trials critically important for people to know they work well with our team but also have the same degree of flexibility and resilience, because we're all in it together to get these clinical trials done and it's complicated work, as you very well know with your current job and your experience.

Speaker 2: 12:06

I liked your comment about making your protocols recruitable, because it's so difficult, isn't it in the rest of the space particularly to make a protocol that meets the needs of the study but is also not overly complex such that investigators don't want to be involved in it. So it's a hard line to tread, I think, sometimes.

Speaker 3: 12:27

Amy, I agree with you on that point. Specifically, we'd all love to have every data point and a massive amount of things to go through. So not going to spend two days in the study site working through that and general on some of these studies, and so I think, having the right Sierra partner to really help to make those issues out because there's really no right answer, there's just probably a more effective answer than one or the other and I think, working to really figure out that balance of data points, plus being able to recruit, manage the study site well. It's not an easy task but having the right partners we found can really get there if you try hard enough.

Speaker 2: 13:07

So I'm going to change text slightly now and I wanted to ask you about precision medicine. It's a bit of a hot topic at the moment. I wondered how you felt it could be applied in the ophthalmology space.

Speaker 3: 13:18

Well, we are seeing it in various forms on a number of different therapeutic areas. My prior company before coming to O'Neill was in cancer diagnostics, so we were identifying biomarkers to help identify risk prediction indexes for prostate cancer, lung and breast cancer early on, and so you see much more of a precision medicine approach in cancer therapeutics these days with regards to biomarkers to help support and select agents. I think we're starting to see that in ophthalmology. One particular group that we've been working with and have deployed through two of our three clinical programs, one in GA and one in La Colma, is a company called Novii, the United Kingdom, that has the dark technology, D-A-R-C detecting apoptosis retinal cells. It uses a fluorescent label and accent tag to be able to identify stressed cells in the retina. So I think that technology developed by Francesca Cordera and her team at Novii has been very helpful to validate in GA for us sick and stressed cells on the border of lesions. It's also been published and validated in La Colma as a higher dark chimp maybe a rapid progress in La Colma. So I think those technologies like dark are starting to come around to be able to help perhaps identify the right, appropriate patients for clinical trials.

Speaker 3: 14:45

We're also seeing some genetic information come together but I think that's still a little bit early on in retinal disease. But I think that kind of idea of identifying the right patients for the right therapeutic target has begun to evolve in ophthalmology. We're seeing in GA with regards to lesion size, trying to predict growth and so certain called sweet spot of lesion size that seems to be rapid progressives with the ability to show a therapeutic impact over the course of 12 or 24 months is another area. So I think it's beginning and I think quite frankly for GA and you touched on there hasn't been a lot of innovation in La Colma over the years therapeutic lies that we feel that could be a real opportunity for precision medicine again to identify the right patients for a therapeutic that could be assessed a therapeutic impact quite earlier than perhaps waiting for five years to see a traditional visual field change.

Speaker 2: 15:48

Yeah, that's really interesting and I think that the NOVA, the dark technology, is fascinating and I hope they get used on more clinical trials because it's got a really good positive impact, I think, on some of the trials that it has been used on, so it's good to hear a bit more about that. Just to wrap up, really and you alluded to this at the start you know, throughout your career, I imagine you see lots of shifts in approaches to funding and to research. I wonder what your crystal ball shows. What do you think are the trends for the future?

Speaker 3: 16:15

For most biotechs out there. I think everybody would say it's been a tough couple of years in terms of raising capital and moving programs forward. A little bit of that was COVID in the earlier part of that year, but it's been tough capital markets, whether they're publicly traded biotechs or in the private markets. Venture capital firms over the last couple of years have certainly been working on their own portfolios and even though they've been raising new funds it's been difficult to deploy capital. So, going forward, I think at the end of the day in ophthalmology it's still a very interesting area where there is the attraction for capital to move some of these programs forward because there's large unmet needs. With geographic outer theater, the advanced form of dry AMD been a lot of interest and now, most recently, with two drug approvals in the US for GA and hopefully moving forward across the globe, there's been a lot of interest now that that pathway is open to really see what could be done for these patients that have been without approved therapies since identification of that disease pathway decades ago and in addition to the opportunities to advance the treatments in glaucoma. So from an ophthalmology standpoint we see there's still large unmet need and there is a real appetite for capital to be raised to move programs forward. So we think that bodes well for us in the ophthalmology field.

Speaker 3: 17:41

Many times the big macro effects of inflation, the overall economic demand, do hinder some of those capital raising opportunities.

Speaker 3: 17:51

But at the end of the day I think good technologies that can potentially meet large unmet needs can get there.

Speaker 3: 17:57

So we're excited about that morning business and I would say the other, the other part of it is what you touched on Somebody evolving technologies, whether it's dark technology, somebody improved imaging technologies that can help support advancing therapeutics and identifying treatment effects early on and before is what gets us excited as a team to see we've got capital, we've got some new technologies that can help move it forward. And then, when you wrap it all up to what you described in some of the precision medicine, a lot of that comes down to how can we aggregate these data points, whether it's from imaging or biomarkers, the data aggregation of these factors in the machine learning aspects that can improve care. Those are probably three big areas of excitement for us. We think there's going to be capital moving forward and we certainly think that new emergence technologies will be there supported, and then you put all that in a big machine and crank it out from an AI standpoint. We think that'll bring us a benefit down the road as well.

Speaker 2: 19:00

David, thank you so much for sharing your insights, as usual, this being an absolute pleasure. I really appreciate your time today, thank you.

Speaker 3: 19:08

Amy for helping me. It sure was a pleasure on land too, and I look forward to you out speaking with you down the road.

Speaker 2: 19:15

Thank you.

Speaker 1: 19:23

Thanks for listening. Be sure to follow us on Spotify, apple, youtube and Google.