4D Molecular Therapeutics, Inc. (FDMT) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by, and welcome to 4D Molecular Therapeutics webcast presentation of Interim Safety and Efficacy Data from the Phase 1 AEROW Clinical Trial of Aerosolized 4D-710 in patients with Cystic Fibrosis Lung Disease. [Operator Instructions]. As a reminder, today's call is being recorded. With that, I will hand the call over to August Moretti, Chief Financial Officer, who will make introductory comments.

Thank you, operator, and welcome, everyone, to 4D Molecular Therapeutics' 4D-710 interim data webcast. A press release describing the results and development plans related to 4D-710 is accessible in the Investors section of the 4D Molecular Therapeutics website, and a recording of this webcast will be accessible on our website after completion of this call. With me today are: Dr. David Kirn, our Co-Founder and Chief Executive Officer; and Dr. Jennifer Taylor-Cousar, Professor, Departments of Medicine and Pediatrics, and Co-Director, Adult Cystic Fibrosis Program; Director, Cystic Fibrosis Foundation Therapeutics Development Center, National Jewish Health. Dr. Taylor-Cousar is the lead principal investigator on the 4D-710 AEROW clinical trial. She will present the interim AEROW data tomorrow at the 2023 European Cystic Fibrosis Society Annual Meeting. As a reminder, on this call, we will be making forward-looking statements regarding our clinical data from our AEROW clinical trial, product development plans, research activities and business plans. These statements are based on management's current expectations and are subject to risks and uncertainties that may cause actual results to materially differ from those forecasted. A description of these risks can be found in the "Risk Factors" section of our most recent Form 10-K and Form 10-Q, which are on file with the SEC. With that, I'd like to turn the call over to our CEO, Dr. David Kirn. David?

