Avidity Biosciences, Inc. (RNAM) Earnings Call Transcript & Summary

Good morning, everyone. My name is Farhan Khan. I'm an associate with the healthcare investment banking group at JPMorgan. Very excited today to be continuing the conference with Avidity Bio. Joining me is Avidity's President and CEO, Sarah Boyce. Please note that we won't be doing a Q&A session following the presentation today, and appreciate you all being here. So with that, please join me in welcoming Sarah.

Thank you, and it is a pleasure to be here this morning. And it is awesome thank you so much to the JPMorgan team for inviting us to present at your conference. Before I start, I have to say what a pleasure it is to see so many of you in the audience wearing pink. And when we were walking down from our hotel this morning to see so many other people at JPMorgan wearing pink today. It's in recognition of the biotech sister herd and in recognition of our female leaders in biotech and in pharma, and their many contributions to our health care industry. During the course of this presentation, I will be making forward-looking statements, and I ask you to read the forward-looking statements that are available on our website. So 5 years ago, actually on a Tuesday, I presented at the JPMorgan meeting. And it was at that time that we laid out our vision for what we were going to try and do at Avidity. That vision 5 years later is unchanged, and it is to profoundly improve people's lives by revolutionizing the delivery of RNA therapeutics. Five years ago, Avidity was preclinical. We were sharing data from one program, that program is now Del-desiran, and it was data in nonhuman primates. And at that time, we were not even guiding to a timing around our first IND. Fast forward 5 years, we have 3 programs that are now all in the registrational phases of development. And we're incredibly excited to be filing our first BLA for Del-zota for boys and young men amenable to exon 44 skipping at the end of this year. It is simply incredible progress. Now what I'm going to do during this presentation is really dive deeper into our vision, splitting it up into 2 parts. I'll start looking at the profound improvement in people's lives, what that means and how that has translated through in data and how that's translating through to our goals for this year and going forward, and then the second half is around our work in revolutionizing the delivery of RNA therapeutics, and how we're continuing to expand on that. And I will close out looking at our map, our catalyst map for 2025 and what to expect from us from 2025 as we continue forward on that consistent reproducible execution that we delivered throughout the past 5 years and in particular, during 2024. Now let's move to the aspect of profoundly improving people's lives. We chose these words extremely carefully, and they are also our guide point to how we work as a company. So part of that profound improvement is targeting diseases where there is no approved therapies. Just for context, for myotonic dystrophy, at the time that we entered into the clinic with Del-desiran, there wasn't even a single other drug being studied in the clinic for this disease. That's the potential to make a profound improvement. And I'll talk about our data and our plans where you'll see how that expands. For Del-brax and FSHD, we were the first drug ever to enter the clinic targeting -- directly targeting the underlying cause of the disease, which is aberrant expression of DUX4. We are also in spaces where these diseases are genetic. What you see is a family, and this is around the choice of the word people. We don't actually say patients in our vision, we save people. When you are living with a genetic rare disease, when you meet Crystal and Lorraine, they don't describe themselves as a myotonic dystrophy patient, they describe themselves as someone living with myotonic dystrophy. But this also impacts the whole family. It also has significant impact on other caregivers, physical therapists, nurses and physicians. And we're also looking to make an impact on their lives by bringing therapeutics for these patients. Now looking at our 3 programs that are now in registrational phase. For Del-zota, there's about 900 boys and young men in the U.S. amenable to exon 44 skipping. And we were thrilled to announce last week that we have aligned on our regulatory path with the FDA for accelerated approval, I'll take you through the data that supports that and our plan to file our first BLA at the end of this year for Del-zota. Now for Del-desiran and Del-brax, these are actually 2 indications for a large, both Del-desiran, both FSHD and myotonic dystrophy, each of them on their own is about the same size as cystic fibrosis. It is our estimate for Del-desiran that there's about 80,000 people in the U.S. and Europe living with myotonic dystrophy. And we are bang on track to be the first drug approved ever for this disease, both in the U.S. and also around the world. FSHD, similar patient population size. I've talked about close to 90,000 people when you combine the U.S. and Europe are estimated to be living with FSHD today. Again, there are no approved therapies, and we are also bang on track to be the first drug ever to be approved for FSHD. Doing this is profound impact. Now looking at the progress that we have made over the course of the past 5 years and where we are today. 