Joseph Coletti 00:06

Welcome back to Pathfinders, a podcast series from RBC Capital Markets where we uncover the key trends and catalysts shaping the fast-moving world of biopharma and healthcare. I'm your host, Joe Coletti. Today I'm joined by Dr. Jeff Stein, President and CEO of Cidara Therapeutics, a clinical stage company developing long-acting immunotherapies through its Cloudbreak platform. We'll talk to him about the company's lead antiviral program, its expansion into oncology and how the company's navigating the fast-changing landscape of biotech.

Dr. Stein, thanks for joining us.

Jeff Stein 00:39

Joe. Thanks a bunch, really excited about this.

Joseph Coletti 00:43

So why don't you start off, for those that may not be as familiar with Cidara, and maybe talk a little bit about your mission. How do you define the company's core purpose and what unmet needs are you aiming to address?

Jeff Stein 00:54

Yeah, so Cidara has been around since 2014 when we founded, and we were founded on the concept of applying bispecific immunotherapy to infectious disease. That was obviously early days, but we got public pretty quickly. Went public in 2015. That was based on our lead program, an antifungal, which was not an immunotherapy, but it was a very compelling opportunity for us to advance something in infectious disease. And back then, this was a tremendous unmet need. We took that molecule, Rezafungin, from pre-clinical to approval in 2023 in the US and in Europe. Along the way, this immunotherapy platform evolved up until the point in 2018 when we discovered our current lead molecule, CD388, which is potentially transformational, is the truly first opportunity to have universal protection against influenza. And I use that term in its broadest sense. The term universal influenza vaccine has been around for over 20 years. It has been a holy grail of big pharma companies trying to make something that's broadly protective, that can protect year after year against a changing flu virus, including pandemic strains. It has never come to fruition, but let's assume that miraculously, some company comes up with a universal vaccine. It's not going to work in all people. As we learned during COVID, you have to have a robust immune response to respond to a vaccine. And as it turns out, in the US, there are over 50 million people in high-risk or immune-compromised populations that simply don't respond to vaccines, or if they get a flu infection, it results in hospitalization or death. So this is an enormous population in the US. At Cidara our mission is to address this population with this first molecule, CD388, which is designed to offer single dose universal protection against all strains of influenza in all people.

Joseph Coletti 03:09

I want to stay on CD388, just for a second. You talked a little bit about maybe what it could mean for flu prevention in the future. I love, if you want to expand that a little bit, but I also want to get a sense of what that could mean for your own broader antiviral strategy.

Jeff Stein 03:24

When you think about the annual, seasonal vaccination all of us should be getting, it is really the only line of protection that we have available, albeit it is not adequate, but the challenge in doing that are several fold. Number one, the flu virus changes year after year. And every year, the vaccine manufacturers have to make a guess. Typically, they make that guess by looking at what flu strains are emerging in the southern hemisphere, preceding the northern hemisphere flu season, because they have to make a commitment, it takes about six months to manufacture that vaccine. Unfortunately, this last year, they guessed wrong on one of the two strains of influenza A. That led to a less than adequate coverage of this year's vaccine. And as it turns out, this was the most severe flu season in the last 17 years. So we get around this by directing CD388, against a universally conserved active site in the end, which is neuraminidase. It does not change from year to year. It's identical in every strain of influenza, and because it's an antiviral drug, it's not a vaccine that elicits an immune response. It has durable protection year after year. It's administered once a flu season in a subcutaneous injection, much like you get your annual flu vaccination.

Joseph Coletti 04:56

When you're talking to investors about what you're doing and some of the innovation and the potential,

do you feel that they're grasping the full opportunity?

Jeff Stein 05:09

We're getting a kind of a groundswell of interest now, and some of that is attributed to the fact that a lot of the other kind of standard approaches have started to fall by the wayside. And in influenza, it's clearly vaccines.

Joseph Coletti 05:25

That's very interesting. And with your dual focus on antivirals and oncology, how are you thinking about pipeline to spin and what defines kind of a high priority program at Cidara today?