Thank you, Augie, and thank you, everyone, for joining us today. We're excited about our growing pipeline powered by our efficient product design and development engine. Today, we'll focus on our Pulmonology Therapeutic area. This product portfolio is based on our proprietary vector A101 that was invented for efficient aerosol delivery to the lung. Specifically, we're pleased to share with you positive updates on 4DMT's 710 program, including Interim Clinical Data from our AEROW clinical trial for participants with Cystic Fibrosis lung disease in patients not amenable to modulators. Given the results to date in this population with the highest unmet need, we plan to continue developing 4D-710 both for patients who are amenable or not amenable to modulator therapy. Here are the key takeaways for today. In Cohort 1 of the AEROW trial, we treated 3 participants with an aerosol dose of 1E15 vgs of 4D-710. 4D-710 is designed for routine outpatient treatment via an FDA-approved aerosol device, enabling widespread delivery throughout the lung airways. We are enrolling participants with the most severe mutations with the highest unmet need who have no disease-modifying therapies available. Regarding safety and tolerability, 4D-710 was well tolerated with no 4D-710-related adverse events following dosing with follow-up of 9 to 12 months. For lung biomarker analysis, bronchoscopy was performed at 4 to 8 weeks, and multiple airway biopsies were collected in each participant. We observed widespread and reproducible CFTR protein expression in over 90% of airway cells in all samples, and at levels that were well above normal and highly statistically significant compared to controlled tissues from people with or without CF. Promising evidence of clinical activity was demonstrated by following spirometry and quality of life endpoints. One participant had a baseline percent predicted FEV1 or ppFEV1 of 69. This ppFEV1 is considered to be moderate CF lung disease. In this population, the historical annual rate of decline in ppFEV1 is roughly 2.5%. Following 4D-710 treatment, this participant's ppFEV1 showed a meaningful and sustained improvement of 7%, over 9 months of follow-up. 2 participants with normal or mild impairment based on baseline ppFEV1 were maintained with stable disease over a 9- to 12-month follow-up. Critically, all 3 patients showed meaningful and sustained improvement in quality of life as measured by the respiratory domain of the validated CFQ-R instrument. Quality of life increased by 6 to 22 points, which was well above the minimal clinically important difference for this instrument. Cystic Fibrosis is caused by mutations that result in dysfunctional Cystic Fibrosis Transmembrane-conductance Regulator, or CFTR protein. Without properly functioning CFTR, cells are unable to effectively move chloride from inside the cell to the cell surface, this results in thick and mucus inflammation, frequent infections and ultimately progressive respiratory failure. CF affects over 100,000 individuals in the world and approximately 40,000 individuals in the U.S. Patients currently receive intensive and time-consuming daily airway clearance therapy: mucolytics, inhaled antibiotics and bronchodilators. Twice daily oral CFTR modulators can partially restore mutant CFTR function in people with CF who have eligible mutations. The modulator market generated approximately $9 billion of sales in 2022 in the market is growing. Our initial target population includes approximately 15% of all people with CF, including those who are not eligible for CFTR modulators or who are intolerant of modulators. Modulator side effects include neuropsychiatric and hypersensitivity disorders. Ultimately, with 4D-710, we believe we have the opportunity to potentially treat all people with CF regardless of CFTR mutation status, both as a single agent and in combination with modulators. The field typically describes reduced CFTR function at 2 levels, minimal function where little to no CFTR protein is at the cell surface and consequently, no CFTR function is present versus residual function where there is some function of CFTR protein in cell surface. Here, we show the impact of the CFTR mutation and modulator treatment status on percent predicted FEV1 -- and people with minimal function mutations, ppFEV1 declines approximately 75% more rapidly compared to those with residual function. Overall progression in ppFEV1 was assessed in a Phase 3 study of Orkambi modulator treatment in patients with eligible mutation, and untreated patients declined at an average of 2.3 points versus 1.3 points per year for treated patients. Together, these results suggest that the initial target patient population for 4D-710 as lung disease that progresses rapidly given the lack of disease-modifying therapies for them. Prior AAV gene therapy approaches in cystic fibrosis relied exclusively on a conventional AAV2 vector. In a 51 patient Phase 2 clinical trial of aerosolized AAV2 carrying a CFTR transgene, safety was demonstrated, but no transgene expression was observed within lung tissue samples. No benefit was demonstrated in terms of FEV1 or other lung-related endpoints. The investigators noted that effective aerosol-delivered AAV vectors were clearly needed. We took a very different approach. Rather than relying on a nonspecific naturally-occurring AAV vector, we invented a novel synthetic AAV vector that was customized for efficient aerosol delivery to the lung. We use our therapeutic vector evolution platform in nonhuman primates or NHP to invent our customized vector A101. Our target vector profile for lung diseases included routine aerosol delivery at safe dose levels, penetration through the mucus barrier, resistance to antibodies present in the human population and efficient transduction of multiple airway cell types. 4D-710 comprises our proprietary A101 vector during a transgene payload with ubiquitous strong promoter upstream of the CFTR delta R transgene. This slide illustrates the strong performance of A101 and 4D-710 in preclinical models. In the top left, we show A101's strong resistance to human antibodies compared to wild-type AAV serotypes. On the bottom left, we show 4D-710 as a high degree of specificity for NHP lungs after aerosol administration. On the right, we show a broad and widespread delivery in transduction with 4D-710 and NHP. Now for a brief summary of the payload in 4D-710. CFTR delta R is identical to the wild-type human CFTR gene, except for a targeted partial deletion in its regulatory domain. In various in vitro and in vivo models, the protein has shown comparable function and regulation to wild-type CFTR. CFTR delta R was highly effective in the pig model of CF lung disease, which mirrors the human disease. 4D-710 mediated CFTR delta R is able to generate dose-dependent CFTR functional activity that was equivalent to Trikafta. These data give us confidence that this protein has potential to restore CFTR function in patients. For delivery of 4D-710, we selected the commercially available AeroEclipse II breath-actuated jet nebulizer. This device generates stable and reproducible droplets that distribute evenly throughout the large and small airways plus alveoli. I'd like to now hand the presentation over to Dr. Jennifer Taylor-Cousar, primary investigator for the trial to present the trial and the data. Thanks for being with us today. Dr. Taylor-Cousar?