2024 was a big year for us at Avidity. It was a big year for the patient communities that we're looking to serve, because what you saw from each of our programs as we read data out was a reproducibility and a consistency. We now for Del-desiran and Del-brax have shown functional changes. For Del-desiran, we've actually shown reverse sort of disease progression. For Del-zota, the EXPLORER study is 6 months -- so functional improvements. We're in the process of planning our study around 4 full approval that will be focused on that. But I'll share with you data where you can see why we are so excited about the potential for dose from a functional perspective for boys and young men living with exon 44 skipping. We have aligned our regulatory path for Del-zota in the U.S. and the registrational programs is -- are now ongoing. We are adding some additional participants into the open-label extension study for Del-zota to round out our safety database. Now looking at Del-desiran. I will show with you our data that shows reversal of disease progression. For Del-desiran, we have agreed our regulatory pathway around the world with the FDA, with EMA, with Japan and with other regulatory authorities. The HARBOR study, which is our Phase III study is recruiting beautifully and is on track to complete enrollment in the middle of this year. For Del-brax, for the first time ever, we also saw functional changes and signs of functional improvement in people living with FSHD. We actually have leaned in and we already have a study that is recruiting today for potential accelerated approval. And we're also guiding to start a study designed for full and global approval in Q2 of this year. The regulatory pathway right now is in flight. And we are looking to share that and share more details around that in Q2 of this year. And that includes both the accelerated pathway as well as the design of our study targeting full approval. Now we're going to focus in on each drug in turn. I'm going to start with Del-zota. So September of last year, we shared data that was truly remarkable, seeing 25 increases in near full-length dystrophin production. That has never been seen before. That was also coupled with profound reductions in creatine kinase. Again, this has never been seen before in DMD, either with an exon skipper or with gene therapy. So how do you -- how does this all piece together? And this is where you start to see some of the consistency and reproducibility in our data readouts. First off, we can deliver to muscle period. Unsurpassed delivery of a PMO to muscle cells. There is no delivery technology that delivers more PMO to muscle cells than our technology. When you do that, you get skipping. And then in turn, that leads to your increases in dystrophin production. And when you take near 4 length dystrophin with a 25% increase, the other remarkable thing happens, where you see serum creatine kinase, which is extremely elevated in boys with DMD, it's in the like 8,000 levels and what you see is that same creatine kinase comes down, stays down. And it's literally sort of flatlining around close to the upper limit of normal. -- going to show with you a new piece of data. Were we looked at -- so this is just focusing in on serum creatine kinase in the blue, what you see is these other participants who are receiving 5 milligrams who rolled into the open-label extension study. And what you see again is the consistency where the serum creatine kinase continues to stay down. The top line where you see the gray, these are the participants who received placebo. Then when they transfer on to Del-zota, the same thing happens. You see those consistent reductions in serum creatine kinase, they go down and they stay down. It is this data that has allowed us to align our regulatory pathway with the FDA. The data I have shared with you from a dystrophin production is sufficient from a regulatory approval perspective. And we are anticipating to file our first BLA, our first BLA as a company at the end of this year. We are also deep into our launch preparations for Del-zota in the U.S. And one of the aspects with Del-zota that really brings a unique aspect around our skeletal muscle franchise, is this is the same physicians. For FSHD and myotonic dystrophy, it is exactly the same prescribing physicians and there is some overlap with DMD. So preparing for the Del-zota launch allows us to build all of our infrastructure within the U.S., run that through with an ultra-orphan launch and then now when it comes to Del-desiran and Del-brax, we're effectively just layering on. It gives us enormous efficiency from an organizational build perspective. Now moving to Del-desiran. Last year, we met Jeannine. Sometimes you meet people who just radiate warmth. Jeannine is one of those people. And she participated in a panel. One of the things we do as a company is a couple of times a year, we bring the whole team together because we have people all over the U.S. The core collaboration weeks. And when we do that, there's a big emphasis from a patient perspective. Jeannine sat on one of those panels. At the end of the panel, she was asked a question. And she was asked a question around what does she have to say to the team? What are asked of us? Now one of the other things you'll notice if you ever meet people from the Avidity team or visit our company is we're into stickers, I don't know why. But there are stickers on laptops, there are stickers on water bottles, there are stickers on people's phones. And one of the things you'll see is a sticker that has 2 words, Hurry up. That's what Jeannine asked us to do. There are sometimes moment as a company that knit into your fabric as a team. Jeannine's 2 words hurry up is deeply with us. I'll talk about why. As I've shared, Del-desiran, it's the first drug to show reversal of the first and only drug to show reversal of disease progression in people living with myotonic dystrophy. What I'll focus you on in the beginning is the chart. This is the natural history data from the NDM-1 study. This gives you a perspective around how the disease progresses symptomatically in a 1-year period. This is in participants who were matched to our enrollment criteria for the MARINA study. So we're essentially looking at mapping that on a year basis. What you also see is 4 measures on this slide. That quantitative muscle testing, hand grip and DM1 Activ. vHOT is the primary for our clinical trial, and you see the 3 key secondaries. Why are these 4 important? These 4 measures give you a total perspective of the impact of this disease. vHOT is a systematic way in a clinical trial, it's video and opening time. If you have not seen the videos, I advise you to go on our website -- it's in our corporate