Pharmacokinetic (PK) and exposure-response modeling of a selective sphingosine 1-phosphate receptor-1 modulator (CS-0777) was conducted in an iterative process to guide early clinical development decisions. A model based on preclinical data from monkeys was extrapolated to humans to support a single ascending dose (SAD) study. The model was updated after each cohort, providing guidance on both maximal inhibition and time to recovery for lymphocyte counts. A 2-compartment PK model with first-order absorption and elimination was found to describe the monkey and human datasets. The relationship between lymphocyte counts and active metabolite (M-1) concentrations was modeled via an indirect response model, whereby M-1 inhibited the reentry of lymphocytes to the circulation. The indirect-response model based on SAD data had an Imax of approximately 85% and an IC50 of 0.24 ng/mL. Additionally, based on SAD data, similar models were developed for lymphocyte subsets, including CD4 cells. Subsequently, simulations were utilized to design a multiple ascending dose study with adaptive dosing regimens that would meet targeted pharmacodynamic (PD) response thresholds (eg, minimum 40% reduction in lymphocytes) while maintaining CD4 counts above a reasonable safety threshold. In conclusion, model-based development and use of adaptive designs for dose optimization can reduce the time and number of subjects needed in early clinical development.