Thanks, David. The key objectives of the AEROW Phase 1/2 study are to assess the following: the safety, tolerability and immunogenicity of a single nebulized dose of 4D-710, CFTR transgene delivery and expression throughout multiple regions of both lungs in participants, clinical activity over 12 months as determined by changes in spirometry, including percent predicted FEV1 and quality of life assessments. Finally, to determine the recommended Phase 2 dose. Inclusion criteria included adults with CF variants not amenable to CFTR modulator therapy, or based on intolerance to CFTR modulator therapy. Overall, it is estimated that approximately 15% of people with CF fall into this subgroup. We, therefore, are treating participants with high unmet medical need on this trial. In its first-in-human trial, participants were required to have a baseline percent predicted FEV1 of 50% to 100% and the resting oxygen saturation of 92% or higher. Here is the design of the Phase 1/2 AEROW clinical trial. The Phase 1 dose exploration phase is designed to assess 2 dose level cohorts. 1 times 10 to the 15th, and 2 times 10 to the 15th (sic) [ 1E15 and 2E15 ] vector genomes per participant as a single dose. In the study diagram below, you can see 4D-710 aerosol administration on day 1. Pre-dose procedures include airway clearance technique, a nebulized bronchodilator called albuterol and pre- and post-bronchodilators spirometry. Bronchoscopy is performed at week 4 to 8 in order to select multiple lung samples for assessment of transgene delivery and expression. [ Transient immunosuppression ] is given as a prednisone taper over 4 weeks starting on day minus 1. Based on preclinical data, we believe the transgene expression can increase over 8 to 12 weeks before stabilizing. Today, we will share interim safety, lung tissue biomarker and clinical activity data from all 3 cohort 1 participants. As of the data cut-off, participants have been on study for approximately 9 to 12 months. This table shows key baseline characteristics of the 3 cohort 1 participants. Ages range from 20 to 36 years old, 1 participant with intolerant of modulators while 2 had CFTR variants that were ineligible for modulators. Of note, these participants had mild-to-moderate CF lung disease with percent predicted FEV1 of approximately 69% to 95%. In the future, as we enroll participants in dose expansion, we anticipate enrollment of participants with more advanced lung disease. Moving on to safety and tolerability results to-date. No DLTs or 4D-710 related adverse events were reported after completion of dosing administration. Dosing was well-tolerated. During aerosol administration, a single participant reported transient, mild dry throat and fatigue. This slide shows serial spirometry and adverse event during the nebulization procedure for 4D-710. As you can see, there were no significant declines in lung function or adverse events during the procedure. This slide illustrates the safety data that's demonstrated to-date post dosing of 4D-710 with no 4D-710 related AEs, SAEs or DLTs. Now let's consider the lung biomarker data. Here, we outlined the target expression profile we hope to achieve in this study. Historically, 10% or greater correction of overall CFTR function, corrected the mucus layer in CF derived monolayers. In people with CF, the presence of 15% or greater residual CFTR function correlates with less severe disease. Given the historical data, we also aim to transduce at least 15% of target cells. We aim to develop a product candidate that could achieve widespread, reproducible distribution throughout the airways, including all major epithelial cell types with resistance to preexisting antibodies. Finally, the cells that were transduced, we aim to achieve protein expression level that at least equivalent to normal observed levels. This slide shows the post-dosing bronchoscopy sampling plan scheduled for week 4 with flexibility to do it later depending on participants status at day 28. Bronchoscopy was performed to collect numerous widespread lung tissue samples for assessment of 4D-710-mediated transgene delivery and expression. The table on the left summarizes the number and location of lung samples collected by biopsies and brushings of both lungs and multiple regions. Biopsy samples were obtained for PCR, specifically for transgene DNA. In addition, both biopsy and brushing samples were obtained for in situ hybridization or ISH, specifically for transgene RNA expression and immunohistochemistry or IHC, for CFTR protein within biopsy samples. The diagram on the right shows locations of all 4 protocol-defined biopsies in green. These biopsies were taken at the entry to the upper and middle lobes on the right and at the entry to the upper lobe and lingula on the left. In orange, lung brushing locations are shown in the lower lobe bilaterally. As reported previously at the North American CF Conference in November 2022, this slide shows detailed biopsy data demonstrating widespread delivery and expression of the CFTR transgene product in all 3 participants' lungs. All 5 biopsies were positive. In the bar graph on the right, the Y-axis shows a percent of cells positive for expression by ISH in each biopsy determined by machine learning-assisted image analysis software. These data show reproducibility among the 3 participants and throughout the lungs bilaterally. The range of percent cell positivity was from 36% up to 47% in these participants with a mean of 40%. Here, we again showed clear biodistribution of CFTR protein in lung samples. All samples were positive for protein, including in all major cell types and notably in basal cells, which are long-lived stem cells of the lung. Importantly, protein was localized to the apical membrane, which is the key interface between lung epithelial cells and the lung airway lumen. Again, observed a CFTR levels were above those in normal controls. This slide describes our immunohistochemistry, or IHC methodology for analyzing protein expression and tissue samples. We use the Visiopharm machine to analyze samples based on the IHC intensity. The right images show samples from 4D-710 compared to representative controls from normal and CF lungs. You can see clear above normal CFTR expression in samples from 4D-710 treated lungs. Here, we show the quantified CFTR protein data from the scheduled biopsies. As you can see, based both on percent positive and intensity based on H score, CFTR levels were significantly above that observed in normal and CF controls with p-values all less than 0.01. Controls included commercially available CF and normal lung control samples. Here are additional images demonstrating the cell types producing and the apical localization of the protein in 1, basal cells; 2, goblet cells; 3, columnar ciliated cells. Here, we show our program objectives in terms of target expression profile. In summary, we're encouraged to see that we achieved all of our target expression profile objectives for 4D-710. We believe that reproducible, consistent distribution and transgene expression above normal levels in airway should ultimately translate into benefit for people with CF. We'll now discuss the observed in vitro expression translated to clinical activity endpoints. Before we summarize our clinical activity data, I first want to illustrate the typical course of these endpoints for people with CF. For spirometry, we focused on percent predicted forced expiratory volume in one second, or ppFEV1. Historically, the average annual rate of decline for people with CF was 2.3% per year, with intra-subject variability of approximately 4.5 percentage points. This data suggests that a change greater than 4.5 points in individual participant could be considered meaningful. Participants 1 and 3 have percent predicted FEV1 value that were in the mild-to-normal range at baseline. In such participants, marked improvements in percent predicted FEV1 may be less likely, the stability over this time frame would be clinically meaningful, particularly in a group of people without options for any currently approved disease-modifying therapies. As we demonstrate here for 9 to 12 months after a single aerosolized dose of 4D-710 both participants percent predicted FEV1 values remained stable. Now considering participant 2, what a minimal function mutation and started with moderate impairment at baseline FEV1 of 69%. We were encouraged to see a clinically meaningful improvement of 7 percentage points through 9 months. The participant had 2 viral infections, but no pulmonary exacerbations to-date. In approving new therapies, the FDA considers how a new therapy makes the patient feel, function and survive. Thus, the FDA considers improvements in quality of life but improving new therapies. In people with CF, we measure quality of life by the CF questionnaire-revised respiratory domain scale or CFQ-R. The validated minimally clinically important difference is 4 points, and historical data from the placebo arm of a modulator trial shows the untreated CF participants can experience an annual rate of decline of approximately 4 points. The CFQ-R instrument is validated for patient-reported outcomes and recognized by the FDA as a meaningful clinical efficacy endpoint, supportive of product approvals with strong reliability, validity and responsiveness to changes in disease. In the graph, you can see a pivotal study of approximately 150 participants taking Ivacaftor, the first approved modulator therapy for a small proportion of people with CF. The mean change from baseline at week 48 was plus 6 for treatment and minus 4 for placebo. Considering response in our participants, we plotted out CFQ-R scores over time. Respiratory-related adverse events such as exacerbation or viral infections, which can significantly affect measurements are indicated in gray. When considering the evaluable results, the maximum changes were all significantly above the minimally clinically important difference of 4 points. Maximal changes per participant range from plus 6 to plus 11 to plus 22. These highly encouraging data suggests that participants are experiencing benefits in their day-to-day quality of life. To summarize, in contrast to historical data showing deterioration over time in the natural course of CFD, 4D-710 participants experienced stable or improved percent predicted FEV1 measurements and all participants had clinically meaningful quality of life improvements. We believe this data is very encouraging, early evidence of clinical activity for a single-aerosolized dose of 4D-710. This slide summarizes all results for participant 2 who had moderate CF1 disease at baseline and most significant improvement on clinical activity measures. In this participant, we demonstrated widespread, high-level CFTR protein expression, improved percent predicted FEV1 and improved quality of life by 22 points. For a full review of this data, the presentation is available on the 4DMT website. This slide again summarizes all biomarker and clinical activity data we described previously. Now I'd like to hand the presentation back over to David.