deck and run that video that shows where someone is a participant has asked to squeeze, squeeze, squeeze and release. The hallmark of myotonic dystrophy is myotonia. Myotonia is the inability to normally release a contracted muscle. We measure myotonia using the video and opening time. But myotonia takes place throughout the body. When you meet people living with myotonic dystrophy, and one gentleman wants described it to me of -- he's like Sarah, think of anything you do in your day. And I was like going shopping, go in to the grocery store. He said, for your one trip to the grocery store, for me to do one trip to a grocery store is effectively like doing it 3x. That's how exhausting this is Think about it. You're living with contracted muscles, that is exhausting. One of the other things that, that leads to is deteriorations in muscle strength. We look at a range of different muscles in QMT and then individually, we look at hand grip that actually gives you the perspective of hand function. You lose the function of your hands, you lose independence. One of the other aspects of this disease as you'll hear around fatigue as a core sign. Fatigue is driven by that myotonia and muscle weakness. You also hear about day time sleepathy, day time sleepiness, about apathy. One of the other elements as we have spent an enormous amount of time with the patient community, sleep apnea is actually really common. If you are not sleeping well, what happens to you during the day? We all know what it feels like to have a bad night sleep. Think about if that is your life. And one of the things with sleep apnea, when you get people's diaphram stronger, you get them breathing better. The tongue is very heavily impacted by myotonia and you are able to release that, you improve sleep apnea. And part of this, some of these measures, this is where DM1 Activ comes in. DM1 Activ is the preferred tool by the FDA to measure from a quality of life, implicate quality of life impacts for this disease, and we get that perspective from DM1 Activ. So that gives you the perspective of living with myotonic dystrophy. So the data that we've shared. Again, reproducibility, consistency. We delivered to muscle, we engage our target, we're able to see functional changes and all of this underpinned by a favorable safety and tolerability profile. This is the data that we shared. This is a 12 month, the circles, the diamonds, about to say circles, the diamonds that you see are participants who have received Del-desiran. You can see the separations. You can see the separations from the error bars. And you see from that midpoint in the middle of the slide where people are improving from myotonia to muscle strength regardless of how you look at it, and from DM1 Activ. So what are we looking to do next? As I have said, we have aligned our regulatory pathway. The HARBOR study is enrolling beautifully, and we're on track to complete enrollment by the middle of the year. And we're on track and so excited to be the first time for the myotonic dystrophy community where we can bring a drug and doing that around the world. And as you would expect, as we're building for Del-zota, we're also focusing on Del-desiran and preparing for our launch there. We're tracking to file our BLA for Del-desiran, our second BLA as a company next year. Now moving to Del-brax to FSHD. We were the fast drugs are once again leading the field to directly target the underlying cause of the disease, the aberrant expression of DUX4. The data that we showed in June, exactly the same pattern. We deliver to muscle, we can engage our target. We can look at the downstream genes involved in implicating of hitting that target and then we also saw trends of functional improvement and patient reported outcomes. All of that underpinned by a favorable safety and tolerability profile. Now what you see here its data from a DUX4 circulating biomarker that was discovered by Avidity, by our team of scientists led by Mike Flanigan, our CSO, at Avidity. This is game-changing for FSHD. This is the result of 2 years of work of huge effort to look at. Is there a way that we can find a circulating biomarker versus letting at the muscle biopsies? The advantage of the circulating biomarkers is that allows us to track that over time and actually see the whole body perspective. The other aspect of when we look at the circulating biomarker and then we take a look at serum creatine same thing, litte circulating biomarker and serum creatine run together. So where are we now with Del-brax? We actually have 2 strategies in place and 2 studies, one that is right now enrolling and one that we're looking to initiate enrollment in Q2. The first is designed for potential accelerated approval in the U.S. At the time of seeing the data that we shared in June, we led in and have initiated this study. We were very clear as well. At the time of that initiation, we had not discussed it with the FDA. Recruitment for that study is going extremely well and we are on track to also complete enrollment of the accelerated -- the potential accelerated approval cohort in Q2 of this year. We're also very much in flight in our negotiations, and we're looking forward in Q2 to sharing an update as a result of our discussions with the FDA around the accelerated approval path. The other thing that we're also doing and also planning to initiate in Q2 is our global Phase III trial designed for full approval in the U.S. and approval around the world, just like we did with Del-desiran. We are now in the process of working with regulatory authorities around the world to get alignment on the design of that clinical -- of the clinical trial -- when we have aligned on that design, we'll then also provide an update, and that's tracking for Q2. So now moving to the second pillar of our vision, which is around revolutionizing the delivery of RNA therapeutics. Five years ago, it was kind of like a -- we laid out that we could deliver RNA to muscle cells. No one had ever been able to do that in our industry. And we shared our nonhuman primate data, you