Jeff Stein 05:39

Well, clearly the highest priority, and I could hazard to say the only priority, is CD388, right now. So we have a robust early stage program of oncology molecules that are preclinical. The most advanced is CBO 421, which is very similar modality, but directed against the CD73 target. That has a cleared IND, can go into the clinic at any time. We have parked that right now. We're a small company, about 40 people in the company, strictly focused on CD388. That small team had fully enrolled a 5000 subject phase 2B study from a standing start in May of last year, we started coinciding with the flu season at the end of September, fully enrolled 5000 subjects over 10 weeks from the end of September to the beginning of December, and then that happened to coincide with a historically severe flu season, which started about two weeks after we enrolled that study. So when you think about obviously, having a historically severe flu season is terrible for people, but it's great if you're enrolling a big clinical study.

Joseph Coletti 06:54

How do you think about strategic collaborations today? And, in your experience, like, what have you looked for in developing the right, or finding the right partner, but also developing the right partnerships?

Jeff Stein 07:06

Yeah, I think by and large, most biotech companies are looking to gain validation capital and market reach partnership. Clearly, I've done that in my past with multiple partnerships. We're in a different situation now at Cidara, given the increasing attention, the momentum and the stock, the unmet need, in a political backdrop which is disincentivizing interest in vaccines and in a market which is clearly the historical territory only a big pharma, a multibillion dollar market, we're more in the driver's seat than a typical biotech company at our stage and size of development. So what we're looking for is not so much the validation. We actually partnered CD388 at a pre-clinical stage with J&J. That was a global partnership. So they had global rights to the program. They funded us to conduct the phase I and the phase II A study. But we are the beneficiary of a strategic pivot at J&J in the summer of 2023 when these they decided to exit the infectious disease space broadly. We had two phase Is and a phase II A study, and they started the same divestiture process as with other big pharmas. We were able to intervene in that process by virtue of raising a $240 million PIPE financing with top tier biotech investors, and we outcompeted the big pharmas in that process and got the rights back. So we now own global rights to the program. We owe no royalties on it to, back to J&J, and with that capital, we're able to embark on this large phase 2B study.

Joseph Coletti 09:10

That's excellent to hear. When you think about all the external forces that are shaping your decisions and the decision of others right now, which ones are you most focused on, most worried about thinking about most as you sort of continue to drive the company forward?

Jeff Stein 09:22

Well, I think the area of uncertainty that is first and foremost in everybody's mind is the political variability that we're all experiencing. And in particular in biopharma, it's, in regulatory, is the FDA, what is their decision process? What is the time frame of that decision process? What will they be prioritizing? From our perspective, as much as we hate to see the changes in leadership at the FDA, we have not experienced any delays, or we have, in fact, seen quite the opposite in our interactions with the FDA.

Joseph Coletti 10:04

So I want to ask you just about your principles that have guided you, you know, both here and earlier in your career, through periods of reinvention and scale, especially as you shift from partner model to independent development. Can you talk a little bit about that?

Jeff Stein 10:17

The old adage is you lose credibility only once, right? So you have to maintain that credibility, and the only way, or best way, to do that is through maintaining a high level of integrity in all of your dealings. So we've applied those principles throughout our history, it has enabled us to weather through very difficult times in the company's history. Like most successful companies, we have come close to running out of cash multiple times. We've always been able to do a key financing partnership that has enabled us to weather through those down periods. Many companies right now are experiencing those down periods. But if you have the right team in place, if you believe in the technology platform, you're solving big problems, and you can communicate that vision with integrity to investors and potential partners, you stand a good chance of being successful.

Joseph Coletti 11:18

Well, that's excellent. We wish you best of luck. It's been a real pleasure to have you on the podcast, and we hope you'll come back.

Jeff Stein 11:24

Joe, thanks so much. It was fun.

Joseph Coletti 11:28

Thanks for listening to Pathfinders in Biopharma, brought to you by RBC Capital Markets. Please remember to subscribe to get more great content and be alerted about future episodes. This episode was recorded on May 21, 2025. If you’d like to learn more or continue the conversation, please visit rbccm.com/biopharma. See you all next time.

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