Thank you, Dr. Taylor-Cousar to summarize the data presented today. We enrolled 3 CF participants who had no available disease-modifying therapies, and we treated them with a single-aerosolized dose of 4D-710 at 1E15 vector genomes. 4D-710 was well tolerated with no related AEs, DLTs or SAEs after dosing. All 11 lung samples collected were positive for CFTR protein expression by IHC. 92% to 99% of cells were positive. These values were highly statistically significant compared to controlled samples from people with or without CF. All major cell types, including ciliated, goblet and basal cells expressed CFTR protein and correct localization of the apical membrane was observed. In terms of clinical activity, we saw clinically meaningful improved percent predicted FEV1 in the participant with moderate impairment at baseline and stable percent-predicted FEV1 and the 2 participants with normal and mild impairment at baseline. Historical data suggests these participants would otherwise have seen a decline of over 2 percentage points annually. In terms of quality of life, all 3 patients had clinically meaningful improvements with increases of 6 to 22 points. Participants had quality of life improvements above the minimal clinically important difference at 6 of 7 evaluable time points. Historical data suggests these participants would have otherwise had a decline of around 4 points. So we're highly encouraged by these data, and we're excited to discuss our planned next steps to rapidly advance the 4D-710 program. Today, we shared Interim Cohort 1 data, and we're looking forward to present Cohort 2 data for the high-dose of 2E15 vg, which we expect will be at the North American CF Conference in November of 2023. We expect to select the optimal dose for expansion in the Phase 2 stage of the AEROW trial in the second half of this year. We expect to bring the totality of this data to the FDA in Q4 to discuss our pivotal trial design, including proposed approvable endpoints. Finally, we expect to provide a development plan update on studying 4D-710 in combination with modulators in Q4. Before we move into Q&A, I'd first like to acknowledge and thank our trial participants and their families. Our principal investigators and study staff and the Cystic Fibrosis Foundation Therapeutic Development Network. In addition, I'd like to thank the CFF for their unwavering support for this program and for 4DMT as a company. Operator?