can see now 5 years later what that has translated to from an aspect of that work and really revolutionizing the space. This is our pipeline today, where we have 3 programs in pivotal phase of development in the registrational phases of development, first BLA this year, second BLA for myotonic dystrophy in 2026, and we'll provide an update with regards to FSHD in Q2 of this year. The other aspect from a revolutionizing the delivery of RNA therapeutics, is also going to our second therapeutic area, which is in targeting the heart. Directly targeting the underlying cause -- the underlying genetic mutations of cardiomyopathy in the heart. We can deliver beautifully to the heart with our technology, and in November, we shared the first of our precision cardiology programs, both PLN, targeting PLN and PR KG2 syndrome. So let's talk a little bit around precision cardiology. This is precisely targeting underlying genetic causes of cardiomyopathy single gain of function mutations. It's what siRNAs do really, really well. The data we showed, showed our robust consistent delivery to heart muscles, our target knockdown, engagement of our target and then also an overall well-tolerated profile in nonhuman primates. And also, we were very pleased to see no effects on ECG parameters. This has us incredibly excited as to what we can do. Think about what we did in skeletal muscle, what we're doing in skeletal muscle. And we're now taking that and expanding that revolution of RNA delivery into the heart. The other aspect is our technology. Our technology today, our AOCs today, deliver siRNAs beautifully, and we've all seen that. We could have stopped there. One of our aspects, though, is around -- we're running on a 10-year game plan and around continuing to innovate on that technology. In November of last year, we shared some of the advancements we have made -- both our proprietary advancements we have made both in the siRNA which will be -- you'll see that in our precision cardiology programs coming forward. And then in the future, where we both enhance the engineering of the antibody and additional modifications in engineering on the siRNA that increase our potency 30-fold. So what you get in that? You get life cycle management. you also enable less frequent dosing, potential lower dosing and you enable things like subcutaneous delivery. So that expansion and innovation around delivery expands and is taking us to even more potent drugs going forward. Now looking at delivering on our vision -- further delivering on our vision and what that looks like from an execution perspective in 2025. We're preparing to launch 3 drugs and 3 drugs in pretty short order. Three drugs for the -- with the same prescribing physicians. It gives us incredible efficiency as we look to build our organization globally, because we can build a global organization when you're essentially layering on drug on top of the other because you can launch those drugs with exactly the same team. One of the things that you see from our science and how we operate as a company, is when we go into a disease area, we go deep. We look to understand that disease better than any one period. You've seen us do that with myotonic dystrophy with our work on bulk [RNA-Seq]. We've looked at thousands of genes. You see how we do that in FSHD where we took on the challenge of finding a circulating biomarker. It's exactly the same depth of approach that comes into how we prepare for commercialization. The other aspect, people build companies, not drugs, not technologies, it's people. We have assembled an incredible team that I am so proud of who have deep, deep rare disease experience. We are in a position, and this is no exaggeration. Well, for example, when we were hiring ahead of patient services. We said, who do we think the best Head of Patient Services is in the U.S. It's that person, and we're going to go out and hire them, and we did, and that just has been repeating through as we have built our organization. You also saw us expand our leadership team at the beginning of this year. Thrilled to have Pat join us as our Chief Business Officer and Chuck joined us as our Chief Technical Officer. What you see with this leadership team is actually really now, this is where we come into our own because this team is a team that has deep experience in launching drugs in rare diseases. Now looking to our 2025 and our map for 2025. It's going to be a full year. I'm going to take each program in turn. As I shared for Del-zota, we're looking forward to showing the top line data from the EXPLORER study in Q1 of this year. In Q4 of this year, and sharing data from the EXPLORE open label extension study as well as filing our first BLA submission. For Del-desiran, in Q1, we're going to be sharing additional data analysis from the MARINA study. In Q3, what, middle of the year. We are on track to complete our enrollment in the HARBOR study. And Q4, we're looking to share data from the Marina open-label extension study that gives a long-term perspective of people who've been on drug, who have been on Del-desiran. And just to add, 37 of the 37 participants remain in the open-label extension study. This is now we've had people receiving Del-desiran for years. Now looking at Del-brax. It's also pretty obvious when you look at this. The Q2 is a big quarter for Del-brax. It's a huge quarter for the FSHD community. So there's a couple of things that we're looking to line up here. Firstly, is sharing top line data from the FORTITUDE study, completing enrollment in the Fortitude biomarker cohort, which was designed for potential accelerated approval, and then showing the regulatory alignment work, both around accelerated as well as the full approval strategy. In closing, our vision as a company is to profoundly improve people's lives by revolutionizing the delivery of RNA therapeutics. We are 3 for 3 on the data readouts of our programs, and think of where we'll be 5 years from now, where our goal is to have been able to make a profound impact on hundreds of thousands of people's lives. Thank you.