[Operator Instructions]. Your first question comes from the line of Salveen Richter with Goldman Sachs.

2 questions for me. One is, could you provide more detail on Patient 3's respiratory-related AE? And then secondly, just given the differences in gene therapy and CFTR modulator mechanisms, how would you envision the design of a pivotal trial? Could you use these 2 end points? Are you exploring other measures? And if I could add to that, could you just speak to the validity and how you could reproduce the quality of life data given the single-arm design?

Well, thank you, Salveen. It's great to have you on the call today. Thanks for the question. In terms of the AEs, there were no 4D-710-related adverse events whatsoever. I think, you might be referring to the pulmonary exacerbations in Patient 3, which are very common in these patients, and Dr. Taylor-Cousar can speak to. And in terms of pivotal endpoints, we're very, very excited about the quality of life improvements as well as the potential to improve FEV1. So why don't I turn these questions over to Dr. Taylor-Cousar to expand?

Hey David, sorry, I was off the line for a second. Could you repeat the question?

Oh, no worries. No worries. So I think, Salveen, was asking about the pulmonary exacerbations in Patient 3. And are those typical -- and can we describe those? And then pivotal trial endpoints for the patients with this high unmet medical need who are not amenable to modulators?

Yes, sure. So particularly over the last year, it has been an incredibly hard viral season for people with CF because, of course, everybody was masking and then all of a sudden, everybody was not masking. So we saw a huge increase in exacerbations over this last year because about 1/3 of exacerbations in people with CF, both adults and kids are triggered by viral infections. So I think that's very typical particularly given the last viral season. In terms of the endpoints, I'm personally ecstatic. I have a group of people who do not have access to modulators because of either intolerance or ineligibility. And I think a medicine like this that could stabilize or improve their lung function and improve their quality of life so much is really critical. They are suffering right now, not just because they don't have a modulator because they know their colleagues and their friends and other people have it, and it's very hard on them emotionally. So the fact that there is some very positive data from this trial is incredibly encouraging.

Your next question comes from the line of Kostas Biliouris with BMO Capital Markets.

Congratulations on the data. A couple of questions from me. You mentioned that 40% plus of the epithelial cells were positive in the lung biopsies. And then your target product profile would be 15% of the cells being transduced. I know, this 15% probably refers to all cells, but is there any way for you to quantify what -- to what extent you meet this 15% of cells being transduced in this first dose? And what would you expect in the next dose? And then I have a follow-up.

Well, thanks, Kostas. And yes, I appreciate the congratulations. We're very excited as well. So going into this, the concept historically is if you look at lung function of about 15% or higher despite the mutation in CFTR, those patients have much less severe disease. So you're right that, that's 15% probably across all cells as opposed to 15% of cells. So -- but that is directionally gave us a target. Now we hit 40% on ISH, which is very specific for the transgene payload. But we know that that's not very sensitive because there's only a -- typically a few [ transcripts ] for cell. What's more important here is that we had 92% to 99% of cells staining positively by CFTR protein by IHC. And that's done by an objective Visiopharm machine learning-assisted analysis. And so, that's incredibly rigorous, and we saw a very high statistical significance, 0.001 or less on both the percent of cell staining and also the intensity of staining for the protein. So I'd say we kind of blew right through that 15% target, and we hit over 90%. And we're seeing well above normal levels per cell, so I think in terms of a biomarker, this is a home run. No one had shown expression in lung meaningfully ever before. And here at the very first dose level, we're seeing over 90% of cells expressing and expressing well statistically above normal samples and CF samples.

Great. And maybe…

And this is Jennifer, I would. Go ahead. I was just going to add that [ it wasn't just into ] -- across cell types as well, which I think is really important. I mean again, as David said, this is the first time we've ever shown this transduction in the lower airways. And we don't know exactly which cell types need to have it, but we saw it across cell types. So I think that's important to note.

And maybe one more question on Participant 3. They had neutralizing antibodies, moderate levels of neutralizing antibodies -- did you see anything that can help you understand whether you could potentially redose here with the gene therapy? First question. And the second question is this patient seems quite normal. And I'm wondering whether you could expect more patients like them to take the gene therapy in the commercial setting because it seems that their FEV1 function is normal and they're still opting for a gene therapy, which is somewhat risky. So I'm wondering what your thoughts are around that.

Thank you, Kostas. I'll answer the first one and then turn it over to Jen for the second one. So in terms of antibodies, we did have data from primates to say that despite cross-reacting antibodies from other AAVs that are very common in primates, actually, we did see some cross neutralization there in the assay in the blood, but we saw no impact on our ability to deliver by the airway. And I think a lot of that has to do with a very high concentration of vector in each droplet, and then these droplets are essentially a little protected droplets of fluid that then get distributed to the airway and they just need to go straight through the mucus to the target cells. So we have not preclinically seen any relationship between transduction and antibody titers, and we're thrilled to see here 2 of our 3 patients had some antibodies, low and moderate in the blood from cross-reacting from other AAVs out in the environment, and we saw no impact on transduction. So we're thrilled. And we do think that, that means that redosing likely is a possibility. We don't know if and when we're going to need to redose, but may be anywhere from 3 to 5 years out based on the turnover of the mouse lung. But we do think this is evidence that we almost certainly can redose if we need to. So we're thrilled. Thanks for the question. Jen, over to you about the question of how a participant comes on a study like this with 95% FEV1 and how you see that evolving over time?

Yes. No, it's a great question. And I think that the short answer is that to maintain that lung function of 83 or 95, those people are doing a lot of work every day. So they're taking aerosol therapy, albuterol, for example, inhaled antibiotics, mucolytics for hours a day, twice a day at least when they're well. And so even though their lung function looks relatively preserved, they are doing a lot of work to maintain it there, and they still are getting in the past admitted for IV antibiotics in the hospital. So even though it appears to be relatively good lung function, it's at a big cost to them on a daily basis. And they know that they are at risk at any time of having an exacerbation during which they don't recover to their baseline lung function. So about 25% of the time, people don't make it back to their baseline. So I would say that, yes, people who aren't eligible for modulators will both definitely even with mild lung dysfunction who wants this therapy as they felt that it was safe and then it worked. I also think that over time, as more data like this comes out, more people who have more moderate to severe disease are going to be willing to be in trial. I think, some of them may have been a little bit nervous about a new inhaled therapy -- in the fact that they had lower lung function. But I think both themselves and their doctors will be more confident in seeing this data in [ longer than ] both to participate in the trial and get the therapy down the line if it were ever approved.

Your next question comes from the line of Nalin Tejavibulya with Jefferies.

Congratulations on progress. I have 2, please. So with CFTR expression seen in multiple cell types, you note basal cells, goblet cells and ciliated columnar cells, could you please talk about the implied durability, what the implied durability would be for this therapy based on the lung cell turnover for cystic fibrosis patients before you observed loss of clinical meaningful efficacy?

Thank you, Nalin, for the question and for attending today. I'll sort of give my perspective and then turn it over to Jen. So as you correctly point out, we have multiple cell types, which we think is a great idea, great outcome because, again, no one knows really which cell types are preferred for expression or whether there's a benefit in expressing in all cell types. Certainly, we're thrilled to hit the basal cells, which Jen can speak to are the stem cells of the lung and should be relatively long-lived in lung compared to other cell types. In terms of the turnover lung, we the only data I'm aware of is in mouse and that looks like it's about 1.5 years, so maybe humans are 3 to 5 years, whether that's different in a CF patient, we don't know. But I'll turn it over to Jen to answer that question and also comment on the basal cells.

Yes, I think we are thrilled to see it in basal cells just for the reason that David had stated. We think that it means it's going to be longer lasting. But I will just reiterate that we don't know what the answer is. We don't know what the turnover rate of stem cells is in the lung in people with CF. So -- and obviously, the mouse doesn't develop CF1 disease spontaneously even when you induce CFTR mutations. So the mouse model may get us a little clue as David said, but I don't think that we know the answer again, because this is groundbreaking. It hasn't been seen before. And so part of it will be actually rebiopsying some of these patients later in time.

Got it. And as a follow-up -- sorry, second question. Regarding the use of 4D-710 in combination with CFTR modulators, what does the percent of predicted FEV1 shown here mean for those who are eligible for CFTR modulators? And what can we realistically expect from combination therapy in terms of FEV1 improvement?

Thanks, Nalin. I'll answer the biological question and Jen can answer in terms of the clinical outcomes. Biologically, we think there is a real chance for synergy here. And the reason we say that is with an effective modulator treatment, the mucus should be thinned, therefore, we should get even better transduction, potentially even at lower doses. So that could give us an advantage in those patients. And then, it's likely that many of these modulators will also bind our CFTR because with the exception of a small regulatory region, the ion channel is identical. And so, we may get a direct benefit from the modulators on our transgene as well. So we're excited about the combination there. And I'll let Jim speak to FEV1.

Yes. I think that there -- it's really important to realize that although Trikafta on average improve lung function by 10%, there's a wide range. So if you go back and look at the [ middles in paper ], you can see that there is a very wide range of how much lung function improvement people saw. So particularly those people who didn't see a lot of lung function improvement, I think there is a possibility of seeing a combination effect with 4D therapy.

Any conjecture on what kind of range we might potentially be able to expect realistically?

Honestly, it was only 3 people so far that were -- we got these long-term data on. It would be just a guess. I mean in vitro, the [ HPE ] model has been very predictive. So it's a possibility that we could study that in vitro and then make a better guess. But right now, with only 3 participants, it would be hard to say on average what that might be.

Your next question comes from the line of Tazeen Ahmad with Bank of America.

So maybe just a follow-up on CFTR modulators. Dr. Taylor-Cousar, a question for you. What would you think would be an ideal trial design here? Because it didn't include any patients that were on CFTR modulators. So do you think it would be wise to perhaps stratify by patients on and off modulators as part of that Phase 2? And then maybe a question for David. In terms of the November data update, approximately how many patients are in Cohort 2? And would we also be seeing follow-up data from the patients that you've already shown us today?

Thanks, Tazeen, and thanks for being here today. We appreciate the questions. I'll answer the first one and then turn it over to Dr. Taylor-Cousar. We're not disclosing the exact number of patients we have on Cohort 2, we'll definitely update the totality of the data for Cohort 1 and Cohort 2, including additional follow-up from these patients at the November meeting, and I'm sure Dr. Taylor-Cousar will be making that presentation. So we look forward to that. And I'll turn it over to Jen to answer the second question.

Yes, it's a great question. I mean, I think that we need to first figure out what our dose is going to be, obviously, between the 2 cohorts to make that decision once we have sufficient data to determine that both in the terms of safety and efficacy. But ultimately, I do think that we want to include people in the Phase 2 expanded Phase 2 with those who are on modulators. And yes, like stratifying them to those who are on and those are off modulators will be important in terms of looking at the outcomes. But again, we may be able to look at some preclinical data before that to help us make some of those decisions.

Okay. And maybe just one follow-up question. Just on FEV1, just clinical meaningfulness, how do you define that? So for the 2 patients so far that were stable, do you consider that clinically meaningful? I know that in general, patients will deteriorate that average of 2.3 percentage points per year. But would you want to see something better than stable ideally? Or is that good enough?

So I'd liken this back to the Orkambi data. So when Orkambi was approved, some people questioned about why it was approved. And it was really critical at that point because those patients had no therapy whatsoever that was disease modifying. So in people with CF, stability is a huge goal for a lot of people. Improvement is ultimately what we would like to see for every single person. But in some people, stability is a big change. And also, these improvements in quality of life, we are seeing are higher than what we saw with Orkambi, and that's also critical, because people are trying to go to school and go to work and have their lives. And so making them stable and have a much better quality of life is something that we consider important and the FDA has said that they consider are important. Again, with the [ field ] functions and survive. So I think it's clinically meaningful when someone doesn't have to go to the hospital or do less therapies and that they feel much better.

Thanks, Jen. And just I've learned this from talking to you is that I think some of those Orkambi patients who were sort of depending on the mutation might be even 2% to 4% improvement, and that was enough -- in FEV1, and that was enough to get it approved. So especially with the quality of life associated with it, it can be quite small differences or even stable disease. So thanks for the question.

Exactly.

Your next question comes from the line of Mani Foroohar with SVB Securities.

I'm trying to project how to think about this in future studies. Obviously, this is certainly impressive evidence on delivery, expression, et cetera. But the clinical endpoints in question are highly variable in the case of FEV1 and subject to placebo effects, another very -- sort of variability in quality of life. Would it be reasonable to acceptable -- to expect a placebo-controlled trial in the future [ to work for all ] these things? And practically speaking, how does one really control for some -- build a placebo-controlled trial on top of Trikafta presumably, given the sort of narrower gap in terms of what's available, in terms of FEV1 improvement. If you could help us just think about [ desirable ] potential pivotal study, [ desirable ] potential powering, [ I know you were ] talking about an effect size that starts to get narrowed as you get close to normal, et cetera?

Thanks, Mani, for the question, and thanks for being here. Maybe I'll answer this and also Dr. Taylor-Cousar can weigh in as well. I think what we're -- what's very heartening to us is that in other randomized studies look such as the Orkambi study where they looked at the quality of life outcome. It actually went down and stayed down, it was down by about 4 points, whereas Orkambi gave us a plus 6. Here, we have a plus 6, a plus 11, and plus 22. And 6 out of 7 data points actually showed that. And so to us, that's meaningful, given the lack of a placebo effect in other trials. So that's a great question. I think, Jen can comment on the possibility in these patients of doing a single-arm study for a pivotal trial approval, perhaps with accelerated approval and then what a combination randomized trial might look like?

Yes, I agree totally with you, David, about the placebo effect and quality of life, like we just don't see that in the CF trials and the CF trials that have been done to-date, the people who are in the placebo arm do go down with their quality of life. In terms of looking forward, I mean, I think it's going to certainly depend on what the regulators decide because we are, again, as I said before, breaking new territory. In terms of including people with Trikafta, I think that we probably would want to initially include those who didn't have a 30% lung function improvement, for example, and including those people who have had 0% to 5% improvement because in that end that you're talking about would need to be quite the same as if we're not looking for somebody who may only go up 1% or not at all, just stay stable versus somebody who didn't have a huge Trikafta response and has more room for improvement.

That's helpful. And given the relatively the high safety profile, how do you think about dose selection? Is the -- are you dosing to a target efficacy profile? And if you're dosing until you see a safety issue, that can take a very, very long time given how safe the contract looks at this level.

Yes. We're thrilled with the safety to date, and we need to follow the patients at the higher dose level, 2x higher, and see what that looks like. And I think Jen, and the rest of the experts will sit down and look at the totality of the data and ask the question, which of these 2 dose levels do we prefer to proceed. But I'll turn it over to Jen for a commentary on that.

Yes, I agree, especially given the expression label data that we're seeing now at the lower dose, I think it really is going to depend on what the safety looks like between the 2 doses to take a decision. I don't anticipate that there'll be multiple higher doses that we'll need to look at, given the expression that we're seeing even at the lowest dose.

Your next question comes from the line of Josh Schimmer with Evercore.

Congrats on the update. So for the patient who had moderate FEV1 decline at baseline, they seem to have a very robust and near normalization of their quality of life scores, the FEV1 improvement in that patient was good, but still not normalized. So how do we think about the ceiling effect of FEV1? And why that patient might not have, despite very robust uptake of the product, not had a stronger FEV1 signal perhaps commensurate with the quality of life benefit? And then second, would you consider evaluating a lower dose in addition to a higher dose?

Well, thanks, Josh, for the question and thanks for being here, and I'll turn that over to Jen.

Yes. In terms of quality of life and the cumulative effect of FEV1, it is so variable between people with CF. You can have a huge improvement in lung function and lower than what we saw in this trial, improvement in quality of life and vice versa. So I think that's very hard to say from participant to participant. And I don't know that we've seen a ceiling effect. I mean, certainly, with the modulator trials, we have seen people continue to slightly go up over time as probably the mucus [ plugging ] continues to clear and they have less exacerbations. So I don't know that we've seen where this lung function improvement can go. But certainly, we can see a disconnect between what happens to the quality of life and lung function. But they don't always exactly parallel each other. And in terms of going down to a lower dose, I don't know that we've seen at this point in these 3 people, we haven't seen these safety signals that suggest that we should be going down and we're pretty happy with where we are with the expression. And again, we're seeing some improvement in somebody with more moderate disease and stabilization, and in people who have more mild disease. So I don't think we've seen an indication that suggests that we need to go to a lower dose. I don't know, David, if you want to add to that?

No, I think that's spot on. I think, we're thrilled with the safety to-date and the transduction and the quality of life benefit. So yes, time will tell. But certainly, as you said, Jen, no indication we need to go up on doses higher than the 2x that will occur in Cohort 2. Sorry, Josh, go ahead.

Yes. No, I just want to probe a little bit further on a potential ceiling effect in an individual patient and why there may be FEV1 function that -- in this type of a patient that just cannot be recovered? And does it reflect scarring or other features of the disease that just may be irreversible? Or does it imply that there is an ongoing disease process that has not been fully corrected by the gene therapy?

Yes, great point. That's first one for you, Jen. Yes.

I feel like a question -- yes, yes. Yes, so even if you call it and look -- so of course, during the modulator trials, we excluded people with lung function that was less than 40% in those original trials. And then subsequently, we went and looked and people who had lung function that was less than 40%, certainly, we did not see 14%, 15% improvement in those folks. The improvements were much lower. So there is some degree of irreversibility for some of these people. And again, on an individual basis, we can't predict who those people are going to be. But certainly, when you have established disease, some degree of it will be irreversible. I mean that's part of the reason like all of us who are adults, [ yes doctors ] know that we're going to, unfortunately, or fortunately continue to have doubts, even though we have the modulators right now. And if we add some therapy like this, we still have doubts because there is going to be some degree of irreversible damage in people who have had long-standing infection in Bronchiectasis. And we see that now. So even if you're on Trikafta, you can still have pulmonary exacerbations, for example. So I think part of that is just irreversibility in some degree for each person, and we can't predict that per person at this point.

There are no further questions at this time. I'll turn the call back to Dr. David Kirn for closing remarks.

Well, thank you so much, everyone, for your time and attention today. And thank you again to Dr. Taylor-Cousar for being here with us today. We really appreciate your expertise and dedication to this trial. Thanks again to all the patients, to the families and the sites and once again to the Cystic Fibrosis Foundation, who've been just phenomenal partners, scientifically and clinically with us throughout this journey. So thanks, everyone. Have a great day.

This concludes today's conference call. Thank you for joining. You may now disconnect.